QUOTE AND NEWS
DailyFinance  Mar 25  Comment 
TROY, MI -- (Marketwired) -- 03/25/14 -- Kelly Services, Inc. (NASDAQ: KELYA) (NASDAQ: KELYB), a leader in providing workforce solutions, has announced the top performers within its global talent supply chain. The Supplier Excellence Awards...
SeekingAlpha  Mar 22  Comment 
By Detroit Bear: According to the Bureau of Labor Statistics, unemployment rates continue to improve at a nice rate. As of February, the BLS pegged unemployment at 6.7%. I think most people who follow economic data understand that this number is...
DailyFinance  Mar 3  Comment 
TROY, MI -- (Marketwired) -- 03/03/14 -- Kelly Services, Inc. (NASDAQ: KELYA) (NASDAQ: KELYB), a leader in providing workforce solutions, today announced it will be presenting at the Sidoti & Company Eighteenth Annual Emerging Growth...
DailyFinance  Feb 25  Comment 
TROY, MI -- (Marketwired) -- 02/25/14 -- Kelly Services, Inc. (NASDAQ: KELYA) (NASDAQ: KELYB), a leader in providing workforce solutions, today announced it will be presenting at the Credit Suisse 16th Annual Global Services Conference on...
DailyFinance  Feb 24  Comment 
TROY, MI -- (Marketwired) -- 02/24/14 -- Kelly Services® (NASDAQ: KELYA) (NASDAQ: KELYB), a leader in providing workforce solutions, today announced the release of its newest app, WorkWire, targeted to job seekers. The WorkWire iPad app is...
DailyFinance  Feb 13  Comment 
TROY, MI -- (Marketwired) -- 02/13/14 -- Kelly Services, Inc. (NASDAQ: KELYA) (NASDAQ: KELYB), a leader in providing workforce solutions, today announced that its Board of Directors has declared a quarterly dividend of 5 cents per share on...
SeekingAlpha  Feb 4  Comment 
By Ashleigh Rogers: Kelly Services, Inc. (KELYA) is trading around $23 near the top end of its 52-week range (~$15-25), but despite this I think the stock has at least another 20% upside from these levels. Kelly's business is supplying businesses...
DailyFinance  Feb 3  Comment 
TROY, MI -- (Marketwired) -- 02/03/14 -- Kelly Services (NASDAQ: KELYA) (NASDAQ: KELYB), a leader in providing workforce solutions, has joined the Committee for Economic Development, the American Staffing Association, and other U.S.-based...
SeekingAlpha  Jan 30  Comment 
Kelly Services, Inc. (KELYA) Q4 2013 Earnings Call January 30, 2014 9:00 am ET Executives Carl T. Camden – President, Chief Executive Officer & Director Patricia A. Little – Chief Financial Officer & Executive Vice President ...
StreetInsider.com  Jan 30  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Earnings/Kelly+Services%2C+Inc.+%28KELYA%29+Tops+Q4+EPS+by+14c/9104637.html for the full story.




 
TOP CONTRIBUTORS

Kelly Services (NASDAQ: KELYA) is a staffing company that makes money by placing people in temporary positions at firms around the globe. About 45% of the company’s placements are for the commoditized low-skilled positions.[1] In 2009, the company provided temporary employment for approximately 480,000 employees to more than 90% of the Fortune 500.[2] These companies typically "order" large numbers of workers and are able to negotiate volume discounts with Kelly. As a result of its high concentration of low skilled labor and the large size of its clients, Kelly's operating margins were among the lowest in the staffing industry at 1.4%.

Temporary staffing is highly influenced by economic cycles because temporary employees are the first to be cut in down cycles and the first to be hired in up cycles.[3] Kelly is more vulnerable to economic cycles, particularly those in the U.S., than its more geographically diverse competitors. Although the company's international revenues have been growing as a percentage of total revenue over the last 5 years, a majority of Kelly's revenue still comes from the U.S. and to a much lesser extent Canada. This is markedly different from its major competitors, Manpower (MAN) and Adecco SA (ADO), which generate no more than a third of their revenue from any one country and 90% of revenue outside the U.S.

Company Overview

Business Financials

2009 was a difficult year financially for Kelly Services. Total revenues for the year was $4.31 billion, a significant decline from its 2008 total revenues of $5.52 billion. This decline in revenues had an adverse effect on its net income. Between 2008 and 2009, Kelly Services' net loss increased from $82 million in 2008 to $105 million in 2009.

Business Segments

Commercial (76.2% of 2009 revenue)[4]

This segment primarily includes temporary and permanent staffing for office services, contact centers, light industrial jobs, and electronic assembly jobs. Commercial staffing makes up the majority of Kelly's revenue and also accounts for much of the low skill staffing the company provides.

Professional, Technical, and Staffing Alternatives (23.8% of 2009 revenue)[4]

This segment primarily includes temporary and permanent staffing for jobs in information technology, engineering, and finance. This segment provides more specialized offerings resulting in higher profitability.

Trends and Forces

U.S. Temporary Employment down since June 2007

Temporary employment is usually a leading indicator of overall employment: in a down economy temporary employees are let go first and in a booming economy temporary employees are first to be hired.[5] Since June 2007, temporary employment has been down significantly in the US.[6]

EU Directive Makes Effort to Reduce Labor Laws

In June 2008, the EU made a directive that addressed the positive impact temporary staffing has on the labor market. The directive requires countries in the EU to make at least the minimum requirements specified by the directive. Some of these actions include banning all laws that discriminate in any way and adding a law against disability discrimination.[7] These discrimination laws have more of an impact today because falling birthrates in Europe have caused many countries to start importing workers, in particular muslims.[8] France has already lifted restrictions on permanent placement; however, restrictions are still prevalent in other countries. In Spain, temporary staffing is prohibited in the construction industry, as well as public services (Belgium does not allow temporary staffing in public services either).[9] A report by Eurociett, the European Confederation of Private Employment Agencies, stated that if only two of the recommended actions of the directive are adopted by six EU countries, then by 2012 about 570,000 more jobs could be created.[10]

Competition

Kelly competes with about 100 national staffing companies in the US and another 10,000 local staffing companies.[11] Kelly competes with much larger competitors such as Manpower (MAN) and Adecco SA (VTX:ADEN), as well as more specialized firms such as Robert Half International (RHI). Competitors Manpower and Adecco both get over 50% of revenues from low skilled staffing and get their revenues from placing very large amounts of people per year. Competitor Robert Half International specializes in accounting and financial staffing and this specialization allows the company to charge premiums and attain industry leading profitability. Kelly falls in the middle with about 45% of its revenues coming from low skill staffing and the rest coming from more specialized IT, engineering and financial staffing.

References

  1. Morningstar Analyst Research, Thesis
  2. KELYA 10-K 2009 Item 1 Pg. 3
  3. The Temp Boom: Will Hiring Follow
  4. 4.0 4.1 KELYA10-K 2009 Item 7 Pg. 18
  5. The Temp Boom: Will Hiring Follow
  6. Economic Egomaniacs
  7. EBU Newsletter #49
  8. What in the World is Going On? A Global Intelligence Briefing for CEOs by Herbert Meyer
  9. Adecco Welcomes Compromise in EU Agency Work Directive
  10. More Work Opportunities for More People
  11. KELYA Morningstar Analyst Research, Thesis
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