The news that Manpower, the world’s second largest staffing agency, has announced a huge rise in profits will come as a bitter blow for its larger rival, Adecco.

While Swiss-based firm Adecco has not yet even announced its full-year results because of ongoing accounting problems, Manpower has announced a $35.8m (£20.2m) increase in pre-tax profits for the first quarter of 2004.

The US company made profits of $60.2m (£34m), compared with $24.4m (£13.8m) in the same period last year.

To make matters worse for Adecco, whose shares are now rated as junk bonds by credit rating company Standard & Poor’s, Manpower’s status with investors has grown. Analyst Wachovia Securities has given its shares an “outperform” rating.

Manpower expects even better figures in 2004 and 2005 as the market picks up, a research note from Wachovia Securities revealed.

The company’s acquisition of Right Management Consultants, which was completed in January, contributed $102m (£57.6m) to a total turnover of $3.3bn (£1.9bn).

This bolstered revenue by 3% and added three cents to the firm’s total earnings per share.

There was also a one-off gain of $14.2m (£8m) from the sale of shares in a European job-board.

Jeffrey Joerres, Manpower chairman and chief executive, said: “The performance of the first quarter can be attributed to the entire Manpower team’s focus on following through and delivering on our strategies.

“Several units added significantly to this quarter’s result – Germany, Italy, Elan (our European IT staffing unit), Japan, Australia and Canada all posted outstanding results.”