ManpowerGroup 2012 Annual Report Download - page 32

CONSOLIDATED RESULTS — 2011 COMPARED TO 2010
The following table presents selected consolidated financial data for 2011 as compared to 2010.
Reported Variance in Constant Variance in Organic Constant
(in millions, except per share data) 2011 2010 Variance Currency Currency
Revenues from services $ 22,006.0 $ 18,866.5 16.6% 11.6% 9.7%
Cost of services 18,299.7 15,621.1 17.1
Gross profit 3,706.3 3,245.4 14.2 9.4 7.4
Gross profit margin 16.8% 17.2%
Selling and administrative expenses,
excluding impairment charges 3,182.1 2,938.6
Goodwill and intangible asset impairment charges —428.8
Selling and administrative expenses 3,182.1 3,367.4 (5.5) (9.2) (10.7)
Selling and administrative expenses as a % of revenues 14.5% 17.8%
Operating profit (loss) 524.2 (122.0)
Operating profit margin 2.4% (0.6)%
Net interest expense 35.5 37.5 (5.4)
Other expenses 8.8 5.7 55.1
Earnings (loss) before income taxes 479.9 (165.2)
Provision for income taxes 228.3 98.4
Effective income tax rate 47.6% 59.5%
Net earnings (loss) $ 251.6 $ (263.6)
Net earnings (loss) per share — diluted $ 3.04 $ (3.26)
Weighted average shares — diluted 82.8 81.0 2.3%
The year-over-year increase in revenues from services was primarily attributed to:
• increased demand for services in most of our markets, including the Americas, Southern Europe, Northern Europe and
APME, where revenues increased 14.5%, 12.3%, 9.3% and 14.2%, respectively, on a constant currency basis;
• our acquisition of COMSYS in April 2010, which added approximately 1.0% revenue growth to our consolidated results in
2011. In 2011, the United States and the Americas experienced revenue growth of approximately 6.0% and 10.0%,
respectively, on an organic constant currency basis;
• our acquisition of three entities in APME during April 2011 and Proservia in Southern Europe during September 2011,
which added 0.9% revenue growth to our consolidated results. In 2011, APME and Southern Europe experienced revenue
growth of 7.6% and 11.9%, respectively, on an organic constant currency basis; and
• a 5.0% increase due to the impact of currency exchange rates; partially offset by
• decreased demand for services for Right Management, where revenues decreased 16.6%, on a constant currency basis,
including a 25.9% decline on a constant currency basis in our outplacement services.
The overall 40 basis point (–0.40%) decrease in gross profit margin was attributed to:
• a 30 basis point (–0.30%) decline due to the outplacement revenue decline of Right Management, where the gross profit
margin was higher than our Company average;
• a 10 basis point (–0.10%) decline from our staffing/interim business, because of pricing pressures during the latter part of
2011 due to the economic environment and a decrease in French payroll tax subsidies; and
• a 10 basis point (–0.10%) decline due to our acquisitions in APME; partially offset by
• a 10 basis point (0.10%) favorable impact due to the growth in our permanent recruitment business.
The 5.5% decrease in selling and administrative expenses in 2011 (9.2% decrease in constant currency) was attributed to:
• a $428.8 million goodwill and intangible asset impairment charge in the fourth quarter of 2010 related to Right Management
and Jefferson Wells as compared to no impairment charge recorded in 2011; partially offset by
• an increase in our organic salary-related costs due to salary increases, and an increase in headcount in certain markets
in response to the increased demand;
MANAGEMENT’S DISCUSSION & ANALYSIS
of financial condition and results of operations
ManpowerGroup 2012 Annual Report Management’s Discussion & Analysis
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