Following its second-quarter earnings release, Kelly Services said it will restructure its Americas operations and close 40 commercial branches.
The branch closings are expected to occur over the third and fourth quarters of 2007.
While the world’s fifth-largest recruitment firm also has plans to restructure British operations and consolidate headquarters, it says it will expand in Japan, China, Hong Kong, and Singapore.
According to the company, revenue in its Americas Commercial segment, which accounted for 49% of total sales, decreased 5.7% year over year in the second quarter. Operating earnings totaled $23.0 million, and decreased 12.9% compared to last year. Revenue in the Americas PTSA segment, which accounted for 19% of total sales, decreased 1.9% year over year in the second quarter. Operating earnings totaled $13.6 million and increased 1.3% on a year over year basis.
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Overall, Kelly’s global revenue for the second quarter of 2007 totaled $1.416 billion, a 1.6% increase compared to the $1.393 billion for the corresponding quarter in 2006.
“For the full year of 2007, we are currently forecasting that earnings will range between $1.60 and $1.70 per share, compared to $1.56 per share from continuing operations in 2006. The range excludes the gain on the sale of the Home Care business and the U.K. and Americas restructuring costs,” Kelly president and CEO Carl Camden said in a statement.
“This guidance reflects our view that the U.S. economy will avoid a recession in 2007, and that our Americas staffing segments will resume positive revenue growth late in the 4th quarter of this year,” said Camden.