Carl T. Camden – President, Chief Executive Officer & Director Patricia A. Little – Chief Financial Officer & Executive Vice President

John Healy – Northcoast Research Analyst for Tobey Summer – SunTrust Robinson Humphrey Welcome to Kelly Services’ fourth quarter earnings conference call. All parties will be on listen only until the question and answer portion of the presentation. Today’s call is being recorded at the request of Kelly Services. If anyone has any objection you may disconnect at this time. I would now like to turn the meeting over to your host Mr. Carl Camden, President and Chief Executive Officer.

Welcome to Kelly Services’ 2013 Q4 and year end conference call and with me on the call today is Patricia Little our CFO. Let me remind you that any comments made during this call, including the Q&A, may include forward-looking statements about our expectations for future performance. Actual results could differ materially from those suggested by our comments and we have no obligation to update the statements made on this call. Please refer to our SEC filings for a description of the risk factors that could influence the company’s actual performance. Turning now to Kelly’s fourth quarter and full year results, I’m pleased to report that our performance in the final quarter of 2013 exceeded our expectations. Revenue was $1.4 billion, up 1% year-over-year for the fourth quarter but down 1% for the full year. For the full year Kelly’s revenue was $5.4 billion compared to $5.5 million in 2012. Our gross profit rates for the fourth quarter was 16.7% up from 16.4% delivered last quarter and this also represents a 50 basis point improvement over the 16.2% achieved during the same period last year. Expenses on an adjusted basis were up 6.5% year-over-year in the fourth quarter due to planned investments, and up 1% for the full year. We achieved an adjusted operating profit of roughly $10 million in the fourth quarter compared to $14 million for the same period last year and down from $21 million in the third quarter. Adjusted operating earnings totaled $57 million for the full year compared to $75 million in 2012. Kelly’s adjusted fourth quarter earnings from continuing operations were $0.45 per share compared to adjusted earnings of $0.33 per share for the same period last year. For the full year, our adjusted earnings totaled $1.62 per share compared to $1.34 in 2012.…

Revenue totaled $1.4 billion, up 1% compared to the fourth quarter last year and up 3% sequentially. We have changed the way we report fee based income. Previously, we included OCG fees in the number reported. However, the growth in OCG has begun to mask the trend in staffing placement fees so starting this quarter we are no longer including OCG fees but will simply breakout staffing placement fee revenue. For the fourth quarter we’ve also adjusted the fee percentage change for the deconsolidation of our former operations in North Asia. So worldwide adjusted staffing placement fees were up 6% year-over-year and down 4% sequentially. Our gross profit rate was 16.7%, up 50 basis points compared to the fourth quarter last year, in part due to an 80 basis point improvement in the Americas. As Carl noted, the Americas improvement was due to fee growth in customer mix as well as lower payroll taxes and employee benefit cost. On a sequential basis, our gross profit rate was up 30 basis points also due to improvements in the Americas. During the fourth quarter we recorded restructuring charges of $300,000 primarily related to our previously announce plans in Europe. At this point we have completed our restructuring in Europe. The fourth quarter of 2012 included $1.3 million of restructuring charges and $3.1 million of impairment charges. Excluding restructuring expenses were up 7% year-over-year and 11% sequentially. The increase in both periods is due to a number of factors including higher costs due to additional headcount related to investments in OCG and centralized operations, merit increases, incentive based compensation, and an adjustment to our disability reserves. Adjusted earnings from operations were $9.9 million compared to 2012 adjusted earnings of $14.2 million. Income tax for the fourth quarter was a benefit of $8.2 million…

Looking back on 2013 despite the improvements in the US economy, it’s clear the job creation did not accelerate as expected. In fact, it’s important to remember that we’re still behind the prerecession employment peak. Though job creation remains uncertain, it’s clear that Kelly’s strategy is positioning us for growth. Our fourth quarter and full year results confirm that we’re moving in the right direction. Our OCG segment continues to exceed expectations, consistently delivering strong revenue fee and earnings results, winning profitable new business, and expanding current relationships within our large accounts. Our innovative talent supply chain management approach is gaining recognition and bringing in high margin business for Kelly while creating opportunities for significant growth well into the future. Our commercial business continues to be a market leader and deliver solid profitability. When it comes to professional and technical staffing frankly, we didn’t begin to make the level of investments in 2013 that were necessary to position Kelly for growth and our full year PT results reflect this delayed investment. In 2014 management and the board have committed to making a departure from the previous scope and speed of investment in our business. We will make targeted investments this year to adjust our operating models and intensify our focus on driving aggressive growth in higher margin specialties. As Patricia mentioned, we expect our SG&A to increase approximately 7-9% over 2013 levels as we continue to support OCG growth, accelerate our centralization efforts and as we ramp up our ability to recruit specialized talent and win profitable new PT business. Patricia commented on the expected impact of these investments on our 2014 earnings so let me provide you some additional color around the specific initiatives we are taking. We will continue to make the necessary investments to support the increase…

(Operator Instructions) Your first question comes from John Healy – Northcoast Research. John Healy – Northcoast Research: I wanted to hear a little bit more about the centralized PT effort. Could you give us a little more flavor for the size and maybe the number of locations you’re planning on opening, when those doors might be opened, how you plan on staffing it, and just a little bit more operational flavor for it?

We’re still in the process of putting together the exact sizing information. But again, if you look at centralized recruiting hubs that have been successful for us in the commercial space, we’re looking for that same type of effort in the PT space on the joining together of our virtual recruiters with our field based recruiters into virtual hubs as well as actual hubs on the ground. I’m not certain yet exactly how many branches are going to end up being affected. This is all in the process of being sorted out and delivered now. John Healy – Northcoast Research: Do you know how many hubs that you’ll actually establish for the centralized effort?

Four. John Healy – Northcoast Research: Kind of along the same lines, it seems like the investments that you’re making, your taking that leap, and I would expect though that with that going on as well as some of the momentum you’ve had on the OCG and some of the investments you’ve made there I was kind of surprised that you view gross margins to be kind of flat for 2014. Is there a level of caution in there or is there something kind of in the background? Competition kind of heating up on the more traditional staffing business? I was hoping to understand a little bit more why gross margins wouldn’t show some progress in ’14 relative to ’13?

I’d say a couple of issues are unfolding. One, you’ve seen us talk about mix as we’ve been playing out which is large customers have been more responsive to what we’ve been offering and to the centralized services and as we mixed out saw a couple of segments where we had lower GDP reported as a result of that change in customer mix and I think that’s one big factor. Also, on certainty around how much fee, what’s going to be the mix between firm placement and temp placement, perm fees [inaudible], nice pops here and there in margins for us. Will that continue into next year? Will company often, as they do, retreat back a bit after they’ve had a first perm hiring to bring in more temporary employees? We’re not certain.

I’ll also remind you something you and I have talked about before which is within OCG the different segments of the business have very different margins and so you can see that this particular quarter for example, as our PPO and BPO business increased they have wages in the denominator of that equation. So we like all that business, it’s just the accounting treatment is so very different between the segments it tends to influence our results. Actually OCG continues to be a bigger part of the equation. John Healy – Northcoast Research: Then I just wanted to make sure I heard you right Patricia, you said that the tax rate, assuming [inaudible] isn’t brought back in, is 25 percentage points higher than that mid 20s goal for the year so that would cut it close to 50%? I always thought it was a bit closer to 40%, I was just trying to understand that.

Structurally given our tax profile internationally, yeah it could be that high. Ever year we’ve done a little bit better than I always expect so I’m not a good tax predictor, I’ll certainly give you that. You’ve also seen our results overly influenced – I wouldn’t say overly influenced but highly influenced the last couple of years, as have most companies by high stock market gains in our company owned life insurance policies and of course I just couldn’t begin to tell you where that might go this year. So that’s part of what would drive a higher rate.

Your next question comes from Analyst for Tobey Summer – SunTrust Robinson Humphrey. Analyst for Tobey Summer – SunTrust Robinson Humphrey: I’d like to dig into the OCG growth a little bit. Can you give us maybe even a ranking of where that growth is coming from in terms of either new work, market share gains, or increased use of the work at existing customers?

It’s pretty balanced. I would say, if you were running a 50/50 model you’d be pretty close to what the actual numbers would be. We have a lot of programs that take anywhere often from a year to two years to implement and so you have a constant strain from your accounts of additional implementations. Then we’ve talked about significant new wins in the second half of this year that we think will continue the fee growth next year. So, at the moment I’m happy with the balanced approach, it’s growing the accounts we have which is always a really nice thing to see as well as an adoption of the talent supply chain model by new customers. Analyst for Tobey Summer – SunTrust Robinson Humphrey: In terms of the additional investments in PT, the pace of that has seen a little bit of a change here or it seems to be changing, what are you seeing out there that gives you the confidence to increase that pace of investment relative to the commercial side?

I think this is probably the first earnings call you would have heard us use the word so we have some confidence in a sustained growth in employment inside the United States. So we’ve got more confidence that we’re going to see not necessarily rock and roll employment growth but a nice steady growth and that has been overweighed in a lot of skill sets that fall within our technical professional space and as we talk with customers we expect an increase in demand for engineering, IT, science professionals so everything from general economic trends to specific customer conversations. Analyst for Tobey Summer – SunTrust Robinson Humphrey: Then outside the US especially, in EMEA, can you talk about what you’re seeing in commercial versus PT there?

I would never use, and I always remind every one of this, Kelly as an indicator of what is taking place in Europe. We have specialty businesses, we’re not sized in a lot of the countries. For us, we’re placing a particular emphasis on professional and technical as we are everywhere but that will be the results indicative of Kelly’s success or non-success of what we do not necessarily general growth in the market.

(Operator Instructions) Mr. Camden there are no additional questions coming in.

Thank you all for joining our call. I look forward to further conversations.

Ladies and gentlemen that does conclude your conference for today. Thank you for your participation, you may now disconnect.