Automatic Data Processing, Inc. (Nasdaq:ADP) reported revenue
growth of 12%, 7% organic, to $2.7 billion for the third fiscal
quarter ended March 31, 2011, Gary C. Butler, president and chief
executive officer, announced today. Pretax earnings from continuing
operations increased 3% from a year ago. Net earnings from
continuing operations increased 6%, which was positively impacted
by a lower effective tax rate in the current quarter. Diluted
earnings per share from continuing operations of $0.85 increased 8%
from a year ago on fewer shares outstanding. DP acquired over 3.8
million shares of its stock for treasury at a cost of nearly $175
million fiscal year-to-date. Cash and marketable securities were
$1.7 billion at March 31, 2011.
Third Quarter Discussion
Commenting on the results, Mr. Butler said, "I am quite pleased
with ADP's third quarter results. We achieved strong new business
sales growth for Employer Services and PEO Services, and client
revenue retention during this critical calendar year-end period was
very strong. Pays per control, PEO worksite employees, and client
funds balances continued to increase as well. I am delighted with
our acquisition activity, closing two additional transactions
during the third quarter. In Dealer Services, it appears that the
worst is behind us and the automotive marketplace continued to
steadily recover.
Employer Services
"Employer Services' revenues grew 9% for the third quarter, 7%
organically. In the United States, revenues from our traditional
payroll and payroll tax filing business grew 5% for the quarter.
Beyond payroll revenues grew 15% for the quarter, assisted by
acquisitions. The number of employees on our clients' payrolls in
the United States grew 2.7% for the quarter, as measured on a
same-store-sales basis for our clients on our Auto Pay platform.
During this key retention period, worldwide client retention
improved 1.9 percentage points for the quarter. Employer Services'
pretax margin declined 30 basis points for the quarter due to the
negative impact from acquisition activity.
"Combined Employer Services and PEO Services worldwide new
business sales grew 13% for the third quarter compared with a year
ago. New business sales represent annualized recurring revenues
anticipated from new orders.
PEO Services
"PEO Services' revenues increased 18% for the third quarter, all
organic. PEO Services' pretax margin increased 50 basis points from
a year ago. Pressure on the pretax margin from higher pass-through
revenues were offset by the year-over-year impact of a one-time
item in last year's third quarter. Average worksite employees paid
by PEO Services increased 13% for the third quarter, to
approximately 233,000.
Dealer Services
"Dealer Services' revenues increased 29%, 3% organically, for
the third quarter. Total revenues benefited primarily from the
Cobalt acquisition closed in the first quarter. Dealer Services'
pretax margin declined 200 basis points from a year ago due to the
negative impact of acquisition-related costs. Dealer Services
continued to gain market share with strong competitive win
rates.
Interest on Funds Held for Clients
"The safety, liquidity, and diversification of our clients'
funds are the foremost objectives of our investment strategy.
Client funds are invested in accordance with ADP's prudent and
conservative investment guidelines and the credit quality of the
investment portfolio is predominantly AAA/AA.
"For the third quarter, interest on funds held for clients
increased $0.7 million, or 0.5%, from $147.9 million to $148.6
million, due to an increase of 12% in average client funds
balances, from $18.4 billion to $20.6 billion, partially offset by
a decline of 30 basis points in the average interest yield to
2.9%.
Fiscal 2011 Forecast
"Our forecasts for fiscal 2011 assume no changes in the current
economic environment and have been updated as follows, including
the two new acquisitions closed in the quarter.
- Total revenues – excluding acquisitions closed to date during
fiscal 2011, we anticipate about 6% revenue growth, up from our
prior forecast of about 5% growth, due to positive results achieved
during the third quarter. Including acquisitions closed to date
during fiscal 2011, we anticipate about 10% revenue growth for the
year, up from our prior forecast of about 9% growth.
- Diluted earnings per share – we anticipate 6% to 7% growth in
earnings per share from continuing operations in fiscal 2011,
compared with $2.37 earnings per share from continuing operations
in fiscal 2010, which excludes favorable tax items, up from our
prior forecast of about 5% growth. Acquisitions, including
transaction and integration-related costs, are anticipated to be
dilutive to pretax margins. The reportable segments' results also
include a cost of capital charge related to the funding of
acquisitions which is eliminated in consolidation. We continue to
anticipate no significant impact to diluted earnings per share from
the acquisitions closed to date during fiscal 2011.
- Employer Services – excluding acquisitions closed to date
during fiscal 2011, we anticipate 5% to 6% revenue growth, up from
our prior forecast of about 5% growth, due to positive results
achieved during the third quarter. Including acquisitions closed to
date during fiscal 2011, we anticipate about 7% revenue growth,
which is at the high end of our prior forecast of 6% to 7% growth.
Excluding acquisitions closed to date during fiscal 2011, we
continue to anticipate up to 50 basis points of pretax margin
improvement. Updated for acquisitions closed during the third
quarter of fiscal 2011, pretax margin is anticipated to be flat
with a year ago, compared with our prior forecast of up to 20 basis
points of pretax margin improvement.
- Pays per control – up about 2.5% compared with our prior
forecast of up approximately 2.0%
- Client revenue retention – up approximately 1.0 percentage
point, up from our prior forecast of up over 0.5 percentage
point
- PEO Services – about 16% revenue growth, up from our prior
forecast of about 15% growth, driven primarily by higher benefits
pass through revenues. We continue to anticipate a decline in
pretax margin due to increased benefits pass through revenues and
the grow-over impact of last year's $9 million favorable state
unemployment tax settlement.
- Employer Services and PEO Services new business sales –
continue to anticipate high single-digit growth in fiscal 2011,
compared to $1.0 billion sold in fiscal 2010.
- Dealer Services – excluding acquisitions closed to date during
fiscal 2011, we anticipate about 3% revenue growth, which is at the
high end of our prior forecast of 2% to 3% revenue growth.
Excluding acquisitions, we continue to anticipate at least 50 basis
points of pretax margin improvement. Including acquisitions closed
to date during fiscal 2011, we continue to anticipate revenue
growth of over 20%. We anticipate a decline in pretax margin of 100
to 150 basis points, compared with our prior forecast of 150 to 200
basis points decline.
"Interest on funds held for clients is expected to be down about
$5 million from $542.8 million in fiscal 2010. This is based on an
approximate 30 to 40 basis point decline in the expected average
interest yield to about 3.2% to 3.3%, partially offset by 9% to 10%
growth in average client funds balances. This is updated from our
previously forecasted decline of $15 to $20 million, or 3% to 4%,
based on a 30 to 40 basis point decline in the average interest
yield and growth in average client funds balances of 7% to 8%. The
interest assumptions in our current forecasts are based on Fed
Funds futures contracts and forward yield curves as of April 29,
2011. The Fed Funds futures contracts do not anticipate any changes
during the fiscal year in the Fed Funds target rate. The
three-and-a-half and five-year U.S. government agency rates based
on the forward yield curves as of April 29, 2011 were used to
forecast new purchase rates for the client extended and client long
portfolios, respectively.
"I believe that the investments we continued to make over the
last couple years were the right ones to broaden our solution set,
expand our geographic presence, and strengthen ADP's competitive
position. ADP's results are strong and I am confident in our
ability to deliver strong revenue and earnings growth over our
strategic planning horizon," Mr. Butler concluded.
Website Schedules
The schedules of quarterly and full-year revenue and pretax
earnings by reportable segment for fiscal years 2009, 2010 and
fiscal 2011 have been updated for the third quarter of fiscal 2011
and have been posted to the Investor Relations home page
(http://www.investquest.com/iq/a/adp/index.htm) of our website
www.adp.com under Financial Data.
An analyst conference call will be held today, Monday, May 2 at
4:30 p.m. EDT. A live webcast of the call will be available to the
public on a listen-only basis. To listen to the webcast and view
the slide presentation, go to ADP's home page, www.adp.com, or
ADP's Investor Relations home page,
http://www.investquest.com/InvestQuest/a/adp/, and click on the
webcast icon. The presentation will be available to download and
print about 60 minutes before the webcast at the ADP Investor
Relations home page at
http://www.investquest.com/iq/a/adp/index.htm. ADP's news releases,
current financial information, SEC filings and Investor Relations
presentations are accessible at the same Web site.
About ADP
Automatic Data Processing, Inc. (Nasdaq:ADP), with nearly $9
billion in revenues and about 550,000 clients, is one of the
world's largest providers of business outsourcing solutions.
Leveraging over 60 years of experience, ADP offers a wide range of
HR, payroll, tax and benefits administration solutions from a
single source. ADP's easy-to-use, cost-effective solutions for
employers provide superior value to companies of all types and
sizes. ADP is also a leading provider of integrated computing
solutions to auto, truck, motorcycle, marine and recreational
vehicle dealers throughout the world. For more information about
ADP or to contact a local ADP sales office, reach us at
1.800.225.5237 or visit the company's Web site at www.ADP.com.
|
|
Automatic Data
Processing, Inc. and Subsidiaries |
Condensed Consolidated
Balance Sheets |
(In
millions) |
(Unaudited) |
|
|
|
|
March 31, 2011 |
June 30, 2010 |
|
|
|
Assets |
|
|
Cash and cash equivalents/Short-term
marketable securities |
$ 1,644.5 |
$ 1,671.2 |
Other current assets |
1,986.9 |
1,812.9 |
Total current assets
before funds held for clients |
3,631.4 |
3,484.1 |
|
|
|
Funds held for clients |
32,451.9 |
18,832.6 |
Total current
assets |
36,083.3 |
22,316.7 |
|
|
|
Long-term marketable securities |
96.6 |
104.3 |
Property, plant and equipment, net |
685.4 |
673.8 |
Other non-current assets |
4,731.1 |
3,767.4 |
Total assets |
$ 41,596.4 |
$ 26,862.2 |
|
|
|
Liabilities and Stockholders'
Equity |
|
|
Other current liabilities |
1,958.7 |
1,915.5 |
Client funds obligations |
32,015.4 |
18,136.7 |
Total current
liabilities |
33,974.1 |
20,052.2 |
|
|
|
Long-term debt |
34.6 |
39.8 |
Other non-current liabilities |
1,393.2 |
1,291.3 |
Total liabilities |
35,401.9 |
21,383.3 |
|
|
|
Total stockholders' equity |
6,194.5 |
5,478.9 |
Total liabilities and
stockholders' equity |
$ 41,596.4 |
$ 26,862.2 |
|
|
Automatic Data
Processing, Inc. and Subsidiaries |
Statements of
Consolidated Earnings |
(In millions, except per
share amounts) |
(Unaudited) |
|
|
Three Months Ended March
31, |
Nine Months Ended March
31, |
|
|
2011 |
2010 |
2011 |
2010 |
Revenues: |
|
|
|
|
Revenues, other than interest
on funds held for clients and PEO revenues |
$ 2,143.5 |
$ 1,919.3 |
$ 5,828.2 |
$ 5,355.1 |
Interest on funds held for
clients |
148.6 |
147.9 |
404.4 |
403.5 |
PEO revenues (A) |
445.2 |
376.0 |
1,139.8 |
978.8 |
Total
revenues |
2,737.3 |
2,443.2 |
7,372.4 |
6,737.4 |
|
|
|
|
|
Expenses: |
|
|
|
|
Costs of revenues: |
|
|
|
|
Operating expenses |
1,300.3 |
1,140.3 |
3,590.5 |
3,190.6 |
Systems development &
programming |
155.8 |
130.0 |
432.9 |
376.2 |
Depreciation &
amortization |
64.5 |
60.4 |
189.4 |
180.6 |
Total costs of revenues |
1,520.6 |
1,330.7 |
4,212.8 |
3,747.4 |
|
|
|
|
|
Selling, general &
administrative expenses |
577.3 |
504.9 |
1,663.0 |
1,515.5 |
Interest expense |
1.4 |
1.2 |
6.9 |
6.8 |
Total
expenses |
2,099.3 |
1,836.8 |
5,882.7 |
5,269.7 |
|
|
|
|
|
Other income, net |
(15.0) |
(26.6) |
(84.3) |
(90.0) |
|
|
|
|
|
Earnings from continuing operations
before income taxes |
653.0 |
633.0 |
1,574.0 |
1,557.7 |
|
|
|
|
|
Provision for income taxes |
229.2 |
231.4 |
561.6 |
558.0 |
|
|
|
|
|
Net earnings from continuing
operations |
$ 423.8 |
$ 401.6 |
$ 1,012.4 |
$ 999.7 |
|
|
|
|
|
Earnings from discontinued operations, net of
provision for income taxes of $6.1 and $7.0 or the three and nine
months ended March 31, 2010, respectively. |
-- |
2.0 |
-- |
3.8 |
|
|
|
|
|
Net earnings |
$ 423.8 |
$ 403.6 |
$ 1,012.4 |
$ 1,003.5 |
|
|
|
|
|
Basic Earnings Per Share from
Continuing Operations |
$ 0.85 |
$ 0.80 |
$ 2.05 |
$ 1.99 |
Basic Earnings Per Share from
Discontinued Operations |
-- |
-- |
-- |
0.01 |
Basic Earnings Per Share |
$ 0.85 |
$ 0.80 |
$ 2.05 |
$ 2.00 |
|
|
|
|
|
Diluted Earnings Per Share from
Continuing Operations |
$ 0.85 |
$ 0.79 |
$ 2.03 |
$ 1.98 |
Diluted Earnings Per Share from
Discontinued Operations |
-- |
-- |
-- |
0.01 |
DILUTED EARNINGS PER SHARE |
$ 0.85 |
$ 0.80 |
$ 2.03 |
$ 1.99 |
|
|
|
|
|
Dividends declared per common
share |
$ 0.3600 |
$ 0.3400 |
$ 1.0600 |
$ 1.0100 |
|
|
|
|
|
(A) Professional Employer
Organization ("PEO") revenues are net of direct pass-through costs,
primarily consisting of payroll wages and payroll taxes, of
$4,177.9 and $3,478.6 for the three months ended March 31, 2011 and
2010, respectively, and $11,760.6 and $10,094.1 for the nine months
ended March 31, 2011 and 2010, respectively. |
|
|
|
|
|
|
|
|
|
|
Automatic Data
Processing, Inc. and Subsidiaries |
Other Selected Financial
Data |
(Dollars in millions,
except per share amounts) |
(Unaudited) |
|
|
Three Months Ended March
31, |
|
|
|
2011 |
2010 |
Change |
% Change |
Revenues (A) |
|
|
|
|
Employer Services |
$ 1,925.1 |
$ 1,768.8 |
$ 156.3 |
9% |
PEO Services |
447.8 |
378.5 |
69.3 |
18% |
Dealer Services |
391.5 |
304.5 |
87.0 |
29% |
Other |
(27.1) |
(8.6) |
(18.5) |
(100)+% |
|
$ 2,737.3 |
$ 2,443.2 |
$ 294.1 |
12% |
Pre-tax earnings from
continuing operations (A) |
|
|
|
|
Employer Services |
$ 646.9 |
$ 600.2 |
$ 46.7 |
8% |
PEO Services |
37.8 |
30.0 |
7.8 |
26% |
Dealer Services |
67.5 |
58.6 |
8.9 |
15% |
Other |
(99.2) |
(55.8) |
(43.4) |
(78)% |
|
$ 653.0 |
$ 633.0 |
$ 20.0 |
3% |
Pre-tax margin (A) |
|
|
|
|
Employer Services |
33.6% |
33.9% |
(0.3)% |
|
PEO Services |
8.4% |
7.9% |
0.5% |
|
Dealer Services |
17.2% |
19.2% |
(2.0)% |
|
Other |
n/m |
n/m |
n/m |
|
|
23.9% |
25.9% |
(2.1)% |
|
|
|
|
|
|
|
Nine Months Ended March
31, |
|
|
|
2011 |
2010 |
Change |
% Change |
Revenues (A) |
|
|
|
|
Employer Services |
$ 5,147.3 |
$ 4,801.0 |
$ 346.3 |
7% |
PEO Services |
1,147.3 |
985.9 |
161.4 |
16% |
Dealer Services |
1,103.2 |
904.6 |
198.6 |
22% |
Other |
(25.4) |
45.9 |
(71.3) |
(100)+% |
|
$ 7,372.4 |
$ 6,737.4 |
$ 635.0 |
9% |
Pre-tax earnings from
continuing operations (A) |
|
|
|
|
Employer Services |
$ 1,455.1 |
$ 1,384.7 |
$ 70.4 |
5% |
PEO Services |
102.0 |
97.9 |
4.1 |
4% |
Dealer Services |
175.8 |
157.0 |
18.8 |
12% |
Other |
(158.9) |
(81.9) |
(77.0) |
(94)% |
|
$ 1,574.0 |
$ 1,557.7 |
$ 16.3 |
1% |
Pre-tax margin (A) |
|
|
|
|
Employer Services |
28.3% |
28.8% |
(0.6)% |
|
PEO Services |
8.9% |
9.9% |
(1.0)% |
|
Dealer Services |
15.9% |
17.4% |
(1.4)% |
|
Other |
n/m |
n/m |
n/m |
|
|
21.4% |
23.1% |
(1.8)% |
|
|
|
|
|
|
(A) Prior year's segment results
were adjusted to reflect fiscal year 2011 budgeted foreign exchange
rates. |
|
|
|
|
|
n/m - not meaningful |
|
|
|
|
|
|
Three Months Ended March
31, |
|
|
|
2011 |
2010 |
Change in other income, net |
|
Components of other income,
net: |
|
|
|
|
Interest income on corporate funds |
$ (10.0) |
$ (10.6) |
$ (0.6) |
|
Realized gains on available-for-sale
securities |
(5.4) |
(1.5) |
3.9 |
|
Realized losses on available-for-sale
securities |
1.0 |
0.9 |
(0.1) |
|
Realized gains on investment in the Reserve
Fund |
-- |
(14.8) |
(14.8) |
|
Other, net |
(0.6) |
(0.6) |
-- |
|
Total other income, net |
$ (15.0) |
$ (26.6) |
$ (11.6) |
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended March
31, |
|
|
|
2011 |
2010 |
Change in other income, net |
|
Components of other income,
net: |
|
|
|
|
Interest income on corporate funds |
$ (68.8) |
$ (78.2) |
$ (9.4) |
|
Realized gains on available-for-sale
securities |
(23.0) |
(11.7) |
11.3 |
|
Realized losses on available-for-sale
securities |
3.3 |
13.0 |
9.7 |
|
Realized gains on investment in the Reserve
Fund |
(0.9) |
(15.2) |
(14.3) |
|
Impairment losses on available-for-sale
securities |
-- |
5.3 |
5.3 |
|
Impairment losses on assets held for
sale |
8.6 |
-- |
(8.6) |
|
Gains on sales of buildings |
(1.8) |
(1.5) |
0.3 |
|
Other, net |
(1.7) |
(1.7) |
-- |
|
Total other income, net |
$ (84.3) |
$ (90.0) |
$ (5.7) |
|
|
|
|
|
|
|
Automatic Data
Processing, Inc. and Subsidiaries |
Other Selected Financial
Data, Continued |
(Dollars in millions,
except per share amounts or where otherwise stated) |
(Unaudited) |
|
Three Months Ended March
31, |
|
|
|
2011 |
2010 |
Change |
% Change |
Earnings per share information: |
|
|
|
|
Net earnings from continuing operations |
$ 423.8 |
$ 401.6 |
$ 22.2 |
6% |
Net earnings |
$ 423.8 |
$ 403.6 |
$ 20.2 |
5% |
Basic weighted average shares
outstanding |
496.2 |
502.4 |
(6.2) |
(1)% |
Basic earnings per share from continuing
operations |
$ 0.85 |
$ 0.80 |
$ 0.05 |
6% |
Basic earnings per share |
$ 0.85 |
$ 0.80 |
$ 0.05 |
6% |
|
|
|
|
|
Diluted net earnings from continuing
operations |
$ 423.8 |
$ 401.6 |
$ 22.2 |
6% |
Diluted net earnings |
$ 423.8 |
$ 403.6 |
$ 20.2 |
5% |
Diluted weighted average shares
outstanding |
501.3 |
505.5 |
(4.2) |
(1)% |
Diluted earnings per share from continuing
operations |
$ 0.85 |
$ 0.79 |
$ 0.06 |
8% |
Diluted earnings per share |
$ 0.85 |
$ 0.80 |
$ 0.05 |
6% |
|
|
|
|
|
|
Nine Months Ended March
31, |
|
|
|
2011 |
2010 |
Change |
% Change |
Earnings per share information: |
|
|
|
|
Net earnings from continuing operations |
$ 1,012.4 |
$ 999.7 |
$ 12.7 |
1% |
Net earnings |
$ 1,012.4 |
$ 1,003.5 |
$ 8.9 |
1% |
Basic weighted average shares
outstanding |
493.2 |
501.9 |
(8.7) |
(2)% |
Basic earnings per share from continuing
operations |
$ 2.05 |
$ 1.99 |
$ 0.06 |
3% |
Basic earnings per share |
$ 2.05 |
$ 2.00 |
$ 0.05 |
3% |
|
|
|
|
|
Diluted net earnings from continuing
operations |
$ 1,012.4 |
$ 999.7 |
$ 12.7 |
1% |
Diluted net earnings |
$ 1,012.4 |
$ 1,003.5 |
$ 8.9 |
1% |
Diluted weighted average shares
outstanding |
497.5 |
504.8 |
(7.3) |
(1)% |
Diluted earnings per share from continuing
operations |
$ 2.03 |
$ 1.98 |
$ 0.05 |
3% |
Diluted earnings per share |
$ 2.03 |
$ 1.99 |
$ 0.04 |
2% |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March
31, |
|
|
|
2011 |
2010 |
|
|
Key Statistics: |
|
|
|
|
Internal revenue growth: |
|
|
|
|
Employer Services |
7% |
1% |
|
|
PEO Services |
18% |
15% |
|
|
Dealer Services |
3% |
(4)% |
|
|
|
|
|
|
|
Employer Services: |
|
|
|
|
Change in pays per
control - AutoPay product |
2.7% |
(2.5)% |
|
|
Change in client revenue
retention percentage - worldwide |
1.9% |
1.4% |
|
|
Employer Services/PEO new
business sales growth - worldwide |
13% |
0% |
|
|
|
|
|
|
|
PEO Services: |
|
|
|
|
Paid PEO worksite
employees at end of period |
234,000 |
205,000 |
|
|
Average paid PEO worksite
employees during the period |
233,000 |
206,000 |
|
|
|
|
|
|
|
|
Nine Months Ended March
31, |
|
|
|
2011 |
2010 |
|
|
Key Statistics: |
|
|
|
|
Internal revenue growth: |
|
|
|
|
Employer Services |
5% |
(1)% |
|
|
PEO Services |
16% |
10% |
|
|
Dealer Services |
3% |
(5)% |
|
|
|
|
|
|
|
Employer Services: |
|
|
|
|
Change in pays per
control - AutoPay product |
2.3% |
(4.6)% |
|
|
Change in client revenue
retention percentage - worldwide |
1.4% |
0.1% |
|
|
Employer Services/PEO new
business sales growth - worldwide |
10% |
(1)% |
|
|
|
|
|
|
|
PEO Services: |
|
|
|
|
Paid PEO worksite
employees at end of period |
234,000 |
205,000 |
|
|
Average paid PEO worksite
employees during the period |
223,000 |
200,000 |
|
|
|
|
|
|
|
|
Automatic Data
Processing, Inc. and Subsidiaries |
Other Selected Financial
Data, Continued |
(Dollars in millions,
except per share amounts or where otherwise stated) |
(Unaudited) |
|
Three Months Ended March
31, |
|
|
|
2011 |
2010 |
Change |
% Change |
Average investment balances at cost (in
billions): |
|
|
|
|
Corporate, other than
corporate extended |
$ 1.4 |
$ 1.9 |
$ (0.5) |
(26)% |
Corporate extended |
0.7 |
0.7 |
-- |
1% |
Total corporate |
2.2 |
2.7 |
(0.5) |
(18)% |
Funds held for
clients |
20.6 |
18.4 |
2.2 |
12% |
Total |
$ 22.8 |
$ 21.1 |
$ 1.7 |
8% |
|
|
|
|
|
Average interest rates earned exclusive
of realized losses (gains) on: |
|
|
|
|
Corporate, other than
corporate extended |
1.1% |
0.7% |
|
|
Corporate extended |
3.2% |
3.9% |
|
|
Total corporate |
1.8% |
1.6% |
|
|
Funds held for
clients |
2.9% |
3.2% |
|
|
Total |
2.8% |
3.0% |
|
|
|
|
|
|
|
Net unrealized gain position at end of
period |
$ 466.5 |
$ 609.1 |
|
|
|
|
|
|
|
Average short-term financing (in
billions): |
|
|
|
|
U.S. commercial paper
borrowings |
$ 0.6 |
$ 0.6 |
|
|
U.S. & Canadian
reverse repurchase agreement borrowings |
0.2 |
0.1 |
|
|
|
$ 0.7 |
$ 0.7 |
|
|
|
|
|
|
|
Average interest rates paid on: |
|
|
|
|
U.S. commercial paper
borrowings |
0.2% |
0.2% |
|
|
U.S. & Canadian
reverse repurchase agreement borrowings |
0.8% |
0.2% |
|
|
|
|
|
|
|
|
|
|
|
|
Interest on funds held for clients |
$ 148.6 |
$ 147.9 |
$ 0.7 |
0.5% |
Corporate extended interest income (B) |
6.0 |
7.2 |
(1.1) |
(16)% |
Corporate interest expense-short-term
financing (B) |
(0.7) |
(0.3) |
(0.3) |
(100)+% |
|
$ 154.0 |
$ 154.8 |
$ (0.8) |
0% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended March
31, |
|
|
|
2011 |
2010 |
Change |
% Change |
Average investment balances at cost (in
billions): |
|
|
|
|
Corporate, other than
corporate extended |
$ 1.3 |
$ 1.7 |
$ (0.4) |
(21)% |
Corporate extended |
2.2 |
2.2 |
-- |
(1)% |
Total corporate |
3.5 |
3.9 |
(0.4) |
(10)% |
Funds held for
clients |
16.3 |
14.8 |
1.5 |
10% |
Total |
$ 19.8 |
$ 18.7 |
$ 1.1 |
6% |
|
|
|
|
|
Average interest rates earned exclusive of
realized losses (gains) on: |
|
|
|
|
Corporate, other than
corporate extended |
1.0% |
0.9% |
|
|
Corporate extended |
3.6% |
4.1% |
|
|
Total corporate |
2.6% |
2.7% |
|
|
Funds held for
clients |
3.3% |
3.6% |
|
|
Total |
3.2% |
3.4% |
|
|
|
|
|
|
|
Net unrealized gain position at end of
period |
$ 466.5 |
$ 609.1 |
|
|
|
|
|
|
|
Average short-term financing (in
billions): |
|
|
|
|
U.S. commercial paper
borrowings |
$ 1.7 |
$ 1.8 |
|
|
U.S. & Canadian
reverse repurchase agreement borrowings |
0.4 |
0.4 |
|
|
|
$ 2.2 |
$ 2.2 |
|
|
|
|
|
|
|
Average interest rates paid on: |
|
|
|
|
U.S. commercial paper
borrowings |
0.2% |
0.2% |
|
|
U.S. & Canadian
reverse repurchase agreement borrowings |
0.5% |
0.2% |
|
|
|
|
|
|
|
|
|
|
|
|
Interest on funds held for clients |
$ 404.4 |
$ 403.5 |
$ 0.9 |
0.2% |
Corporate extended interest income (B) |
57.9 |
67.5 |
(9.5) |
(14)% |
Corporate interest expense-short-term
financing (B) |
(4.8) |
(3.2) |
(1.6) |
(50)% |
|
$ 457.6 |
$ 467.8 |
$ (10.2) |
(2)% |
|
|
|
|
|
(B) While "Corporate
extended interest income" and "Corporate interest
expense-short-term financing" are non-GAAP disclosures, management
believes this information is beneficial to reviewing the financial
statements of ADP. Management believes this information is
beneficial as it allows the reader to understand the extended
investment strategy for ADP's client funds assets, corporate
investments and short-term borrowings. A reconciliation of the
non-GAAP measures to GAAP measures is as follows: |
|
|
|
|
|
|
|
|
Automatic Data
Processing, Inc. and Subsidiaries |
|
|
Other Selected Financial
Data, Continued |
|
|
(Dollars in millions,
except per share amounts or where otherwise stated) |
|
|
(Unaudited) |
|
|
|
|
|
|
|
Three Months Ended March
31, |
|
|
|
2011 |
2010 |
|
|
|
|
|
|
|
Corporate extended interest income |
$ 6.0 |
$ 7.2 |
|
|
All other interest income |
4.0 |
3.4 |
|
|
Total interest income on
corporate funds |
$ 10.0 |
$ 10.6 |
|
|
|
|
|
|
|
Corporate interest expense - short-term
financing |
$ 0.7 |
$ 0.3 |
|
|
All other interest expense |
0.7 |
0.9 |
|
|
Total interest
expense |
$ 1.4 |
$ 1.2 |
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended March
31, |
|
|
|
2011 |
2010 |
|
|
|
|
|
|
|
Corporate extended interest income |
$ 57.9 |
$ 67.5 |
|
|
All other interest income |
10.9 |
10.7 |
|
|
Total interest income on
corporate funds |
$ 68.8 |
$ 78.2 |
|
|
|
|
|
|
|
Corporate interest expense - short-term
financing |
$ 4.8 |
$ 3.2 |
|
|
All other interest expense |
2.1 |
3.6 |
|
|
Total interest
expense |
$ 6.9 |
$ 6.8 |
|
|
|
|
Automatic Data
Processing, Inc. and Subsidiaries |
Consolidated Statements
of Adjusted / Non-GAAP Financial Information |
(In millions, except per
share amounts) |
(Unaudited) |
|
|
|
|
|
The following table reconciles
the Company's results for the nine months ended March 31, 2010 and
for the twelve months ended June 30, 2010 to adjusted results that
exclude the impact of favorable tax items. The Company uses certain
adjusted results, among other measures, to evaluate the Company's
operating performance in the absence of certain items and for
planning and forecasting of future periods. The Company believes
that the adjusted results provide relevant and useful information
for investors because it allows investors to view performance in a
manner similar to the method used by the Company's management,
improves their ability to understand the Company's operating
performance and makes it easier to compare the Company's results
with other companies. Since adjusted earnings from continuing
operations and adjusted diluted EPS are not measures of performance
calculated in accordance with U.S. GAAP, they should not be
considered in isolation of, or as a substitute for, earnings from
continuing operations and diluted EPS from continuing operations
and they may not be comparable to similarly titled measures
employed by other companies. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended March
31, 2010 |
|
Earnings from continuing operations
before income taxes |
Provision for income taxes |
Net earnings from continuing
operations |
Diluted EPS from continuing
operations |
|
|
|
|
|
As Reported |
$ 1,557.7 |
$ 558.0 |
$ 999.7 |
$ 1.98 |
|
|
|
|
|
Adjustments: |
|
|
|
|
Favorable tax items |
|
12.2 |
12.2 |
0.02 |
|
|
|
|
|
As Adjusted |
$ 1,557.7 |
$ 570.2 |
$ 987.5 |
$ 1.96 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended June
30, 2010 |
|
Earnings from continuing operations
before income taxes |
Provision for income taxes |
Net earnings from continuing
operations |
Diluted EPS from continuing
operations |
|
|
|
|
|
As Reported |
$ 1,863.2 |
$ 655.9 |
$ 1,207.3 |
$ 2.40 |
|
|
|
|
|
Adjustments: |
|
|
|
|
Favorable tax items |
-- |
12.2 |
12.2 |
0.02 |
|
|
|
|
|
As Adjusted |
$ 1,863.2 |
$ 668.1 |
$ 1,195.1 |
$ 2.37 |
|
|
|
|
|
This document and other written or oral statements made from
time to time by ADP may contain "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. Statements that are not historical in nature and which may be
identified by the use of words like "expects," "assumes,"
"projects," "anticipates," "estimates," "we believe," "could be"
and other words of similar meaning, are forward-looking statements.
These statements are based on management's expectations and
assumptions and are subject to risks and uncertainties that may
cause actual results to differ materially from those expressed.
Factors that could cause actual results to differ materially from
those contemplated by the forward-looking statements include: ADP's
success in obtaining, retaining and selling additional services to
clients; the pricing of products and services; changes in laws
regulating payroll taxes, professional employer organizations and
employee benefits; overall market and economic conditions,
including interest rate and foreign currency trends; competitive
conditions; auto sales and related industry changes; employment and
wage levels; changes in technology; availability of skilled
technical associates and the impact of new acquisitions and
divestitures. ADP disclaims any obligation to update any
forward-looking statements, whether as a result of new information,
future events or otherwise. These risks and uncertainties, along
with the risk factors discussed under "Item 1A - Risk Factors" in
our Annual Report on Form 10-K for the fiscal year ended June 30,
2010, should be considered in evaluating any forward-looking
statements contained herein.
CONTACT: Automatic Data Processing, Inc.
ADP Investor Relations
Elena Charles, 973.974.4077
Debbie Morris, 973.974.7821
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