Company: KELYB
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0000055135-25-000052
Chunk: 117

Company: KELLY SERVICES INC
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 2
Chunk 117
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 reported profit increased versus the prior year primarily driven by higher revenue and gross profit, partially offset by an increase in SG&A expenses.

Corporate expenses increased over the prior year primarily driven by integration and realignment charges in 2025.

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Financial Condition

Historically, we have financed our operations through cash generated by operating activities and access to credit markets.  Our working capital requirements are primarily generated from temporary employee payroll, which is generally paid weekly, and customer accounts receivable, which is generally outstanding for longer periods.  Since receipts from customers lag payroll to temporary employees, working capital requirements increase substantially in periods of growth.  Conversely, when economic activity slows, working capital requirements may substantially decrease.  This may result in an increase in our operating cash flows; however, any such increase would not be sustainable in the event that an economic downturn continued for an extended period.  We also experience seasonal reductions in working capital usage in our Education business related to the summer school holidays.

As highlighted in the consolidated statements of cash flows, our liquidity and available capital resources are impacted by four key components: cash, cash equivalents and restricted cash, operating activities, investing activities and financing activities.

Cash, Cash Equivalents and Restricted Cash

Cash, cash equivalents and restricted cash totaled $24.5 million at the end of the second quarter of 2025 and $45.6 million at year-end 2024.  As further described below, we generated $119.3 million of cash from operating activities, generated $24.7 million of cash from investing activities and used $172.7 million of cash for financing activities.

Operating Activities

In the first six months of 2025, we generated $119.3 million of net cash from operating activities, as compared to generating $32.2 million in the first six months of 2024, primarily due to decreased working capital requirements as compared to the same period of the prior year.  

Trade accounts receivable totaled $1.2 billion at the end of the second quarter of 2025.  Global DSO was 59 days at both the end of the second quarter of 2025 and at year-end 2024.

Our working capital position (total current assets less total current liabilities) was $426.4 million at the end of the second quarter of 2025, a decrease of $112.6 million from year-end 2024.  Excluding the decrease in cash, working capital decreased $91.6 million from year-end 2024, primarily driven