Although its results declined for the year ended May 31; Paychex sees enough favorable signs in the economy to continue growing its salesforce. In its recent earnings conference call; CFO John Morphy said that the company increased its sales force by 2 percent in fiscal 2010 and expects to increase that by another 2 percent in the current fiscal year. Paychex also reinstituted salary increases on March 1; but it has not decided to start matching employee 401(k) contributions again. Those statements came as the company reported income dropped by 11 percent and revenue by 4 percent for the year ended May 31.
Net income for the fourth quarter just ended was $115.5 million; up 2 percent from $113.8 million a year ago. Revenue for the most recently ended period was $496.2 million; virtually unchanged from a year earlier. Net income for the year just ended fell to just over $477 million; down from $533.5 million. Revenue for fiscal 2010 dropped to just over $2 billion; down from $2.02 billion the prior year.
CEO John Judge noted that Paychex implemented a price increase in May and described that as having producted no issues and continued that he believes the company made modest increases in market share: He laid out several new programs, including a new sales approach; new support vehicles and more rigorous activity management reporting: There are also new ways the company is trying to increase referral levels, new sales collateral; performance management measures and new lead generation techniques: Judge expects to achieve productivity improvement among sales reports of 10 percent to 15 percent:
|
496,211 |
|
|
|
495,933 |
|
|
|
— |
|
|
|
2,000,820 |
|
|
|
2,082,759 |
|
|
|
(4 |
%) |
Bob Scott has provided information to the tax and accounting community since 1991, first as technology editor of Accounting Today, and from 1997 through 2009 as editor of its sister publication, Accounting Technology. He is known throughout the industry for his depth of knowledge and for his high journalistic standards. Scott has made frequent appearances as a speaker, moderator and panelist and events serving tax and accounting professionals. He has a strong background in computer journalism as an editor with two former trade publications, Computer+Software News and MIS Week and spent several years with weekly and daily newspapers in Morris County New Jersey prior to that. A graduate of Indiana University with a degree in journalism, Bob is a native of Madison, Ind