Kelly Services: Q3 Earnings Snapshot
Thursday, Nov 7, 2024 7:59 am ET
1min read Kelly Services (Nasdaq: KELYA, KELYB), a leading global specialty talent solutions provider, recently announced its third-quarter 2024 earnings. The company reported a 7.1% year-over-year decline in revenue, primarily due to the sale of its European staffing operations. However, organic revenue remained nearly flat, reflecting the company's resilience in the face of market challenges.
Kelly Services' adjusted EBITDA margin increased by 20 basis points to 2.5% in Q3 2024, driven by cost-cutting measures and operational efficiency. The company's transformation actions, including the acquisition of Motion Recruitment Partners, LLC (MRP), contributed to a $9.1 million increase in adjusted earnings. Despite the revenue decline, Kelly Services' adjusted earnings per share remained strong at $0.21.
The acquisition of MRP added $2.0 million of earnings from operations in Q3 2024 and contributed to reported Q3 year-over-year revenue growth. The ongoing transformation actions have driven significant progress in the execution of the company's initiatives, with adjusted earnings from operations improving 60% year-over-year in Q3 2023.
Kelly Services expects the sale of European staffing operations, the acquisition of MRP, and ongoing transformation actions to contribute to continued year-over-year EBITDA margin expansion in Q4 2024. Assuming the benefit of a full year of transformation-related savings, the sale of European staffing operations, and current top-line trends, the company would expect to reach a normalized, adjusted EBITDA margin in the range of 3.3 to 3.5%.
In conclusion, Kelly Services' Q3 earnings snapshot demonstrates the company's ability to adapt to market conditions and maintain growth. Despite the sale of its European staffing operations, the company's organic revenue remained stable, and its adjusted EBITDA margin expanded. The acquisition of MRP and ongoing transformation actions have contributed to the company's earnings and positioned it for continued growth in the future.
Kelly Services' adjusted EBITDA margin increased by 20 basis points to 2.5% in Q3 2024, driven by cost-cutting measures and operational efficiency. The company's transformation actions, including the acquisition of Motion Recruitment Partners, LLC (MRP), contributed to a $9.1 million increase in adjusted earnings. Despite the revenue decline, Kelly Services' adjusted earnings per share remained strong at $0.21.
The acquisition of MRP added $2.0 million of earnings from operations in Q3 2024 and contributed to reported Q3 year-over-year revenue growth. The ongoing transformation actions have driven significant progress in the execution of the company's initiatives, with adjusted earnings from operations improving 60% year-over-year in Q3 2023.
Kelly Services expects the sale of European staffing operations, the acquisition of MRP, and ongoing transformation actions to contribute to continued year-over-year EBITDA margin expansion in Q4 2024. Assuming the benefit of a full year of transformation-related savings, the sale of European staffing operations, and current top-line trends, the company would expect to reach a normalized, adjusted EBITDA margin in the range of 3.3 to 3.5%.
In conclusion, Kelly Services' Q3 earnings snapshot demonstrates the company's ability to adapt to market conditions and maintain growth. Despite the sale of its European staffing operations, the company's organic revenue remained stable, and its adjusted EBITDA margin expanded. The acquisition of MRP and ongoing transformation actions have contributed to the company's earnings and positioned it for continued growth in the future.
