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PEO revenue at ADP rises 6%

November 04, 2009
Staffing Industry Analysts North American Daily News

Professional employer organization revenue at Automatic Data Processing Inc. (NASD: ADP) rose 6.1% on a year-over-year basis to $293.9 million in the company's fiscal first quarter ended Sept. 30.

The increase was brought by higher benefits pass-through revenue from increases in benefit rates and the number of worksite employees, according to the company. The number of worksite employees rose by 3% to 195,000.

ADP also said a state unemployment tax settlement increased PEO pre-tax earnings by $9 million.

The company estimates PEO revenue will grow 4% to 6% in this fiscal year compared to the last. New PEO business sales will be about flat.

ADP reports PEO revenue on a net basis, excluding payroll wages and taxes.

PEO services is just one of Roseland NJ-based ADP service lines, which include nonstaffing services. Total first-quarter revenue at ADP, including all the company's segments, was $2.10 billion, a year-over-year decline of 3.6%. It posted a year-over-year increase in net income of 2.6% to $284.1 million.