PAYX 8-K
Paychex Inc (PAYX)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): |
(Exact name of registrant as specified in its charter)
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Registrant’s Telephone Number, Including Area Code: |
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
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Trading |
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition
On June 25, 2025, Paychex, Inc. (the "Company") issued a press release (the "Press Release") reporting its financial results for the three and twelve months ended May 31, 2025. A copy of the Press Release is attached as Exhibit 99.1 to this Current Report on Form 8-K.
The information provided pursuant to this Item 2.02, including Exhibit 99.1, is being "furnished" herewith and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under such section, nor shall the information be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent specifically provided in such a filing.
Item 9.01 Financial Statements and Exhibits
(d.)
Exhibit No. |
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Description |
99.1 |
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104 |
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Cover Page Interactive File, embedded in Inline XBRL. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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PAYCHEX, INC. |
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Date: |
June 25, 2025 |
By: |
/s/ Robert L. Schrader |
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Robert L. Schrader |
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Senior Vice President and Chief Financial Officer |
PRESS RELEASE OF PAYCHEX, INC. DATED JUNE 25, 2025
Paychex, Inc. Reports Fourth Quarter and Full Year 2025 Results
Rochester, N.Y. (June 25, 2025) - Paychex, Inc. (Nasdaq: PAYX) (the "Company," "Paychex," "we," "our," or "us") today reported results for the fiscal quarter ended May 31, 2025 (the "fourth quarter") and fiscal year ended May 31, 2025 ("fiscal 2025"). Results compared with the same period last year are as follows:
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Fourth Quarter |
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Fiscal Year |
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In millions, except per share amounts |
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2025 |
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2024 |
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Change(2) |
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2025 |
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2024 |
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Change(2) |
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Total revenue |
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$ |
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1,427.3 |
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$ |
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1,295.1 |
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10 |
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% |
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$ |
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5,571.7 |
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$ |
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5,278.3 |
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6 |
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% |
Operating income |
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$ |
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431.1 |
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$ |
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481.8 |
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(11 |
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% |
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$ |
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2,207.7 |
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$ |
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2,174.1 |
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2 |
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% |
Adjusted operating income(1) |
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$ |
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576.7 |
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$ |
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521.3 |
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11 |
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% |
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$ |
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2,370.0 |
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$ |
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2,213.6 |
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7 |
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% |
Operating margin |
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30.2 |
% |
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37.2 |
% |
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39.6 |
% |
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41.2 |
% |
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Adjusted operating margin(1) |
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40.4 |
% |
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40.2 |
% |
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42.5 |
% |
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41.9 |
% |
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Diluted earnings per share |
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$ |
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0.82 |
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$ |
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1.05 |
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(22 |
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% |
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$ |
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4.58 |
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$ |
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4.67 |
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(2 |
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% |
Adjusted diluted earnings per share(1) |
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$ |
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1.19 |
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$ |
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1.12 |
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6 |
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% |
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$ |
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4.98 |
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$ |
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4.72 |
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6 |
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% |
“Paychex demonstrated solid performance this year against our strategic objectives, underscoring our ability to effectively navigate dynamic market conditions while continuing to enhance our customer experience and market position, and maintaining our industry-leading operating margins,” stated John Gibson, President and Chief Executive Officer. “We delivered 10% revenue growth in the fourth quarter, reflecting continued execution across the business and the addition of Paycor. Our strong client retention this year is a testament to the value we deliver as a trusted partner in our customers' growth and success, particularly during challenging and uncertain times. The strategic investments we continued to make in AI, technology and our customer experience played a significant role in our growth in revenue and profitability, contributing to strong adjusted operating margin expansion this year despite margin headwinds from Paycor and the discontinued Employee Retention Tax Credit (“ERTC”) program.”
Gibson added, “With the successful completion of the Paycor acquisition and significant progress made on the integration, Paychex is better positioned than ever before for continued success in the digital and AI-driven era of human capital management ("HCM"). This strategic move strengthens our capabilities upmarket; expands our total addressable market; enhances our strategic partner network; and provides additional opportunity for cross sell across our client base. The anticipated cost and revenue synergies, coupled with our commitment to innovation and customer-centric solutions, we believe will position us to continue our long-standing commitment to deliver robust returns and create long-term shareholder value.”
1
Fourth Quarter Business Highlights
Total revenue increased to $1.4 billion for the fourth quarter, representing growth of 10% over the prior year period. Highlights as compared with the corresponding prior year period are as follows:
Management Solutions revenue increased 12% to $1.0 billion for the fourth quarter, primarily due to the following:
Excluding the acquisition of Paycor, Management Solutions revenue increased approximately 3% compared with the corresponding prior year period.
Professional Employer Organization ("PEO") and Insurance Solutions revenue increased 4% to $340.3 million for the fourth quarter, primarily due to the following:
Interest on funds held for clients increased 18% to $45.2 million for the fourth quarter, primarily due to the acquisition of Paycor. Excluding the acquisition of Paycor, interest on funds held for clients increased approximately 3% compared with the corresponding year period.
Total expenses increased 22% to $1.0 billion for the fourth quarter, primarily impacted by the following factors:
Excluding the acquisition of Paycor and the prior year period cost optimization initiatives noted above, total expenses increased 1% for the fourth quarter compared to the prior year period.
Operating income decreased 11% to $431.1 million for the fourth quarter. Operating margin (operating income as a percentage of total revenue) was 30.2% for the fourth quarter compared to 37.2% for the prior year period. Adjusted operating income(1) grew 11% to $576.7 million for the fourth quarter. Adjusted operating margin(1) (adjusted operating income as a percentage of total revenue) was 40.4% for the fourth quarter compared to 40.2% for the prior year period. Excluding Paycor, adjusted operating margin(1) expanded by approximately 110 basis points compared to the prior year period.
Interest expense increased $54.2 million to $63.7 million for the fourth quarter, primarily due to the issuance of incremental debt to finance the acquisition of Paycor and acquisition-related costs.
Our effective income tax rate was 23.7% for the fourth quarter and 22.8% for the prior year period. Both periods were affected by the recognition of discrete tax impacts related to employee stock-based compensation payments.
Diluted earnings per share decreased 22% to $0.82 per share and adjusted diluted earnings per share(1) increased 6% to $1.19 per share for the fourth quarter.
2
Fiscal Year Business Highlights
Highlights for fiscal 2025 as compared with the corresponding prior year are as follows:
Financial Position and Liquidity
Our financial position and cash flow generation remained strong during fiscal 2025. As of May 31, 2025, we had:
Return to Stockholders During Fiscal 2025
3
Non-GAAP Financial Measures
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For the three months ended |
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For the twelve months ended |
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May 31, |
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May 31, |
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$ in millions, except per share amounts |
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2025 |
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2024 |
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Change |
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2025 |
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2024 |
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Change |
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Operating income |
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$ |
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431.1 |
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$ |
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481.8 |
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(11 |
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% |
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$ |
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2,207.7 |
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$ |
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2,174.1 |
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2 |
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% |
Non-GAAP adjustments: |
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Acquisition-related costs(1) |
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145.6 |
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— |
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162.3 |
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— |
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Cost optimization initiatives(2) |
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— |
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39.5 |
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— |
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39.5 |
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Adjusted operating income |
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$ |
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576.7 |
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$ |
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521.3 |
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11 |
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% |
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$ |
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2,370.0 |
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$ |
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2,213.6 |
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7 |
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% |
Adjusted operating margin |
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40.4 |
% |
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40.2 |
% |
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42.5 |
% |
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41.9 |
% |
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Net income |
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$ |
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297.2 |
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$ |
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379.9 |
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(22 |
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% |
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$ |
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1,657.3 |
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$ |
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1,690.4 |
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(2 |
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% |
Non-GAAP adjustments: |
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Acquisition-related costs(1) |
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166.4 |
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— |
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196.3 |
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— |
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Cost optimization initiatives(2) |
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— |
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39.5 |
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— |
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39.5 |
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Tax impact of above adjustments |
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(33.3 |
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(9.6 |
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(40.6 |
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(9.6 |
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Excess tax benefit related to employee stock-based compensation payments(3) |
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(0.7 |
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(5.7 |
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(10.1 |
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(11.2 |
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Adjusted net income |
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$ |
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429.6 |
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$ |
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404.1 |
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6 |
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% |
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$ |
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1,802.9 |
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$ |
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1,709.1 |
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5 |
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% |
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Diluted earnings per share(4) |
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$ |
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0.82 |
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$ |
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1.05 |
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(22 |
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% |
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$ |
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4.58 |
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$ |
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4.67 |
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(2 |
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% |
Non-GAAP adjustments: |
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Acquisition-related costs(1) |
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0.46 |
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— |
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0.54 |
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— |
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Cost optimization initiatives(2) |
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— |
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0.11 |
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— |
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0.11 |
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Tax impact of above adjustments |
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(0.09 |
) |
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(0.03 |
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(0.11 |
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(0.03 |
) |
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Excess tax benefit related to employee stock-based compensation payments(3) |
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(0.00 |
) |
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(0.02 |
) |
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(0.03 |
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(0.03 |
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Adjusted diluted earnings per share |
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$ |
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1.19 |
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$ |
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1.12 |
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6 |
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% |
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$ |
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4.98 |
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$ |
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4.72 |
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6 |
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% |
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Net income |
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$ |
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297.2 |
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$ |
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379.9 |
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(22 |
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% |
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$ |
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1,657.3 |
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$ |
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1,690.4 |
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(2 |
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% |
Non-GAAP adjustments: |
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Interest expense/(income), net |
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43.2 |
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(12.1 |
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32.6 |
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(45.4 |
) |
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Income taxes |
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92.1 |
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111.9 |
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518.6 |
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527.6 |
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Depreciation and amortization expense |
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85.7 |
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45.6 |
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209.5 |
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176.5 |
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EBITDA |
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$ |
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518.2 |
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$ |
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525.3 |
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(1 |
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% |
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$ |
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2,418.0 |
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$ |
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2,349.1 |
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3 |
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% |
Non-GAAP adjustments: |
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Acquisition-related costs(1) |
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104.9 |
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— |
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121.6 |
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— |
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Cost optimization initiatives(2) |
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— |
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39.5 |
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— |
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39.5 |
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Adjusted EBITDA |
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$ |
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623.1 |
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$ |
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564.8 |
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10 |
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% |
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$ |
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2,539.6 |
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$ |
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2,388.6 |
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6 |
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% |
4
In addition to reporting operating income, operating margin, net income, and diluted earnings per share, which are U.S. GAAP measures, we present adjusted operating income, adjusted operating margin, adjusted net income, adjusted diluted earnings per share, earnings before interest, taxes, depreciation, and amortization ("EBITDA"), and adjusted EBITDA, which are non-GAAP measures. We believe these additional measures are indicators of the performance of our core business operations period over period. Adjusted operating income, adjusted operating margin, adjusted net income, adjusted diluted earnings per share, EBITDA, and adjusted EBITDA are not calculated through the application of U.S. GAAP and are not required forms of disclosure by the Securities and Exchange Commission ("SEC"). As such, they should not be considered a substitute for the U.S. GAAP measures of operating income, operating margin, net income, and diluted earnings per share, and, therefore, they should not be used in isolation but in conjunction with the U.S. GAAP measures. The use of any non-GAAP measure may produce results that vary from the U.S. GAAP measure and may not be comparable to a similarly defined non-GAAP measure used by other companies.
Business Outlook
Our business outlook for the fiscal year ending May 31, 2026 ("fiscal 2026") incorporates current assumptions and market conditions and excludes acquisition-related costs. Changes in the macroeconomic environment could alter our guidance. With consideration of these impacts, we have updated our business outlook as follows:
(1) Adjusted operating margin and adjusted diluted earnings per share are not U.S. GAAP measures. Please refer to the "Non-GAAP Financial Measures" section on page 4 of this press release for a discussion of non-GAAP measures.
Annual Report on Form 10-K ("Form 10-K")
We anticipate filing our Form 10-K before the end of July 2025, and it will be available at https://investor.paychex.com. This press release should be read in conjunction with the Form 10-K and the related Notes to Consolidated Financial Statements and Management's Discussion and Analysis of Financial Condition and Results of Operations contained in that Form 10-K.
Webcast Details
Interested parties may access the webcast of our Earnings Release Conference Call, scheduled for June 25, 2025, at 9:30 a.m. Eastern Time, at https://investor.paychex.com. The webcast will be archived for approximately 90 days. Our news releases, current financial information, SEC filings, and investor presentations are also accessible at https://investor.paychex.com.
Contacts
Investor Relations: |
Media Relations: |
Rachel White |
Tracy Volkmann |
Head of Investor Relations |
Manager, Public Relations |
(513) 954-7388 |
(585) 387-6705 |
5
About Paychex
Paychex, Inc. (Nasdaq: PAYX) is the digitally driven HR leader that is reimagining how companies address the needs of today's workforce with the most comprehensive, flexible, and innovative HCM solutions for organizations of all sizes. Offering a full spectrum of HR advisory and employee solutions, Paychex pays one out of every 11 American private sector workers and is raising the bar in HCM for nearly 800,000 customers in the U.S. and Europe. Every member of the Paychex team is committed to fulfilling the Company's purpose of helping businesses succeed. Visit www.paychex.com to learn more.
Cautionary Note Regarding Forward-Looking Statements
Certain written statements in this press release may contain, and members of management may from time to time make or discuss statements which constitute, "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by such words and phrases as "expect," "outlook," "will," guidance," "projections," "strategy," "anticipate," "believe," "can," "could," "may," "possible," "potential" "should," and other similar words or phrases. Forward-looking statements include, without limitation, all matters that are not historical facts. Examples of forward-looking statements include, among others, statements we make regarding the integration of Paycor, operating performance, events, or developments that we expect or anticipate will occur in the future, including statements relating to our outlook, revenue growth, earnings, earnings-per-share growth, and similar projections.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations, and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy, and other future conditions. Because forward-looking statements relate to the future, they are subject to known and unknown uncertainties, risks, changes in circumstances, and other factors that are difficult to predict, many of which are outside our control. Our actual performance and outcomes, including without limitation, our actual results and financial condition, may differ materially from those indicated in or suggested by the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following:
6
Any of these factors, as well as such other factors as discussed in our SEC filings, could cause our actual results to differ materially from our anticipated results. The information provided in this document is based upon the facts and circumstances known as of the date of this press release, and any forward-looking statements made by us in this document speak only as of the date on which they are made. Except as required by law, we undertake no obligation to update these forward-looking statements after the date of issuance of this press release to reflect events or circumstances after such date, or to reflect the occurrence of unanticipated events.
7
PAYCHEX, INC.
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(In millions, except per share amounts)
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For the three months ended |
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For the twelve months ended |
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May 31, |
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May 31, |
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2025 |
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2024 |
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Change(2) |
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2025 |
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2024 |
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Change(2) |
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Revenue: |
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|
|
|
|
|
|
|
|
||||||
Management Solutions |
|
$ |
|
1,041.8 |
|
|
$ |
|
930.3 |
|
|
|
12 |
|
% |
|
$ |
|
4,067.1 |
|
|
$ |
|
3,866.4 |
|
|
|
5 |
|
% |
PEO and Insurance Solutions |
|
|
|
340.3 |
|
|
|
|
326.6 |
|
|
|
4 |
|
% |
|
|
|
1,342.9 |
|
|
|
|
1,265.6 |
|
|
|
6 |
|
% |
Total service revenue |
|
|
|
1,382.1 |
|
|
|
|
1,256.9 |
|
|
|
10 |
|
% |
|
|
|
5,410.0 |
|
|
|
|
5,132.0 |
|
|
|
5 |
|
% |
Interest on funds held for clients(1) |
|
|
|
45.2 |
|
|
|
|
38.2 |
|
|
|
18 |
|
% |
|
|
|
161.7 |
|
|
|
|
146.3 |
|
|
|
10 |
|
% |
Total revenue |
|
|
|
1,427.3 |
|
|
|
|
1,295.1 |
|
|
|
10 |
|
% |
|
|
|
5,571.7 |
|
|
|
|
5,278.3 |
|
|
|
6 |
|
% |
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of service revenue |
|
|
|
393.9 |
|
|
|
|
375.2 |
|
|
|
5 |
|
% |
|
|
|
1,540.4 |
|
|
|
|
1,479.3 |
|
|
|
4 |
|
% |
Selling, general and administrative expenses |
|
|
|
602.3 |
|
|
|
|
438.1 |
|
|
|
37 |
|
% |
|
|
|
1,823.6 |
|
|
|
|
1,624.9 |
|
|
|
12 |
|
% |
Total expenses |
|
|
|
996.2 |
|
|
|
|
813.3 |
|
|
|
22 |
|
% |
|
|
|
3,364.0 |
|
|
|
|
3,104.2 |
|
|
|
8 |
|
% |
Operating income |
|
|
|
431.1 |
|
|
|
|
481.8 |
|
|
|
(11 |
) |
% |
|
|
|
2,207.7 |
|
|
|
|
2,174.1 |
|
|
|
2 |
|
% |
Interest expense |
|
|
|
(63.7 |
) |
|
|
|
(9.5 |
) |
|
n/m |
|
|
|
|
|
(105.4 |
) |
|
|
|
(37.3 |
) |
|
n/m |
|
|
||
Other income, net(1) |
|
|
|
21.9 |
|
|
|
|
19.5 |
|
|
|
12 |
|
% |
|
|
|
73.6 |
|
|
|
|
81.2 |
|
|
|
(9 |
) |
% |
Income before income taxes |
|
|
|
389.3 |
|
|
|
|
491.8 |
|
|
|
(21 |
) |
% |
|
|
|
2,175.9 |
|
|
|
|
2,218.0 |
|
|
|
(2 |
) |
% |
Income taxes |
|
|
|
92.1 |
|
|
|
|
111.9 |
|
|
|
(18 |
) |
% |
|
|
|
518.6 |
|
|
|
|
527.6 |
|
|
|
(2 |
) |
% |
Net income |
|
$ |
|
297.2 |
|
|
$ |
|
379.9 |
|
|
|
(22 |
) |
% |
|
$ |
|
1,657.3 |
|
|
$ |
|
1,690.4 |
|
|
|
(2 |
) |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Basic earnings per share |
|
$ |
|
0.82 |
|
|
$ |
|
1.06 |
|
|
|
(23 |
) |
% |
|
$ |
|
4.60 |
|
|
$ |
|
4.69 |
|
|
|
(2 |
) |
% |
Diluted earnings per share |
|
$ |
|
0.82 |
|
|
$ |
|
1.05 |
|
|
|
(22 |
) |
% |
|
$ |
|
4.58 |
|
|
$ |
|
4.67 |
|
|
|
(2 |
) |
% |
Weighted-average common shares outstanding |
|
|
|
360.3 |
|
|
|
|
360.0 |
|
|
|
|
|
|
|
|
360.2 |
|
|
|
|
360.3 |
|
|
|
|
|
||
Weighted-average common shares outstanding, assuming dilution |
|
|
|
362.3 |
|
|
|
|
361.8 |
|
|
|
|
|
|
|
|
362.0 |
|
|
|
|
362.1 |
|
|
|
|
|
||
Cash dividends per common share |
|
$ |
|
1.08 |
|
|
$ |
|
0.98 |
|
|
|
|
|
|
$ |
|
4.02 |
|
|
$ |
|
3.65 |
|
|
|
|
|
||
n/m – not meaningful
n/m – not meaningful
8
PAYCHEX, INC.
CONSOLIDATED BALANCE SHEETS (Unaudited)
(In millions, except per share amounts)
|
|
May 31, |
|
|||||||
|
|
2025 |
|
|
2024 |
|
||||
ASSETS |
|
|
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
1,628.6 |
|
|
$ |
|
1,468.9 |
|
Restricted cash |
|
|
|
47.9 |
|
|
|
|
47.8 |
|
Corporate investments |
|
|
|
34.5 |
|
|
|
|
33.9 |
|
Interest receivable |
|
|
|
27.9 |
|
|
|
|
23.3 |
|
Accounts receivable, net of allowance for credit losses |
|
|
|
1,330.5 |
|
|
|
|
1,059.6 |
|
PEO unbilled receivables, net of advance collections |
|
|
|
616.6 |
|
|
|
|
542.4 |
|
Prepaid income taxes |
|
|
|
38.9 |
|
|
|
|
47.5 |
|
Prepaid expenses and other current assets |
|
|
|
378.3 |
|
|
|
|
321.9 |
|
Current assets before funds held for clients |
|
|
|
4,103.2 |
|
|
|
|
3,545.3 |
|
Funds held for clients |
|
|
|
4,813.3 |
|
|
|
|
3,706.2 |
|
Total current assets |
|
|
|
8,916.5 |
|
|
|
|
7,251.5 |
|
Long-term corporate investments |
|
|
|
— |
|
|
|
|
3.7 |
|
Property and equipment, net of accumulated depreciation |
|
|
|
511.5 |
|
|
|
|
411.7 |
|
Operating lease right-of-use assets, net of accumulated amortization |
|
|
|
63.8 |
|
|
|
|
46.9 |
|
Intangible assets, net of accumulated amortization |
|
|
|
1,947.3 |
|
|
|
|
194.5 |
|
Goodwill |
|
|
|
4,514.1 |
|
|
|
|
1,882.7 |
|
Long-term deferred costs |
|
|
|
482.4 |
|
|
|
|
477.1 |
|
Other long-term assets |
|
|
|
128.5 |
|
|
|
|
115.0 |
|
Total assets |
|
$ |
|
16,564.1 |
|
|
$ |
|
10,383.1 |
|
|
|
|
|
|
|
|
|
|
||
LIABILITIES |
|
|
|
|
|
|
|
|
||
Accounts payable |
|
$ |
|
129.8 |
|
|
$ |
|
104.3 |
|
Accrued corporate compensation and related items |
|
|
|
183.9 |
|
|
|
|
135.0 |
|
Accrued worksite employee compensation and related items |
|
|
|
735.8 |
|
|
|
|
662.4 |
|
Short-term debt |
|
|
|
18.6 |
|
|
|
|
18.7 |
|
Long-term debt, net, current portion |
|
|
|
399.8 |
|
|
|
|
— |
|
Deferred revenue |
|
|
|
69.4 |
|
|
|
|
50.2 |
|
Other current liabilities |
|
|
|
552.0 |
|
|
|
|
469.8 |
|
Current liabilities before client fund obligations |
|
|
|
2,089.3 |
|
|
|
|
1,440.4 |
|
Client fund obligations |
|
|
|
4,867.0 |
|
|
|
|
3,868.7 |
|
Total current liabilities |
|
|
|
6,956.3 |
|
|
|
|
5,309.1 |
|
Accrued income taxes |
|
|
|
119.0 |
|
|
|
|
102.6 |
|
Deferred income taxes |
|
|
|
444.7 |
|
|
|
|
86.0 |
|
Long-term debt, net |
|
|
|
4,548.4 |
|
|
|
|
798.6 |
|
Operating lease liabilities |
|
|
|
55.5 |
|
|
|
|
49.0 |
|
Other long-term liabilities |
|
|
|
312.2 |
|
|
|
|
236.8 |
|
Total liabilities |
|
|
|
12,436.1 |
|
|
|
|
6,582.1 |
|
|
|
|
|
|
|
|
|
|
||
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
||
Common stock, $0.01 par value; Authorized: 600.0 shares; |
|
|
|
3.6 |
|
|
|
|
3.6 |
|
Additional paid-in capital |
|
|
|
1,901.1 |
|
|
|
|
1,729.5 |
|
Retained earnings |
|
|
|
2,277.0 |
|
|
|
|
2,213.0 |
|
Accumulated other comprehensive loss |
|
|
|
(53.7 |
) |
|
|
|
(145.1 |
) |
Total stockholders’ equity |
|
|
|
4,128.0 |
|
|
|
|
3,801.0 |
|
Total liabilities and stockholders’ equity |
|
$ |
|
16,564.1 |
|
|
$ |
|
10,383.1 |
|
9
PAYCHEX, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In millions)
|
|
For the twelve months ended |
|
|||||||
|
|
May 31, |
|
|||||||
|
|
2025 |
|
|
2024 |
|
||||
OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
||
Net income |
|
$ |
|
1,657.3 |
|
|
$ |
|
1,690.4 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
209.5 |
|
|
|
|
176.5 |
|
Amortization of premiums and discounts on available-for-sale securities, net |
|
|
|
23.4 |
|
|
|
|
(7.0 |
) |
Amortization of deferred contract costs |
|
|
|
236.5 |
|
|
|
|
231.7 |
|
Stock-based compensation costs |
|
|
|
111.8 |
|
|
|
|
61.1 |
|
Benefit from deferred income taxes |
|
|
|
(15.8 |
) |
|
|
|
(29.8 |
) |
Provision for allowance for credit losses |
|
|
|
24.2 |
|
|
|
|
19.8 |
|
Net realized losses on sales of available-for-sale securities |
|
|
|
0.4 |
|
|
|
|
2.6 |
|
Net realized losses on disposal of assets |
|
|
|
3.7 |
|
|
|
|
32.8 |
|
Premiums paid on cash flow hedges |
|
|
|
(19.2 |
) |
|
|
|
— |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
||
Interest receivable |
|
|
|
(3.8 |
) |
|
|
|
1.1 |
|
Accounts receivable and PEO unbilled receivables, net |
|
|
|
(106.1 |
) |
|
|
|
113.0 |
|
Prepaid expenses and other current assets |
|
|
|
(12.0 |
) |
|
|
|
(25.2 |
) |
Accounts payable and other current liabilities |
|
|
|
67.9 |
|
|
|
|
(127.0 |
) |
Deferred costs |
|
|
|
(246.5 |
) |
|
|
|
(244.9 |
) |
Net change in other long-term assets and liabilities |
|
|
|
21.9 |
|
|
|
|
6.1 |
|
Net change in operating lease right-of-use assets and liabilities |
|
|
|
(2.1 |
) |
|
|
|
(3.5 |
) |
Net cash provided by operating activities |
|
|
|
1,951.1 |
|
|
|
|
1,897.7 |
|
INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
||
Purchases of available-for-sale securities |
|
|
|
(14,302.9 |
) |
|
|
|
(6,868.5 |
) |
Proceeds from sales and maturities of available-for-sale securities |
|
|
|
14,292.5 |
|
|
|
|
7,161.2 |
|
Net change in purchased receivables |
|
|
|
(157.3 |
) |
|
|
|
(153.8 |
) |
Purchases of property and equipment |
|
|
|
(191.8 |
) |
|
|
|
(161.4 |
) |
Acquisition of businesses, net of cash acquired |
|
|
|
(3,287.4 |
) |
|
|
|
(208.3 |
) |
Purchases of other assets |
|
|
|
(29.8 |
) |
|
|
|
(30.1 |
) |
Net cash used in investing activities |
|
|
|
(3,676.7 |
) |
|
|
|
(260.9 |
) |
FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
||
Net change in client fund obligations |
|
|
|
(21.0 |
) |
|
|
|
(425.3 |
) |
Net proceeds from short-term borrowings |
|
|
|
— |
|
|
|
|
9.0 |
|
Proceeds from the issuance of corporate bonds |
|
|
|
4,180.9 |
|
|
|
|
— |
|
Dividends paid |
|
|
|
(1,448.5 |
) |
|
|
|
(1,315.3 |
) |
Repurchases of common shares |
|
|
|
(104.5 |
) |
|
|
|
(169.2 |
) |
Debt issuance costs |
|
|
|
(47.8 |
) |
|
|
|
— |
|
Activity related to equity-based plans |
|
|
|
3.8 |
|
|
|
|
26.1 |
|
Net cash provided by/(used in) financing activities |
|
|
|
2,562.9 |
|
|
|
|
(1,874.7 |
) |
Net change in cash, restricted cash, and equivalents |
|
|
|
837.3 |
|
|
|
|
(237.9 |
) |
Cash, restricted cash, and equivalents, beginning of fiscal year |
|
|
|
1,897.0 |
|
|
|
|
2,134.9 |
|
Cash, restricted cash, and equivalents, end of fiscal year |
|
$ |
|
2,734.3 |
|
|
$ |
|
1,897.0 |
|
|
|
|
|
|
|
|
|
|
||
Reconciliation of cash, restricted cash and equivalents |
|
|
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
1,628.6 |
|
|
$ |
|
1,468.9 |
|
Restricted cash |
|
|
|
47.9 |
|
|
|
|
47.8 |
|
Restricted cash and restricted cash equivalents included in funds held for clients |
|
|
|
1,057.8 |
|
|
|
|
380.3 |
|
Total cash, restricted cash, and equivalents |
|
$ |
|
2,734.3 |
|
|
$ |
|
1,897.0 |
|
10