Butler remained cautious as his organization reported that net income for the most recently ended period rose to $315.8 million, up 5 percent from $300.8 million a year earlier. Revenue for the December quarter was $2.204 billion, up from $2.203 billion in last year's corresponding period. And the improvement in earnings was largely the result of a benefit as savings from expense cutting was offset by a rise in the cost of revenue.
In normal economic times, the company would increase its sales force by 6 percent to 7 percent with the expectation of generating an 8 percent or greater improvement in revenue at the beginning of a fiscal year. Despite the fact that ADP's enterprise business isn't picking up, with the small business up turn, "We think it’s time to turn back to the traditional module," he said. That means hiring both in the telesales and outsides sales force in order to have the employees up to speed before fiscal 2011 begins on July 1.
For the recently ended quarter, Employer Services revenue dropped by 2 percent for the quarter, while payroll and payroll tax filling revenue were off by 7 percent and the number of employees on clients' payrolls dropped by 5 percent. Dealer Services, which derives revenue from the automobile industry, also saw some improvement, although that business remains in difficult circumstances.
With the improvement in U.S. auto sales, Butler said, "We’re not calling it a trend, but it feels a heck of a lot better than the declines of the last couple of years."