Automatic Data Issues Downbeat Revenue Forecast
28 Julho 2016 - 1:56PM
Dow Jones News
By Brittney Laryea
Automatic Data Processing Inc. (ADP) issued a downbeat revenue
forecast for the recently started fiscal year and announced plans
to simplify its service organization.
The provider of human-resources software and services said it
aims to align its service organization with its strategic platforms
"to augment ADP's service capabilities and contribute to operating
efficiencies over the longer-term."
For the fiscal year, ADP expects revenue to grow 7% to 9%, which
is above its 6.7% growth in 2016 but below the 9% increase that
analysts surveyed by Thomson Reuters were expecting.
ADP shares, up 14% over the past year, fell 3.5% to $91.65 in
midday trading in New York.
For the quarter ended June 30, ADP posted income of $282
million, or 62 cents per share, down from year-ago earnings of
$336.2 million, or 72 cents a share. Excluding certain items, such
as severance charges and tax benefits, per-share earnings increased
to 69 cents from 55 cents.
Revenue rose 7.6% to $2.9 billion.
Analysts polled by Thomson Reuters had expected 67 cents in
per-share earnings on revenue of $2.94 billion.
In the quarter, employer services revenues increased 6% to $2.29
billion. The number of payroll employees for ADP's clients rose
2.5% in the U.S. as client revenue retention fell 0.8% in the
fourth quarter.
ADP said it expects its employer services segment to grow 4% to
5% in 2017.
Revenues in the professional employer organization services
segment rose 13% in the quarter. The number of average worksite
employees paid by the segment increased 13% to 432,000.
The company said it expects revenue in the professional employer
segment to grow 14% to 16%.
Write to Brittney Laryea at Brittney.Laryea@wsj.com
(END) Dow Jones Newswires
July 28, 2016 12:41 ET (16:41 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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