Paychex Inc. (NASD: PAYX) reported last week that revenue rose 4% in its fiscal first quarter ended Aug. 31. The company also reported in a filing with the US Securities and Exchange Commission that it paid $75.4 million for its previously announced acquisition of PEO provider HR Outsourcing Holdings Inc.

The purchase price for HR Outsourcing Holdings included $42.2 million in cash and $33.2 million in Paychex common stock.

Rochester, NY-based Paychex provides payroll processing, professional employer organization services and other services.

In its “human resource services” division, which include PEO and other services, first-quarter revenue rose 7%, primarily driven by increases in its client base across most major human capital management services, including comprehensive HR outsourcing services; retirement services; time and attendance; and insurance services. The growth was tempered by a challenging comparison to the prior year period which benefited from tailwinds from the implementation of the Affordable Care Act.

Revenue in Paychex’s Payroll Services division, which provides payroll processing and other services, rose 2%.

The company is also planning a new campus in Rochester at an estimated cost of $60 million, according to the SEC filing.

Quote

“We continued to experience strong demand for our HR outsourcing solutions,” President and CEO Martin Mucci said. “This demand, along with our recently announced acquisition of HR Outsourcing, Inc., a national professional employer organization serving small- to mid-sized businesses, positions us for continued growth.”

Guidance

Human resource services revenue is anticipated to increase in the range of 12% to 14% for the fiscal year ending May 31, 2018. Total revenue, including interest on funds held for clients, is expected to increase approximately 6%.