EX-99.1 2 ex99.htm EX 99.1 (EARNINGS RELEASE) ex99.htm

 
 
EXHIBIT 99.1


 
For more information, contact:

Katharine Boyce
Investor Relations Coordinator
Acxiom Corporation
(501) 342-1321
Investor.relations@acxiom.com
EACXM


Acxiom Announces First Quarter Fiscal Year 2011 Results
Q1 highlighted by revenue growth of 5.6% and operating income growth of 77%

LITTLE ROCK, Ark. — July 28, 2010 — Acxiom® Corporation (Nasdaq: ACXM), a global leader in interactive marketing, today announced financial results for the first quarter of fiscal year 2011 ended June 30, 2010. Acxiom will hold a conference call at 10:00 a.m. CDT today to further discuss this information. Interested parties are invited to listen to the call, which will be broadcast via the Internet at www.acxiom.com. The company will reference presentation slides that will be available on the website prior to the call.

John Meyer, Acxiom’s chief executive officer and president, said, “I am pleased with our performance this quarter. Despite uneven economic recovery, we recorded solid year-over-year revenue growth of approximately six percent. The majority of this increased revenue was converted into operating income, which increased on an annual basis by almost 77 percent. This increased operating leverage reflects the actions we undertook over the past two years to improve cost and performance efficiencies in our business.”

First Quarter 2011 Highlights:

·  
Revenue increased by 5.6% in the current quarter ended June 30, 2010 to $270.4 million, compared to $256.0 million for the quarter ended June 30, 2009.

·  
Income from operations of $22.1 million in the current-year first quarter, up 76.7%, compared to income from operations of $12.5 million in the first quarter of the prior year.

·  
Earnings per diluted share of $0.12 in the current quarter, compared to earnings per diluted share of $0.05 in the first quarter of fiscal 2010.
 
 
 
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·  
Operating cash flow of $17.0 million compared to $16.2 million in the first quarter a year ago.

·  
Free cash flow available to equity of negative $6.3 million, compared to negative $13.2 million in the first quarter a year ago. Free cash flow available to equity is a non-GAAP financial measure; a reconciliation to the comparable GAAP measure, operating cash flow, is attached to this news release.

Operational Highlights:

·  
Information Services: Revenue for the quarter ended June 30, 2010 was $210.7 million, up 5.7%, compared to $199.3 million for the quarter ended June 30, 2009. Income from operations for the current first quarter was $20.9 million, up 31.8% compared to $15.8 million in the prior-year first quarter.

·  
Information Products: Revenue for the quarter increased 5.4% to $59.7 million, compared with $56.7 million in the first quarter a year ago. Income from operations for the quarter was $1.1 million, compared to loss from operations of $3.0 million in the first quarter of the previous year.

·  
Brazil Acquisition: The company announced a strategic expansion into the South American market with the signing of a definitive agreement for the acquisition of a controlling interest in GoDigital, a data quality and precision marketing company in Sao Paulo and Porto Alegre, Brazil. Founded in 2000, GoDigital has two unique, proprietary products – GoQuality, which offers total data quality management, and Claridata, a web-based suite that offers multichannel marketing campaign management and geo-analytical indicators for targeted marketing and campaign analysis.

Web Link to Financials

You may link to http://www.acxiom.com/FY11_Q1_Financials for the detailed financial information we typically attach to our earnings releases.

About Acxiom

Acxiom is a recognized leader in marketing technology and services that enable marketers to successfully manage audiences, personalize consumer experiences and create profitable customer relationships. Our superior industry-focused, consultative approach combines consumer data and analytics, databases, data integration and consulting solutions for personalized, multichannel marketing strategies. Acxiom leverages over 40 years of experience of data
 
 
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management to deliver high-performance, highly secure, reliable information management services. Founded in 1969, Acxiom is headquartered in Little Rock, Arkansas, USA, and serves clients around the world from locations in the United States, Europe, Asia-Pacific, South America and the Middle East. For more information about Acxiom, visit Acxiom.com.
 
Forward Looking Statements

This release and today’s conference call may contain forward-looking statements including, without limitation, statements regarding an improvement in the economic outlook, and a continued return to our historical seasonal revenue and operating income patterns. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially. The following are factors, among others, that could cause actual results to differ materially from these forward-looking statements: the possibility that certain contracts may not generate the anticipated revenue or profitability or may not be closed within the anticipated time frames; the possibility that significant customers may experience extreme, severe economic difficulty or otherwise reduce the amount of business they do with us; the possibility that we will not successfully complete customer contract requirements on time or meet the service levels specified in the contracts, which may result in contract penalties or lost revenue; the possibility that we may not be able to attract, retain or motivate qualified technical, sales and leadership associates, or that we may lose key associates to other organizations; the possibility that we will not be able to continue to receive credit upon satisfactory terms and conditions; the possibility that negative changes in economic conditions in general or other conditions might lead to a reduction in demand for our products and services; the possibility that there will be changes in consumer or business information industries and markets that negatively impact the company; the possibility that the historical seasonality of our business may change; the possibility that we will not be able to achieve cost reductions and avoid unanticipated costs; the possibility that the fair value of certain of our assets may not be equal to the carrying value of those assets now or in future time periods; the possibility that changes in accounting pronouncements may occur and may impact these forward-looking statements; the possibility that we may encounter difficulties when entering new markets or industries; and other risks and uncertainties, including those detailed from time to time in our periodic reports filed with the Securities and Exchange Commission, including our current reports on Form 8-K, quarterly reports on Form 10-Q and annual report on Form 10-K, particularly the discussion under the caption “Item 1A, RISK FACTORS” in our Annual Report on Form 10-K for the year ended March 31, 2010, which was filed with the Securities and Exchange Commission on May 26, 2010.

 
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With respect to the provision of products or services outside our primary base of operations in the United States, all of the above factors apply, along with the difficulty of doing business in numerous sovereign jurisdictions due to differences in scale, competition, culture, laws and regulations.

We undertake no obligation to update the information contained in this press release or any other forward-looking statement.

Acxiom is a registered trademark of Acxiom Corporation.
 
 
 
4
 

                     
ACXIOM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except earnings per share)
                     
                     
         
  For the Three Months Ended
         
June 30,
                 
$
%
         
2010
  
2009
  
Variance
Variance
                     
Revenue:
                    
    Services
        
210,656
  
199,326
  
11,330
5.7%
    Products
      
59,739
  
56,655
  
3,084
5.4%
     Total revenue
      
270,395
  
255,981
  
14,414
5.6%
                     
Operating costs and expenses:
                
    Cost of revenue
                  
     Services
      
164,650
  
159,576
  
(5,074)
(3.2%)
     Products
      
45,771
  
45,919
  
148
0.3%
     Total cost of revenue
    
210,421
  
205,495
  
(4,926)
(2.4%)
                     
    Services gross margin
    
21.8%
  
19.9%
      
    Products gross margin
    
23.4%
  
18.9%
      
    Total gross margin
      
22.2%
  
19.7%
      
                     
    Selling, general and administrative
  
37,955
  
37,643
  
(312)
(0.8%)
    Gains, losses and other items, net
  
                   (57)
  
347
  
404
116.4%
                     
        Total operating costs and expenses
  
248,319
  
243,485
  
(4,834)
(2.0%)
                     
    Income from operations
    
22,076
  
12,496
  
9,580
76.7%
                     
   Other income (expense):
                
     Interest expense
      
(5,898)
  
(5,505)
  
(393)
(7.1%)
     Other, net
      
(451)
  
(118)
  
(333)
(282.2%)
                     
   Total other income (expense)
    
              (6,349)
  
               (5,623)
  
(726)
(12.9%)
                     
   Earnings before income taxes
    
15,727
  
6,873
  
8,854
128.8%
                     
   Income taxes
      
6,291
  
                 2,679
  
(3,612)
(134.8%)
                     
   Net earnings
      
9,436
  
4,194
  
5,242
125.0%
                     
  Less: Net earnings (loss) attributable to noncontrolling interest
(369)
  
                         -
  
(369)
                    -
                     
  Net earnings attributable to Acxiom
  
9,805
  
4,194
  
5,611
133.8%
                     
Earnings per share:
                  
                     
    Basic
        
0.12
  
0.05
  
0.07
140.0%
                     
    Diluted
        
0.12
  
0.05
  
0.07
140.0%
                     
Earnings per share attributable to Acxiom stockholders:
            
                     
    Basic
        
0.12
  
0.05
  
0.07
140.0%
                     
    Diluted
        
0.12
  
0.05
  
0.07
140.0%
                     

 
5
               
ACXIOM CORPORATION AND SUBSIDIARIES
CALCULATION OF EARNINGS PER SHARE
(Unaudited)
(In thousands, except earnings per share)
               
               
         
  For the Three Months Ended
               
         
June 30,
  
June 30,
         
2010
  
2009
               
Basic earnings per share:
          
               
    Numerator - net earnings
    
9,436
  
4,194
               
    Denominator - weighted-average shares outstanding
79,741
  
78,667
               
        Basic earnings per share
    
0.12
  
0.05
               
Diluted earnings per share:
          
               
    Numerator - net earnings
    
9,436
  
4,194
               
    Denominator - weighted-average shares outstanding
79,741
  
78,667
               
    Dilutive effect of common stock options, warrants and restricted stock
                     1,715
  
                        345
               
         
81,456
  
79,012
               
        Diluted earnings per share
    
0.12
  
0.05
               
               
               
               
               
Basic earnings per share attributable to Acxiom stockholders:
      
               
    Numerator - net earnings attributable to Acxiom
9,805
  
4,194
               
    Denominator - weighted-average shares outstanding
79,741
  
78,667
               
        Basic earnings per share attributable to Acxiom stockholders
0.12
  
0.05
               
Diluted earnings per share attributable to Acxiom stockholders:
      
               
    Numerator - net earnings attributable to Acxiom
9,805
  
4,194
               
    Denominator - weighted-average shares outstanding
79,741
  
78,667
               
    Dilutive effect of common stock options, warrants, and restricted stock
                     1,715
  
                        345
               
         
81,456
  
79,012
               
        Diluted earnings per share attributable to Acxiom stockholders
0.12
  
0.05
               

 
6 
 

               
ACXIOM CORPORATION AND SUBSIDIARIES
RESULTS BY SEGMENT
(Unaudited)
(Dollars in thousands)
               
               
         
  For the Three Months Ended
               
         
June 30,
  
June 30,
Revenue:
        
2010
  
2009
               
Information services
      
210,656
  
199,326
Information products
      
59,739
  
56,655
               
Total revenue
      
270,395
  
255,981
               
               
Income from operations:
          
               
Information services
      
20,879
  
15,838
Information products
      
1,140
  
(2,995)
Other
        
57
  
(347)
               
Total income from operations
    
22,076
  
12,496
               
Margin:
              
               
Information services
      
9.9%
  
7.9%
Information products
      
1.9%
  
-5.3%
               
Total margin
      
8.2%
  
4.9%

 
7 
 

             
ACXIOM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands)
             
 
June 30,
  
March 31,
  
$
%
 
2010
  
2010
  
Variance
Variance
Assets
            
Current assets:
            
  Cash and cash equivalents
218,457
  
224,104
  
(5,647)
(2.5%)
  Trade accounts receivable, net
                  183,644
  
                  168,522
  
15,122
9.0%
  Deferred income taxes
                    11,765
  
                    11,874
  
(109)
(0.9%)
  Other current assets
                    52,799
  
                    54,205
  
(1,406)
(2.6%)
             
     Total current assets
                  466,665
  
                  458,705
  
7,960
1.7%
             
Property and equipment
                  840,179
  
                  824,084
  
16,095
2.0%
  Less - accumulated depreciation and amortization
                  599,839
  
                  587,245
  
12,594
2.1%
             
Property and equipment, net
                  240,340
  
                  236,839
  
3,501
1.5%
             
Software, net of accumulated amortization
                    34,771
  
                    38,845
  
(4,074)
(10.5%)
Goodwill
                  464,374
  
                  470,261
  
(5,887)
(1.3%)
Purchased software licenses, net of accumulated amortization
                    49,005
  
                    51,356
  
(2,351)
(4.6%)
Deferred costs, net
                    72,983
  
                    68,914
  
4,069
5.9%
Data acquisition costs
                    20,945
  
                    21,931
  
(986)
(4.5%)
Other assets, net
                    14,944
  
                    16,569
  
(1,625)
(9.8%)
             
 
1,364,027
  
1,363,420
  
607
0.0%
             
Liabilities and Stockholders' Equity
            
Current liabilities:
            
  Current installments of long-term debt
                    42,169
  
                    42,106
  
63
0.1%
  Trade accounts payable
                    40,041
  
                    42,774
  
(2,733)
(6.4%)
  Accrued payroll and related expenses
                    27,664
  
                    36,517
  
(8,853)
(24.2%)
  Other accrued expenses
                    74,826
  
                    75,632
  
(806)
(1.1%)
  Deferred revenue
                    56,335
  
                    55,567
  
768
1.4%
  Income taxes
                      3,965
  
                      2,460
  
1,505
61.2%
             
   Total current liabilities
                  245,000
  
                  255,056
  
(10,056)
(3.9%)
             
Long-term debt
                  459,833
  
                  458,629
  
1,204
0.3%
             
Deferred income taxes
                    63,595
  
                    61,284
  
2,311
3.8%
             
Other liabilities
                      9,915
  
                      9,954
  
(39)
(0.4%)
             
  Stockholders' equity:
            
  Common stock
                    11,715
  
                    11,662
  
53
0.5%
  Additional paid-in capital
                  821,649
  
                  814,929
  
6,720
0.8%
  Retained earnings
                  492,048
  
                  482,243
  
9,805
2.0%
  Accumulated other comprehensive income (loss)
(4,855)
  
4,167
  
(9,022)
(216.5%)
  Treasury stock, at cost
(738,601)
  
(738,601)
  
0
0.0%
Total Acxiom stockholders' equity
581,956
  
574,400
  
7,556
1.3%
  Noncontrolling interest
3,728
  
                      4,097
  
(369)
(9.0%)
             
  Total equity
                  585,684
  
                  578,497
  
7,187
1.2%
             
 
1,364,027
  
1,363,420
  
607
0.0%
             

 
8 
 

       
ACXIOM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
       
 
    For the Three Months Ended
       
 
June 30,
       
 
2010
  
2009
       
Cash flows from operating activities:
      
  Net earnings
                  9,436
  
                  4,194
  Non-cash operating activities:
      
    Depreciation and amortization
                35,986
  
                40,595
    Deferred income taxes
                  1,435
  
                  2,496
    Non-cash stock compensation expense
                  2,972
  
                  2,388
    Changes in operating assets and liabilities:
      
      Accounts receivable
              (16,836)
  
(4,335)
      Other assets
                (1,467)
  
4,651
      Deferred costs
                (9,981)
  
(906)
      Accounts payable and other liabilities
                (7,121)
  
              (32,017)
      Deferred revenue
                  2,564
  
                   (900)
      Net cash provided by operating activities
                16,988
  
                16,166
Cash flows from investing activities:
      
    Capitalized software
(1,226)
  
(2,384)
    Capital expenditures
                (8,752)
  
                (7,431)
    Data acquisition costs
                (4,326)
  
                (5,777)
    Payment received from investments
                     175
  
                         -
    Net cash paid in acquisitions
                (1,978)
  
                         -
      Net cash used by investing activities
(16,107)
  
(15,592)
Cash flows from financing activities:
      
    Payments of debt
(8,964)
  
(13,724)
    Sale of common stock
                  3,801
  
                  2,427
    Acquisition of treasury stock
                         -
  
                   (307)
      Net cash used by financing activities
                (5,163)
  
              (11,604)
      Effect of exchange rate changes on cash
                (1,365)
  
                  1,534
       
  Net change in cash and cash equivalents
(5,647)
  
(9,496)
  Cash and cash equivalents at beginning of period
              224,104
  
              177,166
  Cash and cash equivalents at end of period
              218,457
  
              167,670
       
   Supplemental cash flow information:
      
    Cash paid (received) during the period for:
      
      Interest
                  5,780
  
                  5,258
      Income taxes
                  3,358
  
                (5,052)
      Payments on capital leases and installment payment arrangements
                  5,968
  
                  7,794
      Payments on software and data license liabilities
                     893
  
                  3,878
      Other debt payments, excluding line of credit
                  2,103
  
                  2,052
    Noncash investing and financing activities:
      
      Acquisition of property and equipment under capital lease
      
           and installment payment arrangements
10,268
  
                  3,823
       

 
9 
 

                 
ACXIOM CORPORATION AND SUBSIDIARIES
CALCULATION OF FREE CASH FLOW AVAILABLE TO EQUITY
AND RECONCILIATION TO OPERATING CASH FLOW
(Unaudited)
(Dollars in thousands)
                 
                 
   
06/30/09
09/30/09
12/31/09
03/31/10
FY2010
  
06/30/10
                 
Net cash provided by operating activities
          16,166
           60,703
          74,509
           87,904
         239,282
  
          16,988
                 
Plus:
              
 
    Sale of assets
                   -
                    -
            1,058
                  -
             1,058
  
                    -
                 
Less:
              
 
    Capitalized software
(2,384)
 (2,431)
(1,846)
 (1,596)
           (8,257)
  
(1,226)
 
    Capital expenditures
(7,431)
(14,462)
(9,479)
(26,536)
         (57,908)
  
(8,752)
 
    Data acquisition costs
            (5,777)
             (3,004)
            (5,450)
             (4,577)
         (18,808)
  
          (4,326)
 
    Payments on capital leases and installment payment arrangements
            (7,794)
             (7,504)
            (7,309)
             (7,090)
         (29,697)
  
          (5,968)
 
    Payments on software and data license liabilities
            (3,878)
             (1,840)
               (416)
             (1,392)
           (7,526)
  
             (893)
 
    Other required debt payments
            (2,052)
             (2,058)
            (2,091)
             (3,597)
           (9,798)
  
          (2,103)
                 
Total
          (13,150)
             29,404
            48,976
          43,116
         108,346
  
          (6,280)
                 
                 

 
10 
 

 
ACXIOM CORPORATION AND SUBSIDIARIES
 
CONSOLIDATED STATEMENTS OF OPERATIONS
 
(Unaudited)
 
(Dollars in thousands, except earnings per share)
                               
                   
Q1 FY10 to Q1 FY11
        
   
06/30/09
09/30/09
12/31/09
03/31/10
FY2010
  
06/30/10
  
%
$
        
Revenue:
                            
 
Services
199,326
210,213
218,340
221,553
849,432
  
210,656
  
5.7%
11,330
        
 
Products
56,655
60,892
65,467
66,789
249,803
  
59,739
  
5.4%
3,084
        
 
  Total revenue
255,981
271,105
283,807
288,342
1,099,235
  
270,395
  
5.6%
14,414
        
                               
Operating costs and expenses:
                            
 
Cost of revenue
                            
 
  Services
159,576
165,792
163,206
166,085
654,659
  
164,650
  
3.2%
5,074
        
 
  Products
45,919
46,129
46,727
45,835
184,610
  
45,771
  
-0.3%
(148)
        
 
  Total cost of revenue
205,495
211,921
209,933
211,920
839,269
  
210,421
  
2.4%
4,926
        
                               
                               
 
Selling, general and administrative
37,643
37,964
43,477
43,013
162,097
  
37,955
  
0.8%
312
        
 
Gains, losses and other items, net
347
              (27)
              538
         (1,802)
(944)
  
(57)
  
-116.4%
(404)
        
                               
 
     Total operating costs and expenses
243,485
249,858
253,948
253,131
1,000,422
  
248,319
  
2.0%
4,834
        
                               
 
Income from operations
12,496
21,247
29,859
35,211
98,813
  
22,076
  
76.7%
9,580
        
 
  % Margin
4.9%
7.8%
10.5%
12.2%
9.0%
  
8.2%
              
 
Other income (expense)
                            
 
  Interest expense
(5,505)
(5,423)
(5,687)
(5,865)
(22,480)
  
(5,898)
  
7.1%
(393)
        
 
  Other, net
(118)
223
198
122
425
  
(451)
  
282.2%
(333)
        
 
Total other income (expense)
(5,623)
(5,200)
(5,489)
(5,743)
(22,055)
  
(6,349)
  
12.9%
(726)
        
                               
 
Earnings before income taxes
6,873
16,047
24,370
29,468
76,758
  
15,727
  
128.8%
8,854
        
 
Income taxes
2,679
6,602
10,212
13,106
32,599
  
6,291
  
134.8%
3,612
        
                               
 
Net earnings
4,194
9,445
14,158
16,362
44,159
  
9,436
  
125.0%
5,242
        
                               
 
Less: Net earnings (loss) attributable
                            
 
         to noncontrolling interest
                  -
                  -
(104)
(286)
(390)
  
            (369)
  
-
(369)
        
                               
 
Net earnings attributable to Acxiom
4,194
9,445
14,262
16,648
44,549
  
9,805
  
133.8%
5,611
        
                               
                               
 
            Diluted earnings per share
                            
 
             attributable to Acxiom shareholders
0.05
0.12
0.18
0.21
0.56
  
0.12
  
140.0%
0.07
        
                               
                               

 
11 
 

 
ACXIOM CORPORATION AND SUBSIDIARIES
 
RESULTS BY SEGMENT
        
 
(Unaudited)
        
 
(Dollars in thousands)
        
                               
                   
Q1 FY10 to Q1 FY11
        
   
06/30/09
09/30/09
12/31/09
03/31/10
FY2010
  
06/30/10
  
%
$
        
Revenue:
                            
                               
 
Services
199,326
210,213
218,340
221,553
849,432
  
210,656
  
5.7%
11,330
        
 
Products
56,655
60,892
65,467
66,789
249,803
  
59,739
  
5.4%
3,084
        
                               
 
  Total revenue
255,981
271,105
283,807
288,342
1,099,235
  
270,395
  
5.6%
14,414
        
                               
Income from operations:
                            
                               
 
Services
15,838
19,971
27,565
27,639
91,013
  
20,879
  
31.8%
5,041
        
 
Products
(2,995)
1,249
2,832
5,770
6,856
  
1,140
  
-138.1%
4,135
        
 
Other
(347)
27
(538)
1,802
944
  
57
  
-116.4%
404
        
                               
 
Total income from operations
12,496
21,247
29,859
35,211
98,813
  
22,076
  
76.7%
9,580
        
                               
Margin:
                            
                               
 
Services
7.9%
9.5%
12.6%
12.5%
10.7%
  
9.9%
              
 
Products
-5.3%
2.1%
4.3%
8.6%
2.7%
  
1.9%
              
                               
 
  Total
4.9%
7.8%
10.5%
12.2%
9.0%
  
8.2%
              
                               
                               

 
12