Thank you for standing by and welcome to ManpowerGroup’s First Quarter Earnings Results Conference Call. This call will be recorded. If you have any objections, please disconnect at this time. And now I will turn the call over to ManpowerGroup Chairman and CEO, Jonas Prising.

Good morning. Welcome to the first quarter conference call for 2020. On the call with me today is our Chief Financial Officer, Jack McGinnis. We will start by going through some of the highlights of the first quarter, then Jack will go through the operating results and the segments, our balance sheet, and cash flow. Jack will comment on some considerations for the second quarter of 2020. I will then share some concluding thoughts before we start our Q&A session. Before we proceed, Jack will now cover the Safe Harbor language.

Good morning, everyone. This conference call includes forward-looking statements, including statements regarding the impact of the COVID-19 pandemic, which are subject to known and unknown risks and uncertainties. These statements are based on management's current expectations or beliefs. Actual results may differ materially from those projected in the forward-looking statements. We assume no obligation to update or revise any forward-looking statements. Slide 2 of our earnings release presentation includes additional forward-looking statement considerations and important information regarding previous SEC filings and reconciliations of non-GAAP measures.

Thanks, Jack. The first quarter of 2020 was an unprecedented one for our company. The magnitude and speed of the change in market conditions that occurred in the last couple of weeks of March was unlike anything we've seen in our over 70-year history. With that in mind, I would like to begin by thanking the ManpowerGroup team around the world for their incredible response to what is a health crisis first and an economic crisis next, with a significant impact on our people and business. The health and well-being of our people, our employees, our clients, and our associates has been and continues to be our top priority. With our talented teams and their expertise, we have responded swiftly to this global emergency, enabling us to support our associates and clients around the world. Our global footprint has allowed us to leverage the learnings from our APME business as we experienced the first wave of the COVID-19 pandemic moving from Asia to Europe to North America and to Latin America. We have a robust enterprise risk management framework, and our business continuity plans were executed promptly and efficiently at a global, regional, and country level. The technology investments we've been making for some years as part of our transformational journey have been critical in allowing us to respond immediately to the global pandemic. In a matter of 10 days in March, we were able to shift more than 80% of our people to remote working, and we have also extended our cyber and information security capability to accelerate the ability for some of our associates and consultants to work at home for clients where this was previously not possible. As has been well reported, by the end of March, significant lockdown measures had already been implemented in our main markets in Europe and North America as well as in other countries. With governments unable to provide firm information and dates on when and how restrictions will be lifted, predicting where a business will be in the short term is very difficult in this highly uncertain environment. Instead, we will be providing a more detailed update than usual within our country performance commentary, including revenue trends currently being experienced in April to provide more insight into what we're seeing and how we're managing through this in the short term. In the first quarter, revenue came in at $4.6 billion, down 6% year-over-year in constant currency. On a same-day basis, our underlying constant currency revenue decreased by 7%, reflecting the sudden drop of activity during March as our largest markets experienced COVID-19 related work restrictions. On a reported basis, operating profit for the first quarter was $38 million, down 63% in constant currency. Excluding restructuring charges from both years, operating profit was $86 million for the quarter, a decrease of 39% in constant currency. Reported operating profit margin came in at 0.8%, down 130 basis points in constant currency from the prior year, and after excluding the restructuring charges, operating profit margin was 1.9%, down 100 basis points from the prior year. Reported earnings per share of $0.03 reflects the impact of restructuring charges, a non-cash pension settlement charge, and an increased effective tax rate. Excluding the special charges, our earnings per share was $0.82 for the quarter, representing a decrease of 39% in constant currency. I'm proud to say that we have a strong leadership team that moved very quickly during the start of the pandemic to support our clients and our associates. We did this while protecting the bottom line as much as possible in the first quarter while creating plans for a very challenging second quarter. Our diversity across geographies, industries, and offerings has benefited us as some businesses have not been impacted materially by the crisis at this stage. Despite a very tough global economic environment, we did see revenue growth from Japan, Canada, Spain, and India in the first quarter. We're leveraging opportunities where industries are growing, such as logistics and food services, to partially offset material declines in manufacturing in many markets. Across our countries, we have implemented initiatives to reduce our SG&A and are prepared and ready to take further cost actions to optimize our business structure through this economic downturn while preserving our ability to rebound when market conditions improve. I'd now like to turn it over to Jack to take you through the financials and country performance details.

Thanks, Jonas. As a result of the COVID-19 related impacts, on March 18, we disclosed we’re withdrawing our previous guidance for the first quarter. Revenue in the quarter represented a reported decline of 8% year-over-year and on a constant currency basis represented a decrease of 6%. Acquisitions offset the impact of dispositions in the quarter and did not have a significant impact on the revenue trend in the quarter and more billing days this year contributed to about 1% of additional revenue. This results in an organic, constant currency days adjusted revenue decline of 7% in the first quarter, which compares to the fourth quarter decline of 1.5% on a similar basis. Our revenue trend during the quarter on a billing days adjusted basis included the monthly year-over-year constant currency revenue decline of 17% in March. In March, the majority of the decline was driven by our European businesses during the last two weeks of the month as governments issued states of emergency and related lockdown requirements. Our gross profit margin was down 30 basis points year-over-year and reflected lower permanent recruitment fees and higher sickness and absenteeism in certain countries, as well as increased direct costs associated with early termination of client contracts during the COVID-19 crisis in March. Our first quarter performance resulted in operating profit decline after restructuring costs of 41% or 39% on a constant currency basis. This reflects a significant and sudden operational deleveraging experienced in March. This resulted in operating profit margin of 1.9%, excluding restructuring costs. On a reported basis, earnings per share was $0.03, which included restructuring costs that had a $0.68 negative impact and a previously disclosed pension settlement charge, which had an $0.11 negative impact. Excluding these costs, earnings per share was $0.82. Regarding our effective tax rate, previously, we had guided to a full-year estimated rate at 34%. As we have discussed in the past, our effective tax rate is significantly impacted by the French business tax. Although this French business tax is primarily calculated based on revenues and not pre-tax earnings, it is considered an income tax for US GAAP purposes. In the normal economic periods, the French business tax represents about 7% of our effective tax rate, meaning a 34% to 35% estimate was comprised of an underlying 27% to 28% corporate tax rate component based on blended country income tax rates globally, plus the 7% impact on the French business tax component. Although corporate income taxes in France would be scaled downward due to lower pre-tax income, the French business tax will not see a comparable level of decrease since it remains calculated on revenue levels. As a result, the French business tax component will become a more significant portion of our total income tax expense in 2020, as our underlying corporate income tax amount will decrease on lower taxable income, but the French business tax amount will not decrease as significantly as derived from revenues of our French business, which will not be reduced as significantly as pre-tax income. This incremental French business tax weighting within our overall tax expense increased our effective tax rate by about 7% in the quarter, and we will provide further updates as the year progresses, as the result is dependent on revenues in France. Separately, the first-quarter tax expense included a discrete favorable benefit of $4.3 million, which lowered the effective rate by about 6%. The effective tax rate for the first quarter, excluding restructuring and pension settlement costs, represented 36.3%. Looking at our gross profit margin in detail, our gross margin came in at 15.7%. The staffing interim margin increase of 10 basis points year-over-year was offset by a decline in permanent recruitment fees year-over-year as a result of the COVID-19 impact in March, as well as lower talent-based outcome activity within the Manpower business. We anticipate ongoing material decline in higher-margin permanent recruitment activity during the duration of government lockdowns in most of our markets as the COVID-19 crisis continues into the second quarter. Next, let's review our gross profit by business line. During the quarter, the Manpower brand comprised 62% of gross profit, our Experis Professional business comprised 23%, and our newly launched Talent Solutions brand comprised 15%. As part of our year-end 2019 earnings release, we discussed our brand updates. Our year-over-year comparisons reflect the restatement of our brands for the prior year period. During the quarter, our Manpower brand reported an organic constant currency gross profit decrease of 10%. Gross profit in our Experis brand declined 6% year-over-year during the quarter on an organic constant currency basis. In our two largest Experis markets, this reflects flat gross profit in the U.K and a decrease of 2% in the U.S. This was offset by declines in Sweden, Germany, the Netherlands, and Australia. Talent Solutions includes our global market-leading RPO, MSP, and Right Management offering. Organic gross profit growth in the quarter increased 5% in constant currency, which was driven by MSP and RPO activity in the first two months of the quarter. We experienced a sharp reduction in RPO activity during March as many client programs initiated hiring freezes in light of the COVID-19 crisis. Our Right Management business experienced a decline in gross profit of 3% in organic constant currency during the quarter. Although Right Management has historically experienced an increase in outplacement activity during economic downturns, we are not seeing an increase in outplacement activity at this time as we believe clients are uncertain as to the duration of the downturn. Our reported SG&A expense in the quarter was $686 million, including $48 million of restructuring costs. SG&A expense was $638 million, a decrease of $21 million from the prior year after excluding restructuring costs from both years. On a constant currency basis, excluding restructuring costs, SG&A expenses were down 1% compared to the prior year. Excluding the restructuring costs, SG&A expenses as a percentage of revenue in the quarter represented 13.8%, which reflected the significant deleveraging on the sudden drop of revenues in March. As the drop in activity in mid-March was significant and sudden, we were not able to meaningfully scale down SG&A in this very short time period. However, we have taken significant actions in late March and early April, which will allow us to reduce SG&A to a much greater degree to better offset the significant gross profit declines anticipated in the second quarter. This includes leveraging government unemployment-related benefits, which allowed us to move unutilized staff and associates quickly onto these programs. We expect to recover the restructuring costs of $48 million through cost savings over the next 12 months with full run rate savings beginning in the third quarter. As we've previously announced, the geographical segments now include the results of Right Management, and prior periods have been restated for comparative purposes. I'll now turn to cash flow and balance sheet. I moved these slides up in order as a result of current market conditions. Free cash flow, defined as cash from operations plus capital expenditures, equals $172 million. This represented strong growth compared to free cash flow in the prior year of $92 million. We have historically experienced an increase in free cash flow as we enter a downturn, as we begin to collect our receivables while we incur lower payroll costs and lower activity. This contributed to a strong free cash flow effect in March. We would expect a similar underlying trend through the beginning of the second quarter provided that we experience consistent client payment patterns. At quarter end, day sales outstanding decreased slightly year-over-year. In this environment, one of our top priorities is maintaining strong cash flows from collection activities. To date, we have not experienced a significant decrease in cash receipts from clients and are watching this very carefully and ensuring our collection teams are appropriately staffed to diligently pursue payments as per original payment terms. Capital expenditures represented $9 million during the quarter. During the quarter, we purchased 871,000 shares of stock for $64 million. As of March 31, we have 5.9 million shares remaining for repurchase under the 6 million share program approved in August of 2019. Our balance sheet was strong at quarter end with cash of $1.1 billion and total debt of $1.04 billion, resulting in a net cash position of $56 million. Our debt ratios are very comfortable at quarter end with total gross debt to trailing 12 months EBITDA of 1.42 and total debt to total capitalization at 28%. Our debt and credit facilities did not change in the quarter, and the earliest euro note maturity is not for another 2.5 years. In addition, a revolving credit agreement for $600 million remained unused. Now I will turn to the segment results. The Americas segment comprised 22% of consolidated revenue. Revenue in the quarter was $1 billion, an increase of 1% in constant currency. OUP, including restructuring costs, equals $17 million. This represented a decrease of 26% in constant currency from the prior year, excluding restructuring costs. Of the $13 million of restructuring costs, $11 million related to the U.S., where we consolidated branches and other facilities and optimized front and back office processes, and the balance related to Canada and other countries in the Americas where we continue to simplify our operations. The U.S. is the largest country in the Americas segment, comprising 60% of segment revenues. Revenue in the U.S. was $611 million, down 2% compared to the prior year. Adjusting for billing days and franchise acquisitions, this represented a 6% decrease year-over-year, which included a 12% decrease in the month of March. The impacts of the COVID-19 crisis became more significant in the U.S. as we ended the quarter. During the quarter, OUP for our U.S. business decreased 44% to $13 million, excluding restructuring. SG&A costs included $4 million of one-off items, including a bad debt charge and a state sales tax-related charge. Excluding restructuring charges, OUP margin was 2.2%, a decrease of 160 basis points from the prior year. Within the U.S., which now includes Right Management as part of Talent Solutions, the Manpower brand comprised 34% of gross profit during the quarter. Revenue for the Manpower brand in the U.S. was down 5% in the quarter or down 12% when adjusted for billing days and franchise acquisitions. The Experis brand in the U.S. comprised 33% of gross profit in the quarter. With Experis in the U.S., IT skills comprised approximately 70% of revenues. During the quarter, our Experis revenues declined 1% from the prior year, and after adjusting for billing days, this represented a decline of 3%. Our Experis business in the U.S. has held up well during the COVID-19 crisis. Talent Solutions in the U.S. contributed 34% of gross profit, experienced a 9% of revenue increase in the quarter, or a 7% increase on a days adjusted basis. As indicated earlier, our RPO business has experienced significant client hiring freezes in late March into April as a result of the COVID-19 crisis. On an overall basis, based on April activity to date, our U.S. business is experiencing a revenue decline of about 20%. And that reflects the Manpower and Talent Solutions businesses are both down significantly in double-digit declines and the Experis business is in the mid-single digit decline. It is uncertain when COVID-19 related restrictions will be lifted in different parts of the U.S. and how those developments will impact our revenue trends. Our Mexico operation had flat revenue growth in the quarter and constant currency in the month of March, and the month of March was in line with the quarter overall. The business in Mexico performed well in the quarter in a difficult environment. The government of Mexico issued lockdown requirements at the beginning of April, which is having an impact on our business. During April, our Mexico business is currently experiencing percentage revenue declines in the mid to high single digits. The Mexico government has extended COVID-19 restrictions through May 30. Revenue in Canada was up 9% in constant currency, or 7% on a days adjusted basis, and this included a 3% revenue decline in the month of March. We're very pleased with the performance of our Canada business as they continue to lead the market. During April activity to date, Canada's current rate of revenue decline is in the low double-digit percentage range. Canada has extended their COVID-19 restrictions through May 12 in large parts of the country. Revenue growth in the other countries within the Americas was up 10% in constant currency. Southern Europe revenue comprises 42% of consolidated revenue in the quarter. Revenue in Southern Europe came in at $1.9 billion, a decrease of 5% in constant currency. OUP, including restructuring costs, equals $53 million. Excluding restructuring costs, OUP decreased 26% from the prior year on a constant currency and OUP margin was down 100 basis points, driven by France and Italy as a result of the severe impacts of the COVID-19 crisis in March. Of the $13 million of restructuring costs in the region, about a third relates to Portugal, where we are significantly reducing our less profitable call center operations. 20% relates to Spain for front office centralization and organizational simplification, and about 15% each relates to Italy and Switzerland for front office delivery changes, including branches and back office optimization. The balance primarily relates to simplification of our Israel and Eastern European operations. France revenue comprises 56% of the Southern Europe segment in the quarter and was down 14% from the prior year in constant currency, or down 15% on a days adjusted basis. In March, France experienced a days adjusted constant currency decrease of 34%, driven by the government's declaration of a state of emergency mid-month. During April activity to date, our business has been experiencing a year-over-year decline of approximately 65%. OUP was $38 million, a decrease of 29% in constant currency and OUP margin was down 70 basis points in constant currency at 3.5%. We have taken significant actions in France to reduce our costs during this period of materially reduced activity. We have moved about a quarter to a third of our full-time equivalent through government temporary unemployment programs and other initiatives and have cut virtually all discretionary spending. These actions should reduce France's SG&A significantly in April as we manage through the crisis. Improvement in the rate of revenue decline is dependent on the timing of the government's actions to ease the lockdown requirements. As of today, France has announced that their COVID-19 restrictions will be extended through May 11. Revenue in Italy equaled $328 million, representing a decrease of 5% in constant currency, which included a 17% days adjusted decline in March. At the end of March, the government imposed additional significant restrictions due to the crisis, and April activity to date has been down approximately 20% to 25% year-over-year. Permanent recruitment has been an important component of our Italy business and has declined materially during the crisis. We experienced a 50% decline in permanent recruitment gross profit in March, and April activity to date is down approximately 70% year-over-year. Excluding restructuring costs, OUP declined 28% in constant currency to $16 million, and OUP margin decreased 150 basis points to 4.8%, largely driven by lower gross profit margin on a lower permanent contribution. We have taken significant action in Italy to reduce costs during this crisis, which also involves moving FTEs onto temporary unemployment programs. This combined with the benefits of the restructuring actions should allow our Italian business to significantly reduce their SG&A in April. As of today, Italy's broader restrictions have been extended through May 3, and there may be some businesses opening before that date. Revenue in Spain increased 4% on a days adjusted basis in constant currency from the prior year in the quarter, which includes a days adjusted decrease of 5% in March as the impact of the crisis took hold. During April activity to date, Spain is currently operating at an estimated year-over-year revenue decline of about 25%. Although Spain has recently eased certain work-related restrictions, the government has announced they intend to extend their broader lockdown through May 9. We acquired the remaining interest in our Manpower Switzerland franchise at the beginning of the second quarter last year. This business represented 5% of Southern Europe's revenues and experienced trends similar to the other countries in the region due to the COVID-19 crisis. Our Northern Europe segment comprises 23% of consolidated revenue in the quarter. Revenue declined 8% in constant currency to $1.1 billion. OUP, including restructuring costs, represented a loss of $14 million. Excluding restructuring costs, OUP was $5 million, representing a decline of 72% in constant currency and OUP margin was down 120 basis points. The decline was driven by Germany, the Netherlands, and Sweden. Of the $20 million of restructuring costs, two-thirds relate to Germany, where we are taking significant actions to reduce finance and shared services back office costs, with the balance relating to the Nordics, the Netherlands, and Belgium where we continue to simplify our operations. The largest market in the Northern Europe segment is the U.K., which represented 36% of segment revenue in the quarter. During the quarter, U.K. revenues were flat in constant currency and down 2% on a days adjusted basis, which included the days adjusted decline of 6% in March. In April activity to date, our U.K. business experienced an estimated year-over-year revenue decline of approximately 20%. As of today, the U.S. government has imposed COVID-19 restrictions through at least May 7. In Germany, revenues declined 15% on a constant currency basis or 16% on a days adjusted basis in the first quarter, which includes a days adjusted decline of 23% in March. In April activity to date, we estimate a year-over-year revenue decline of 30% to 35%. As Germany is a benchmark, meaning our temporary workers are staffed as full-time employees for which we absorb the cost of unutilized time and sickness. Our ability to utilize government unemployment benefits for our bench associates and full-time equivalents is critical to preserving gross profit margin and minimizing operating losses in the current environment. The German program is subject to certain conditions and is providing 60% of lost after-tax wages due to the COVID-19 crisis. We anticipate this program will allow us to avoid absorbing substantial levels of unutilized bench costs and preserve gross margin. In addition to the restructuring actions I mentioned, the business is also taking significant SG&A actions to reduce the costs of running operations, also utilizing the government program, which is allowing us to reduce SG&A costs significantly in April. Germany has announced they will start to gradually lift certain provisions that they are locked down beginning May 4. In the Nordics, revenues declined 11% on a days adjusted basis and constant currency, which includes a 50% decline in March. The two primary businesses of Nordics are Norway and Sweden, which are both bench model businesses. During April activity to date, our Nordic businesses estimate a total revenue decline of approximately 20%. Government programs for unemployment benefits for our bench associates and FTEs running the operations are also critical in these markets, and we expect this will allow us to minimize the impact of gross profit margin erosion and reduce SG&A significantly in Sweden and Norway during these steep declines in activity. Revenue in the Netherlands decreased 18% in constant currency on a days adjusted basis during the first quarter, which includes a decline of 21% in March. In April activity to date, we are currently experiencing a year-over-year revenue decline of 30%. We previously mentioned new legislation increasing the cost of temporary work in the Netherlands effective at the beginning of the quarter, and this did not appear to have a significant impact on our revenue trends as we experienced an improvement in the rate of revenue at the beginning of the first quarter. The Netherlands also has significant bench operations related to our Experis business, and current government programs will be utilized to compensate for wages pertaining to bench associates as well as our FTEs running operations. Belgium experienced a days adjusted revenue decline of 15% in constant currency during the first quarter, which includes a decline of 30% in March. During April activity to date, we are currently experiencing a year-over-year revenue decline of 45%. Other markets in Northern Europe had a revenue increase of 6% in constant currency, primarily driven by January and February results and involve year-over-year growth in Poland and Ireland. We expect these markets to experience a high single-digit revenue decline approaching a double-digit decline in April. The Asia Pacific Middle East segment comprises 13% of total company revenue. In the quarter, revenue decreased 14% in constant currency to $595 million. Adjusting for the deconsolidation of our greater China operations, following their initial public offering in July 2019, this represented an organic constant currency revenue increase of 1% in the first quarter. OUP, including restructuring costs, equals $70 million in the quarter. Excluding restructuring costs, this represented a constant currency reduction in OUP of 21%, and after adjusting for the greater China deconsolidation, represented an organic constant currency OUP decline of 6%. OUP margin decreased 30 basis points excluding restructuring costs. All of the restructuring costs of about $3 million involve Australia, where we continue to simplify the business after exiting certain low-margin clients. Revenue growth in Japan was up 8% on a constant currency basis during the quarter, which includes a days adjusted revenue increase of 6% in March. The government of Japan initiated more restrictive COVID-19 measures in April in Tokyo and other large districts, which will be in place through May. In April activity to date, we are experiencing a year-over-year revenue decline in the low single-digit percentage range, but this trend could be negatively impacted as a result of the recent restrictions. Revenues in Australia declined 22% in constant currency adjusted for billing days, and includes a decline of 31% in March as the COVID-19 crisis took hold. In April activity to date, we are currently experiencing a year-over-year revenue decline of 30%. Revenue in other markets in Asia Pacific, Middle East were down 26% in constant currency and adjusting for dispositions, this represented a 7% growth rate. The largest market in the group includes our India business, which is experiencing double-digit revenue declines in April as the country has imposed various COVID-19 restrictions. We estimate that other markets overall will experience double-digit revenue declines in April. As Jonas mentioned previously, our business is impacted significantly by the COVID-19 restrictions in place in the markets in which we operate. We cannot forecast when and to what extent these restrictions will be lifted throughout the world or the change in demand for our services as restrictions are lifted. As a result, we cannot forecast our second quarter earnings and will not be providing guidance. I will cover a couple of quick administrative items. The impact of net dispositions in Q2 represents a year-over-year net revenue reduction of about $100 million in the second quarter, largely representing the deconsolidation of Greater China for one last full quarter. As mentioned, the French business tax, which is recorded as income tax expense for US GAAP, will have an impact on our tax rate in 2020, as it is based on revenues and not earnings. We estimate that our weighted average shares to be 58.5 million, reflecting share repurchases through March 31.

In summary, as we manage a very difficult environment during the second quarter, we are taking significant actions to scale back our SG&A to respond to the immediate significant gross profit reduction. We enter this environment with significant liquidity and balance sheet strength and are laser-focused on optimizing cash flow through strong collections and balance sheet management activity in the second quarter. Although we have outlined the significant immediate actions we are taking, we are also continuing to move our strategic programs forward. We believe this will allow us to capitalize on new business opportunities when we enter a recovery phase and will make us a stronger, more efficient, and more productive enterprise. As we've previously announced, the geographical segments now include the results of Right Management, and prior periods have been restated for comparative purposes. I'll now turn to cash flow and balance sheet. I moved these slides up in order as a result of current market conditions. Free cash flow, defined as cash from operation plus capital expenditures equal to $172 million. This represented strong growth compared to free cash flow in the prior year of $92 million. We cannot forecast when and to what extent these restrictions will be lifted throughout the world or the change in demand for our services as restrictions are lifted. As a result, we cannot forecast our second quarter earnings and will not be providing guidance.

Thank you. Our first question is from Andrew Steinerman of JPMorgan. Your line is now open.

Hi. Good morning. This is Michael Cho on for Andrew. Thanks for taking my question. My first question is, as we think about the restructuring costs in the quarter, I guess if this downturn is prolonged, how should we think about various cost actions in the future?

Michael, this is Jack. I think on the restructuring costs, as we've talked about, we'll start to see those savings fully ramp up in the third quarter. We'll be pretty close, I think probably about 80% of the run rate effect in the third quarter. So we will start to see some immediate impact on that in addition to all the other actions that we've talked about. But I would say we definitely have more opportunity to continue to take out costs from the organization. I think what you've seen us do in phases is take out back office costs in different regions. And we've done that in a very significant way in North America and we continue to do that based on the restructuring actions we've just announced. And we're doing that more significantly in Europe at the moment and we're doing that in Germany as we've talked about in our prepared remarks.

Great, thanks for the color, Jack. If I could just squeeze one more in. You gave some great color around trends through April and I guess I'm particularly thinking about Europe and the U.S., but there are temps at work today in April, despite the broad government shutdowns. Is there any reason to think that they won't remain with clients in the near term if the downturn is prolonged?

No, I'd say, what we're seeing now, and I think we talked about in our prepared remarks where we are seeing some growth opportunities, particularly in food and consumer goods which are areas where we continue to see good activity, logistics, and transportation. We continue to see good activity. And there are parts of manufacturing related to those segments that are continuing to be quite strong. So I think what we've seen is our model is working for a lot of our clients. We continue to be an important part of their workforce, and I don't see that changing. I think, if anything, as we emerge from this crisis, I think we'll start to see an increase. And I think a lot of employers will continue to see the benefits of temporary staffing on their business models as a result of this crisis and as we continue to emerge from it. So I don't see there being a lot of core underlying work continuing, and to your point, I don't see that changing.

Thank you. The next question is from the line of Hamzah Mazari of Jefferies. Your line is now open.

Hey, guys. This is Ryan Gunning on for Hamzah. Just real quick. Could you update us on any regulatory changes you're seeing upcoming in the business you're tracking across the various regions?

Maybe, Hamzah or rather Ryan, the regulation changes that we've talked about were around Japan as well as the Netherlands. In the case of the Netherlands, as Jack mentioned in his prepared remarks, we've not really seen an impact to the business as far as those regulations were concerned. And also in Japan, so far at least, we are seeing no material impact to the equal pay legislation that was introduced earlier this year. So I think both of those are really something that we don't expect to see any major business impact from.

Okay, great. And just a quick follow-up. Could you just talk a little bit about how the MAN business today is different versus the 2009 recession? And alongside that, any thoughts in general, how are you thinking about your downturn playbook during this pandemic?

Yes, looking back and comparing this situation to the recession of 2008 and 2009, it is clear that this crisis is fundamentally different as it is primarily a healthcare issue. The speed and scale of the changes occurring globally have also diverged significantly from the past recession. For us, we quickly transitioned to remote work, which is beneficial in a healthcare crisis where social distancing is necessary. Our current business mix is significantly stronger; for instance, Experis now accounts for 23% of our business compared to 14% in 2008. Additionally, our Solutions business has grown from 4% to 11%, not counting Right Management. We've also decreased our fixed selling, general and administrative expenses compared to the last recession. For example, we operated 4,500 physical branches in 2008, while we now have fewer than 2,500. Thanks to our investments in technology, we have shifted many operations online, allowing us to develop a more flexible cost structure. We undertook a simplification initiative between 2012 and 2013 to structurally reduce our cost base. Overall, our preparedness enables us to be more agile in managing costs, with greater technology integration allowing us to respond much faster to changes than we could in 2008 and 2009.

And I would just add, as we mentioned in our prepared remarks, the one other item that's very different now is the strength of the government programs and the very immediate term. So we are much better to leverage those. So Jonas's point, this has moved much faster than it did in the last big downturn. And as a result, the governments have responded with bigger programs in the immediate term. So we are better able to leverage those programs now, which wouldn't have existed to the same degree previously.

Great. Very helpful. Thanks, guys.

Thank you. The next question is from the line of Jeff Silber of BMO Capital Markets. Your line is now open.

Thank you so much. I really appreciate the color in March and April by the different regions. I think you mentioned that France was down 65% in April to date. I just want to confirm that. And if so, why is that country doing so much worse than some of the other countries you're in? Thanks.

Yes, that's correct. We are observing a similar run rate in April in France. As we analyze the global situation with varying lockdown levels, it appears that the impact of the lockdowns has stabilized throughout Europe, including France, where the current situation is comparable to what we witnessed a few weeks ago. This stabilization indicates that market reactions and business volumes in Europe have leveled off. In response to your question about why France is experiencing a more significant downturn than other markets, it's important to note that France implemented some of the strictest lockdown measures in Europe on March 16. Several factors contribute to this situation. Firstly, there is strong union representation in France. Secondly, President Macron announced that the country would undergo lockdown regardless of the cost. This means that both employers and employees are largely compensated by the French government during the lockdown. Additionally, the support programs were clearly defined from the outset on March 16, unlike in many other countries where the details took weeks to establish after the lockdown began. In France, workers are almost fully covered for their lost income throughout the lockdown, and companies are also receiving support. The severity of the lockdown, combined with substantial financial aid and the clear communication surrounding the support programs, effectively led to a rapid shutdown of the country within 48 hours—a situation we have never encountered before. To put this into perspective, it would be similar to having approximately 70 million to 80 million people in the U.S. out of work since about 50% of private employment in France is currently under temporary unemployment programs, and these numbers surged dramatically within just 36 to 48 hours.

That was very helpful. I really appreciate that. Switching gears, Jonas, I think in your prepared remarks at the beginning, you talked about maybe some of the lessons that you learned in APME since the crisis started a little bit earlier there. Can you give us some color on what you learned? And I know China, because of the deconsolidation, you may not be as privy to the issues there, but I'm wondering if we're seeing any green shoots in China in your business? Thanks.

Well, I'll start with your last part first. In China, since we've deconsolidated and we IPO-ed the business in the summer of last year, we don't really have any operational insights. The last earnings release came out, covering the period towards the end of 2019. So they'll be releasing results later on. So we don't really have operational insights beyond what you can read from the papers regarding what's happening in China. But in terms of the lessons learned in APME was really going through our business continuity process and starting to ramp up all of the measures we would take to protect the business, both in terms of remote working as well as safe working for those that were not able to work remotely and really just establish our processes because we expected that the waves, starting in Asia, would make it to Europe as they did, and then they would move from Europe to North America and subsequently to Latin America. So our businesses really benefited from the global visibility of what we needed to prepare for. While the changes in France were very sudden and the change in Italy and Spain a little bit less sudden, but still very quick over the arc of 2 weeks, we had processes in place as a company, both from a technology perspective and from a business continuity perspective that we could activate and in some cases already anticipate. That has been very helpful in our ability to adapt to this rapidly changing environment very quickly.

Okay, great. Thank you so much.

Thanks, Jeff.

Thank you. And our next question is from the line of Seth Weber of RBC Capital Markets. Your line is now open.

Hi. Good morning, guys. Question on the Experis. Margin was better than kind of what we would have expected. Do you think that is sustainable, and that you can continue to outperform on the gross margin side on Experis, or is there just some sort of lag effect there that you think will soften more going forward? Thanks.

Generally speaking, all of our businesses were meeting expectations until mid-March. Manpower faced the headwinds we anticipated due to the slowdown in global manufacturing. However, Experis was showing solid growth, and our Talent Solutions business was performing strongly as well. The Experis business, as expected, holds up better because its projects are longer term. The demand for skills remains high, and technology will be a strong sector both before and after the pandemic. Our margin profile in the Experis business is better than in Manpower. That said, we observed some delayed impacts, with most of the downturn in Experis occurring in the bench markets in Germany and the Netherlands. For the first quarter, we didn't notice significant changes in Experis elsewhere globally. As Jack mentioned in his remarks, we are starting to see some effects, but they are much smaller compared to Manpower. We anticipate some softening in the Experis business overall. Nonetheless, we remain optimistic about our positioning and the potential for profitable growth when the market recovers for Experis.

Okay. Thanks. And then maybe, Jack, in your prepared remarks, you mentioned something about early termination of contracts. Is there any more color around that, whether it's sizing? Just how the mechanics of that will look? Anything you could add to sort of flush that out? Thanks.

Yes. No, I would say Seth on that, it really was getting out at the very end of March when some of the contracts typically with some of the staffing contracts, they’re shorter terms and commonly they will end at the end of the month, end of a quarter. So we had a lot of contracts maturing at the end of March. So as we worked with our clients, and Jonas mentioned what was happening in France, we had to work with our clients on early termination of those contracts, which meant looking at the associates on assignment and ensuring that they were going to get paid through the end of a contract and some specifics and those type of items. As a result of that, we ended up absorbing a little bit more direct cost than we normally would have. I would say that's isolated to March because it really was dealing with what was happening with those contracts mid-month. A lot of those contracts have been reset at the beginning of April. So I wouldn't anticipate that that's going to be an ongoing issue for the second quarter. It was really trying to get at we were experiencing a bit more direct costs in absorbing a bit more costs as we unraveled some of that activity at the very end of March. We also had the impact of our bench countries.

Okay. It's very helpful. Thank you, guys.

Thank you. And the next question is from the line of Mark Marcon of Baird. Your line is now open, Mark.

Great. Good morning, Jonas and Jack. I was wondering if you could first share your capital allocation priorities and specifically how you are considering the dividend.

Yes. So, Mark, I'd say our capital allocation strategy remains consistent. And we've been pretty clear on that in the past. So the dividend has been a priority for us in the past, and we continue to rank that very high on the list. If we look at excess cash beyond that, we tend to look at whether there's an acquisition that needs cash. If that's the case, we will devote excess cash to that. If there isn't an acquisition and there haven't been any very significant acquisitions for us, then excess cash has been returned through share repurchases. Now, with that being said, we don't pre-announce share repurchase activity. You can see we were active in the first quarter. But we also said at this time we're very focused on preserving a very strong balance sheet as we get through the second quarter. On the dividend specifically, Mark, that is typically an action that we review with our board at our May board meeting. So after that meeting, we have an announcement on the dividend for the next 12 months, and we will wait to review that with our board in May and make an announcement after that meeting.

Okay, great. And then, you gave really good color in terms of what you're seeing thus far in April. Some of the lockdowns are going to be coming off. I'm wondering how are you thinking about what the magnitude of the rebound is going to end up being when the lockdowns come off, particularly any sort of experiences or color that you're getting from your clients in some of the markets where either it's happened, such as in China or markets that are just at the early stages like Austria or Germany is talking about it for in the very near future. What's the discussion like, what's the expectation in terms of the rebound?

Well, Mark, it's a great question, and it's very hard to tell. The reason it's hard to tell is at this point, as we mentioned, we don't really have much operational insight into the China rebound more than what you read about various industries coming back in China, and I don't know that China is a good proxy for the rest of the world. What I can say, though, is that we are relatively pleased in terms of we're not pleased with the lockdown effects, of course, in our business, but we are pleased to see that across Europe, the trend has stabilized at the levels that Jack described. So we would expect once the lockdowns open up that trend will improve. Now, the difficulty in predicting how that improvement will take shape is the lack of specificity and clarity on the part of the governments on which sectors are opening up, what is essential, what is non-essential, and how that all plays out in the various countries. Frankly, the Austrian opening up or Denmark opening up, is still too early to see any meaningful trend that we can extrapolate. That's why, in summary, it's challenging for us to predict where it's coming back. But we expect to see stabilization in Europe, which is a good starting point. When the lockdowns come off, we would expect to see improvement in those trends. The degree and the momentum of which is very difficult to guess at this point, just as we couldn't guess that the French market would drop down to 65% in the course of 48 hours. So we'll monitor that, of course, very carefully. We would expect North America to lag Europe in terms of stabilization by another couple of weeks, 2 to 3 weeks, maybe. The beginning of May should be the next starting point for us to think about the improvement in trends as the lockdown eases in the U.S., as well as in Canada, then followed by Latin America which is the last wave where we have significant businesses, and they will probably be seeing something stabilize towards mid-May, maybe towards the end of May. It is very dependent on how the government is planning to release it. We expect it to be gradual. I don't think it's going to be the reverse of the French shutdown starting up again. But it is clear that there is a desire from many governments to ease the economic pain that follows the health crisis. The good news is the health crisis in many parts of the world now appears to be under control or more manageable, which means we can now put our focus and attention to averting or softening the effects of an economic crisis. We would expect to be in the forefront of that based on our industry, and Jack talked about if you ever needed a reminder of why operational and strategic flexibility is important, this pandemic illustrates that to many of our client companies. We're going to be watching, and of course, as we've talked about also in our prepared remarks, we've been very careful in terms of we took significant actions in Q1 but especially in Q2, but all the while preserving our ability to rebound when demand improves. We can respond to our client needs at that time. We've been very careful and making sure that we balance the short-term by maintaining our ability to take advantage of the market when it improves.

Great. And then just wondering with regards to the U.S., how do you think the widespread use of furloughs is going to impact kind of the demand for temporary staff when things eventually start rebounding?

It's difficult to say. Furloughs in the U.S. operate quite differently. However, the purpose of the furlough system and the support from PPP and similar programs is akin to what various European and Asian governments aspire to achieve, which is to mitigate the economic crisis by reducing the impact of unemployment on workers, enabling them to retain their purchasing power as much as possible when the economy begins to recover. Naturally, we expect those employees to return. Additionally, having the ability to adjust the workforce will be increasingly important moving forward. We anticipate that the situation will resemble past recoveries once the economy starts to gain traction again.

Thank you. Our next question is from the line of Gary Bisbee of Bank of America. Your line is now open.

Hey, guys. This is Jay Hanna on for Gary this morning. Just to get a little more granular on the differentiation in market performance, all the insight you gave on France was great, but to be expecting a 65% decline in April versus just, I believe you said, 20% to 25% in Italy in April. I mean, that seems like a pretty big difference, particularly it seems like Italy was maybe even hit a little bit harder. That goes for Spain as well, just a 25% decline. So what's really driving that gap there?

Well, Jay, if you look at how the government implemented the lockdowns, there was a social lockdown announced early, but for all intents or purposes, companies could still operate reasonably unimpeded except some sectors up until probably the last week of March in Italy and following on with Spain starting in April. There was a lot of social distancing and evidence sectors, and certain high contact sectors like hospitality, restaurants, and hotels were impacted early on. But many of the businesses that we serve continued to operate well further into March. That's one of the reasons why you're seeing a smaller effect in Italy and in Spain. But as I mentioned earlier in our Q&A, the very severe impact in France is, I think unique to France due to the severity and speed of the lockdown, the very transparent employer and employee support programs that were well known and strong union influence, those are a number of factors that made France's reaction come on faster and go deeper. France is really a bit of an outlier at this point. Those would be the reasons that you can consider when thinking about the difference between Italy, Spain, and France.

Okay. And then, obviously, it seems like Experis has held in there a little bit better. Have you seen any meaningful success, I guess, in the other lines with temps working remotely?

Yes, we've had customers also within Manpower, as well as on our Talent Solutions business, where we’re able to run parts of that business remotely with remote recruiters engaging with clients. All of that is really thanks to some of the technology investments we've made over a number of years. We think that this pandemic and actual effect is going to accelerate and give us more flexibility in how we deploy technology, not only to run our own internal operations, but also in how we support our clients and engage with candidates. You're seeing that on the Experis side, but we've also seen it on the Talent Solutions side and in some cases also on the Manpower side.

And I would just add, Jonas, within Talent Solutions, MSP has been holding up fairly well so far, too. Obviously that's going to depend on what happens next with some of the restrictions and so forth in the U.S. But MSP so far through mid-March has been actually holding up well.

Right. Thanks, guys, and good luck from here.

Thank you.

Thank you. The next question is from the line of Ryan Leonard of Barclays. Your line is now open.

Yes. Thank you for having me. I'm curious about your thoughts on the lack of official guidance. You've provided a lot of detail on current trends, but can we consider the trends observed in April to be the worst-case scenario? Or is there still significant uncertainty that prevents you from giving specific numbers until you gain a clearer understanding of how various countries will begin to recover?

Yes. So I would say, the trends for April, clearly based on what Jonas was giving some color to in terms of what we're seeing in Europe. We have seen consistent levels. At these lower levels, they've been consistent in the last couple of weeks here in April where we see really the height of the restrictions in place in many of those countries. The question will be to the extent that does the U.S. see some additional pressure? We're not sure. I think Jonas mentioned that the U.S is behind a couple of weeks from what we saw in Europe. It could be that the U.S. ends up very consistent for the rest of the restriction period at the levels we're seeing right now. We just don't know that for sure. So, is April a pretty good view of what will be kind of the low point for the quarter? Very likely, but it's just really hard to say at this point. For that reason, we wanted to be very transparent in what we were seeing in April. It really is going to be the quarter overall, which is going to be dependent on the impact of the restrictions being lifted and how that impacts the demand for our services immediately upon those restrictions being eased. So that's what we can't predict at this stage, and that's why we provided all that color on April.

Got it. That's helpful. And then just on the U.S. Experis business, down mid-single digits in April, it's relatively stable. Is that the nature of existing contracts that are already ongoing, or maybe can you comment on new business trends that you're seeing there just to help kind of understand what's like the lagging versus the leading indicator?

Yes, I would say it's a mix, but I'd say largely it's a continuation of our business and our strategy in the U.S. I think what we've talked about in the last couple of quarters is our convenience business has been very, very strong in the U.S. And that's actually contributed to GP margin increase in the last few quarters, and that continues. The Experis business, as we mentioned, was down about 3% days adjusted in the first quarter, and it's only come off very slightly so far at the minus 5% or so here in April. It's holding up well, and that's largely due to the existing clients we continue to serve. There actually have been wins in there as well. We've had wins in April that are part of that as well, which have helped to offset some replenishment of other business. We feel good about that, and we also mentioned that the U.K. was flat in the quarter overall as well. So, Experis specific to the U.S where your question was, it's a bit of both, and there have been some wins as part of that in April.

Very helpful. Thank you.

Thank you. And our next question is from the line of George Tong of Goldman Sachs. Your line is now open.

Hi. Good morning. This is Blake on for George. It sounds like labor strikes and the discussion of reforms have taken a bit of a backseat in France to the lockdowns. What are your expectations for discussion of labor reforms and strikes in France going forward once the labor market starts to pick up and we see more activity in France?

As you might remember, the pension reform has been enacted and is now law. That was the primary cause of the strikes. The French labor market is continually evolving with various initiatives. Currently, there is no indication of any upcoming labor market tensions in France since the pension legislation has been passed by their parliament. That said, while we have no updates today, circumstances can certainly change. Overall, as we noted during our fourth quarter earnings call, although there were some strikes, their overall impact was relatively limited at that time. Those issues have been resolved now. France continues to advance its labor market reforms, and in terms of our business, the changes that have been implemented are largely beneficial to our industry. We do not foresee any reversals of these new legislations or reforms at this moment.

Got it. That’s helpful. And then it looks like in Q4 we had seen some improving trends in bill pay spread pretty broadly across your businesses. How do you see bill pay spread evolving as labor markets absorb this sudden shock and sectors gradually reopen? Just curious what kind of trends you're expecting in terms of bill pay spreads.

I would say we were pleased to see our staffing margin continue to improve in the first quarter, even though we were in this kind of environment. That tells us that our underlying pay bill spread is looking good. As an overall comment, the changes we're seeing in staffing GP staffing, GP, as well as overall GP today are all related to business mix changes and the changes that are occurring because of the COVID-19 pandemic. They're not due to any price pressures that we're seeing. Fundamentally, what we had before, which was a good market, and our ability to fairly price for the skills that our customers are looking for, continued. We were pleased to see that continue all the way through the first quarter.

Great. That's helpful. Thank you.

Thank you. Next question is from the line of Tobey Sommer of SunTrust. Your line is now open.

Thank you. I was wondering if you could comment on the scope of potential acquisitions as we come out of this and the areas of interest to the firm as you kind of see the experience in the Experis P&L versus the core Manpower brand and the rest of the business, because you did come out pretty aggressively after the last downturn. Thank you.

As Jack mentioned, our capital allocation strategy hasn't really changed. We continue to focus on organic growth. When it comes to acquisitions, we proceed with caution. If we were to consider them, they would likely be in the areas of Experis and Talent Solutions, rather than Manpower, unless it pertains to franchise acquisitions. We are very careful with acquisitions in our industry, ensuring not only that they are good businesses but also that they align strategically and culturally, allowing us to retain key talent. Our strategy and approach remain consistent.

In the RPO business, had there been any surprises in performance, and how do you see that evolving in this environment?

I think we saw some very good evolution in the fourth quarter, and that strength carried on into the first quarter as well until the pandemic hit. Then, as you would expect, the number of our clients that were in sectors exposed for a front line, such as airlines and other businesses in that case, they pulled back pretty strongly. We're seeing that reflected in our activity right now. The good news is none of those clients left us. These are programs. That's why they work with us. We provide the strategic and operational flexibility for them. When their business picks up again, we would expect to see a strong rebound also in the RPO side in those sectors that were affected. We're also doing business in many sectors that aren't affected. As we talked about in our prepared remarks, we are finding some of those sectors that are actually beneficial to our RPO business in the U.S. as well as elsewhere in the world.

Thank you.

And that brings us to the close of our first quarter earnings call. Thank you for participating today. We look forward to speaking with you all again at our second quarter earnings call in July. Thanks and have a good rest of the day.

Thank you, speakers. And this does conclude today's conference call. Thank you all for participating. You may disconnect now.