Paychex, Inc. reported its financial results for the three months ended August 31, 2024, showcasing a solid performance with total revenue reaching $1,318.5 million, a 3% increase from $1,286.0 million in the same period of 2023. Total service revenue also rose to $1,281.0 million, up from $1,253.3 million year-over-year. The company's operating income increased to $546.7 million, compared to $536.3 million in the prior year.
Net income for the quarter was $427.4 million, slightly higher than $419.2 million reported in the previous year. Diluted earnings per share improved to $1.18 from $1.16, reflecting the company's effective management of expenses, which rose to $771.8 million from $749.7 million. The increase in expenses was attributed to higher costs in PEO direct insurance and investments in technology, sales, and marketing.
Paychex's comprehensive income for the quarter was $492.2 million, significantly up from $396.0 million in the prior year. The company declared cash dividends of $352.8 million, or $0.98 per share, compared to $321.4 million, or $0.89 per share, in the same quarter last year.
As of August 31, 2024, total assets increased to $10,489.1 million from $10,383.1 million at the end of the previous fiscal period. Current assets also rose to $7,361.4 million, with accounts receivable net of allowance for credit losses increasing to $1,126.2 million. Funds held for clients grew to $3,763.2 million, up from $3,706.2 million.
The company completed the acquisition of Alterna Capital Solutions LLC on July 31, 2023, for a total consideration of $95.1 million, which included the settlement of $128.9 million in debt. This acquisition is expected to enhance Paychex's service offerings and client base.
In terms of cash flow, net cash provided by operating activities was $546.1 million, down from $693.0 million in the prior year, while net cash used in investing activities increased to $(110.0) million from $(13.2) million. The company reported a net change in cash, restricted cash, and equivalents of $(48.9) million, contrasting sharply with a positive change of $1,749.2 million in the same quarter last year.
Overall, Paychex continues to focus on strategic growth through acquisitions and investments in technology, while maintaining strong financial health and shareholder returns.
About PAYCHEX INC
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