ADP reports 14% earnings per share increase for fiscal 1996; expects about 15% earnings per share growth in fiscal 1997.

ROSELAND, N.J.--(BUSINESS WIRE)--Aug. 14, 1996--Automatic Data Processing, Inc. achieved record revenue and earnings in its fourth quarter and fiscal year ended June 30, 1996, Arthur F. Weinbach, president and chief executive officer, announced today. This represents ADP's 35th consecutive year of double-digit earnings per share growth since becoming a public company in 1961.

For fiscal 1996, revenue increased 23% to over $3.5 billion. This was ADP's best revenue growth year in the last decade. Revenue growth excluding the November 1995 acquisition of GSI approximated 15%. Pretax earnings increased 19%, net earnings advanced 15% and earnings per share increased 14% to $1.57 from $1.38 last year. The margins of several of the current year acquisitions are lower than ADP's overall margins, and, as expected, consolidated margins decreased slightly.

In the fourth quarter, revenue increased 21% to $968 million and earnings per share increased 14% to $.42 from $.37 last year. Pretax earnings increased 20% and net earnings advanced 13%. Net earnings growth is lower than pretax earnings growth because of an increased effective tax rate caused by an increased mix of taxable vs. non-taxable investments.

During the quarter, a decision was reached to sell GSI's facilities management business. As a result, the revenues of that business are not included in ADP's consolidated results for the quarter.

Commenting on overall results, Mr. Weinbach said, "Revenue growth for the year in Employer, Brokerage and Dealer Services was 18%, 20% and 26%, respectively, aided by acquisitions in each business unit. Our Employer Services sales results and very high Brokerage trade volumes were highlights of an excellent year. We are especially pleased with our strong 1996 earnings growth given the significant investments in strategic acquisitions and new product initiatives which we made during the year. The fourth quarter's results mark our 140th consecutive quarter of record highs in both revenue and earnings per share.

"Our market leadership and the potential of our core businesses favorably position us for continued success. For fiscal 1997 ADP expects double-digit growth in revenue and about 15% growth in earnings per share.

ADP, with over $3.5 billion in revenue and 375,000 clients, is one of the largest independent computing services firms in the world.

Below is a summary of unaudited comparative results. -0-

                           Three Months Ended       Year Ended
                               June 30,              June 30,
                            1996      1995       1996       1995
                            (000's omitted except per share data)

Revenue (R)             $  967,916 $ 799,870 $ 3,566,597 $ 2,893,742
Earnings before income
taxes (R)               $  174,080 $ 144,490 $   635,390  $  534,280
Provision for income taxes $54,080 $  38,550 $   180,690  $  139,450
Net earnings (R)        $  120,000 $ 105,940  $  454,700  $  394,830
Earnings per share (R)  $      .42 $     .37  $     1.57  $     1.38
Average shares
 outstanding               288,812   288,226     288,967     285,112
(R)  Record high

CONTACT: Arthur Schmidt & Associates Inc.

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