Kelly Services(R) Reports 4th Quarter and Full Year 2014 Results

TROY, MI--(Marketwired - Jan 29, 2015) - Kelly Services, Inc. (NASDAQ: KELYA) (NASDAQ: KELYB), a leader in providing workforce solutions, today announced results for the fourth quarter and full year of 2014.

Carl T. Camden, President and Chief Executive Officer, announced revenue for the fourth quarter of 2014 totaled $1.4 billion, a 3% increase (a 6% increase on a constant currency basis) compared to the corresponding quarter of 2013. Revenue for the full year totaled $5.6 billion, a 3% increase (a 4% increase on a constant currency basis) compared to the prior year.

Earnings from operations for the fourth quarter of 2014 totaled $2.6 million, compared to $9.6 million reported for the fourth quarter of 2013. Included in the results of operations in the fourth quarter of 2014 are restructuring charges of $6.2 million. The results of operations in the fourth quarter of 2013 included restructuring charges of $0.3 million. Excluding the restructuring charges from both years, earnings from operations were $8.8 million in the fourth quarter of 2014, compared to adjusted earnings of $9.9 million last year.

Earnings from operations for the full year of 2014 totaled $21.9 million compared to $53.3 million in 2013. Included in the results from operations for 2014 are restructuring charges of $12.0 million. Included in the results from operations for 2013 are asset impairment charges of $1.7 million and restructuring charges of $1.6 million. Excluding these items from both years, earnings from operations were $33.9 million in 2014 compared to $56.6 million in 2013.

Diluted earnings per share in the fourth quarter of 2014 were $0.44 compared to $0.45 per share in the fourth quarter of 2013. Included in diluted earnings per share from continuing operations for the fourth quarter of 2014 are restructuring charges of $0.10 per share. Included in diluted earnings per share from continuing operations for the fourth quarter of 2013 are restructuring charges of $0.01 per share. Excluding these charges from both years, diluted earnings per share from continuing operations for the fourth quarter of 2014 were $0.54 per share compared to $0.45 per share in 2013.

Diluted earnings per share from continuing operations for the full year of 2014 were $0.61 compared to $1.54 per share in 2013. Included in diluted earnings per share from continuing operations for 2014 are restructuring charges of $0.19 per share. Included in diluted earnings per share from continuing operations for 2013 are restructuring charges of $0.04 per share and asset impairment charges of $0.04 per share. Excluding these charges from both periods, diluted earnings per share from continuing operations for 2014 were $0.81 per share compared to $1.62 per share in 2013.

Commenting on the fourth quarter, Camden stated, "The fourth quarter capped a year of significant investment at Kelly, and we're pleased that our performance confirms those investments are gaining traction. With our new delivery models fully in place, we have begun capitalizing on improved U.S. market conditions and increased demand for specialized staffing. The strong results delivered by our OCG segment reflects our ongoing ability to also meet the growing demand for holistic talent management solutions, especially among our largest customers."

In conjunction with its fourth quarter and full year earnings release, Kelly Services, Inc. will host a conference call at 9:00 a.m. (ET) on January 29, to review the results and answer questions. The call may be accessed in one of the following ways:

Via the Telephone:

U.S. 1 800 288-9626
International 1 651 291-5254

The pass code is Kelly Services

Via the Internet:

The call is also available via the internet through the Kelly Services website:
www.kellyservices.com

This release contains statements that are forward looking in nature and, accordingly, are subject to risks and uncertainties. These factors include, but are not limited to, competitive market pressures including pricing and technology introductions, changing market and economic conditions, our ability to achieve our business strategy, the risk of damage to our brand, our ability to successfully develop new service offerings, our exposure to risks associated with services outside traditional staffing, including business process outsourcing, our increasing dependency on third parties for the execution of critical functions, the risks associated with past and future acquisitions, exposure to risks associated with investments in equity affiliates, material changes in demand from or loss of large corporate customers, risks associated with conducting business in foreign countries, including foreign currency fluctuations, availability of temporary workers with appropriate skills required by customers, liabilities for employment-related claims and losses, including class action lawsuits and collective actions, the risk of cyber attacks or other breaches of network or information technology security as well as risks associated with compliance on data privacy, our ability to sustain critical business applications through our key data centers, our ability to effectively implement and manage our information technology programs, our ability to maintain adequate financial and management processes and controls, impairment charges triggered by adverse industry or market developments, unexpected changes in claim trends on workers' compensation, disability and medical benefit plans, the impact of the Patient Protection and Affordable Care Act on our business, the impact of changes in laws and regulations (including federal, state and international tax laws and the expiration and/or reinstatement of the U.S. work opportunity credit program), the risk of additional tax or unclaimed property liabilities in excess of our estimates, our ability to maintain specified financial covenants in our bank facilities to continue to access credit markets, and other risks, uncertainties and factors discussed in this release and in the Company's filings with the Securities and Exchange Commission. Actual results may differ materially from any forward looking statements contained herein, and we have no intention to update these statements.

About Kelly Services^®

Kelly Services, Inc. (NASDAQ: KELYA) (NASDAQ: KELYB) is a leader in providing workforce solutions. Kelly^® offers a comprehensive array of outsourcing and consulting services as well as world-class staffing on a temporary, temporary-to-hire and direct-hire basis. Serving clients around the globe, Kelly provided employment to approximately 555,000 employees in 2014. Revenue in 2014 was $5.6 billion. Visit kellyservices.com and connect with us on Facebook, LinkedIn, & Twitter.

KLYA-FIN

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE 13 WEEKS ENDED DECEMBER 28, 2014 AND DECEMBER 29, 2013
(UNAUDITED)
(In millions of dollars except per share data)
													%		CC %
			2014			2013			Change				Change		Change
Revenue from services			$	1,425.0		$	1,385.8		$	39.2			2.8	%	5.7	%
Cost of services				1,192.4			1,154.3			38.1			3.3
Gross profit				232.6			231.5			1.1			0.5		3.4
Selling, general and administrative expenses				230.0			221.9			8.1			3.6		6.8
Earnings from operations				2.6			9.6			(7.0	)		(71.7	)
Other expense, net				1.1			0.6			0.5			89.6
Earnings before taxes				1.5			9.0			(7.5	)		(81.8	)
Income tax benefit				(15.5	)		(8.2	)		(7.3	)		(89.3	)
Net earnings			$	17.0		$	17.2		$	(0.2	)		(0.2	)%
Basic earnings per share			$	0.44		$	0.45		$	(0.01	)		(2.2	)%
Diluted earnings per share			$	0.44		$	0.45		$	(0.01	)		(2.2	)%
STATISTICS:
Gross profit rate				16.3	%		16.7	%		(0.4	)	pts.
Selling, general and administrative expenses:
	% of revenue			16.1			16.0			0.1
	% of gross profit			98.8			95.9			2.9
% Return:
	Earnings from operations			0.2			0.7			(0.5	)
	Earnings before taxes			0.1			0.6			(0.5	)
	Net earnings			1.2			1.2			-
Effective income tax rate				(949.7	)%		(91.1	)%		(858.6	)	pts.
Average number of shares outstanding (millions):
	Basic			37.7			37.4
	Diluted			37.7			37.4
Shares adjusted for nonvested restricted awards (millions):
	Basic			38.9			38.6
	Diluted			38.9			38.6

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE 52 WEEKS ENDED DECEMBER 28, 2014 AND DECEMBER 29, 2013
(UNAUDITED)
(In millions of dollars except per share data)
													%		CC %
			2014			2013			Change				Change		Change
Revenue from services			$	5,562.7		$	5,413.1		$	149.6			2.8	%	3.8	%
Cost of services				4,654.3			4,523.6			130.7			2.9
Gross profit				908.4			889.5			18.9			2.1		3.2
Selling, general and administrative expenses				886.5			834.5			52.0			6.2		7.3
Asset impairments				-			1.7			(1.7	)		(100.0	)
Earnings from operations				21.9			53.3			(31.4	)		(59.1	)
Other expense, net				5.3			4.5			0.8			15.3
Earnings before taxes				16.6			48.8			(32.2	)		(66.0	)
Income tax benefit				(7.1	)		(10.1	)		3.0			29.6
Net earnings			$	23.7		$	58.9		$	(35.2	)		(59.8)	%
Basic earnings per share			$	0.61		$	1.54		$	(0.93	)		(60.4)	%
Diluted earnings per share			$	0.61		$	1.54		$	(0.93	)		(60.4)	%
STATISTICS:
Gross profit rate				16.3	%		16.4	%		(0.1	)	pts.
Selling, general and administrative expenses:
	% of revenue			15.9			15.4			0.5
	% of gross profit			97.6			93.8			3.8
% Return:
	Earnings from operations			0.4			1.0			(0.6	)
	Earnings before taxes			0.3			0.9			(0.6	)
	Net earnings			0.4			1.1			(0.7	)
Effective income tax rate				(43.2	)%		(20.8	)%		(22.4	)	pts.
Average number of shares outstanding (millions):
	Basic			37.5			37.3
	Diluted			37.5			37.3
Shares adjusted for nonvested restricted awards (millions):
	Basic			38.6			38.3
	Diluted			38.6			38.3

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)
				Fourth Quarter
														Constant
														Currency
				2014				2013			Change			Change
AMERICAS
	Commercial
		Revenue from services		$	694.5			$	641.5		8.3	%		9.3	%
		Staffing fee-based income included in revenue from services			4.0				3.4		16.0			17.4
		Gross profit			99.6				95.7		4.2			5.2
		Gross profit rate			14.4	%			14.9	%	(0.5	)	pts.
	PT
		Revenue from services		$	232.9			$	234.1		(0.5	)%		(0.2)	%
		Staffing fee-based income included in revenue from services			3.9				3.7		4.1			5.0
		Gross profit			37.5				39.0		(3.6	)		(3.3	)
		Gross profit rate			16.1	%			16.6	%	(0.5	)	pts.
	Total Americas
		Revenue from services		$	927.4			$	875.6		5.9	%		6.7	%
		Staffing fee-based income included in revenue from services			7.9				7.1		9.8			10.9
		Gross profit			137.1				134.7		2.0			2.7
		Total SG&A expenses			113.9				109.2		4.4			5.1
		Earnings from operations			23.2				25.5		(8.5	)
		Gross profit rate			14.8	%			15.4	%	(0.6	)	pts.
		Expense rates:
			% of revenue		12.3				12.5		(0.2	)
			% of gross profit		83.0				81.1		1.9
		Return on sales			2.5				2.9		(0.4	)
EMEA
	Commercial
		Revenue from services		$	204.5			$	232.2		(12.0	)%		(2.4)	%
		Staffing fee-based income included in revenue from services			3.3				4.9		(31.9	)		(19.2	)
		Gross profit			29.6				34.8		(15.1	)		(5.6	)
		Gross profit rate			14.4	%			15.0	%	(0.6	)	pts.
	PT
		Revenue from services		$	44.8			$	48.0		(6.5	)%		2.7	%
		Staffing fee-based income included in revenue from services			2.8				3.3		(16.0	)		(2.5	)
		Gross profit			9.6				10.6		(8.7	)		1.8
		Gross profit rate			21.7	%			22.2	%	(0.5	)	pts.
	Total EMEA
		Revenue from services		$	249.3			$	280.2		(11.0	)%		(1.5)	%
		Staffing fee-based income included in revenue from services			6.1				8.2		(25.5	)		(12.5	)
		Gross profit			39.2				45.4		(13.6	)		(3.9	)
		SG&A expenses excluding restructuring charges			36.4				42.2		(13.7	)
		Restructuring charges			-				0.3		(100.0	)
		Total SG&A expenses			36.4				42.5		(14.4	)		(2.9	)
		Earnings from operations			2.8				2.9		(2.2	)
		Earnings from operations excluding restructuring charges			2.8				3.2		(11.8	)
		Gross profit rate			15.7	%			16.2	%	(0.5	)	pts.
		Expense rates (excluding restructuring charges):
			% of revenue		14.6				15.1		(0.5	)
			% of gross profit		92.8				92.9		(0.1	)
		Return on sales (excluding restructuring charges)			1.1				1.1		-

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)
				Fourth Quarter
														Constant
														Currency
				2014				2013			Change			Change
APAC
	Commercial
		Revenue from services		$	91.3			$	87.3		4.6	%		9.7	%
		Staffing fee-based income included in revenue from services			2.0				2.2		(6.9	)		(3.4	)
		Gross profit			11.8				12.5		(5.4	)		(0.8	)
		Gross profit rate			12.9	%			14.3	%	(1.4	)	pts.
	PT
		Revenue from services		$	11.2			$	9.3		20.1	%		26.9	%
		Staffing fee-based income included in revenue from services			2.0				2.1		(6.3	)		(2.2	)
		Gross profit			3.3				3.5		(4.6	)		0.2
		Gross profit rate			29.9	%			37.7	%	(7.8	)	pts.
	Total APAC
		Revenue from services		$	102.5			$	96.6		6.1	%		11.4	%
		Staffing fee-based income included in revenue from services			4.0				4.3		(6.6	)		(2.8	)
		Gross profit			15.1				16.0		(5.2	)		(0.6	)
		Total SG&A expenses			13.1				14.7		(11.4	)		(6.8	)
		Earnings from operations			2.0				1.3		63.9
		Gross profit rate			14.8	%			16.5	%	(1.7	)	pts.
		Expense rates:
			% of revenue		12.7				15.2		(2.5	)
			% of gross profit		85.8				91.8		(6.0	)
		Return on sales			2.1				1.4		0.7
OCG
		Revenue from services		$	164.7			$	148.5		10.9	%		11.9	%
		Gross profit			42.3				36.5		15.8			17.1
		Total SG&A expenses			32.6				29.0		12.5			14.8
		Earnings from operations			9.7				7.5		28.5
		Gross profit rate			25.6	%			24.6	%	1.0		pts.
		Expense rates:
			% of revenue		19.8				19.6		0.2
			% of gross profit		77.4				79.6		(2.2	)
		Return on sales			5.8				5.0		0.8

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)
				December Year to Date
														Constant
														Currency
				2014				2013			Change			Change
AMERICAS
	Commercial
		Revenue from services		$	2,609.6			$	2,545.6		2.5	%		3.4	%
		Staffing fee-based income included in revenue from services			14.4				13.2		8.7			10.1
		Gross profit			379.6				370.2		2.6			3.4
		Gross profit rate			14.5	%			14.5	%	-		pts.
	PT
		Revenue from services		$	956.0			$	967.8		(1.2)	%		(1.0)	%
		Staffing fee-based income included in revenue from services			15.6				14.5		7.4			8.1
		Gross profit			155.9				155.1		0.6			0.8
		Gross profit rate			16.3	%			16.0	%	0.3		pts.
	Total Americas
		Revenue from services		$	3,565.6			$	3,513.4		1.5	%		2.2	%
		Staffing fee-based income included in revenue from services			30.0				27.7		8.0			9.1
		Gross profit			535.5				525.3		2.0			2.6
		Total SG&A expenses			446.8				419.8		6.5			7.1
		Earnings from operations			88.7				105.5		(15.9	)
		Gross profit rate			15.0	%			14.9	%	0.1		pts.
		Expense rates:
			% of revenue		12.5				11.9		0.6
			% of gross profit		83.5				79.9		3.6
		Return on sales			2.5				3.0		(0.5	)
EMEA
	Commercial
		Revenue from services		$	894.7			$	877.5		2.0	%		3.5	%
		Staffing fee-based income included in revenue from services			17.3				19.8		(12.5	)		(8.0	)
		Gross profit			130.6				133.6		(2.3	)		(0.6	)
		Gross profit rate			14.6	%			15.2	%	(0.6	)	pts.
	PT
		Revenue from services		$	190.3			$	179.7		5.9	%		6.4	%
		Staffing fee-based income included in revenue from services			13.5				15.0		(10.0	)		(6.4	)
		Gross profit			42.9				42.6		0.7			2.2
		Gross profit rate			22.6	%			23.7	%	(1.1	)	pts.
	Total EMEA
		Revenue from services		$	1,085.0			$	1,057.2		2.6	%		4.0	%
		Staffing fee-based income included in revenue from services			30.8				34.8		(11.4	)		(7.3	)
		Gross profit			173.5				176.2		(1.6	)		0.1
		SG&A expenses excluding restructuring charges			160.6				164.3		(2.3	)
		Restructuring charges			0.8				0.4		60.5
		Total SG&A expenses			161.4				164.7		(2.1	)		(0.1	)
		Earnings from operations			12.1				11.5		5.5
		Earnings from operations excluding restructuring charges			12.9				11.9		7.9
		Gross profit rate			16.0	%			16.7	%	(0.7	)	pts.
		Expense rates (excluding restructuring charges):
			% of revenue		14.8				15.5		(0.7	)
			% of gross profit		92.5				93.2		(0.7	)
		Return on sales (excluding restructuring charges)			1.2				1.1		0.1

KELLY SERVICES, INC. AND SUBSIDIARIES
RESULTS OF OPERATIONS BY SEGMENT
(UNAUDITED)
(In millions of dollars)
					December Year to Date
															Constant
															Currency
					2014				2013			Change			Change
APAC
	Commercial
		Revenue from services			$	351.8			$	344.1		2.2	%		5.6	%
		Staffing fee-based income included in revenue from services				7.9				9.2		(14.7	)		(11.5	)
		Gross profit				47.5				49.3		(3.7	)		(0.4	)
		Gross profit rate				13.5	%			14.3	%	(0.8	)	pts.
	PT
		Revenue from services			$	40.4			$	38.6		4.5	%		9.0	%
		Staffing fee-based income included in revenue from services				7.8				8.8		(11.4	)		(7.9	)
		Gross profit				12.7				14.0		(8.8	)		(5.0	)
		Gross profit rate				31.6	%			36.2	%	(4.6	)	pts.
	Total APAC
		Revenue from services			$	392.2			$	382.7		2.5	%		6.0	%
		Staffing fee-based income included in revenue from services				15.7				18.0		(13.1	)		(9.8	)
		Gross profit				60.2				63.3		(4.8	)		(1.4	)
		SG&A expenses excluding restructuring charges				56.4				60.2		(6.3	)
		Restructuring charges				1.3				0.3		373.4
		Total SG&A expenses				57.7				60.5		(4.5	)		(0.8	)
		Earnings from operations				2.5				2.8		(11.0	)
		Earnings from operations excluding restructuring charges				3.8				3.1		24.7
		Gross profit rate				15.4	%			16.5	%	(1.1	)	pts.
		Expense rates (excluding restructuring charges):
			% of revenue			14.4				15.7		(1.3	)
			% of gross profit			93.6				95.1		(1.5	)
		Return on sales (excluding restructuring charges)				1.0				0.8		0.2
OCG
		Revenue from services			$	586.8			$	509.5		15.2	%		15.7	%
		Gross profit				143.6				128.2		12.0			12.4
		SG&A expenses excluding restructuring charges				127.3				110.6		15.1
		Restructuring charges				-				0.9		(100.0	)
		Total SG&A expenses				127.3				111.5		14.3			15.0
		Asset impairments				-				1.7		(100.0	)
		Earnings from operations				16.3				15.0		7.3
		Earnings from operations excluding restructuring charges				16.3				15.9		1.8
		Gross profit rate				24.5	%			25.2	%	(0.7	)	pts.
		Expense rates (excluding restructuring charges):
			% of revenue			21.7				21.7		-
			% of gross profit			88.7				86.3		2.4
		Return on sales (excluding restructuring charges)				2.8				3.1		(0.3	)

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(In millions of dollars)
			Dec. 28, 2014				Dec. 29, 2013
Current Assets
	Cash and equivalents		$	83.1			$	125.7
	Trade accounts receivable, less allowances of $10.7 and $9.9, respectively			1,122.8				1,023.1
	Prepaid expenses and other current assets			47.9				52.2
	Deferred taxes			34.4				35.5
	Total current assets			1,288.2				1,236.5
Property and Equipment, Net				93.0				92.0
Noncurrent Deferred Taxes				146.3				121.7
Goodwill, Net				90.3				90.3
Other Assets				300.1				258.1
Total Assets			$	1,917.9			$	1,798.6
Current Liabilities
	Short-term borrowings		$	91.9			$	28.3
	Accounts payable and accrued liabilities			364.0				342.4
	Accrued payroll and related taxes			308.5				294.9
	Accrued insurance			26.9				27.6
	Income and other taxes			68.8				68.8
Total current liabilities				860.1				762.0
Noncurrent Liabilities
	Accrued insurance			43.9				46.0
	Accrued retirement benefits			140.8				134.7
	Other long-term liabilities			39.4				33.3
Total noncurrent liabilities				224.1				214.0
Stockholders' Equity
	Common stock			40.1				40.1
	Treasury stock			(49.8	)			(56.2	)
	Paid-in capital			24.9				26.0
	Earnings invested in the business			767.4				751.3
	Accumulated other comprehensive income			51.1				61.4
Total stockholders' equity				833.7				822.6
Total Liabilities and Stockholders' Equity			$	1,917.9			$	1,798.6
STATISTICS:
Working Capital			$	428.1			$	474.5
Current Ratio				1.5				1.6
Debt-to-capital %				9.9	%			3.3	%
Global Days Sales Outstanding				54				52

KELLY SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE 52 WEEKS ENDED DECEMBER 28, 2014 AND DECEMBER 29, 2013
(UNAUDITED)
(In millions of dollars)
				2014				2013
Cash flows from operating activities:
	Net earnings			$	23.7			$	58.9
	Noncash adjustments:
		Impairment of assets			-				1.7
		Depreciation and amortization			21.7				20.4
		Provision for bad debts			5.3				2.0
		Stock-based compensation			5.3				3.8
		Other, net			(0.4	)			0.6
	Changes in operating assets and liabilities				(125.6	)			27.9
		Net cash (used in) from operating activities			(70.0	)			115.3
Cash flows from investing activities:
	Capital expenditures				(21.7	)			(20.0	)
	Investment in equity affiliate				(5.7	)			-
	Other investing activities				0.2				(0.8	)
		Net cash used in investing activities			(27.2	)			(20.8	)
Cash flows from financing activities:
	Net change in short-term borrowings				63.9				(35.8	)
	Dividend payments				(7.6	)			(7.6	)
	Other financing activities				0.3				(0.3	)
		Net cash from (used in) financing activities			56.6				(43.7	)
Effect of exchange rates on cash and equivalents					(2.0	)			(1.4	)
Net change in cash and equivalents					(42.6	)			49.4
Cash and equivalents at beginning of period					125.7				76.3
Cash and equivalents at end of period				$	83.1			$	125.7

KELLY SERVICES, INC. AND SUBSIDIARIES
REVENUE FROM SERVICES
(UNAUDITED)
(In millions of dollars)
		Fourth Quarter (Commercial, PT and OCG)
								% Change
											Constant
		2014			2013			US$			Currency
Americas
	United States	$	933.9		$	872.6		7.0	%		7.0	%
	Canada		50.0			52.4		(4.5	)		3.2
	Mexico		36.7			33.9		8.2			15.2
	Puerto Rico		26.6			24.6		8.3			8.3
	Brazil		13.9			14.0		(0.6	)		7.6
Total Americas			1,061.1			997.5		6.4			7.1
EMEA
	France		66.4			66.1		0.4			9.2
	Switzerland		57.8			70.3		(17.9	)		(12.7	)
	Portugal		32.4			27.3		18.9			29.4
	United Kingdom		23.2			27.2		(14.7	)		(13.0	)
	Russia		20.9			33.0		(36.6	)		(9.3	)
	Germany		16.8			17.5		(4.1	)		4.2
	Italy		13.9			15.3		(8.7	)		(0.8	)
	Norway		11.9			14.8		(19.9	)		(9.8	)
	Other		13.6			16.9		(19.4	)		(12.0	)
Total EMEA			256.9			288.4		(10.9	)		(1.5	)
APAC
	Singapore		32.7			30.6		7.0			10.8
	Australia		32.6			30.2		7.9			16.8
	Malaysia		16.2			16.1		0.6			5.4
	New Zealand		13.2			14.0		(6.1	)		(0.6	)
	Other		12.3			9.0		37.1			37.5
Total APAC			107.0			99.9		7.1			12.6
Total Kelly Services, Inc.		$	1,425.0		$	1,385.8		2.8	%		5.7	%

KELLY SERVICES, INC. AND SUBSIDIARIES
REVENUE FROM SERVICES
(UNAUDITED)
(In millions of dollars)
		December Year to Date (Commercial, PT and OCG)
								% Change
											Constant
		2014			2013			US$			Currency
Americas
	United States	$	3,535.8		$	3,419.9		3.4	%		3.4	%
	Canada		198.2			216.3		(8.4	)		(1.9	)
	Mexico		139.0			133.3		4.3			8.7
	Puerto Rico		105.0			98.2		6.9			6.9
	Brazil		57.1			59.0		(3.2	)		5.8
Total Americas			4,035.1			3,926.7		2.8			3.4
EMEA
	France		268.6			248.1		8.3			8.3
	Switzerland		253.5			255.9		(0.9	)		(2.5	)
	Portugal		124.8			90.3		38.2			38.5
	Russia		117.3			135.0		(13.1	)		2.2
	United Kingdom		105.6			105.3		0.3			(5.1	)
	Germany		67.5			66.8		1.1			1.2
	Italy		60.2			58.9		2.2			1.9
	Norway		55.5			61.1		(9.2	)		(3.2	)
	Other		64.5			67.6		(4.6	)		(4.4	)
Total EMEA			1,117.5			1,089.0		2.6			4.0
APAC
	Singapore		127.5			114.1		11.8			13.2
	Australia		121.4			130.6		(7.1	)		(0.7	)
	Malaysia		66.2			67.2		(1.4	)		2.4
	New Zealand		51.4			50.1		2.5			1.4
	Other		43.6			35.4		23.2			30.2
Total APAC			410.1			397.4		3.2			6.8
Total Kelly Services, Inc.		$	5,562.7		$	5,413.1		2.8	%		3.8	%

KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
FOR THE 13 WEEKS ENDED DECEMBER 28, 2014 AND DECEMBER 29, 2013
(UNAUDITED)
(In millions of dollars except per share data)
		2014												2013
		As reported				Restructuring Charges (Note 1)				Adjusted Earnings				Adjusted Earnings				% Change
Revenue from services		$	1,425.0			$	-			$	1,425.0			$	1,385.8			2.8	%
Cost of services			1,192.4				-				1,192.4				1,154.3			3.3
Gross profit			232.6				-				232.6				231.5			0.5
SG&A expenses			230.0				(6.2	)			223.8				221.6			1.1
Earnings from operations			2.6				6.2				8.8				9.9			(9.7	)
Other expense, net			1.1				-				1.1				0.6			89.6
Earnings before taxes			1.5				6.2				7.7				9.3			(15.7	)
Inc. tax (benefit) expense*			(15.5	)			2.4				(13.1	)			(8.2	)		(60.2	)
Net earnings		$	17.0			$	3.8			$	20.8			$	17.5			19.8	%
Earnings per share:
	Basic	$	0.44			$	0.10			$	0.54			$	0.45			20.0	%
	Diluted	$	0.44			$	0.10			$	0.54			$	0.45			20.0	%
* Income tax benefit for the fourth quarter of 2014 includes $13.6 million related to the retroactive reinstatement of work opportunity credits for the entire year.
		2013
		As reported				Restructuring Charges (Note 1)				Adjusted Earnings
Revenue from services		$	1,385.8			$	-			$	1,385.8
Cost of services			1,154.3				-				1,154.3
Gross profit			231.5				-				231.5
SG&A expenses			221.9				(0.3	)			221.6
Earnings from operations			9.6				0.3				9.9
Other expense, net			0.6				-				0.6
Earnings before taxes			9.0				0.3				9.3
Inc. tax (benefit) expense			(8.2	)			-				(8.2	)
Net earnings		$	17.2			$	0.3			$	17.5
Earnings per share:
	Basic	$	0.45			$	0.01			$	0.45
	Diluted	$	0.45			$	0.01			$	0.45
Note: Earnings per share amounts for each quarter are required to be computed independently and may not equal the amounts computed for the total year.

KELLY SERVICES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
FOR THE 52 WEEKS ENDED DECEMBER 28, 2014 AND DECEMBER 29, 2013
(UNAUDITED)
(In millions of dollars except per share data)
		2014												2013
		As reported				Restructuring Charges (Note 1)				Adjusted Earnings				Adjusted Earnings				% Change
Revenue from services		$	5,562.7			$	-			$	5,562.7			$	5,413.1			2.8	%
Cost of services			4,654.3				-				4,654.3				4,523.6			2.9
Gross profit			908.4				-				908.4				889.5			2.1
SG&A expenses			886.5				(12.0	)			874.5				832.9			5.0
Earnings from operations			21.9				12.0				33.9				56.6			(40.2	)
Other expense, net			5.3				-				5.3				4.5			15.3
Earnings before taxes			16.6				12.0				28.6				52.1			(45.0	)
Inc. tax (benefit) expense			(7.1	)			4.5				(2.6	)			(10.0	)		74.0
Net earnings		$	23.7			$	7.5			$	31.2			$	62.1			(49.7)	%
Earnings per share:
	Basic	$	0.61			$	0.19			$	0.81			$	1.62			(50.0	)%
	Diluted	$	0.61			$	0.19			$	0.81			$	1.62			(50.0	)%
		2013
		As reported				Restructuring Charges (Note 1)				Asset Impairments (Note 2)				Adjusted Earnings
Revenue from services		$	5,413.1			$	-			$	-			$	5,413.1
Cost of services			4,523.6				-				-				4,523.6
Gross profit			889.5				-				-				889.5
SG&A expenses			834.5				(1.6	)			-				832.9
Asset impairments			1.7				-				(1.7	)			-
Earnings from operations			53.3				1.6				1.7				56.6
Other expense, net			4.5				-				-				4.5
Earnings before taxes			48.8				1.6				1.7				52.1
Inc. tax (benefit) expense			(10.1	)			0.1				-				(10.0	)
Net earnings		$	58.9			$	1.5			$	1.7			$	62.1
Earnings per share:
	Basic	$	1.54			$	0.04			$	0.04			$	1.62
	Diluted	$	1.54			$	0.04			$	0.04			$	1.62
Note: Earnings per share amounts for each quarter are required to be computed independently and may not equal the amounts computed for the total year.

KELLY SERIVCES, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP MEASURES

(UNAUDITED)

Management believes that the non-GAAP (Generally Accepted Accounting Principles) information excluding the restructuring charges and asset impairment charges is useful to understand the Company's fiscal 2014 financial performance and increases comparability. Specifically, Management believes that excluding these items allows for a more meaningful comparison of current period operating performance with the operating results of prior periods. These non-GAAP measures may have limitations as analytical tools because they exclude items which can have a material impact on cash flow and earnings per share. As a result, Management considers these measures, along with reported results, when it reviews and evaluates the Company's financial performance. Management believes that these measures provide greater transparency to investors and provide insight into how Management is evaluating the Company's financial performance. Non-GAAP measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.

(1) Restructuring charges in 2014 includes costs related to the U.S. management simplification restructuring plan, costs incurred for exiting the staffing business in Sweden, and costs related to closing branches in Australia and consolidating back office functions in Australia and New Zealand. Restructuring charges in 2013 relate to the Company's decision to exit the executive search business operating in Germany, and primarily relate to severance costs from exiting this business.

(2) Asset impairment charges represent the write-off of the carrying value of long-lived assets related to the decision to exit the executive search business operating in Germany.