KELLY SERVICES INC - FORM 8-K - EX-99.1 - EXHIBIT 99.1

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8-K - 8-K - KELLY SERVICES INC	form8-k2014thirdquarter.htm

Exhibit 99.1

KELLY SERVICES^® REPORTS 3^rd QUARTER RESULTS

TROY, MI (November 5, 2014) -- Kelly Services, Inc. (NASDAQ: KELYA) (NASDAQ: KELYB), a leader in providing workforce solutions, today announced results for the third quarter of 2014.

Carl T. Camden, President and Chief Executive Officer, announced revenue for the third quarter of 2014 totaled $1.4 billion, a 3.8% increase compared to the corresponding quarter of 2013.

Earnings from operations for the third quarter of 2014 totaled $7.1 million, compared to $20.2 million reported for the third quarter of 2013. Included in the results of operations in the third quarter of 2014 are restructuring charges of $4.0 million. The results of operations in the third quarter of 2013 included restructuring charges of $0.5 million. Excluding the restructuring charges from both years, earnings from operations were $11.1 million in the third quarter of 2014, compared to adjusted earnings of $20.7 million last year.

Diluted earnings per share in the third quarter of 2014 were $0.03 compared to $0.49 per share in the third quarter of 2013. Adjusted earnings per share were $0.10 in the third quarter of 2014 compared to $0.51 in the third quarter of 2013.

“We’re pleased with our third quarter performance,” said Camden. “2014 has been a year of aggressive strategic investments at Kelly, and we’re seeing early signs that those investments are gaining traction. We are now a leaner, more efficient company that is focused on growth and well-aligned with market demands for high-margin specialty staffing and holistic talent supply chain solutions.”

Kelly also reported that on November 4, its board of directors declared a dividend of $0.05 per share. The dividend is payable December 5 to shareholders of record as of the close of business on November 17.

In conjunction with its third quarter earnings release, Kelly Services, Inc. will host a conference call at 9:00 a.m. (ET) on November 5, to review the results and answer questions. The call may be accessed in one of the following ways:

Via the Telephone:


U.S.	1 800 288-9626


International	1 651 291-5254

The pass code is Kelly Services

Via the Internet:

The call is also available via the internet through the Kelly Services website:

www.kellyservices.com

This release contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. These factors include, but are not limited to, competitive market pressures including pricing and technology introductions, changing market and economic conditions, our ability to achieve our business strategy, our ability to retain the services of our senior management, local management and field personnel, our ability to adequately protect our intellectual property rights, including our brand, our ability to successfully develop new service offerings, our exposure to risks associated with services outside traditional staffing, including business process outsourcing, the risks associated with past and future acquisitions, exposure to risks associated with investments in equity affiliates, material changes in demand from or loss of large corporate customers, risks associated with conducting business in foreign countries, including foreign currency fluctuations, availability of temporary workers with appropriate skills required by customers, liabilities for employment-related claims and losses, including class action lawsuits and collective actions, liability for improper disclosure of sensitive or private employee information, our ability to sustain critical business applications through our key data centers, our ability to effectively implement and manage our information technology programs, our ability to maintain adequate financial and management processes and controls, impairment charges triggered by adverse industry or market developments, unexpected changes in claim trends on workers’ compensation, disability and medical benefit plans, the net financial impact of the Patient Protection and Affordable Care Act on our business, the impact of changes in laws and regulations (including federal, state and international tax laws and the expiration and/or reinstatement of the U.S. work opportunity credit program), the risk of additional tax or unclaimed property liabilities in excess of our estimates, our ability to maintain specified financial covenants in our bank facilities, our ability to access credit markets and continued availability of financing for funding working capital, and other risks, uncertainties and factors discussed in this release and in the Company’s filings with the Securities and Exchange Commission. Actual results may differ materially from any forward looking statements contained herein, and we have no intention to update these statements.

About Kelly Services^®

Kelly Services, Inc. (NASDAQ: KELYA, KELYB) is a leader in providing workforce solutions. Kelly^® offers a comprehensive array of outsourcing and consulting services as well as world-class staffing on a temporary, temporary-to-hire and direct-hire basis. Serving clients around the globe, Kelly provided employment to approximately 540,000 employees in 2013. Revenue in 2013 was $5.4 billion. Visit kellyservices.com and connect with us on Facebook, LinkedIn, & Twitter.

# # #


ANALYST CONTACT:	MEDIA CONTACT:


James Polehna	Jane Stehney


(248) 244-4586	(248) 244-5630


james_polehna@kellyservices.com	jane_stehney@kellyservices.com



KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE 13 WEEKS ENDED SEPTEMBER 28, 2014 AND SEPTEMBER 29, 2013
(UNAUDITED)
(In millions of dollars except per share data)
									%
		2014		2013		Change			Change

Revenue from services	$	1,396.4	$	1,345.6	$	50.8			3.8		%

Cost of services		1,171.0		1,125.2		45.8			4.1

Gross profit		225.4		220.4		5.0			2.2

Selling, general and administrative expenses		218.3		200.2		18.1			9.0

Earnings from operations		7.1		20.2		(13.1	)		(65.1	)

Other expense, net		2.2		1.3		0.9			(63.1	)

Earnings before taxes		4.9		18.9		(14.0	)		(74.4	)

Income tax expense		3.5		0.1		3.4			NM

Net earnings	$	1.4	$	18.8	$	(17.4	)		(93.0	)	%

Basic earnings per share	$	0.03	$	0.49	$	(0.46	)		(93.9	)	%
Diluted earnings per share	$	0.03	$	0.49	$	(0.46	)		(93.9	)	%


STATISTICS:

Gross profit rate		16.1	%	16.4	%	(0.3	)	pts.

Selling, general and administrative expenses:
% of revenue		15.6		14.9		0.7
% of gross profit		96.9		90.8		6.1

% Return:
Earnings from operations		0.5		1.5		(1.0	)
Earnings before taxes		0.3		1.4		(1.1	)
Net earnings		0.1		1.4		(1.3	)

Effective income tax rate		72.7	%	0.3	%	72.4		pts.

Average number of shares outstanding
(millions):
Basic		37.6		37.4
Diluted		37.6		37.4

Shares adjusted for nonvested restricted awards
(millions):
Basic		38.5		38.1
Diluted		38.5		38.1



KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE 39 WEEKS ENDED SEPTEMBER 28, 2014 AND SEPTEMBER 29, 2013
(UNAUDITED)
(In millions of dollars except per share data)
										%
		2014		2013			Change			Change

Revenue from services	$	4,137.7	$	4,027.3		$	110.4			2.7		%

Cost of services		3,461.9		3,369.3			92.6			2.8

Gross profit		675.8		658.0			17.8			2.7

Selling, general and administrative expenses		656.5		612.6			43.9			7.2

Asset impairments		—		1.7			(1.7	)		(100.0	)

Earnings from operations		19.3		43.7			(24.4	)		(56.4	)

Other expense, net		4.2		3.9			0.3			(4.6	)

Earnings before taxes		15.1		39.8			(24.7	)		(62.5	)

Income tax expense (benefit)		8.4		(1.9	)		10.3			NM

Net earnings	$	6.7	$	41.7		$	(35.0	)		(84.2	)	%

Basic earnings per share	$	0.17	$	1.09		$	(0.92	)		(84.4	)	%
Diluted earnings per share	$	0.17	$	1.09		$	(0.92	)		(84.4	)	%


STATISTICS:

Gross profit rate		16.3	%	16.3		%	—		pts.

Selling, general and administrative expenses:
% of revenue		15.9		15.2			0.7
% of gross profit		97.2		93.1			4.1

% Return:
Earnings from operations		0.5		1.1			(0.6	)
Earnings before taxes		0.4		1.0			(0.6	)
Net earnings		0.2		1.0			(0.8	)

Effective income tax rate		55.9	%	(5.0	)	%	60.9		pts.

Average number of shares outstanding
(millions):
Basic		37.5		37.2
Diluted		37.5		37.3

Shares adjusted for nonvested restricted awards
(millions):
Basic		38.5		38.2
Diluted		38.5		38.2



KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)

		Third Quarter
										Constant
										Currency
		2014			2013		Change			Change
AMERICAS
Commercial
Revenue from services	$	640.8		$	617.0		3.9		%	4.3		%
Staffing fee-based income included in revenue from services		3.8			3.3		12.3			12.7
Gross profit		91.7			86.8		5.7			6.1
Gross profit rate		14.3	%		14.1	%	0.2		pts.
PT
Revenue from services	$	242.5		$	239.9		1.1		%	1.2		%
Staffing fee-based income included in revenue from services		4.4			3.9		13.1			13.4
Gross profit		39.6			38.8		1.9			2.1
Gross profit rate		16.3	%		16.2	%	0.1		pts.
Total Americas
Revenue from services	$	883.3		$	856.9		3.1		%	3.4		%
Staffing fee-based income included in revenue from services		8.2			7.2		12.7			13.1
Gross profit		131.3			125.6		4.5			4.8
Total SG&A expenses		110.8			100.2		10.6			10.9
Earnings from operations		20.5			25.4		(19.7	)

Gross profit rate		14.9	%		14.7	%	0.2		pts.
Expense rates:
% of revenue		12.5			11.7		0.8
% of gross profit		84.5			79.8		4.7
Return on sales		2.3			3.0		(0.7	)

EMEA
Commercial
Revenue from services	$	231.3		$	224.5		3.0		%	3.2		%
Staffing fee-based income included in revenue from services		4.2			4.6		(8.9	)		(6.1	)
Gross profit		33.6			33.9		(0.9	)		(0.4	)
Gross profit rate		14.5	%		15.1	%	(0.6	)	pts.
PT
Revenue from services	$	48.1		$	45.1		6.5		%	6.0		%
Staffing fee-based income included in revenue from services		3.5			3.9		(9.6	)		(7.8	)
Gross profit		10.9			10.8		0.6			1.0
Gross profit rate		22.6	%		23.9	%	(1.3	)	pts.
Total EMEA
Revenue from services	$	279.4		$	269.6		3.6		%	3.6		%
Staffing fee-based income included in revenue from services		7.7			8.5		(9.3	)		(6.9	)
Gross profit		44.5			44.7		(0.5	)		(0.1	)
SG&A expenses excluding restructuring charges		40.0			40.0		—
Restructuring charges		—			0.3		(100.0	)
Total SG&A expenses		40.0			40.3		(0.8	)		(0.5	)
Earnings from operations		4.5			4.4		1.6
Earnings from operations excluding restructuring charges		4.5			4.7		(5.5	)

Gross profit rate		15.9	%		16.6	%	(0.7	)	pts.
Expense rates (excluding restructuring charges):
% of revenue		14.3			14.8		(0.5	)
% of gross profit		90.0			89.5		0.5
Return on sales (excluding restructuring charges)		1.6			1.7		(0.1	)



KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)

		Third Quarter
										Constant
										Currency
		2014			2013		Change			Change
APAC
Commercial
Revenue from services	$	91.0		$	87.6		3.9		%	2.2		%
Staffing fee-based income included in revenue from services		2.0			2.3		(15.5	)		(17.3	)
Gross profit		11.7			12.7		(8.2	)		(9.7	)
Gross profit rate		12.8	%		14.5	%	(1.7	)	pts.
PT
Revenue from services	$	10.6		$	9.1		15.8		%	14.4		%
Staffing fee-based income included in revenue from services		2.0			2.2		(9.9	)		(11.0	)
Gross profit		3.3			3.4		(2.8	)		(4.0	)
Gross profit rate		31.5	%		37.5	%	(6.0	)	pts.
Total APAC
Revenue from services	$	101.6		$	96.7		5.0		%	3.4		%
Staffing fee-based income included in revenue from services		4.0			4.5		(12.8	)		(14.2	)
Gross profit		15.0			16.1		(7.0	)		(8.5	)
SG&A expenses excluding restructuring charges		14.2			14.5		(2.5	)
Restructuring charges		0.3			0.1		410.5
Total SG&A expenses		14.5			14.6		(0.9	)		(2.7	)
Earnings from operations		0.5			1.5		(65.7	)
Earnings from operations excluding restructuring charges		0.8			1.6		(48.4	)

Gross profit rate		14.8	%		16.7	%	(1.9	)	pts.
Expense rates (excluding restructuring charges):
% of revenue		14.0			15.1		(1.1	)
% of gross profit		94.6			90.2		4.4
Return on sales (excluding restructuring charges)		0.8			1.6		(0.8	)

OCG
Revenue from services	$	149.8		$	135.3		10.7		%	10.9		%
Gross profit		35.8			34.8		2.9			2.8
SG&A expenses excluding restructuring charges		32.2			28.0		15.0
Restructuring charges		—			0.1		(100.0	)
Total SG&A expenses		32.2			28.1		14.7			14.7
Earnings from operations		3.6			6.7		(46.0	)
Earnings from operations excluding restructuring charges		3.6			6.8		(46.6	)

Gross profit rate		23.9	%		25.7	%	(1.8	)	pts.
Expense rates (excluding restructuring charges):
% of revenue		21.5			20.7		0.8
% of gross profit		89.8			80.3		9.5
Return on sales (excluding restructuring charges)		2.4			5.1		(2.7	)



KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)

		September Year to Date
										Constant
										Currency
		2014			2013		Change			Change
AMERICAS
Commercial
Revenue from services	$	1,915.1		$	1,904.1		0.6		%	1.4		%
Staffing fee-based income included in revenue from services		10.4			9.8		6.1			7.6
Gross profit		280.0			274.5		2.0			2.8
Gross profit rate		14.6	%		14.4	%	0.2		pts.
PT
Revenue from services	$	723.1		$	733.7		(1.4	)	%	(1.3	)	%
Staffing fee-based income included in revenue from services		11.7			10.8		8.6			9.1
Gross profit		118.4			116.1		2.0			2.2
Gross profit rate		16.4	%		15.8	%	0.6		pts.
Total Americas
Revenue from services	$	2,638.2		$	2,637.8		—		%	0.7		%
Staffing fee-based income included in revenue from services		22.1			20.6		7.4			8.4
Gross profit		398.4			390.6		2.0			2.6
Total SG&A expenses		332.9			310.6		7.2			7.9
Earnings from operations		65.5			80.0		(18.3	)

Gross profit rate		15.1	%		14.8	%	0.3		pts.
Expense rates:
% of revenue		12.6			11.8		0.8
% of gross profit		83.6			79.5		4.1
Return on sales		2.5			3.0		(0.5	)

EMEA
Commercial
Revenue from services	$	690.2		$	645.3		7.0		%	5.7		%
Staffing fee-based income included in revenue from services		14.0			14.9		(6.0	)		(4.3	)
Gross profit		101.0			98.8		2.2			1.2
Gross profit rate		14.6	%		15.3	%	(0.7	)	pts.
PT
Revenue from services	$	145.5		$	131.7		10.3		%	7.7		%
Staffing fee-based income included in revenue from services		10.7			11.7		(8.3	)		(7.6	)
Gross profit		33.3			32.0		3.8			2.3
Gross profit rate		22.8	%		24.3	%	(1.5	)	pts.
Total EMEA
Revenue from services	$	835.7		$	777.0		7.5		%	6.0		%
Staffing fee-based income included in revenue from services		24.7			26.6		(7.0	)		(5.7	)
Gross profit		134.3			130.8		2.6			1.5
SG&A expenses excluding restructuring charges		124.2			122.1		1.7
Restructuring charges		0.8			0.1		327.7
Total SG&A expenses		125.0			122.2		2.2			0.8
Earnings from operations		9.3			8.6		8.1
Earnings from operations excluding restructuring charges		10.1			8.7		15.1

Gross profit rate		16.1	%		16.8	%	(0.7	)	pts.
Expense rates (excluding restructuring charges):
% of revenue		14.9			15.7		(0.8	)
% of gross profit		92.5			93.3		(0.8	)
Return on sales (excluding restructuring charges)		1.2			1.1		0.1



KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)

		September Year to Date
										Constant
										Currency
		2014			2013		Change			Change
APAC
Commercial
Revenue from services	$	260.5		$	256.8		1.4		%	4.2		%
Staffing fee-based income included in revenue from services		5.9			7.0		(17.1	)		(14.0	)
Gross profit		35.7			36.8		(3.1	)		(0.3	)
Gross profit rate		13.7	%		14.3	%	(0.6	)	pts.
PT
Revenue from services	$	29.2		$	29.3		(0.5	)	%	3.3		%
Staffing fee-based income included in revenue from services		5.8			6.7		(13.0	)		(9.7	)
Gross profit		9.4			10.5		(10.2	)		(6.8	)
Gross profit rate		32.2	%		35.7	%	(3.5	)	pts.
Total APAC
Revenue from services	$	289.7		$	286.1		1.3		%	4.1		%
Staffing fee-based income included in revenue from services		11.7			13.7		(15.1	)		(11.9	)
Gross profit		45.1			47.3		(4.6	)		(1.7	)
SG&A expenses excluding restructuring charges		43.3			45.5		(4.7	)
Restructuring charges		1.3			0.3		373.4
Total SG&A expenses		44.6			45.8		(2.3	)		1.1
Earnings from operations		0.5			1.5		(76.8	)
Earnings from operations excluding restructuring charges		1.8			1.8		(4.2	)

Gross profit rate		15.6	%		16.5	%	(0.9	)	pts.
Expense rates (excluding restructuring charges):
% of revenue		15.0			15.9		(0.9	)
% of gross profit		96.2			96.2		—
Return on sales (excluding restructuring charges)		0.6			0.6		—

OCG
Revenue from services	$	422.1		$	361.0		16.9		%	17.3		%
Gross profit		101.3			91.7		10.5			10.6
SG&A expenses excluding restructuring charges		94.7			81.6		16.0
Restructuring charges		—			0.9		(100.0	)
Total SG&A expenses		94.7			82.5		14.9			15.0
Asset impairments		—			1.7		(100.0	)
Earnings from operations		6.6			7.5		(13.1	)
Earnings from operations excluding restructuring charges		6.6			8.4		(21.4	)

Gross profit rate		24.0	%		25.4	%	(1.4	)	pts.
Expense rates (excluding restructuring charges):
% of revenue		22.4			22.6		(0.2	)
% of gross profit		93.4			88.9		4.5
Return on sales (excluding restructuring charges)		1.6			2.4		(0.8	)



KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(In millions of dollars)

		Sept. 28, 2014			Dec. 29, 2013			Sept. 29, 2013
Current Assets
Cash and equivalents	$	51.6		$	125.7		$	73.9
Trade accounts receivable, less allowances of
$9.2, $9.9 and $10.0, respectively		1,158.1			1,023.1			1,071.8
Prepaid expenses and other current assets		56.8			52.2			62.0
Deferred taxes		28.9			35.5			40.3
Total current assets		1,295.4			1,236.5			1,248.0

Property and Equipment, Net		91.1			92.0			87.7

Noncurrent Deferred Taxes		132.7			121.7			104.5

Goodwill, Net		90.3			90.3			90.3

Other Assets		291.5			258.1			241.0

Total Assets	$	1,901.0		$	1,798.6		$	1,771.5

Current Liabilities
Short-term borrowings	$	88.7		$	28.3		$	58.0
Accounts payable and accrued liabilities		339.0			342.4			308.9
Accrued payroll and related taxes		318.6			294.9			300.9
Accrued insurance		24.4			27.6			30.7
Income and other taxes		74.0			68.8			71.5

Total current liabilities		844.7			762.0			770.0

Noncurrent Liabilities
Accrued insurance		43.4			46.0			40.7
Accrued retirement benefits		146.6			134.7			129.3
Other long-term liabilities		40.7			33.3			28.0

Total noncurrent liabilities		230.7			214.0			198.0

Stockholders' Equity
Common stock		40.1			40.1			40.1
Treasury stock		(52.5	)		(56.2	)		(57.5	)
Paid-in capital		26.7			26.0			26.1
Earnings invested in the business		752.3			751.3			736.0
Accumulated other comprehensive income		59.0			61.4			58.8

Total stockholders' equity		825.6			822.6			803.5

Total Liabilities and Stockholders' Equity	$	1,901.0		$	1,798.6		$	1,771.5


STATISTICS:
Working Capital	$	450.7		$	474.5		$	478.0
Current Ratio		1.5			1.6			1.6
Debt-to-capital %		9.7		%	3.3		%	6.7		%
Global Days Sales Outstanding		58			52			56



KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE 39 WEEKS ENDED SEPTEMBER 28, 2014 AND SEPTEMBER 29, 2013
(UNAUDITED)
(In millions of dollars)

		2014			2013
Cash flows from operating activities:
Net earnings	$	6.7		$	41.7
Noncash adjustments:
Impairment of assets		—			1.7
Depreciation and amortization		16.2			15.4
Provision for bad debts		3.6			1.1
Stock-based compensation		4.1			2.7
Other, net		1.3			0.7
Changes in operating assets and liabilities		(140.9	)		(41.4	)

Net cash (used in) from operating activities		(109.0	)		21.9

Cash flows from investing activities:
Capital expenditures		(15.0	)		(11.7	)
Investment in equity affiliate		(5.4	)		—
Other investing activities		0.2			—

Net cash used in investing activities		(20.2	)		(11.7	)

Cash flows from financing activities:
Net change in short-term borrowings		60.4			(6.1	)
Dividend payments		(5.7	)		(5.7	)
Other financing activities		0.4			0.3

Net cash from (used in) financing activities		55.1			(11.5	)

Effect of exchange rates on cash and equivalents		—			(1.1	)

Net change in cash and equivalents		(74.1	)		(2.4	)
Cash and equivalents at beginning of period		125.7			76.3


Cash and equivalents at end of period	$	51.6		$	73.9



KELLY SERVICES, INC. AND SUBSIDIARIES
REVENUE FROM SERVICES
(UNAUDITED)
(In millions of dollars)

		Third Quarter (Commercial, PT and OCG)
					% Change
								Constant
		2014		2013	US$			Currency

Americas
United States	$	873.7	$	843.5	3.6		%	3.6		%
Canada		51.9		52.9	(1.9	)		2.6
Mexico		37.0		33.1	11.8			13.6
Puerto Rico		25.7		24.4	5.1			5.1
Brazil		13.6		13.1	3.7			3.2
Total Americas		1,001.9		967.0	3.6			3.9

EMEA
France		70.1		62.4	12.4			12.0
Switzerland		66.7		68.6	(2.7	)		(4.7	)
Portugal		33.3		24.1	38.0			37.8
Russia		28.7		32.9	(13.0	)		(3.9	)
United Kingdom		26.2		26.5	(1.1	)		(8.4	)
Germany		17.5		17.4	0.6			0.6
Norway		14.8		16.1	(7.7	)		(3.8	)
Italy		14.8		13.8	6.7			6.7
Other		15.8		16.0	(1.0	)		(0.3	)
Total EMEA		287.9		277.8	3.6			3.7

APAC
Singapore		33.4		29.4	13.7			12.2
Australia		32.3		32.4	(0.2	)		(1.3	)
Malaysia		16.7		17.2	(3.0	)		(4.5	)
New Zealand		12.7		12.6	0.4			(5.1	)
Other		11.5		9.2	25.1			26.2
Total APAC		106.6		100.8	5.8			4.1

Total Kelly Services, Inc.	$	1,396.4	$	1,345.6	3.8		%	3.9		%



KELLY SERVICES, INC. AND SUBSIDIARIES
REVENUE FROM SERVICES
(UNAUDITED)
(In millions of dollars)

		September Year to Date (Commercial, PT and OCG)
					% Change
								Constant
		2014		2013	US$			Currency

Americas
United States	$	2,601.9	$	2,547.3	2.1		%	2.1		%
Canada		148.2		163.9	(9.6	)		(3.5	)
Mexico		102.3		99.4	2.9			6.4
Puerto Rico		78.4		73.6	6.4			6.4
Brazil		43.2		45.0	(4.1	)		5.2
Total Americas		2,974.0		2,929.2	1.5			2.1

EMEA
France		202.2		182.0	11.1			7.9
Switzerland		195.7		185.6	5.5			1.4
Russia		96.4		102.0	(5.5	)		5.9
Portugal		92.4		63.0	46.6			42.5
United Kingdom		82.4		78.1	5.5			(2.4	)
Germany		50.7		49.3	3.0			0.1
Italy		46.3		43.6	6.0			2.9
Norway		43.6		46.3	(5.7	)		(1.0	)
Other		50.9		50.7	0.4			(1.8	)
Total EMEA		860.6		800.6	7.5			6.0

APAC
Singapore		94.8		83.5	13.5			14.0
Australia		88.8		100.4	(11.6	)		(5.9	)
Malaysia		50.0		51.1	(2.1	)		1.5
New Zealand		38.2		36.1	5.9			2.1
Other		31.3		26.4	18.4			27.7
Total APAC		303.1		297.5	1.9			4.9

Total Kelly Services, Inc.	$	4,137.7	$	4,027.3	2.7		%	3.1		%



KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
FOR THE 13 WEEKS ENDED SEPTEMBER 28, 2014 AND SEPTEMBER 29, 2013
(UNAUDITED)
(In millions of dollars except per share data)

		2014							2013
		As reported		Restructuring Charges (Note 1)			Adjusted Earnings		Adjusted Earnings	% Change

Revenue from services	$	1,396.4	$	—		$	1,396.4	$	1,345.6	3.8		%

Cost of services		1,171.0		—			1,171.0		1,125.2	4.1

Gross profit		225.4		—			225.4		220.4	2.2

SG&A expenses		218.3		(4.0	)		214.3		199.7	7.3

Earnings from operations		7.1		4.0			11.1		20.7	(46.8	)

Other expense, net		2.2		—			2.2		1.3	(63.1	)

Earnings before taxes		4.9		4.0			8.9		19.4	(54.6	)

Inc. tax expense (benefit)		3.5		1.5			5.0		0.1	NM

Net earnings	$	1.4	$	2.5		$	3.9	$	19.3	(80.5	)	%

Earnings per share:
Basic	$	0.03	$	0.06		$	0.10	$	0.51	(80.4	)	%
Diluted	$	0.03	$	0.06		$	0.10	$	0.51	(80.4	)	%

		2013
		As reported		Restructuring Charges (Note 1)			Adjusted Earnings

Revenue from services	$	1,345.6	$	—		$	1,345.6

Cost of services		1,125.2		—			1,125.2

Gross profit		220.4		—			220.4

SG&A expenses		200.2		(0.5	)		199.7

Earnings from operations		20.2		0.5			20.7

Other expense, net		1.3		—			1.3

Earnings before taxes		18.9		0.5			19.4

Inc. tax expense (benefit)		0.1		—			0.1

Net earnings	$	18.8	$	0.5		$	19.3

Earnings per share:
Basic	$	0.49	$	0.01		$	0.51
Diluted	$	0.49	$	0.01		$	0.51

Note: Earnings per share amounts for each quarter are required to be computed independently and may not equal the amounts computed for the total year.



KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
FOR THE 39 WEEKS ENDED SEPTEMBER 28, 2014 AND SEPTEMBER 29, 2013
(UNAUDITED)
(In millions of dollars except per share data)

		2014									2013
		As reported			Restructuring Charges (Note 1)			Adjusted Earnings			Adjusted Earnings		% Change

Revenue from services	$	4,137.7		$	—		$	4,137.7		$	4,027.3		2.7		%

Cost of services		3,461.9			—			3,461.9			3,369.3		2.8

Gross profit		675.8			—			675.8			658.0		2.7

SG&A expenses		656.5			(5.8	)		650.7			611.3		6.5

Earnings from operations		19.3			5.8			25.1			46.7		(46.7	)

Other expense, net		4.2			—			4.2			3.9		(4.6	)

Earnings before taxes		15.1			5.8			20.9			42.8		(51.4	)

Inc. tax expense (benefit)		8.4			2.1			10.5			(1.8	)	NM

Net earnings	$	6.7		$	3.7		$	10.4		$	44.6		(77.0	)	%

Earnings per share:
Basic	$	0.17		$	0.10		$	0.27		$	1.17		(76.9	)	%
Diluted	$	0.17		$	0.10		$	0.27		$	1.17		(76.9	)	%

		2013
		As reported			Restructuring Charges (Note 1)			Asset Impairments (Note 2)			Adjusted Earnings

Revenue from services	$	4,027.3		$	—		$	—		$	4,027.3

Cost of services		3,369.3			—			—			3,369.3

Gross profit		658.0			—			—			658.0

SG&A expenses		612.6			(1.3	)		—			611.3

Asset impairments		1.7			—			(1.7	)		—

Earnings from operations		43.7			1.3			1.7			46.7

Other expense, net		3.9			—			—			3.9

Earnings before taxes		39.8			1.3			1.7			42.8

Inc. tax expense (benefit)		(1.9	)		0.1			—			(1.8	)

Net earnings	$	41.7		$	1.2		$	1.7		$	44.6

Earnings per share:
Basic	$	1.09		$	0.03		$	0.04		$	1.17
Diluted	$	1.09		$	0.03		$	0.04		$	1.17

Note: Earnings per share amounts for each quarter are required to be computed independently and may not equal the amounts computed for the total year.

KELLY SERIVCES, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP MEASURES

(UNAUDITED)

Management believes that the non-GAAP (Generally Accepted Accounting Principles) information excluding the restructuring charges and asset impairment charges is useful to understand the Company's fiscal 2014 financial performance and increases comparability. Specifically, Management believes that excluding these items allows for a more meaningful comparison of current period operating performance with the operating results of prior periods. These non-GAAP measures may have limitations as analytical tools because they exclude items which can have a material impact on cash flow and earnings per share. As a result, Management considers these measures, along with reported results, when it reviews and evaluates the Company's financial performance. Management believes that these measures provide greater transparency to investors and provide insight into how Management is evaluating the Company's financial performance. Non-GAAP measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.

(1) Restructuring charges in 2014 includes costs related to the U.S. management simplification restructuring plan, costs incurred for exiting the staffing business in Sweden, and costs related to closing branches in Australia and consolidating back office functions in Australia and New Zealand. Restructuring charges in 2013 relate to the Company's decision to exit the executive search business operating in Germany, and primarily relate to severance costs from exiting this business.

(2) Asset impairment charges represent the write-off of the carrying value of long-lived assets related to the decision to exit the executive search business operating in Germany.

KELLY SERVICES INC - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - November 5, 2014

Attached files

KELLY SERVICES INC Reports