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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

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FORM 8-K

 

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CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 20, 2007

 

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MANPOWER INC.

(Exact name of registrant as specified in its charter)

 

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Wisconsin		1-10686		39-1672779
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

5301 North Ironwood Road Milwaukee, Wisconsin		53217
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (414) 961-1000

 

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Securities Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

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Item 2.02 Results of Operations and Financial Condition

On April 20, 2007, we issued a press release announcing our results of operations for the quarter ended March 31, 2007. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Reflected in our earnings for the quarter ended March 31, 2007 is one item that requires us to revise previously reported financial results. Italy and Other EMEA are now identified as separate reportable segments, which were previously combined and reported as the EMEA segment. Attached hereto as Exhibit 99.3 is our Operating Unit Results since January 1, 2005, restated to conform to the current year presentation.

Item 9.01. Exhibits.

 

Exhibit No.		Description
99.1		Press Release dated April 20, 2007
99.2		Presentation materials for April 20, 2007 conference call
99.3		Operating Unit Results reflecting the restatement of segment results

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

		MANPOWER INC.
Dated: April 20, 2007		By:		/s/ Michael J. Van Handel
				Michael J. Van Handel Executive Vice President, Chief Financial Officer and Secretary

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EXHIBIT INDEX

 

Exhibit No.		Description
99.1		Press Release dated April 20, 2007
99.2		Presentation materials for April 20, 2007 conference call
99.3		Operating Unit Results reflecting the restatement of segment results

Exhibit 99.1

[MANPOWER logo]

 

FOR IMMEDIATE RELEASE		Contact:
		Mike Van Handel
		Manpower Inc.
		+1.414.906.6305
		michael.vanhandel@manpower.com

Manpower Reports 1^st Quarter 2007 Results

MILWAUKEE, WI, USA, April 20, 2007 – Manpower Inc. (NYSE: MAN) today reported that net earnings from continuing operations for the three months ended March 31, 2007 more than doubled to $59.5 million, or 69 cents per diluted share, compared to $29.5 million, or 33 cents per diluted share, a year earlier. Revenues for the first quarter were $4.5 billion, an increase of 17 percent from the year earlier period.

Results for the first quarter were favorably impacted by 5 cents per diluted share as foreign currencies were relatively stronger compared to the first quarter of 2006. On a constant currency basis, revenues increased 10 percent over the prior year period. Included in prior year net earnings of 59 cents per diluted share is 26 cents per diluted share of earnings related to discontinued operations. Also included in prior year net earnings is a 16 cents per diluted share charge related to reorganization costs and a global cost reduction initiative.

Jeffrey A. Joerres, Manpower Chairman and Chief Executive Officer, said, “The strength of our European geography combined with company-wide operational excellence resulted in a very strong first quarter for Manpower.

“The Manpower team is executing extremely well, our Other EMEA segment (Europe excluding France and Italy) increased profitability by 144 percent, while Manpower France, our single largest operation, increased profitability by 33 percent on a constant currency basis. The U.S. operation, expectedly, experienced softness in revenue, but realized an increase in profitability of 22 percent.

“Our ability to deliver such strong earnings, given the softness in the U.S. market, demonstrates the strength of our geographic and business mix as well as the underlying quality, talent and dedication of our people throughout the world.

“Given the current trends, we anticipate our second quarter diluted earnings per share to be in the range of $1.12 to $1.16, which includes an estimated favorable currency impact of 6 cents.”

In conjunction with its first quarter earnings release, Manpower will broadcast its conference call live over the Internet on April 20, 2007 at 7:30 a.m. CDT (8:30 a.m. EDT). Interested parties are invited to listen to the webcast and view the presentation by logging on to http://investor.manpower.com.

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Supplemental financial information referenced in the conference call can be found at http://investor.manpower.com.

About Manpower Inc.

Manpower Inc. (NYSE: MAN) is a world leader in the employment services industry; creating and delivering services that enable its clients to win in the changing world of work. The $18 billion company offers employers a range of services for the entire employment and business cycle including permanent, temporary and contract recruitment; employee assessment and selection; training; outplacement; outsourcing and consulting. Manpower's worldwide network of 4,400 offices in 73 countries and territories enables the company to meet the needs of its 400,000 clients per year, including small and medium size enterprises in all industry sectors, as well as the world's largest multinational corporations. The focus of Manpower's work is on raising productivity through improved quality, efficiency and cost-reduction across their total workforce, enabling clients to concentrate on their core business activities. Manpower Inc. operates under five brands: Manpower, Manpower Professional, Elan, Jefferson Wells and Right Management. More information on Manpower Inc. is available at www.manpower.com.

Forward-Looking Statements

This news release contains statements, including earning projections, that are forward-looking in nature and, accordingly, are subject to risks and uncertainties regarding the Company’s expected future results. The Company’s actual results may differ materially from those described or contemplated in the forward-looking statements. Factors that may cause the Company’s actual results to differ materially from those contained in the forward-looking statements can be found in the Company’s reports filed with the SEC, including the information under the heading ‘Risk Factors’ in its Annual Report on Form 10-K for the year ended December 31, 2006, which information is incorporated herein by reference.

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Manpower Inc.

Results of Operations

(In millions, except per share data)

 

		Three Months Ended March 31
		2007			2006			% Variance
								Amount Reported			Constant Currency
		(Unaudited)
Revenues from services (a)		$	4,535.6		$	3,877.2		17.0	%		9.6	%
Cost of services			3,735.6			3,184.0		17.3	%
Gross profit			800.0			693.2		15.4	%		8.5	%
Selling and administrative expenses			696.7			632.9		10.1	%		3.9	%
Operating profit			103.3			60.3		71.2	%		57.1	%
Interest and other expenses			9.6			13.0		-26.2	%
Earnings before income taxes and discontinued operations			93.7			47.3		97.9	%		84.5	%
Provision for income taxes			34.2			17.8		91.5	%
Net earnings from continuing operations			59.5			29.5		101.8	%		88.1	%
Income from discontinued operations, net of income taxes			—			23.1		N/A
Net earnings		$	59.5		$	52.6		13.1	%		5.4	%
Net earnings per share - basic:
Continuing operations		$	0.70		$	0.34		105.9	%
Discontinued operations			—			0.26		N/A
Total		$	0.70		$	0.60		16.7	%
Net earnings per share - diluted:
Continuing operations		$	0.69		$	0.33		109.1	%		93.9	%
Discontinued operations			—			0.26		N/A
Total		$	0.69		$	0.59		16.9	%		8.5	%
Weighted average shares - basic			84.9			87.4		-2.9	%
Weighted average shares - diluted			86.5			88.7		-2.4	%

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(a)

Revenues from services include fees received from our franchise offices of $8.4 million and $8.0 million for the three months ended March 31, 2007 and 2006, respectively. These fees are primarily based on revenues generated by the franchise offices, which were $362.4 million and $362.8 million for the three months ended March 31, 2007 and 2006, respectively.

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Manpower Inc.

Operating Unit Results

(In millions)

 

		Three Months Ended March 31
		2007			2006			% Variance
								Amount Reported			Constant Currency
		(Unaudited)
Revenues from Services:
United States (a)		$	483.6		$	510.3		-5.2	%		-5.2	%
France			1,493.0			1,240.5		20.4	%		10.4	%
Other EMEA (b)			1,476.4			1,149.8		28.4	%		17.0	%
Italy (b)			304.8			242.4		25.7	%		15.3	%
Jefferson Wells			81.3			95.5		-14.9	%		-14.9	%
Right Management			93.9			95.3		-1.5	%		-5.5	%
Other Operations			602.6			543.4		10.9	%		10.6	%
		$	4,535.6		$	3,877.2		17.0	%		9.6	%
Operating Unit Profit:
United States		$	11.5		$	9.5		21.6	%		21.6	%
France			43.9			30.4		44.4	%		32.6	%
Other EMEA (b)			36.7			13.6		168.6	%		144.5	%
Italy (b)			16.4			9.4		75.2	%		60.4	%
Jefferson Wells			1.0			5.7		-82.4	%		-82.4	%
Right Management			6.1			4.6		31.8	%		28.7	%
Other Operations			12.8			17.6		-27.7	%		-28.1	%
			128.4			90.8
Corporate expenses			21.9			27.3
Amortization of intangible assets			3.2			3.2
Operating profit			103.3			60.3		71.2	%		57.1	%
Interest and other expenses (c)			9.6			13.0
Earnings before income taxes and discontinued operations		$	93.7		$	47.3

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(a)

In the United States, revenues from services include fees received from the related franchise offices of $5.3 million for the three months ended March 31, 2007 and 2006. These fees are primarily based on revenues generated by the franchise offices, which were $269.1 million and $282.3 million for the three months ended March 31, 2007 and 2006, respectively.

(b)	Italy and Other EMEA were previously combined as the EMEA segment. All previously reported results have been revised to conform to the current year presentation.

(c)	The components of interest and other expenses were:

 

		2007				2006
Interest expense		$	14.2			$	11.6
Interest income			(7.2	)			(3.3	)
Foreign exchange losses			0.1				0.9
Miscellaneous expenses			2.5				3.8
		$	9.6			$	13.0

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Manpower Inc.

Consolidated Balance Sheets

(In millions)

 

		Mar. 31 2007				Dec. 31 2006
		(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	727.3			$	687.9
Accounts receivable, net			3,775.2				3,837.2
Prepaid expenses and other assets			142.4				90.5
Future income tax benefits			87.0				66.4
Total current assets			4,731.9				4,682.0
Other assets:
Goodwill and other intangible assets, net			1,305.7				1,293.6
Other assets			320.7				336.4
Total other assets			1,626.4				1,630.0
Property and equipment:
Land, buildings, leasehold improvements and equipment			712.5				693.2
Less: accumulated depreciation and amortization			511.1				491.1
Net property and equipment			201.4				202.1
Total assets		$	6,559.7			$	6,514.1
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	939.2			$	889.9
Employee compensation payable			150.2				180.7
Accrued liabilities			554.4				562.1
Accrued payroll taxes and insurance			652.2				699.9
Value added taxes payable			510.7				517.0
Short-term borrowings and current maturities of long-term debt			36.1				32.0
Total current liabilities			2,842.8				2,881.6
Other liabilities:
Long-term debt			800.5				791.2
Other long-term liabilities			416.1				367.1
Total other liabilities			1,216.6				1,158.3
Shareholders’ equity:
Common stock			1.0				1.0
Capital in excess of par value			2,446.7				2,420.7
Retained earnings			672.2				617.0
Accumulated other comprehensive income			136.2				120.6
Treasury stock, at cost			(755.8	)			(685.1	)
Total shareholders’ equity			2,500.3				2,474.2
Total liabilities and shareholders’ equity		$	6,559.7			$	6,514.1

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Manpower Inc.

Consolidated Statements of Cash Flows

(In millions)

 

		Three Months Ended Mar. 31
		2007				2006
		(Unaudited)
Cash Flows from Operating Activities:
Net earnings		$	59.5			$	52.6
Adjustments to reconcile net earnings to net cash provided by operating activities:
Gain on sale of business			—				(29.3	)
Depreciation and amortization			21.5				21.8
Deferred income taxes			15.7				(10.0	)
Provision for doubtful accounts			5.1				6.1
Stock based compensation			5.7				4.6
Excess tax benefit on exercise of stock options			(2.3	)			(2.7	)
Changes in operating assets and liabilities excluding the impact of acquisitions:
Accounts receivable			88.2				76.9
Other assets			(57.4	)			(19.5	)
Other liabilities			(33.2	)			(26.0	)
Cash provided by operating activities			102.8				74.5
Cash Flows from Investing Activities:
Capital expenditures			(16.8	)			(15.2	)
Acquisitions of businesses, net of cash acquired			(5.0	)			(7.2	)
Proceeds from sale of business			—				29.6
Proceeds from sale of an equity interest			—				8.8
Proceeds from the sale of property and equipment			1.6				2.2
Cash (used) provided by investing activities			(20.2	)			18.2
Cash Flows from Financing Activities:
Net borrowings of short-term facilities and long-term debt			3.8				3.2
Proceeds from stock option and purchase plans			20.0				26.5
Excess tax benefit on exercise of stock options			2.3				2.7
Repurchases of common stock			(72.7	)			(33.0	)
Cash used by financing activities			(46.6	)			(0.6	)
Effect of exchange rate changes on cash			3.4				7.5
Change in cash and cash equivalents			39.4				99.6
Cash and cash equivalents, beginning of period			687.9				454.9
Cash and cash equivalents, end of period		$	727.3			$	554.5

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Exhibit 99.3

Manpower Inc.

Restated Operating Unit Results

(In millions)

The following identifies Italy and Other EMEA as separate reportable segments, which were previously combined and reported as the EMEA segment. Historical amounts have been restated to conform to the current year presentation.

 

		Three Months Ended March 31												Three Months Ended June 30
								% Variance												% Variance
		2006			2005			Amount Reported			Constant Currency			2006			2005			Amount Reported			Constant Currency
		(Unaudited)												(Unaudited)
Revenue from Services:
United States		$	510.3		$	475.9		7.2	%		7.2	%		$	534.6		$	506.7		5.5	%		5.5	%
France			1,240.5			1,238.0		0.2	%		9.2	%			1,535.6			1,397.0		9.9	%		9.8	%
Other EMEA			1,149.8			1,074.2		7.0	%		16.1	%			1,257.5			1,148.0		9.5	%		10.0	%
Italy			242.4			215.3		12.6	%		22.7	%			291.7			233.1		25.1	%		25.0	%
Jefferson Wells			95.5			92.7		3.0	%		3.0	%			98.8			93.5		5.7	%		5.7	%
Right Management			95.3			103.3		-7.7	%		-4.4	%			102.6			107.1		-4.2	%		-4.2	%
Other Operations			543.4			496.7		9.4	%		13.8	%			563.8			508.0		11.0	%		13.7	%
		$	3,877.2		$	3,696.1		4.9	%		11.8	%		$	4,384.6		$	3,993.4		9.8	%		10.2	%
Operating Unit Profit:
United States		$	9.5		$	4.9		93.3	%		93.3	%		$	22.5		$	18.0		25.2	%		25.2	%
France			30.4			28.4		7.1	%		16.7	%			49.7			42.0		18.3	%		17.7	%
Other EMEA			13.6			4.7		194.6	%		224.9	%			29.5			23.3		26.2	%		25.3	%
Italy			9.4			7.4		26.0	%		37.7	%			21.2			12.6		68.1	%		67.0	%
Jefferson Wells			5.7			8.1		-29.4	%		-29.4	%			10.0			9.3		7.7	%		7.7	%
Right Management			4.6			10.3		-54.8	%		-55.5	%			11.1			9.5		15.8	%		14.3	%
Other Operations			17.6			12.1		44.7	%		53.8	%			14.8			12.8		16.5	%		21.2	%
		$	90.8		$	75.9								$	158.8		$	127.5
														Six Months Ended June 30
																				% Variance
														2006			2005			Amount Reported			Constant Currency
														(Unaudited)
Revenue from Services:
United States														$	1,044.9		$	982.6		6.3	%		6.3	%
France															2,776.1			2,635.0		5.4	%		9.5	%
Other EMEA															2,407.3			2,222.2		8.3	%		13.0	%
Italy															534.1			448.4		19.1	%		23.9	%
Jefferson Wells															194.3			186.2		4.3	%		4.3	%
Right Management															197.9			210.4		-6.0	%		-4.3	%
Other Operations															1,107.2			1,004.7		10.2	%		13.8	%
														$	8,261.8		$	7,689.5		7.4	%		11.0	%
Operating Unit Profit:
United States														$	32.0		$	22.9		39.8	%		39.8	%
France															80.1			70.4		13.8	%		17.3	%
Other EMEA															43.1			28.0		54.1	%		58.4	%
Italy															30.6			20.0		52.5	%		56.1	%
Jefferson Wells															15.7			17.4		-9.6	%		-9.6	%
Right Management															15.7			19.8		-20.9	%		-21.9	%
Other Operations															32.4			24.9		30.3	%		37.2	%
														$	249.6		$	203.4

 

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Manpower Inc.

Restated Operating Unit Results

(In millions)

 

		Three Months Ended September 30												Three Months Ended December 31
								% Variance												% Variance
		2006			2005			Amount Reported			Constant Currency			2006			2005			Amount Reported			Constant Currency
		(Unaudited)												(Unaudited)
Revenue from Services:
United States		$	542.1		$	531.5		2.0	%		2.0	%		$	527.9		$	534.2		-1.2	%		-1.2	%
France			1,654.0			1,479.3		11.8	%		7.0	%			1,589.0			1,361.5		16.7	%		7.7	%
Other EMEA			1,353.4			1,145.2		18.2	%		13.2	%			1,470.0			1,204.0		22.1	%		12.4	%
Italy			276.3			210.7		31.1	%		25.5	%			322.2			240.7		33.9	%		23.5	%
Jefferson Wells			93.9			103.9		-9.6	%		-9.6	%			84.8			96.1		-11.9	%		-11.9	%
Right Management			90.5			94.8		-4.6	%		-6.7	%			98.9			96.6		2.4	%		-1.8	%
Other Operations			579.8			522.2		11.0	%		12.8	%			617.9			535.2		15.5	%		14.7	%
		$	4,590.0		$	4,087.6		12.3	%		9.0	%		$	4,710.7		$	4,068.3		15.8	%		9.1	%
Operating Unit Profit:
United States		$	28.6		$	22.6		26.7	%		26.7	%		$	26.8		$	23.2		15.2	%		15.2	%
France			62.0			50.6		22.4	%		17.1	%			61.2			47.7		28.3	%		18.4	%
Other EMEA			49.2			34.8		41.2	%		35.5	%			64.4			37.7		70.8	%		57.9	%
Italy			16.7			9.4		79.0	%		70.9	%			16.2			14.2		14.4	%		6.2	%
Jefferson Wells			10.0			11.5		-13.7	%		-13.7	%			6.2			4.4		41.4	%		41.4	%
Right Management			2.2			2.3		-5.2	%		-10.3	%			0.4			3.6		-87.5	%		-74.1	%
Other Operations			16.4			16.3		1.3	%		3.8	%			21.1			19.2		9.9	%		10.3	%
		$	185.1		$	147.5								$	196.3		$	150.0
		Nine Months Ended September 30												Year Ended December 31
								% Variance												% Variance
		2006			2005			Amount Reported			Constant Currency			2006			2005			Amount Reported			Constant Currency
		(Unaudited)												(Unaudited)
Revenue from Services:
United States		$	1,587.0		$	1,514.1		4.8	%		4.8	%		$	2,114.9		$	2,048.3		3.2	%		3.2	%
France			4,430.1			4,114.3		7.7	%		8.6	%			6,019.1			5,475.8		9.9	%		8.4	%
Other EMEA			3,760.7			3,367.4		11.7	%		13.0	%			5,230.7			4,571.4		14.4	%		12.9	%
Italy			810.4			659.1		23.0	%		24.4	%			1,132.6			899.8		25.9	%		24.2	%
Jefferson Wells			288.2			290.1		-0.6	%		-0.6	%			373.0			386.2		-3.4	%		-3.4	%
Right Management			288.4			305.2		-5.5	%		-5.0	%			387.3			401.8		-3.6	%		-4.2	%
Other Operations			1,687.0			1,526.9		10.5	%		13.4	%			2,304.9			2,062.1		11.8	%		13.8	%
		$	12,851.8		$	11,777.1		9.1	%		10.3	%		$	17,562.5		$	15,845.4		10.8	%		10.0	%
Operating Unit Profit:
United States		$	60.6		$	45.5		33.3	%		33.3	%		$	87.4		$	68.7		27.2	%		27.2	%
France			142.1			121.0		17.4	%		17.2	%			203.3			168.7		20.5	%		17.6	%
Other EMEA			92.3			62.8		47.0	%		45.7	%			156.7			100.5		55.9	%		50.3	%
Italy			47.3			29.4		60.9	%		60.8	%			63.5			43.6		45.8	%		43.1	%
Jefferson Wells			25.7			28.9		-11.2	%		-11.2	%			31.9			33.3		-4.2	%		-4.2	%
Right Management			17.9			22.1		-19.2	%		-20.7	%			18.3			25.7		-28.8	%		-28.2	%
Other Operations			48.8			41.2		18.8	%		23.9	%			69.9			60.4		16.0	%		19.6	%
		$	434.7		$	350.9								$	631.0		$	500.9

 

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