Dayforce recurring revenue up 43.8% year-over-year, or 46.0% on a constant currency basis

Total revenue of $370.6 million, up 26.4% year-over-year, or 29.3% on a constant currency basis

Operating profit of $38.4 million and adjusted operating profit of $88.5 million

Ceridian HCM Holding Inc. (“Ceridian”) (NYSE:CDAY) (TSX:CDAY), a global leader in human capital management (HCM) technology, today announced its financial results for the first quarter ended March 31, 2023.

“I am very pleased with our performance in the first quarter – as Dayforce recurring revenue grew 44% or 46% on a constant currency basis and we exceeded our profitability objectives,” said David Ossip, Chair and Co-CEO of Ceridian. “Looking ahead, I continue to be confident in our ability to execute and take market share as demand for our global people platform remains resilient.”

“The strength of the Ceridian community continues to grow – with 6,179 Dayforce customers live and continued expansion of our partner ecosystem,” said Leagh Turner, Co-CEO of Ceridian. “In this dynamic environment, we are seeing more global enterprise organizations choose Ceridian to manage their people operations and drive their transformations given our breadth and depth of product and relentless focus on customer experience.”

“Our first quarter results exceeded guidance across all metrics," said Noemie Heuland, CFO of Ceridian. “We start the year with strong Dayforce recurring revenue growth and continued operating profit expansion. This gives us confidence to raise our Dayforce recurring revenue, excluding float and profitability targets for the year as we progress towards our mid-term commitment of profitable growth.”

Financial Highlights for the First Quarter 2023¹

• Total revenue was $370.6 million, an increase of 26.4%, or 29.3% on a constant currency basis.


• Dayforce recurring revenue was $271.2 million, an increase of 43.8%, or 46.0% on a constant currency basis. Excluding float revenue, Dayforce recurring revenue was $229.6 million, an increase of 27.3%, or 29.3% on a constant currency basis. Tax migration from legacy infrastructure to the same platform as Dayforce contributed approximately 600 basis points of growth to Dayforce recurring revenue, excluding float in the first quarter of 2023.


• Cloud recurring gross margin was 77.3%, compared to 69.3%. Adjusted cloud recurring gross margin was 78.7%, compared to 75.5%.


• Operating profit was $38.4 million, or 10.4% of revenue, compared to operating loss of $18.9 million. Adjusted operating profit was $88.5 million, or 23.9% of revenue, compared to $44.4 million, or 15.1% of revenue.


• Net income was $9.9 million, compared to net loss of $27.4 million. Adjusted net income was $49.3 million, compared to $20.5 million.


• Adjusted EBITDA was $105.4 million, compared to $57.4 million.


• Diluted net income per share was $0.06, compared to diluted net loss of $0.18. Adjusted diluted net income per share was $0.31, compared to $0.13.


• Net cash provided by operating activities was $11.3 million, compared to $5.5 million.

Business Outlook

Based on information available as of May 3, 2023, Ceridian is issuing the following guidance for the second quarter and full year of 2023 as indicated below. Comparisons are on a year-over-year basis, unless stated otherwise.

Second Quarter 2023 Guidance

• Total revenue of $356 million to $360 million, an increase of 18% to 20% or 20% to 22% on a constant currency basis.


• Dayforce recurring revenue, excluding float of $223 million to $225 million, an increase of 22% to 23% or 23% to 24% on a constant currency basis.
  
  
  
  • Tax migration from legacy infrastructure to the same platform as Dayforce is expected to contribute approximately 400 basis points of growth in the second quarter of 2023.
  
  
  
  


• Float revenue of $38 million.


• Adjusted EBITDA of $87 million to $90 million.

Full Year 2023 Guidance

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  • Total revenue of $1,480 million to $1,500 million, an increase of 19% to 20% or 20% to 21% on a constant currency basis.
  
  
  • Dayforce recurring revenue, excluding float of $939 million to $949 million, an increase of 25% to 26% or 26% to 27% on a constant currency basis.
    
    
    
    • Tax migration from legacy infrastructure to the same platform as Dayforce is expected to contribute approximately 460 basis points of growth in fiscal year 2023.
    
    
    
    
  
  
  • Float revenue of $150 million.
  
  
  • Adjusted EBITDA of $366 million to $379 million.