Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Apr. 04, 2021 | May 03, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Apr. 4, 2021 | |
Document Transition Report | false | |
Entity File Number | 0-1088 | |
Entity Registrant Name | KELLY SERVICES, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 38-1510762 | |
Entity Address, Address Line One | 999 West Big Beaver Road | |
Entity Address, City or Town | Troy | |
Entity Address, State or Province | MI | |
Entity Address, Postal Zip Code | 48084 | |
City Area Code | 248 | |
Local Phone Number | 362-4444 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Current Fiscal Year End Date | --01-02 | |
Amendment Flag | false | |
Entity Central Index Key | 0000055135 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 36,010,525 | |
Class B Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 3,358,521 | |
NASDAQ Global Market | Class A Common Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Class A Common | |
Trading Symbol | KELYA | |
Security Exchange Name | NASDAQ | |
NASDAQ Global Market | Class B Common Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Class B Common | |
Trading Symbol | KELYB | |
Security Exchange Name | NASDAQ |
Contingencies
Contingencies | 3 Months Ended |
Apr. 04, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies The Company is continuously engaged in litigation, threatened litigation, claims, audits or investigations arising in the ordinary course of its business, such as matters alleging employment discrimination, wage and hour violations, claims for indemnification or liability, violations of privacy rights, anti-competition regulations, commercial and contractual disputes, and tax related matters which could result in a material adverse outcome. We record accruals for loss contingencies when we believe it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Such accruals are recorded in accounts payable and accrued liabilities and in accrued workers’ compensation and other claims in the consolidated balance sheet. At first quarter-end 2021 and year-end 2020, the gross accrual for litigation costs amounted to $1.2 million and $1.4 million, respectively. The Company maintains insurance coverage which may cover certain claims. When claims exceed the applicable policy deductible and realization of recovery of the claim from existing insurance policies is deemed probable, the Company records receivables from the insurance company for the excess amount, which are included in prepaid expenses and other current assets in the consolidated balance sheet. At first quarter-end 2021 and year-end 2020, there were no related insurance receivables. The Company estimates the aggregate range of reasonably possible losses, in excess of amounts accrued, is $0.1 million to $1.8 million as of first quarter-end 2021. This range includes matters where a liability has been accrued but it is reasonably possible that the ultimate loss may exceed the amount accrued and for matters where a loss is believed to be reasonably possible, but a liability has not been accrued. The aggregate range only represents matters in which we are currently able to estimate a range of loss and does not represent our maximum loss exposure. The estimated range is subject to significant judgment and a variety of assumptions and only based upon currently available information. For other matters, we are currently not able to estimate the reasonably possible loss or range of loss. While the ultimate outcome of these matters cannot be predicted with certainty, we believe that the resolution of any such proceedings will not have a material adverse effect on our financial condition, results of operations or cash flows. |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
Apr. 04, 2021 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Recently Adopted In January 2020, the FASB issued ASU 2020-01 which clarifies the interaction of rules for equity securities, the equity method of accounting, and forward contracts and purchase options on certain types of securities. The guidance clarifies how to account for the transition into and out of the equity method of accounting when considering observable transactions under the measurement alternative. The ASU is effective for annual reporting periods beginning after December 15, 2020, including interim reporting periods within those annual periods, with early adoption permitted. The adoption of this standard did not have a material impact to our consolidated financial statements. In December 2019, the FASB issued ASU 2019-12 simplifying various aspects related to the accounting for income taxes. The guidance removes exceptions to the general principles in Topic 740 related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The ASU is effective for annual reporting periods beginning after December 15, 2020, including interim reporting periods within those annual periods, with early adoption permitted. The adoption of this standard did not have a material impact to our consolidated financial statements. Management has evaluated other recently issued accounting pronouncements and does not believe that any of these pronouncements will have a significant impact on our consolidated financial statements and related disclosures. |
Consolidated Statements of Earn
Consolidated Statements of Earnings (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Revenue from services | $ 1,205.9 | $ 1,261.1 |
Cost of services | 992.6 | 1,037.8 |
Gross profit | 213.3 | 223.3 |
Selling, general and administrative expenses | 202.7 | 219.5 |
Goodwill impairment charge | 0 | 147.7 |
Gain on sale of assets | 0 | (32.1) |
Earnings (loss) from operations | 10.6 | (111.8) |
Gain (loss) on investment in Persol Holdings | 30 | (77.8) |
Other income (expense), net | (3.4) | 1.7 |
Earnings (loss) before taxes and equity in net earnings (loss) of affiliate | 37.2 | (187.9) |
Income tax expense (benefit) | 10.5 | (36.2) |
Net earnings (loss) before equity in net earnings (loss) of affiliate | 26.7 | (151.7) |
Equity in net earnings (loss) of affiliate | (1.1) | (1.5) |
Net earnings (loss) | $ 25.6 | $ (153.2) |
Basic earnings (loss) per share (in dollars per share) | $ 0.65 | $ (3.91) |
Diluted earnings (loss) per share (in dollars per share) | $ 0.64 | $ (3.91) |
Average shares outstanding (millions): | ||
Basic (in shares) | 39.3 | 39.2 |
Diluted (in shares) | 39.5 | 39.2 |
Service | ||
Revenue from services | $ 1,205.9 | $ 1,261.1 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Net earnings (loss) | $ 25.6 | $ (153.2) |
Other comprehensive income (loss), net of tax: | ||
Foreign currency translation adjustments, net of tax expense of $0.5 and $0.1, respectively | (13.6) | (7.4) |
Less: Reclassification adjustments included in net earnings (loss) | 0 | 0 |
Foreign currency translation adjustments | (13.6) | (7.4) |
Other comprehensive income (loss) | (13.6) | (7.4) |
Comprehensive income (loss) | $ 12 | $ (160.6) |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Foreign currency translation adjustments, tax expense (benefit) | $ 0.5 | $ 0.1 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Apr. 04, 2021 | Jan. 03, 2021 |
Current Assets | ||
Cash and equivalents | $ 239.4 | $ 223 |
Trade accounts receivable, less allowances of $12.6 and $13.3, respectively | 1,279.7 | 1,265.2 |
Prepaid expenses and other current assets | 76.5 | 61.4 |
Total current assets | 1,595.6 | 1,549.6 |
Property and equipment: | ||
Property and equipment | 215.4 | 222.3 |
Accumulated depreciation | (176.5) | (181.3) |
Net property and equipment | 38.9 | 41 |
Operating lease right-of-use assets | 79 | 83.2 |
Deferred taxes | 286.4 | 282 |
Goodwill, net | 3.5 | 3.5 |
Investment in Persol Holdings | 181.7 | 164.2 |
Investment in equity affiliate | 118.7 | 118.5 |
Other assets | 306.3 | 319.9 |
Total noncurrent assets | 1,014.5 | 1,012.3 |
Total Assets | 2,610.1 | 2,561.9 |
Current Liabilities | ||
Short-term borrowings | 1.1 | 0.3 |
Accounts payable and accrued liabilities | 554.3 | 536.8 |
Operating lease liabilities | 18.8 | 19.6 |
Accrued payroll and related taxes | 309.9 | 293 |
Accrued workers’ compensation and other claims | 21.9 | 22.7 |
Income and other taxes | 56.9 | 53.2 |
Total current liabilities | 962.9 | 925.6 |
Noncurrent Liabilities | ||
Operating lease liabilities | 63.9 | 67.5 |
Accrued payroll and related taxes | 58.5 | 58.5 |
Accrued workers’ compensation and other claims | 40.7 | 42.2 |
Accrued retirement benefits | 204.7 | 205.8 |
Other long-term liabilities | 63.7 | 59.3 |
Total noncurrent liabilities | 431.5 | 433.3 |
Commitments and contingencies (see Contingencies footnote) | ||
Treasury stock, at cost | ||
Paid-in capital | 20.6 | 21.3 |
Earnings invested in the business | 1,188.5 | 1,162.9 |
Accumulated other comprehensive income (loss) | (17.8) | (4.2) |
Total stockholders’ equity | 1,215.7 | 1,203 |
Total Liabilities and Stockholders’ Equity | 2,610.1 | 2,561.9 |
Class A Common Stock | ||
Capital stock, $1.00 par value | ||
Common stock, value | 36.7 | 36.7 |
Treasury stock, at cost | ||
Treasury stock, value | (15.1) | (16.5) |
Class B Common Stock | ||
Capital stock, $1.00 par value | ||
Common stock, value | 3.4 | 3.4 |
Treasury stock, at cost | ||
Treasury stock, value | $ (0.6) | $ (0.6) |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) shares in Millions, $ in Millions | Apr. 04, 2021 | Jan. 03, 2021 |
Allowance for trade accounts receivables | $ 12.6 | $ 13.3 |
Class A Common Stock | ||
Capital stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 100 | 100 |
Common stock, shares issued (in shares) | 36.7 | 36.7 |
Treasury stock, common stock (in shares) | 0.7 | 0.8 |
Class B Common Stock | ||
Capital stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 10 | 10 |
Common stock, shares issued (in shares) | 3.4 | 3.4 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Millions | Total | Common StockCapital Stock, Class A common stock | Common StockCapital Stock, Class B common stock | Treasury StockTreasury Stock, Class A common stock | Treasury StockTreasury Stock, Class B common stock | Paid-in Capital | Earnings Invested in the Business | Accumulated Other Comprehensive Income (Loss) | Cumulative Effect, Period of Adoption, AdjustmentEarnings Invested in the Business |
Stockholders' Equity Attributable to Parent, Beginning Balance at Dec. 29, 2019 | $ 36.6 | $ 3.5 | $ (20.3) | $ (0.6) | $ 22.5 | $ 1,238.6 | $ (15.8) | $ (0.7) | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Net issuance of stock awards | 2.9 | 0 | (3) | ||||||
Net earnings (loss) | $ (153.2) | (153.2) | |||||||
Dividends | (3) | ||||||||
Other comprehensive income (loss), net of tax | (7.4) | (7.4) | |||||||
Stockholders' Equity Attributable to Parent, Ending Balance at Mar. 29, 2020 | 1,100.1 | 36.6 | 3.5 | (17.4) | (0.6) | 19.5 | 1,081.7 | (23.2) | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Earnings invested in the business | 1,162.9 | ||||||||
Stockholders' Equity Attributable to Parent, Beginning Balance at Jan. 03, 2021 | 1,203 | 36.7 | 3.4 | (16.5) | (0.6) | 21.3 | 1,162.9 | (4.2) | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Net issuance of stock awards | 1.4 | 0 | (0.7) | ||||||
Net earnings (loss) | 25.6 | 25.6 | |||||||
Dividends | 0 | ||||||||
Other comprehensive income (loss), net of tax | (13.6) | (13.6) | |||||||
Stockholders' Equity Attributable to Parent, Ending Balance at Apr. 04, 2021 | 1,215.7 | $ 36.7 | $ 3.4 | $ (15.1) | $ (0.6) | $ 20.6 | $ 1,188.5 | $ (17.8) | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Earnings invested in the business | $ 1,188.5 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Cash flows from operating activities: | ||
Net earnings (loss) | $ 25.6 | $ (153.2) |
Adjustments to reconcile net earnings (loss) to net cash from operating activities: | ||
Goodwill impairment charge | 0 | 147.7 |
Deferred income taxes on goodwill impairment charge | 0 | (23) |
Depreciation and amortization | 5.9 | 6 |
Operating lease asset amortization | 5.2 | 5.3 |
Provision for credit losses and sales allowances | (0.1) | (0.4) |
Stock-based compensation | 1.4 | 1.2 |
(Gain) loss on investment in Persol Holdings | (30) | 77.8 |
Gain on sale of assets | 0 | (32.1) |
Equity in net (earnings) loss of PersolKelly Pte. Ltd. | 1.1 | 1.5 |
Other, net | 1.3 | 0.7 |
Changes in operating assets and liabilities, net of acquisitions | 0.1 | (23.1) |
Net cash from operating activities | 10.5 | 8.4 |
Cash flows from investing activities: | ||
Capital expenditures | (2.7) | (3) |
Proceeds from company-owned life insurance | 10.4 | 0 |
Proceeds from sale of assets | 0 | 55.5 |
Acquisition of companies, net of cash received | 0 | (36.3) |
Investment in equity securities | 0 | (0.3) |
Other investing activities | 0.2 | 0 |
Net cash from investing activities | 7.9 | 15.9 |
Cash flows from financing activities: | ||
Net change in short-term borrowings | 0.8 | (0.1) |
Financing lease payments | (0.2) | (0.3) |
Payments of tax withholding for stock awards | (0.5) | (1.1) |
Dividend payments | 0 | (3) |
Other financing activities | 0 | (0.1) |
Net cash from (used in) financing activities | 0.1 | (4.6) |
Effect of exchange rates on cash, cash equivalents and restricted cash | (1.4) | 2.8 |
Net change in cash, cash equivalents and restricted cash | 17.1 | 22.5 |
Cash, cash equivalents and restricted cash at beginning of period | 228.1 | 31 |
Cash, cash equivalents and restricted cash at end of period | 245.2 | 53.5 |
Cash and cash equivalents | 239.4 | 48.3 |
Restricted cash included in prepaid expenses and other current assets | 0.2 | 0.2 |
Restricted cash included in other assets | $ 5.6 | $ 5 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Apr. 04, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements of Kelly Services, Inc. (the “Company,” “Kelly,” “we” or “us”) have been prepared in accordance with Rule 10-01 of Regulation S-X and do not include all the information and notes required by generally accepted accounting principles (“GAAP”) for complete financial statements. In the opinion of management, all adjustments, including normal recurring adjustments, necessary for a fair statement of the results of the interim periods, have been made. The results of operations for such interim periods are not necessarily indicative of results of operations for a full year. The unaudited consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto for the fiscal year ended January 3, 2021, included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 18, 2021 (the 2020 consolidated financial statements). The Company’s first fiscal quarter ended on April 4, 2021 (2021) and March 29, 2020 (2020), each of which contained 13 weeks. As discussed in the Segment Disclosures footnote, the Company changed its reportable segments during the third quarter of 2020. As a result, certain reclassifications have been made to the financial statements for the first quarter of 2020 to conform to our updated reportable segment presentation. |
Revenue
Revenue | 3 Months Ended |
Apr. 04, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Revenue Disaggregated by Service Type Kelly has five specialty segments: Professional & Industrial (“P&I”), Science, Engineering & Technology (“SET”), Education, Outsourcing & Consulting Group ("Outsourcing & Consulting," "OCG") and International. Other than OCG, each segment delivers talent through staffing services, permanent placement or outcome-based services. Our OCG segment delivers talent solutions including managed service provider ("MSP"), payroll process outsourcing ("PPO"), recruitment process outsourcing ("RPO"), and talent advisory services. International also delivers RPO talent solutions within its local markets. The following table presents our segment revenues disaggregated by service type (in millions): First Quarter 2021 2020 Professional & Industrial Staffing services $ 352.5 $ 388.4 Permanent placement 4.9 3.0 Outcome-based services 110.2 102.4 Total Professional & Industrial 467.6 493.8 Science, Engineering & Technology Staffing services 186.2 199.2 Permanent placement 4.8 3.4 Outcome-based services 63.7 67.6 Total Science, Engineering & Technology 254.7 270.2 Education Staffing services 110.8 142.4 Permanent placement 0.8 0.1 Total Education 111.6 142.5 Outsourcing & Consulting Talent solutions 99.3 89.5 Total Outsourcing & Consulting 99.3 89.5 International Staffing services 265.6 259.5 Permanent placement 5.5 5.7 Talent solutions 1.8 — Total International 272.9 265.2 Total Intersegment (0.2) (0.1) Total Revenue from Services $ 1,205.9 $ 1,261.1 Revenue Disaggregated by Geography Our operations are subject to different economic and regulatory environments depending on geographic location. Our P&I and Education segments operate in the Americas region, our SET segment operates in the Americas and Europe regions, and OCG operates in the Americas, Europe and Asia-Pacific regions. The International segment includes Europe and our Brazil and Mexico operations, which are included in the Americas region. Our Brazil operations were sold in August 2020 (see Acquisitions and Disposition footnote). The below table presents our revenues disaggregated by geography (in millions): First Quarter 2021 2020 Americas United States $ 858.5 $ 928.5 Mexico 34.6 28.7 Canada 34.1 32.8 Puerto Rico 24.2 17.7 Brazil — 9.1 Total Americas Region 951.4 1,016.8 Europe France 54.3 52.5 Switzerland 52.7 44.2 Portugal 43.7 43.6 Russia 32.6 32.1 Italy 18.1 14.7 United Kingdom 17.0 22.3 Germany 7.1 8.0 Ireland 5.1 5.0 Other 15.6 15.2 Total Europe Region 246.2 237.6 Total Asia-Pacific Region 8.3 6.7 Total Kelly Services, Inc. $ 1,205.9 $ 1,261.1 The below table presents our SET, OCG and International segment revenues disaggregated by geographic region (in millions): First Quarter 2021 2020 Science, Engineering & Technology Americas $ 253.2 $ 268.4 Europe 1.5 1.8 Total Science, Engineering & Technology $ 254.7 $ 270.2 Outsourcing & Consulting Americas $ 84.8 $ 74.6 Europe 6.2 8.2 Asia-Pacific 8.3 6.7 Total Outsourcing & Consulting $ 99.3 $ 89.5 International Americas $ 34.3 $ 37.6 Europe 238.6 227.6 Total International $ 272.9 $ 265.2 Deferred Costs Deferred sales commissions, which are included in other assets in the consolidated balance sheet, were $1.0 million as of first quarter-end 2021 and year-end 2020. Amortization expense for the deferred costs for the first quarter 2021 was $0.2 million and in the first quarter 2020 was $0.3 million. |
Credit Losses
Credit Losses | 3 Months Ended |
Apr. 04, 2021 | |
Credit Loss [Abstract] | |
Credit Losses | Credit Losses On December 30, 2019, we adopted Accounting Standards Codification ("ASC") Topic 326 using the modified retrospective method for all financial assets measured at amortized cost and off-balance-sheet credit exposures, as applicable. The rollforward of our allowance for credit losses related to trade accounts receivable, which is recorded in trade accounts receivable, less allowance in the consolidated balance sheet, is as follows (in millions): First Quarter 2021 2020 Allowance for credit losses: Beginning balance $ 9.8 $ 9.7 Impact of adopting ASC 326 — 0.3 Current period provision (0.2) (0.4) Currency exchange effects (0.2) (0.5) Write-offs (0.3) (0.2) Ending balance $ 9.1 $ 8.9 Write-offs are presented net of recoveries, which were not material for first quarter-end 2020 and 2021. We are engaged in litigation with a customer over a disputed accounts receivable balance of approximately $10 million for certain services rendered more than five years ago, which is recorded as a long-term receivable in other assets in the consolidated balance sheet. In September 2020, a ruling was issued in favor of the customer, which we have appealed. Upon receiving the ruling, we increased our allowance for credit losses by $9.2 million to reflect the likelihood of collection, which is recorded in other assets in the consolidated balance sheet. The rollforward of our allowance for credit losses related to the long-term customer receivable, which is recorded in other assets in the consolidated balance sheet, is as follows (in millions): First Quarter 2021 2020 Allowance for credit losses: Beginning balance $ 10.9 $ 1.0 Impact of adopting ASC 326 — 0.7 Current period provision — — Currency exchange effects — — Ending Balance $ 10.9 $ 1.7 We are also exposed to credit losses from our loan to PersolKelly Pte. Ltd. and other receivables measured at amortized cost. No other allowances related to the loan or other receivables were material for first quarter-end 2021. See Investment in PersolKelly Pte. Ltd. footnote for more information on the loan to PersolKelly Pte. Ltd. |
Acquisitions and Disposition
Acquisitions and Disposition | 3 Months Ended |
Apr. 04, 2021 | |
Business Combinations [Abstract] | |
Acquisitions and Disposition | Acquisitions and Disposition Acquisitions In the first quarter of 2020, Kelly Services USA ("KSU"), LLC, a wholly owned subsidiary of the Company, acquired Insight Workforce Solutions LLC and its affiliate, Insight EDU LLC (collectively, "Insight"), as detailed below. In the fourth quarter of 2020, KSU acquired Greenwood/Asher & Associates, LLC ("Greenwood/Asher"), as detailed below. Greenwood/Asher On November 18, 2020, KSU acquired 100% of the membership interests of Greenwood/Asher, a premier specialty education executive search firm in the U.S., for a purchase price of $3.5 million. Under terms of the purchase agreement, the purchase price was adjusted for cash held by Greenwood/Asher at the closing date and estimated working capital adjustments resulting in the Company paying cash of $5.2 million. The purchase price of the acquisition also included contingent consideration with an estimated fair value of $2.1 million related to an earnout payment in the event certain conditions are met per the terms of the agreement. The initial fair value of the earnout was established using a Black Scholes model and the liability is recorded in accounts payable and accrued liabilities and other noncurrent liabilities in the consolidated balance sheet (see Fair Value Measurements footnote). Subsequently, the earnout was revalued, resulting in a decrease to the liability of $0.4 million in the first quarter of 2021. The earnout is expected to be paid in 2022 and 2023 after each earnout year pursuant to the terms of the purchase agreement. The purchase price allocation for this acquisition is preliminary and could change. Goodwill generated from the acquisition was primarily attributable to the expected synergies from combining operations and expanding market potential, and was assigned to the Education reporting unit (see Goodwill footnote). The amount of goodwill expected to be deductible for tax purposes is approximately $0.9 million. Insight On January 14, 2020, Kelly Services USA, LLC acquired 100% of the membership interests of Insight, an educational staffing company in the U.S, for a purchase price of $34.5 million. Under terms of the purchase agreement, the purchase price was adjusted for cash held by Insight at the closing date and estimated working capital adjustments resulting in the Company paying cash of $38.1 million. The purchase price of the acquisition also included contingent consideration with an estimated fair value of $1.6 million related to an earnout payment in the event certain conditions are met per the terms of the agreement. The initial fair value of the earnout was established using a Monte Carlo simulation and the liability is recorded in accounts payable and accrued liabilities in the consolidated balance sheet (see Fair Value Measurements footnote). Subsequently, the earnout was revalued, resulting in a net increase to the liability of $0.1 million in 2020 and there were no material adjustments to the liability in the first quarter of 2021. In the second quarter of 2020, the Company paid a working capital adjustment of $0.1 million. As of year-end 2020, the purchase price allocation for this acquisition is final. Goodwill generated from the acquisition was primarily attributable to the expected synergies from combining operations and expanding market potential, and was assigned to the former Americas Staffing reporting unit. The goodwill related to this acquisition was included in the goodwill impairment charge taken in the first quarter of 2020. The goodwill impairment charge resulted from an interim goodwill impairment test triggered by declines in our common stock price as a result of negative market reaction to the COVID-19 crisis (see Goodwill footnote). The amount of goodwill expected to be deductible for tax purposes is approximately $18.6 million. Disposition On August 18, 2020, the Company sold its Brazil operations for a purchase price of $1.4 million. The Company received cash proceeds of $1.2 million, net of cash disposed. As a part of the transaction, the Company has agreed to indemnify the buyer for losses and costs incurred in connection with certain events or occurrences initiated within a six-year period after closing. The aggregate losses for which the Company will provide indemnification shall not exceed $8.8 million. Accordingly, the Company recorded an indemnification liability of $2.5 million at the time of disposition in other long-term liabilities in the consolidated balance sheet, which represented the fair value of the liability (see Fair Value Measurements footnote) and completely offset the gain on the sale. |
Investment in Persol Holdings
Investment in Persol Holdings | 3 Months Ended |
Apr. 04, 2021 | |
Investment in Persol Holdings [Abstract] | |
Investment in Persol Holdings | Investment in Persol HoldingsThe Company has a yen-denominated investment through the Company's subsidiary, Kelly Services Japan, Inc., in the common stock of Persol Holdings Co., Ltd. ("Persol Holdings"), the 100% owner of Persol Asia Pacific Pte. Ltd., the Company’s joint venture partner in PersolKelly Pte. Ltd. (the "JV"). As our investment is a noncontrolling interest in Persol Holdings, this investment is recorded at fair value based on the quoted market price of Persol Holdings stock on the Tokyo Stock Exchange as of the period end (see Fair Value Measurements footnote). A gain on the investment of $30.0 million in the first quarter of 2021 and a loss on the investment of $77.8 million in the first quarter of 2020 was recorded in gain (loss) on investment in Persol Holdings in the consolidated statements of earnings. |
Investment in PersolKelly Pte L
Investment in PersolKelly Pte Ltd. | 3 Months Ended |
Apr. 04, 2021 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in PersolKelly Pte Ltd. | Investment in PersolKelly Pte. Ltd. The Company has a 49% ownership interest in the JV (see Investment in Persol Holdings footnote above), a staffing services business operating in ten geographies in the Asia-Pacific region. The operating results of the Company’s interest in the JV are accounted for on a one-quarter lag under the equity method and are reported in equity in net earnings (loss) of affiliate in the consolidated statements of earnings, which amounted to a loss of $1.1 million in the first quarter of 2021 and a loss of $1.5 million in the first quarter of 2020. This investment is evaluated for indicators of impairment on a quarterly basis or whenever events or circumstances indicate the carrying amount may be other-than-temporarily impaired. If we conclude that there is an other-than-temporary impairment of this equity investment, we will adjust the carrying amount of the investment to the current fair value. The investment in equity affiliate on the Company’s consolidated balance sheet totaled $118.7 million as of first quarter-end 2021 and $118.5 million as of year-end 2020. The net amount due from the JV, a related party, was $5.2 million as of the first quarter-end 2021 and $5.6 million as of year-end 2020. The Company made loans in prior years, proportionate to its 49% ownership, to the JV to fund working capital requirements as a result of their sustained revenue growth. As of first quarter-end 2021, the outstanding loan balance is $5.8 million and is recorded in prepaid expenses and other current assets in the consolidated balance sheet and included in the net amounts due from the JV. The carrying value of the loan approximates the fair value based on market interest rates. The allowance for credit losses related to the loan is not material as of the first quarter-end 2021. The Company received payment from the JV for the remaining balance of the loan in April 2021. Accrued interest receivable, which is included in prepaid expenses and other current assets in the consolidated balance sheet, was not material at first quarter-end 2021 and year-end 2020. The JV is a supplier to certain MSP programs in the region and the |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Apr. 04, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Trade accounts receivable, short-term borrowings, accounts payable, accrued liabilities and accrued payroll and related taxes approximate their fair values due to the short-term maturities of these assets and liabilities. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following tables present assets and liabilities measured at fair value on a recurring basis as of first quarter-end 2021 and year-end 2020 in the consolidated balance sheet by fair value hierarchy level, as described below. Level 1 measurements consist of unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 measurements include quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the asset or liability. Level 3 measurements include significant unobservable inputs. As of First Quarter-End 2021 Description Total Level 1 Level 2 Level 3 (In millions of dollars) Money market funds $ 5.6 $ 5.6 $ — $ — Investment in Persol Holdings 181.7 181.7 — — Total assets at fair value $ 187.3 $ 187.3 $ — $ — Brazil indemnification $ (2.4) $ — $ — $ (2.4) Greenwood/Asher earnout (1.7) — — (1.7) Insight earnout (1.7) — — (1.7) Total liabilities at fair value $ (5.8) $ — $ — $ (5.8) As of Year-End 2020 Description Total Level 1 Level 2 Level 3 (In millions of dollars) Money market funds $ 120.3 $ 120.3 $ — $ — Investment in Persol Holdings 164.2 164.2 — — Total assets at fair value $ 284.5 $ 284.5 $ — $ — Brazil indemnification $ (2.6) $ — $ — $ (2.6) Greenwood/Asher earnout (2.1) — — (2.1) Insight earnout (1.7) — — (1.7) Total liabilities at fair value $ (6.4) $ — $ — $ (6.4) Money market funds represent investments in money market funds that hold government securities, of which $5.6 million as of first quarter-end 2021 and $5.1 million as of year-end 2020, are restricted as to use and are included in other assets in the consolidated balance sheet. The money market funds that are restricted as to use account for the majority of our restricted cash balance and represents cash balances that are required to be maintained to fund disability claims in California. The remaining money market funds as of year-end 2020 are included in cash and equivalents in the consolidated balance sheet. The valuations of money market funds are based on quoted market prices of those accounts as of the respective period end. The decrease in money market funds from year-end 2020 resulted from the transfer to other cash and cash equivalent accounts at the end of the first quarter of 2021. The valuation of the investment in Persol Holdings is based on the quoted market price of Persol Holdings stock on the Tokyo Stock Exchange as of the period end, and the related changes in fair value are recorded in the consolidated statements of earnings (see Investment in Persol Holdings footnote). The cost of this yen-denominated investment, which fluctuates based on foreign exchange rates, was $18.7 million as of the first quarter-end 2021 and $20.1 million at year-end 2020. As of first quarter-end 2021 and year-end 2020, the Company had an indemnification liability of $2.4 million and $2.6 million, respectively, in other long-term liabilities on the consolidated balance sheet related to the sale of the Brazil operations (see Acquisitions and Disposition footnote). The valuation of the indemnification liability was established using a discounted cash flow methodology based on probability weighted-average cash flows discounted by weighted-average cost of capital. The valuation, which represents the fair value, is considered a level 3 liability, and is being measured on a recurring basis. During the first quarter of 2021, the Company recorded a reduction of $0.2 million to the indemnification liability related to exchange rate fluctuations in other income (expense), net in the consolidated statements of earnings. The Company recorded an earnout liability relating to the 2020 acquisition of Insight, totaling $1.7 million at first quarter-end 2021 and year-end 2020 in accounts payable and accrued liabilities in the consolidated balance sheet (see Acquisitions and Disposition footnote). The valuation of the earnout liability was initially established using a Monte Carlo simulation and represents the fair value and is considered a level 3 liability. The Company recorded an earnout liability relating to the 2020 acquisition of Greenwood/Asher, totaling $1.7 million at first quarter-end 2021 in accounts payable and accrued liabilities and other long-term liabilities in the consolidated balance sheet and $2.1 million as of year-end 2020 in other long-term liabilities in the consolidated balance sheet (see Acquisitions and Dispositions footnote). The initial valuation of the earnout liability was established using a Black Scholes model and represents the fair value and is considered a level 3 liability. During the first quarter of 2021, the Company recorded a reduction of $0.4 million to the earnout liability in SG&A expenses in the consolidated statements of earnings. Equity Investment Without Readily Determinable Fair Value The Company has a minority investment in Business Talent Group, LLC, which is included in other assets in the consolidated balance sheet. This investment is measured using the measurement alternative for equity investments without a readily determinable fair value. The measurement alternative represents cost, less impairment, plus or minus observable price changes. The carrying amount of $5.0 million as of the first quarter-end 2021 and year-end 2020 represents the purchase price. There have been no material price changes to the carrying amount or impairments. The Company has a minority investment in Kenzie Academy Inc., which is included in other assets in the consolidated balance sheet. The investment was also measured using the measurement alternative for equity investments without a readily determinable fair value as described above. On March 8, 2021, Kenzie entered into a transaction to sell its assets. As of the date of the sale and year-end 2020, the investment had a carrying value of $1.4 million, representing total cost plus observable price changes to date. The asset was written down as a result of the sale and the loss of $1.4 million was recorded in other income (expense), net in the consolidated statements of earnings. Assets Measured at Fair Value on a Nonrecurring Basis Due to the negative market reaction to the COVID-19 crisis, including declines in our common stock price, management determined that a triggering event occurred during the first quarter of 2020. We therefore performed an interim step one quantitative impairment test for both of our previous reporting units with goodwill. As a result of this quantitative assessment, we determined that the estimated fair value of the reporting units no longer exceeded the carrying value, and recorded a goodwill impairment charge of $147.7 million in the first quarter of 2020 (see Goodwill footnote). |
Restructuring
Restructuring | 3 Months Ended |
Apr. 04, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | RestructuringThere were no restructuring charges incurred in the first quarter of 2021. In the first quarter of 2020, the Company took restructuring actions to align costs with expected revenues, position the organization to adopt a new operating model in the third quarter of 2020 and to align the U.S. branch network facilities footprint with a more technology-enabled service delivery methodology. Restructuring costs incurred in the first quarter of 2020 totaled $8.7 million and were recorded entirely in SG&A expenses in the consolidated statements of earnings, as detailed below (in millions of dollars). Lease Termination Costs Severance Costs Total Professional & Industrial $ 0.9 $ 3.5 $ 4.4 Science, Engineering & Technology — 0.5 0.5 Education 0.8 0.1 0.9 International 0.4 0.7 1.1 Corporate 1.8 — 1.8 Total $ 3.9 $ 4.8 $ 8.7 A summary of the global restructuring balance sheet accrual, included in accrued payroll and related taxes and accounts payable and accrued liabilities in the consolidated balance sheet, is detailed below (in millions of dollars). Balance as of year-end 2020 $ 3.5 Reductions for cash payments related to all restructuring activities (2.0) Balance as of first quarter-end 2021 $ 1.5 The remaining balance of $1.5 million as of first quarter-end 2021 primarily represents severance costs, and the majority is expected to be paid by the end of 2021. No material adjustments are expected to be recorded. |
Goodwill
Goodwill | 3 Months Ended |
Apr. 04, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill The Company performs its annual goodwill impairment testing in the fourth quarter each year and regularly assesses whenever events or circumstances make it more likely than not that an impairment may have occurred. During the first quarter of 2020, negative market reaction to the COVID-19 crisis, including declines in our common stock price, caused our market capitalization to decline significantly compared to the fourth quarter of 2019, causing a triggering event. Therefore, we performed an interim step one quantitative test for our previous reporting units with goodwill, Americas Staffing and GTS, and determined that the estimated fair values of both reporting units no longer exceeded their carrying values. Based on the result of our interim goodwill impairment test as of the first quarter of 2020, we recorded a goodwill impairment charge of $147.7 million to write off goodwill for both reporting units. A portion of the goodwill balance was deductible for tax purposes. In performing the step one quantitative test and consistent with our prior practice, we determined the fair value of each reporting unit using the income approach, which is validated through reconciliation to observable market capitalization data. Under the income approach, estimated fair value is determined based on estimated future cash flows discounted by an estimated market participant weighted-average cost of capital, which reflects the overall level of inherent risk of the reporting unit being measured. Estimated future cash flows are based on our internal projection model and reflects management’s outlook for the reporting units. Assumptions and estimates about future cash flows and discount rates are complex and often subjective. Our analysis used significant assumptions by segment, including: expected future revenue and expense growth rates, profit margins, cost of capital, discount rate and forecasted capital expenditures and working capital. During the third quarter of 2020, the Company adopted a new operating model reflecting the Company's focus on delivering specialty talent solutions, which resulted in a change in our operating segments and reporting units. Due to the complete write-off of goodwill in the first quarter of 2020, reallocation of goodwill to the new reporting units as part of the third quarter 2020 change in segment reporting was not necessary. Subsequently, the goodwill resulting from the acquisition of Greenwood/Asher during the fourth quarter of 2020 (see Acquisitions and Disposition footnote) was allocated to the Education operating segment, which was deemed to be a reporting unit, under the new operating model. As of first quarter-end 2021, there were no changes in the carrying amount of goodwill from year-end 2020. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Apr. 04, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The changes in accumulated other comprehensive income (loss) by component, net of tax, for the first quarter 2021 and 2020 are included in the table below. Amounts in parentheses indicate debits. First Quarter 2021 2020 (In millions of dollars) Foreign currency translation adjustments: Beginning balance $ (0.8) $ (13.2) Other comprehensive income (loss) before reclassifications (13.6) (7.4) Amounts reclassified from accumulated other comprehensive income (loss) — — Net current-period other comprehensive income (loss) (13.6) (7.4) Ending balance (14.4) (20.6) Pension liability adjustments: Beginning balance (3.4) (2.6) Other comprehensive income (loss) before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) — — Net current-period other comprehensive income (loss) — — Ending balance (3.4) (2.6) Total accumulated other comprehensive income (loss) $ (17.8) $ (23.2) |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 3 Months Ended |
Apr. 04, 2021 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share The reconciliation of basic and diluted earnings (loss) per share on common stock for the first quarter 2021 and 2020 follows (in millions of dollars except per share data): First Quarter 2021 2020 Net earnings (loss) $ 25.6 $ (153.2) Less: earnings allocated to participating securities (0.2) — Net earnings (loss) available to common shareholders $ 25.4 $ (153.2) Average shares outstanding (millions): Basic 39.3 39.2 Dilutive share awards 0.2 — Diluted 39.5 39.2 Basic earnings (loss) per share $ 0.65 $ (3.91) Diluted earnings (loss) per share $ 0.64 $ (3.91) Potentially dilutive shares outstanding are primarily related to performance shares for the first quarter 2021. There were no dividends paid per share for Class A and Class B common stock for the first quarter of 2021. Dividends paid per share for Class A and Class B common stock were $0.075 for the first quarter of 2020. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Apr. 04, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation For the first quarter of 2021, the Company recognized stock compensation expense of $1.4 million, and related tax benefit of $0.1 million. For the first quarter of 2020, the Company recognized stock compensation expense of $1.2 million, and related tax expense of $0.2 million. Performance Shares During 2021, the Company granted performance share awards associated with the Company’s Class A common stock to certain senior officers. The payment of performance share awards, which will be satisfied with the issuance of shares out of treasury stock, is contingent upon the achievement of specific revenue growth and EBITDA margin performance goals ("financial measure performance share awards") over a stated period of time. The maximum number of performance shares that may be earned is 200% of the target shares originally granted. These awards have three one-year performance periods: 2021, 2022 and 2023, with the payout for each performance period based on separate financial measure goals that are set in February of each of the three performance periods. For the 2021 and 2022 performance periods, half of the shares earned in each respective performance period will vest after achievement of the respective performance goals for the year and approval of the financial results by the Compensation Committee, in early 2022 and 2023, respectively, if not forfeited by the recipient. The remaining half of the shares earned for the 2021 and 2022 performance periods will vest in early 2024, based on continuous employment. For the 2023 performance period, any shares earned will vest after achievement of the 2023 performance goals for the year and approval of the financial results by the Compensation Committee in early 2024, if not forfeited by the recipient. No dividends are paid on these performance shares. A summary of the status of all nonvested performance shares at target as of first quarter-end 2021 and changes during this period is presented as follows below (in thousands of shares except per share data). The vesting adjustment in the table below represents the 2018 financial measure performance shares and the 2018 Total Shareholder Return ("TSR") performance shares that did not vest because actual achievement was below the threshold level and resulted in no payout. Financial Measure TSR Shares Weighted Average Grant Date Fair Value Shares Weighted Average Grant Date Fair Value Nonvested at year-end 2020 366 $ 22.40 47 $ 31.38 Granted 180 20.20 — — Vested (12) 25.10 — — Forfeited (11) 24.30 — — Vesting adjustment (93) 16.99 (47) 31.38 Nonvested at first quarter-end 2021 430 $ 23.69 — $ — Restricted Stock A summary of the status of nonvested restricted stock as of first quarter-end 2021 and changes during this period is presented as follows below (in thousands of shares except per share data). Shares Weighted Average Grant Date Fair Value Nonvested at year-end 2020 281 $ 22.74 Granted 195 21.05 Vested (83) 23.36 Forfeited (10) 24.45 Nonvested at first quarter-end 2021 383 $ 21.70 |
Sale of Assets
Sale of Assets | 3 Months Ended |
Apr. 04, 2021 | |
Sale of Assets [Abstract] | |
Sale of Assets | Sale of AssetsOn March 20, 2020, the Company sold three of our four headquarters properties for a purchase price of $58.5 million as a part of a sale and leaseback transaction. The properties included the parcels of land, together with all rights and easements, in addition to all improvements located on the land, including buildings. The Company received cash proceeds of $55.5 million, which was net of transaction expenses. As of the date of the sale, the properties had a combined net carrying amount of $23.4 million. The resulting gain on the sale of the assets was $32.1 million which is recorded in gain on sale of assets in the consolidated statements of earnings. The Company leased back the headquarters buildings on the same date. |
Other Income (Expense), Net
Other Income (Expense), Net | 3 Months Ended |
Apr. 04, 2021 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense), Net | Other Income (Expense), Net Included in other income (expense), net for the first quarter 2021 and 2020 are the following: First Quarter 2021 2020 (In millions of dollars) Interest income $ 0.1 $ 0.3 Interest expense (0.6) (0.9) Foreign exchange gains (losses) (0.2) 2.4 Other (2.7) (0.1) Other income (expense), net $ (3.4) $ 1.7 |
Income Taxes
Income Taxes | 3 Months Ended |
Apr. 04, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income tax expense was $10.5 million for the first quarter of 2021 and income tax benefit was $36.2 million for the first quarter of 2020. The first quarter of 2021 includes tax expense of $9.2 million for the gain on the Company's investment in Persol Holdings. The first quarter of 2020 includes a tax benefit of $23.0 million on the impairment of goodwill and a tax benefit of $23.8 million for the loss on the Company's investment in Persol Holdings. The first quarter of 2020 benefit was partially offset by losses on tax exempt investments in life insurance policies and income from the sale of assets discussed in the Sale of Assets footnote. Our tax expense is affected by recurring items, such as the amount of pretax income and its mix by jurisdiction, U.S. work opportunity credits and the change in cash surrender value of tax exempt investments in life insurance policies. It is also affected by discrete items that may occur in any given period but are not consistent from period to period, such as tax law changes, changes in judgment regarding the realizability of deferred tax assets, the tax effects of stock compensation, and changes in the fair value of the Company’s investment in Persol Holdings, which are treated as discrete since they cannot be estimated. The first quarter of 2020 impairment of goodwill was treated as discrete. The Company provides valuation allowances against deferred tax assets when it is more likely than not that some portion or all of the deferred tax asset will not be realized. At this time, we have no valuation allowance against our Mexican deferred tax asset of $4.2 million, though it is possible this may change as we assess the impacts of the new labor laws enacted in the second quarter of 2021 on our Mexican business operations. |
Segment Disclosures
Segment Disclosures | 3 Months Ended |
Apr. 04, 2021 | |
Segment Reporting [Abstract] | |
Segment Disclosures | Segment Disclosures The Company’s operating segments, which also represent its reporting segments, are based on the organizational structure for which financial results are regularly evaluated by the Company’s chief operating decision-maker ("CODM", the Company’s CEO) to determine resource allocation and assess performance. The Company’s five reportable segments, (1) Professional & Industrial, (2) Science, Engineering & Technology, (3) Education, (4) Outsourcing & Consulting, and (5) International, reflect the specialty services the Company provides to customers and represent how the business is organized internally. Intersegment revenue represents revenue earned between the reportable segments and is eliminated from total segment revenue from services. Consistent with the information provided to and evaluated by the CODM, the goodwill impairment charge in the first quarter of 2020 was included in Corporate expenses. The following tables present information about the reported revenue from services and gross profit of the Company by segment, along with a reconciliation to earnings (loss) before taxes and equity in net earnings (loss) of affiliate, for the first quarter 2021 and 2020. The Company changed its reportable segments during the third quarter of 2020. As a result, certain reclassifications have been made to the reportable segment results for the first quarter of 2020 to conform to the updated reportable segment presentation. Asset information by reportable segment is not presented, since the Company does not produce such information internally nor does it use such data to manage its business. First Quarter 2021 2020 (In millions of dollars) Revenue from Services: Professional & Industrial $ 467.6 $ 493.8 Science, Engineering & Technology 254.7 270.2 Education 111.6 142.5 Outsourcing & Consulting 99.3 89.5 International 272.9 265.2 Less: Intersegment revenue (0.2) (0.1) Consolidated Total $ 1,205.9 $ 1,261.1 First Quarter 2021 2020 (In millions of dollars) Earnings (loss) from Operations: Professional & Industrial gross profit $ 75.9 $ 85.1 Professional & Industrial SG&A expenses (69.4) (80.5) Professional & Industrial earnings (loss) from operations 6.5 4.6 Science, Engineering & Technology gross profit 53.2 54.7 Science, Engineering & Technology SG&A expenses (35.7) (36.5) Science, Engineering & Technology earnings (loss) from operations 17.5 18.2 Education gross profit 17.2 20.4 Education SG&A expenses (14.2) (16.6) Education earnings (loss) from operations 3.0 3.8 Outsourcing & Consulting gross profit 31.3 28.8 Outsourcing & Consulting SG&A expenses (28.4) (28.6) Outsourcing & Consulting earnings (loss) from operations 2.9 0.2 International gross profit 35.7 34.3 International SG&A expenses (33.1) (33.2) International earnings (loss) from operations 2.6 1.1 Corporate (21.9) (139.7) Consolidated Total 10.6 (111.8) Gain (loss) on investment in Persol Holdings 30.0 (77.8) Other income (expense), net (3.4) 1.7 Earnings (loss) before taxes and equity in net earnings (loss) of affiliate $ 37.2 $ (187.9) |
Subsequent Event
Subsequent Event | 3 Months Ended |
Apr. 04, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent EventOn April 5, 2021, the Company acquired 100% of the shares of Softworld, Inc. ("Softworld") for $215.0 million of cash, subject to working capital adjustments. Softworld is a leading technology staffing and workforce solutions firm that serves clients across several end-markets, including financial services, life sciences, aerospace, defense, insurance, retail and IT consulting. The related acquisition costs, which are included in other income (expense), net in the consolidated statements of earnings, were $1.3 million. The initial accounting for the business combination is incomplete at the time of this filing due to the limited amount of time since the acquisition date and the ongoing status of the valuation. Therefore, it is impracticable for the Company to provide the major classes of assets acquired and liabilities assumed or pro forma revenue and earnings. |
New Accounting Pronouncements (
New Accounting Pronouncements (Policies) | 3 Months Ended |
Apr. 04, 2021 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Recently Adopted In January 2020, the FASB issued ASU 2020-01 which clarifies the interaction of rules for equity securities, the equity method of accounting, and forward contracts and purchase options on certain types of securities. The guidance clarifies how to account for the transition into and out of the equity method of accounting when considering observable transactions under the measurement alternative. The ASU is effective for annual reporting periods beginning after December 15, 2020, including interim reporting periods within those annual periods, with early adoption permitted. The adoption of this standard did not have a material impact to our consolidated financial statements. In December 2019, the FASB issued ASU 2019-12 simplifying various aspects related to the accounting for income taxes. The guidance removes exceptions to the general principles in Topic 740 related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The ASU is effective for annual reporting periods beginning after December 15, 2020, including interim reporting periods within those annual periods, with early adoption permitted. The adoption of this standard did not have a material impact to our consolidated financial statements. Management has evaluated other recently issued accounting pronouncements and does not believe that any of these pronouncements will have a significant impact on our consolidated financial statements and related disclosures. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Apr. 04, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table presents our segment revenues disaggregated by service type (in millions): First Quarter 2021 2020 Professional & Industrial Staffing services $ 352.5 $ 388.4 Permanent placement 4.9 3.0 Outcome-based services 110.2 102.4 Total Professional & Industrial 467.6 493.8 Science, Engineering & Technology Staffing services 186.2 199.2 Permanent placement 4.8 3.4 Outcome-based services 63.7 67.6 Total Science, Engineering & Technology 254.7 270.2 Education Staffing services 110.8 142.4 Permanent placement 0.8 0.1 Total Education 111.6 142.5 Outsourcing & Consulting Talent solutions 99.3 89.5 Total Outsourcing & Consulting 99.3 89.5 International Staffing services 265.6 259.5 Permanent placement 5.5 5.7 Talent solutions 1.8 — Total International 272.9 265.2 Total Intersegment (0.2) (0.1) Total Revenue from Services $ 1,205.9 $ 1,261.1 The below table presents our revenues disaggregated by geography (in millions): First Quarter 2021 2020 Americas United States $ 858.5 $ 928.5 Mexico 34.6 28.7 Canada 34.1 32.8 Puerto Rico 24.2 17.7 Brazil — 9.1 Total Americas Region 951.4 1,016.8 Europe France 54.3 52.5 Switzerland 52.7 44.2 Portugal 43.7 43.6 Russia 32.6 32.1 Italy 18.1 14.7 United Kingdom 17.0 22.3 Germany 7.1 8.0 Ireland 5.1 5.0 Other 15.6 15.2 Total Europe Region 246.2 237.6 Total Asia-Pacific Region 8.3 6.7 Total Kelly Services, Inc. $ 1,205.9 $ 1,261.1 The below table presents our SET, OCG and International segment revenues disaggregated by geographic region (in millions): First Quarter 2021 2020 Science, Engineering & Technology Americas $ 253.2 $ 268.4 Europe 1.5 1.8 Total Science, Engineering & Technology $ 254.7 $ 270.2 Outsourcing & Consulting Americas $ 84.8 $ 74.6 Europe 6.2 8.2 Asia-Pacific 8.3 6.7 Total Outsourcing & Consulting $ 99.3 $ 89.5 International Americas $ 34.3 $ 37.6 Europe 238.6 227.6 Total International $ 272.9 $ 265.2 |
Credit Losses (Tables)
Credit Losses (Tables) | 3 Months Ended |
Apr. 04, 2021 | |
Credit Loss [Abstract] | |
Accounts Receivable, Allowance for Credit Loss | The rollforward of our allowance for credit losses related to trade accounts receivable, which is recorded in trade accounts receivable, less allowance in the consolidated balance sheet, is as follows (in millions): First Quarter 2021 2020 Allowance for credit losses: Beginning balance $ 9.8 $ 9.7 Impact of adopting ASC 326 — 0.3 Current period provision (0.2) (0.4) Currency exchange effects (0.2) (0.5) Write-offs (0.3) (0.2) Ending balance $ 9.1 $ 8.9 |
Financing Receivable, Allowance for Credit Loss | The rollforward of our allowance for credit losses related to the long-term customer receivable, which is recorded in other assets in the consolidated balance sheet, is as follows (in millions): First Quarter 2021 2020 Allowance for credit losses: Beginning balance $ 10.9 $ 1.0 Impact of adopting ASC 326 — 0.7 Current period provision — — Currency exchange effects — — Ending Balance $ 10.9 $ 1.7 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Apr. 04, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Assets Measured on Recurring Basis | As of First Quarter-End 2021 Description Total Level 1 Level 2 Level 3 (In millions of dollars) Money market funds $ 5.6 $ 5.6 $ — $ — Investment in Persol Holdings 181.7 181.7 — — Total assets at fair value $ 187.3 $ 187.3 $ — $ — Brazil indemnification $ (2.4) $ — $ — $ (2.4) Greenwood/Asher earnout (1.7) — — (1.7) Insight earnout (1.7) — — (1.7) Total liabilities at fair value $ (5.8) $ — $ — $ (5.8) As of Year-End 2020 Description Total Level 1 Level 2 Level 3 (In millions of dollars) Money market funds $ 120.3 $ 120.3 $ — $ — Investment in Persol Holdings 164.2 164.2 — — Total assets at fair value $ 284.5 $ 284.5 $ — $ — Brazil indemnification $ (2.6) $ — $ — $ (2.6) Greenwood/Asher earnout (2.1) — — (2.1) Insight earnout (1.7) — — (1.7) Total liabilities at fair value $ (6.4) $ — $ — $ (6.4) |
Restructuring (Tables)
Restructuring (Tables) | 3 Months Ended |
Apr. 04, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Restructuring costs incurred in the first quarter of 2020 totaled $8.7 million and were recorded entirely in SG&A expenses in the consolidated statements of earnings, as detailed below (in millions of dollars). Lease Termination Costs Severance Costs Total Professional & Industrial $ 0.9 $ 3.5 $ 4.4 Science, Engineering & Technology — 0.5 0.5 Education 0.8 0.1 0.9 International 0.4 0.7 1.1 Corporate 1.8 — 1.8 Total $ 3.9 $ 4.8 $ 8.7 |
Schedule of Restructuring Balance Sheet Accrual | A summary of the global restructuring balance sheet accrual, included in accrued payroll and related taxes and accounts payable and accrued liabilities in the consolidated balance sheet, is detailed below (in millions of dollars). Balance as of year-end 2020 $ 3.5 Reductions for cash payments related to all restructuring activities (2.0) Balance as of first quarter-end 2021 $ 1.5 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Apr. 04, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income by Component, Net of Tax | The changes in accumulated other comprehensive income (loss) by component, net of tax, for the first quarter 2021 and 2020 are included in the table below. Amounts in parentheses indicate debits. First Quarter 2021 2020 (In millions of dollars) Foreign currency translation adjustments: Beginning balance $ (0.8) $ (13.2) Other comprehensive income (loss) before reclassifications (13.6) (7.4) Amounts reclassified from accumulated other comprehensive income (loss) — — Net current-period other comprehensive income (loss) (13.6) (7.4) Ending balance (14.4) (20.6) Pension liability adjustments: Beginning balance (3.4) (2.6) Other comprehensive income (loss) before reclassifications — — Amounts reclassified from accumulated other comprehensive income (loss) — — Net current-period other comprehensive income (loss) — — Ending balance (3.4) (2.6) Total accumulated other comprehensive income (loss) $ (17.8) $ (23.2) |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 3 Months Ended |
Apr. 04, 2021 | |
Earnings Per Share [Abstract] | |
Reconciliation of Basic and Diluted Earnings Per Share | The reconciliation of basic and diluted earnings (loss) per share on common stock for the first quarter 2021 and 2020 follows (in millions of dollars except per share data): First Quarter 2021 2020 Net earnings (loss) $ 25.6 $ (153.2) Less: earnings allocated to participating securities (0.2) — Net earnings (loss) available to common shareholders $ 25.4 $ (153.2) Average shares outstanding (millions): Basic 39.3 39.2 Dilutive share awards 0.2 — Diluted 39.5 39.2 Basic earnings (loss) per share $ 0.65 $ (3.91) Diluted earnings (loss) per share $ 0.64 $ (3.91) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Apr. 04, 2021 | |
Performance Shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Performance Shares and Restricted Stock | A summary of the status of all nonvested performance shares at target as of first quarter-end 2021 and changes during this period is presented as follows below (in thousands of shares except per share data). The vesting adjustment in the table below represents the 2018 financial measure performance shares and the 2018 Total Shareholder Return ("TSR") performance shares that did not vest because actual achievement was below the threshold level and resulted in no payout. Financial Measure TSR Shares Weighted Average Grant Date Fair Value Shares Weighted Average Grant Date Fair Value Nonvested at year-end 2020 366 $ 22.40 47 $ 31.38 Granted 180 20.20 — — Vested (12) 25.10 — — Forfeited (11) 24.30 — — Vesting adjustment (93) 16.99 (47) 31.38 Nonvested at first quarter-end 2021 430 $ 23.69 — $ — |
Restricted Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Performance Shares and Restricted Stock | A summary of the status of nonvested restricted stock as of first quarter-end 2021 and changes during this period is presented as follows below (in thousands of shares except per share data). Shares Weighted Average Grant Date Fair Value Nonvested at year-end 2020 281 $ 22.74 Granted 195 21.05 Vested (83) 23.36 Forfeited (10) 24.45 Nonvested at first quarter-end 2021 383 $ 21.70 |
Other Income (Expense), Net (Ta
Other Income (Expense), Net (Tables) | 3 Months Ended |
Apr. 04, 2021 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Income (Expense), Net | Included in other income (expense), net for the first quarter 2021 and 2020 are the following: First Quarter 2021 2020 (In millions of dollars) Interest income $ 0.1 $ 0.3 Interest expense (0.6) (0.9) Foreign exchange gains (losses) (0.2) 2.4 Other (2.7) (0.1) Other income (expense), net $ (3.4) $ 1.7 |
Segment Disclosures (Tables)
Segment Disclosures (Tables) | 3 Months Ended |
Apr. 04, 2021 | |
Segment Reporting [Abstract] | |
Segment Revenue from Services | The following tables present information about the reported revenue from services and gross profit of the Company by segment, along with a reconciliation to earnings (loss) before taxes and equity in net earnings (loss) of affiliate, for the first quarter 2021 and 2020. The Company changed its reportable segments during the third quarter of 2020. As a result, certain reclassifications have been made to the reportable segment results for the first quarter of 2020 to conform to the updated reportable segment presentation. Asset information by reportable segment is not presented, since the Company does not produce such information internally nor does it use such data to manage its business. First Quarter 2021 2020 (In millions of dollars) Revenue from Services: Professional & Industrial $ 467.6 $ 493.8 Science, Engineering & Technology 254.7 270.2 Education 111.6 142.5 Outsourcing & Consulting 99.3 89.5 International 272.9 265.2 Less: Intersegment revenue (0.2) (0.1) Consolidated Total $ 1,205.9 $ 1,261.1 |
Segment Earnings From Operations | First Quarter 2021 2020 (In millions of dollars) Earnings (loss) from Operations: Professional & Industrial gross profit $ 75.9 $ 85.1 Professional & Industrial SG&A expenses (69.4) (80.5) Professional & Industrial earnings (loss) from operations 6.5 4.6 Science, Engineering & Technology gross profit 53.2 54.7 Science, Engineering & Technology SG&A expenses (35.7) (36.5) Science, Engineering & Technology earnings (loss) from operations 17.5 18.2 Education gross profit 17.2 20.4 Education SG&A expenses (14.2) (16.6) Education earnings (loss) from operations 3.0 3.8 Outsourcing & Consulting gross profit 31.3 28.8 Outsourcing & Consulting SG&A expenses (28.4) (28.6) Outsourcing & Consulting earnings (loss) from operations 2.9 0.2 International gross profit 35.7 34.3 International SG&A expenses (33.1) (33.2) International earnings (loss) from operations 2.6 1.1 Corporate (21.9) (139.7) Consolidated Total 10.6 (111.8) Gain (loss) on investment in Persol Holdings 30.0 (77.8) Other income (expense), net (3.4) 1.7 Earnings (loss) before taxes and equity in net earnings (loss) of affiliate $ 37.2 $ (187.9) |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenues by Service Type (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 1,205.9 | $ 1,261.1 |
Professional & Industrial | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 467.6 | 493.8 |
Science, Engineering & Technology | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 254.7 | 270.2 |
Education | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 111.6 | 142.5 |
Outsourcing & Consulting | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 99.3 | 89.5 |
International | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 272.9 | 265.2 |
Staffing Services | Professional & Industrial | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 352.5 | 388.4 |
Staffing Services | Science, Engineering & Technology | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 186.2 | 199.2 |
Staffing Services | Education | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 110.8 | 142.4 |
Staffing Services | International | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 265.6 | 259.5 |
Permanent Placement | Professional & Industrial | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 4.9 | 3 |
Permanent Placement | Science, Engineering & Technology | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 4.8 | 3.4 |
Permanent Placement | Education | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 0.8 | 0.1 |
Permanent Placement | International | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 5.5 | 5.7 |
Outcome-Based Services | Professional & Industrial | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 110.2 | 102.4 |
Outcome-Based Services | Science, Engineering & Technology | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 63.7 | 67.6 |
Talent Solutions | Outsourcing & Consulting | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 99.3 | 89.5 |
Talent Solutions | International | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1.8 | 0 |
Less: Intersegment | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ (0.2) | $ (0.1) |
Revenue - Revenue by Country (D
Revenue - Revenue by Country (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 1,205.9 | $ 1,261.1 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 858.5 | 928.5 |
Mexico | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 34.6 | 28.7 |
Canada | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 34.1 | 32.8 |
Puerto Rico | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 24.2 | 17.7 |
Brazil | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 0 | 9.1 |
Total Americas Region | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 951.4 | 1,016.8 |
France | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 54.3 | 52.5 |
Switzerland | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 52.7 | 44.2 |
Portugal | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 43.7 | 43.6 |
Russia | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 32.6 | 32.1 |
Italy | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 18.1 | 14.7 |
United Kingdom | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 17 | 22.3 |
Germany | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 7.1 | 8 |
Ireland | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 5.1 | 5 |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 15.6 | 15.2 |
Total Europe Region | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 246.2 | 237.6 |
Total Asia-Pacific Region | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 8.3 | $ 6.7 |
Revenue - Disaggregation of R_2
Revenue - Disaggregation of Revenues by Geographic Region (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 1,205.9 | $ 1,261.1 |
Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 951.4 | 1,016.8 |
Asia-Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 8.3 | 6.7 |
Science, Engineering & Technology | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 254.7 | 270.2 |
Science, Engineering & Technology | Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 253.2 | 268.4 |
Science, Engineering & Technology | Europe | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1.5 | 1.8 |
Outsourcing & Consulting | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 99.3 | 89.5 |
Outsourcing & Consulting | Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 84.8 | 74.6 |
Outsourcing & Consulting | Europe | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 6.2 | 8.2 |
Outsourcing & Consulting | Asia-Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 8.3 | 6.7 |
International | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 272.9 | 265.2 |
International | Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 34.3 | 37.6 |
International | Europe | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 238.6 | $ 227.6 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 04, 2021 | Mar. 29, 2020 | Jan. 03, 2021 | |
Deferred Sales Commissions | |||
Revenue from Contract with Customer [Line Items] | |||
Capitalized contract cost | $ 1 | $ 1 | |
Capitalized contract cost, amortization | 0.2 | $ 0.3 | |
Deferred Fulfillment Costs | |||
Revenue from Contract with Customer [Line Items] | |||
Capitalized contract cost | 2.4 | $ 4.1 | |
Capitalized contract cost, amortization | $ 6.8 | $ 4.8 |
Credit Losses - Narrative (Deta
Credit Losses - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||||
Apr. 04, 2021 | Jan. 03, 2021 | Sep. 27, 2020 | Mar. 29, 2020 | Dec. 29, 2019 | |
Financing Receivable, Allowance for Credit Loss [Line Items] | |||||
Loss contingency, damages sought, value | $ 10 | ||||
Financing Receivable, Allowance for Credit Loss | $ 10.9 | $ 10.9 | $ 1.7 | $ 1 | |
Other Assets | |||||
Financing Receivable, Allowance for Credit Loss [Line Items] | |||||
Financing Receivable, Allowance for Credit Loss | $ 9.2 |
Credit Losses - Allowance for C
Credit Losses - Allowance for Credit Losses Related to Trade Accounts Receivable (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Allowance for credit losses: | ||
Beginning balance | $ 9.8 | $ 9.7 |
Impact of adopting ASC 326 | 0 | 0.3 |
Current period provision | (0.2) | (0.4) |
Currency exchange effects | (0.2) | (0.5) |
Write-offs | (0.3) | (0.2) |
Ending balance | $ 9.1 | $ 8.9 |
Credit Losses - Allowance for_2
Credit Losses - Allowance for Credit Losses Related to the Long-Term Customer Receivable (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Allowance for credit losses: | ||
Beginning balance | $ 10.9 | $ 1 |
Impact of adopting ASC 326 | 0 | 0.7 |
Current period provision | 0 | 0 |
Currency exchange effects | 0 | 0 |
Ending balance | $ 10.9 | $ 1.7 |
Acquisitions and Disposition -
Acquisitions and Disposition - Acquisitions Narrative (Details) - USD ($) $ in Millions | Nov. 18, 2020 | Jan. 14, 2020 | Apr. 04, 2021 | Jun. 28, 2020 | Jan. 03, 2021 |
Greenwood/Asher | |||||
Business Acquisition [Line Items] | |||||
Ownership percentage acquired | 100.00% | ||||
Purchase price of acquisition | $ 3.5 | ||||
Purchase price paid at closing | 5.2 | ||||
Contingent consideration, liability | $ 2.1 | ||||
Business acquisition, goodwill, expected tax deductible amount | $ 0.9 | ||||
Adjustment to earnout liability | (0.4) | ||||
Insight | |||||
Business Acquisition [Line Items] | |||||
Ownership percentage acquired | 100.00% | ||||
Purchase price of acquisition | $ 34.5 | ||||
Purchase price paid at closing | 38.1 | ||||
Contingent consideration, liability | $ 1.6 | ||||
Business acquisition, goodwill, expected tax deductible amount | $ 18.6 | ||||
Adjustment to earnout liability | $ 0.1 | ||||
Payments for previous acquisition | $ 0.1 |
Acquisitions and Disposition _2
Acquisitions and Disposition - Disposition Narrative (Details) - Brazil $ in Millions | Aug. 18, 2020USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Purchase price of disposition | $ 1.4 |
Proceeds from sale of Brazil, net of cash disposed | 1.2 |
Indemnification liabilities, range of outcomes, value, high | 8.8 |
Indemnification liability | $ 2.5 |
Investment in Persol Holdings -
Investment in Persol Holdings - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Investment in Persol Holdings [Abstract] | ||
Gain (loss) on investment in Persol Holdings | $ 30 | $ (77.8) |
Investment in PersolKelly Pte_2
Investment in PersolKelly Pte Ltd. (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Apr. 04, 2021 | Mar. 29, 2020 | Jan. 03, 2021 | |
Schedule of Equity Method Investments [Line Items] | |||
Equity in net earnings (loss) of affiliate | $ (1.1) | $ (1.5) | |
Investment in equity affiliate | $ 118.7 | $ 118.5 | |
PersolKelly Pte. Ltd. | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investment, ownership percentage | 49.00% | ||
Due from PersolKelly Pte. Ltd. | $ 5.2 | $ 5.6 | |
Notes receivable, related parties, current | $ 5.8 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions | Apr. 04, 2021 | Jan. 03, 2021 |
Assets, Fair Value Disclosure [Abstract] | ||
Investment in Persol Holdings | $ 181.7 | $ 164.2 |
Measured on Recurring Basis | ||
Assets, Fair Value Disclosure [Abstract] | ||
Money market funds | 5.6 | 120.3 |
Investment in Persol Holdings | 181.7 | 164.2 |
Total assets at fair value | 187.3 | 284.5 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Brazil indemnification | (2.4) | (2.6) |
Total liabilities at fair value | (5.8) | (6.4) |
Measured on Recurring Basis | Greenwood/Asher | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Earnout, fair value | (1.7) | (2.1) |
Measured on Recurring Basis | Insight | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Earnout, fair value | (1.7) | (1.7) |
Measured on Recurring Basis | Level 1 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Money market funds | 5.6 | 120.3 |
Investment in Persol Holdings | 181.7 | 164.2 |
Total assets at fair value | 187.3 | 284.5 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Brazil indemnification | 0 | 0 |
Total liabilities at fair value | 0 | 0 |
Measured on Recurring Basis | Level 1 | Greenwood/Asher | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Earnout, fair value | 0 | 0 |
Measured on Recurring Basis | Level 1 | Insight | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Earnout, fair value | 0 | 0 |
Measured on Recurring Basis | Level 2 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Money market funds | 0 | 0 |
Investment in Persol Holdings | 0 | 0 |
Total assets at fair value | 0 | 0 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Brazil indemnification | 0 | 0 |
Total liabilities at fair value | 0 | 0 |
Measured on Recurring Basis | Level 2 | Greenwood/Asher | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Earnout, fair value | 0 | 0 |
Measured on Recurring Basis | Level 2 | Insight | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Earnout, fair value | 0 | 0 |
Measured on Recurring Basis | Level 3 | ||
Assets, Fair Value Disclosure [Abstract] | ||
Money market funds | 0 | 0 |
Investment in Persol Holdings | 0 | 0 |
Total assets at fair value | 0 | 0 |
Liabilities, Fair Value Disclosure [Abstract] | ||
Brazil indemnification | (2.4) | (2.6) |
Total liabilities at fair value | (5.8) | (6.4) |
Measured on Recurring Basis | Level 3 | Greenwood/Asher | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Earnout, fair value | (1.7) | (2.1) |
Measured on Recurring Basis | Level 3 | Insight | ||
Liabilities, Fair Value Disclosure [Abstract] | ||
Earnout, fair value | $ (1.7) | $ (1.7) |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Apr. 04, 2021 | Mar. 29, 2020 | Jan. 03, 2021 | Mar. 08, 2021 | Nov. 18, 2020 | Jan. 14, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Indemnification liabilities, expense (income) | $ (0.2) | |||||
Goodwill impairment charge | 0 | $ 147.7 | ||||
Insight | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Contingent consideration, liability | $ 1.6 | |||||
Adjustment to earnout liability | $ 0.1 | |||||
Greenwood/Asher | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Contingent consideration, liability | $ 2.1 | |||||
Adjustment to earnout liability | (0.4) | |||||
Persol Holdings Investment | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Cost of equity securities | 18.7 | 20.1 | ||||
Business Talent Group, LLC | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Equity securities without readily determinable fair value, amount | 5 | 5 | ||||
Kenzie Academy Inc. | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Equity securities without readily determinable fair value, with changes in fair value in net income | 1.4 | $ 1.4 | ||||
Debt and Equity Securities, Realized Gain (Loss) | (1.4) | |||||
Other Assets | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Money market funds | 5.6 | 5.1 | ||||
Level 3 | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Indemnification liability | 2.4 | 2.6 | ||||
Level 3 | Insight | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Contingent consideration, liability | 1.7 | 1.7 | ||||
Level 3 | Greenwood/Asher | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Contingent consideration, liability | $ 1.7 | $ 2.1 |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 29, 2020 | Apr. 04, 2021 | Jan. 03, 2021 | |
Restructuring and Related Activities [Abstract] | |||
Restructuring costs | $ 8.7 | ||
Restructuring accrual | $ 1.5 | $ 3.5 |
Restructuring - Schedule of Res
Restructuring - Schedule of Restructuring and Related Costs (Details) $ in Millions | 3 Months Ended |
Mar. 29, 2020USD ($) | |
Restructuring Cost and Reserve [Line Items] | |
Lease Termination Costs | $ 3.9 |
Severance Costs | 4.8 |
Total | 8.7 |
Professional & Industrial | |
Restructuring Cost and Reserve [Line Items] | |
Lease Termination Costs | 0.9 |
Severance Costs | 3.5 |
Total | 4.4 |
Science, Engineering & Technology | |
Restructuring Cost and Reserve [Line Items] | |
Lease Termination Costs | 0 |
Severance Costs | 0.5 |
Total | 0.5 |
Education | |
Restructuring Cost and Reserve [Line Items] | |
Lease Termination Costs | 0.8 |
Severance Costs | 0.1 |
Total | 0.9 |
International | |
Restructuring Cost and Reserve [Line Items] | |
Lease Termination Costs | 0.4 |
Severance Costs | 0.7 |
Total | 1.1 |
Corporate | |
Restructuring Cost and Reserve [Line Items] | |
Lease Termination Costs | 1.8 |
Severance Costs | 0 |
Total | $ 1.8 |
Restructuring - Restructuring R
Restructuring - Restructuring Reserve (Details) $ in Millions | 3 Months Ended |
Apr. 04, 2021USD ($) | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | $ 3.5 |
Reductions for cash payments related to all restructuring activities | (2) |
Ending balance | $ 1.5 |
Goodwill - Narrative (Details)
Goodwill - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill impairment charge | $ 0 | $ 147.7 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Schedule of Accumulated Other Comprehensive Income (Loss) by Component, Net of Tax (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Stockholders' Equity Attributable to Parent, Beginning Balance | $ 1,203 | |
Other comprehensive income (loss) | (13.6) | $ (7.4) |
Stockholders' Equity Attributable to Parent, Ending Balance | 1,215.7 | 1,100.1 |
Foreign currency translation adjustments: | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Stockholders' Equity Attributable to Parent, Beginning Balance | (0.8) | (13.2) |
Other comprehensive income (loss) before reclassifications | (13.6) | (7.4) |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 |
Other comprehensive income (loss) | (13.6) | (7.4) |
Stockholders' Equity Attributable to Parent, Ending Balance | (14.4) | (20.6) |
Pension liability adjustments: | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Stockholders' Equity Attributable to Parent, Beginning Balance | (3.4) | (2.6) |
Other comprehensive income (loss) before reclassifications | 0 | 0 |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 |
Other comprehensive income (loss) | 0 | 0 |
Stockholders' Equity Attributable to Parent, Ending Balance | (3.4) | (2.6) |
Accumulated Other Comprehensive Income (Loss) | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Stockholders' Equity Attributable to Parent, Beginning Balance | (4.2) | (15.8) |
Other comprehensive income (loss) | (13.6) | (7.4) |
Stockholders' Equity Attributable to Parent, Ending Balance | $ (17.8) | $ (23.2) |
Earnings (Loss) Per Share - Rec
Earnings (Loss) Per Share - Reconciliation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Earnings Per Share [Abstract] | ||
Net earnings (loss) | $ 25.6 | $ (153.2) |
Less: earnings allocated to participating securities | (0.2) | 0 |
Net earnings (loss) available to common shareholders | $ 25.4 | $ (153.2) |
Average shares outstanding (millions): | ||
Basic (in shares) | 39.3 | 39.2 |
Dilutive share awards (in shares) | 0.2 | 0 |
Diluted (in shares) | 39.5 | 39.2 |
Basic earnings (loss) per share on common stock (in dollars per share) | $ 0.65 | $ (3.91) |
Diluted earnings (loss) per share on common stock (in dollars per share) | $ 0.64 | $ (3.91) |
Earnings (Loss) Per Share - Nar
Earnings (Loss) Per Share - Narrative (Details) - $ / shares | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Class A Common Stock | ||
Dividends Payable [Line Items] | ||
Dividends per share (in dollars per share) | $ 0 | $ 0.075 |
Class B Common Stock | ||
Dividends Payable [Line Items] | ||
Dividends per share (in dollars per share) | $ 0 | $ 0.075 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||
Apr. 04, 2021 | Mar. 29, 2020 | Jan. 03, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense (benefit) | $ 1.4 | $ 1.2 | |
Related tax benefit (expense) | $ 0.1 | $ (0.2) | |
Financial Measure Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted average grant date fair value (in dollars per share) | $ 23.69 | $ 22.40 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Nonvested Performance Shares (Details) shares in Thousands | 3 Months Ended |
Apr. 04, 2021$ / sharesshares | |
Financial Measure Performance Shares | |
Shares | |
Nonvested, beginning balance (in shares) | shares | 366 |
Granted (in shares) | shares | 180 |
Vested (in shares) | shares | (12) |
Forfeited (in shares) | shares | (11) |
Vesting adjustment (in shares) | shares | (93) |
Nonvested, ending balance (in shares) | shares | 430 |
Weighted Average Grant Date Fair Value | |
Nonvested, beginning balance (in dollars per share) | $ / shares | $ 22.40 |
Granted (in dollars per share) | $ / shares | 20.20 |
Vested (in dollars per share) | $ / shares | 25.10 |
Forfeited (in dollars per share) | $ / shares | 24.30 |
Vesting adjustment (in dollars per share) | $ / shares | 16.99 |
Nonvested, ending balance (in dollars per share) | $ / shares | $ 23.69 |
TSR Performance Shares | |
Shares | |
Nonvested, beginning balance (in shares) | shares | 47 |
Granted (in shares) | shares | 0 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | 0 |
Vesting adjustment (in shares) | shares | (47) |
Nonvested, ending balance (in shares) | shares | 0 |
Weighted Average Grant Date Fair Value | |
Nonvested, beginning balance (in dollars per share) | $ / shares | $ 31.38 |
Granted (in dollars per share) | $ / shares | 0 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 0 |
Vesting adjustment (in dollars per share) | $ / shares | 31.38 |
Nonvested, ending balance (in dollars per share) | $ / shares | $ 0 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Nonvested Restricted Stock (Details) - Restricted Stock shares in Thousands | 3 Months Ended |
Apr. 04, 2021$ / sharesshares | |
Shares | |
Nonvested, beginning balance (in shares) | shares | 281 |
Granted (in shares) | shares | 195 |
Vested (in shares) | shares | (83) |
Forfeited (in shares) | shares | (10) |
Nonvested, ending balance (in shares) | shares | 383 |
Weighted Average Grant Date Fair Value | |
Nonvested, beginning balance (in dollars per share) | $ / shares | $ 22.74 |
Granted (in dollars per share) | $ / shares | 21.05 |
Vested (in dollars per share) | $ / shares | 23.36 |
Forfeited (in dollars per share) | $ / shares | 24.45 |
Nonvested, ending balance (in dollars per share) | $ / shares | $ 21.70 |
Sale of Assets - Narrative (Det
Sale of Assets - Narrative (Details) $ in Millions | Mar. 20, 2020USD ($)headquarters |
Sale of Assets [Abstract] | |
Number of headquarters properties sold | headquarters | 3 |
Number of headquarters properties | headquarters | 4 |
Sale leaseback transaction, gross proceeds | $ 58.5 |
Sale leaseback transaction, net proceeds | 55.5 |
Properties held-for-sale | 23.4 |
Gain on sale on properties | $ 32.1 |
Other Income (Expense), Net - S
Other Income (Expense), Net - Schedule of Other Nonoperating Income (Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Other Income and Expenses [Abstract] | ||
Interest income | $ 0.1 | $ 0.3 |
Interest expense | (0.6) | (0.9) |
Foreign exchange gains (losses) | (0.2) | 2.4 |
Other expense | (2.7) | (0.1) |
Other income (expense), net | $ (3.4) | $ 1.7 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Income Taxes [Line Items] | ||
Income tax expense (benefit) | $ 10.5 | $ (36.2) |
Mexico | ||
Income Taxes [Line Items] | ||
Deferred tax asset | 4.2 | |
Persol Holdings | ||
Income Taxes [Line Items] | ||
Income tax expense (benefit) | $ 9.2 | (23.8) |
Goodwill | ||
Income Taxes [Line Items] | ||
Income tax expense (benefit) | $ (23) |
Contingencies - Narrative (Deta
Contingencies - Narrative (Details) - USD ($) $ in Millions | Apr. 04, 2021 | Jan. 03, 2021 |
Loss Contingencies [Line Items] | ||
Accrual for litigation costs | $ 1.2 | $ 1.4 |
Minimum | ||
Loss Contingencies [Line Items] | ||
Loss contingency, portion not accrued | 0.1 | |
Maximum | ||
Loss Contingencies [Line Items] | ||
Loss contingency, portion not accrued | $ 1.8 |
Segment Disclosures - Narrative
Segment Disclosures - Narrative (Details) | 3 Months Ended |
Apr. 04, 2021segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 5 |
Segment Disclosures - Segment R
Segment Disclosures - Segment Revenue From Service (Details) - Service - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Revenue from Services | ||
Segment revenue from services | $ 1,205.9 | $ 1,261.1 |
Less: Intersegment revenue | ||
Revenue from Services | ||
Segment revenue from services | (0.2) | (0.1) |
Professional & Industrial | Reporting Segments | ||
Revenue from Services | ||
Segment revenue from services | 467.6 | 493.8 |
Science, Engineering & Technology | Reporting Segments | ||
Revenue from Services | ||
Segment revenue from services | 254.7 | 270.2 |
Education | Reporting Segments | ||
Revenue from Services | ||
Segment revenue from services | 111.6 | 142.5 |
Outsourcing & Consulting | Reporting Segments | ||
Revenue from Services | ||
Segment revenue from services | 99.3 | 89.5 |
International | Reporting Segments | ||
Revenue from Services | ||
Segment revenue from services | $ 272.9 | $ 265.2 |
Segment Disclosures - Segment E
Segment Disclosures - Segment Earnings (loss) From Operations (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 04, 2021 | Mar. 29, 2020 | |
Earnings (loss) from Operations | ||
Gross profit | $ 213.3 | $ 223.3 |
SG&A expenses | (202.7) | (219.5) |
Earnings (loss) from operations | 10.6 | (111.8) |
Gain (loss) on investment in Persol Holdings | 30 | (77.8) |
Other income (expense), net | (3.4) | 1.7 |
Earnings (loss) before taxes and equity in net earnings (loss) of affiliate | 37.2 | (187.9) |
Corporate | ||
Earnings (loss) from Operations | ||
Earnings (loss) from operations | (21.9) | (139.7) |
Professional & Industrial | Reporting Segments | ||
Earnings (loss) from Operations | ||
Gross profit | 75.9 | 85.1 |
SG&A expenses | (69.4) | (80.5) |
Earnings (loss) from operations | 6.5 | 4.6 |
Science, Engineering & Technology | Reporting Segments | ||
Earnings (loss) from Operations | ||
Gross profit | 53.2 | 54.7 |
SG&A expenses | (35.7) | (36.5) |
Earnings (loss) from operations | 17.5 | 18.2 |
Education | Reporting Segments | ||
Earnings (loss) from Operations | ||
Gross profit | 17.2 | 20.4 |
SG&A expenses | (14.2) | (16.6) |
Earnings (loss) from operations | 3 | 3.8 |
Outsourcing & Consulting | Reporting Segments | ||
Earnings (loss) from Operations | ||
Gross profit | 31.3 | 28.8 |
SG&A expenses | (28.4) | (28.6) |
Earnings (loss) from operations | 2.9 | 0.2 |
International | Reporting Segments | ||
Earnings (loss) from Operations | ||
Gross profit | 35.7 | 34.3 |
SG&A expenses | (33.1) | (33.2) |
Earnings (loss) from operations | $ 2.6 | $ 1.1 |
Subsequent Event (Details)
Subsequent Event (Details) - Softworld Inc. - Subsequent Event $ in Millions | Apr. 05, 2021USD ($) |
Subsequent Event [Line Items] | |
Ownership percentage acquired | 100.00% |
Purchase price of acquisition | $ 215 |
Business acquisition, transaction costs | $ 1.3 |
Uncategorized Items - kelya-202
Label | Element | Value |
Accounting Standards Update [Extensible List] | us-gaap_AccountingStandardsUpdateExtensibleList | us-gaap:AccountingStandardsUpdate201613Member |