Research News and Market Data on KELYA
- Following the sale of European staffing operations, Q3 revenue down 7.1% year-over-year; nearly flat on an organic basis
- Q3 operating earnings of $2.6 million; $11.7 million on an adjusted basis, down 24.5%
- Q3 adjusted EBITDA margin increased 20 basis points to 2.5%
- Company expects sale of European staffing operations, acquisition of Motion Recruitment Partners, LLC (“MRP”), ongoing transformation actions to contribute to continued year-over-year EBITDA margin expansion in Q4 2024
TROY, Mich., Nov. 07, 2024 (GLOBE NEWSWIRE) — Kelly (Nasdaq: KELYA, KELYB), a leading specialty talent solutions provider, today announced results for the third quarter of 2024.
Peter Quigley, president and chief executive officer, announced revenue for the third quarter of 2024 totaled $1.04 billion, a 7.1% decrease compared to the corresponding quarter of 2023 resulting primarily from the sale of the company’s European staffing operations on January 2, 2024, partially offset by the May 2024 acquisition of MRP. Excluding the impact of the sale of the European staffing operations and the recent acquisition of MRP, revenue was down 0.2% on an organic basis, reflecting a stabilization of year-over-year revenues for the second consecutive quarter despite the continued impact of customers’ more guarded approach to hiring, initiating new projects, and backfilling open roles. MRP revenue added 11.2% to reported Q3 year-over-year revenue growth.
Kelly reported operating earnings in the third quarter of 2024 of $2.6 million, compared to earnings of $0.1 million reported in the third quarter of 2023. Adjusted earnings were $11.7 million in the third quarter of 2024. The $9.1 million increase from reported earnings includes costs related to MRP integration and further aligning processes and technology across the Company, as well as charges related to the acquisition of MRP and the sale of our European staffing operations. The acquisition of MRP added $2.0 million of earnings from operations in the third quarter of 2024. Adjusted earnings in the third quarter of 2023 were $15.5 million. The $15.4 million increase from reported earnings included transformation-related charges. The European staffing operations produced $0.8 million of earnings from operations on an adjusted basis in the third quarter of 2023.
Earnings per share in the third quarter of 2024 were $0.02 compared to earnings per share of $0.18 in the third quarter of 2023. Included in earnings per share in the third quarter of 2024 are costs related to MRP integration and further aligning processes and technology across the Company as well as charges related to the acquisition of MRP and the sale of our European staffing operations, net of tax, of $0.18. Included in the earnings per share in the third quarter of 2023 were $0.32 per share of transformation-related restructuring charges, net of tax. On an adjusted basis, earnings per share were $0.21 in the third quarter of 2024 compared to $0.50 per share in the corresponding quarter of 2023.
“In the third quarter, we remained focused on what we can control as uncertain macroeconomic market conditions persisted, and once again delivered stable year-over-year organic revenue that outpaced the market,” said Quigley. “Contributing to this trend is continued double-digit revenue growth in Education, our ongoing expansion into the market for higher-margin outcome-based solutions in SETT and P&I, and sequential stability in MSP and RPO revenue in OCG. We expect to build on our momentum as we close the year, propelled by our growth and efficiency initiatives which are positioning Kelly to capitalize when staffing demand rebounds and continue delivering above-market performance.”
Kelly also reported that on November 5, its board of directors declared a dividend of $0.075 per share. The dividend is payable on December 4, 2024, to stockholders of record as of the close of business on November 20, 2024.
In conjunction with its third-quarter earnings release, Kelly has published a financial presentation on the Investor Relations page of its public website and will host a conference call at 9 a.m. ET on November 7 to review the results and answer questions. The call may be accessed in one of the following ways:
Via the Internet:
Kellyservices.com
Via the telephone
(877) 692-8955 (toll free) or (234) 720-6979 (caller paid)
Enter access code 5728672
After the prompt, please enter “#”
A recording of the conference call will be available after 1:30 p.m. ET on November 7, 2024, at (866) 207-1041 (toll-free) and (402) 970-0847 (caller-paid). The access code is 9480328#. The recording will also be available at kellyservices.com during this period.
This release contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about Kelly’s financial expectations, are forward-looking statements. Factors that could cause actual results to differ materially from those contained in this release include, but are not limited to, (i) changing market and economic conditions, (ii) disruption in the labor market and weakened demand for human capital resulting from technological advances, loss of large corporate customers and government contractor requirements, (iii) the impact of laws and regulations (including federal, state and international tax laws), (iv) unexpected changes in claim trends on workers’ compensation, unemployment, disability and medical benefit plans, (v) litigation and other legal liabilities (including tax liabilities) in excess of our estimates, (vi) our ability to achieve our business’s anticipated growth strategies, (vii) our future business development, results of operations and financial condition, (viii) damage to our brands, (ix) dependency on third parties for the execution of critical functions, (x) conducting business in foreign countries, including foreign currency fluctuations, (xi) availability of temporary workers with appropriate skills required by customers, (xii) cyberattacks or other breaches of network or information technology security, and (xiii) other risks, uncertainties and factors discussed in this release and in the Company’s filings with the Securities and Exchange Commission. In some cases, forward-looking statements can be identified by words or phrases such as “may,” “will,” “expect,” “anticipate,” “target,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. All information provided in this press release is as of the date of this press release and we undertake no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company’s expectations.
About Kelly®
Kelly Services, Inc. (Nasdaq: KELYA, KELYB) helps companies recruit and manage skilled workers and helps job seekers find great work. Since inventing the staffing industry in 1946, we have become experts in the many industries and local and global markets we serve. With a network of suppliers and partners around the world, we connect more than 500,000 people with work every year. Our suite of outsourcing and consulting services ensures companies have the people they need, when and where they are needed most. Headquartered in Troy, Michigan, we empower businesses and individuals to access limitless opportunities in industries such as science, engineering, technology, education, manufacturing, retail, finance, and energy. Revenue in 2023 was $4.8 billion. Learn more at kellyservices.com.
KLYA-FIN
| ANALYST & MEDIA CONTACT: | |||
| Scott Thomas | |||
| (248) 251-7264 | |||
| scott.thomas@kellyservices.com |