Automatic Data Processing is lowering earnings forecasts for 2003 due to weak economic conditions impacting employer and brokerage services segments and increased investments in possible growth areas.
The company its lowering its guidance for fiscal 2003 to the range of $1.68 - $1.73 earnings per share compared with $1.75 last year, and warns that revenues will be flat in line with last year's $7 billion.
The company says it will reduce or freeze headcount in underperforming business and will "aggressively exit" non-performing product lines and non-strategic businesses.
Any new investments will be directed towards possible growth markets. The company expects to spend between $150 to $200 million over the next twelve to eighteen months in meeting targets.
The revision is the second to be issued by the company this year. In January, ADP warned investors to expect low single digit increases for 2003 against previous guidance for mid single digit growth.