Name: Automatic Data Processing Inc. (NASDAQ:ADP) | Analysis of Debt
Creator: Stock Analysis on Net

Total Debt (Carrying Amount)
Total Debt (Fair Value)
Weighted-average Interest Rate on Debt

Automatic Data Processing Inc., balance sheet: debt

US$ in thousands

	Jun 30, 2021	Jun 30, 2020	Jun 30, 2019	Jun 30, 2018	Jun 30, 2017	Jun 30, 2016
Obligations under reverse repurchase agreements	23,500)	13,600)	262,000)	—)	—)	—)
Short-term debt	—)	1,001,800)	—)	—)	—)	—)
Long-term debt	2,985,000)	1,002,800)	2,002,200)	2,002,400)	2,002,400)	2,007,700)
Total debt (carrying amount)	3,008,500)	2,018,200)	2,264,200)	2,002,400)	2,002,400)	2,007,700)

Based on: 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30), 10-K (reporting date: 2016-06-30).

The total debt carrying amount exhibited relative stability between 2016 and 2018, followed by a period of volatility and a substantial increase by 2021. Total debt remained nearly constant at approximately 2 billion USD for the first three years before fluctuating and eventually peaking at 3.0085 billion USD in June 2021.

Long-Term Debt Trends: Long-term debt remained static at approximately 2 billion USD from 2016 through 2019. A sharp decline occurred in 2020, where the balance fell to 1.0028 billion USD, followed by a substantial increase in 2021 to 2.985 billion USD, representing the highest long-term obligation in the observed period.
Short-Term and Alternative Obligations: Obligations under reverse repurchase agreements were absent until 2019, peaking at 262 million USD that year before decreasing significantly in 2020 and 2021. Short-term debt appeared exclusively in 2020 at 1.0018 billion USD, suggesting a reclassification of long-term debt to current liabilities or a strategic shift in borrowing terms during that fiscal year.
Aggregate Debt Growth: The aggregate debt increased by approximately 49.7% between June 30, 2016, and June 30, 2021. The most significant shift occurred between 2020 and 2021, where total debt grew from 2.0182 billion USD to 3.0085 billion USD, driven almost entirely by the expansion of long-term debt.

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	Jun 30, 2021
Selected Financial Data (US$ in thousands)
Obligations under reverse repurchase agreements	23,500)
Notes	3,060,400)
Other	6,900)
Total debt (fair value)	3,090,800)
Financial Ratio
Debt, fair value to carrying amount ratio	1.03

Based on: 10-K (reporting date: 2021-06-30).

Weighted average effective interest rate on debt: 2.37%

Interest rate	Debt amount¹	Interest rate × Debt amount
0.20%	23,500)	47)
3.47%	1,000,000)	34,700)
1.83%	1,000,000)	18,300)
1.85%	1,000,000)	18,500)
Total	3,023,500)	71,547)
2.37%

Based on: 10-K (reporting date: 2021-06-30).

¹ US$ in thousands

² Weighted-average interest rate = 100 × 71,547 ÷ 3,023,500 = 2.37%

Automatic Data Processing Inc. (NASDAQ:ADP)

Analysis of Debt

Total Debt (Carrying Amount)

Total Debt (Fair Value)

Weighted-average Interest Rate on Debt