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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934: For the fiscal year ended December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File No. 1-10686
MANPOWER INC.
(Exact name of registrant as specified in its charter)
WISCONSIN 39-1672779
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5301 NORTH IRONWOOD ROAD
MILWAUKEE, WISCONSIN 53217
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (414) 961-1000
Securities registered pursuant to Section 12(b) of the Act:
Name of Exchange on
Title of each class which registered
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Common Stock, $.01 par value New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: NONE
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
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Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
The aggregate market value of the voting stock held by nonaffiliates
of the registrant was $3,094,502,451 as of February 25, 1997. As of February
25, 1997, there were 81,703,035 of the registrant's shares of common stock
outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Part I and Part II incorporate information by reference to the Annual
Report to Shareholders for the fiscal year ended December 31, 1996. Part III
is incorporated by reference from the Proxy Statement for the Annual Meeting of
Shareholders to be held on April 28, 1997.
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PART I
ITEM 1. BUSINESS
Introduction and History
Manpower Inc. (the "Company") is the largest non-governmental
employment services organization in the world,1 with over 2,500 offices in 43
countries. The Company's largest operations, based on revenues, are located in
the United States, France and the United Kingdom. The Company is primarily
engaged in temporary help, contract services and training and testing of
temporary and permanent workers. The Company provides employment services to a
wide variety of customers, none of which individually comprise a significant
portion of revenues within a given geographic region or for the Company as a
whole. Unless the context requires otherwise, references to the Company
include its subsidiaries.
The Company was organized in 1991 as a holding company to acquire
Manpower International Inc. ("Manpower"). Manpower, subsequently renamed
Manpower Wisconsin Inc., was the primary operating subsidiary of the Company
until June 30, 1996, when it was merged into the Company. The predecessor of
Manpower was organized in 1948 and its shares were listed on the New York Stock
Exchange (the "NYSE") in 1962.
The Company's principal executive offices are located at 5301 North
Ironwood Road, Milwaukee, Wisconsin 53217 (telephone: 414-961-1000).
THE COMPANY'S OPERATIONS - MANPOWER
United States
In the United States, the Company's operations are carried out through
both branch (i.e., Company-owned) and franchise offices. The Company had 653
branch and 458 franchise offices in the United States at December 31, 1996.
The Company provides a number of central support services to its branches and
franchises which enable it to maintain consistent service quality throughout
the United States regardless of whether an office is a branch or franchise.
The Company has developed a comprehensive system of assessment/selection,
training and quality assurance for its temporary help operations. All
assessment/selection, training and support materials are designed and produced
by the Company for both branches and franchises. In addition, the Company
conducts a series of training classes for all employees of both branches and
franchises, including training classes for service representatives and branch
managers, at its Milwaukee headquarters. The Company provides customer
invoicing and payroll processing of its temporary employees for all branch
offices and virtually all franchise offices through its Milwaukee headquarters.
The Company's franchise agreement provides the franchisee with the
right to use the Manpower(R) service mark and associated marks in a
specifically defined exclusive territory. U.S. franchise fees range from 2-3%
of franchise sales. The Company's franchise agreement provides that in the
event of a proposed sale of a franchise to a third party, the Company has the
right to repurchase the franchise at the same price and on the same terms as
proposed by the third party. The Company frequently exercises this right and
intends to continue to do so in the future if opportunities arise with
appropriate prices and terms.
In the United States, the Company's operations are primarily related
to providing temporary employment services. During 1996, approximately 39% of
the Company's United States temporary help revenues were derived from placing
office workers, 41% from placing industrial workers and 20% from placing
technical and other workers.
____________________
1 Based on publicly available information, including annual reports to
shareholders, filings with governmental agencies and investment analyst
reports.
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France
The Company is the second largest temporary employment service
provider in France (see footnote 1 on page 1). The Company conducts its
operations in France through over 646 branch offices.
The temporary services market in France is predominately industrial.
In 1996, the Company derived approximately 72% of its revenue in France from
the industrial sector, 14% from the construction sector and 14% from the office
sector.
United Kingdom
The Company is the largest supplier of temporary employment services
in the United Kingdom (see footnote 1 on page 1). As of December 31, 1996, it
conducted operations in the United Kingdom through 156 branch offices.
The Company uses the same approach to selection assessment, training
and marketing programs in the United Kingdom as it uses in the United States
with such modifications as necessary to reflect differences in language,
culture and business practices. Ultraskill, the Company's proprietary program
for assessing the word processing skills of its temporary workers, has received
endorsement from the Royal Society of Arts, one of the world's foremost
qualification standards for office skills. Candidates whose results exceed
prescribed levels can be automatically certified through the RSA. The Company
was the first temporary help company to be registered under BS5750-IS09000, the
international quality assurance standard.
In the United Kingdom, the Company offers temporary employment
services in the office, industrial, technical, information technology, nursing
and transport markets. It also offers a variety of specialized services
targeted at the health sector and local government which consist of specialized
assessment, selection and training, as well as the supply of specialized staff.
The Company is also the leading company in the United Kingdom for the provision
of managed services, project work and subcontracted activities.
During 1996, approximately 49% of the Company's revenues were derived
from the supply of office staff, 31% from the supply of industrial/technical
staff, 7% from the supply of information technology staff, 7% from the supply
of nursing staff and 6% from the supply of drivers.
Other Europe
The Company operates through 244 branch offices and 51 franchise
offices in other European countries. The largest operations are located in
Belgium, Denmark, Germany, The Netherlands, Norway, Spain and Sweden, all of
which are branch offices, and Switzerland, which is a 49% owned franchise. The
Company is the largest non-governmental temporary employment services firm in
the European Economic Community (see footnote 1 on page 1). The Company
utilizes the same approach to selection, training, recruiting and marketing
techniques in continental Europe as are used in the United States with such
modifications as may be appropriate for local legal requirements, cultural
characteristics and business practices.
Other Markets of the World
The Company operates through 157 branch offices and 63 franchise
offices in the other markets of the world. The largest of these operations are
located in Japan (27 branch offices) and Israel (44 branch offices). Other
significant operations are located in Australia, Canada and Mexico and in 9
South American countries. The Company uses the same general approach to
testing, training and marketing tools in other areas of the world as employed
in the United States with such modifications as may be appropriate for local
cultural differences and business practices. In most of these countries, the
Company primarily supplies temporary workers to the industrial, general office
and technical markets.
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THE COMPANY'S OTHER OPERATIONS
The Company also owns Brook Street Bureau PLC which operates separate
from the Manpower brand exclusively in the United Kingdom. Brook Street Bureau
PLC, acquired by the Company in 1985, has a total of 91 branches in England,
Scotland and Wales. It provides services in the office, industrial and
catering markets. In 1996, approximately 90% of its revenues were derived from
temporary placements and 10% were derived from permanent placement. Brook
Street Bureau PLC competes in certain U.K. markets with the Company's Manpower
brand. Its permanent placement business primarily consists of recruitment for
office workers.
COMPETITION
Historically, in periods of economic prosperity, the number of firms
operating in the temporary help industry has increased significantly due to the
combination of a favorable economic climate and low barriers to entry.
Recessionary periods, such as that experienced in the United States and United
Kingdom in the early 1990s, result in a reduction in competition through
consolidation and closures. However, historically this reduction has proven to
be of a limited duration as the following periods of economic recovery have led
to a return to growth in the number of competitors operating in the industry.
The temporary employment services market throughout the world is
highly competitive and highly fragmented with more than 15,000 firms competing
in the industry throughout the world. In addition to the Company, the largest
publicly owned companies (the only companies about which financial information
is readily available) specializing in temporary employment services are Adecco
S.A. (Switzerland), Kelly Services, Inc. (U.S.), The Olsten Corporation (U.S.),
Randstad Holding N.V. (Holland), BIS S.A. (France), Pasona (Japan), and Interim
Services, Inc. (U.S.). However, except for Adecco, S.A. these companies all
operate primarily in their country of origin, with only small operations in a
limited number of other markets.
In the temporary help industry, competition is limited to firms with
offices located within a customer's particular local market because temporary
employees generally are unwilling to travel long distances. In most major
markets, competitors generally include many of the publicly traded companies,
and in addition, numerous regional and local competitors, some of which may
operate only in a single market. Competition may also be provided by
governmental entities, such as state employment offices in the United Kingdom
and many European countries.
Since client companies rely on temporary employment firms having
offices within the local area in which they operate, competition varies from
market-to-market and country-to-country. In most areas, no single company has
a dominant share of the market. Many client companies use more than one
temporary employment services provider; however, in recent years, the practice
of using a sole temporary supplier or a primary supplier has become an
increasingly important factor among the largest customers, particularly in the
United States and the United Kingdom. These sole supplier relationships can
have a significant impact on the Company's revenue and operating profit growth.
The Company's strategy is to build its large account business, including sole
supplier relationships. While the Company believes that these large account
relationships will prove to be less cyclical in the long-term than its
traditional business, volume reductions by such customers, whether related to
economic factors or otherwise, could have a material adverse effect on the
Company's results in any period.
Methods of Competition
Temporary help firms act as intermediaries in matching available
temporary workers to employer assignments. As a result, temporary help firms
compete both to recruit and retain a supply of workers and to attract customers
to use temporary employees. Competition is generally limited to firms having
offices located in a specific local geographic market. Depending on the
economy of a particular market at any point in time, it may be necessary to
place greater emphasis on recruitment and retention of temporaries or marketing
to customers. The Company recruits temporary workers through a wide variety of
means, principally personal referrals and advertisements, and by providing an
attractive compensation package, including health insurance, vacation and
holiday pay, incentive plans and a recognition program.
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Methods used to market temporary services to customers vary depending
on the customer's perceived need for temporary workers, the local labor supply,
the length of assignment and the number of workers required. Depending on
these factors, the Company competes by means of quality of service provided,
scope of service offered and price. In the temporary help industry, quality is
measured primarily by the ability to effectively match an individual worker to
a specific assignment, as well as promptness in filling an order. Success in
providing a high quality service is a function of the ability to access a large
supply of available temporary workers, select suitable individuals for a
particular assignment and, in some cases, train available workers in skills
required for an assignment.
An important aspect in the selection of a temporary worker for an
assignment is the ability of the temporary services firm to identify the
skills, knowledge, abilities, and personal characteristics of a temporary
worker and match their competencies or capabilities to an employer's
requirements. The Company has developed a variety of proprietary programs for
identifying and assessing skill levels of its temporary workers, including
Ultraskill(R) (for word processing skills), UltradexO (for several important
light industrial skills) and Predicta (for critical general office skills)
which are used in selecting a particular individual for a specific assignment.
The Company believes that its assessment systems enable it to offer a higher
quality service by increasing productivity, decreasing turnover and reducing
absenteeism. The Company believes it is the only temporary employment firm
whose employee selection systems have been statistically validated in full or
complete accordance with the guidelines established by the Equal Employment
Opportunity Commission and standards set forth by the American Psychological
Association in the United States and similar authorities in various other
countries. In the United Kingdom, candidates whose test results on
Ultraskill(R) exceed prescribed levels are automatically certified through the
Royal Society of Arts, one of the world's best known qualification standards
for word processing skills.
It is also important to be able to access a large network of skilled
workers and to be able to "create" certain hard-to-find skills by offering
training to available workers. The Company's competitive position is enhanced
by being able to offer a wide variety of skills in one of the most important
market segments for temporary work, the office automation market, through the
use of a proprietary training system. This system, called Skillware(R), allows
temporary workers to quickly and conveniently learn new or enhance existing
office automation skills in a variety of word processing, data base,
spreadsheet, data entry or graphics applications from a variety of the most
popular software manufacturers including Microsoft and Lotus. Skillware(R) is
a hands-on, disk-based training program enabling workers to train on the actual
hardware and software to be utilized on an assignment. The Skillware(R) system
combines the human elements of classroom instruction with the self-paced
work-related aspects of a disk-based system. A Skillware(R) Administrator sets
up the training, monitors all sessions and is available to answer questions.
The Company supports over 150 different software programs through Skillware(R)
for the equipment of a wide variety of hardware manufacturers, including IBM
compatibles (PCs, mid-range and mainframes), Apple and DEC. New Skillware(R)
is constantly developed or revised as new or updated hardware or software
programs are introduced. The Company's offices maintain a variety of hardware
and software commonly used in their local market. Every person completing a
Skillware(R) course receives an Operator Support Manual and keyboard template
which serves as an on-the-job reference and refresher.
The Company also offers a variety of specific skill development
programs in spelling, punctuation, keyboard skills and word processing to
assist its temporaries in improving general office skills.
The Company has partnered with CBT Systems to develop TechTrack, a
CD-based training program for technical professionals. TechTrack is an
interactive, self-directed training program which enhances technical employees'
skills to meet the current and emerging demands of the business environment.
TechTrack offers a spectrum of instruction focusing on client/server,
networking and operating systems technologies. The training prepares technical
employees for certification testing by guiding them through Visual Basic, C++
Programming, PowerBuilder, IEEE LAN Architecture and more than 200 other
courses.
Although temporary help firms compete in a local market, for
administrative purposes, the largest customers demand national, and
increasingly global, arrangements. Less than 5% of the Company's sales in 1996
were derived
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from global arrangements, but approximately 50% of the Company's sales in 1996
were derived from national arrangements. A large national or multi-national
company will frequently enter into non-exclusive arrangements with several
firms, with the ultimate choice among them being left to its local managers;
this effectively limits competition to the few firms, including the Company,
with large branch networks.
The Company also competes in the large company market by providing
permanent staff training using its Skillware(R) training capability, widespread
office network and large temporary work force, to train the permanent employees
of large companies, particularly in new word or data processing software
programs or hardware configurations. Of the Fortune 100 companies, 90 have
utilized Skillware training for their permanent staff. The Company believes
its capability to offer permanent staff training, in addition to generating
sufficient revenue to offset development costs, provides it with a key
marketing advantage over its competitors in supplying temporary help to
companies where it has been involved in significant staff training.
Beginning in 1994 the Company began delivering to all workers - both
its permanent employees and temporary staff - a training program that focuses
on providing exceptional service. Called Putting Quality to Work, this series
of eight independent video programs introduces concepts that will influence
workers' attitudes and behavior, with an emphasis on providing better service
to a company's customers and providing support to co-workers.
REGULATION
The temporary employment services industry is closely regulated in all
of the major markets in which the Company operates except the United States and
Canada. Temporary employment service firms are generally subject to one or
more of the following types of government regulation: (i) regulation of the
employer/employee relationship between the firm and its temporary employees;
(ii) registration, licensing, record keeping and reporting requirements; and
(iii) substantive limitations on its operations.
In many markets, the existence or absence of collective bargaining
agreements with labor organizations has a significant impact on the Company's
operations and the ability of customers to use the Company's services. In some
markets, labor agreements are structured on an industry-wide (rather than
Company) basis. Changes in these collective labor agreements have occurred in
the past and are expected to occur in the future and may have a material impact
on the operations of temporary employment services firms, including the
Company.
In many countries, including the United States, temporary employment
services firms are considered the legal employers of temporary workers.
Therefore, the firm is governed by laws regulating the employer/employee
relationship, such as tax withholding or reporting, social security or
retirement, anti-discrimination and workers' compensation. In other countries,
temporary employment services firms, while not the direct legal employer of
temporary workers, are still responsible for collecting taxes and social
security deductions and transmitting such amounts to the taxing authorities.
In many countries, particularly in continental Europe, entry into the
temporary employment market is restricted by the requirement to register with,
or obtain licenses from, a government agency. In addition, a wide variety of
ministerial requirements may be imposed, such as record keeping, written
contracts and reporting. The United States and Canada do not presently have
any form of national registration or licensing requirement.
In addition to licensing or registration requirements, many countries
impose substantive restrictions on temporary employment services. Such
restrictions include regulations affecting the types of work permitted (e.g.,
Germany prohibits the use of temporary workers in construction work and Japan
and Norway generally prohibit the use of temporary workers in industrial work),
the maximum length of a temporary assignment (varying from 3 to 24 months),
wage levels (e.g., in France, wages paid to temporaries must be the same as
paid to permanent workers) or reasons for which temporary workers may be
employed. In some countries special taxes, fees or costs are imposed in
connection with the use of temporary workers. For example, in France,
temporary workers are entitled to a 15% allowance for the precarious nature of
employment which is reduced to 10% if a new assignment is offered to them
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within three days. In some countries, the contract of employment with the
temporary employee must differ from the length of assignment.
In the United States, the Company is subject to various federal and
state laws relating to franchising, principally the Federal Trade Commission's
franchise rules and analogous state laws. These laws and related rules and
regulations impose specific disclosure requirements to prospective franchisees.
Virtually all states also regulate the termination of franchises. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations - Legal Regulations and Union Relationships" which is found in the
Company's 1996 Annual Report to Shareholders and which is incorporated herein
by reference.
TRADEMARKS
The Company maintains a number of trademarks, tradenames, service
marks and other intangible rights. The principal service marks are the
Manpower(R) service mark and logo, Ultraskill(R), Skillware(R) and certain
other names and logos, which are registered in the United States and certain
other countries. The trademark Manpower(R) has been federally registered under
United States Service Mark Registration No. 921701, issued October 5, 1971.
Affidavits of use and incontestability have been filed. The Company renewed
this registration for another ten years on October 5, 1991. The mark
Skillware(R) has been federally registered under United States Trademark
Registration No. 1413105, issued October 14, 1986, and the mark Ultraskill(R)
has been federally registered under United States Trademark Registration No.
1361848, issued September 24, 1985. The Company plans to file affidavits of
use and incontestability at the proper time and will effect timely renewals, as
appropriate, for these and other intangible rights it maintains. The Company
is not currently aware of any infringing uses which would be likely to
substantially and detrimentally affect these rights.
RESEARCH AND DEVELOPMENT
The Company's research and development efforts are concentrated on the
development and updating of its Skillware(R) training and employee selection
programs. Approximately 23 employees are engaged in research and development
at the Company's international headquarters. Independent contractors are also
utilized to assist in the development of these tools. Expenditures for
research and development, which were internally financed, aggregated
approximately $4.3 million in 1996, 1995 and 1994.
EMPLOYEES
The Company had approximately 10,200 permanent full-time employees at
December 31, 1996. In addition, the Company estimates that it assigned over
1.6 million temporary workers on a worldwide basis in 1996. As described
above, in most jurisdictions, the Company (through its subsidiaries), as the
employer of its temporary workers or, as otherwise required by applicable law,
is responsible for employment administration, including collection of
withholding taxes, employer contributions for social security (or its
equivalent outside the United States), unemployment tax, workers' compensation
and fidelity and liability insurance, and other governmental requirements
imposed on employers. In most jurisdictions where such benefits are not
legally required, including the United States, the Company provides health and
life insurance, paid holidays and paid vacations to qualifying temporary
employees.
FINANCIAL INFORMATION ABOUT FOREIGN AND DOMESTIC
OPERATIONS AND EXPORT SALES
Note 12 to the Company's Consolidated Financial Statements sets forth
the revenues, earnings before income taxes, identifiable assets and net assets
derived from each geographical area for the years ended December 31, 1996, 1995
and 1994. Such note is found in the Company's 1996 Annual Report to
Shareholders and is incorporated herein by reference.
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ITEM 2. PROPERTIES
The Company's headquarters are in Glendale, Wisconsin, a suburb of
Milwaukee. The Company owns, free of any material encumbrances, its
headquarters, consisting of an 82,000 square foot building and a 32,000 square
foot building situated on a sixteen-acre site in Glendale, Wisconsin.
The Company owns two properties in England which are held for sale,
consisting of a 24,000 square foot freehold building in London and a 90,000
square foot freehold building in St._Albans, Hertfordshire. The Company also
owns additional properties in St._Albans and various other locations which are
not material.
Most of the Company's operations are conducted from leased premises,
none of which are material to the Company taken as a whole. The Company does
not anticipate any difficulty in renewing these leases or in finding
alternative sites in the ordinary course of business.
ITEM 3. LEGAL PROCEEDINGS
The Company is involved in litigation of a routine nature and various
legal matters which are being defended and handled in the ordinary course of
business.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
EXECUTIVE OFFICERS OF THE REGISTRANT
NAME OF OFFICER OFFICE
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Mitchell S. Fromstein President and Chief Executive Officer of the Company since January, 1989, and
Age 69 Chairman of the Board since April, 1989. President and Chief Executive
Officer of Manpower from 1976 until 1996 and a director thereof from 1971
until 1996. A director of the Company and its predecessors for more than
five years. Also a director of Aramark Corp.
Jon F. Chait Executive Vice President, Secretary and a director of the Company since
Age 46 August, 1991, Chief Financial Officer of the Company since August, 1993 and
Managing Director-International Operations since December, 1995. Executive
Vice President of Manpower from September, 1989 until 1996. Also a director
of Marshall & Ilsley Corporation.
Terry A. Hueneke Executive Vice President of the Company and a director since December, 1995.
Age 54 Senior Vice President - Group Executive of Manpower from 1987 until 1996.
Michael J. Van Handel Vice President, Chief Accounting Officer and Treasurer of the Company and
Age 37 Manpower since February, 1995. Vice President, International Accounting and
Internal Audit of Manpower from September, 1992 to February, 1995 and
Director of Internal Audit of Manpower prior thereto.
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PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
MARKET INFORMATION
The Company's Common Stock is listed for trading on the New York Stock
Exchange (the "NYSE"), which is the principal exchange for trading in the
Company's shares. The table below sets forth the reported high and low sales
price for shares of the Company's Common Stock on the NYSE during the indicated
quarters based on the NYSE Trading Report:
High Low
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Fiscal year ended December 31, 1996
First Quarter . . . . . . . . . . . . . . . . . . . . . . . . 34 1/4 23 5/8
Second Quarter . . . . . . . . . . . . . . . . . . . . . . . 43 29 1/2
Third Quarter . . . . . . . . . . . . . . . . . . . . . . . . 39 3/8 30
Fourth Quarter . . . . . . . . . . . . . . . . . . . . . . . 33 5/8 27 7/8
Fiscal year ended December 31, 1995
First Quarter . . . . . . . . . . . . . . . . . . . . . . . . 32 3/4 24 3/4
Second Quarter . . . . . . . . . . . . . . . . . . . . . . . 34 1/4 24 1/4
Third Quarter . . . . . . . . . . . . . . . . . . . . . . . . 33 3/8 25 3/8
Fourth Quarter . . . . . . . . . . . . . . . . . . . . . . . 31 1/8 24 1/8
HOLDERS
As of February 25, 1997, 81,703,035 shares of Common Stock were held
of record by 5,247 record holders.
HISTORICAL DIVIDENDS
The Company paid a dividend of $.07 per share in the second quarter
and $.08 per share in the fourth quarter of 1996. The Company paid a dividend
of $.06 per share in the second quarter and $.07 per share in the fourth
quarter of 1995.
ITEM 6. SELECTED FINANCIAL DATA
The information required by this Item is set forth in the Company's
Annual Report to Shareholders for the fiscal year ended December 31, 1996,
under the heading "Selected Financial Data," (page 24) which information is
hereby incorporated herein by reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The information required by this Item is set forth in the Company's
Annual Report to Shareholders for the fiscal year ended December 31, 1996,
under the heading "Management's Discussion and Analysis of Financial Condition
and Results of Operations," (pages 7 to 10) which information is hereby
incorporated herein by reference.
Certain information included or incorporated by reference in this
Annual Report on Form 10-K, including under the headings "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
"Business," information included or incorporated by reference in future filings
by the Company with the Securities and Exchange Commission or information
contained in written material, releases and oral statements issued by or on
behalf of the Company contain forward-looking statements as such term is
defined in Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Certain factors such as
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competitive market pressures, material changes in demand from larger customers,
including customers with which the Company has national or global arrangements,
availability of temporary workers, changes in customer attitudes toward
outsourcing, government policies adverse to the employment services industry
and changes in economic conditions could cause actual results to differ
materially from those in the forward-looking statements.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this Item is set forth in the Financial
Statements and the Notes thereto (pages 11 to 23) contained in the Company's
Annual Report to Shareholders for the fiscal year ended December 31, 1996,
which information is hereby incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
(a) Executive Officers. Reference is made to "Executive Officers
of the Registrant" in Part I after Item_4.
(b) Directors. The information required by this Item is set forth
in the Company's Proxy Statement for the Annual Meeting of
Shareholders to be held on April 28, 1997 at pages 3-4 under
the caption "Election of Directors," which information is
hereby incorporated herein by reference.
(c) Section 16 Compliance. The information required by this Item
is set forth in the Company's Proxy Statement for the Annual
Meeting of Shareholders to be held on April 28, 1997 at page
18 under the caption "Section 16(a) Beneficial Ownership
Reporting Compliance," which information is hereby
incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this Item is set forth in the Company's
Proxy Statement for the Annual Meeting of Shareholders to be held on April 28,
1997, at page 5 under the caption "Remuneration of Directors," pages 7-10 under
the caption "Executive Compensation," and page 12 under the caption "Executive
Compensation Committee Interlocks and Insider Participation," which information
is hereby incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required by this Item is set forth in the Company's
Proxy Statement for the Annual Meeting of Shareholders to be held on April 28,
1997, at page 2 under the caption "Security Ownership of Certain Beneficial
Owners" and at page 6 under the caption "Security Ownership of Management,"
which information is hereby incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this Item is set forth in the Company's
Proxy Statement for the Annual Meeting of Shareholders to be held on April 28,
1997, at page 5 under the caption "Remuneration of Directors" and at page 12
under the caption "Executive Compensation Committee Interlocks and Insider
Participation," which information is hereby incorporated herein by reference.
9
11
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a)(1) Financial Statements. PAGE NUMBER
IN ANNUAL
REPORT TO
SHAREHOLDERS
------------
Consolidated Financial Statements. (Data incorporated by reference from the
attached Annual Report to Shareholders):
Consolidated Balance Sheets as of December 31, 1996 and 1995 . . . . . 12-13
Consolidated Statements of Operations for the years ended 11
December 31, 1996, 1995 and 1994 . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Cash Flows for the years ended
December 31, 1996, 1995 and 1994 . . . . . . . . . . . . . . . . . . . 14
Consolidated Statements of Stockholders' Equity for the years
ended December 31, 1996, 1995 and 1994 . . . . . . . . . . . . . . . . 15
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . 16-22
(a)(2) Financial Statement Schedules.
Report of Independent Public Accountants on Financial Statement
Schedules Consent of Independent Public Accountants SCHEDULE II
- Valuation and Qualifying Accounts
(a)(3) Exhibits.
See (c) below.
(b) Reports on Form 8-K.
There were no reports on Form 8-K filed for the three months
ended December 31, 1996.
(c) Exhibits.
3.1 Articles of Incorporation of Manpower Inc. incorporated by
reference to Annex_C of the Prospectus which is contained in
Amendment No. 1 to Form S-4 (Registration No._33-38684).
3.2 Amended and Restated By-laws of Manpower Inc.
10.1 [Reserved]
10
12
10.2 Revolving Credit Agreement dated April 1, 1996, between Manpower Inc. and
the banks set forth therein, Credit Lyonnais, the First National Bank of
Chicago, Mellon Bank, N.A., Citibank International PLC and Citibank,
N.A., incorporated by reference to Form 10-Q of Manpower Inc. dated March
31, 1996.
10.3 Amended and Restated Manpower 1991 Executive Stock Option and Restricted
Stock Plan, incorporated by reference to Form 10-Q of Manpower Inc. dated
September 30, 1996.**
10.4 Manpower Savings Related Share Option Scheme, incorporated by reference
to Amendment No. 1 to the Company's Registration Statement on Form S-4
(Registration No. 33-38684).**
10.5 Transfer Agreement dated February 25, 1991 between Manpower and the
Company (the "Transfer Agreement"), incorporated by reference to
Amendment No. 1 to the Company's Registration Statement on Form S-4
(Registration No. 33-38684).**
10.6 Blue Arrow Savings Related Share Option Scheme, as assumed by Manpower
pursuant to the Transfer Agreement, incorporated by reference to
Amendment No. 1 to the Company's Registration Statement on Form S-4
(Registration No. 33-38684).**
10.7 Blue Arrow Executive Share Option Scheme, as assumed by Manpower pursuant
to the Transfer Agreement, incorporated by reference to Amendment No. 1
to the Company's Registration Statement on Form S-4 (Registration No.
33-38684).**
10.8 Amended and Restated Manpower 1990 Employee Stock Purchase Plan**
10.9 Manpower Retirement Plan, as amended and restated effective as of March
1, 1989, incorporated by reference to Form 10-K of Manpower PLC, SEC File
No. 0-9890, filed for the fiscal year ended October 31, 1989.**
10.10 Amended and Restated Manpower 1994 Executive Stock Option and Restricted
Stock Plan, incorporated by reference to Form 10-Q of Manpower Inc. dated
September 30, 1996.**
10.11(a) Employment Agreement dated September 16, 1987 among Manpower, Mitchell S.
Fromstein and Manpower PLC, incorporated by reference to the Manpower
PLC's registration statement on Form 20-F filed with the Securities and
Exchange Commission on April 28, 1988, [Exhibit 2.11]; as amended May 19,
1989, incorporated by reference to Manpower PLC's Form 10-K, SEC File No.
0-9890, filed for the fiscal year ended October 31, 1989; and as amended
on February 16, 1990 and October 4, 1990, incorporated by reference to
Manpower PLC's Form 10-K, SEC File No. 0-9890, filed for the fiscal year
ended December 31, 1990.**
10.11(b) Amendment dated June 17, 1992 to Employment Agreement dated September 16,
1987, as amended, among Manpower, Mitchell S. Fromstein and Manpower PLC,
incorporated by reference to the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1992.**
11
13
10.11(c) Amendment dated March 22, 1994 to Employment Agreement
dated September 16, 1987, as amended, among Manpower,
Mitchell S. Fromstein and Manpower PLC, incorporated by
reference to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995.**
10.12(a) Employment Agreement dated September 16, 1987 among Manpower, Gilbert
Palay and Manpower PLC, incorporated by reference to Manpower PLC's
registration statement on Form 20-F filed with the Securities and
Exchange Commission on May 1, 1989, incorporated by reference to Manpower
PLC's Form 10-K, SEC File No. 0-9890, filed for the fiscal year ended
October 31, 1989; and as amended on February 16, 1990 and October 4,
1990, incorporated by reference to Manpower PLC's Form 10-K, SEC File No.
0-9890, filed for the fiscal year ended December 31, 1990.**
10.12(b) Amendment dated June 17, 1992 to Employment Agreement dated September 16,
1987 among Manpower, Gilbert Palay and Manpower PLC, incorporated by
reference to the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1992.**
10.12(c) Amendment dated September 16, 1993 to Employment Agreement dated
September 16, 1987, as amended, among Manpower, Gilbert Palay and
Manpower PLC, incorporated by reference to the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1992.**
10.12(d) Consulting Agreement dated as of January 1, 1994 between
Manpower Inc. and Gilbert Palay, incorporated by reference to
the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1995.**
10.13(a) Employment Agreement between Jon F. Chait and Manpower International
Inc., dated August 3, 1991, as amended on March 12, 1992, incorporated by
reference to the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1992.**
10.13(b) Amendment dated February 18, 1997 to Employment Agreement dated August 3,
1991, as amended, between Manpower Inc. and Jon F. Chait.**
10.13(c) Agreement dated February 18, 1997 between Manpower Inc. and Jon F.
Chait.**
10.14 The Restricted Stock Plan of Manpower Inc., incorporated by reference to
the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1992.**
10.15 Amended and Restated Manpower 1991 Directors Stock Option Plan.**
10.16 Amended and Restated Manpower Deferred Stock Plan.**
10.17(a) Agreement dated December 8, 1992 between Terry A. Hueneke and Manpower
International Inc., incorporated by reference to the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1995.**
10.17(b) Employment Agreement between Terry A. Hueneke and Manpower Inc. dated
February 18, 1997.**
10.17(c) Agreement dated February 18, 1997 between Manpower Inc. and Terry A.
Hueneke.**
12
14
13 1996 Annual Report to Shareholders. Pursuant to Item 601
(b)(13)(ii), only the portions of the Annual Report
incorporated by reference in this Form 10-K are filed as
an exhibit hereto.
21 Subsidiaries of Manpower Inc.
23 Consent of Arthur Andersen LLP, incorporated by reference to the
Schedules to the Financial Statements, which Schedules are contained in
this Form 10-K.
24 Powers of Attorney
27 Financial Data Schedule
** Management contract or compensatory plan or arrangement.
13
15
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
MANPOWER INC.
By: /s/ Mitchell S. Fromstein
----------------------------
Mitchell S. Fromstein
Chairman of the Board
Date: March 27, 1997
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated:
NAME TITLE DATE
-------- --------- --------
/s/ Mitchell S. Fromstein Chairman, President, Chief Executive March 27, 1997
- ---------------------------
Mitchell S. Fromstein Officer and a Director
(Principal Executive Officer)
/s/ Jon F. Chait Executive Vice President, Principal March 27, 1997
- ------------------------------
Jon F. Chait Financial Officer, Secretary and a
Director
/s/ Michael J. Van Handel Vice President, Chief Accounting Officer March 27, 1997
- -------------------------- and Treasurer (Principal Accounting Officer)
Michael J. Van Handel
Directors: Audrey Freedman, Dudley J. Godfrey, Jr., Marvin B. Goodman, J. Ira
Harris, Terry A. Hueneke, Newton N. Minow, Gilbert Palay and Dennis
Stevenson
By: /s/ Jon F. Chait March 27, 1997
------------------------
Jon F. Chait
Attorney-In-Fact*
*Pursuant to authority granted by powers of attorney, copies of which are filed
herewith.
16
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
ON FINANCIAL STATEMENT SCHEDULE
To the Board of Directors
and Shareholders of Manpower Inc.:
We have audited in accordance with generally accepted auditing
standards, the financial statements included in Manpower Inc.'s annual report
to shareholders incorporated by reference in this Form 10-K, and have issued
our report thereon dated January 31, 1997. Our audit was made for the purpose
of forming an opinion on those statements taken as a whole. The schedule
listed in the index at item 14(a)(2) is the responsibility of the Company's
management and is presented for purposes of complying with the Securities and
Exchange Commission's rules and is not part of the basic financial statements.
This schedule has been subjected to the auditing procedures applied in the
audit of the basic statements and, in our opinion, fairly states in all
material respects the financial data required to be set forth therein in
relation to the basic financial statements taken as a whole.
ARTHUR ANDERSEN LLP
/s/ Arthur Andersen LLP
Milwaukee, Wisconsin,
January 31, 1997.
____________________
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this Annual Report on Form 10-K of Manpower Inc.
of our report dated January 31, 1997, included in the 1996 Annual Report to
Shareholders of Manpower Inc.
We also consent to the incorporation of our reports included (or
incorporated by reference) in this Annual Report on Form 10-K, into the
Company's previously filed Registration Statements on Form S-8 (File Nos.
33-40441, 33-51336, 33-55264, 33-84736 and 333-1040), the Company's
Registration Statements on Form S-3 (File Nos. 33-89660 and 333-6545) and the
Company's Registration Statements on Form S-4 (File Nos. 333-650 and 33-95896).
ARTHUR ANDERSEN LLP
/s/ Arthur Andersen LLP
Milwaukee, Wisconsin,
March 28, 1997.
17
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
For the years ended December 31, 1996, 1995, and 1994, in
thousands:
Allowance for Doubtful Accounts:
BALANCE AT PROVISIONS BALANCE AT
BEGINNING TRANSLATION CHARGED TO RECLASSIFICATIONS END OF
OF YEAR ADJUSTMENTS EARNINGS WRITE-OFFS AND OTHER YEAR
--------- ----------- ---------- ---------- ----------------- ----------
Year ended December 31, 1996 . . . . $32,901 (412) 12,360 (11,686) 363 $33,526
Year ended December 31, 1995 . . . . $31,170 2,203 8,981 (9,424) (29) $32,901
Year ended December 31, 1994 . . . . $19,829 1,470 14,807 (5,330) 394 $31,170