Staffing company ManpowerGroup (NYSE: MAN ) reported first quarter earnings that fell 38% year over year on a GAAP basis; but, after adjusting for restructuring charges, earnings rose from 2012. Revenues fell 6% year over year, but met Capital IQ consensus estimates.
Manpower recorded revenues of $4.8 million in the quarter that ended March 31, falling below last year's $5.1 million effort, but right in line Wall Street's estimates. On the bottom line, the temporary employee specialist generated $23.9 million, or $0.31 per share, down sharply from the year ago figure of $42.0 million, or $0.50 per share. Analysts had expected $0.45 per share in earnings. Manpower, though, said that $25.3 million in after-tax restructuring charges, primarily comprised of office consolidation and severance costs, were responsible for a reduction of $0.32 in earnings per share as its European business remains challenging.
Revenues from France fell 11%, while Italy was down almost 4%, but operating profits in northern Europe tumbled 75%, and the Asia-Pacific and Middle East regions caused another 25% decline in operating profits. An 8% increase in the U.S. sector also couldn't offset the 43% drop elsewhere in the Americas.
ManpowerGroup Chairman and CEO Jeffrey A. Joerres said:
The first quarter performance was largely attributed to slightly stronger than anticipated revenues and tax credits. Additionally, our recalibration of our cost base is advancing ahead of schedule. Those efforts, which are focused on simplifying our business, were initially rolled out in the fourth quarter of 2012 and continued into the first quarter, resulting in the restructuring charge in the quarter. Our team has done an outstanding job dealing with the high levels of uncertainty in Europe and has continued to address client and prospect needs with our unique suite of solutions.
Manpower, however, forecast second quarter earnings of $0.84 to $0.92 per share before restructuring charges, above the average Capital IQ consensus estimate of $0.76 per share.