The effects of the Covid-19 crisis moderated in the first quarter but continued to impact customer demand and supply of talent at Kelly (NASDAQ: KELYA). First-quarter revenue fell 5.5% year over year in constant currency at the Troy, Michigan-based staffing giant.
“We’re seeing strong demand across all of our operating segments,” Kelly President and CEO Peter Quigley said. “This translated into sustained, sequential revenue improvements in our education; OCG; international; and science, engineering and technology business segments.”
| (US$ millions) | Q1 2021 | Q1 2020 | % change | % constant currency |
| Revenue | $1,205.9 | $1,261.1 | -4.4% | -5.5% |
| Gross profit | $213.3 | $223.3 | -4.5% | -5.7% |
| Gross margin | 17.7% | 17.7% | ||
| Net earnings | $25.6 | ($153.2) | nm |
The company noted the first quarter of 2020 had a goodwill impairment charge of $147.7 million and a restructuring charge of $8.7 million. They were partially offset by a $32.1 million gain on sale of assets.
Revenue by segment
| (US$ millions) | Q1 2021 | Q1 2020 | % change | % constant currency |
| Professional & industrial | $467.6 | $493.8 | -5.3% | -5.6% |
| Science, engineering and technology | $254.7 | $270.2 | -5.7% | -5.9% |
| Education | $111.6 | $142.5 | -21.7% | -21.7% |
| Outsourcing & consulting | $99.3 | $89.5 | 11.0% | 9.5% |
| International | $272.9 | $265.2 | 2.9% | -1.1% |
Quigley noted Kelly is seeing improving revenue growth in its professional and industrial segment with demand exceeding pre-pandemic levels.
MSP, RPO, professional payroll outsourcing and consulting revenue are included in Kelly’s outsourcing and consulting revenue.
Revenue by geography
| (US$ millions) | Q1 2021 | Q1 2020 | % change | % constant currency |
| Americas | ||||
| United States | $858.5 | $928.5 | -7.5% | -7.5% |
| Mexico | $34.6 | $28.7 | 20.6% | 24.6% |
| Canada | $34.1 | $32.8 | 3.9% | -1.8% |
| Puerto Rico | $24.2 | $17.7 | 36.4% | 36.4% |
| Brazil | – | $9.1 | nm | nm |
| Europe, Middle East and Africa | ||||
| France | $54.3 | $52.5 | 3.4% | -5.2% |
| Switzerland | $52.7 | $44.2 | 19.2% | 11.8% |
| Portugal | $43.7 | $43.6 | 0.2% | -8.1% |
| Russia | $32.6 | $32.1 | 1.5% | 14.1% |
| Italy | $18.1 | $14.7 | 22.9% | 12.7% |
| UK | $17.0 | $22.3 | -23.7% | -29.1% |
| Germany | $7.1 | $8.0 | -11.4% | -18.8% |
| Ireland | $5.1 | $5.0 | 2.2% | -6.3% |
| Other Europe | $15.6 | $15.2 | 2.7% | -4.0% |
| Asia Pacific | ||||
| Total APAC | $8.3 | $6.7 | 24.9% | 12.8% |
Guidance
Kelly forecast full-year revenue to be up between 10% an 12%.
Share price and market cap
KELYA shares were down 2.28% to $24.45 as of 12:05 p.m. Eastern time; they were 9.38% below their 52-week high, according to FT.com. The company had a market cap of $989.9 million.