- Strategic restructuring follows comprehensive review of
company's growth and efficiency objectives as part of ongoing
transformation
- Aggressive action builds on strategic progress to monetize
non-core assets, reinvest capital in organic and inorganic growth
initiatives, and shift to higher-margin, higher-growth business
mix
- Actions expected to result in meaningful, sustainable EBITDA
margin expansion beginning immediately, and substantial improvement
in the second half of 2023 and beyond
TROY,
Mich., July 20, 2023 /PRNewswire/ -- Kelly
(Nasdaq: KELYA, KELYB), a leading global specialty talent solutions
provider, today announced strategic restructuring actions that will
further optimize the company's operating model to enhance
organizational efficiency and effectiveness. These actions are part
of the comprehensive transformation initiative the company
announced in May to drive EBITDA margin improvement and accelerate
long-term profitable growth.
The strategic restructuring actions realign business-critical
resources to Kelly's business units, streamline corporate
resources, reduce redundant organizational layers, and optimize
work processes. These structural changes simplify the company's
operations and unlock additional resources to invest in growth. As
a result of these actions, the company has implemented a workforce
reduction plan and notified affected employees in accordance with
applicable employment laws and regulations. Employees whose roles
were included in the workforce reduction are eligible for
applicable severance, benefits, and outplacement services.
"Today marks a difficult but necessary step forward on Kelly's
journey to accelerate profitable growth," said Peter Quigley, president and chief executive
officer. "These actions follow an exhaustive review of the
company's business and functional operations to determine how we
can work more efficiently to improve profitability over the long
term. I am confident the structural improvements we have made to
Kelly's operating model position the company to pursue new avenues
of growth that will enable it to deliver greater value for
customers, talent, and shareholders."
As a result of the strategic restructuring actions, Kelly
expects to see meaningful expansion of its EBITDA margin beginning
immediately with substantial improvement in the second half of 2023
and beyond. The company expects to incur a restructuring charge
from these actions in the range of $7.5-$8.5 million
in the third quarter of 2023. Mr. Quigley and Olivier Thirot,
executive vice president and chief financial officer, will provide
additional details about the strategic restructuring as it relates
to the company's ongoing transformation, including expectations for
EBITDA margin improvement, during its upcoming second-quarter
earnings conference call on August 10,
2023.
About Kelly®
Kelly Services, Inc. (Nasdaq: KELYA, KELYB) helps companies
recruit and manage skilled workers and helps job seekers
find great work. Since inventing the staffing industry in
1946, we have become experts in the many industries and local and
global markets we serve. With a network of suppliers
and partners around the world, we connect more than 450,000
people with work every year. Our suite of outsourcing and
consulting services ensures companies have the people they
need, when and where they are needed most. Headquartered in
Troy, Michigan, we empower
businesses and individuals to access limitless opportunities
in industries such as science, engineering, technology,
education, manufacturing, retail, finance, and energy. Revenue
in 2022 was $5.0 billion. Learn more
at kellyservices.com.
Forward-Looking Statements
This release contains statements that are forward looking in
nature and, accordingly, are subject to risks and uncertainties.
These statements are made under the "safe harbor" provisions of the
U.S. Private Securities Litigation Reform Act of 1995. Statements
that are not historical facts, including statements about Kelly's
financial expectations, are forward-looking statements. Factors
that could cause actual results to differ materially from those
contained in this release include, but are not limited to, (i)
changing market and economic conditions, (ii) disruption in the
labor market and weakened demand for human capital resulting from
technological advances, loss of large corporate customers and
government contractor requirements, (iii) the impact of laws and
regulations (including federal, state and international tax laws),
(iv) unexpected changes in claim trends on workers' compensation,
unemployment, disability and medical benefit plans, (v) litigation
and other legal liabilities (including tax liabilities) in excess
of our estimates, (vi) our ability to achieve our business's
anticipated growth strategies, (vi) our future business
development, results of operations and financial
condition, (vii) damage to our brands, (viii) dependency on
third parties for the execution of critical functions, (ix)
conducting business in foreign countries, including foreign
currency fluctuations, (x) availability of temporary workers with
appropriate skills required by customers, (xi) cyberattacks or
other breaches of network or information technology security, and
(xii) other risks, uncertainties and factors discussed in this
release and in the Company's filings with the Securities and
Exchange Commission. In some cases, forward-looking statements can
be identified by words or phrases such as "may," "will," "expect,"
"anticipate," "target," "aim," "estimate," "intend," "plan,"
"believe," "potential," "continue," "is/are likely to" or other
similar expressions. All information provided in this press release
is as of the date of this press release and we undertake no
duty to update any forward-looking statement to conform the
statement to actual results or changes in the Company's
expectations.
KLYA-FIN
MEDIA
CONTACT:
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ANALYST
CONTACT:
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Jane
Stehney
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James
Polehna
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(248)
765-6864
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(248)
244-4586
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stehnja@kellyservices.com
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james.polehna@kellyservices.com
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SOURCE Kelly Services, Inc.