Revenue and Profitability - Revenue from services in Q2 2025 increased by 4.2% to $1,101.8 million, primarily driven by the acquisition of MRP[140] - Gross profit for Q2 2025 rose by 5.5% to $225.5 million, but decreased by 5.1% when excluding the impact of the acquisition[141] - Net earnings for Q2 2025 were $19.0 million, reflecting a significant increase of 314.7% compared to $4.6 million in Q2 2024[139] - Revenue from the Education segment grew by 5.6% in Q2 2025, reaching $265.3 million, supported by improved fill rates[152] - Revenue from talent solutions increased by 2.3% in Q2 2025, while permanent placement revenue decreased by 8.7%[140] - Revenue from services for the first six months of 2025 increased by 7.8% to $2,266.7 million, driven by the MRP acquisition[145] - Consolidated total gross profit increased by 5.5% to $225.5 million in Q2 2025, with a year-to-date increase of 10.2% to $462.0 million[161] Expenses and Margins - Total SG&A expenses increased by 8.2% to $207.3 million in Q2 2025, with a decrease of 2.2% when excluding the acquisition impact[142] - SG&A expenses increased by 8.8% to $194.8 million in Q2 2025, with a year-to-date increase of 13.4% to $407.7 million[169] - The gross profit rate for the first six months of 2025 increased by 50 basis points to 20.4%, primarily due to the MRP acquisition[146] - The gross profit rate for consolidated total increased by 0.3 percentage points to 20.5% in Q2 2025 compared to the prior year[161] Cash Flow and Liquidity - Cash, cash equivalents, and restricted cash totaled $24.5 million at the end of Q2 2025, down from $45.6 million at year-end 2024[187] - Net cash generated from operating activities was $119.3 million in the first six months of 2025, compared to $32.2 million in the same period of 2024[188] - The company believes its cash flow from operations and available liquidity will be sufficient to meet anticipated cash requirements[201] - The company continues to monitor liquidity and capital resources globally, utilizing cash pooling and intercompany loans to meet funding needs[197] Debt and Financing - The current ratio decreased to 1.5 at the end of Q2 2025 from 1.7 at year-end 2024[189] - The debt-to-total capital ratio improved to 5.5% at the end of Q2 2025 from 16.2% at year-end 2024[192] - The company entered into interest rate swaps locking in variable SOFR rates at fixed rates of 4.772% and 4.468% for portions of long-term borrowings[209] - As of the end of the second quarter of 2025, the company had $130.0 million available on its $150.0 million revolving credit facility and $153.1 million on its $250.0 million securitization facility[200] Acquisitions and Operations - The acquisition of MRP was finalized for a purchase price of $425.0 million, with an adjusted cash payment of $440.0 million due to estimated cash and working capital adjustments[199] - The integration of MRP's portfolio is progressing, with realignment of sales and recruiting teams completed in Q2 2025[132] - SET revenue from services increased due to the acquisition of MRP staffing and outcome-based solutions, while excluding the acquisition, revenue decreased by 7.8%[157] - Education revenue growth was driven by higher fill rates and bill rates, partially offset by weather-related school closures[158] Profitability by Segment - ETM reported a profit decrease of 28.5% to $11.1 million in Q2 2025, while SET profit increased by 2.1% to $19.3 million[176] Other Financial Information - The company has no material unrecorded commitments or guarantees associated with related parties or unconsolidated entities[194] - The company has additional unsecured, uncommitted short-term local credit facilities totaling $3.2 million, with no borrowings as of the second quarter-end 2025[202] - The company expects working capital requirements to increase with rising demand for its services[196] - The company has not identified plans to repatriate a majority of its international cash balances following the sale of its EMEA operations[197]
Kelly Services(KELYB) - 2026 Q2 - Quarterly Report