Automatic Data Processing, Inc. Earnings Cheat Sheet: Revenue Up, Profit Up
S&P 500 (NYSE:SPY) component Automatic Data Processing, Inc. (NASDAQ:ADP) reported higher profit for the fourth quarter as revenue showed growth. Automatic Data Processing, Inc. offers human resource, payroll, tax and benefits administration solutions to a wide range of clients.
Automatic Data Processing Earnings Cheat Sheet for the Fourth Quarter
Results: Net income for Automatic Data Processing, Inc. rose to $241.8 million (48 cents per share) vs. $207.9 million (41 cents per share) in the same quarter a year earlier. This marks a rise of 16.3% from the year earlier quarter.
Revenue: Rose 14% to $2.51 billion from the year earlier quarter.
Actual vs. Wall St. Expectations: ADP fell in line with the mean analyst estimate of 48 cents per share. It beat the average revenue estimate of $2.44 billion.
Quoting Management: Commenting on the results, Mr. Butler said, “ADP achieved very good results for fiscal 2011.Our key business metrics continued to trend positively and were the strongest they have been in three years.As anticipated, new business sales growth for Employer Services and PEO Services was solid in the fourth quarter, and we attained our sales target for the year of nearly $1.1 billion in expected, annualized recurring revenues.Employer Services’ client revenue retention also improved for the fourth quarter from a year ago, resulting in a record high retention level of just over 91% for the year.The automotive marketplace continued to steadily recover and Dealer Services posted very strong new business sales exiting the year.”
Revenue has now gone up for three straight quarters. In the third quarter, revenue rose 12.8% to $2.59 billion while the figure rose 9.6% in the second quarter from the year earlier.
The company has now fallen in line with estimates for the past two quarters. It reported net income of 85 cents in the third quarter.
Net income has dropped 4.7% year over year on average across the last five quarters. Performance was hurt by a 41% decline in the fourth quarter of the last fiscal year from the year earlier quarter.
Competitors to Watch: Paychex, Inc. (NASDAQ:PAYX), CBIZ, Inc. (NYSE:CBZ), Equifax Inc. (NYSE:EFX), McMillan Shakespeare Ltd. (NYSE:MMS), Blue Tax Group SA (NYSE:BTG), Colliers SA Holdings Ltd. (NYSE:COL).
(Source: Xignite Financials)