SEC Filing | ManpowerGroup Inc.

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10-Q

United States

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended:

June 30, 2022

☐ Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from: ______to______

Commission file number: 1-10686

MANPOWERGROUP INC.

(Exact name of registrant as specified in its charter)


	Wisconsin	39-1672779
	(State or other jurisdiction of incorporation)	(IRS Employer Identification No.)

	100 Manpower Place
	Milwaukee, Wisconsin	53212
	(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (414) 961-1000

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered

Common Stock, $.01 par value	MAN	New York Stock Exchange

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


		Shares Outstanding
Class		at August 3, 2022
Common Stock, $.01 par value		51,742,043

ManpowerGroup Inc.

INDEX


		Page Number
PART I	FINANCIAL INFORMATION
Item 1	Financial Statements (unaudited)
	Consolidated Balance Sheets	3-4
	Consolidated Statements of Operations	5
	Consolidated Statements of Comprehensive Income (Loss)	5
	Consolidated Statements of Cash Flows	6
	Consolidated Statements of Shareholders' Equity	7-8
	Notes to Consolidated Financial Statements	9-24
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	25-41
Item 3	Quantitative and Qualitative Disclosures About Market Risk	41
Item 4	Controls and Procedures	41

PART II	OTHER INFORMATION
Item 1A	Risk Factors	42
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 5	Other Information	42-43
Item 6	Exhibits	44

SIGNATURES		45

PART I - FINANCIAL INFORMATION

Item 1 – Financial Statements (unaudited)

ManpowerGroup Inc.

Consolidated Balance Sheets (Unaudited)

(in millions)

ASSETS


	June 30, 2022		December 31, 2021
Cash and cash equivalents	$	886.2	$	847.8
Accounts receivable, less allowance for doubtful accounts of $115.9 and $121.6, respectively		5,343.9		5,448.2
Prepaid expenses and other assets		171.8		126.7
Total current assets		6,401.9		6,422.7

Other Assets:
Goodwill		1,669.9		1,722.2
Intangible assets, less accumulated amortization of $448.7 and $441.3, respectively		560.9		583.6
Operating lease right-of-use assets		314.0		373.4
Other assets		561.8		610.2
Total other assets		3,106.6		3,289.4

Property and Equipment:
Land, buildings, leasehold improvements and equipment		568.0		594.9
Less: accumulated depreciation and amortization		458.0		478.1
Net property and equipment		110.0		116.8
Total assets	$	9,618.5	$	9,828.9

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ManpowerGroup Inc.

Consolidated Balance Sheets (Unaudited)

(in millions, except share and per share data)

LIABILITIES AND SHAREHOLDERS’ EQUITY


	June 30, 2022			December 31, 2021
Current Liabilities:
Accounts payable	$	3,023.2		$	3,039.2
Employee compensation payable		229.9			299.4
Accrued liabilities		540.8			584.7
Accrued payroll taxes and insurance		704.8			789.1
Value added taxes payable		421.4			515.5
Short-term borrowings and current maturities of long-term debt		481.0			552.6
Total current liabilities		5,401.1			5,780.5

Other Liabilities:
Long-term debt		942.2			565.7
Long-term operating lease liability		222.2			275.8
Other long-term liabilities		608.2			675.2
Total other liabilities		1,772.6			1,516.7

Shareholders’ Equity:
ManpowerGroup shareholders' equity
Preferred stock, $.01 par value, authorized 25,000,000 shares, none issued		—			—
Common stock, $.01 par value, authorized 125,000,000 shares, issued 118,009,931 and 117,762,065 shares, respectively		1.2			1.2
Capital in excess of par value		3,465.8			3,444.7
Retained earnings		3,777.2			3,634.6
Accumulated other comprehensive loss		(471.5	)		(389.4	)
Treasury stock at cost, 65,943,910 and 64,165,136 shares, respectively		(4,337.5	)		(4,169.4	)
Total ManpowerGroup shareholders’ equity		2,435.2			2,521.7
Noncontrolling interests		9.6			10.0
Total shareholders’ equity		2,444.8			2,531.7
Total liabilities and shareholders’ equity	$	9,618.5		$	9,828.9

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ManpowerGroup Inc.

Consolidated Statements of Operations (Unaudited)

(in millions, except per share data)

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021
Revenues from services	$	5,074.1	$	5,277.1	$	10,217.4	$	10,201.5
Cost of services		4,152.9		4,417.0		8,399.1		8,573.3
Gross profit		921.2		860.1		1,818.3		1,628.2
Selling and administrative expenses		740.5		690.2		1,498.9		1,359.9
Operating profit		180.7		169.9		319.4		268.3
Interest and other expenses, net		6.7		2.8		9.4		8.2
Earnings before income taxes		174.0		167.1		310.0		260.1
Provision for income taxes		51.8		55.5		96.2		86.5
Net earnings	$	122.2	$	111.6	$	213.8	$	173.6
Net earnings per share – basic	$	2.32	$	2.05	$	4.02	$	3.17
Net earnings per share – diluted	$	2.29	$	2.02	$	3.97	$	3.13
Weighted average shares – basic		52.7		54.5		53.2		54.8
Weighted average shares – diluted		53.4		55.4		53.8		55.5

ManpowerGroup Inc.

Consolidated Statements of Comprehensive Income (Unaudited)

(in millions)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Net earnings	$	122.2		$	111.6		$	213.8		$	173.6
Other comprehensive gain (loss):
Foreign currency translation adjustments		(122.1	)		28.3			(158.0	)		(68.2	)
Translation adjustments on derivative instruments, net of income taxes of $14.1, $(4.2), $20.7 and $10.2, respectively		48.7			(14.2	)		71.6			35.4
Translation adjustments of long-term intercompany loans		(1.0	)		0.6			1.5			6.2
Gain on interest rate swap		2.0			—			2.0			—
Defined benefit pension plans and retiree health care plan, net of income taxes of $0.2, $2.3, $0.3 and $2.6, respectively		0.5			0.8			0.8			1.6
Total other comprehensive (loss) gain		(71.9	)		15.5			(82.1	)		(25.0	)
Comprehensive income	$	50.3		$	127.1		$	131.7		$	148.6

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ManpowerGroup Inc.

Consolidated Statements of Cash Flows (Unaudited)

(in millions)


	Six Months Ended
	June 30,
	2022			2021
Cash Flows from Operating Activities:
Net earnings	$	213.8		$	173.6
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		42.5			34.4
Loss on sale of a subsidiary		8.0			—
Deferred income taxes		2.8			(13.3	)
Provision for doubtful accounts		6.1			9.2
Share-based compensation		21.6			16.9
Changes in operating assets and liabilities, excluding the impact of dispositions:
Accounts receivable		(218.3	)		(381.7	)
Other assets		(18.0	)		(6.3	)
Other liabilities		(37.2	)		362.6
Cash provided by operating activities		21.3			195.4

Cash Flows from Investing Activities:
Capital expenditures		(41.7	)		(24.6	)
Acquisition of businesses, net of cash acquired		—			(7.1	)
Proceeds from the sale of subsidiaries and property and equipment		1.0			0.9
Cash used in investing activities		(40.7	)		(30.8	)

Cash Flows from Financing Activities:
Net change in short-term borrowings		(3.9	)		3.1
Repayments of revolving debt facility		(25.0	)		—
Proceeds from long-term debt		416.1			0.3
Repayments of long-term debt		(2.5	)		(2.2	)
Payments for debt issuance costs		(1.5	)		—
Proceeds from derivative settlement		2.0			—
Payments of contingent consideration for acquisitions		(1.4	)		(6.2	)
Proceeds from share-based awards		0.3			4.2
Payments to noncontrolling interests		(1.0	)