TROY, Mich., April 03, 2025 (GLOBE NEWSWIRE) -- Kelly Education, the nation's most trusted provider of education talent and workforce solutions, is expanding its commitment to Kentucky substitute teacher development with the rollout of Kelly Education Learning Pathways™. This enhanced professional learning platform is designed to equip substitute educators with the skills and confidence they need to succeed in the classroom. The inaugural offering for substitute teachers is available in three levels: Essent ...

TROY, Mich., March 12, 2025 (GLOBE NEWSWIRE) -- Kelly (NASDAQ:KELYA, KELYB)), a leading global specialty talent solutions provider, today announced it will participate in the Sidoti Virtual Investor Conference on Wednesday, March 19, 2025. Peter Quigley, president and chief executive officer, Troy Anderson, executive vice president and chief financial officer, and Scott Thomas, head of investor relations, will participate in one-on-one meetings. Kelly's investor presentation is available on the Company's we ...

Core Insights - Kelly Education has been approved by the Wisconsin Department of Public Instruction to provide substitute teacher training, addressing the teacher shortage in Wisconsin [1][2] - The training program is designed for individuals without a degree or certification in education, allowing them to obtain a three-year substitute permit [1] - The curriculum includes practical strategies and specialized practices for teaching students with various needs, ensuring substitutes are well-prepared for classroom challenges [2][3] Company Overview - Kelly Education specializes in customized workforce solutions across the education sector, including hiring, recruiting, and professional development [5] - The organization has over 26 years of experience in developing training materials for substitute teachers, integrating best practices for instructional continuity [2] - The company operates under Kelly, a global workforce solutions provider, connecting individuals with opportunities in various fields [5] Training Program Details - The training modules cover a range of topics from basic instructional strategies to specialized practices for children with autism, ADHD, and learning disabilities [3] - The program includes interactive elements and knowledge checks to engage learners effectively [3] - The introductory online training fee is set at $39.99, with a completion window of 90 days for registered applicants [6]

Core Insights - Kelly has formed an integrated permanent hiring solutions business line by combining KellyOCG's global recruitment process outsourcing (RPO) specialty with Motion Recruitment Partners' talent acquisition solutions brand, Sevenstep, creating a top five global talent solutions offering [1] - Amy Bush has been appointed as the leader of the integrated business, overseeing operations in 71 countries with 33 in-country teams and 19 global hub locations, following the acquisition of Motion Recruitment Partners in 2024 [2] - The integration aims to leverage the strengths of both KellyOCG and Sevenstep to enhance service delivery and innovative technology offerings for clients [3] Company Overview - Kelly Services, Inc. has been a leader in staffing since 1946, connecting over 400,000 people with work annually and generating $4.3 billion in revenue in 2024 [4] - The company specializes in various industries including science, engineering, technology, education, manufacturing, retail, finance, and energy, providing outsourcing and consulting services [4] Sevenstep Overview - Sevenstep is recognized as a global leader in talent acquisition solutions, offering permanent hiring, total talent management, predictive analytics, and strategic consulting services [5] - The company is acknowledged as a key player in recruitment process outsourcing (RPO) and managed services provider (MSP) by industry organizations such as HRO Today and Everest Group [5]

Financial Data and Key Metrics Changes - In Q4 2024, organic revenue increased by more than 4% and adjusted EBITDA rose by 34%, reflecting strong profitability with 110 basis points of margin expansion [11][34] - Total revenue for Q4 2024 was $1.19 billion, a decrease of 3.3% year-over-year, but organic revenue was up 4.4% [22][35] - Adjusted EBITDA for the full year was $143.5 million, up 31%, with an adjusted EBITDA margin improvement of 100 basis points to 3.3% [37] Business Line Data and Key Metrics Changes - The education segment saw a 12% year-over-year revenue increase in Q4, driven by improved fill rates and higher bill rates [24] - The SET segment's revenue was up 38% on a reported basis due to the acquisition of Motion Recruitment Partners, but organic revenue was down 4% [24][25] - OCG segment revenue grew by 9%, while the professional industrial segment improved by 4% year-over-year [26][27] Market Data and Key Metrics Changes - The staffing market experienced overall declines, with total staffing industry revenues down in most segments by double digits [16] - The outcome-based solutions in PNI and SET showed positive trends, with PNI's outcome-based specialties up 5.9% [23][28] Company Strategy and Development Direction - The company is focused on integrating Motion Recruitment Partners to enhance its staffing, consulting, and RPO solutions [16][48] - There is a strategic shift towards higher margin, higher growth areas, including outcome-based solutions [54] - The company plans to unify OCG and PNI under common operational management to better address customer preferences for integrated workforce solutions [52][53] Management's Comments on Operating Environment and Future Outlook - Management noted a cautious customer sentiment due to macroeconomic factors, with expectations for modest improvements in market conditions throughout 2025 [39][84] - The company anticipates capturing additional market share and delivering incremental organic revenue growth in 2025 [40] Other Important Information - The company completed the sale of its European Staffing business for over $100 million and the sale of Ayres Group to focus on global RPO and MS solutions [15] - An impairment charge of $72.8 million was recognized related to the Softworld acquisition due to lower than expected performance [31][32] Q&A Session Summary Question: Impact of hurricanes on the education segment - Management indicated that the education segment's performance in Q4 was significantly impacted by two hurricanes, which disrupted school districts [59] Question: Insights on new customer wins and sales pipeline - Management expressed confidence in their ability to continue winning market share due to higher fill rates and better performance [61] Question: M&A market conditions - Management noted that deal flow remains low, with a disconnect between sellers' valuation expectations and performance [66] Question: Demand for staffing and pricing insights - Management highlighted strong demand in the PNI segment, with a seasonal uptick in Q4, while SET faced challenges in the IT market [73][75] Question: Customer sentiment and macroeconomic environment - Management observed a cautious approach from customers due to recent executive orders and pending legislation, impacting their plans and demand [84] Question: Organic growth outlook for 2025 - Management expects modest growth in the first half of 2025, with education continuing to grow but not at double-digit rates [88][90] Question: Integration of OCG and PNI - Management is currently analyzing segment reporting for 2025 and will provide updates on any changes [95]

Revenue and Profitability - Revenue from services decreased by 10.4% to $4,331.8 million in 2024, compared to $4,835.7 million in 2023, primarily due to the sale of EMEA staffing operations[142] - Gross profit declined by 8.2% to $882.6 million, with a gross profit rate of 20.4%, an increase of 0.5 percentage points from the previous year[145] - Consolidated total gross profit decreased by 8.2% from $961.4 million in 2023 to $882.6 million in 2024[166] - The gross profit rate for the Professional & Industrial segment decreased by 20 basis points, primarily due to declines in permanent placement revenue[167] - Science, Engineering & Technology segment gross profit increased due to the acquisition of MRP, with a gross profit rate increase of 120 basis points[168] - Education segment gross profit increased by 8.6% from $128.7 million in 2023 to $139.8 million in 2024, despite a 90 basis point decrease in gross profit rate[169] - Outsourcing & Consulting segment gross profit decreased, with a gross profit rate decline of 480 basis points due to a change in business mix[170] - The company reported a net loss of $0.6 million in 2024, a significant decline from net earnings of $36.4 million in 2023[153] Expenses and Cost Management - Total SG&A expenses decreased by 12.4% to $818.4 million, with restructuring charges significantly reduced from $38.6 million in 2023 to $6.1 million in 2024[146] - Total SG&A expenses decreased by 14.3% from $894.6 million in 2023 to $766.9 million in 2024, primarily due to lower direct salaries[178] - Corporate expenses decreased year-over-year primarily due to lower transformation-related charges, despite higher transaction-related expenses[196] Acquisitions and Sales - The acquisition of Motion Recruitment Partners, LLC on May 31, 2024, is expected to enhance staffing and consulting capabilities across technology and government specialties[135] - The company completed the sale of its European staffing operations on January 2, 2024, and the Ayers Group on June 12, 2024, focusing on a streamlined North American model[134] - The company completed the sale of its EMEA staffing operations for cash proceeds of $110.6 million, net of cash disposed[220] - The company acquired 100% of MRP for a purchase price of $425.0 million, resulting in a cash payment of $440.0 million[221] Cash Flow and Working Capital - Cash, cash equivalents, and restricted cash totaled $45.6 million at year-end 2024, down from $167.6 million at year-end 2023[205] - The company generated $26.9 million of net cash from operating activities in 2024, a decrease from $76.7 million in 2023, primarily due to increased working capital requirements[206] - Trade accounts receivable increased to $1.3 billion at year-end 2024 from $1.2 billion at year-end 2023, with global Days Sales Outstanding (DSO) remaining at 59 days[207] - The company's working capital position was $539.0 million at year-end 2024, down from $606.7 million at year-end 2023, primarily due to lower cash balances[208] Debt and Financing - Financing activities generated $214.8 million in 2024, compared to cash used of $59.6 million in 2023, primarily due to net borrowings of $239.4 million related to the acquisition of MRP[213] - The debt-to-total capital ratio was 16.2% at year-end 2024, with no debt outstanding at year-end 2023[215] - The company repurchased $10.0 million of Class A common stock in fiscal 2024, with $40.0 million remaining under the share repurchase program[226] Goodwill and Impairment - The company recorded a goodwill impairment charge of $72.8 million for the Softworld reporting unit in 2024, with a remaining goodwill balance of $38.5 million[246] - Total goodwill amounted to $304.2 million at year-end 2024, compared to $151.1 million at year-end 2023[252] - The company performed annual impairment tests for all reporting units with goodwill, concluding that the estimated fair value of the Softworld reporting unit no longer exceeded its carrying value[246] Tax and Valuation - The company recorded an $18.4 million tax benefit associated with the goodwill impairment charge for Softworld[246] - The company utilizes third-party valuation specialists to determine the fair value of acquired intangible assets, including trade names and customer relationships[235] - The fair value of trade name intangibles is determined using the relief-from-royalty method, while customer relationship intangibles are assessed using the multi-period excess earnings method[235] - The company evaluates its tax accruals regularly, with current tax accruals presented in income and other taxes on the consolidated balance sheet[238] Foreign Currency and Risk Management - The Company entered into a foreign currency forward contract with a notional amount of €90.0 million to manage foreign currency risk, resulting in an unrealized loss of $3.6 million as of year-end 2023[262] - A total loss of $2.4 million was realized upon settlement of the foreign currency forward contract on January 5, 2024, leading to a gain of $1.2 million recorded in the first quarter of 2024[262] - The Company entered into another foreign currency forward contract with a notional amount of €17.0 million related to expected additional proceeds from the sale of EMEA staffing operations[263] - The Company is exposed to foreign currency risk primarily related to its foreign subsidiaries, which provide a natural hedge against currency risks[261] - Changes in foreign currency rates generally do not impact local cash flows due to the nature of the Company's foreign operations[261] Insurance and Compensation - The Company retains an independent consulting actuary to establish ultimate loss forecasts for its insurance and self-insurance programs[233] - The accrual for workers' compensation was $44.4 million at year-end 2024, up from $43.6 million at year-end 2023[234] - The obligation to pay benefits under the nonqualified deferred compensation plan is influenced by movements in equity and debt markets[266]

Group 1 - Kelly Services reported quarterly earnings of $0.82 per share, exceeding the Zacks Consensus Estimate of $0.44 per share, but down from $0.93 per share a year ago, representing an earnings surprise of 86.36% [1] - The company posted revenues of $1.19 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.64%, compared to year-ago revenues of $1.23 billion [2] - Over the last four quarters, Kelly Services has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [2] Group 2 - The stock has underperformed the market, losing about 4.7% since the beginning of the year, while the S&P 500 has gained 2.9% [3] - The current consensus EPS estimate for the coming quarter is $0.67 on revenues of $1.16 billion, and for the current fiscal year, it is $2.59 on revenues of $4.64 billion [7] - The Zacks Industry Rank indicates that the Staffing Firms industry is currently in the bottom 24% of over 250 Zacks industries, which may impact stock performance [8]

Financial Performance - Q4 revenue was $1.2 billion, a decrease of 3.3% year-over-year, but an increase of 4.4% on an organic basis[5] - Adjusted EBITDA for Q4 was $43.5 million, up 34% compared to the prior year, with an adjusted EBITDA margin of 3.7%, an increase of 110 basis points[5] - Full-year revenue totaled $4.3 billion, down 10.4% as reported, but up 0.5% on an organic basis[12] - The company reported an operating loss of $56.7 million in Q4, primarily due to $80.8 million in non-cash impairment charges[6] - Adjusted operating income for the full year was $92.1 million, with adjusted EBITDA of $143.5 million, reflecting a 31% increase year-over-year[12] - Loss per share for Q4 was $0.90, compared to earnings per share of $0.31 in the same quarter of 2023[6] - Net earnings turned negative with a loss of $0.6 million in 2024, down from a profit of $36.4 million in 2023[20] - Basic earnings per share decreased to $(0.02) in 2024 from $0.99 in 2023, reflecting a significant decline[20] - Net earnings for Q4 2024 were $(31.8) million, compared to $11.4 million in Q4 2023, reflecting a significant decline[39] - Adjusted net earnings for Q4 2024 were $29.1 million, down from $34.1 million in Q4 2023, indicating a decrease of approximately 14.7%[39] Revenue and Segment Performance - The acquisition of Motion Recruitment Partners contributed 9.8% to Q4 year-over-year revenue growth[6] - Revenue from services decreased to $4,331.8 million in 2024 from $4,835.7 million in 2023, a decline of 10.4%[20] - The Science, Engineering & Technology segment saw a revenue increase of 37.9%, rising to $396.1 million in 2024 from $287.3 million in 2023[23] - The Professional & Industrial segment reported a revenue increase of 4.4%, reaching $384.2 million in 2024 compared to $368.1 million in 2023[23] - Revenue from services decreased by 3.3% year-over-year, totaling $1,191.1 million in Q4 2024 compared to $1,232.2 million in Q4 2023[33] - The Americas region saw a revenue increase of 16.2% in Q4 2024, with the United States contributing $1,075.5 million, up from $908.7 million in Q4 2023[33] Expenses and Impairments - Gross profit fell to $882.6 million in 2024, down from $961.4 million in 2023, representing an 8.2% decrease[20] - The company recorded a goodwill impairment charge of $72.8 million in 2024, with no such charge in 2023[23] - Goodwill impairment charges amounted to $72.8 million in Q4 2024, impacting overall earnings from operations[37] - The company reported a goodwill impairment charge of $54.4 million in Q4 2024, which significantly impacted net earnings[39] - Total SG&A expenses decreased to $818.4 million in 2024 from $934.7 million in 2023, a reduction of 12.4%[20] Cash Flow and Assets - Year-to-date free cash flow for 2024 was $15.8 million, a decrease from $61.4 million in 2023[29] - Free cash flow for 2024 was $15.8 million, down from $61.4 million in 2023, showing a decline of approximately 74.3%[43] - Total assets increased to $2,632.3 million in 2024 from $2,581.6 million in 2023, representing a growth of 2.0%[29] - Total current liabilities decreased to $826.5 million in 2024 from $1,019.9 million in 2023, a reduction of 18.9%[29] - The company reported a current ratio of 1.7 in 2024, indicating improved liquidity compared to 1.6 in 2023[29] - Total stockholders' equity decreased to $1,234.6 million in 2024 from $1,253.7 million in 2023, reflecting a decline of 1.5%[29] Future Outlook and Strategic Initiatives - The company expects incremental organic revenue growth and adjusted EBITDA margin expansion during fiscal 2025[5] - The company plans to focus on market expansion and new product development to drive future growth despite recent challenges[30] - The planned retirement of CEO Peter Quigley by the end of 2025 has been announced, with a search for his successor underway[9] Tax and Other Charges - The effective income tax rate increased to 97.1% in 2024 from (46.5%) in 2023, indicating a significant change in tax impact[20] - Total income tax expense for Q4 2024 was $(23.8) million, compared to $(6.5) million in Q4 2023, indicating a higher tax benefit[39] - The 2023 tax adjustments related to the sale of EMEA staffing operations included a $19.1 million valuation allowance for deferred tax assets in the U.K.[56] Integration and Restructuring - The company incurred integration costs of $2.9 million in Q4 2024, compared to no such costs in Q4 2023[39] - The integration costs in 2024 are associated with the MRP acquisition and aligning processes across the company[49] - Restructuring charges for 2024 include $3.0 million of severance and $3.1 million for transformation execution, while 2023 restructuring charges totaled $17.7 million for transformation costs and $11.6 million for severance[53] - The restructuring initiative started in Q2 2023 aims to enhance organizational efficiency and effectiveness[53]

Core Insights - Kelly Services reported fourth-quarter and full-year 2024 earnings, highlighting organic revenue growth and a significant increase in adjusted EBITDA [2][5][6]. Financial Performance - Q4 revenue was $1.2 billion, a decrease of 3.3% year-over-year, but an increase of 4.4% on an organic basis. Full-year revenue totaled $4.3 billion, down 10.4% as reported, but up 0.5% organically [5][6]. - Q4 operating loss was $56.7 million, impacted by $80.8 million in non-cash impairment charges. Adjusted operating income was $29.2 million, up 32% from the prior year [5][6]. - Adjusted EBITDA for Q4 was $43.5 million, reflecting a 34% increase year-over-year, with an adjusted EBITDA margin of 3.7%, up 110 basis points [5][6]. - For the full year, adjusted EBITDA was $143.5 million, a 31% increase compared to the previous year, with an adjusted EBITDA margin of 3.3%, an increase of 100 basis points [5][6]. Strategic Developments - The company achieved 100 basis points of net margin expansion and unlocked over $100 million in capital through operational streamlining, which was redeployed towards the acquisition of Motion Recruitment Partners [2][5]. - The planned retirement of CEO Peter Quigley by the end of 2025 was announced, with a search for his successor already initiated [9][10]. Shareholder Returns - A quarterly cash dividend of $0.075 per share was declared, payable on March 12, 2025, to stockholders of record as of February 26, 2025 [11]. - The company executed share repurchases totaling $10 million during Q4 2024 as part of its share repurchase program [11]. Financial Outlook - The company anticipates incremental organic revenue growth and adjusted EBITDA margin expansion during fiscal 2025, assuming stable staffing market conditions in the first half of the year [13].

Core Insights - Kelly Services reported fourth-quarter and full-year 2024 earnings, highlighting organic revenue growth that outpaced the market and a 34% increase in adjusted EBITDA [2][5] - The company achieved 100 basis points of net margin expansion and unlocked over $100 million in capital through operational streamlining, which was redeployed for the acquisition of Motion Recruitment Partners [2][5] - The company anticipates continued organic revenue growth and adjusted EBITDA margin expansion in fiscal 2025 [5][6] Financial Performance - Q4 revenue was $1.2 billion, a decrease of 3.3% year-over-year, but an increase of 4.4% on an organic basis [5][6] - Full-year revenue totaled $4.3 billion, down 10.4% as reported, but up 0.5% on an organic basis [5][6] - Q4 operating loss was $56.7 million, primarily due to $80.8 million in non-cash impairment charges, while adjusted operating income was $29.2 million, up 32% from the prior year [5][6] - Adjusted EBITDA for Q4 was $43.5 million, reflecting a 34% increase year-over-year, with an adjusted EBITDA margin of 3.7%, up 110 basis points [5][6] - Full-year adjusted EBITDA was $143.5 million, a 31% increase from the previous year, with an adjusted EBITDA margin of 3.3%, an increase of 100 basis points [5][6] Strategic Developments - The company announced the planned retirement of CEO Peter Quigley by the end of 2025, initiating a search for his successor [9][10] - Quigley has been instrumental in the company's transformation into a leading global specialty talent solutions provider [10] Shareholder Returns - The board declared a quarterly cash dividend of $0.075 per share, payable on March 12, 2025 [11] - The company executed share repurchases totaling $10 million during Q4 2024 as part of its share repurchase program [11]