Paychex 2012 Annual Report Download - page 5

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3
2012 Annual Report
As I look back on 2012, I see the strength of
our company reflected in our solid financial
performance, our new leadership team, our
dedicated employees, and our steadfast focus on
continued improvement. The strides we made
during the past year position Paychex to provide
our shareholders with further revenue and profit
growth in the future.
YEAR IN REVIEW
Our results in 2012 are reflected in some of the
key metrics for our business. One of the most
important is checks per payroll, which is our
estimate of the average number of checks issued
in each payroll run we do for our clients. At the
end of the fiscal year, checks per payroll had
improved for nine consecutive quarters – a steady
increase that began at the end of fiscal 2010.
And, while we still see a challenging environment
for the formation of new businesses, our clients
already in business are staying the course in
greater numbers, and they’re counting on us
like never before. We saw this in 2012, with
near-record client retention and best-ever
client satisfaction levels. Client satisfaction is
a particularly important measurement for us,
because as payroll and human resource rules and
regulations get more complicated, businesses
turn to Paychex to help them navigate those
complexities. We ended the year with 567,000
clients, up slightly from the previous year. This
breaks a trend from 2009 and 2010, when we
experienced declines in our client base.
FINANCIAL RESULTS
Our return to growth can be seen in our
financial results for the year ended May 31, 2012.
By generating a 7% increase in total revenue
over the year before, we achieved a record level
of service revenue at $2.2 billion. Payroll service
revenue rose 5% to $1.5 billion for the same
period. Our commitment to leveraging expenses
helped push operating income, net of certain
items, up 10% to $810.3 million. Net earnings
and earnings per share increased 6%, to
$548.0 million and $1.51 per share, respectively.
And, we returned 84%, or $460.5 million, of
net income to our shareholders. Cash flow from
operations remains strong at $706.6 million for
fiscal 2012. Continued on page 5