Summary
Automatic Data Processing, Inc. (ADP) reported a solid third quarter for fiscal year 2008, with total revenues growing 12% to $2.43 billion and net earnings from continuing operations increasing 12% to $403.6 million. Diluted earnings per share from continuing operations rose 18% to $0.77. The company demonstrated strong operational performance across its key segments, notably Employer Services and PEO Services, which saw significant revenue growth. ADP continues to focus on returning value to shareholders, evidenced by ongoing share repurchases and dividend payments. The company's financial position remains robust, with healthy operating cash flow and a strong liquidity position. While managing various operational expenses, ADP's strategic divestitures of non-core assets appear to be contributing to a more focused and potentially higher-growth business.
Key Highlights
- 1Total revenues increased 12% to $2.43 billion for the three months ended March 31, 2008.
- 2Net earnings from continuing operations grew 12% to $403.6 million.
- 3Diluted EPS from continuing operations increased 18% to $0.77.
- 4Employer Services revenue grew 9%, PEO Services revenue grew 20%, and Dealer Services revenue grew 8% year-over-year.
- 5The company continued its share repurchase program, with 5.9 million shares repurchased during the quarter.
- 6Despite increased operating expenses, the company maintained its overall margin for continuing operations.
- 7ADP reported no exposure to sub-prime mortgages or collateralized debt obligations in its investment portfolio.