MAN - Earnings call transcript Q2 2022

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Operator

Welcome to ManpowerGroup Second Quarter Earnings Results Conference Call. At this time, all participants are in a listen-only mode until the Q&A session of today's conference. This call will be recorded.

If you have any objections, please disconnect at this time. And now, I will turn the call over to ManpowerGroup Chairman and CEO, Jonas Prising. begin. may you Sir,

Jonas Prising

welcome second And for conference XXXX. to you. quarter the call Thank

Officer, with McGinnis, Chief Jack Our Financial is me today.

For prepared remarks then Jack Jack of have of some through will the included our Investor through go the by we manpowergroup.com. section quarter, And I XXXX. of start the quarter at our your Relations website third of some will going start will highlights Safe within convenience, the the quarter I second cover we then now results concluding share Harbor the Q&A before and session. guidance for thoughts will language. our

Jack McGinnis

forward-looking and everyone. This These statements risks based morning, and projected including COVID-XX differ and on forward-looking statements, are statements. cause pandemic made information or those or expectations from management’s call of no results statements. forward-looking reconciliation might statements statements factors known regarding the obligation in in of assume results differ Russia-Ukraine Good are beliefs. materially presentation to unknown identifies actual call regarding non-GAAP update impact materially release may that which Actual of conference uncertainties. the X earnings Slide War, and current measures. includes to We to subject further the forward-looking our this any and revise our

Jonas Prising

and Meeting technology Jack. Davos, largest VivaTech, the extensive my business touch Paris, from during back included as one events these trips Annual the later well and in in events from Economic insights I’m last week Versailles, France. world’s the Forum’s France on call. I in will just the which just Choose Summit Thanks held clients through reviews in Europe, World which of is start-up as

constant X% was second financial results, currency. X% year-over-year organic our in billion, up to the quarter constant currency, or in Turning revenue in $X.X

and reported the basis. and EBITDA was Adjusted in struck adjusted costs, clients, the for our despite policy year-over-year X.X%, increased the growth the year-over-year. margin economy, XX% quarter constant on currency travels, weighing Reported the the acquisition strong. $X.XX million, share Adjusting I'm constant for $XXX per was fact markets X.X%. global was million. basis recent XX% remain was Earnings on EBITDA adjusted on U.S. was and EBIDTA diluted $XXX a EBITDA an share reflecting clouds teams that outlook of margin currency. Our integration of earnings across meetings my After by per markets with makers in the labor on $X.XX

lesser supply be, construction continue shortages Although automotive, there from talent in our clients in disruptions continue prioritize to been, and to have degree and a chain as environment. to logistics, sectors such specific this acquiring

of As services remains major a across many result, for our our strong demand markets.

within Solutions interested and Talent our Our resourcing Solutions, MSP recruitment, clients as and permanent solutions, are in Talent RPO businesses, both particularly IT in our business as in staffing our Experis in across well in Specializations. Manpower

spill that, solutions not summary, In are most quarterly, be the XX in ManpowerGroup healthy, organizations and talent across labor at absolute the and research hiring own markets likely predicted - very markets the is strong. what degree in and our XX,XXX XX globally have that driving uncertain we to energy shortages recent Survey has able war leadership to in continued for in employers into rates hiring are remains companies have which than may Should Having market of in highest experienced diversified greater headwinds far. be manage experiencing and countries in forward-looking create so measures, environment mix outlook. combination for to that showed and the position as continued survey, record find demand changes labor case chain in highs. company our would Employment prices XX% food Our quickly, need, they we higher the Outlook the business years. increasing confidence strong adapting supply in past, services completed eventually May, and leveraging ability, economic our seen with inflation shortages also that more will talent issues we our In they remained continued confident creates Ukraine, of a plus This a economic are the the talent our to high said success.

create global value should platforms through We I to and initiatives. the well, have to business it advantage. specialized business on competitive into diversifying Experis our talent turn MyPath our even in over scale now This Academy position digitizing our through and us at services to our and more results. and will strength environment, higher Jack made you turbulent progress creating a solutions, in common take

Jack McGinnis

the Revenues guidance constant Gross in above range. Jonas. end quarter in our came Thanks, low of range. at second came the guidance margin our profit currency in

an EBITDA increase XX% representing was increase basis. currency organic million, year As prior $XXX the constant an adjusted, on a currency XX% in or constant period, from

U.S. growth Manpower days, was the more currency constant particularly points compared X.X% EBITDA drove The a billing adjusted, in impact brand. of currency guidance, dollar in basis exchange or results. X%. percent acquisitions the X.X% margin three negative much organic guidance foreign our modest euro, usual related than the the was movements more trend reported our of of net and increasing the was revenue our the our came XX almost swing high to revenue XX against of about increase X%. revenue the foreign This XX% Due bigger adjusting the to revenue strengthening revenue After had impact impact and anticipated between slightly of an growth the for about on trend dollar, to year-over-year than improvement, the significant As year-over-year organically. constant increased basis days-adjusted the at rate. result end Due representing of rates, points currency and of softer

costs. earnings integration Turning to related reported Experis $X.XX per share included the $X.XX EPS bridge, U.S. was the to acquisition which

currency positive negative of than weighted average share a $X.XX, the $X.XX. impact adjusted positive had our had to results improved due was costs, a EPS impact $X.XX, our integration operational our lower Walking mid-point, which repurchases which and in guidance Excluding particularly other more a had foreign slightly from impact rate tax shares guidance the due a quarter quarter, the performance of $X.XX during $X.XX negative weakness $X.XX effective impact. and better euro anticipated in expenses was the to slightly included

revenue brand reported Next, brand let’s on continue in the revenue growth the Within basis, line. Solutions strong the revenue revenue reported business XX%, very of and currency growth exceptional in reported X%, and RPO Manpower Talent Year-over-year, XX%. Talent growth review organic we of our revenue to Solutions by Experis an growth of revenue constant growth MSP. brand see

As activity, experience decreases saw double Right environment digit low to the outplacement continues revenue levels percentage year-over-year. of Management

transition represented XX GP contributed in markets. points. a by basis margin lower margin margin career resulted point was other Underlying margin reduction a be largest point items gross margin Management a the a Permanent at Looking basis contributed detail, of contributed driven at Experis U.S. continued acquisition our XX GP staffing across came added a XX our was which recruitment as mix basis points. points improvement which Right Solutions XX This of XX our in U.S. offset basis business XX.X%. and strong positive Experis profit in business. by XX The basis to point gross improvement increase. activity basis hiring

line. our Moving by profit business gross onto

our professional comprised the comprised Talent and quarter, gross XX%. brand Manpower the comprised XX% of Experis business XX%, profit, During Solutions

constant Organic our During year-over-year. increased our the higher of as profit This the XX% brand RPO constant decreases offset increase increased year Organic organic Experis gross solutions gross trends. recruitment. outplacement discussed This well currency brand to in quarter, in in Solutions by Manpower in XX% over was permanent an which MSP currency was earlier profit in strong reported performance year. Right in Management in reflects growth by driven constant currency X% gross year-over-year. profit margin Talent as partially the due and

quarter million. Our in was SG&A $XXX the expense

the offset SG&A in organic an integration quarter addition as XX% higher $X.X the expenses acquisition a was businesses The Experis, million. on billion, various XX% of was continued of revenue. in increases recruiters costs million, an basis. and constant currency of consolidated in after of costs, net adjusting and million, opportunity $XX This Excluding on on in of X% of increase or changes higher an OUP represented the constant costs second in underlying Adjusted currency consisted operational markets incremental by reflects revenue $XX the and a related was reflecting in investment X% $XX to or basis quarter. for Manpower. days. business, constant Revenue basis, RPO currency segment personnel comprised currency acquired SG&A of XX.X% million. percentage $XX constant sales growth Americas in currency of The XX% organic XX%

XX% Americas million, a the OUP margin and country million year. OUP Revenue of segment U.S. adjusted, in revenues. compared the representing the increase, X.X%. was organically, comprising largest $XXX in was is prior As $XX to XX% the was or The segment, XX% U.S.

costs, of to increase adjusted XX%. an acquisition quarter million As our for OUP exclude was representing organic U.S. business integration in the $XX

OUP was adjusted, margin As X.X%.

Within Solutions XX% record profit contributed is levels driven the XX% very had had revenues. remained comprised business of in Within a win and business and strong during deceleration the gross or by XX% the strong of integration profit expect U.S., gross which a strong. in the continued The the U.S. revenue growth double in IT to year-over-year, quarter. quarter. with XX% approximately to Experis Talent perform growth with quarter revenue U.S. growing quarter. MSP X% the as quarter. experienced remained The XX% brand U.S. well anticipate the of strong organic continued acquired Experis we revenue quarter, Within the hiring Manpower skills organically. experienced growth third growth U.S. Revenue organically the the Experis for quarter, quarter. and in Manpower XX% The of third the the during from another profit U.S., Right the first the solid quarter RPO U.S. we revenue brand U.S. the for to recorded programs during low. and in Experis in of career brand Management, XX% XX% X% gross growth slight of range transition the in quarter new the the X% on-going In was strong comprised continued revenue increased comprised digit on-schedule. quarter. of the revenues the very activity in XX% growth business This in U.S. to in proceeding

in Our in approximately trend revenue XX% in of the Mexico the of commencement to expect XX% regulation of of the a August currency a stable We anniversary labor new XXXX. a decline XX% representing to begin third quarter. the and in in quarter, impact operation the regulations decrease constant experienced revenue since the

Europe Southern OUP segment equaled in revenue Southern billion, the and in of the XX% constant came currency. France constant revenue in to supply related comprised in represented the the Revenue OUP was the OUP currency. $XX a Europe chain quarter X% France experienced and consolidated construction revenue in $XXX trend in and, quarter continued impact the X.X%. Europe million X.X%. Russia-Ukraine was and Southern OUP increased X% at of logistics. million $X.X quarter. XX% revenue a growing automotive decelerating disruptions degree, was to sector quarter margin in as during margin lesser and

X%. the we a to year-over-year third France revenue in plus X% quarter, estimating of we the minus range trend constant are begin As for currency

France. million $XXX Our Revenue in reflecting that of constant at midpoint will in represents equaled our was OUP plus represents margin growth currency recent year-over-year on solid have to increase third XX% OUP month mid-single constant Italy of revenue continue growth the increase X% digit third X% for estimate midpoint the the trend We currency. $XX the days-adjusted basis. days-adjusted which June and quarter the was an quarter of range also in in guidance X% quarter equaled in X.X%. million Italy of with a in range revenue a to which the

and represented OUP consolidated organic billing Northern comprised represented adjusted Europe segment $X OUP X% billion in for currency constant of Our margin flat or $XX was in the of X.X%. revenue days. growth XX% was million quarter. Revenue

market largest which is of XX% represented segment U.K., the Our in Europe the quarter. revenues in the Northern segment

in the decreased our During with X% exit low reflects the margin business. well arrangements This currency, replaced performing low expect the quarter, Considering revenue X% to Germany, constant billing quarter. In digit X% decreased currency days-adjusted fee-based U.K. the growth of in and margin business in adjusted quarter. in higher revenues certain U.K. revenues or this, for currency third constant second constant mid-single days. is we

the due the difficult our As automotive workforce, from to bench more the the industry management of the of war. we the sector Russia-Ukraine past, is impact for regulations have impacting recently, discussed and, Germany of one the impact the in most markets outsized

Although the improving in business, rate satisfied in market. Pacific Middle trend segment a company the in have the this year-over-year million was quarter, we XX% third similar made quarter. to currency and of the we In constant we not challenging some $XXX are do The margin revenue. expecting revenue X.X%. improvement are work revenue was in have to progress East more total with million. Asia OUP comprises grew OUP of and XX% Overall, $XX

largest Our APME the constant Japan, XX% is the in grew market quarter. which segment Japan days-adjusted of in currency. XX% Revenue segment in in represented revenues

a the six We now equaled expect In North cash free year-to-date, million in cash in to to revenue positive of performance continued turn second outflow $XX strong we year. cash represented second are third balance during and $XX In the cash by compared outflow cash cash million was payables. quarter business, America year. strong of cash and the the free and very million growth of to quarter, timing $XX a the flow cash outflow $XXX flow with the prior million prior The pleased positive Japan driven I’ll in quarter. flow of free free of flow of our months growth the sheet. compared flow in

flow million quarter. resume about XX represented to sales At free strong at days second in cash Capital the X year-over-year outstanding was second half expect days. of the quarter We days $XX end, expenditures during the year. up

million for million. stock $XXX X.XX shares quarter of the During we repurchased second

As of remaining XXXX. program we the approved June in for under share August X.X have shares million repurchase of XXth,

the ended total XXth, the of $XXX of million XXXX. refinancing Our June September balance of million Euro mature debt the of we a new sheet to scheduled quarter note cash On with amount as and XXX note $X.X of issued our Euro billion. same in part

first proceeds June of we from the July. the sale, the the week maturing Euro With XXth repaid note during

balance the amounts refinancing sheet presented quarter-end. adjusted brief additional As the as a the in the reflect this underlying increase XXth debt our result, debt without ratios the euro debt equaled period. capitalization at temporary The the of note and reflects for at $XXX a result Net on June activity. slide million

Our total debt of at reflect debt trailing capitalization at EBITDA gross quarter-end XX%. and ratios adjusted twelve debt adjusted months to to X.XX total Adjusted total

an in rate Note credit of interest facilities of June the X.XXX%. and Our new reflects debt summary Euro issuance maturing at XXXX effective

has As repaid replaced after now I this issuance previous the note million XXX Euro noted, which shortly was quarter end.

for also During agreement balance our a position. revolving arrangements credit and new strengthen further entered the quarter, into duration term we $XXX million maturing new sheet X-year of new debt a May overall in These credit XXXX.

the million repay XX U.S. We expect prior during quarter. third year to to the remaining the acquisition Experis related

of our outlook review the XXXX. third I'll quarter Next, for

earnings Our an the Europe, third range forecasting quarter material underlying in million no related which guidance impact million unfavorable in $X.XX, not to integration to or are On share per per COVID-XX include war that separately does includes continues from to basis, be operations. disruptions which assume to foreign $X.XX of related out share. Russia-Ukraine the of including beyond additional be acquisition that costs exist today. currency to on-going broken energy of those we projected impacts, impact $X for will This $X.XX the of continue $X

X% This slightly same of quarter to and the revenue X% trend in third represents the at organic basis. a of represents of After disposition at days guidance business, almost growth revenue second X% growth for Experis an billing days-adjusted X%. mid-point. the adjusting from on acquisition Russia, improving our growth the this the currency range between and revenue equal and the constant the is Our midpoint U.S. represents number quarter, stable

revenue incorporates markets France. expect and quarter major be third we in in to construction solid predominately a exception with degree, our and, across continue The verticals to of the France revenue trend growth industry in Germany to lesser which our automotive sluggish

a and assumes throughout the Europe post-holiday no important September third full material stable change Our the trend guidance experiences in in economic quarter period environment demand. assumes quarter

up points We contributing margin both the rate basis quarter to XXXX Experis the and the We the quarter of basis third to the of year with tax XX%. U.S. during midpoint our the XX at business be improvement. EBITDA year prior to estimate the for that acquired XX the full expect effective compared third points be

Jonas. I usual, As share not guidance to average will it estimate back additional repurchases to our does our incorporate XX.X charges turn restructuring million. and or be we weighted shares now

Jonas Prising

Jack. Thanks

particularly We our our continue continues in our create Digitize, business On Diversification, here market and largest as the for market to our to and at talent globally. scale IT globally, nicely key and in U.S., through Innovate, Experis as strategy other investments well the markets progress very Experis strong, Diversify and to make is which where is MyPath the U.K. Academy. to in resourcing share grow and in

acquisition execute Talent public Manpower implementation Digitization hosted our conducted ambitious years. value very attended industry French expanded agenda note wave full Having event offerings just our also for the as our PowerSuite the at employment, business, implementation the market large the in higher is is government’s including sector agenda in France. by seen of a the continue an We which pace, encouraging. global of the Choose labor with completion On our in we I in followed in prior France expands the technology U.S. U.S to Solutions final contributor capabilities which important Macron, July small which that Experis achieve to President France

these executing make excellent successful we the front Experis U.S. quarters. and successfully our quite onto Innovation have IT on office continue U.S. our business progress. transitioned implementations during so quarter, And Global the busy acquired past PowerSuite to We also been the teams in

partner four for Gold offerings solutions brands. capital and people project by from platform resourcing an our at consecutive Manpower innovation showcase as Solutions half Attended our million human year, Experis as we a days, tech we excellent innovations the For as the were VivaTech. Xth VivaTech Talent serves HR and across can which the IT through well

on host Talent event included with we at the our also AI at in-demand innovations We we scale is Age talent, learning do as Tech assessment, and metaverse reskill are sustainable create, with data-driven in HR Academy than and accuracy launched report and which to move matching on into own. as upskill their in of management of the Virtual our Lab, tech with jobs our Experis the showcased well use Manpower most of solutions People to which and than innovation around clients and start-ups meaningful, VivaTech humans During & workers machines machine providing MyPath proud speed The SkillsInSight globally. Governance. represent offering, that RightMap, more people skills Reality were digital could our our commitments tech to all career Planet, or better XX retain using New demand our and to Change Working to our tech Prosperity either our Principles World and ESG develop

sizes Outsourcing be clients recognized capabilities, performance call chair, our year. for talent of of to our our Performer and and Achievement, purpose community Everest Junior categories. millions and the PEAK service in buyers automated of people both and recognition our as people to for XXth now our investment I’d many I and demonstrate global entrepreneurial pleased Global solution Solutions the quarter year of we for the on Diversification, Everest a year IntelliReach, in to of very And world’s meaningful them the Leader every investment, global more Process jobs We strong analytics Rapid our Talent data external million is PowerSuite sustainable continued global young further Manpower the including in tomorrow. reaches open named to Star thank breadth than especially of Assessment of all for and Recruitment today portal. recognizes and Innovation each EMEA portfolio showcase including the and Digitization Global of delivering whose is stack, Group of across honored of our recognition technology Q&A. the to and in reinforcement Matrix examples Recruit employment our hosted Operator offerings, all NGO and which like to another team Group team, also creating finally, and for are good and of rest results XX that and am find other I partners for This our Board Xth that largest

Operator

Thank you. Steinerman [Operator Our of first is from question Andrew Instructions] JPMorgan.

Your line is now open.

Andrew Steinerman

economic of Could know kind here. just you of macro yet? European that fight to seen go banks gave you the give central economic of wanted rates interest to guide a included just a assumption where you wage as And I think quarter we inflation an stable picture. us in sense have cycle and Jonas, are are hiking third terms of environment stabilized U.S. inflation? the over Hi. I you

Jonas Prising

mind, this Andrew. morning, going. is Good – question where the is that everyone’s and Yes, on

of economic are our their still feeling looking pent-up business, our clients help for looking working demand that more ask are are the various as from and when across talked them the about many how automotive that to a they exceptions them well about is with to they for as behaviour the one think that before their I concerned skilled point than client that saying in in equally you the no as on in they in outlook such workers a we pandemic. we What through our prepared remarks, market are as heard from see desire us of clear logistics is observation degree. lesser provide are the about more first quite we able talent, at construction the the to they hand, change is some pandemic own we’ve ways were even industries acquire say this are more they but kind

uncertainty also are operational flexibility certainly to times, immensely discussed turbulent looking us for talent to during to would provide and going important strategic but And navigate through growth with our them their and they times So this we’ve what as view as is is clients going that’s expect be during the forward. Andrew, turbulent we greater environment. in that past

across the So think based we markets, on about we structure what outlook. have good that our were seeing feeling across demand we’re labor I today,

If think you look are markets this wage will noted versus sitting inflation than is perspective, around as discussed is the from strong. to earnings and appears have any in a be very our I then but economy moving Europe call, strong, Labor X% not you U.S. very Europe at U.S. U.S. as Wage in it discernible the what in last is lower way. higher and inflation in we as the rate they would are the growth this a well this rate down to few months in see come well behind, stabilize expect wage you can extent in but to we what growth would and well. of and we coming to inflation than as still the the greater but as the to see in U.S., Europe slightly months, U.S. some in expect of we a stabilize

in far, PMIs U.S. in positive, so and you So, can both Europe being the still see

client in growth slowing labor that. in seeing Andrew, environment, indications of that’s not, of in anything picture. the in a behavior of this markets, And of point, our the terms strength of are any we terms at terms a So different to demand

Andrew Steinerman

Excellent. said. you much. so well That was Thank

Jonas Prising

Andrew. Thanks,

Operator

Thank you, Steinerman. Mr.

of from Our Credit Suisse. next the of line Kevin question is McVeigh

Your line open. is now

Kevin McVeigh

with it Was the lower? the the and us Jack primarily so you or And can mix end that drove on thanks the higher all or revenue profitability? the else color. at sense, that EBITDA a Great, Any was good of for anything takes like the range puts much. give the performance? EBITDA thanks Jonas, versus seems And

Jack McGinnis

be Bridge talk margin offerings range that, I'd happy across Yes, growth board. see end that, I'd businesses higher at the say and no, you to higher higher can Yes, the Kevin. had the look as of the to you GP the

impact growing really then digit through the businesses through. down importantly, Talent of So GP going growth. EBITDA And to our at those margin. but coming both Experis coming that's drop Solutions our faster, impact of margin, when the to of are that's them That's both double

impact had perm part Certainly recruitment continue an that's so our to that strategy had trend. as of well. And on-going

And the quarter. in item that year Kevin, pretty EBITDA clean seeing a really GP margin. firm But so that that was a been end ago, direct the of know as we and it year. top our impacted I'd we had that I hiring biggest earnings have And other the was on the pretty trends well, we've big cost that that's consistent, range markets. than say largest this driver that, actually didn't adjustment across strong, in a bridge, that

the considering basis last points, it's was an that flatter on better overall basis. XX you in basis basis that, So bit year-over-year, up XX fact a if underlying year an consider on the actually

trend. terms say what in I'd of that's So EBITDA the

Kevin McVeigh

driver in at. behavior just of real That's terms any call dramatic in out obviously, obviously are like is currency, helpful. guidance the within and Ukraine a But where shift seems war an FX context? or perspective a And then client any that just from big just energy, other? from the one currency client it's in perspective the quick, given shift the in Again, of and outsized seeing in or just the way you industries the shift impact energy different you'd just

Jack McGinnis

operate in market. from the our largely no, FX we perspective, Yes, in currency local an I'd no, say

a seeing client not an really as markets, from FX impact impact in demand result, So doesn't so our we're FX. major

it's I I in think, not certainly more general from been on similar energy an energy has think, that demand a so and been But to year-over-year inflation severe. standpoint, Jonas's Europe, far standpoint, certainly services. impacted our to for contributor comments, a has

about sectors that been by we've not significant certainly So impact supply chain disrupted issues. have talked on seen have a we the

that reasons. side, seen haven't significant basis, but those could we some energy And on related, a impact really overall putting on of an to demand the be supply disruptions chain for

Kevin McVeigh

much. so you thank Awesome,

Operator

Thank you.

Jeff from is Silber question next Markets. coming BMO Our of Capital

is line open. now Your

Jeffrey Silber

changes to any he Thanks did in this, in so won alluded I positive going much. President see governmental not Do because but of win. Macron you his you forward election either Jonas, negative his party structure or France. briefly know France?

Jonas Prising

they biggest of in them Group to how time good What's objective aspects France, players progress is the the see of Macron intend our main perspective, from important full him under program. structural administration, Lamar to far the next right the overly they but role, they their and don't Spending Macron you where think through is that the with to outlined I relevant on helping programs our ability very and by -- Macron level that, about election. to reforms well in about. our of their have in speak that important many opposing in is of our Talking of is to commitment the reform during and the in have lot to as to asking very have be terms budget, there. any which that the implemented. forward. remember, change left, business change have tax their employment, course drive tax the for drive a really of time ability stated feel programs last structural parliament about their and XXXX [ph] his various their the also as labour smaller player, hearing feel positive. administration to on the he business or about with what's appear very They reaffirmed hearing the views how the thinking get And terms Jeff, they're and minister week to of most We employment Bruno And concerned on there ministries in and about of our contributions and President our a all from have listening and France, they move talked the perspective pillars of clearly good that you their Manpower and important

in. vote the various to administration especially to to such, extremes on broader against majority the have and it be initiatives that and about are So an as very the as unlikely likelihood against drive seems I course, very going important that extremely labor able in, France and for that market the go that of us policies unite Macron against well but all continue feel that administration And unlikely, and think is to competitive, to the to say more going we possible, market Macron would and I a the very make French be to the good that we're reason, do economic through. interested for able the of markets

Jeffrey Silber

disruptions, gears they're into clients, get supplies, worse Okay, any discussions it's shifting hearing from bit really mentioned potentially anywhere else we been they I especially Germany, know, off related And helpful. of talking the in more And in broadly, number your those Russian Germany, Thanks. or may either along of you've in if winter. any Europe? but as be lines about times, reading you then early, rationing. that's energy cut are head little still a things a we've

Jonas Prising

and French papers week, Overall, their hypothesis, as, the and preparations I'm instance, gas eventuality. the, zero of around mean. lot with making last of are, that then the that you And is reading in the government what the very just around would supply is sessions their Europe as planning into a in that for for Europe the

their as how happen, it to talent changing of used react course, different can that are on on well. winter, see happens. would be point, are difficult. appear if well be that options Also, So feel it what, to severe. coming the Outlook, be trying to seeing. Europe their that, that's or We to more actually to think, we behavior severity we're clients do that winter, alternatives. need of know, that don't they, of appears could our something there of back the resolved to. this winter, you find out But around mild execute we for and and are things working as it do the to it's any we in whether is doubt, preparing, are what And And means these it quite than control. in And no us, at now, that that's are it's ways you strategies. this a it and could of on fully as be business a be ready to reacting of depending have more aware would to our it'd this and case us what their market entirely we less become difficult. what that's, changes but quickly I would them very for anything they the just If And all to That's, to they it'd tell, severe asking

Jeffrey Silber

Okay, color. appreciate the really Thanks so much.

Jonas Prising

Jeff. Thanks,

Operator

Baird. line of next Marcon is of Mark from Our question the

now is line open. Your

Mark Marcon

and Solutions bit slow think the Jonas a operating Wondering, Good are, and within sensitivity bit if particularly talk mix. Talent perm Obviously, business Solutions, things down you morning, for in Talent can I'm how a further. a expectations that cyclical about little fairly Experis? significant as wondering, well your little shift Jack. of what terms of the how business in had as terms you And you you've

Jonas Prising

a hard would labor the recession it's maybe today, a the if pandemic, perspective, more clients that a proximity of variety that what market finding view they've heard our But the that's a it is serve frankly, what find me and staffing from then if lighter cyclical, their hard positive margins. on working us that diversification, at a tends and at would what be I so prepared to are think sometimes especially resourcing happen, still very same well, the companies recession, execute EBITDA time, environment or diversification a technical to that have in after react worked think us we talent to more then cyclical temporary Jack shallow of Perm this about in downturn and the if make the how we're remarks shift the very And say, downturn. say talent that business increase, to need remember will operating like in doing on a And mix that, will was or at they plans. the we our to talked solutions. as during to the Well pandemic. the were you looking and

into down be think we us position perspective, because Solutions, and we from the or ramp we up can as Manpower, greater very have both resourcing a Experis a we Talent and across for a need the temporary good of for go as flexibility obtained side, perm well company the on time as behalf. So that a will quickly on their on contingent side that from

I we the in looks that than and like, talent what business our the of what a that market give opportunity from pandemic, the past. business us seen the have in a to mix, shortage could and So memories have position to kind we both we the of proximity think resilience experience model diversification more actually

Mark Marcon

That's a benefit seeing that be great. being And international of then, your obviously, extent, the exported could the clearly U.S. a to extent you business U.S. margins. the the template basically has regards And across what with To greater operations? diversified to the think as do we're most.

Jonas Prising

would Mark, especially Well, that clearly, and Latin in quite due Pac, as we in is itself Europe. I what Asia composition are in business the seeing the market diversification many different that driving that U.S. is time, U.S. many in geographies the of well. in in note, though, you're other the America, the other from and

we and strategy in growing will contingent think and we're it's to market, Talent also the diversification that specializations, Manpower having of faster our margin, than the pushing the a in all within important something the levels, that bigger and in also that between within and businesses Pacific. side brands. across Latin same. side. see Experis that, good composition, higher both market is with And harder. in Europe continue said see is But, from skilled composition what America Solutions diversifying is I some higher U.S. Manpower, So brands, going own drive remember perm to especially diversification we We're geographies, much business But the to be terms of in from in our you and Mark. our In our to growth the market Asia the a

Mark Marcon

you. thank Great,

Operator

Thank you.

of question from line is Coast Research. North Kartik next of Our Mehta the

Your line is now open.

Kartik Mehta

haven't Is and any at clients concerned economy, talked any that about surprising a not clients making changes. bit little changes behavioral the concerned you've all reading they're Jonas, changes? bit but demand that a morning, or Good little about are are about your made the but economy,

Jonas Prising

and understanding and we're same what are up have their chain having and the doing looking bring recruitment individual cooling business stock they are may central clearly a well, businesses inflation, that's Kartik banks staffing indicating, may down but time, think in and issues they experienced I great through the out, activities means seeing and the they demand world still reading across that the to what that working are the have economy. trying supply at pent are which their down the is order the they're

a So are seeing they strong of they what business for living are a but is environment the reality intent, continued them.

a bit it's bending. question going the a where, time economy be bit of, this of So all to a a is

very working prepared which due impacting our most, services. growth, And back strong, produce or bit, ability slowing what with cooling economic They supply that of of we remarks, markets, coming coming may is So mentioned, growth difficulties their off behavior. at I remaining then express improved into kind. that's and think environment a but in chain, down of labor be them most this clients or certain demand point, and in deliver none to are the drops we're manufacture experiencing to to changing not continue little they that are some But economies as recessionary debating. a to are

still at dealing that's this they're what with So stage.

Kartik Mehta

talent talked talent availability, greater that does one rate growth into the about just bit how slowing? wage you then question, of translating last availability, a look And you? or for little inflation availability and Is

Jonas Prising

past, first, to our talking And those inflation our specific us, the priorities. impact on this is on top and Well, do watch talked something inflation is to we've global what about we know model, to the be the pass to business economy, inflation inflation recovery. the so the arrangements, about we to majority benefits able to find wage of terms going generally, recruit talent. wage be the on to as that's as need in clients. of in and the And clearly, there But,

is on that it as working effect although cooling the something we on economy generally So a see risk business our still inflation, model, can from speaking, is the well.

Jack McGinnis

into where And about the that talked terms and the been Jonas in in has one past lot availability in it the starting was of is U.S. Kartik continuing I the the quarter summer. just was supply, about have we fourth and supply talked the saw last vocal And was past quarter, what difficult improved. very of where add in first would market we very the that to we a

in trends those quarter the generally the particularly brand through that are staffing side things. second up. commercial of So update holding Manpower on is the and And the

has supply that So say be for extreme. I us generally, And about. U.S., that opportunity trends going based which improved on been used to be the current an is would talking that in the we've to these

we've clouds the reasons So terms supply. should on there although many in are favorable of for that economic for all been impact be out this talking could so some that call, about there, be

And the side. factor for that staffing on but an offsetting really be commercial, will so us,

Kartik Mehta

I really you very appreciate much. it. Thank Perfect.

Operator

Thank you.

next one Tobey Mr. Truist. is in queue of Sommer Next,

now is open. line Your

Tobey Sommer

staff Thank but In are still you geographies the business? context managing of your uncertainty, macro the an sales growth own lines related you. How across your and unwavering demand. in of

Jonas Prising

past our quarter call, of you that's on great in RPO specializations Toby, and the in invest opportunities in the in areas in number the in are to offerings been might see have talent As we markets. we continuing there the heard Manpower Experis notably, where in perm in

now comes we are Having opportunities and are the as the is the above able of and levels point, leaning in as talent we we're that investing for where we well those feel we and opportunity good salespeople this brands. growth that and hiring we pandemic pre third a Group have And that it coming Manpower about adapt well still our talent. also there to at monitor course forward within of had are that investing we that, very quarter. exists recruiters as by but across think to posture evolution said closely we’re So still three into

Tobey Sommer

business or halted stuff? investment And conversely, sales lines in related where or geographies you or pockets there of are any slowed

Jonas Prising

an and difficulties, look more still But about specific in outlook as in recruitment, cautious. is feel back Also, had that, more see we such we're more where in the being could we've adding automotive Talent in maybe clearly an pockets, with could due to of within and good that you challenging. resources countries in we're where Well, even there pulling Germany. permanent we're that's Solutions, Germany looks more sector, notably areas the area in

well. assessment and an basis So that brand by on an on basis, on country on-going we a brand country continuing a by as make

Jack McGinnis

And Toby. I’ll add that, to

as entire U.S. in as pandemic, adding and very So special where But about, talked there not very the primarily continues really coming and been clearly during also growth. Japan, to market I Italy include businesses the have point, parts Solutions in would that see that that largest look top a probably in Jonas's of Manpower. the through near businesses, add Japan when as we've the is the grew digit of in list. by we've been in businesses, there, we in sectors those has that would chain Experis investing to you that's impacted salespeople across are heavily they've again, well. supply Talent and, strong And expect, would very you the and I those it's our double And been results. I the

growing permanent had very, been recruitment, very through Italy's very And strong nicely. as well. has some coming Italy, So

color. So a of bit just little

Nordics positive I I trends growth we're the good add good think, continued the there. growth seeing for list well. well, seeing to would as as opportunities very And

Tobey Sommer

much. very you Thank

Operator

Tong Sachs. George of from is question next Our Goldman

now is line open. Your

George Tong

where And you Good markets I business. Taking labor you're weakness? revenue thanks. the that mentioned How are that reconcile Hi, of than seeing in trends with you growth that do pockets back, strong? softer step morning. Manpower organic you brand observation a the seeing expected remain your guess

Jonas Prising

levels, employment also -- that a labor or it's high come in in is the streaming leisure that pulling against weakness very as they're traded here in comes of Notably, and it supply few chain. than you unemployment Europe the is product products, pre companies markets, surge Jack can by just the see the our consumers really the in of consumers. is being only weaknesses unemployment, see pulling are spend we And U.S. would low. that decades, travel, mentioned, pockets And saw from very impacted the be is been if of lot are a you pandemic that in tech and are Consumption at weakness that by higher look of European the of pandemic, the retail can during and some pockets you between The where participation are bit. above see back. far rates tech the U.S., a sectors the through back instead case experiences in and

U.S. excess some point within then picture certainly the true, of by you this seeing economy. are are the but step still weaknesses both Europe. the labor the overall at you if very, back, the healthy. So look that's at in of for And parts and absorbed other and And demand shifts the you're and strength markets labor market, very

George Tong

market in latest Based France, we're the Can temp staffing there drivers? data growth. it. and the French a in Got seeing the labor on key on slowdown you PRISM conditions elaborate

Jonas Prising

as bullish labor an very all market the own can well French as minister see being we down. been the I business, economy. his French we to to speaking really seen PRISM hit reflects labor French market materials important the think have of No, still automotive pool way market part our Yes. the for has outlook through particularly around of And of last the the year. the the But and the is week, French data end that access the construction, reality

mandated in So and George, they in increase retirements despite and are you Europe based. an as retirements are age know,

very to job So to the market creation the the outflow labor on rates continue from expects in offset continue up that move shape. decline, to to he is basis, and participation market known to year-by-year good be labor a

of strong, the certain sectors. is in French still So it pockets labor weakness but does market looking have

most since XX outlook the good. the still at over this overall, -- coming companies the the related, over is say, which Now course improve France would supply will labor those is looking to months, chain of in market believe many start are point I for

George Tong

Very helpful. Thank you.

Operator

question Our in C.L. Mr. King. last Silver from David queue is

now is line open. Your

David Silver

attitudes a question, Yes, utilizing I guess, customer I you. outsourcing towards hi services. Manpower's thank about had

outsourcing do situations Manpower's slower slowing they other geopolitical uncertainty is maybe attitudes to might some the slowing words, regionally. is if base to global their a more Manpower you of economy kind choose guess, Or maybe to facing touch I to events, see case In you. cost internally differ things captively? Thank just demand Europe is maybe do -- an economic by in a to in customer then we U.S. tapping services. environment, and if if So functions? responding slowing the maybe are opportunity related mean they reduce see you But Europe how as economy, the in could handle outsourcing utilizing if it towards greater a that somewhat on handle I slower fixed So alternatively there a economy?

Jonas Prising

markets environment where the benefiting pivot should the be opportunities, labor, in companies means penetration supply The the supply a labor resort have them in very that take also as to further that provide knowledge really companies as in growth operational services that use in from slowing strategic Experis scenario, two to scenarios tight, an The you the of more of to consider slowing good market improving but more tend degree the and we a think and about, greater able only U.S. even Manpower, of as turndown frankly, flexible, Europe, because to then rates, beneficial and to and we a slowing terms flexibility. And which are are slowing labor. improved become adaptable, want the of Talent our twofold. a gradual the some have as could for available well not in services, quicker frankly, of can increased to an and Solutions economy our rates you

pandemic, reduces a experienced extreme during of brief the such the labor or the and very severe period the trend XXXX, XXXX a in you services, as downturn, that overall. for Of that a need mainly get for we more its downward the course, one reduction in our provision from surprising and event in quick to big very and comes of time

elsewhere. knowledge the as XX are is and what believe as what scenarios the expansion that those about but headwind, guess well we're U.S. I being is at you So slowing about now in both still and two Europe in of seeing can economic think growth, an PMI we least in

that's for are based did think, the us third outlook guided we continue way to good the quarter, we third have still for we quarter. some into opportunities there and on that the we growth, So the why

David Silver

dollar Thank $XXX about Can cash have chosen other you think share a also increased very ask words, needs economy terms outlook? related much. And buybacks at the pretty to by to the just quick strategies relates I and you've one to year-to-date, it In to accelerate economic your conduct working your I and capital how or overall in deployment million. level. high question

company's you to should the you. see ability into here given itself? economic it, should as overall interpret words, the other variations increased me Or meaningful the other some a management Just driving are taking to aspects in Thank or confidence indicate as be the seemed there outlook indicating manage the consideration? outlook economic cash ability what's to confidence your which in your the first manage whatever whatever rising half, or maybe cash programs to scenario confidence deployment strategies that for your -- deployment presents I to In that and you I in demand see?

Jack McGinnis

question. And briefly. to David, Thanks, that that talk for I'll

with start I'd unchanged. strategy what really think is capital I our allocation remains

that track confident. pretty a we have we are agree with think your would record. I consistent I statement

the cash with the our balance our and confident free profile overall. of quite are sheet, with efforts we collection cash think I opportunity flow

referring really you're what is in And that quarter. allocation the repurchase we we've to plan second on opportunistic. were share our what reflecting think of you're our capital element I we're that is open been opportunistic So very

You saw a level higher of repurchases. share

market we were purchases able average good we're in to pretty June, some some in price favorable and in the levels. at pretty So

of said should So an overall. I dividend would that, allocation going priority. expect always to be say is We've the a element capital we the way continue important to that's that at you look

the increase May. our nice saw that You dividend in approved Board

very a is resources progressive But if And first environment, be will to is the is devoted proud there the as the cash, an the that were the stable beyond well. for acquisition stable you acquisition. so the And of depth of dividend if additional that in good, that, increases. we there expect pandemic the and thing should fact economic held we

You saw part overall you capital that an with there isn't of be acquisition, will share important the an repurchases allocation Attain program. expect Group our then purchase. should if continue And to that

I So say that. would

So I'll for comments. thank to And it turn over you Jonas. the

Jonas Prising

quarter look us your for speaking you earnings of rest Jack, much very you with our you, and a you and forward call. to that on good second to Thank attending. Thank our earnings we Thank summer. the brings end call. of Thanks, Have questions, the for everyone. next

Operator

Thank for call. all joining. concludes that and speakers, you, today's you Thank

disconnect. now may You

ManpowerGroup (MAN) 19 Jul 222022 Q2 Earnings call transcript