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ManpowerGroup (MAN) Tops Q3 Earnings, Misses Revenues

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ManpowerGroup Inc.MAN posted third-quarter 2015 earnings of $1.61 per share that remained flat compared with the year-ago quarter, but were hurt by foreign currency headwinds that alone reduced the earnings by 25 cents.

However, excluding the impact of foreign currencies fluctuation, quarterly earnings came in at $1.86 per share. Nevertheless, we observe that the company's bottom-line handily surpassed the Zacks Consensus Estimate of $1.55.

ManpowerGroup Inc. - Earnings Surprise | FindTheBest

Revenues fell 8.2% year over year to $4,972.5 million due to negative Forex impact and missed the Zacks Consensus Estimate of $5,044 million. On a constant currency basis, revenues increased 5.8%, while earrings grew 15.5%.

Moving on, gross profit decreased 5.9% (up 7% in constant currency) to $852.1 million, while gross margin came in at 17.1% as against 16.7% a year ago. Also, operating profit of $206.3 million fell 2.8% (up 12.7% in constant currency).

Operating Groups

By geographic segments, revenues from the United States fell 3.9% year over year to $769.6 million. However, the segment's operating profit increased 8.7% from the prior-year figure to $45.5 million supported by higher gross profit margin.

In Other Americas, revenues declined 5.6% (up 16.4% in constant currency) to $367 million, while operating profit declined 9.7% (up 10.2% in constant currency) to $13.2 million.

In France, revenues fell 14.6% year over year (up 1.9% in constant currency) to $1,242.5 million, while operating profit decreased 11% (up 6.4% in constant currency) to $74.9 million.

In Italy, revenues grew 10.3% year over year (up 31.4% in constant currency) to $324.4 million. The segment's operating profit rose 19.1% (up 42.1% in constant currency) to $17.5 million.

In Other Southern Europe, revenues fell 0.6% (up 16% in constant currency) to $258.5 million from the year-ago quarter. Operating profit climbed 18.5% (up 38.3% in constant currency) to $7.3 million.

In Northern Europe, revenues fell 11.7% (up 3.1% in constant currency) to $1,373.4 million, while operating profit decreased 15.4% (down 3% in constant currency) to $50.3 million, both on a year-over-year basis.

In APME (Asia Pacific Middle East), revenues came in at $570.2 million, down 3.7% (up 11.9% in constant currency) year over year. The segment's operating profit was $23.9 million, up 9.9% (increase 27% in constant currency) year over year.

Also, revenues from Right Management decreased 6.6% (up 1.3% in constant currency) year over year to $66.9 million. The company posted operating income of $10.7 million, up a significant 72% (up 75.4% in constant currency) from the year-ago period.

Other Financial Details

ManpowerGroup ended the quarter with cash and cash equivalents of 652.5 million, long-term debt of $840.8 million and shareholders' equity of $2,685.2 million.

The company incurred capital expenditure of $33.3 million during the first nine months of 2015.

Guidance

Including a negative impact of 15 cents from foreign exchange, ManpowerGroup expects fourth-quarter 2015 earnings per share in the range of $1.47 to $1.55. The Zacks Consensus Estimate for stands at $1.52.

Revenues are expected to fall 1% to 3%, reflecting a negative impact of about 13% from currency fluctuations.

On a constant currency basis, revenues are expected to grow in the range of 6% to 8%. Revenues in the Americas are expected to grow in the 3% to 5% range. In Northern Europe, revenue growth is expected to be 5% to 7%, while that in Southern Europe will be in the range of 8% to 10%. Revenues in Asia Pacific Middle East are expected within 11% to 13%. The company expects revenues from Right Management to grow in the range of flat to 2%.

Zacks Rank

ManpowerGroup which competes with the likes of Korn/Ferry International KFY , Kforce Inc. KFRC and Resources Connection Inc. RECN sports a Zacks Rank #1 (Strong Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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