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Dynamic quotes 
OFFON

MANPOWERGROUP INC.

(MAN)
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MANPOWERGROUP INC. Management's Discussion and Analysis of Financial Condition and Results of Operations (form 10-Q)

11/08/2021 | 05:04pm EST

See the financial measures section on pages 41-42 for further information on the Non-GAAP financial measures of constant currency and organic constant currency.

Forward-Looking Statements


This Quarterly Report on Form 10-Q contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Exchange Act of 1934, as amended, (each a "forward-looking
statement"). Statements made in this quarterly report that are not statements of
historical fact are forward-looking statements. In addition, from time to time,
we and our representatives may make statements that are forward-looking.
Forward-looking statements are based on management's current assumptions and
expectations and are subject to risks and uncertainties that are beyond our
control and may cause actual results to differ materially from those contained
in the forward-looking statements. Forward-looking statements can be identified
by words such as "expect," "anticipate," "intend," "plan," "may," "believe,"
"seek," "estimate," and other similar expressions. Important factors that could
cause our actual results to differ materially from those contained in the
forward-looking statements include, among others, the risk factors discussed in
Item 1A - Risk Factors in our annual report on Form 10-K for the year-ended
December 31, 2020, which information is incorporated herein by reference. Such
risks and uncertainties include, but are not limited to, the impacts of the
COVID-19 pandemic and related economic conditions and the Company's efforts to
respond to such impacts, including the possibility of additional lockdown
restrictions; changes in labor and tax legislation in places we do business;
failure to implement strategic technology investments; and other factors that
may be disclosed from time to time in our SEC filings or otherwise. We caution
that any forward-looking statement reflects only our belief at the time the
statement is made. We undertake no obligation to update any forward-looking
statements to reflect subsequent events or circumstances.

Business Overview


Our business is cyclical in nature and is sensitive to macroeconomic conditions
generally. Client demand for workforce solutions and services is dependent on
the overall strength of the labor market and secular trends toward greater
workforce flexibility within each of the segments where we operate. Improving
economic growth typically results in increasing demand for labor, resulting in
greater demand for our staffing services while demand for our outplacement
services typically declines. During periods of increased demand, as we
experienced in the third quarter of 2021, we are generally able to improve our
profitability and operating leverage as our cost base can support some increase
in business without a similar increase in selling and administrative expenses.
By contrast, during periods of decreased demand, our operating profit is
generally impacted unfavorably as we experience a deleveraging of selling and
administrative expenses, which may not decline at the same pace as revenues.

During the third quarter of 2021, we continued to see recovery in the majority
of our markets as we began to anniversary the COVID-19 related declines in our
results that occurred during the third quarter of 2020. Revenues increased 12.1%
during the third quarter of 2021 compared to the year-earlier period. Our third
quarter results reflect the continuing of the global economic recovery with
strong hiring demand from our clients due to vaccine rollouts in many countries
and the easing of pandemic-related restrictions in many countries resulting in
increased demand for our services in most of our key markets. However, we have
experienced some slowing in the rate of recovery, with some markets,
particularly in Europe, continuing to experience labor shortage and COVID-19
related challenges. These challenges impacted client demand for our services and
included supply chain issues and labor shortages as we believe certain parts of
the workforce did not return to the labor market in many industries and markets
over concerns about the COVID-19 Delta variant. Although, we experienced
strengthening demand across most geographies and industries during the quarter
compared to the prior year, uncertainty remains as to the future impact of the
pandemic on global and local economies.



                                       27

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In addition to the impact from COVID-19 discussed above, results for the quarter
were impacted by currency. During the third quarter of 2021, the United States
dollar was weaker, on average, relative to the currencies in our European
markets, which therefore had a favorable impact on our reported results and
generally may overstate the performance of our underlying business. The changes
in the foreign currency exchange rates had a 1.1% favorable impact on revenues
from services and an approximately $0.01 per share favorable impact on net
earnings per share - diluted in the quarter. Substantially all of our
subsidiaries derive revenues from services and incur expenses within the same
currency and generally do not have cross-currency transactions, and therefore,
changes in foreign currency exchange rates primarily impact reported earnings
and not our actual cash flow unless earnings are repatriated. To understand the
performance of our underlying business, we utilize constant currency or organic
constant currency variances for our consolidated and segment results.

During the third quarter of 2021, our businesses experienced declines in year-over-year revenue trends from the second quarter reflecting a slowing in the rate of recovery in a number of key markets. Our consolidated revenues increased 12.1% year-over-year in the quarter, a decline from the 41.0% year-over-year increase in the second quarter of 2021.


During the third quarter of 2021 compared to 2020, most of our markets
experienced revenue increases as the global recovery continued and as we
anniversaried the revenue declines due to the COVID-19 crisis. We experienced a
12.8% revenue increase in Southern Europe, mainly driven by the increased demand
in France and Italy. We experienced a 23.1% revenue increase in Northern Europe
primarily due to the increased demand for our staffing/interim services, mostly
in the United Kingdom and the Nordics. Revenues increased 7.4% in the Americas
driven primarily by the increase in demand for our staffing/interim services and
increased demand for our RPO and MSP offerings in the United States. We
experienced a 2.6% revenue increase in APME primarily due to the increase in our
Experis business.

From a brand perspective, we experienced revenue increases in all of our brands
during the third quarter of 2021 compared to 2020. The revenue increase in our
Manpower brand was primarily due to improved demand for our staffing services
and an increase in our permanent recruitment business. In our Experis brand, the
revenue increase was primarily due to the improved demand for our interim
services, an increase in our permanent recruitment business and increased demand
for our managed services, primarily in Southern Europe. On an overall basis, the
revenue increase in our Talent Solutions brand, which includes Recruitment
Process Outsourcing (RPO), TAPFIN - Managed Service Provider (MSP) and our Right
Management offerings, was driven mostly by increased demand for our RPO and MSP
services. As workplaces reopened across our geographies and workers returned in
phased approaches, we saw increased client demand for our HR skills within our
RPO business due to significant hiring activity. Our MSP business has remained
resilient during the pandemic and we experienced growth during the quarter as we
assisted more clients to develop customized workforce solutions.



                                       28

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Our gross profit margin improved in the third quarter of 2021 compared to 2020
primarily due to a favorable change in business mix as our higher-margin
permanent recruitment business, which experienced a 60.4% increase (58.9% in
constant currency and 61.4% in organic constant currency) during the quarter as
a result of stronger hiring activity, represented a higher percentage of the
revenues mix in our largest markets during the third quarter of 2021 compared to
the third quarter of 2020. The increase was also due to the improvement in our
Manpower staffing margins in the Americas and APME, margin improvement in our
Experis managed services business in Europe, and a higher percentage of revenue
mix coming from our higher-margin consulting and MSP services. These increases
were partially offset a lower mix of revenues coming from our higher-margin
Right Management career transition business, and lower favorable direct cost
adjustments.

We recorded transaction costs of $6.2 million in the third quarter of 2021
relating to our acquisition of ettain group, which closed in the fourth quarter
of 2021. We also recorded restructuring costs of $5.3 million in the third
quarter of 2021 in the Americas related to our Mexico operations as we
experienced a significant revenue decline in that market driven by new labor
legislation.

Our operating profit margin increased 144.4% in the third quarter of 2021 while
our operating profit margin increased 160 basis points compared to the third
quarter of 2020. Excluding acquisition transaction costs incurred in the third
quarter of 2021, restructuring costs incurred in the third quarter of 2021 and
2020, and a loss of $5.8 million from the disposition of subsidiaries incurred
in the third quarter of 2020, our operating profit was up 38.1% while operating
profit margin was up 60 basis points compared to the third quarter of 2020. The
operating profit margin increased due to the improvement in our gross profit
margin.

We continue to monitor expenses closely to ensure we maintain the benefit of our
efforts to optimize our organizational and cost structures, while investing
appropriately to support the ability of the business to grow in the future and
enhance our productivity, technology and digital capabilities. We are focused on
managing costs as efficiently as possible in the short-term while continuing to
progress transformational actions aligned with our strategic priorities.



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Operating Results - Three Months Ended September 30, 2021 and 2020

The following table presents selected consolidated financial data for the three months ended September 30, 2021 as compared to 2020.



                                                                                        Constant
                                                                                        Currency
(in millions, except per share data)         2021          2020         Variance        Variance
Revenues from services                     $ 5,140.6     $ 4,584.8           12.1 %          11.0 %
Cost of services                             4,287.6       3,859.7           11.1 %          10.0 %
Gross profit                                   853.0         725.1           17.6 %          16.8 %
Gross profit margin                             16.6 %        15.8 %
Selling and administrative expenses            702.5         663.5            5.9 %           5.0 %
Operating profit (loss)                        150.5          61.6          144.4 %         143.7 %
Operating profit (loss) margin                   2.9 %         1.3 %
Interest and other expenses, net                 4.9           6.0          (17.9 )%
Earnings (loss) before income taxes            145.6          55.6          161.8 %         160.8 %
Provision for income taxes                      47.9          45.3            5.6 %
Effective income tax rate                       32.9 %        81.5 %
Net earnings (loss)                        $    97.7     $    10.3          848.9 %         845.3 %
Net earnings (loss) per share - diluted    $    1.77     $    0.18          883.3 %         877.8 %
Weighted average shares - diluted               55.2          58.5           (5.6 )%



The year-over-year increase in revenues from services of 12.1% (11.0% in constant currency and 11.3% in organic constant currency) was attributed to:

a revenue increase in Southern Europe of 12.8% (11.7% in constant currency).
France, the largest market in Southern Europe, experienced a revenue increase of
9.3% (8.3% in constant currency), which was primarily due to the increased
demand for our Manpower staffing services, a 27.1% increase (25.9% in constant
currency) in the permanent recruitment business and the favorable impact of
changes in currency exchange rates. Italy, also part of Southern Europe,
experienced a revenue increase of 30.0% (28.8% in constant currency), which was
primarily due to the increased demand for our Manpower staffing services, an
83.8% increase (81.8% in constant currency) in the permanent recruitment
business and the favorable impact of changes in currency exchange rates;
•
a revenue increase in Northern Europe of 23.1% (19.2% in constant currency),
primarily due to the increased demand for our staffing/interim services, a 67.6%
increase (62.4% in constant currency) in the permanent recruitment business and
the favorable impact of changes in currency exchange rates. We experienced
revenue increases in the United Kingdom, the Nordics, Germany, the Netherlands
and Belgium of 34.5%, 22.6%, 12.6%, 5.6% and 11.9%, respectively (26.1%, 18.9%,
11.7%, 4.7% and 11.1%, respectively, in constant currency);
•
a revenue increase in the United States of 11.4% (10.6% on an organic basis)
primarily driven by increased demand for our staffing/interim services, an
increase in our permanent recruitment business of 89.4% (89.1% on an organic
basis), including our RPO offering, and increased demand for our MSP offering;
•
a revenue increase in APME of 2.6% (4.0% in constant currency) primarily due to
the increase in our Experis business, the 24.5% increase (23.6% in constant
currency) in the permanent recruitment business and the favorable impact of
changes in currency exchange rates; and
•
a 1.1% increase due to the impact of changes in currency exchange rates in our
European markets.





                                       30
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The year-over-year 80 basis point increase in gross profit margin was primarily attributed to:

a 80 basis point favorable change in business mix as the higher-margin permanent
recruitment business represented a higher percentage of the revenue mix;
•
a 20 basis point favorable impact from the improvement in the Manpower staffing
margins in the Americas and APME;
•
a 10 basis point favorable impact from the margin improvement in our Experis
managed services business in Europe; and
•
a 10 basis point favorable change in business mix as our higher-margin
consulting and MSP services represented a higher percentage of the revenue mix;
partially offset by
•
a 30 basis point unfavorable change in business mix as the higher-margin Right
Management career transition business represented a lower percentage of the
revenue mix; and
•
a 10 basis point unfavorable impact from the decrease in favorable direct cost
accrual adjustments as the favorable direct cost adjustments in Other Americas
in the third quarter of 2021 were less than the favorable adjustments in France
in the third quarter of 2020.

The 5.9% increase in selling and administrative expenses in the third quarter of 2021 (5.0% in constant currency; 6.0% in organic constant currency) was primarily attributed to:

a 16.8% increase (15.9% in constant currency and 16.0% in organic constant
currency) in personnel costs due to the increase in salary costs related to
additional headcount as we invested in incremental recruiters and sales talent
based on increased market activity. The increase in salary costs was also due to
an increase in variable incentive costs as a result of increased profitability
in most markets and the decrease in benefits related to the transition of
full-time equivalent employees onto government temporary unemployment programs
that occurred in the third quarter of 2020;
•
a 7.1% increase (6.2% in constant currency and 6.6% in organic constant
currency) in non-personnel related costs, excluding acquisition transaction
costs incurred in the third quarter of 2021, restructuring costs incurred in
both the third quarter of 2021 and 2020 and the loss on disposition of
subsidiaries incurred in the third quarter of 2020, to support the increase in
revenues;
•
a decrease in restructuring costs to $5.3 million incurred in the third quarter
of 2021 from $49.9 million in the third quarter of 2020;
•
a loss on disposition of subsidiaries of $5.8 million incurred in the third
quarter of 2020; and
•
a 0.9% increase due to the impact of changes in currency exchange rates in our
European markets; partially offset by
•
the $6.2 million of acquisition transaction costs incurred in the third quarter
of 2021.

Selling and administrative expenses as a percent of revenues decreased 80 basis
points in the third quarter of 2021 compared to the third quarter of 2020 due
primarily to:

a 100 basis point favorable impact as a result of the decrease in restructuring
costs;
•
a 20 basis point favorable impact as we were able to support an increase in
revenues without a similar increase in non-personnel related costs, excluding
acquisition transaction costs, restructuring costs and loss on disposition of
subsidiaries; and
•
a 10 basis point favorable impact from the loss on disposition of subsidiaries
incurred in the third quarter of 2020; partially offset by
•
a 40 basis point unfavorable impact as salary costs increased, due to the
investment in incremental recruiters and sales talent based on increased market
activity, without a similar increase in revenues; and

                                       31

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a 10 basis point unfavorable impact from the acquisition transaction costs incurred in the third quarter of 2021.


Interest and other expenses, net is comprised of interest, foreign exchange
gains and losses and other miscellaneous non-operating income and expenses,
including noncontrolling interests. Interest and other expenses, net was $4.9
million in the third quarter of 2021 compared to $6.0 million in the third
quarter of 2020. Miscellaneous income increased to $3.2 million in the third
quarter of 2021 from $2.3 million in the third quarter of 2020 primarily due to
the increase in income from our equity investment in ManpowerGroup Greater China
Limited.

We recorded income tax expense at an effective rate of 32.9% for the third
quarter of 2021, as compared to an effective rate of 81.5% for the third quarter
of 2020. The 2020 rate was unfavorably impacted by the relatively low level and
mix of pre-tax earnings and a discrete valuation allowance in Germany. The 2021
rate was favorably impacted by the scheduled reduction in the French corporate
tax rate to 27.5%, the enacted 50% reduction in the French business tax rate,
and a higher level of pre-tax earnings. The 32.9% effective tax rate for the
three months ended September 30, 2021 was higher than the United States Federal
statutory rate of 21% primarily due to the French business tax, tax losses in
certain countries for which we did not recognize a corresponding tax benefit due
to valuation allowances, and the overall mix of earnings. The COVID-19 crisis is
creating uncertainty around predicting future earnings, and that uncertainty
could make it more difficult for us to accurately estimate tax rates into the
future.

Net earnings per share - diluted was $1.77 in the third quarter of 2021 compared
to $0.18 in the third quarter of 2020. Foreign currency exchange rates favorably
impacted net earnings per share - diluted by approximately $0.01 per share in
the third quarter of 2021. Restructuring costs recorded in the third quarter of
2021 and 2020 negatively impacted net earnings per share - diluted by
approximately $0.07 and $0.72, net of tax, in the third quarter of 2021 and
2020, respectively. The acquisition transaction costs in the third quarter of
2021 negatively impacted net earnings per share - diluted by approximately
$0.09, net of tax, in the third quarter of 2021. The loss from the disposition
of subsidiaries in the third quarter of 2020 negatively impacted net earnings
per share - diluted by approximately $0.09, net of tax, in the third quarter of
2020.

Weighted average shares - diluted decreased to 55.2 million in the third quarter
of 2021 from 58.5 million in the third quarter of 2020. This decrease was due to
the impact of share repurchases completed since the third quarter of 2020,
partially offset by shares issued as a result of exercises and vesting of
share-based awards since the third quarter of 2020.

Operating Results - Nine Months Ended September 30, 2021 and 2020

The following table presents selected consolidated financial data for the nine months ended September 30, 2021 to 2020.



                                                                                        Constant
                                                                                        Currency
(in millions, except per share data)          2021           2020        Variance       Variance
Revenues from services                     $ 15,342.1     $ 12,946.1          18.5 %         13.2 %
Cost of services                             12,860.9       10,920.3          17.8 %         12.4 %
Gross profit                                  2,481.2        2,025.8          22.5 %         17.5 %
Gross profit margin                              16.2 %         15.6 %
Selling and administrative expenses,
excluding goodwill impairment charge          2,062.4        1,909.7           8.0 %          3.7 %
Goodwill impairment charge                          -           66.8           N/A            N/A
Selling and administrative expenses           2,062.4        1,976.5           4.3 %          0.2 %
Operating profit (loss)                         418.8           49.3         749.8 %        712.9 %
Operating profit (loss) margin                    2.7 %          0.4 %
Interest and other expenses, net                 13.1           32.3         (59.2 )%
Earnings (loss) before income taxes             405.7           17.0        2281.0 %       2182.2 %
Provision for income taxes                      134.4           69.4          93.5 %
Effective income tax rate                        33.1 %        407.4 %
Net earnings (loss)                        $    271.3     $    (52.4 )         N/A            N/A

Net earnings (loss) per share - diluted $ 4.90 $ (0.90 )

    N/A            N/A
Weighted average shares - diluted                55.4           58.4          (5.1 )%




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The year-over-year increase in revenues from services of 18.5% (13.2% in constant currency and 13.5% in organic constant currency) was attributed to:

a revenue increase in Southern Europe of 26.0% (18.8% in constant currency).
France, the largest market in Southern Europe, experienced a revenue increase of
26.9% (19.4% in constant currency), which was primarily due to the increased
demand for our Manpower staffing services, a 35.2% increase (26.9% in constant
currency) in the permanent recruitment business and the favorable impact of
changes in currency exchange rates. Italy, also part of Southern Europe,
experienced a revenue increase of 40.2% (31.9% in constant currency), which was
primarily due to the increased demand for our Manpower staffing services, a
71.9% increase (61.5% in constant currency) in the permanent recruitment
business, the favorable impact of approximately one additional billing day and
the favorable impact of changes in currency exchange rates;
•
a revenue increase in Northern Europe of 21.1% (12.4% in constant currency),
primarily due to the increased demand for our Manpower staffing services, the
40.2% increase (30.2% in constant currency) in the permanent recruitment
business and the favorable impact of changes in currency exchange rates,
partially offset by the unfavorable impact of approximately one fewer billing
day. We experienced revenue increases in the United Kingdom, the Nordics,
Germany, the Netherlands and Belgium of 29.7%, 22.8%, 6.3%, 9.7% and 11.9%,
respectively (18.9%, 11.1%, flat, 3.1% and 5.4%, respectively, in constant
currency);
•
a revenue increase in the United States of 10.4% (9.7% on an organic basis)
primarily driven by increased demand for our Manpower staffing services, an
increase in our permanent recruitment business of 62.9% (62.7% on an organic
basis), including our RPO offering, and increased demand for our MSP offering;
•
a revenue increase in APME of 5.6% (3.3% in constant currency) primarily due to
the increase in our Experis business, the 17.5% increase (9.7% in constant
currency) in the permanent recruitment business and the favorable impact of
changes in currency exchange rates; and
•
a 5.3% increase due to the impact of changes in currency exchange rates in
markets within Europe and APME.



The year-over-year 60 basis point increase in gross profit margin was primarily attributed to:

a 20 basis point favorable impact from the improvement in the staffing/interim
margins in the Americas, Southern Europe and APME;
•
a 40 basis point favorable change in business mix as the higher-margin permanent
recruitment business represented a higher percentage of the revenue mix;
•
a 10 basis point favorable impact from the margin improvement in our Experis
managed services business in Europe; and
•
a 10 basis point favorable change in business mix as our higher-margin
consulting and MSP services represented a higher percentage of the revenue mix;
partially offset by
•
a 20 basis point unfavorable change in business mix as the higher-margin Right
Management career transition business represented a lower percentage of the
revenue mix.



                                       33
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The 4.3% increase in selling and administrative expenses in the nine months ended September 30, 2021 (0.2% in constant currency; 0.6% in organic constant currency) was primarily attributed to:

an 18.0% increase (13.4% in constant currency and 13.5% in organic constant
currency) in personnel costs due to the increase in salary costs related to
additional headcount as we invested in incremental recruiters and sales talent
based on increased market activity. The increase in salary costs was also due to
an increase in variable incentive costs as a result of increased profitability
in most markets and the decrease in benefits related to the transition of
full-time equivalent employees onto government temporary unemployment programs
that occurred in the nine months ended September 30, 2020;
•
a 5.8% increase (1.3% in constant currency and 1.7% in organic constant
currency) in non-personnel related costs, excluding acquisition transaction
costs, restructuring costs, goodwill and other impairment charges and loss on
disposition of subsidiaries, primarily driven by the negative impact of changes
in currency exchange rates and to support the increase in revenues;
•
the $6.2 million of acquisition transaction costs incurred in the nine months
ended September 30, 2021; and
•
a 4.1% increase due to the impact of changes in currency exchange rates in
markets within Europe and APME; partially offset by
•
a decrease in restructuring costs to $5.3 million incurred in the nine months
ended September 30, 2021 from $98.1 million in the nine months ended September
30, 2020;
•
the goodwill and other impairment charges of $72.8 million incurred in the nine
months ended September 30, 2020; and
•
the $5.8 million loss on the disposition of subsidiaries incurred in the nine
months ended September 30, 2020.

Selling and administrative expenses as a percent of revenues decreased 190 basis
points in the nine months ended September 30, 2021 compared to the nine months
ended September 30, 2020 due primarily to:

a 60 basis point favorable impact as a result of the decrease in goodwill and
other impairment charges;
•
a 70 basis point favorable impact as a result of the decrease in restructuring
costs in the nine months ended September 30, 2020 compared to the nine months
ended September 30, 2021;
•
a 50 basis point favorable impact as we were able to support an increase in
revenues without a similar increase in non-personnel related costs, excluding
acquisition transaction costs, restructuring costs, goodwill and other
impairment charges and loss on disposition of subsidiaries; and
•
a 10 basis point favorable impact from changes in currency exchange rates.

Interest and other expenses, net was $13.1 million in the nine months ended
September 30, 2021 compared to $32.3 million in the nine months ended September
30, 2020. Miscellaneous income was $11.8 million in the nine months ended
September 30, 2021 compared to miscellaneous expense of $5.7 million in the nine
months ended September 30, 2020. The change is primarily due to the pension
settlement expenses of $10.2 million recorded in the nine months ended September
30, 2020 related to the settlement of our United States qualified retirement
plan liability and the increase in income from our equity investment in
ManpowerGroup Greater China Limited.

We recorded income tax expense at an effective rate of 33.1% for the nine months
ended September 30, 2021, as compared to an effective rate of 407.4% for the
nine months ended September 30, 2020. The 2020 rate was unfavorably impacted by
the relatively low level and mix of pre-tax earnings, the non-deductible
goodwill impairment charge in Germany, and a discrete valuation allowance in
Germany. The 2021 rate was favorably impacted by the scheduled reduction in the
French corporate tax rate to 27.5%, the enacted 50% reduction in the French
business tax rate, and a higher level of pre-tax earnings. The 33.1% effective
tax rate for the nine months ended September 30, 2021 was higher than the United
States Federal statutory rate of 21% primarily due to the French business tax,

                                       34

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tax losses in certain countries for which we did not recognize a corresponding tax benefit due to valuation allowances, and the overall mix of earnings.


Net earnings (loss) per share - diluted was earnings of $4.90 in the nine months
ended September 30, 2021 compared to a loss of $0.90 in the nine months ended
September 30, 2020. Foreign currency exchange rates favorably impacted net
earnings per share - diluted by approximately $0.21 per share in the nine months
ended September 30, 2021. Restructuring costs recorded in the nine months ended
September 30, 2021 and 2020 negatively impacted net earnings (loss) per share -
diluted by approximately $0.07 and $1.40 per share, net of tax, in the nine
months ended September 30, 2021and 2020, respectively. The acquisition
transaction costs in the nine months ended September 30, 2021 negatively
impacted net earnings per share - diluted by approximately $0.09, net of tax, in
the nine months ended September 30, 2021. Goodwill and other impairment charges
recorded in the nine months ended September 30, 2020 negatively impacted net
loss per share - diluted by approximately $1.14 in the nine months ended
September 30, 2020. The pension settlement expense recorded in the nine months
ended September 30, 2020 negatively impacted net loss per share - diluted by
approximately $0.11, net of tax, in the nine months ended September 30, 2020.
The loss from the disposition of subsidiaries in the nine months ended September
30, 2020 negatively impacted net loss per share - diluted by approximately
$0.09, net of tax, in the nine months ended September 30, 2020.

Weighted average shares - diluted decreased to 55.4 million in the nine months
ended September 30, 2021 from 58.4 million in the nine months ended September
30, 2020. This decrease was due to the impact of share repurchases completed
since the nine months ended September 30, 2020 and the full weighting of the
repurchases completed in the nine months ended September 30, 2020, partially
offset by shares issued as a result of exercises and vesting of share-based
awards since the nine months ended September 30, 2020.

Segment Operating Results

Americas


In the Americas, revenues from services increased 7.4% (7.7% in constant
currency and 7.2% in organic constant currency) in the third quarter of 2021
compared to the third quarter of 2020. In the United States, revenues from
services increased 11.4% (10.6% on an organic basis) in the third quarter of
2021 compared to the third quarter of 2020, primarily driven by increased demand
for our staffing/interim services, an increase in our permanent recruitment
business of 89.4% (89.1% on an organic basis), including our RPO offering, and
increased demand for our MSP offering. In Other Americas, revenues from services
increased 0.7% (1.7% in constant currency) in the third quarter of 2021 compared
to the third quarter of 2020 primarily due to increased demand for our Experis
interim services, an increase in our permanent recruitment business of 141.6%
(149.6% in constant currency), partially offset by the decreased demand for our
Manpower staffing services and the unfavorable impact of one fewer billing day.
This improvement was driven by increases in Canada, Argentina, Colombia, Peru
and Brazil of 21.3%, 27.3%, 40.5%, 13.6% and 1.5%, respectively (14.8%, 69.0%,
44.7%, 29.7% and a decrease of 1.3%, respectively, in constant currency), with
the increase in Argentina being primarily due to inflation. The increases were
partially offset by a decrease in Mexico of 40.6% (-46.3% in constant currency)
primarily due to the new labor legislation, implemented during the third
quarter, that prohibits the provision of traditional temporary staffing
services, only allowing outsourced worker assignments for specialized services
outside of the client's core business activity. Although we believe the new
labor legislation will result in significant revenue reductions in Mexico over
the next few quarters, we believe the mix shift towards more specialized
staffing will improve the margins of our Mexico business over time. Our Mexico
operations generated approximately 2.8% of our consolidated global revenues for
the year ended December 31, 2020.



                                       35

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In the Americas, revenues from services increased 9.7% (9.9% in constant
currency and 9.4% in organic constant currency) in the nine months ended
September 30, 2021 compared to the nine months ended September 30, 2020. In the
United States, revenues from services increased 10.4% (9.7% on an organic basis)
in the nine months ended September 30, 2021 compared to the nine months ended
September 30, 2020, primarily driven by increased demand for our Manpower
staffing services, an increase in our permanent recruitment business of 62.9%
(62.7% on an organic basis), including our RPO offering, and increased demand
for our MSP offering, partially offset by the unfavorable impact of one fewer
billing day. In Other Americas, revenues from services increased 8.5% (9.0% in
constant currency) in the nine months ended September 30, 2021 compared to the
nine months ended September 30, 2020 primarily due to increased demand for our
staffing/interim services, an increase in our permanent recruitment business of
90.9% (96.2% in constant currency), partially offset by the unfavorable impact
of two fewer billing days. This improvement was driven by increases in Canada,
Argentina, Colombia, Peru and Brazil of 21.7%, 33.8%, 14.6%, 7.2% and 11.4%,
respectively (12.4%, 85.5%, 14.7%, 18.9% and 19.1%, respectively, in constant
currency), with the increase in Argentina being primarily due to inflation. The
increases were partially offset by a decrease in Mexico of 8.3% (-14.4% in
constant currency) primarily due to the new labor legislation.

Gross profit margin increased in both the third quarter and the nine months
ended September 30, 2021 compared to the third quarter and the nine months ended
September 30, 2020 primarily due to the improvements in the staffing/interim
margins, partly due to favorable direct cost adjustments incurred in the third
quarter of 2021 and nine months ended September 30, 2021 in a market within
Other Americas. The increases were also due to the increases in our permanent
recruitment business, and increases in revenues from our higher-margin MSP and
RPO offerings in the United States. These increases were partially offset by the
unfavorable changes in business mix as the higher-margin Right Management career
transition business represented a lower percentage of the revenue mix.

In the third quarter of 2021, selling and administrative expenses increased
12.3% (12.1% in constant currency and 11.8% in organic constant currency),
primarily due to the increase in salary-related costs as a result of a higher
headcount as we invested in incremental recruiters and sales talent based on
increased market activity. The increase in salary-related costs was also due to
an increase in variable incentive costs as a result of increased profitability
in certain markets . The increase was also due to acquisition transaction costs
of $6.2 million incurred in the third quarter of 2021 and an increase in
consulting costs related to certain technology initiatives. The increases were
partially offset by the decrease in restructuring costs to $5.3 million in the
third quarter of 2021 compared to $16.7 million in the third quarter of 2020. In
the nine months ended September 30, 2021, selling and administrative expenses
increased 3.2% (3.3% in constant currency and 3.0% in organic constant
currency), primarily due to the increase in salary-related costs due to higher
headcount to support an increase in revenues in the quarter and an increase in
variable incentive costs as a result of an increase in profitability in certain
markets. The increase was also due to acquisition transaction costs of $6.2
million incurred in the nine months ended September 30, 2021 and an increase in
consulting costs related to certain technology initiatives. The increases were
partially offset by the decrease in restructuring costs to $5.3 million in the
nine months ended September 30, 2021 compared to $29.5 million in the nine
months ended September 30, 2020, the decrease in software impairment charges and
a decline in office-related expenses driven by a decrease in the number of
offices.

Operating Unit Profit ("OUP") margin in the Americas was 4.1% and 3.4% for the
third quarter of 2021 and 2020, respectively. In the United States, OUP margin
increased to 4.4% in the third quarter of 2021 from 3.3% in the third quarter of
2020 primarily due to our ability to increase revenues without a similar
increase in expenses, an increase in the gross profit margin and the decrease in
restructuring costs, partially offset by the acquisition transaction costs
incurred in the third quarter of 2021. Other Americas OUP margin increased to
3.6% in the third quarter of 2021 from 3.5% in the third quarter of 2020
primarily due to the gross profit margin improvement, partially offset by an
increase in restructuring costs.

Operating Unit Profit ("OUP") margin in the Americas was 4.6% and 2.4% for the
nine months ended September 30, 2021 and 2020, respectively. In the United
States, OUP margin increased to 5.1% in the nine months ended September 30, 2021
from 1.8% in the nine months ended September 30, 2020 primarily due to decrease
in restructuring costs, the decrease in software impairment charges, our ability
to increase revenues without a similar increase in expenses, and an increase in
the gross profit margin. The increase was partially offset by the acquisition
transaction costs incurred in the nine months ended September 30, 2021. Other
Americas OUP margin increased to 3.9% in the nine months ended September 30,
2021 from 3.5% in the nine months ended September 30, 2020 primarily due to the
gross profit margin improvement, partially offset by an increase in
restructuring costs.



                                       36
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Southern Europe


In Southern Europe, which includes operations in France and Italy, revenues from
services increased 12.8% (11.7% in constant currency) in the third quarter of
2021 compared to the third quarter of 2020. In the third quarter of 2021,
revenues from services increased 9.3% (8.3% in constant currency) in France
(which represents 55% of Southern Europe's revenues) and increased 30.0% (28.8%
in constant currency) in Italy (which represents 19% of Southern Europe's
revenues). The increase in France is primarily due to the increased demand for
our Manpower staffing services, although supply chain constraints impacted the
demand for our services from our automotive clients and the COVID-19 Delta
variant slowed the rate of recovery, a 27.1% increase (25.9% in constant
currency) in the permanent recruitment business and the favorable impact of
changes in currency exchange rates. The increase in Italy was primarily due to
the increased demand for our Manpower staffing services, an 83.8% increase
(81.8% in constant currency) in the permanent recruitment business and the
favorable impact of changes in currency exchange rates. In Other Southern
Europe, revenues from services increased 9.6% (8.1% in constant currency and
10.8% in organic constant currency) during the third quarter of 2021 compared to
the third quarter of 2020, due to increased demand for our Manpower staffing
services and an increase in our permanent recruitment business of 58.8% (56.2%
in constant currency and 67.6% in organic constant currency), partially offset
by the disposition of subsidiaries in Other Southern Europe in the third quarter
of 2020.

Revenues from services increased 26.0% (18.8% in constant currency) in the nine
months ended September 30, 2021 compared to the nine months ended September 30,
2020. In the nine months ended September 30, 2021, revenues from services
increased 26.9% (19.4% in constant currency) in France and increased 40.2%
(31.9% in constant currency) in Italy. The increase in France is primarily due
to the increased demand for our Manpower staffing services, a 35.2% increase
(26.9% in constant currency) in the permanent recruitment business and the
favorable impact of changes in currency exchange rates. The increase in Italy
was primarily due to the increased demand for our Manpower staffing services, a
71.9% increase (61.5% in constant currency) in the permanent recruitment
business, the favorable impact of approximately one additional billing day and
the favorable impact of changes in currency exchange rates. In Other Southern
Europe, revenues from services increased 15.5% (9.3% in constant currency and
12.4% in organic constant currency) during the nine months ended September 30,
2021 compared to the nine months ended September 30, 2020, due to increased
demand for our Manpower staffing services and an increase in our permanent
recruitment business of 29.0% (22.7% in constant currency and 29.9% in organic
constant currency), partially offset by the disposition of subsidiaries in Other
Southern Europe in the nine months ended September 30, 2020.

Gross profit margin increased in the third quarter and the nine months ended
September 30, 2021 compared to the third quarter and the nine months ended
September 30, 2020. The increases were primarily due to the increases of 51.9%
and 41.7%, respectively, (50.1% and 33.6%, respectively, in constant currency)
in the permanent recruitment business. The increase in the third quarter of 2021
compared to 2020 was partially offset by the decrease in the Manpower staffing
margin as lower margin enterprise clients represented a larger percentage of
revenues during the third quarter of 2021 compared to 2020.



                                       37

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Selling and administrative expenses increased 2.4% (1.4% in constant currency)
during the third quarter of 2021 compared to the third quarter of 2020 primarily
due to the increase in salary-related costs due to higher headcount to support
an increase in revenues in the quarter, an increase in variable incentive costs
as a result of increased profitability in certain markets, and the decrease in
benefits related to the transition of full-time equivalent employees onto
government temporary unemployment programs that occurred in the third quarter of
2020. The increase is also due to the higher non-personnel related costs to
support the growth in revenues and the unfavorable impact of changes in currency
exchange rates. The increases were partially offset by the decrease in
restructuring costs to zero in the third quarter of 2021 from $7.6 million in
the third quarter of 2020 and the loss on disposition of subsidiaries of $5.8
million incurred in the third quarter of 2020. Selling and administrative
expenses increased 10.7% (4.3% in constant currency) during the nine months
ended September 30, 2021 compared to the nine months ended September 30, 2020
primarily due to the increase in salary-related costs due to higher headcount to
support an increase in revenues in the quarter, an increase in variable
incentive costs as a result of increased profitability in certain markets, and
the decrease in benefits related to the transition of full-time equivalent
employees onto government temporary unemployment programs that occurred in the
nine months ended September 30, 2020. The increase was also due to the
unfavorable impact of changes in currency exchange rates. These increases were
partially offset by the decrease in restructuring costs to zero in the nine
months ended September 30, 2021 from $20.7 million in the nine months ended
September 30, 2020.

OUP margin in Southern Europe was 4.6% for the third quarter of 2021 compared to
3.4% for the third quarter of 2020. In France, the OUP margin was 4.7% for the
third quarter of 2021 compared to 4.3% for the third quarter of 2020. The
increase in France was primarily due to our ability to increase revenues without
a similar increase in expenses and the increase in the gross profit margin. In
Italy, the OUP margin increased to 6.7% for the third quarter of 2021 from 4.4%
for the third quarter of 2020 primarily due to our ability to increase revenues
without a similar increase in expenses, the increase in the gross profit margin
and the decrease of restructuring costs to zero in the third quarter of 2021
compared to $1.8 million in the third quarter of 2020. Other Southern Europe's
OUP margin increased to 3.0% in the third quarter of 2021 from 0.9% in the third
quarter of 2020, primarily due to the increase in the gross profit margin and
the decrease of restructuring costs to zero in the third quarter of 2021
compared to $5.8 million in the third quarter of 2020.

OUP margin in Southern Europe was 4.3% for the nine months ended September 30,
2021 compared to 2.5% for the nine months ended September 30, 2020. In France,
the OUP margin increased to 4.4% for the nine months ended September 30, 2021
from 2.9% in the nine months ended September 30, 2020 primarily due to our
ability to increase revenues without a similar increase in expenses and the
increase in the gross profit margin. In Italy, the OUP margin increased to 6.2%
for the nine months ended September 30, 2021 from 4.3% for the nine months ended
September 30, 2020 primarily due to the decrease in restructuring costs to zero
in the nine months ended September 30, 2021 from $1.8 million in the nine months
ended September 30, 2020, our ability to increase revenues without a similar
increase in expenses and the increase in the gross profit margin. Other Southern
Europe's OUP margin increased to 2.7% in the nine months ended September 30,
2021 from 0.6% in the nine months ended September 30, 2020, primarily due to the
decrease in restructuring costs to zero in the nine months ended September 30,
2021 from $17.3 million in the nine months ended September 30, 2020, our ability
to increase revenues without a similar increase in expenses, the increase in the
gross profit margin and the loss on disposition of subsidiaries incurred in the
nine months ended September 30, 2020.

Northern Europe


In Northern Europe, which includes operations in the United Kingdom, the
Nordics, Germany, the Netherlands and Belgium (comprising 37%, 21%, 14%, 10%,
and 7%, respectively, of Northern Europe's revenues), revenues from services
increased 23.1% (19.2% in constant currency) in the third quarter of 2021
compared to the third quarter of 2020. We experienced revenue increases in the
United Kingdom, the Nordics, Germany, the Netherlands and Belgium of 34.5%,
22.6%, 12.6%, 5.6% and 11.9%, respectively (26.1%, 18.9%, 11.7%, 4.7% and 11.1%,
respectively, in constant currency). The revenue increase in Northern Europe was
primarily due to the increased demand for our staffing/interim services, the
67.6% increase (62.4% in constant currency) in the permanent recruitment
business and the favorable impact of changes in currency exchange rates.



                                       38

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In Northern Europe, revenues from services increased 21.1% (12.4% in constant
currency) in the nine months ended September 30, 2021 compared to the nine
months ended September 30, 2020. We experienced revenue increases in the United
Kingdom, the Nordics, Germany, the Netherlands and Belgium of 29.7%, 22.8%,
6.3%, 9.7% and 11.9%, respectively (18.9%, 11.1%, flat, 3.1% and 5.4%,
respectively, in constant currency). The revenue increase in Northern Europe was
primarily due to the increased demand for our Manpower staffing services, the
40.2% increase (30.2% in constant currency) in the permanent recruitment
business and the favorable impact of changes in currency exchange rates,
partially offset by the unfavorable impact of approximately one fewer billing
day.

Gross profit margin increased in the third quarter and the nine months ended
September 30, 2021 compared to the third quarter and the nine months ended
September 30, 2020 due to the increases in our permanent recruitment business,
partially offset by the declines in the Manpower staffing margin due to client
mix changes, as a higher percentage of revenues consisted of revenues from our
lower-margin enterprise clients.

Selling and administrative expenses increased 1.2% (decrease of -1.4% in
constant currency) in the third quarter of 2021 compared to the third quarter of
2020. Selling and administrative expenses increased 5.8% (decrease of -1.7% in
constant currency) in the nine months ended September 30, 2021 compared to the
nine months ended September 30, 2020. The increases are primarily due to the
increases in salary-related costs due to higher headcount to support increases
in revenues and increases in variable incentive costs as a result of increases
in profitability in certain markets. The increases were also due to the
increases in non-personnel related costs to support the increases in revenues,
and the decrease in benefits related to the transition of full-time equivalent
employees onto government temporary unemployment programs that occurred in 2020.
The increases were partially offset by the decreases in restructuring costs to
zero in both the third quarter of 2021 and nine months ended September 30, 2021
from $24.1 million and $43.5 million in the third quarter of 2020 and nine
months ended September 30, 2020, respectively.

OUP margin for Northern Europe increased to 1.4% in the third quarter of 2021
from an operating unit loss of 2.4% in the third quarter of 2020. OUP margin for
Northern Europe was 1.1% in the nine months ended September 30, 2021 compared to
an operating unit loss margin of 1.3% in the nine months ended September 30,
2020.The increases were primarily due to our ability to increase revenues
without a similar increase in expenses, increases in the gross profit margin and
the decreases in restructuring costs.

APME


Revenues from services increased 2.6% (4.0% in constant currency) in the third
quarter of 2021 compared to the third quarter of 2020. In Japan (which
represents 48% of APME's revenues), revenues from services increased 9.1% (13.2%
in constant currency) due to the increase in our Experis business, increased
demand for our Manpower staffing services and the 38.8% increase (44.0% in
constant currency) in our permanent recruitment business. In Australia (which
represents 12% of APME's revenues), revenues from services decreased 27.4%
(29.3% in constant currency) due to the decreased demand for our Manpower
staffing services, partially offset by the 11.9% increase (8.9% in constant
currency) in our permanent recruitment business. The revenue increase in the
remaining markets in APME is due to the increase in demand for our Talent-Based
Outsourcing services within our Manpower business, the 65.9% increase (66.1% in
constant currency) in our permanent recruitment business, partially offset by
the unfavorable impact of approximately one fewer billing day.

Revenues from services increased 5.6% (3.3% in constant currency) in the nine
months ended September 30, 2021 compared to the nine months ended September 30,
2020. In Japan, revenues from services increased 9.5% (10.6% in constant
currency) due to the increase in our Experis business, increased demand for our
Manpower staffing services, the 17.0% increase (18.5% in constant currency) in
our permanent recruitment business and the favorable impact of approximately two
additional billing days. In Australia, revenues from services decreased 5.7%
(-16.7% in constant currency) due to the decreased demand for our Manpower
staffing services and the unfavorable impact of approximately six fewer billing
days, partially offset by the 12.1% increase (0.3% in constant currency) in our
permanent recruitment business and the favorable impact of changes in currency
exchange rates. The revenue increase in the remaining markets in APME is due to
the increase in demand for our Talent-Based Outsourcing services within our
Manpower business, the 46.1% increase (42.9% in constant currency) in our
permanent recruitment business and the favorable impact of changes in currency
exchange rates, partially offset by the unfavorable impact of approximately one
fewer billing day.

                                       39
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Gross profit margin increased in the third quarter and nine months ended September 30, 2021 compared to the third quarter and the nine months ended September 30, 2020 primarily due to the increases in our staffing/interim margins and the increases of 24.5% and 17.5%, respectively, (23.6% and 9.7% in constant currency, respectively) in our permanent recruitment business.


Selling and administrative expenses increased 8.8% (9.6% in constant currency)
in the third quarter of 2021 compared to the third quarter of 2020. Selling and
administrative expenses increased 11.0% (7.2% in constant currency) in the nine
months ended September 30, 2021 compared to the nine months ended September 30,
2020. The increases are primarily due to the increases in salary-related costs
due to higher headcount to support an increase in revenues and increases in
variable incentive costs as a result of increases in profitability in certain
markets, and the increases in non-personnel related costs to support the
increases in revenues. The increase for the nine months ended September 30, 2021
compared to the nine months ended September 30, 2020 was also due to the
unfavorable impact of changes in currency exchange rates. The increases were
partially offset by the decreases in restructuring costs to zero in both the
third quarter of 2021 and nine months ended September 30, 2021 from $1.5 million
and $4.1 million in the third quarter of 2020 and nine months ended September
30, 2020, respectively.

OUP margin for APME increased to 3.7% in the third quarter of 2021 from 2.8% in
the third quarter of 2020. OUP margin for APME increased to 3.4% in the nine
months ended September 30, 2021 from 2.9% in the nine months ended September 30,
2020. The increases are due to the improvements in the gross profit margins,
partially offset by the decreases in restructuring costs.

Financial Measures

Constant Currency and Organic Constant Currency Reconciliation


Changes in our financial results include the impact of changes in foreign
currency exchange rates, acquisitions, and dispositions. We provide "constant
currency" and "organic constant currency" calculations in this report to remove
the impact of these items. We express year-over-year variances that are
calculated in constant currency and organic constant currency as a percentage.

When we use the term "constant currency," it means that we have translated
financial data for a period into United States dollars using the same foreign
currency exchange rates that we used to translate financial data for the
previous period. We believe that this calculation is a useful measure,
indicating the actual growth or decline of our operations. We use constant
currency results in our analysis of subsidiary or segment performance. We also
use constant currency when analyzing our performance against that of our
competitors. Substantially all of our subsidiaries derive revenues and incur
expenses within a single country and, consequently, do not generally incur
currency risks in connection with the conduct of their normal business
operations. Changes in foreign currency exchange rates primarily impact reported
earnings and not our actual cash flow unless earnings are repatriated.

When we use the term "organic constant currency," it means that we have further
removed the impact of acquisitions in the current period and dispositions from
the prior period from our constant currency calculation. We believe that this
calculation is useful because it allows us to show the actual growth or decline
of our ongoing business.

The constant currency and organic constant currency financial measures are used
to supplement those measures that are in accordance with United States Generally
Accepted Accounting Principles ("GAAP"). These Non-GAAP financial measures may
not provide information that is directly comparable to that provided by other
companies in our industry, as other companies may calculate such financial
results differently. These Non-GAAP financial measures are not measurements of
financial performance under GAAP, and should not be considered as alternatives
to measures presented in accordance with GAAP.

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Constant currency and organic constant currency percent variances, along with a
reconciliation of these amounts to certain of our reported results, are provided
below:



                                             Three Months Ended September 30, 2021 Compared to 2020
                                                                                            Impact of
                                                                                           Acquisitions          Organic
                                                                          Constant       and Dispositions        Constant
                        Reported          Reported       Impact of        Currency         (In Constant          Currency
                        Amount(a)         Variance       Currency         Variance          Currency)            Variance
Revenues from
services:
Americas:
United States                644.9             11.4 %             -            11.4 %                  0.8 %          10.6 %
Other Americas               352.7              0.7 %          (1.0 )%          1.7 %                    -             1.7 %
                             997.6              7.4 %          (0.3 )%          7.7 %                  0.5 %           7.2 %
Southern Europe:
France                     1,317.0              9.3 %           1.0 %           8.3 %                    -             8.3 %
Italy                        456.4             30.0 %           1.2 %          28.8 %                    -            28.8 %
Other Southern
Europe                       609.2              9.6 %           1.5 %           8.1 %                 (2.7 )%         10.8 %
                           2,382.6             12.8 %           1.1 %          11.7 %                 (0.7 )%         12.4 %
Northern Europe            1,166.6             23.1 %           3.9 %          19.2 %                    -            19.2 %
APME                         611.2              2.6 %          (1.4 )%          4.0 %                    -             4.0 %
                           5,158.0
Intercompany
Eliminations                 (17.4 )
Consolidated               5,140.6             12.1 %           1.1 %          11.0 %                 (0.3 )%         11.3 %
Gross Profit                 853.0             17.6 %           0.8 %          16.8 %                 (0.1 )%         16.9 %
Selling and
Administrative
Expenses                     702.5              5.9 %           0.9 %           5.0 %                 (1.0 )%          6.0 %
Operating Profit             150.5            144.4 %           0.7 %         143.7 %                 18.8 %         124.9 %




(a)

In millions for the three months ended September 30, 2021.




                                              Nine Months Ended September 30, 2021 Compared to 2020
                                                                                             Impact of
                                                                                            Acquisitions          Organic
                                                                           Constant       and Dispositions        Constant
                         Reported          Reported       Impact of        Currency         (In Constant          Currency
                        Amount(a)          Variance       Currency         Variance          Currency)            Variance
Revenues from
services:
Americas:
United States          $    1,882.5             10.4 %             -            10.4 %                  0.7 %           9.7 %
Other Americas              1,162.3              8.5 %          (0.5 )%          9.0 %                    -             9.0 %
                            3,044.8              9.7 %          (0.2 )%          9.9 %                  0.5 %           9.4 %
Southern Europe:
France                      3,852.7             26.9 %           7.5 %          19.4 %                    -            19.4 %
Italy                       1,328.3             40.2 %           8.3 %          31.9 %                    -            31.9 %
Other Southern
Europe                      1,784.3             15.5 %           6.2 %           9.3 %                 (3.1 )%         12.4 %
                            6,965.3             26.0 %           7.2 %          18.8 %                 (0.9 )%         19.7 %
Northern Europe             3,490.9             21.1 %           8.7 %          12.4 %                    -            12.4 %
APME                        1,858.5              5.6 %           2.3 %           3.3 %                    -             3.3 %
                           15,359.5
Intercompany
Eliminations                  (17.4 )
Consolidated           $   15,342.1             18.5 %           5.3 %          13.2 %                 (0.3 )%         13.5 %
Gross Profit           $    2,481.2             22.5 %           5.0 %          17.5 %                 (0.2 )%         17.7 %
Selling and
Administrative
Expenses               $    2,062.4              4.3 %           4.1 %           0.2 %                 (0.4 )%          0.6 %
Operating Profit       $      418.8            749.8 %          36.9 %         712.9 %                 77.9 %         635.0 %



(a) In millions for the nine months ended September 30, 2021.

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Liquidity and Capital Resources


Cash used to fund our operations is primarily generated through operating
activities and provided by our existing credit facilities. We believe our
available cash and existing credit facilities are sufficient to cover our cash
needs for the foreseeable future. We assess and monitor our liquidity and
capital resources globally. We use a global cash pooling arrangement,
intercompany lending, and some local credit lines to meet funding needs and
allocate our capital resources among our various entities. As of September 30,
2021, we had $722.7 million of cash held by foreign subsidiaries. We have
historically made and anticipate future cash repatriations to the United States
from certain foreign subsidiaries to fund domestic operations. With the
enactment of the United States Tax Cuts and Jobs Act in December 2017, we no
longer record United States federal income taxes on unremitted earnings of
non-United States subsidiaries. However, we do record deferred tax liabilities
related to non-United States withholding and other taxes on unremitted earnings
that are not considered permanently invested.

Cash provided by operating activities was $382.9 million and $715.7 million
during the nine months ended September 30, 2021 and 2020, respectively. Changes
in operating assets and liabilities generated $40.8 million of cash during the
nine months ended September 30, 2021 compared to $577.1 million during the nine
months ended September 30, 2020. These changes were primarily attributable to an
increase in accounts receivable due to the stronger market environment as the
impact of the COVID-19 crisis has stabilized in many parts of the world, and an
increase in accounts payable due to timing. Accounts receivable increased to
$5,091.4 million as of September 30, 2021 from $4,912.4 million as of December
31, 2020. This increase was partially offset by the impact of changes in
currency exchange rates. Days Sales Outstanding ("DSO") increased to
approximately 58 as of September 30, 2021 from approximately 54 as of December
31, 2020 due to unfavorable mix changes, with higher growth in countries with a
higher average DSO.

The nature of our operations is such that our most significant current asset is
accounts receivable and our most significant current liabilities are payroll
related costs, which are generally paid either weekly or monthly. As the demand
for our services increases, as we saw during the nine months ended September 30,
2021, we generally see an increase in our working capital needs, as we continue
to pay our associates on a weekly or monthly basis while the related accounts
receivable is outstanding for much longer, which may result in a decline in
operating cash flows.

Conversely, as the demand for our services declines, we generally see a decrease
in our working capital needs, as the existing accounts receivable are collected
and not replaced at the same level, resulting in a decline of our accounts
receivable balance, with less of an effect on current liabilities due to the
shorter cycle time of the payroll related items. This may result in an increase
in our operating cash flows; however, any such increase would not be expected to
be sustained in the event that an economic downturn continued for an extended
period.

Capital expenditures were $39.7 million for the nine months ended September 30,
2021 compared to $30.5 million for the nine months ended September 30, 2020.
These expenditures were primarily comprised of purchases of computer equipment,
office furniture and other costs related to office openings and refurbishments,
as well as capitalized software costs. The higher expenditures in 2021 compared
to 2020 are primarily due to additional technology investments and the timing of
capital expenditures.

From time to time, we acquire and invest in companies throughout the world,
including franchises. For the nine months ended September 30, 2021, the total
cash consideration paid for acquisitions, net of cash acquired, was $13.3
million, which mainly related to franchise acquisitions in the United States and
a contingent consideration payment associated with a previous acquisition.



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On October 1, 2021, we acquired ettain group, one of the largest privately held
IT resourcing and services providers in North America. Effective that date,
ettain group became part of our Experis business in the Americas segment. The
aggregate cash consideration paid was $930.9 million. Of the total consideration
paid, $925.0 million was for the acquired interests and the remaining $5.9
million was for excess working capital and cash. The transaction was funded
through cash on hand and a $150.0 million draw on our revolving credit facility
on October 1, 2021. We expect to finalize the net working capital adjustments in
the fourth quarter of 2021.

The acquisition of ettain group will be accounted for as a business combination
and the assets and liabilities of ettain group will be included in the
Consolidated Balance Sheets as of the acquisition date, and its performance will
be included in the Consolidated Statements of Operations subsequent to the
acquisition date. The major classes of assets and liabilities of ettain group
are expected to be cash and cash equivalents, accounts receivable, current and
long-term liabilities, deferred taxes, and goodwill and other amortizable
intangible assets.

Net debt repayments were $1.7 million and $28.7 million in the nine months ended September 30, 2021 and 2020, respectively.


Our €500.0 million notes and €400.0 million notes are due June 2026 and
September 2022, respectively. We reclassified the €400.0 million notes to
current during the third quarter of 2021 as they are due within the next 12
months. When the notes mature, we plan to repay the amounts with available cash,
borrowings under our $600.0 million revolving credit facility or a new
borrowing. The credit terms, including interest rate and facility fees, of any
replacement borrowings will be dependent upon the condition of the credit
markets at that time. We currently do not anticipate any problems accessing the
credit markets should we decide to replace either the €500.0 million or €400.0
million notes.

As of September 30, 2021, we had letters of credit totaling $0.5 million issued
under our $600.0 million revolving credit facility. Additional borrowings of
$599.5 million were available to us under the facility as of September 30, 2021.
Although our revolving credit facility for $600.0 million remained unused as of
September 30, 2021, we drew $150.0 million as of October 1, 2021 in conjunction
with the funding of the ettain group acquisition. We intend to repay this
balance over the next 12 months.

The $600.0 million revolving credit agreement requires that we comply with a
leverage ratio (Net Debt-to-Net Earnings before interest and other expenses,
provision for income taxes, intangible asset amortization expense, depreciation
and amortization expense ("EBITDA")) of not greater than 3.5 to 1 and a fixed
charge coverage ratio of not less than 1.5 to 1. As defined in the agreement, we
had a Net Debt-to-EBITDA ratio of -0.2 to 1 and a fixed charge coverage ratio of
4.8 to 1 as of September 30, 2021. Based on our current forecast, we expect to
be in compliance with our financial covenants for the next 12 months.

In addition to the previously mentioned facilities, we maintain separate bank
credit lines with financial institutions to meet working capital needs of our
subsidiary operations. As of September 30, 2021, such uncommitted credit lines
totaled $344.2 million, of which $317.2 was unused. Under the Credit Agreement,
total subsidiary borrowings cannot exceed $300.0 million in the first, second
and fourth quarters, and $600.0 million in the third quarter of each year.

We have assessed what impact the COVID-19 crisis has had or may have on our
liquidity position as of September 30, 2021 and for the near future. As of
September 30, 2021, our cash and cash equivalents balance was $1,612.6 million.
We also have access to the previously mentioned revolving credit facility that
could have immediately provided us with up to $600.0 million of additional cash
as of September 30, 2021, and we have an option to request an increase to the
total availability under the revolving credit facility by an additional $200.0
million and each lender may participate in the requested increase at their
discretion. In addition, we have access to uncommitted credit lines of up to
$344.2 million to meet the working capital needs of our subsidiaries, of which
$317.2 million was available to use as of September 30, 2021. In the third
quarter, we can borrow up to $600 million under these credit lines but we are
limited to $300 million in other quarters. Our €500.0 million notes and €400.0
million notes that total $1,038.4 million as of September 30, 2021 mature in
2026 and 2022, thus, there are no payments due in the very near term except for
annual interest payments. Based on the above, notwithstanding the cash used to
fund the ettain group acquisition on October 1, 2021, we believe we have
sufficient liquidity and capital resources to satisfy future requirements and
meet our obligations currently and in the near future should the COVID-19 crisis
cause any additional cash flow needs.

                                       43

--------------------------------------------------------------------------------


The Board of Directors declared a semi-annual dividend of $1.26 and $1.09 per
share, respectively, on May 7, 2021 and May 8, 2020. The 2021 dividends were
paid on June 15, 2021 to shareholders of record as of June 1, 2021. The 2020
dividends were paid on June 15, 2020 to shareholders of record as of June 1,
2020.

In August 2021, the Board of Directors authorized the repurchase of 4.0 million
shares of our common stock, with terms consistent with the previous
authorizations. This authorization was in addition to the August 2019 and 2018
Board authorizations to purchase 6.0 million shares of our common stock each.
Share repurchases may be made from time to time through a variety of methods,
including open market purchases, block transactions, privately negotiated
transactions or similar facilities. During the nine months ended September 30,
2021, we repurchased a total of 1.5 million shares under the 2019 authorization
at a cost of $150.1 million. During the nine months ended September 30, 2020, we
repurchased a total of 0.9 million shares comprised of 0.8 million shares under
the 2018 authorization and 0.1 million shares under the 2019 authorization, at a
total cost of $63.8 million. The 2021 repurchases all occurred within the first
half of 2021, and the 2020 repurchases all occurred within the first quarter of
2020. As of September 30, 2021, there were 4.0 million and 1.9 million shares
remaining authorized for repurchase under the 2021 authorization and 2019
authorization, respectively, and no shares remaining authorized for repurchase
under the 2018 authorization.

We had aggregate commitments of $2,081.4 million as of September 30, 2021 related to debt, operating leases, severances and office closure costs, transition tax resulting from the Tax Act and certain other commitments compared to $2,197.6 million as of December 31, 2020.


We also have entered into guarantee contracts and stand-by letters of credit
totaling $845.9 million and $890.0 million as of September 30, 2021 and December
31, 2020, respectively ($794.3 million and $838.4 million for guarantees,
respectively, and $51.6 million for stand-by letters of credit as of both
dates). The guarantees primarily relate to staffing license requirements,
operating leases and indebtedness. The stand-by letters of credit mainly relate
to workers' compensation in the United States. If certain conditions were met
under these arrangements, we would be required to satisfy our obligations in
cash. Due to the nature of these arrangements and our historical experience, we
do not expect any significant payments under these arrangements. Therefore, they
have been excluded from our aggregate commitments. The cost of these guarantees
and letters of credit was $1.4 million for both the nine months ended September
30, 2021 and 2020.

We recorded net restructuring costs of $5.3 and $98.1 during the nine months
ended September 30, 2021 and 2020, respectively, in selling and administrative
expenses, primarily related to severances and office closures and consolidations
in multiple countries and territories. The costs paid or utilized out of our
restructuring reserve were $32.5 million during the nine months ended September
30, 2021. We expect a majority of the remaining $18.9 million reserve will be
paid by the end of 2021.



                                       44
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Application of Critical Accounting Policies


In accordance with the accounting guidance for goodwill, we perform an annual
impairment test of goodwill at our reporting unit level during the third
quarter, or more frequently if events or circumstances change that would more
likely than not reduce the fair value of our reporting units below carrying
value.

Estimated cash flows and goodwill are grouped at the reporting unit level, which
the company has determined to be a component of the operating segments for which
discrete financial information is available and for which segment management
regularly reviews the reporting results.

We evaluate the recoverability of goodwill utilizing an income approach that
estimates the fair value of the future discounted cash flows to which the
goodwill relates. This approach reflects management's internal outlook of the
reporting units, which is believed to be the best determination of value due to
management's insight and experience with the reporting units. Significant
assumptions used in our goodwill impairment test during the third quarter of
2021 included: expected future revenue growth rates, operating unit profit
margins, working capital levels, discount rates, and a terminal value multiple.
The expected future revenue growth rates and operating unit profit margins were
determined after taking into consideration our historical revenue growth rates
and operating unit profit margins, our assessment of future market potential,
and our expectations of future business performance.

We believe that the future discounted cash flow valuation model provides the
most reasonable and meaningful fair value estimate based on the reporting units'
projections of future operating results and cash flows and is consistent with
our view of how market participants would value the company's reporting units in
an orderly transaction.

In the event the fair value of a reporting unit is less than the carrying value,
including goodwill, we would record an impairment charge based on the excess of
a reporting units' carrying amount over its fair value.

We performed our annual impairment test of our goodwill during the third quarter
of 2021 and there was no impairment of our goodwill as a result of our annual
tests. Refer to Note 1 for results of our annual goodwill impairment testing.

Recently Issued Accounting Standards

See Note 2 to the Consolidated Financial Statements.

© Edgar Online, source Glimpses

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