ManpowerGroup 2014 Annual Report Download - page 31

ManpowerGroup | Annual Report 2014 29
• revenue decline in the United States of 1.4% primarily due to a decrease in our larger strategic account client revenues
because of softening demand, a large client project in our Manpower business line that concluded in the first quarter of
2013 and strong price discipline on new business opportunities;
• revenue decrease in APME of 10.3% (–1.4% in constant currency) primarily due to the decline in demand for our staffing/
interim services, resulting from two fewer billing days and legislative changes in China that restricted the use of temporary
employment and to a decline in our TBO revenues due to the loss of a Japanese client; and
• decreased demand for talent management services at Right Management, where these revenues decreased 7.1% (–6.6%
in constant currency); partially offset by
• our acquisitions of two entities in April 2012, one in Southern Europe and one in the Americas, and one entity in April 2013
in Northern Europe, which combined to add 0.3% of revenue growth to our consolidated results.
The gross profit margin remained flat year-over-year as the 10 basis point (0.10%) favorable impact from the improvement in
our staffing/interim margin was offset by a 10 basis point (0.10%) unfavorable impact resulting from the 7.3% year-over-year
decline in our permanent recruitment business. Our staffing/interim margins improved slightly in 2013 as the increases in
the United States and Southern Europe, due to the benefit of the CICE payroll tax credit, were offset by lower gross profit
margins in many European and APME markets and a social security reserve recorded in France.
The 5.8% decline in selling and administrative expenses in 2013 (–5.7% in constant currency and –6.0% in organic constant
currency) was attributed to:
• a 6.1% decrease in our organic salary-related costs, because of lower headcount;
• a 6.3% decrease in lease costs because we closed over 300 offices in 2013, as a result of office consolidations and
delivery model changes;
• a decrease in legal costs in 2013 compared to 2012, primarily related to the $10 million settlement agreement in 2012 in
connection with a lawsuit involving allegations regarding the Company’s vacation pay practices in Illinois; and
• a 10.5% decrease in non-personnel related costs, excluding legal and lease costs noted above, as a result of the
simplification and cost recalibration actions taken in the fourth quarter of 2012 and during 2013; partially offset by
• restructuring costs of $89.4 million in 2013 compared to restructuring costs of $48.8 million in 2012, comprised of $9.8
million in the Americas, $3.8 million in Southern Europe, $13.2 million in Northern Europe, $0.7 million in APME, $10.9
million at Right Management and $10.4 million in corporate expenses; and
• the additional recurring selling and administrative costs as a result of the acquisitions in Southern Europe, Northern
Europe and the Americas.
Selling and administrative expenses as a percent of revenues decreased 60 basis points (–0.60%) in 2013 compared to
2012. The change in selling and administrative expense as a percent of revenues consists of:
• a 50 basis point (–0.50%) favorable impact due to the decrease in our organic salary-related costs and lease costs;
• a 20 basis point (–0.20%) favorable impact due to the decrease of non-personnel related costs, excluding legal and lease
costs noted above, as a result of the simplification and cost recalibration actions taken; and
• a 10 basis point (–0.10%) favorable impact due to the decrease in legal costs as noted above; partially offset by
• a 20 basis point (0.20%) increase due to the restructuring costs of $89.4 million in 2013 compared to $48.8 million
in 2012.
Management’s Discussion & Analysis