Automatic Data Processing Inc. (NASDAQ:ADP) Q2 2022 Earnings Conference Call January 26, 2022 8:30 AM ET Company Participants Carlos Rodriguez - Chief Executive Officer Maria Black - President Don McGuire - Corporate Vice President, Chief Financial Officer Danyal Hussain - Vice President, Investor Relations Conference Call Participants Bryan Keane - Deutsche Bank David Togut - Evercore ISI Kevin McVeigh - Credit Suisse Tien-tsin Huang - JP Morgan Samad Samana - Jefferies Bryan Bergin - Cowen Ramsey El-Assa ...

Summary of Automatic Data Processing (ADP) Nasdaq 45th Investor Conference Company Overview - **Company**: Automatic Data Processing (ADP) - **Event**: Nasdaq 45th Investor Conference - **Date**: November 30, 2021 - **Participants**: Don Mcguire (CFO), James Faucette (Morgan Stanley Analyst) Key Industry Insights - **Labor Market Trends**: The ongoing "great resignation" is leading to significant employee turnover across various sectors, with many individuals reassessing their career choices and job satisfaction [5][9] - **Employment Recovery**: Employment levels have shown recovery post-pandemic, with small businesses returning to approximately 2% below pre-pandemic levels, mid-market at about 4%, and upper-market at around 6% below [6][10] - **Sector-Specific Challenges**: Certain sectors, particularly hospitality, are experiencing labor shortages despite overall recovery, indicating a potential mismatch in job availability and worker preferences [8][9] Company Performance and Strategy - **Retention Rates**: ADP has seen improved retention rates attributed to enhanced product offerings and customer service, with a focus on Net Promoter Scores (NPS) driving these improvements [16][17] - **Market Opportunity**: The market for ADP's services is estimated at $150 billion, with significant opportunities to capture market share from companies using legacy systems [19][20] - **Product Migration**: ADP is transitioning to new platforms, which has improved margins and operational efficiency, although challenges remain in client migration and satisfaction [22][24] Financial Performance - **Margin Improvement**: ADP anticipates margin improvements driven by revenue growth and digital transformation initiatives, with operating leverage playing a significant role [37][38] - **Capital Allocation**: Over the past decade, ADP has returned approximately $24 billion to shareholders through buybacks and dividends, with a disciplined approach to M&A focusing on smaller, strategic acquisitions [43][44] Consumer Data Opportunities - **Data Utilization**: ADP has access to extensive consumer data, which can be leveraged for HR analytics, employment verification, and market insights, providing value to employers and other stakeholders [32][34] Challenges and Future Outlook - **Labor Market Constraints**: ADP is not immune to labor market challenges but has successfully increased its workforce to support growth [46][47] - **Technology Acquisition**: The company is cautious about acquiring technology solely for talent acquisition, focusing instead on ensuring that any technology brought in is modern and adds value [49] Conclusion - ADP is navigating a complex labor market while focusing on improving retention, capturing market share, and enhancing product offerings. The company is well-positioned for future growth, leveraging its extensive data capabilities and strategic capital allocation.

Automatic Data Processing, Inc. (NASDAQ:ADP) Q1 2022 Earnings Conference Call October 27, 2021 8:30 AM ET Company Participants Carlos Rodriguez – CEO Don Mcguire – CFO Danyal Hussain – Vice President Conference Call Participants Samad Samana – Jefferies Jason Kupferberg – Bank of America Tien Jian Huang – JP Morgan Kevin McVeigh – Credit Suisse Ramsey El Assal – Barclays Kartik Mehta – Northcoast Research James Faucette – Morgan Stanley Bryan Bergin – Cowen Eugene Simuni – Moffett Nathanson Mark Marcon – Ba ...

Legal and Compliance Risks - The company faces various legal and compliance risks that could materially affect its reputation and financial condition due to potential non-compliance with U.S. and foreign laws and regulations [84]. - Changes in laws or regulations may adversely impact the company's revenues and earnings, particularly in relation to tax laws and health care compliance solutions [85]. - The company is subject to scrutiny regarding anti-corruption and anti-money laundering laws, which could lead to significant penalties and affect its business operations [86]. - Compliance with privacy and data protection laws, such as GDPR and CCPA, may result in substantial costs and require amendments to business practices [92]. - The company has implemented Binding Corporate Rules to ensure compliance with EU data protection laws, allowing for cross-border data processing [90]. - The company has implemented policies to monitor compliance with anti-corruption, economic and trade sanctions, and anti-money laundering laws, but there is no assurance that these measures will be adequate or effective [89]. - Regulatory scrutiny has increased, leading to potential civil and criminal penalties, which could adversely affect the company's financial condition and operations [89]. - The company is subject to various privacy, data protection, and cybersecurity laws, including the GDPR and CCPA, which may impose significant compliance costs [92]. - The company has invested in data protection compliance programs, including Binding Corporate Rules (BCRs) to facilitate cross-border data processing [90]. - Increased regulatory requirements may lead to limitations on business activities and could decrease revenues and earnings [89]. - The company has registered its payroll card business and ADP Trust Bank with relevant regulatory bodies to comply with financial regulations [88]. Cybersecurity and Data Protection - Cybersecurity threats are increasing in complexity, and the company invests significant resources to safeguard personal and business information [99]. - Any successful cyberattack could lead to the loss or misuse of confidential information, adversely affecting the company's operations and client trust [102]. - Regulatory investigations related to data security incidents are on the rise, which could lead to increased costs and restrictions on business operations [92]. - The company is focused on enhancing its information security measures to address evolving cyber threats and protect client data [101]. - The company maintains a robust information security program, but data or cyber security incidents could materially adversely affect its business and financial condition [103]. - Cybersecurity incidents could result in significant financial losses, regulatory investigations, and damage to the company's reputation [103]. - The company relies heavily on its data processing systems, and any disruptions could lead to financial loss and regulatory intervention [103]. - The company utilizes third-party data centers and cloud services, and disruptions in these services could materially affect operations and financial results [104]. Financial and Operational Risks - The company is investing significantly in product development, but the return on investment cycle is long and uncertain [107]. - Transformation initiatives aimed at streamlining operations may not yield expected benefits, potentially impacting financial goals and competitive position [108]. - Major natural disasters or catastrophic events could adversely affect the company's financial condition and results of operations [109]. - The COVID-19 outbreak has negatively impacted revenue and new business bookings due to client behavior changes and operational disruptions [110]. - The company is exposed to market risks from changes in foreign currency exchange rates, which could impact financial results [114]. - The company maintains access to various sources of liquidity to satisfy short-term funding requirements, which may be impacted during financial market disruptions [113]. - The company relies on large banks for electronic payments, and a systemic banking shutdown could impede its ability to process funds [114]. - The company faces intense competition for skilled employees, and failure to attract and retain talent could negatively impact operations and culture [117]. - The company has strong investment-grade credit ratings, and failure to maintain these could increase borrowing costs and impact operations [115]. - The company’s operations may be adversely affected by political, economic, and social factors, including trade and monetary policies [110]. Infrastructure and Facilities - The company’s facilities are adequate for their intended purposes, with owned properties totaling approximately 3,070,644 square feet and leased properties totaling approximately 5,366,245 square feet [119].

Automatic Data Processing, Inc. (NASDAQ:ADP) Q4 2021 Earnings Conference Call July 28, 2021 8:30 AM ET Company Participants Danyal Hussain - Vice President, Investor Relations Carlos Rodriguez - President and CEO Kathleen Winters - Chief Financial Officer Conference Call Participants Eugene Simuni - MoffettNathanson Pete Christiansen - Citi James Faucette - Morgan Stanley Dan Dolev - Mizuho Ramsey El-Assal - Barclays Bryan Bergin - Cowen Kartik Mehta - Northcoast Research Mark Marcon - Baird Operator Good m ...