ADP (ADP) Tops Q2 EPS by 23c, Offers Outlook

ADP (NASDAQ: ADP) reported Q2 EPS of $1.52, $0.23 better than the analyst estimate of $1.29. Revenue for the quarter came in at $3.7 billion versus the consensus estimate of $3.57 billion.

Fiscal 2021 Outlook:

Certain components of ADP’s fiscal 2021 outlook and related growth comparisons exclude the impact of the following items and are discussed on an adjusted basis where applicable. Please refer to the accompanying financial tables for a reconciliation of these adjusted amounts to their closest comparable GAAP measure.

•Fiscal 2020 pre-tax charges totaling $128 million related to transformation initiatives, severance charges and charges related to the settlement of certain legal matters
•Fiscal 2021 expected pre-tax charges of about $25 million related to transformation initiatives

Consolidated Fiscal 2021 Outlook

•Revenue growth of 1% to 3%
•Adjusted EBIT margin decline of (100) to (50) basis points
•Adjusted effective tax rate of 23.0%
•Diluted EPS growth of 1% to 5%
•Adjusted diluted EPS growth of (2)% to 2%

Employer Services Segment Fiscal 2021 Outlook

•Employer Services revenue growth of flat to 2%
•Employer Services margin decline of (100) to (50) basis points
•Employer Services New Business Bookings growth of 15% to 25%
•Employer Services client revenue retention increase of approximately 100 basis points
•Decrease in U.S. pays per control of (4)% to (3)%

PEO Services Segment Fiscal 2021 Outlook

•PEO Services revenue growth of 3% to 5%
•PEO Services revenue, excluding zero-margin benefits, growth of 3% to 5%
•PEO Services margin increase of 50 to 100 basis points
•PEO Services Average Worksite Employee count growth of flat to 2%

For earnings history and earnings-related data on ADP (ADP) click here.

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