Automatic Data Processing Inc (ADP)

Fixed asset turnover

		Jun 30, 2025	Mar 31, 2025	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020
Revenue (ttm)	US$ in thousands	20,560,900	20,202,600	19,903,400	19,523,000	19,202,700	18,912,000	18,586,000	18,309,000	18,012,200	17,662,000	17,247,200	16,881,600	16,498,300	16,107,600	15,696,600	15,366,900	15,005,300	14,645,200	14,591,000	14,564,800
Property, plant and equipment	US$ in thousands	—	—	—	—	—	—	—	1,040,900	681,400	663,500	655,100	1,064,100	1,103,500	650,500	1,116,600	1,111,100	1,146,700	701,400	692,700	1,180,500
Fixed asset turnover		—	—	—	—	—	—	—	17.59	26.43	26.62	26.33	15.86	14.95	24.76	14.06	13.83	13.09	20.88	21.06	12.34

June 30, 2025 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $20,560,900K ÷ $—K
= —

The fixed asset turnover ratio for Automatic Data Processing Inc. displays notable fluctuations over the period from September 2020 to September 2023. Initially, the ratio was 12.34 as of September 30, 2020, indicating a moderate level of sales generated per dollar of fixed assets. The ratio experienced a significant increase by December 31, 2020, reaching 21.06, suggesting improved efficiency in utilizing fixed assets to generate revenue. This upward trend continued into March 31, 2021, with a ratio of 20.88, maintaining high efficiency levels.

However, a decline is observed in June 30, 2021, where the ratio dropped sharply to 13.09, indicating reduced utilization efficiency or potential asset base expansion without a proportional increase in sales. The ratio slightly recovered to 13.83 by September 30, 2021, and modestly increased to 14.06 on December 31, 2021.

A marked improvement appears in March 31, 2022, with the ratio climbing to 24.76, the highest within the observed period, reflecting a significant enhancement in fixed asset productivity or possibly sales growth outpacing asset expansion. This elevated level persisted into June 30, 2022, at 14.95, and further increased in the subsequent quarters, reaching 15.86 on September 30, 2022, and peaking at 26.33 on December 31, 2022. The ratio remained high in early 2023, with values of 26.62 in March and 26.43 in June, maintaining strong fixed asset utilization efficiency.

A decline is seen in the most recent period available, September 30, 2023, with the ratio decreasing to 17.59, indicating a potential easing in fixed asset productivity or increased asset base without a corresponding rise in sales. The data beyond this point is unavailable.

Overall, the fixed asset turnover for the company demonstrated significant variability, with periods of high efficiency interspersed with declines. The peaks towards late 2022 and early 2023 suggest periods of optimized asset utilization, whereas the drops could reflect strategic investments in fixed assets, temporary operational challenges, or shifts in revenue generation efficiency. The recent decline in 2023 warrants attention for potential operational or strategic adjustments, but the stability observed earlier indicates overall effective utilization of fixed assets during most of the period analyzed.