Automatic Data Processing, Inc., also known as ADPยฎ, is a leading global technology company providing human capital management (HCM) solutions. With over 1.1 million clients, ADP is considered a leading provider of HR services such as talent, time management, benefits and payroll.
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended December 31, 2001 Commission File Number 1-5397 ------------------- -------- Automatic Data Processing, Inc. - ----------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 22-1467904 - ----------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) One ADP Boulevard, Roseland, New Jersey 07068 - ----------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's Telephone Number, Including Area Code (973) 974-5000 -------------------------- No change - ----------------------------------------------------------------------------- Former name, former address & former fiscal year, if changed since last report. Indicate by check mark whether the Registrant (1) has filed all annual, quarterly and other reports required to be filed with the commission and (2) has been subject to the filing requirements for at least the past 90 days. X Yes No - ---------------------------------- ---------------------------- As of December 31, 2001 there were 620,271,986 common shares outstanding.
Form 10Q PART I. FINANCIAL INFORMATION CONSOLIDATED STATEMENTS OF EARNINGS ----------------------------------- (In thousands, except per share amounts) (Unaudited) Three Months Ended Six Months Ended December 31, December 31, --------------------- ---------------------- 2001 2000 2001 2000 ---- ---- ---- ---- Revenues, other than interest on funds held for clients and PEO revenues $1,508,922 $1,450,633 $2,942,398 $2,823,471 Interest on funds held for clients 110,072 129,918 223,260 245,557 PEO revenues (A) 62,034 59,271 123,253 114,923 ---------- ---------- ---------- ---------- Total revenues 1,681,028 1,639,822 3,288,911 3,183,951 ---------- ---------- ---------- ---------- Operating expenses 691,970 677,102 1,368,322 1,337,060 General, administrative and selling expenses 393,558 410,627 850,119 846,062 Systems development and programming costs 117,540 127,503 233,369 246,577 Depreciation and amortization 68,449 78,524 137,912 160,068 Other(income)expense (20,389) 3,166 (50,911) (35,326) ---------- ---------- ---------- ---------- 1,251,128 1,296,922 2,538,811 2,554,441 ---------- ---------- ---------- ---------- EARNINGS BEFORE INCOME TAXES 429,900 342,900 750,100 629,510 Provision for income taxes 165,300 135,460 288,900 248,670 ---------- ---------- ---------- ---------- NET EARNINGS $ 264,600 $ 207,440 $ 461,200 $ 380,840 ========== ========== ========== ========== BASIC EARNINGS PER SHARE $ 0.43 $ 0.33 $ 0.75 $ 0.60 ========== ========== ========== ========== DILUTED EARNINGS PER SHARE $ 0.42 $ 0.32 $ 0.73 $ 0.59 ========== ========== ========== ========== Dividends per share $ 0.1150 $ 0.1025 $ 0.2175 $ 0.1900 ========== ========== ========== ========== (A) Net of pass-through costs of $649,939 and $651,151, $1,246,401 and $1,243,398, respectively. See notes to the consolidated financial statements.
Form 10Q CONSOLIDATED BALANCE SHEETS --------------------------- (In thousands) (Unaudited) December 31, June 30, Assets 2001 2001 - ------ ----------- ----------- Cash and cash equivalents $ 1,326,967 $ 1,275,356 Short-term marketable securities 407,802 515,245 Accounts receivable 929,370 976,638 Other current assets 275,026 316,221 ----------- ----------- Total current assets 2,939,165 3,083,460 Long-term marketable securities 896,477 806,363 Long-term receivables 213,724 224,964 Land and buildings 468,367 457,110 Data processing equipment 679,873 653,641 Furniture, leaseholds and other 528,916 533,883 ----------- ----------- 1,677,156 1,644,634 Less accumulated depreciation (1,074,068) (1,029,984) ----------- ----------- Total property, plant and equipment 603,088 614,650 Other assets 230,934 219,133 Goodwill 1,293,620 1,151,874 Other intangibles 448,579 449,536 ----------- ----------- Total assets before funds held for clients 6,625,587 6,549,980 Funds held for clients 10,995,695 11,339,110 ----------- ----------- Total assets $17,621,282 $17,889,090 =========== =========== Liabilities and Shareholders' Equity - ------------------------------------ Accounts payable $ 150,115 $ 156,324 Accrued expenses & other current liabilities 984,031 1,032,273 Income taxes 131,387 147,676 ----------- ----------- Total current liabilities 1,265,533 1,336,273 Long-term debt 94,895 110,227 Other liabilities 243,855 208,880 Deferred income taxes 238,299 207,928 Deferred revenue 83,921 85,931 ----------- ----------- Total liabilities before clients funds obligations 1,926,503 1,949,239 Client funds obligations 10,827,710 11,238,854 ----------- ----------- Total liabilities 12,754,213 13,188,093 Shareholders' equity: Common stock 63,870 63,870 Capital in excess of par value 420,177 553,927 Retained earnings 5,480,074 5,153,408 Treasury stock (946,448) (837,244) Accumulated other comprehensive income (150,604) (232,964) ----------- ----------- Total shareholders' equity 4,867,069 4,700,997 ----------- ----------- Total liabilities and shareholders' equity $17,621,282 $17,889,090 =========== =========== See notes to the consolidated financial statements.
Form 10Q CONSOLIDATED STATEMENTS OF CASH FLOWS ------------------------------------- (In thousands) (Unaudited) Six Months Ended December 31, 2001 2000 ---------- ---------- Cash Flows From Operating Activities: - ------------------------------------- Net earnings $ 461,200 $ 380,840 Expenses not requiring outlay of cash 188,909 183,417 Changes in operating net assets 62,188 (19,150) ---------- ---------- Net cash flows provided by operating activities 712,297 545,107 ---------- ---------- Cash Flows From Investing Activities: - ------------------------------------- Purchase of marketable securities (2,058,862) (5,578,302) Proceeds from sale of marketable securities 2,477,841 1,581,357 Net change in client fund obligations (411,144) 3,744,974 Capital expenditures (65,515) (90,915) Additions to intangibles (47,601) (43,543) Acquisitions of businesses, net of cash acquired (122,274) (45,314) Other 6,381 (10,261) ---------- ---------- Net cash flows used in investing activities (221,174) (442,004) ---------- ---------- Cash Flows From Financing Activities: - ------------------------------------- Net proceeds from short-term borrowings 49,803 26,253 Payments of debt (3,299) (43,317) Proceeds from issuance of common stock 107,661 100,541 Repurchases of common stock (459,143) - Dividends paid (134,534) (120,003) ---------- ---------- Net cash flows used in financing activities (439,512) (36,526) ---------- ---------- Net change in cash and cash equivalents 51,611 66,577 Cash and cash equivalents, beginning of period 1,275,356 1,227,637 ---------- ---------- Cash and cash equivalents, end of period $1,326,967 $1,294,214 ========== ========== See notes to the consolidated financial statements.
Form 10Q NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS ---------------------------------------------- (Unaudited) The information furnished herein reflects all adjustments which are, in the opinion of management, necessary for a fair presentation of the results for the interim periods. Adjustments are of a normal recurring nature. The results of operations for the six months ended December 31, 2001 may not be indicative of the results to be expected for the year ending June 30, 2002. These statements should be read in conjunction with the annual financial statements and related notes of Automatic Data Processing, Inc. (ADP or the Company) for the year ended June 30, 2001. Certain reclassifications have been made to prior period financial statements to conform to the current presentation. Note A - The calculation of basic and diluted earnings per share (EPS) is as follows: (In thousands, except EPS) Periods ended December 31, 2001 ---------------------------------------------------- Three Month Period Six Month Period ------------------------ ------------------------- Income Shares EPS Income Shares EPS Basic $264,600 617,335 $0.43 $461,200 618,957 $0.75 Effect of zero coupon subordinated notes 403 2,410 879 2,556 Effect of stock options - 10,492 - 9,988 -------- ------- -------- ------- Diluted $265,003 630,237 $0.42 $462,079 631,501 $0.73 ======== ======= ===== ======== ======= ===== Periods ended December 31, 2000 ----------------------------------------------------- Three Month Period Six Month Period ------------------------- ------------------------- Income Shares EPS Income Shares EPS Basic $207,440 632,082 $0.33 $380,840 631,035 $0.60 Effect of zero coupon subordinated notes 635 3,820 1,314 3,947 Effect of stock options - 15,905 - 15,425 ------- ------- -------- ------- Diluted $208,075 651,807 $0.32 $382,154 650,407 $0.59 ======== ======= ===== ======== ======= ===== Note B - On July 1, 2001, the Company adopted Financial Accounting Standards Board Statement of Financial Accounting Standard No. 141, "Business Combinations" (SFAS 141) and Statement of Financial Accounting Standard No. 142 "Goodwill and Other Intangible Assets" (SFAS 142). SFAS 141 requires that the purchase method of accounting be used for all business combinations initiated after June 30, 2001. The adoption of SFAS 141 did not have a material effect on the Company's results of operations or financial position.
Form 10Q SFAS 142 requires that goodwill and intangible assets with indefinite useful lives no longer be amortized, but instead be tested for impairment at least annually. SFAS 142 also requires intangible assets with finite useful lives be amortized over their respective estimated useful lives and reviewed for impairment in accordance with SFAS No. 121, "Accounting for Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of." The Company completed its assessment of impairment as of July 1, 2001, which indicated no impairment of goodwill. Prior to fiscal year 2002, the Company amortized goodwill over periods from 10 to 40 years. Pro forma net income and earnings per share for the three months and six months ended December 31, 2000, adjusted to eliminate historical amortization of goodwill and related tax effects, are as follows: (In thousands, except EPS) Three months ended Six months ended December 31, December 31, 2000 2000 ---- ---- Previously reported net earnings $207,440 $380,840 Goodwill amortization 13,450 25,925 Tax provision (1,664) (3,283) -------- -------- Pro forma net earnings $219,226 $403,482 ======== ======== Previously reported basic EPS $ 0.33 $ 0.60 Previously reported diluted EPS $ 0.32 $ 0.59 Pro forma basic EPS $ 0.35 $ 0.64 Pro forma diluted EPS $ 0.34 $ 0.62 Note C - Other (income) expense consists of the following: (In thousands) Three months ended Six months ended December 31, December 31, 2001 2000 2001 2000 ---- ---- ---- ---- Interest income on corporate funds $(24,280) $(43,817) $(57,825) $(86,211) Realized (gains)losses on investments (2,460) 43,634 (6,454) 44,238 Interest expense 6,351 3,349 13,368 6,647 -------- -------- -------- -------- Total other (income)expense $(20,389) $ 3,166 $(50,911) $(35,326) ======== ========= ======== ========
Form 10Q Note D - Comprehensive income for the three months and six months ended December 31, 2001 and 2000 is as follows: Three months ended Six months ended December 31, December 31, 2001 2000 2001 2000 ---- ---- ---- ---- Net earnings $264,600 $207,440 $461,200 $380,840 Other comprehensive income: Foreign currency translation adjustment 9,016 23,574 47,418 (44,399) Unrealized gains(losses) on securities (41,442) 39,405 34,942 54,944 -------- -------- -------- -------- Comprehensive income $232,174 $270,419 $543,560 $391,385 ======== ======== ======== ======== Note E - Interim financial data by segment: ADP evaluates performance of its business units based on recurring operating results before interest on corporate funds, interest expense, realized gains and losses on investments, foreign currency gains and losses, and income taxes. Certain revenues and expenses are charged to business units at a standard rate for management and motivational reasons. Other costs are recorded based on management responsibility. As a result, various income and expense items, including certain non-recurring gains and losses, are recorded at the corporate level and certain shared costs are not allocated. Goodwill amortization is charged to business units to act as a surrogate for the cost of capital for acquisitions, which is subsequently eliminated in consolidation. Interest on invested funds held for clients are recorded in Employer Services' revenues at a standard rate of 6%, with the adjustment to actual revenues included in Other. Prior year's business unit revenues and pre-tax earnings have been restated to reflect the current year's budgeted foreign exchange rates. Results of the Company's three largest business units, Employer Services, Brokerage Services and Dealer Services, are shown below. Three months ended December 31, ---------------------------------------- (In millions) Employer Brokerage Dealer Services Services Services ----------- ----------- ----------- 2001 2000 2001 2000 2001 2000 ---- ---- ---- ---- ---- ---- Revenues $1,026 $972 $364 $367 $174 $169 Pre-tax earnings $ 274 $225 $ 64 $ 61 $ 30 $ 27 Six months ended December 31, ----------------------------------------- Employer Brokerage Dealer Services Services Services ---------- ----------- ----------- 2001 2000 2001 2000 2001 2000 ---- ---- ---- ---- ---- ---- Revenues $1,998 $1,873 $724 $726 $349 $334 Pre-tax earnings $ 489 $ 401 $130 $124 $ 57 $ 48
Form 10Q Note F - The Company's short-term financing is sometimes obtained on a secured basis through the use of repurchase agreements, which are collateralized principally by U.S. government securities. These agreements generally have terms ranging from overnight to up to 10 days. There were $49 million in outstanding repurchase agreements at December 31, 2001 and no outstanding balance as of December 31, 2000. For the quarter and six months ended December 31, 2001, the Company had an average outstanding balance of approximately $707 million and $611 million, respectively, at an average interest rate of 2.7%. Note G - In October 2001, the Company entered into a new $4.0 billion unsecured revolving credit agreement with certain financial institutions, replacing an existing $2.5 billion credit agreement. The interest rate applicable to the borrowings is tied to LIBOR or prime rate depending on the notification provided to the syndicated financial institutions prior to borrowing. The Company is also required to pay a facility fee on the credit agreement. The agreement, which expires in October 2002, has no borrowings to date. MANAGEMENT'S DISCUSSION AND ANALYSIS ------------------------------------ RESULTS OF OPERATIONS Revenues and earnings again reached record levels during the quarter ended December 31, 2001. Revenues and revenue growth by ADP's major business units for the three months and six months ended December 31, 2001 and 2000 are as follows: ($'s in millions) Revenues ------------------------------------------ Three Months Ended Six Months Ended December 31, December 31 ------------------ ---------------- 2001 2000 2001 2000 ------ ------ ------ ------ Employer Services $1,026 $ 972 $1,998 $1,873 Brokerage Services 364 367 724 726 Dealer Services 174 169 349 334 Other 117 132 218 251 ------ ------ ------ ------ Total revenues $1,681 $1,640 $3,289 $3,184 ====== ====== ====== ====== Revenue Growth ------------------------------------------ Three Months Ended Six Months Ended December 31, December 31, ------------------ ----------------- 2001 2000 2001 2000 ------ ------ ------ ------ Employer Services 6% 14% 7% 14% Brokerage Services (1) 18 - 28 Dealer Services 3 (9) 4 (9) Other (11) 15 (13) 18 Total revenues 3% 12% 3% 14%
Form 10Q Consolidated revenues for the quarter of approximately $1.7 billion increased 3% from last year. Revenue growth in Employer Services was 6%, as new business sales were flat with last year. Growth was offset by lower pays per control (the number of employees our client's pay) and lower retention, as a result of the weak economy. Brokerage Services revenues declined 1%. Excluding the recent acquisition of IBM's output services print business, Brokerage Services revenues declined 7%. The mix of back office client transactions in the quarter resulted in lower revenue per trade and the continued reduction in discretionary spending in the financial services industry, particularly in research and implementation services, also contributed to the decline. Postage revenues, which are primarily offset by postage expenses, declined as a result of our ongoing effort to transition the proxy mailing and voting process towards electronic delivery and the "householding," or the consolidation of customer accounts. Dealer Services revenue growth was 3% in the quarter. The primary components of Other revenues are Claims Services, foreign exchange differences and miscellaneous processing services. In addition, Other revenues have been adjusted for the difference between actual interest income earned on invested funds held for clients and interest credited to Employer Services at a standard rate of 6%. Claims Services revenues increased 3% partially offsetting net declines in the other components. The prior year's business unit revenues and pre-tax earnings have been restated to reflect the current year's budgeted foreign exchange rates. Systems development and programming costs decreased in the quarter due to cost containment initiatives primarily related to the maintenance of existing applications, while funding of investments in new products continued. In July 2001, the Company adopted SFAS No. 142, "Goodwill and Other Intangibles Assets," which requires that goodwill no longer be amortized, but instead be tested for impairment at least annually. The decrease in amortization expense is due to the adoption of SFAS 142. The Company completed its assessment of impairment as of July 2001, which indicated no impairment of goodwill. Pre-tax earnings for the quarter increased 21% to $429.9 million from $356.4 million in the prior year quarter adjusted for the pro forma impact of SFAS 142. In the quarter ended December 31, 2000, the Company recorded a $45 million write-off ($27 million after-tax) of its $90 million investment in Bridge Information Systems, Inc. (Bridge). Pre-tax earnings for the quarter increased 7% to $429.9 million from $401.4 million in the prior year quarter as adjusted for the pro forma impact of SFAS 142 and the impact of the prior year non-recurring write-off of the Bridge investment. Consolidated pre-tax margins increased over the previous year as cost containment initiatives benefited each of our businesses and continued automation and operating efficiencies have enabled the Company to offset accelerated investments in new products. The effective income tax rate was 38.5% of pre-tax earnings in the current quarter compared to 39.5% in the prior year quarter. The decrease in the effective income tax rate was primarily due to the adoption of SFAS 142 and the elimination of goodwill amortization expense in the current year quarter. Adjusting the prior year for the pro forma impact of SFAS 142, the effective income tax rate was 38.5%.
Form 10Q Net earnings for the quarter increased 21% to $264.6 million from $219.2 million in the prior year quarter adjusted for the pro forma impact of SFAS 142. Net earnings for the quarter increased 7% to $264.6 million from $246.2 million in the prior year quarter adjusted for the pro forma impact of SFAS 142 and prior to the write-off of the Bridge investment. Diluted earnings per share on fewer shares outstanding, primarily resulting from the Company share repurchases, increased 24% to $0.42 from $0.34 in the prior year quarter adjusted for the pro forma impact of SFAS 142. Diluted earnings per share increased 11% adjusted for the pro forma impact of SFAS 142 and prior to the Bridge write-off. We expect consolidated revenue growth in the mid single-digits and we project double-digit earnings per share growth over fiscal 2001 pro forma full year results. FINANCIAL CONDITION The Company's financial condition and balance sheet remain exceptionally strong. At December 31, 2001, the Company had cash and marketable securities of $2.6 billion. Shareholders' equity was $4.9 billion and the ratio of long-term debt to equity was 2%. Capital expenditures for fiscal 2002 are expected to approximate $175 million, compared to $185 million in fiscal 2001. LIQUIDITY AND CAPITAL RESOURCES Cash flows generated from operations were $712.3 million for the six months ended December 31, 2001, adding to our strong cash position. Cash flows used in investing activities totaled $221.2 million primarily as a result of additions to our investment portfolio and capital expenditures. Cash flows used in financing activities totaled $439.5 million. In the first six months of fiscal 2002, the Company purchased approximately 9.4 million shares of common stock at an average price per share of approximately $49. As of December 31, 2001, the Company has remaining Board of Directors authorization to purchase up to 43.9 million additional shares. Approximately thirty percent of the Company's overall investment portfolio is invested in overnight interest-bearing instruments, which are therefore impacted immediately by changes in interest rates. The other seventy percent of the Company's investment portfolio is invested in fixed-income securities, with maturities up to ten years, which are also subject to interest rate risk, including reinvestment risk. The Company has historically had the ability to hold these investments until maturity, and therefore this has not had an adverse impact on income or cash flows. The earnings impact of future interest rate changes is based on many factors, which influence the return on the Company's portfolio. These factors include, among others, the overall portfolio mix between short-term and long-term investments. This mix varies during the year and is impacted by daily interest rate changes. A hypothetical change in interest rates of 25 basis points applied to the average projected investment balances for fiscal 2002 would result in an $11 million pre-tax earnings impact over a twelve month period.
Form 10Q The Company's short-term financing is sometimes obtained on a secured basis through the use of repurchase agreements, which are collateralized principally by U.S. government securities. These agreements generally have terms ranging from overnight to up to 10 days. There were $49 million in outstanding repurchase agreements at December 31, 2001 and no outstanding balance as of December 31, 2000. For the quarter and six months ended December 31, the Company had average outstanding balances of approximately $707 million and $611 million, respectively, at an average interest rate of 2.7%. In October 2001, the Company entered into a new $4.0 billion unsecured revolving credit agreement with certain financial institutions, replacing an existing $2.5 billion credit agreement. The interest rate applicable to the borrowings is tied to LIBOR or prime rate depending on the notification provided to the syndicated financial institutions prior to borrowing. The Company is also required to pay a facility fee on the credit agreement. The agreement, which expires in October 2002, has no borrowings to date. OTHER MATTERS Certain member countries of the European Union have transitioned to the Euro as a new common legal currency. The costs of this transition have not had a material effect on our consolidated financial statements. This report contains "forward-looking statements" based on management's expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ from those expressed. Factors that could cause differences include, but are not limited to: ADP's success in obtaining, retaining and selling additional services to clients; the pricing of products and services; changes in laws regulating payroll taxes and employee benefits; overall economic trends, including interest rate and foreign currency trends; stock market activity; auto sales and related industry changes; employment levels; changes in technology; availability of skilled technical associates and the impact of new acquisitions. ADP disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. PART II. OTHER INFORMATION Except as noted below, all other items are either inapplicable or would result in negative responses and, therefore, have been omitted. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS The Company's Annual Meeting of the Shareholders was held on November 13, 2001. The following members were elected to the Company's Board of Directors to hold office for the ensuing year. The votes cast for each director were are follows:
Form 10Q Nominee In Favor Opposed Abstained Not voted - ------- -------- ------- --------- --------- Gregory D. Brenneman 495,187,748 2,974,223 7,094,535 118,813,956 Gary C. Butler 497,826,017 335,954 4,456,266 121,452,225 Joseph A. Califano, Jr. 497,450,259 711,712 4,832,024 121,076,467 Leon G. Cooperman 497,899,837 262,134 4,382,446 121,526,045 George H. Heilmeier 497,815,221 346,750 4,467,062 121,441,429 Ann Dibble Jordan 497,724,571 437,400 4,557,712 121,350,779 Harvey M. Krueger 486,174,669 11,987,302 16,107,614 109,800,877 Frederic V. Malek 497,778,114 383,857 4,504,169 121,404,322 Henry Taub 497,541,111 620,860 4,741,172 121,167,319 Laurence A. Tisch 497,159,034 1,002,937 5,123,249 120,785,242 Arthur F. Weinbach 497,860,823 301,148 4,421,460 121,487,031 Josh S. Weston 497,608,451 553,520 4,673,832 121,234,659 The results of the voting on the additional items indicated below was as follows: (a) To approve an amendment to the Company's 2000 Key Employee's Stock Option Plan, which has been approved by the Board of Directors increasing by 22,000,000 shares the number of shares of Common Stock of the Company that may be acquired upon the exercise of options that may be granted to employees under such plan. The votes of the shareholders on this ratification were as follows: In Favor Opposed Abstained Not voted -------- ------- --------- --------- 451,786,122 46,529,433 3,813,794 152,934 (b) To approve the Company's 2001 Executive Incentive Compensation Plan. The votes of the shareholders on this ratification were as follows: In Favor Opposed Abstained Not voted -------- ------- --------- --------- 452,711,974 45,575,566 3,953,863 40,880 (c) To ratify the appointment of Deloitte & Touche LLP to serve as the Company's independent certified public accountants for the fiscal year begun on July 1, 2001. The votes of the shareholders on this ratification were as follows: In Favor Opposed Abstained Not voted -------- ------- --------- --------- 490,934,847 8,663,820 2,683,626 121,788,179 ITEM 6. EXHIBITS AND REPORTS ON FORM 10-Q (a) Exhibit number Exhibit -------------- ------- 10.8 2000 Key Employees' Stock Option Plan (as amended effective as of August 31, 2001) (Management Compensatory Plan).
Form 10Q SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. AUTOMATIC DATA PROCESSING, INC. ------------------------------- (Registrant) Date: January 31, 2002 /s/ Karen E. Dykstra ------------------------ Karen E. Dykstra Vice President, Finance (Principal Financial Officer) ----------------------------- (Title)