Paychex, Inc. · NASDAQ:PAYX
Paychex — Q3 2021 Earnings Presentation
19 slides from Paychex's earnings presentation, Apr 6, 2021
Slide 1: Third Quarter Highlights and Financial Results Fiscal 2021
Third Quarter Highlights and Financial Results Fiscal 2021
Slide 2: Forward Looking Statements
Forward Looking Statements You should be aware that certain written and oral statements made by management may constitute “forward-looking statements” within the meaning of the safe-harbor provisions of the United States (“U.S.”) Private Securities Litigation Reform Act of 1995. Forward-looking stat
Slide 3: Paychex Overview
Paychex Overview • Integrated, cloud-based HCM platform A leading provider of integrated • Leading-edge technology human capital management solutions coupled with flexible (“HCM”) solutions for human service options resources (“HR”), payroll, benefits, and insurance solutions for small- • Leader in
Slide 4: Third Quarter Highlights
Third Quarter Highlights 4
Slide 5: Third Quarter Financial Highlights
Third Quarter Financial Highlights Service Revenues Adjusted Operating Income(1) Adjusted Diluted EPS(1) 2% 0% 1% $470M $469M $0.97 $1,122M $0.96 $1,097M Q3 FY20 Q3 FY21 Q3 FY20 Q3 FY21 Q3 FY20 Q3 FY21 (1) Adjusted Operating Income and Adjusted Diluted Earnings per Share (“EPS”) are not U.S. general
Slide 6: Third Quarter Service Revenue
Third Quarter Service Revenue (In Millions) Key Drivers Management Solutions $1,122 • Continued strong retention and client $1,097 base growth $1,047 • Higher revenue per check • Lower employee counts throughout our HCM suite due to COVID-19 which also impacted annual year-end revenues +6% $850 0% $
Slide 7: Third Quarter Business Highlights
Third Quarter Business Highlights • Positioned for growth with progress in key business metrics o Achieved record client retention and client satisfaction scores which drove increase in client base o Continued to see strong demand for HR outsourcing, particularly the ASO model o Experienced strength
Slide 8: Recent Product & Technology Launches
Recent Product & Technology Launches Designed to simplify common HR and payroll challenges Pooled Employer Plan (PEP) In response to the SECURE Act, pooled employer plans reduce fiduciary liability for employers, simplify retirement plan management, and reduce plan expenses when compared to single-e
Slide 9: Product & Technology Horizon
Product & Technology Horizon Innovation to meet our customers’ evolving business needs Artificial Intelligence Data Analytics Expanded (including Paychex Flex Integrations (APIs) Intelligence Engine) Wearable Voice Personalization Solutions Recognition 9
Slide 10: Recent Awards and Recognition
Recent Awards and Recognition Paychex is being honored for its innovative technology and corporate culture Training Magazine Ethisphere World’s Top 100 Training Companies World’s Most Ethical Companies #7 on the list of top training organizations in Paychex recognized for the 13th time, and the the
Slide 11: Sustained Financial Performance
Sustained Financial Performance (In Millions, Except Per Share Amounts) Total Service Revenue Adjusted Diluted EPS(1) $3.00 $2.84 $3,954 $3.00 $3,692 $2.55 $2.84 $3,314 $991 $2.23 $2.55 $3,102 $814 $2,906 $556 $2.03 $2.23 $422 $2.03 $379 $2,758 $2,878 $2,963 $2,527 $2,680 FY16 FY17(2) FY18(2) FY19 F
Slide 12: Balance Sheets and Cash Flows
Balance Sheets and Cash Flows February 28, 2021 May 31, 2020 ($ in Millions) Cash, Restricted Cash, & Total Corporate Investments $ 1,080.9 $ 1,013.7 • Strong liquidity position with no Total Debt, Net of Debt Issuance Costs (1) $ 804.2 $ 801.9 net debt Return on Equity 37% 41% • $800M of private pl
Slide 13: Fiscal 2021 Outlook
Fiscal 2021 Outlook
Slide 14: Fiscal Year 2021 Outlook
Fiscal Year 2021 Outlook(1) Previous Guidance Revised Guidance Year-over-Year Growth Year-over-Year Growth Management Solutions Revenue (1%) - 1% 0% - 2% PEO & Insurance Solutions Revenue (5%) - (2%) (5%) - (2%) Total Service Revenue n/a (1%) - 1% Total Revenue (3%) - 0% (2%) - 0% Adjusted Diluted E
Slide 15: Financial Results
Financial Results 15
Slide 16: Financial Results
Financial Results For the Three and Nine Months ended February 28, 2021 Three Months Ended % Nine Months Ended % (In millions, except per share amounts) February 28, 2021 Change February 28, 2021 Change Management Solutions $ 846.8 (0%) $ 2,267.0 (1%) PEO and Insurance Solutions 249.8 (8%) 715.8 (6%
Slide 17: Non-GAAP Financial Measures
Non-GAAP Financial Measures For the Three and Nine Months ended February 28, 2021 and February 29, 2020 (In millions, except per share amounts) Three Months Ended Nine Months Ended February 28, February 29, % February 28, February 29, % 2021(1) 2020 Change 2021(1) 2020 Change Operating Income $ 468.
Slide 18: Investment Portfolio Results
Investment Portfolio Results Three Months Ended Nine Months Ended February 28, February 29, % February 28, February 29, % ($ in millions) 2021 2020 Change 2021 2020 Change Average Investment Balances: Funds Held For Clients $ 4,459.6 $ 4,454.3 0% $ 3,849.5 $ 3,975.0 (3%) Corporate Cash Equivalents a
Slide 19: Paychex: The Power of Simplicity
PAYCHEX HR | Payroll | Benefits | Insurance The Power of Simplicity 19