MILWAUKEE - ManpowerGroup (NYSE: NYSE:MAN) reported a modest beat on adjusted earnings per share (EPS) for the second quarter, despite a decline in revenue compared to both analyst expectations and the previous year's results.
The global workforce solutions company announced an adjusted EPS of $1.30, surpassing the analyst estimate of $1.27. However, revenue for the quarter fell short at $4.52 billion, just below the consensus estimate of $4.53 billion and marking a 7% decrease from the same period last year.
The company's performance reflects a continued challenging environment in North America and Europe, with employers remaining cautious in their hiring. This has led to a slight softening in permanent recruitment activity compared to the previous quarter. Despite these headwinds, ManpowerGroup managed to maintain solid staffing margins and reduced selling and administrative expenses by 9% as reported, or 7% in constant currency terms.
CEO Jonas Prising commented on the results, "Employers in North America and Europe continue to remain cautious. Permanent recruitment activity softened slightly further from the previous quarter, while staffing and solutions activity remained relatively stable across most of our large markets. We continue to prioritize the execution of our strategic initiatives and driving sales activities while balancing costs to align with the current operating environment."
Looking ahead, ManpowerGroup anticipates adjusted diluted EPS for the third quarter to be between $1.25 and $1.35, which includes an estimated unfavorable currency impact of 5 cents. The guidance excludes any restructuring costs and any Argentina-related impact of non-cash currency translation losses. The midpoint of the guidance range, $1.30, is above the current analyst consensus estimate, which was not provided in the press release.
ManpowerGroup also highlighted its strategic initiatives, including the repurchase of $27 million of common stock during the quarter, as part of its commitment to delivering shareholder value. The company's gross profit margin stood at 17.4% for the quarter, and net earnings were $60.1 million, down from $65.2 million in the prior year period.
The financial results included final run-off losses related to the Proservia Germany business, which reduced EPS by $0.06 in the second quarter. Excluding these losses, the adjusted EPS represented a decrease of 12% in constant currency. The company's six-month results also reflected the impact of these charges, with adjusted EPS for the period at $2.25 per diluted share, a decrease of 26% in constant currency.
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