EX-99 2 ex99-1form8k_021506.txt EXHIBIT 99.1 EXHIBIT 99.1 ------------
AUTOMATIC DATA PROCESSING, INC. REVENUE FROM CONTINUING OPERATIONS BY BUSINESS SEGMENT SECURITIES CLEARING & FISCAL YEAR ES BROKERAGE DEALER OUTSOURCING SERVICES -------------- -------------------- --------------------- ---------------------- ------------------------- $ % $ % $ % $ % '03 Q1 1,024.9 5% 336.2 (8)% 197.7 9% Q2 1,081.6 5% 301.3 (18)% 204.1 13% Q3 1,259.1 7% 381.2 (18)% 211.8 16% Q4 1,094.9 9% 514.7 (11)% 210.7 13% -------------------- --------------------- ---------------------- ------------------------- Year 4,460.5 7% 1,533.4 (14)% 824.3 13% - - ==================== ==================== ====================== ========================= '04 Q1 1,124.4 10% 296.9 (12)% 213.5 8% Q2 1,174.0 9% 321.5 7% 220.9 8% Q3 1,383.0 10% 429.1 13% 228.2 8% Q4 1,190.0 9% 539.0 5% 237.7 13% -------------------- --------------------- ---------------------- ------------------------- Year 4,871.5 9% 1,586.5 3% 900.3 9% - - ==================== ===================== ====================== ========================= '05 Q1 1,190.4 6% 313.0 5% 240.3 13% - - Q2 1,250.3 6% 338.8 5% 245.8 11% 15.4 - Q3 1,510.5 9% 455.1 6% 249.2 9% 21.8 - Q4 1,310.1 10% 571.9 6% 255.4 7% 24.3 - -------------------- --------------------- ---------------------- ------------------------- Year 5,261.3 8% 1,678.9 6% 990.6 10% 61.5 - ==================== ===================== ====================== ========================= '06 Q1 1,299.4 9% 354.6 13% 253.8 6% 17.7 - Q2 1,372.5 10% 366.3 8% 270.0 10% 19.8 29% -------------------- --------------------- ---------------------- ------------------------- Year 2,671.9 9% 720.9 11% 523.8 8% 37.5 100%+ ==================== ===================== ====================== ========================= RECONCILING ITEMS ---------------------------- FOREIGN CLIENT FUND FISCAL YEAR OTHER EXCHANGE INTEREST TOTAL -------------- ----------------------------------------------------- ------------------------- $ % $ $ $ % '03 Q1 22.5 11% (51.8) 1.8 1,531.3 3% Q2 43.0 8% (53.9) (4.6) 1,571.5 0% Q3 3.2 100%+ (46.5) (19.3) 1,789.5 2% Q4 26.7 100%+ (27.2) (19.1) 1,800.7 4% ------------------------------------------------------ ------------------------- Year 95.4 4% (179.4) (41.2) 6,693.0 2% ===================================================== ========================= '04 Q1 22.9 2% (24.5) (20.7) 1,612.5 5% Q2 36.5 (15)% (12.8) (26.0) 1,714.1 9% Q3 6.7 100%+ (0.4) (51.0) 1,995.6 12% Q4 43.4 62% (10.2) (42.8) 1,957.1 9% ----------------------------------------------------- ------------------------- Year 109.5 14% (47.9) (140.5) 7,279.4 9% ===================================================== ========================= '05 Q1 25.1 9% (5.1) (29.9) 1,733.8 8% Q2 36.8 0% 9.7 (29.0) 1,867.8 9% Q3 (0.2) (100%)+ 17.8 (39.2) 2,215.0 11% Q4 22.9 (47)% 10.9 (28.4) 2,167.1 11% ----------------------------------------------------- ------------------------- Year 84.5 (23)% 33.3 (126.4) 7,983.7 10% ===================================================== ========================= '06 Q1 11.9 (52)% 4.3 (20.0) 1,921.7 11% Q2 31.8 (13)% 3.3 (16.3) 2,047.4 10% ----------------------------------------------------- ------------------------- Year 43.7 (29)% 7.6 (36.3) 3,969.1 10% ===================================================== =========================
* Quarter and YTD amounts are rounded amounts. As a result, the YTD total may not foot. Amounts will foot across, but the sum of the quarters may not foot to YTD.
AUTOMATIC DATA PROCESSING, INC. PRE-TAX EARNINGS FROM CONTINUING OPERATIONS BY BUSINESS SEGMENT FISCAL YEAR ES BROKERAGE DEALER --------------- ------------------------------- ----------------------------------------------------------------- PRE-TAX PRE-TAX PRE-TAX $ % MARGIN $ % MARGIN $ % MARGIN ----------- ------ --------- ---------- -------- -------- ------- ------ -------- '03 Q1 213.2 13% 21% 57.0 (17)% 17% 30.0 7% 15% Q2 269.6 10% 25% 37.2 (45)% 12% 35.1 13% 17% Q3 414.1 16% 33% 49.2 (46)% 13% 36.2 17% 17% Q4 177.1 (13)% 16% 102.1 (28)% 20% 36.4 21% 17% ------------------------------- ----------------------------------------------------------------- Year 1,074.0 8% 24% 245.7 (33)% 16% 137.7 15% 17% =============================== ================================================================= '04 Q1 206.9 (3)% 18% 23.2 (59)% 8% 32.5 9% 15% Q2 263.8 (2)% 22% 34.3 (8)% 11% 37.2 6% 17% Q3 387.7 (6)% 28% 67.7 37% 16% 39.7 10% 17% Q4 139.6 (21)% 12% 125.6 23% 23% 35.9 (1)% 15% ------------------------------- ----------------------------------------------------------------- Year 998.0 (7)% 20% 250.8 2% 16% 145.3 6% 16% =============================== ================================================================= '05 Q1 220.3 6% 19% 41.4 78% 13% 36.2 11% 15% Q2 284.9 8% 23% 50.6 48% 15% 38.5 3% 16% Q3 452.9 17% 30% 71.6 6% 16% 38.0 (4)% 15% Q4 191.3 37% 15% 137.5 9% 24% 37.1 3% 15% ------------------------------- ----------------------------------------------------------------- Year 1,149.3 15% 22% 301.1 20% 18% 149.8 3% 15% =============================== ================================================================= '06 Q1 271.4 23% 21% 53.5 29% 15% 41.1 14% 16% Q2 309.5 9% 23% 53.5 6% 15% 40.2 4% 15% ------------------------------- ----------------------------------------------------------------- Year 581.0 15% 22% 106.9 16% 15% 81.3 9% 16% =============================== ================================================================= SECURITIES CLEARING & FISCAL YEAR OUTSOURCING SERVICES OTHER --------------- ----------------------------- --------------------------------- PRE-TAX PRE-TAX $ % MARGIN $ % MARGIN -------- ------ --------- ---------- -------- --------- '03 Q1 0.4 100%+ 2% Q2 47.8 65% 100%+ Q3 18.6 (65)% 100%+ Q4 30.8 (39)% 100%+ ----------------------------- --------------------------------- Year - - - 97.3 (5)% 100%+ ============================= ================================= '04 Q1 23.6 100%+ 100%+ Q2 11.0 (77)% 30% Q3 (8.1) (100%)+ (100%)+ Q4 36.4 18% 84% ----------------------------- --------------------------------- Year - - 62.9 (35)% 58% ============================= ================================= '05 Q1 - - - 10.5 (56)% 42% Q2 (5.2) - (34)% (0.8) (100%)+ (2%) Q3 (9.3) - (43)% (40.6) (100%)+ (100%)+ Q4 (9.1) - (38)% 33.5 (8)% 100%+ ----------------------------- --------------------------------- Year (23.6) - (38)% 2.6 (96)% 3% ============================= ================================= '06 Q1 (11.8) - (67)% (37.5) (100%)+ (100%)+ Q2 (7.6) (46)% (38)% (1.6) (96)% (5)% ----------------------------- --------------------------------- Year (19.4) (100%)+ (52)% (39.1) (100%)+ (90)% ============================= ================================= RECONCILING ITEMS ----------------------------------------- COST OF FOREIGN CLIENT FUND CAPITAL FISCAL YEAR EXCHANGE INTEREST CHARGE TOTAL -------------- ----------------------------------------- ---------------------------------- PRE-TAX $ $ $ $ % MARGIN ---------- ----------- --------- ---------------------------------- '03 Q1 (4.0) 1.8 26.2 324.6 7% 21% Q2 (6.1) (4.5) 28.2 407.3 (2)% 26% Q3 (9.4) (19.3) 23.4 512.8 (8)% 29% Q4 (0.7) (19.1) 22.8 349.4 (23)% 19% ---------- ----------- --------- ---------------------------------- Year (20.1) (41.2) 100.6 1,594.0 (8)% 24% ========== =========== ========= ================================== '04 Q1 (2.8) (20.7) 30.9 293.6 (10)% 18% Q2 (1.6) (26.0) 30.8 349.5 (14)% 20% Q3 (0.7) (51.0) 31.6 466.9 (9)% 23% Q4 (2.0) (42.8) 32.1 324.8 (7)% 17% ---------- ----------- --------- ---------------------------------- Year (7.1) (140.5) 125.5 1,434.9 (10)% 20% ========== =========== ========= ================================== '05 Q1 (0.8) (29.9) 31.8 309.5 5% 18% Q2 2.1 (29.0) 35.4 376.5 8% 20% Q3 3.5 (39.2) 32.3 509.2 9% 23% Q4 1.0 (28.3) 34.9 397.9 23% 18% ---------- ----------- --------- ---------------------------------- Year 5.8 (126.4) 134.5 1,593.1 11% 20% ========== =========== ========= ================================== '06 Q1 1.1 (20.0) 34.3 332.1 7% 17% Q2 1.9 (16.3) 35.3 414.9 10% 20% ---------- ----------- --------- ---------------------------------- Year 3.0 (36.3) 69.6 747.0 9% 19% ========== =========== ========= ==================================
* Quarter and YTD amounts are rounded amounts. As a result, the YTD total may not foot. Amounts will foot across, but the sum of the quarters may not foot to YTD. NOTE: Earnings from continuing operations before income taxes for fiscal years 2003, 2004 and 2005 have not been adjusted for the impact of stock compensation expense.
AUTOMATIC DATA PROCESSING, INC. AND SUBSIDIARIES FISCAL 2005 QUARTERLY DETAIL, AS ADJUSTED FOR STOCK COMPENSATION EXPENSE (IN MILLIONS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED) FISCAL YEAR 2005 ------------------------------------------------------------------ Q1 Q2 Q3 Q4 YEAR ------------------------------------------------------------------ CONTINUING OPERATIONS: Operating expenses 821.9 864.6 1,015.5 1,062.9 3,764.8 Plus: Pro forma operating expenses impact of stock compensation expense 10.8 9.6 9.5 9.0 38.8 ------------------------------------------------------------------ Operating expenses, as adjusted 832.7 874.2 1,025.0 1,071.9 3,803.6 ================================================================== SG&A expenses 416.7 437.4 485.5 493.3 1,832.8 Plus: Pro forma SG&A expenses impact of stock compensation expense 24.7 24.4 20.2 23.5 92.8 ------------------------------------------------------------------ SG&A expenses, as adjusted 441.4 461.8 505.7 516.8 1,925.6 ================================================================== S&P expenses 131.2 132.1 136.5 150.5 550.3 Plus: Pro forma S&P expenses impact of stock compensation expense 11.5 10.1 10.1 9.6 41.4 ------------------------------------------------------------------ S&P expenses, as adjusted 142.7 142.2 146.6 160.1 591.7 ================================================================== Pre-tax income 309.5 376.5 509.2 397.9 1,593.1 Less: Pro forma Pre-tax income impact of stock compensation expense 47.0 44.1 39.8 42.1 173.0 ------------------------------------------------------------------ Pre-tax income, as adjusted 262.5 332.4 469.4 355.8 1,420.1 ================================================================== Provision for income taxes 115.8 140.6 190.2 148.2 594.8 Less: Pro forma Provision for income taxes impact of stock compensation expense 13.3 12.3 11.1 11.9 48.5 ------------------------------------------------------------------ Provision for income taxes, as adjusted 102.5 128.3 179.1 136.3 546.3 ================================================================== Net earnings 193.7 235.9 319.0 249.7 998.3 Less: Pro forma Net earnings impact of stock compensation expense 33.7 31.8 28.7 30.2 124.5 ------------------------------------------------------------------ Net earnings, as adjusted 160.0 204.1 290.3 219.5 873.8 ================================================================== Diluted EPS 0.33 0.40 0.54 0.42 1.69 Less: Pro forma EPS impact of stock compensation expense (0.06) (0.05) (0.05) (0.05) (0.21) Diluted EPS, assuming stock compensation expensed in ------------------------------------------------------------------ respective periods 0.27 0.35 0.49 0.37 1.48 ================================================================== DISCONTINUED OPERATIONS: Pro forma stock-based compensation expense, net of tax, relating to discontinued operations 2.0 1.8 1.6 1.7 7.1 ==================================================================
NOTE: THE ABOVE AMOUNTS ARE ROUNDED AND AS A RESULT THE SUM OF THE QUARTERS MAY NOT FOOT TO THE YEAR.
AUTOMATIC DATA PROCESSING, INC. AND SUBSIDIARIES QUARTERLY DETAIL, RESTATED FOR DISCONTINUED OPERATIONS (IN MILLIONS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED) FISCAL YEAR 2005 FISCAL YEAR 2006 -------------------------------------------------------------- ----------------------- Q1 Q2 Q3 Q4 YEAR Q1 Q2 -------------------------------------------------------------- ----------------------- Revenues, other than interest on funds held for Employer Services' clients and PEO revenues $ 1,523.6 $ 1,643.3 $ 1,926.3 $ 1,892.1 $ 6,985.3 $ 1,657.5 $ 1,765.0 Interest on funds held for Employer Services' clients 84.7 91.1 124.5 121.1 421.4 108.4 118.9 PEO revenues 125.5 133.4 164.2 153.9 577.0 155.8 163.5 ---------- ---------- ---------- ---------- ---------- ---------- ---------- Total revenues 1,733.8 1,867.8 2,215.0 2,167.1 7,983.7 1,921.7 2,047.4 ---------- ---------- ---------- ---------- ---------- ---------- ---------- Operating expenses 821.9 864.6 1,015.5 1,062.9 3,764.8 925.4 962.4 Selling, general and administrative expenses 416.7 437.4 485.5 493.3 1,832.8 454.5 460.7 Systems development and programming costs 131.2 132.1 136.5 150.5 550.3 142.0 145.9 Depreciation and amortization 66.6 68.0 69.6 69.6 273.9 70.1 72.5 Other income, net (12.1) (10.8) (1.3) (7.1) (31.2) (2.4) (9.0) ---------- ---------- ---------- ---------- ---------- ---------- ---------- Total expenses 1,424.3 1,491.3 1,705.8 1,769.2 6,390.6 1,589.6 1,632.5 ---------- ---------- ---------- ---------- ---------- ---------- ---------- Earnings from continuing operations before income taxes 309.5 376.5 509.2 397.9 1,593.1 332.1 414.9 Provision for income taxes 115.8 140.6 190.2 148.2 594.8 126.0 157.2 ---------- ---------- ---------- ---------- ---------- ---------- ---------- Net earnings from continuing operations $ 193.7 $ 235.9 $ 319.0 $ 249.7 $ 998.3 $ 206.1 $ 257.7 ---------- ---------- ---------- ---------- ---------- ---------- ---------- Loss (income) from discontinued operations, net of income taxes (14.5) (14.2) (19.4) (9.0) (57.1) (13.9) (2.0) ---------- ---------- ---------- ---------- ---------- ---------- ---------- Net earnings $ 208.2 $ 250.1 $ 338.4 $ 258.7 $ 1,055.4 $ 220.0 $ 259.7 ========== ========== ========== ========== ========== ========== ========== Basic earnings per share from continuing operations $ 0.33 $ 0.40 $ 0.55 $ 0.43 $ 1.71 $ 0.36 $ 0.45 Basic earnings per share from discontinued operations $ 0.02 $ 0.02 $ 0.03 $ 0.02 $ 0.10 $ 0.02 $ 0.00 ========== ========== ========== ========== ========== ========== ========== Basic earnings per share $ 0.36 $ 0.43 $ 0.58 $ 0.44 $ 1.81 $ 0.38 $ 0.45 ========== ========== ========== ========== ========== ========== ========== Diluted earnings per share from continuing operations $ 0.33 $ 0.40 $ 0.54 $ 0.42 $ 1.69 $ 0.35 $ 0.44 Diluted earnings per share from discontinued operations $ 0.02 $ 0.02 $ 0.03 $ 0.02 $ 0.10 $ 0.02 $ 0.00 ========== ========== ========== ========== ========== ========== ========== Diluted earnings per share $ 0.35 $ 0.42 $ 0.57 $ 0.44 $ 1.79 $ 0.38 $ 0.45 ========== ========== ========== ========== ========== ========== ========== Dividends per common share $ 0.1400 $ 0.1550 $ 0.1550 $ 0.1550 $ 0.6050 $ 0.1550 $ 0.1850 ========== ========== ========== ========== ========== ========== ==========
NOTE: THE ABOVE AMOUNTS ARE ROUNDED AND AS A RESULT THE SUM OF THE QUARTERS MAY NOT FOOT TO THE YEAR. SEGMENT INFORMATION Employer Services, Brokerage Services, Dealer Services, and Securities Clearing & Outsourcing Services are ADP's reportable segments. ADP evaluates the performance of its segments based on operating results before interest on corporate funds, foreign currency gains and losses, and income taxes. Certain revenues and expenses are charged to the segments at a standard rate for management reasons. Other costs are recorded based on management responsibility. The prior years' segment revenues and earnings from continuing operations before income taxes have been adjusted to reflect updated fiscal year 2006 budgeted foreign exchange rates. Reconciling items include foreign exchange differences between the actual foreign exchange rates and the fiscal year 2006 budgeted foreign exchange rates and the adjustment for the difference between actual interest income earned on invested funds held for clients and interest credited to Employer Services at a standard rate of 4.5%. The segment results also include an internal cost of capital charge related to the funding of acquisitions and other investments. This charge is eliminated in consolidation and as such represents a reconciling item to earnings before income taxes. The tables attached show the adjusted quarterly segment revenues and earnings from continuing operations before income taxes and reconciling items for fiscal years 2003, 2004 and 2005, as well as the percentage difference between each period indicated and the same respective prior year period. Earnings from continuing operations before income taxes for fiscal years 2003, 2004 and 2005 have not been adjusted for the impact of stock compensation expense. Fiscal years 2003, 2004, 2005 and the first and second quarters of 2006 (Q1 '06 and Q2 '06) were restated to reflect revenues and earnings before income taxes from continuing operations as a result of the decision to sell the Brokerage Services financial print business and the Claims Services business.