Kelly Services (KELYA) 8-K And Announces Quarterly Dividend

Exhibit 99.1

KELLY SERVICES^® REPORTS

SECOND QUARTER 2016 EARNINGS

AND ANNOUNCES QUARTERLY DIVIDEND

Second Quarter Highlights

• Total Revenue declines 0.7% (up 0.6% in constant currency)

• Gross Profit up 3.7% (up 4.8% in constant currency); Gross Profit Rate up 70 basis points

• Earnings per share of $0.23 (Adjusted EPS of $0.29) versus $0.18, a 28% increase

• TS Kelly Asia Pacific Joint Venture completed, forming one of the region’s largest workforce solutions providers

TROY, MI (August 10, 2016) -- Kelly Services (Nasdaq: KELYA) (Nasdaq: KELYB), a global leader in providing workforce solutions, today announced results for the second quarter of 2016.

Carl T. Camden, President and Chief Executive Officer, announced revenue for the second quarter of 2016 totaled $1.4 billion, a 0.7% decrease (a 0.6% increase on a constant currency basis) compared to the corresponding quarter of 2015.

Earnings from operations for the second quarter of 2016 totaled $9.9 million, compared to $11.5 million reported for the second quarter of 2015. Included in the results of operations in the second quarter of 2016 are restructuring charges of $3.4 million. Excluding the restructuring charges, earnings from operations were $13.3 million in the second quarter of 2016.

Diluted earnings per share in the second quarter of 2016 were $0.23 compared to $0.18 per share in the second quarter of 2015. Excluding restructuring charges, earnings per share were $0.29 in the second quarter of 2016.

Commenting on the second quarter, Camden stated, “We are pleased with Kelly’s ability to deliver strategic growth, improve Gross Profit, and increase shareholder value in the second quarter. The finalization of our Joint Venture in APAC positions us for growth in staffing-related services while enabling us to accelerate investments in OCG, which remains a Kelly-owned entity.” Referring to the apparent slow-down in U.S. staffing demand facing the workforce solutions industry in the second quarter, Camden commented, “Kelly responded quickly to flat top-line growth in the Americas by managing Gross Profit, adjusting our operating costs, and delivering solid leverage. We remain committed to increasing shareholder value by efficiently delivering the best workforce solutions for our customers around the world.”

Kelly also reported that on August 9, its board of directors declared a dividend of $0.075 per share. The dividend is payable September 2, 2016 to shareholders of record as of the close of business on August 23, 2016.

In conjunction with its second quarter earnings release, Kelly Services has published a financial presentation on the Investor Relations page of our public website and will host a conference call at 9:00 a.m. (ET) on August 10 to review the results and answer questions. The call may be accessed in one of the following ways:

1

Via the Telephone:

U.S. 1 800 288-9626

International 1 651 291-5254

The pass code is Kelly Services

Via the Internet:

The call is also available via the internet through the Kelly Services website:

www.kellyservices.com

This release contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties.  These factors include, but are not limited to, competitive market pressures including pricing and technology introductions, changing market and economic conditions, our ability to achieve our business strategy, the risk of damage to our brand, the risk our intellectual assets could be infringed upon or compromised, our ability to successfully develop new service offerings, our exposure to risks associated with services outside traditional staffing, including business process outsourcing, our increasing dependency on third parties for the execution of critical functions, the risks associated with past and future acquisitions, exposure to risks associated with investments in equity affiliates, material changes in demand from or loss of large corporate customers, risks associated with conducting business in foreign countries, including foreign currency fluctuations, availability of full-time employees to lead complex talent supply chain sales and operations, availability of temporary workers with appropriate skills required by customers, liabilities for employment-related claims and losses, including class action lawsuits and collective actions, the risk of cyber attacks or other breaches of network or information technology security as well as risks associated with compliance on data privacy, our ability to sustain critical business applications through our key data centers, our ability to effectively implement and manage our information technology programs, our ability to maintain adequate financial and management processes and controls, impairment charges triggered by adverse industry developments or operational circumstances, unexpected changes in claim trends on workers’ compensation, disability and medical benefit plans, the impact of the Patient Protection and Affordable Care Act on our business, the impact of changes in laws and regulations (including federal, state and international tax laws), the risk of additional tax or unclaimed property liabilities in excess of our estimates, our ability to maintain specified financial covenants in our bank facilities to continue to access credit markets, and other risks, uncertainties and factors discussed in this release and in the Company’s filings with the Securities and Exchange Commission.  Actual results may differ materially from any forward looking statements contained herein, and we have no intention to update these statements.

About Kelly Services^® 

As a global leader in providing workforce solutions, Kelly Services, Inc. (Nasdaq: KELYA, KELYB) and its subsidiaries, offer a comprehensive array of outsourcing and consulting services as well as world-class staffing on a temporary, temporary-to-hire, and direct-hire basis. In 2016, the Company is commemorating 70 years of industry leadership. Kelly® has a role in managing employment opportunities for more than one million workers around the globe by employing 550,000 of these individuals directly with the remaining workers engaged through its talent supply chain network of supplier partners.  Revenue in 2015 was $5.5 billion.  Visit kellyservices.com and connect with us on Facebook, LinkedIn, & Twitter.  

KLYA-FIN

# # #

ANALYST CONTACT: MEDIA CONTACT:

James Polehna Jane Stehney    

(248) 244-4586 (248) 244-5630

james_polehna@kellyservices.com jane_stehney@kellyservices.com

2

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE 13 WEEKS ENDED JULY 3, 2016 AND JUNE 28, 2015
(UNAUDITED)
(In millions of dollars except per share data)
									%			CC %
		2016		2015		Change			Change			Change
Revenue from services	$	1,375.5	$	1,385.0	$	(9.5	)		(0.7	)	%	0.6	%
Cost of services		1,145.0		1,162.7		(17.7	)		(1.5	)
Gross profit		230.5		222.3		8.2			3.7			4.8
Selling, general and administrative expenses		220.6		210.8		9.8			4.6			5.7
Earnings from operations		9.9		11.5		(1.6	)		(13.9	)
Other expense, net		0.2		1.0		(0.8	)		(74.8	)
Earnings before taxes		9.7		10.5		(0.8	)		(8.2	)
Income tax expense		0.8		3.7		(2.9	)		(78.5	)
Net earnings	$	8.9	$	6.8	$	2.1			30.2		%
Basic earnings per share	$	0.23	$	0.18	$	0.05			27.8		%
Diluted earnings per share	$	0.23	$	0.18	$	0.05			27.8		%
STATISTICS:
Gross profit rate		16.8	%	16.1	%	0.7		pts.
Selling, general and administrative expenses:
% of revenue		16.0		15.2		0.8
% of gross profit		95.7		94.8		0.9
% Return:
Earnings from operations		0.7		0.8		(0.1	)
Earnings before taxes		0.7		0.8		(0.1	)
Net earnings		0.6		0.5		0.1
Effective income tax rate		8.3	%	35.3	%	(27.0	)	pts.
Average number of shares outstanding (millions):
Basic		38.0		37.7
Diluted		38.3		37.8
Shares adjusted for nonvested restricted awards (millions):
Basic		39.0		38.8
Diluted		39.2		38.8

3

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE 26 WEEKS ENDED JULY 3, 2016 AND JUNE 28, 2015
(UNAUDITED)
(In millions of dollars except per share data)
									%			CC %
		2016		2015		Change			Change			Change
Revenue from services	$	2,724.6	$	2,705.6	$	19.0			0.7		%	2.5	%
Cost of services		2,261.4		2,263.0		(1.6	)		(0.1	)
Gross profit		463.2		442.6		20.6			4.6			6.2
Selling, general and administrative expenses		438.6		419.0		19.6			4.7			6.2
Earnings from operations		24.6		23.6		1.0			4.2
Other expense, net		1.0		3.5		(2.5	)		(70.9	)
Earnings before taxes		23.6		20.1		3.5			17.2
Income tax expense		3.5		9.6		(6.1	)		(63.4	)
Net earnings	$	20.1	$	10.5	$	9.6			90.5		%
Basic earnings per share	$	0.52	$	0.27	$	0.25			92.6		%
Diluted earnings per share	$	0.51	$	0.27	$	0.24			88.9		%
STATISTICS:
Gross profit rate		17.0	%	16.4	%	0.6		pts.
Selling, general and administrative expenses:
% of revenue		16.1		15.5		0.6
% of gross profit		94.7		94.7		—
% Return:
Earnings from operations		0.9		0.9		—
Earnings before taxes		0.9		0.7		0.2
Net earnings		0.7		0.4		0.3
Effective income tax rate		14.9	%	47.6	%	(32.7	)	pts.
Average number of shares outstanding (millions):
Basic		38.0		37.7
Diluted		38.2		37.8
Shares adjusted for nonvested restricted awards (millions):
Basic		39.0		38.8
Diluted		39.2		38.8

4

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)
		Second Quarter
							%			CC %
		2016			2015		Change			Change
AMERICAS
Commercial
Revenue from services	$	635.3		$	651.3		(2.5	)	%	(1.3	)	%
Staffing fee-based income included in revenue from services		3.6			3.5		2.9			3.7
Gross profit		98.9			95.9		3.2			4.2
Gross profit rate		15.6	%		14.7	%	0.9		pts.
PT
Revenue from services	$	241.6		$	246.2		(1.9	)	%	(1.7	)	%
Staffing fee-based income included in revenue from services		4.3			4.9		(11.1	)		(10.8	)
Gross profit		41.3			42.1		(2.0	)		(1.9	)
Gross profit rate		17.1	%		17.1	%	—		pts.
Total Americas
Revenue from services	$	876.9		$	897.5		(2.3	)	%	(1.4	)	%
Staffing fee-based income included in revenue from services		7.9			8.4		(5.2	)		(4.7	)
Gross profit		140.2			138.0		1.6			2.3
SG&A expenses excluding restructuring charges		111.7			112.6		(0.8	)		(0.2	)
Restructuring charges		2.2			—		NM
Total SG&A expenses		113.9			112.6		1.2			1.8
Earnings from operations		26.3			25.4		3.6
Earnings from operations excluding restructuring charges		28.5			25.4		12.2
Gross profit rate		16.0	%		15.4	%	0.6		pts.
Expense rates (excluding restructuring charges):
% of revenue		12.7			12.5		0.2
% of gross profit		79.6			81.6		(2.0	)
Return on sales (excluding restructuring charges)		3.3			2.8		0.5
EMEA
Commercial
Revenue from services	$	197.1		$	195.7		0.8		%	3.0		%
Staffing fee-based income included in revenue from services		3.7			3.2		16.6			21.4
Gross profit		27.1			26.8		1.5			3.4
Gross profit rate		13.8	%		13.7	%	0.1		pts.
PT
Revenue from services	$	43.1		$	42.9		0.5		%	2.2		%
Staffing fee-based income included in revenue from services		2.5			2.5		(4.4	)		(1.0	)
Gross profit		8.7			9.1		(5.5	)		(3.6	)
Gross profit rate		20.0	%		21.2	%	(1.2	)	pts.
Total EMEA
Revenue from services	$	240.2		$	238.6		0.7		%	2.8		%
Staffing fee-based income included in revenue from services		6.2			5.7		7.4			11.6
Gross profit		35.8			35.9		(0.3	)		1.6
SG&A expenses excluding restructuring charges		32.0			34.2		(6.3	)		(3.9	)
Restructuring charges		1.2			—		NM
Total SG&A expenses		33.2			34.2		(3.0	)		(0.6	)
Earnings from operations		2.6			1.7		54.4
Earnings from operations excluding restructuring charges		3.8			1.7		121.7
Gross profit rate		14.9	%		15.0	%	(0.1	)	pts.
Expense rates (excluding restructuring charges):
% of revenue		13.3			14.3		(1.0	)
% of gross profit		89.6			95.3		(5.7	)
Return on sales (excluding restructuring charges)		1.5			0.7		0.8

5

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)
		Second Quarter
							%			CC %
		2016			2015		Change			Change
APAC
Commercial
Revenue from services	$	87.9		$	90.3		(2.6	)	%	1.6		%
Staffing fee-based income included in revenue from services		1.7			1.8		(7.1	)		(3.5	)
Gross profit		10.3			11.2		(8.6	)		(4.7	)
Gross profit rate		11.7	%		12.4	%	(0.7	)	pts.
PT
Revenue from services	$	9.2		$	10.3		(11.4	)	%	(7.8	)	%
Staffing fee-based income included in revenue from services		1.4			1.5		(6.1	)		(1.1	)
Gross profit		2.5			2.7		(7.8	)		(3.6	)
Gross profit rate		27.4	%		26.4	%	1.0		pts.
Total APAC
Revenue from services	$	97.1		$	100.6		(3.5	)	%	0.6		%
Staffing fee-based income included in revenue from services		3.1			3.3		(6.6	)		(2.4	)
Gross profit		12.8			13.9		(8.4	)		(4.5	)
Total SG&A expenses		11.6			12.3		(5.4	)		(1.5	)
Earnings from operations		1.2			1.6		(31.4	)
Gross profit rate		13.2	%		13.9	%	(0.7	)	pts.
Expense rates:
% of revenue		12.0			12.2		(0.2	)
% of gross profit		91.2			88.3		2.9
Return on sales		1.2			1.6		(0.4	)
OCG
Revenue from services	$	173.9		$	165.0		5.4		%	5.9		%
Gross profit		42.8			35.7		20.1			20.9
Total SG&A expenses		38.0			32.2		18.1			19.0
Earnings from operations		4.8			3.5		38.2
Gross profit rate		24.6	%		21.6	%	3.0		pts.
Expense rates:
% of revenue		21.8			19.5		2.3
% of gross profit		88.7			90.2		(1.5	)
Return on sales		2.8			2.1		0.7
Corporate
Total SG&A expenses	$	25.0		$	20.7		20.5		%

6

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)
		June Year to Date
							%			CC %
		2016			2015		Change			Change
AMERICAS
Commercial
Revenue from services	$	1,283.9		$	1,292.7		(0.7	)	%	0.9		%
Staffing fee-based income included in revenue from services		7.2			7.0		3.0			4.0
Gross profit		201.0			193.7		3.8			5.1
Gross profit rate		15.7	%		15.0	%	0.7		pts.
PT
Revenue from services	$	478.7		$	479.0		(0.1	)	%	0.1		%
Staffing fee-based income included in revenue from services		9.3			8.4		10.9			12.1
Gross profit		82.9			81.0		2.3			2.5
Gross profit rate		17.3	%		16.9	%	0.4		pts.
Total Americas
Revenue from services	$	1,762.6		$	1,771.7		(0.5	)	%	0.7		%
Staffing fee-based income included in revenue from services		16.5			15.4		7.3			8.4
Gross profit		283.9			274.7		3.3			4.3
SG&A expenses excluding restructuring charges		228.3			226.1		1.0			1.9
Restructuring charges		2.2			—		NM
Total SG&A expenses		230.5			226.1		1.9			2.9
Earnings from operations		53.4			48.6		9.9
Earnings from operations excluding restructuring charges		55.6			48.6		14.4
Gross profit rate		16.1	%		15.5	%	0.6		pts.
Expense rates (excluding restructuring charges):
% of revenue		13.0			12.8		0.2
% of gross profit		80.4			82.3		(1.9	)
Return on sales (excluding restructuring charges)		3.2			2.7		0.5
EMEA
Commercial
Revenue from services	$	372.6		$	374.0		(0.4	)	%	2.9		%
Staffing fee-based income included in revenue from services		7.1			6.7		6.5			11.5
Gross profit		50.7			51.4		(1.3	)		1.7
Gross profit rate		13.6	%		13.7	%	(0.1	)	pts.
PT
Revenue from services	$	84.7		$	83.2		1.8		%	4.7		%
Staffing fee-based income included in revenue from services		5.1			5.1		(0.5	)		4.3
Gross profit		17.4			17.8		(2.4	)		0.8
Gross profit rate		20.5	%		21.4	%	(0.9	)	pts.
Total EMEA
Revenue from services	$	457.3		$	457.2		—		%	3.3		%
Staffing fee-based income included in revenue from services		12.2			11.8		3.5			8.4
Gross profit		68.1			69.2		(1.6	)		1.5
SG&A expenses excluding restructuring charges		62.3			67.7		(7.8	)		(4.7	)
Restructuring charges		1.2			—		NM
Total SG&A expenses		63.5			67.7		(6.2	)		(3.0	)
Earnings from operations		4.6			1.5		205.2
Earnings from operations excluding restructuring charges		5.8			1.5		280.2
Gross profit rate		14.9	%		15.1	%	(0.2	)	pts.
Expense rates (excluding restructuring charges):
% of revenue		13.6			14.8		(1.2	)
% of gross profit		91.6			97.8		(6.2	)
Return on sales (excluding restructuring charges)		1.2			0.3		0.9

7

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)
		June Year to Date
							%			CC %
		2016			2015		Change			Change
APAC
Commercial
Revenue from services	$	170.7		$	175.9		(2.9	)	%	3.1		%
Staffing fee-based income included in revenue from services		2.9			3.3		(12.1	)		(7.1	)
Gross profit		23.3			24.2		(3.7	)		1.2
Gross profit rate		13.7	%		13.8	%	(0.1	)	pts.
PT
Revenue from services	$	18.3		$	20.8		(12.2	)	%	(7.0	)	%
Staffing fee-based income included in revenue from services		2.8			3.1		(9.7	)		(3.3	)
Gross profit		5.0			5.6		(10.7	)		(4.9	)
Gross profit rate		27.4	%		26.9	%	0.5		pts.
Total APAC
Revenue from services	$	189.0		$	196.7		(3.9	)	%	2.1		%
Staffing fee-based income included in revenue from services		5.7			6.4		(10.9	)		(5.2	)
Gross profit		28.3			29.8		(5.0	)		0.1
Total SG&A expenses		22.7			24.4		(7.0	)		(1.4	)
Earnings from operations		5.6			5.4		3.8
Gross profit rate		15.0	%		15.2	%	(0.2	)	pts.
Expense rates:
% of revenue		12.0			12.4		(0.4	)
% of gross profit		80.3			82.0		(1.7	)
Return on sales		3.0			2.7		0.3
OCG
Revenue from services	$	342.1		$	314.5		8.8		%	9.5		%
Gross profit		85.1			71.2		19.6			20.6
Total SG&A expenses		74.9			64.9		15.5			16.7
Earnings from operations		10.2			6.3		61.3
Gross profit rate		24.9	%		22.6	%	2.3		pts.
Expense rates:
% of revenue		21.9			20.6		1.3
% of gross profit		88.0			91.1		(3.1	)
Return on sales		3.0			2.0		1.0
Corporate
Total SG&A expenses	$	49.2		$	38.2		28.8		%

8

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(In millions of dollars)
		July 3, 2016			Jan. 3, 2016			June 28, 2015
Current Assets
Cash and equivalents	$	33.3		$	42.2		$	48.7
Trade accounts receivable, less allowances of
$11.0, $10.5 and $9.4, respectively		1,079.8			1,139.1			1,152.3
Prepaid expenses and other current assets		47.8			45.8			50.6
Deferred taxes		—			—			35.8
Current assets held for sale		94.0			—			—
Total current assets		1,254.9			1,227.1			1,287.4
Noncurrent Assets
Property and equipment, net		81.5			88.9			88.6
Noncurrent deferred taxes		197.0			189.3			144.6
Goodwill, net		88.3			90.3			90.3
Other assets		368.4			344.0			321.7
Total noncurrent assets		735.2			712.5			645.2
Total Assets	$	1,990.1		$	1,939.6		$	1,932.6
Current Liabilities
Short-term borrowings	$	26.9		$	55.5		$	89.9
Accounts payable and accrued liabilities		403.7			405.5			380.4
Accrued payroll and related taxes		259.2			268.1			296.5
Accrued insurance		27.1			26.7			27.1
Income and other taxes		50.9			60.0			62.8
Current liabilities held for sale		48.0			—			—
Total current liabilities		815.8			815.8			856.7
Noncurrent Liabilities
Accrued insurance		41.1			40.0			44.3
Accrued retirement benefits		148.5			141.0			146.5
Other long-term liabilities		50.6			47.4			40.6
Total noncurrent liabilities		240.2			228.4			231.4
Stockholders' Equity
Common stock		40.1			40.1			40.1
Treasury stock		(42.1	)		(44.3	)		(49.0	)
Paid-in capital		28.1			25.4			27.5
Earnings invested in the business		828.8			813.5			774.1
Accumulated other comprehensive income		79.2			60.7			51.8
Total stockholders' equity		934.1			895.4			844.5
Total Liabilities and Stockholders' Equity	$	1,990.1		$	1,939.6		$	1,932.6
STATISTICS:
Working Capital (including net assets held for sale)	$	439.1		$	411.3		$	430.7
Current Ratio		1.5			1.5			1.5
Debt-to-capital %		2.8		%	5.8		%	9.6		%
Global Days Sales Outstanding		53			54			56

9

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE 26 WEEKS ENDED JULY 3, 2016 AND JUNE 28, 2015
(UNAUDITED)
(In millions of dollars)
		2016			2015
Cash flows from operating activities:
Net earnings	$	20.1		$	10.5
Noncash adjustments:
Depreciation and amortization		10.9			11.0
Provision for bad debts		3.5			2.1
Stock-based compensation		4.5			3.1
Other, net		(0.7	)		(0.3	)
Changes in operating assets and liabilities		2.9			(52.9	)
Net cash from (used in) operating activities		41.2			(26.5	)
Cash flows from investing activities:
Capital expenditures		(4.3	)		(6.7	)
Investment in equity affiliate		—			(0.5	)
Other investing activities		(0.4	)		(0.1	)
Net cash used in investing activities		(4.7	)		(7.3	)
Cash flows from financing activities:
Net change in short-term borrowings		(29.1	)		(1.4	)
Dividend payments		(4.8	)		(3.8	)
Other financing activities		0.2			—
Net cash used in financing activities		(33.7	)		(5.2	)
Effect of exchange rates on cash and equivalents		6.4			4.6
Net change in cash and equivalents		9.2			(34.4	)
Less: cash balance included in current assets held for sale		(18.1	)		—
Cash and equivalents at beginning of period		42.2			83.1
Cash and equivalents at end of period	$	33.3		$	48.7

10

KELLY SERVICES, INC. AND SUBSIDIARIES
REVENUE FROM SERVICES
(UNAUDITED)
(In millions of dollars)
		Second Quarter (Commercial, PT and OCG)
					%			CC %
		2016		2015	Change			Change
Americas
United States	$	930.8	$	923.6	0.8		%	0.8		%
Canada		35.8		41.6	(14.1	)		(10.6	)
Mexico		25.4		32.0	(20.2	)		(5.5	)
Puerto Rico		22.5		26.6	(15.3	)		(15.3	)
Brazil		10.2		9.9	3.8			20.6
Total Americas		1,024.7		1,033.7	(0.9	)		(0.1	)
EMEA
France		61.3		60.9	0.7			(1.2	)
Switzerland		54.6		54.6	(0.1	)		3.0
Portugal		38.7		33.9	14.5			12.1
United Kingdom		23.1		27.1	(15.0	)		(9.2	)
Russia		16.6		22.2	(25.3	)		(6.8	)
Germany		15.7		14.3	9.2			7.0
Italy		15.1		13.0	16.0			13.9
Norway		8.4		10.0	(15.6	)		(10.0	)
Other		14.8		10.3	44.3			42.2
Total EMEA		248.3		246.3	0.8			2.9
APAC
Singapore		33.0		33.0	0.2			1.3
Australia		32.1		32.9	(2.3	)		2.0
Malaysia		14.5		15.9	(9.6	)		(0.8	)
New Zealand		9.5		10.3	(7.7	)		(1.9	)
Other		13.4		12.9	3.7			8.6
Total APAC		102.5		105.0	(2.4	)		1.8
Total Kelly Services, Inc.	$	1,375.5	$	1,385.0	(0.7	)	%	0.6		%

11

KELLY SERVICES, INC. AND SUBSIDIARIES
REVENUE FROM SERVICES
(UNAUDITED)
(In millions of dollars)
		June Year to Date (Commercial, PT and OCG)
					%			CC %
		2016		2015	Change			Change
Americas
United States	$	1,865.5	$	1,806.6	3.3		%	3.3		%
Canada		70.3		84.3	(16.6	)		(10.6	)
Mexico		52.0		63.9	(18.5	)		(2.6	)
Puerto Rico		45.0		51.4	(12.5	)		(12.5	)
Brazil		20.2		23.8	(14.9	)		11.7
Total Americas		2,053.0		2,030.0	1.1			2.2
EMEA
France		117.8		117.3	0.5			0.6
Switzerland		101.2		102.7	(1.5	)		2.0
Portugal		72.4		65.2	11.1			11.2
United Kingdom		46.7		50.7	(8.1	)		(2.1	)
Germany		31.1		27.7	12.1			12.3
Russia		30.6		40.4	(24.3	)		(7.8	)
Italy		28.5		25.5	11.6			11.5
Norway		16.0		19.4	(17.1	)		(9.6	)
Other		28.5		21.3	33.9			34.6
Total EMEA		472.8		470.2	0.5			3.8
APAC
Singapore		64.8		64.3	0.8			2.9
Australia		60.6		63.3	(4.3	)		2.0
Malaysia		27.7		31.4	(11.9	)		(0.9	)
New Zealand		19.2		20.8	(7.8	)		1.3
Other		26.5		25.6	3.6			10.7
Total APAC		198.8		205.4	(3.2	)		2.9
Total Kelly Services, Inc.	$	2,724.6	$	2,705.6	0.7		%	2.5		%

12

KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
FOR THE 13 WEEKS ENDED JULY 3, 2016 AND JUNE 28, 2015
(UNAUDITED)
(In millions of dollars except per share data)
		2016							2015
		As Reported		Restructuring Charges (Note 1)			Adjusted Earnings		Reported Earnings	% Change
Revenue from services	$	1,375.5	$	—		$	1,375.5	$	1,385.0	(0.7	)	%
Cost of services		1,145.0		—			1,145.0		1,162.7	(1.5	)
Gross profit		230.5		—			230.5		222.3	3.7
SG&A expenses		220.6		(3.4	)		217.2		210.8	3.0
Earnings from operations		9.9		3.4			13.3		11.5	15.9
Other expense, net		0.2		—			0.2		1.0	(74.8	)
Earnings before taxes		9.7		3.4			13.1		10.5	24.4
Inc. tax expense (benefit)		0.8		0.9			1.7		3.7	(55.5	)
Net earnings	$	8.9	$	2.5		$	11.4	$	6.8	68.1		%
Earnings per share:
Basic	$	0.23	$	0.07		$	0.29	$	0.18	61.1		%
Diluted	$	0.23	$	0.07		$	0.29	$	0.18	61.1		%
Note: Earnings per share amounts for each quarter are required to be computed independently and may not equal the amounts computed for the total year.

13

KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
FOR THE 26 WEEKS ENDED JULY 3, 2016 AND JUNE 28, 2015
(UNAUDITED)
(In millions of dollars except per share data)
		2016							2015
		As Reported		Restructuring Charges (Note 1)			Adjusted Earnings		Reported Earnings	% Change
Revenue from services	$	2,724.6	$	—		$	2,724.6	$	2,705.6	0.7		%
Cost of services		2,261.4		—			2,261.4		2,263.0	(0.1	)
Gross profit		463.2		—			463.2		442.6	4.6
SG&A expenses		438.6		(3.4	)		435.2		419.0	3.8
Earnings from operations		24.6		3.4			28.0		23.6	18.8
Other expense, net		1.0		—			1.0		3.5	(70.9	)
Earnings before taxes		23.6		3.4			27.0		20.1	34.4
Inc. tax expense (benefit)		3.5		0.9			4.4		9.6	(54.5	)
Net earnings	$	20.1	$	2.5		$	22.6	$	10.5	115.0		%
Earnings per share:
Basic	$	0.52	$	0.07		$	0.58	$	0.27	114.8		%
Diluted	$	0.51	$	0.07		$	0.58	$	0.27	114.8		%
Note: Earnings per share amounts for each quarter are required to be computed independently and may not equal the amounts computed for the total year.

14

KELLY SERVICES, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP MEASURES

(UNAUDITED)

Management believes that the non-GAAP (Generally Accepted Accounting Principles) information excluding the restructuring charges is useful to understand the Company's fiscal 2016 financial performance and increases comparability. Specifically, Management believes that removing the impact of restructuring charges allows for a more meaningful comparison of current period operating performance with the operating results of prior periods. These non-GAAP measures may have limitations as analytical tools because they exclude items which can have a material impact on cash flow and earnings per share. As a result, Management considers these measures, along with reported results, when it reviews and evaluates the Company's financial performance. Management believes that these measures provide greater transparency to investors and provide insight into how Management is evaluating the Company's financial performance. Non-GAAP measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.

(1) Restructuring charges in 2016 include costs related to actions during the second quarter in the Americas and EMEA designed to increase operational efficiency and align our staffing operations with opportunities for growth within their markets.

15