ManpowerGroup Earnings: Profit Drops in This Mixed Bag

ManpowerGroup (NYSE:MAN) reported its results for the third quarter. Manpower is in the employment services industry whose five brands are Manpower, Manpower Professional, Elan, Jefferson Wells, and Right Management. The company provides a range of services for the entire employment and business cycle.

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ManpowerGroup Earnings Cheat Sheet

Results: Net income for ManpowerGroup fell to $63.1 million (79 cents per share) vs. $79.6 million (97 cents per share) a year earlier. This is a decline of 20.7% from the year-earlier quarter.

Revenue: Fell 10.1% to $5.2 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: ManpowerGroup fell short of the mean analyst estimate of 81 cents per share. Analysts were expecting revenue of $5.21 billion.

Quoting Management: Jeffrey A. Joerres, ManpowerGroup Chairman and CEO, said, “Clearly, the economic environment continues to be challenging as we experienced a revenue decline of four percent in constant currency. However, the ManpowerGroup team did an extraordinary job of aggressively selling our value to our clients which resulted in stabilizing our gross margin. Additionally, we were extremely vigilant regarding cost and efficiency. Both contributed nicely to the third quarter performance. We will continue to pursue efficient models to deliver our service while creating more agility throughout the entire organization.

Key Stats:

After beating analyst estimates for the two previous quarters, the company fell short of forecasts. In the second quarter, it topped the mark by 4 cents, and in the first quarter, it was ahead by 15 cents.

Margins were up in the second quarter, following a drop in the previous quarter. Gross margins grew to 17%, up 0.5 percentage point from the year-earlier quarter. In the first quarter, the figure rose 0.4 percentage point to 16.5% from the year earlier quarter.

Revenue has declined for two quarters in a row. In the second quarter, revenue declined 8.1% to $5.21 billion from the year-earlier quarter.

Looking Forward: Over the past ninety days, the average estimate for the fourth quarter has fallen from 93 cents per share to 84 cents, indicating that analysts are growing pessisimistic about the company’s performance next quarter. Over the past sixty days, the average estimate for the fiscal year has reached $2.84 per share, a decline from $3.01.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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