Paychex' profit beats estimates on higher HR services revenue
(Reuters) - Payroll processor Paychex Inc (PAYX.O) reported a first-quarter profit that narrowly beat market estimates, helped by higher revenue from its human resource services business.
The company also reiterated its forecast of a 5 to 7 percent growth in profit for fiscal 2013, but added it sees only a modest increase in revenue per check.
Paychex, which caters to small and medium-sized businesses, said net income rose to $153.1 million, or 42 cents per share, in the first quarter from $148.9 million, or 41 cents per share, a year earlier.
Total revenue rose 3 percent to $578.2 million.
Analysts on an average expected the company to earn 41 cents on revenue of $584.1 million.
Revenue from its human resource services was up 7 percent at $182.2 million, while its biggest segment, payroll service, reported a modest 1 percent growth.
The company, which competes with Automated Data Processor Inc (ADP.O), said checks per payroll rose 2 percent for the quarter.
Checks per payroll, the number of paychecks issued by each client, is an indicator of the health of the small business market in the United States.
Revenue per check grew modestly during the quarter, the company said.
Shares of the Rochester, New York-based company, which has a market value of $12.75 billion, were up about 1 percent in trading after the bell. They had closed at $34.68 on Monday on the Nasdaq.
(Reporting by Avik Das in Bangalore; Editing by Sreejiraj Eluvangal)
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