Part I [Business Overview](index=3&type=section&id=ITEM%201.%20BUSINESS.) Kelly Services, Inc. is a global specialty talent solutions company, realigned into five segments in 2020, serving a diverse customer base and facing intense competition - In 2020, Kelly Services assigned nearly **370,000 temporary employees** to customers worldwide and served **75 of the Fortune 100™ companies**[16](index=16&type=chunk)[17](index=17&type=chunk) - The company's largest single customer accounted for approximately **5% of total revenue** in 2020, while the largest 100 customers contributed an estimated **53%**[31](index=31&type=chunk) - Working capital needs are significant as customer payments lag employee payroll, with Days Sales Outstanding (DSO) at **64 days** as of January 3, 2021[30](index=30&type=chunk) - The company competes in a highly fragmented industry against major players like Randstad, Adecco Group, ManpowerGroup Inc., Recruit Holdings, and Allegis Group[33](index=33&type=chunk) Company Business Segments (as of 2020) | Segment | Description | | :--- | :--- | | **Professional & Industrial** | Staffing, outcome-based, and direct-hire services for office, professional, light industrial, and contact center specialties in the U.S. and Canada | | **Science, Engineering & Technology** | Staffing, outcome-based, and direct-hire services for science, clinical research, engineering, IT, and telecommunications specialties, mainly in the U.S. and Canada | | **Education** | Staffing, direct-hire, and executive search for K-12, early childhood, and higher education markets in the U.S. | | **Outsourcing & Consulting** | Delivers Managed Service Provider (MSP), Recruitment Process Outsourcing (RPO), and Payroll Process Outsourcing (PPO) services globally | | **International** | Staffing and direct-hire services in 15 countries in Europe, as well as Mexico | [Risk Factors](index=10&type=section&id=ITEM%201A.%20RISK%20FACTORS.) The company faces significant macroeconomic, competitive, strategic, operational, and regulatory risks, including the impact of COVID-19, intense industry competition, and concentrated voting control - The COVID-19 outbreak has negatively impacted business, with decreased customer demand for staffing services, especially in the Education segment due to school closures, with the duration and extent of the impact remaining uncertain[57](index=57&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) - The company operates in a highly competitive market with low barriers to entry, facing pressure from larger competitors like Randstad and Adecco, as well as emerging online platforms[63](index=63&type=chunk) - Technological advances such as automation, robotics, and AI may disrupt the labor market and weaken demand for human capital, posing a risk to the staffing industry[65](index=65&type=chunk) - The Terence E. Adderley Revocable Trust K is the controlling stockholder, holding approximately **91.6% of the outstanding Class B voting shares**, giving it the ability to elect or remove all directors[101](index=101&type=chunk) - The company's bank credit facilities contain financial covenants, and failure to meet them could result in lenders declaring all outstanding borrowings due and payable[111](index=111&type=chunk) [Properties](index=20&type=section&id=ITEM%202.%20PROPERTIES.) The company's headquarters is in Troy, Michigan, with other operations in leased facilities, and most employees worked remotely in 2020 due to COVID-19 - The company's headquarters is in Troy, Michigan, with other U.S. and international operations in leased facilities, and most internal employees worked remotely in 2020 due to COVID-19[113](index=113&type=chunk) [Legal Proceedings](index=20&type=section&id=ITEM%203.%20LEGAL%20PROCEEDINGS.) The company is involved in routine litigation, including a $300,000 secondary liability from a Hungarian Competition Authority decision, with no expected material adverse financial impact - The company is subject to ordinary course litigation, including a fine from the Hungarian Competition Authority with the company's secondary liability being approximately **$300,000**[116](index=116&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=21&type=section&id=ITEM%205.%20MARKET%20FOR%20THE%20REGISTRANT%27S%20COMMON%20EQUITY%2C%20RELATED%20STOCKHOLDER%20MATTERS%20AND%20ISSUER%20PURCHASES%20OF%20EQUITY%20SECURITIES.) The company's Class A and B common stock trade on NASDAQ, with dividends suspended in 2020 due to COVID-19, and its five-year performance graph shows underperformance against the S&P SmallCap 600 Quarterly Stock Price and Dividend Data (2020 vs. 2019) | Year | Quarter | Class A High ($) | Class A Low ($) | Dividends/Share ($) | | :--- | :--- | :--- | :--- | :--- | | **2020** | Q1 | 22.77 | 10.13 | 0.075 | | | Q2 | 18.18 | 11.01 | — | | | Q3 | 19.89 | 13.55 | — | | | Q4 | 23.00 | 15.56 | — | | **2019** | Q1 | 25.63 | 20.00 | 0.075 | | | Q2 | 26.39 | 22.03 | 0.075 | | | Q3 | 28.91 | 23.50 | 0.075 | | | Q4 | 25.09 | 20.74 | 0.075 | - The company suspended its quarterly dividend in May 2020 due to the uncertainty surrounding the COVID-19 crisis[143](index=143&type=chunk) Five-Year Cumulative Total Return Comparison | Investment | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Kelly Services, Inc.** | $100.00 | $144.09 | $173.74 | $132.06 | $147.41 | $134.81 | | **S&P SmallCap 600 Index** | $100.00 | $126.56 | $143.30 | $131.15 | $161.03 | $179.20 | [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=24&type=section&id=ITEM%207.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS.) The MD&A details the significant COVID-19 impact on 2020 financial performance, including a 15.7% revenue decline, net loss, and a $147.7 million goodwill impairment, offset by increased operating cash flow from cost-saving measures and CARES Act benefits [Executive Overview](index=24&type=section&id=Executive%20Overview) The Executive Overview highlights the COVID-19 impact on 2020 performance, leading to cost-saving measures, a $147.7 million goodwill impairment, and a strategic realignment into five specialty business units - In response to the COVID-19 crisis in April 2020, the company implemented significant cost-saving measures, including a **10% pay cut** for salaried employees, reduced executive compensation, furloughs, and suspension of the company match to certain retirement accounts[141](index=141&type=chunk)[145](index=145&type=chunk) - The Board of Directors suspended the quarterly dividend effective May 2020 due to the uncertainty surrounding the pandemic[143](index=143&type=chunk) - A decline in the company's common stock price triggered an interim goodwill impairment test, resulting in a **$147.7 million non-cash charge** in the first quarter of 2020[147](index=147&type=chunk) - The company reorganized its business into five distinct reporting segments to focus on high-margin, higher-value specialties: Professional & Industrial, Science, Engineering & Technology, Education, Outsourcing & Consulting, and International[149](index=149&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) In fiscal year 2020, total revenue decreased **15.7% to $4.5 billion**, resulting in a **$93.6 million operating loss** and a **$72.0 million net loss**, primarily due to COVID-19 and a **$147.7 million goodwill impairment**, with all segments experiencing declines, notably **Education at 36.3%** Total Company Financial Summary (2020 vs. 2019) | Metric | 2020 (53 Weeks) | 2019 (52 Weeks) | % Change | | :--- | :--- | :--- | :--- | | Revenue from services | $4,516.0 M | $5,355.6 M | (15.7)% | | Gross profit | $827.6 M | $968.4 M | (14.5)% | | Earnings (loss) from operations | ($93.6) M | $81.8 M | NM | | Net earnings (loss) | ($72.0) M | $112.4 M | NM | - The 2020 operating loss was primarily driven by a **$147.7 million goodwill impairment charge** taken in the first quarter[164](index=164&type=chunk)[166](index=166&type=chunk) Segment Revenue Performance (2020 vs. 2019) | Segment | 2020 Revenue | 2019 Revenue | % Change | | :--- | :--- | :--- | :--- | | Professional & Industrial | $1,858.4 M | $2,213.4 M | (16.0)% | | Science, Engineering & Technology | $1,019.1 M | $1,131.8 M | (9.9)% | | Education | $286.9 M | $450.7 M | (36.3)% | | Outsourcing & Consulting | $363.5 M | $377.7 M | (3.8)% | | International | $988.6 M | $1,182.5 M | (16.4)% | - The Education segment's significant revenue decline was due to temporary school closures, delayed starts, and the use of virtual or hybrid instructional models, which reduced demand[185](index=185&type=chunk) [Financial Condition, Liquidity and Capital Resources](index=40&type=section&id=Financial%20Condition%2C%20Liquidity%20and%20Capital%20Resources) The company's liquidity strengthened in 2020, with cash increasing to **$228.1 million** driven by **$186.0 million** in operating cash flow, aided by a **$117.0 million** CARES Act payroll tax deferral and reduced working capital, despite Global DSO rising to **64 days** - Cash, cash equivalents, and restricted cash increased significantly to **$228.1 million** at year-end 2020, compared to **$31.0 million** at year-end 2019[232](index=232&type=chunk) - Net cash from operating activities was **$186.0 million** in 2020, a substantial increase from **$102.2 million** in 2019, primarily due to the deferral of **$117.0 million** in payroll tax payments permitted by the CARES Act[233](index=233&type=chunk) - Global Days Sales Outstanding (DSO) increased to **64 days** in 2020 from **58 days** in 2019, attributed to some customers taking full payment terms and a shift in customer mix[234](index=234&type=chunk) - At year-end 2020, the company had **$200.0 million** of available capacity on its revolving credit facility and **$97.0 million** on its securitization facility, providing substantial liquidity[246](index=246&type=chunk) [Critical Accounting Estimates](index=44&type=section&id=Critical%20Accounting%20Estimates) Critical accounting estimates include Workers' Compensation, Business Combinations, Income Taxes, and Goodwill impairment, with the latter being significant in 2020 due to a **$147.7 million impairment charge** that wrote off the entire goodwill balance - The accrual for workers' compensation is a critical estimate, utilizing actuarial methods, with the net accrual being **$54.6 million** at year-end 2020[254](index=254&type=chunk)[321](index=321&type=chunk) - Goodwill is tested for impairment annually or when a triggering event occurs, with a significant decline in market capitalization in Q1 2020 being a triggering event[261](index=261&type=chunk)[264](index=264&type=chunk) - The interim goodwill impairment test in Q1 2020 resulted in a non-cash charge of **$147.7 million**, which wrote off the entire goodwill balance of the company's reporting units at that time[264](index=264&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=48&type=section&id=ITEM%207A.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK.) The company faces market risks including foreign currency, interest rate, and market and currency risk from its investment in Persol Holdings, which is marked to market through net earnings and can cause material fluctuations - The company is exposed to market and currency risks on its investment in Persol Holdings, which is marked to market through net earnings and may have a material impact[276](index=276&type=chunk) [Financial Statements and Supplementary Data](index=48&type=section&id=ITEM%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA.) This section presents the consolidated financial statements for 2020, 2019, and 2018, along with PricewaterhouseCoopers LLP's unqualified auditor's report, which identifies Workers' Compensation and Goodwill Impairment as Critical Audit Matters, and detailed notes on accounting policies and financial components [Auditor's Report and Management's Report on Internal Control](index=56&type=section&id=Auditor%27s%20Report%20and%20Management%27s%20Report%20on%20Internal%20Control) Management and PricewaterhouseCoopers LLP concluded that internal control over financial reporting was effective, with the auditor issuing an unqualified opinion and identifying Workers' Compensation and Goodwill Impairment as Critical Audit Matters - Management and the independent auditor, PricewaterhouseCoopers LLP, concluded that the company's internal control over financial reporting was effective as of January 3, 2021[306](index=306&type=chunk)[312](index=312&type=chunk) - The auditor's report identified two Critical Audit Matters: Workers' Compensation and the Goodwill Impairment Assessment for the Americas Staffing and Global Talent Solutions reporting units[320](index=320&type=chunk) [Consolidated Financial Statements](index=60&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements for fiscal 2020 show revenue of **$4.52 billion**, a net loss of **$72.0 million**, diluted loss per share of **$1.83**, total assets of **$2.56 billion**, and a **$197.1 million** net increase in cash from operations Key Financial Statement Data (Fiscal Year 2020) | Metric | Amount | | :--- | :--- | | **Statement of Earnings** | | | Revenue from services | $4,516.0 M | | Net loss | ($72.0) M | | Diluted loss per share | ($1.83) | | **Balance Sheet (at Jan 3, 2021)** | | | Total Assets | $2,561.9 M | | Total Liabilities | $1,358.9 M | | Total Stockholders' Equity | $1,203.0 M | | **Cash Flow Statement** | | | Net cash from operating activities | $186.0 M | | Net change in cash | $197.1 M | [Notes to Consolidated Financial Statements](index=67&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail financial results and accounting policies, including revenue disaggregation, 2020 acquisitions and divestitures, the **$147.7 million goodwill impairment**, debt facilities, and recast segment disclosures for the new five-segment operating model - In 2020, the company acquired Insight Workforce Solutions for **$34.5 million** and Greenwood/Asher & Associates for **$3.5 million**, and sold its Brazil operations for **$1.4 million**[422](index=422&type=chunk)[425](index=425&type=chunk)[438](index=438&type=chunk) - A goodwill impairment charge of **$147.7 million** was recorded in Q1 2020, writing off the entire goodwill balance of the Americas Staffing and Global Talent Solutions reporting units[469](index=469&type=chunk) - The company's new five-segment structure was adopted in Q3 2020, with prior period segment results recast for comparability, and corporate expenses, including the goodwill impairment charge, reported separately[569](index=569&type=chunk)[571](index=571&type=chunk)[572](index=572&type=chunk) Part III [Directors, Executive Officers, Compensation, Security Ownership, and Principal Accountant Fees](index=50&type=section&id=ITEMS%2010%2C%2011%2C%2012%2C%2013%20AND%2014) This section incorporates information from the 2021 proxy statement, including executive officers, the Code of Business Conduct and Ethics, and details on securities authorized for issuance under equity compensation plans - Most information required by Part III, including details on directors, executive compensation, and certain relationships, is incorporated by reference from the company's forthcoming proxy statement[288](index=288&type=chunk) - As of January 3, 2021, the company's executive officers included Peter W. Quigley (President and CEO) and Olivier G. Thirot (EVP and CFO)[289](index=289&type=chunk) - As of fiscal year-end 2020, there were **3,313,249 securities** remaining available for future issuance under equity compensation plans approved by security holders[294](index=294&type=chunk) Part IV [Exhibits, Financial Statement Schedules](index=54&type=section&id=ITEM%2015.%20EXHIBITS%2C%20FINANCIAL%20STATEMENT%20SCHEDULES.) This section lists all financial statements, schedules, and exhibits filed with the Form 10-K report, including Management's Report on Internal Control, the Independent Auditor's Report, and consolidated financial statements and notes - This section provides an index of all financial statements, schedules, and exhibits filed with the report, including consents of experts and certifications[298](index=298&type=chunk)[300](index=300&type=chunk)

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 27, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-1088 KELLY SERVICES, INC. --------------------------------------------------------------------- (Exact name of registrant as specified in its charter) (State or other juri ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 28, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-1088 KELLY SERVICES, INC. --------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 38-1510762 (Stat ...

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 29, 2020 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-1088 KELLY SERVICES, INC. (Exact name of registrant as specified in its charter) Delaware 38-1510762 (State or other jurisdiction of incorporation or organization) (I.R.S. Emp ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 29, 2019 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to __________ Commission file number 0-1088 KELLY SERVICES, INC. (Exact Name of Registrant as specified in its Charter) (State or other jurisdiction of incorporatio ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 29, 2019 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-1088 KELLY SERVICES, INC. --------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 38-1510762 ...

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The unaudited consolidated financial statements for Q2 2019 show net earnings of **$83.8 M** (vs. **$15.4 M** loss in 2018) driven by a **$61.2 M** investment gain, with total assets rising to **$2.54 B** and operating cash flow at **$73.5 M** [Consolidated Statements of Earnings](index=4&type=section&id=Consolidated%20Statements%20of%20Earnings) Financial Metric | Financial Metric | 13 Weeks Ended June 30, 2019 | 13 Weeks Ended July 1, 2018 | | :--- | :--- | :--- | | Revenue from services | $1,367.5 M | $1,386.9 M | | Gross profit | $244.0 M | $240.5 M | | Earnings from operations | $34.8 M | $20.4 M | | Gain (loss) on investment in Persol Holdings | $61.2 M | $(52.5) M | | **Net earnings (loss)** | **$83.8 M** | **$(15.4) M** | | **Diluted earnings (loss) per share** | **$2.12** | **$(0.40)** | - The company's net earnings for Q2 2019 were significantly impacted by a **$61.2 M** gain on its investment in Persol Holdings, a stark contrast to the **$52.5 M** loss from the same investment in Q2 2018. This swing was the primary driver of the increase in net earnings and EPS year-over-year[12](index=12&type=chunk) [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) Balance Sheet Item | Balance Sheet Item | June 30, 2019 | December 30, 2018 | | :--- | :--- | :--- | | **Total current assets** | **$1,392.9 M** | **$1,400.5 M** | | Goodwill | $127.8 M | $107.3 M | | Operating lease right-of-use assets | $66.9 M | $— M | | Investment in Persol Holdings | $213.7 M | $135.1 M | | **Total Assets** | **$2,542.3 M** | **$2,314.4 M** | | **Total current liabilities** | **$931.1 M** | **$897.5 M** | | Operating lease liabilities (noncurrent) | $49.3 M | $— M | | **Total stockholders' equity** | **$1,268.2 M** | **$1,159.5 M** | - Total assets increased primarily due to a **$20.5 M** increase in goodwill from acquisitions, a **$78.6 M** increase in the fair value of the Persol Holdings investment, and the recognition of **$66.9 M** in operating lease right-of-use assets upon adoption of the new lease standard (ASC 842)[17](index=17&type=chunk)[77](index=77&type=chunk)[102](index=102&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Item (26 Weeks Ended) | Cash Flow Item (26 Weeks Ended) | June 30, 2019 | July 1, 2018 | | :--- | :--- | :--- | | Net cash from operating activities | $73.5 M | $33.2 M | | Net cash used in investing activities | $(79.6) M | $(10.9) M | | Net cash from (used in) financing activities | $8.6 M | $(20.5) M | | **Net change in cash, cash equivalents and restricted cash** | **$2.4 M** | **$1.7 M** | - Cash used in investing activities for the first half of 2019 increased significantly to **$79.6 M**, primarily due to **$86.4 M** spent on acquisitions (NextGen and GTA), partially offset by **$13.8 M** in proceeds from asset sales[26](index=26&type=chunk) [Notes to Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) - In Q1 2019, the company acquired NextGen Global Resources for **$51.0 M** and Global Technology Associates (GTA) for **$34.0 M** to increase market share in telecommunications and engineering solutions[48](index=48&type=chunk)[49](index=49&type=chunk)[51](index=51&type=chunk) - The company recorded a gain of **$74.4 M** on its investment in Persol Holdings for the first six months of 2019, compared to a loss of **$28.8 M** in the same period of 2018, due to changes in the investment's fair value[59](index=59&type=chunk) - Restructuring costs of **$5.7 M** were incurred in 2019, primarily for severance related to the transformation of U.S. branch-based staffing operations within the Americas Staffing segment[72](index=72&type=chunk) - The company adopted the new lease accounting standard (ASC 842) in Q1 2019, resulting in the recognition of **$74.1 M** of right-of-use assets and corresponding lease liabilities on the balance sheet[101](index=101&type=chunk)[102](index=102&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Q2 2019 saw total revenue decline **1.4%** (up **0.2%** constant currency) with gross profit up **1.4%** and earnings from operations surging **70.7%** to **$34.8 M**, while operating cash flow reached **$73.5 M** despite acquisition-driven negative investing cash flow [Executive Overview](index=30&type=section&id=Executive%20Overview) - The company's strategy is focused on becoming a leading talent solutions provider by achieving leadership in scale or specialty, embracing the future of work, attracting top talent, and investing in innovation and efficiency[143](index=143&type=chunk) - In January 2019, Kelly acquired Global Technology Associates (GTA) and NextGen Global Resources to expand its engineering portfolio, positioning itself as a leader in the growing 5G telecommunications market[145](index=145&type=chunk) - In Q1 2019, the company restructured its U.S. commercial staffing operations to improve efficiency and focus on specialties, resulting in **$5.7 M** in restructuring charges for the first half of the year[148](index=148&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) Total Company Performance - Q2 2019 vs Q2 2018 | Metric | 2019 | 2018 | Change | CC Change | | :--- | :--- | :--- | :--- | :--- | | Revenue from services | $1,367.5 M | $1,386.9 M | (1.4)% | (0.2)% | | Gross profit | $244.0 M | $240.5 M | 1.4% | 2.6% | | Earnings from operations | $34.8 M | $20.4 M | 70.7% | N/A | | Gross profit rate | 17.8% | 17.3% | +0.5 pts | N/A | - The acquisitions of NextGen and GTA in January 2019 added approximately **280 basis points** to the total revenue growth rate for Q2 2019 and accounted for **30 basis points** of the gross profit rate growth[156](index=156&type=chunk)[157](index=157&type=chunk) Segment Performance (Earnings from Operations) - Q2 2019 vs Q2 2018 | Segment | Q2 2019 | Q2 2018 | Change | | :--- | :--- | :--- | :--- | | Americas Staffing | $15.6 M | $17.8 M | (12.4)% | | Global Talent Solutions (GTS) | $25.4 M | $17.7 M | 43.0% | | International Staffing | $3.5 M | $6.4 M | (44.8)% | [Financial Condition](index=41&type=section&id=Financial%20Condition) - The company generated **$73.5 M** of net cash from operating activities in the first six months of 2019, a significant increase from **$33.2 M** in the same period of 2018, reflecting recurring working capital changes[198](index=198&type=chunk) - Global Days Sales Outstanding (DSO) was **57 days** at the end of Q2 2019, up from **55 days** at the end of Q2 2018[198](index=198&type=chunk) - The working capital position decreased by **$41.2 M** from year-end 2018 to **$461.8 M** at the end of Q2 2019, impacted by the acquisitions of NextGen and GTA[199](index=199&type=chunk) - As of Q2 2019, the company had **$150.0 M** available on its revolving credit facility and **$130.3 M** available on its securitization facility, providing committed funding capacity[209](index=209&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from foreign currency fluctuations and interest rate changes, with a material yen-denominated investment in Persol Holdings whose fair value changes impact net earnings - The company faces foreign currency risk related to its foreign subsidiaries, which can impact the U.S. dollar value of reported earnings and investments. However, a natural hedge exists as subsidiaries primarily derive revenues and incur expenses in their local currency[215](index=215&type=chunk) - A significant market and currency risk exists with the investment in Persol Holdings. The investment is yen-denominated and stated at fair value, with changes in value recognized in net earnings, which can be material[217](index=217&type=chunk) [Item 4. Controls and Procedures](index=44&type=section&id=Item%204.%20Controls%20and%20Procedures) The CEO and CFO concluded that disclosure controls and procedures were effective as of Q2 2019, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO have concluded that the company's disclosure controls and procedures are effective at a reasonable assurance level as of the end of the second quarter of 2019[219](index=219&type=chunk) - No changes occurred during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[220](index=220&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=44&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various ordinary course legal proceedings, including a Hungarian competition authority case, but management expects no material adverse effect on financial condition or operations - The company is continuously engaged in litigation arising from the ordinary course of business, including matters related to employment, contracts, and bankruptcy proceedings[222](index=222&type=chunk) - Management believes that the resolution of current legal proceedings will not have a material adverse effect on the company's financial condition or results of operations[223](index=223&type=chunk) - In January 2018, the Hungarian Competition Authority initiated proceedings against the company for alleged infringement of national competition regulations; the company is cooperating and does not expect a material adverse effect[225](index=225&type=chunk) [Item 1A. Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the company's risk factors from those previously disclosed in its Annual Report on Form 10-K for the year ended December 30, 2018 - There have been no material changes in the Company's risk factors from those disclosed in the Annual Report on Form 10-K for the year ended December 30, 2018[226](index=226&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q2 2019, the company had no unregistered equity sales but reacquired **2,800 shares** of Class A common stock at **$24.81** per share for employee tax withholdings Issuer Repurchases of Equity Securities - Q2 2019 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 1 - May 5, 2019 | 329 | $22.70 | | May 6 - June 2, 2019 | 2,415 | $25.09 | | June 3 - June 30, 2019 | 56 | $25.26 | | **Total** | **2,800** | **$24.81** | - The company reacquired **2,800 shares** during the quarter to cover employee tax withholdings due upon the vesting of restricted stock and performance shares[228](index=228&type=chunk) [Item 3. Defaults Upon Senior Securities](index=45&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable as there were no defaults upon senior securities - Not applicable[229](index=229&type=chunk) [Item 4. Mine Safety Disclosures](index=45&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable - Not applicable[230](index=230&type=chunk) [Item 5. Other Information](index=45&type=section&id=Item%205.%20Other%20Information) This item is not applicable - Not applicable[231](index=231&type=chunk) [Item 6. Exhibits](index=45&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications by the CEO and CFO pursuant to the Sarbanes-Oxley Act and Inline XBRL data files - This section provides an index of all exhibits filed with the report, including CEO and CFO certifications (Exhibits 31.1, 31.2, 32.1, 32.2) and XBRL data files[232](index=232&type=chunk)[237](index=237&type=chunk)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2019 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-1088 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q KELLY SERVICES, INC. --------------------------------------------------------------------- (Exact name of registrant as specified in its charter) DELAWARE 38-1510762 ...

Commission file number 0-1088 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K For the transition period from _________ to __________ [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 30, 2018 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 KELLY SERVICES, INC. (Exact Name of Registrant as specified in its Charter) Delaware 38-1510762 (State or other juri ...