ADP To Write-Down Investment in Bridge.Business Editors ROSELAND, N.J.--(BUSINESS WIRE)--Jan. 16, 2001 Automatic Data Processing Same as data processing. , Inc. (NYSE NYSE See: New York Stock Exchange :ADP (1) (Automatic Data Processing) Synonymous with data processing (DP), electronic data processing (EDP) and information processing. (2) (Automatic Data Processing, Inc., Roseland, NJ, www.adp. ), has recorded a $45 million write-down ($27 million after tax) of its $90 million investment in Bridge Information Systems, Inc. in the quarter ended December 31, 2000, Arthur F. Weinbach, chairman and chief executive officer, announced today. In fiscal 1999, ADP divested its Brokerage front-office business to Bridge and, as part of the proceeds, received $90 million of Bridge convertible preferred stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". . Commenting on the write-down, Mr. Weinbach said, "As previously disclosed, Bridge has been operating at a loss and is in need of additional financing. While we do not know the ultimate realization of our investment with certainty, based on the facts available at this time it is clear that the value of our investment has been impaired and a write down is in order. "We expect to learn more about Bridge's prospects and efforts to obtain refinancing in the next several weeks. As additional information becomes known we will keep you informed as we continue to reassess the possibility of a further write-down. "ADP will, as previously scheduled, release our second quarter operating results January 17, 2001. With the exception of this non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. , we remain comfortable with our previous forecast of 16 to 18% earnings per share growth for our full fiscal year ended June 30, 2001," Mr. Weinbach concluded. ADP, with over $6 billion in revenues and 500,000 clients, is one of the largest independent computing services firms in the world. This release contains "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " 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: ADP's success in obtaining, retaining and selling additional services to clients; the pricing of products and services; changes in laws regulating payroll taxes Payroll Tax Tax an employer withholds and/or pays on behalf of their employees based on the wage or salary of the employee. In most countries, including the U.S., both state and federal authorities collect some form of payroll tax. and employee benefits; overall economic trends, including interest rate and foreign currency trends; stock market activity; auto sales Auto Sales The major producers of domestic automobiles report sales monthly. These numbers are seasonally adjusted by the U.S. Department of Commerce and are available to the public one to five business days after the end of each month. and related industry changes; employment levels; changes in technology; availability of skilled technical associates; the impact of new acquisitions, and the ultimate realization of ADP's investment in Bridge Information Systems, Inc. ADP disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. |
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