UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
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CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
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Date of report (Date of earliest event reported): February 4, 2015
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ACXIOM CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
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DELAWARE
(State or Other Jurisdiction of Incorporation)
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0-13163
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71-0581897
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(Commission File Number)
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(IRS Employer Identification No.)
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P.O. Box 8190, 601 E. Third Street,
Little Rock, Arkansas
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72203-8190
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(Address of Principal Executive Offices)
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(Zip Code)
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501-342-1000
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(Registrant’s Telephone Number, Including Area Code)
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Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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o
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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o
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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o
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Exhibit
Number
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Description
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99.1
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Press Release of the Company dated February 4, 2015
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Title:
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Chief Ethics and Legal Officer & Executive Vice President
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Exhibit
Number
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Description
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99.1
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Press Release of the Company dated February 4, 2015
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·
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Marketing and Data Services revenue was $208 million, up 1% compared to the third quarter of fiscal 2014.
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·
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Combined AOS and LiveRamp revenue was $21 million, up approximately 40% compared to the second quarter of fiscal 2015.
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·
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Gross media spend enabled by the AOS platform was $73 million, up 265% compared to the prior year period and up 97% compared to the second quarter of fiscal 2015.
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·
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IT Infrastructure Management revenue was down approximately 16% compared to the same period a year ago.
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·
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Net earnings per diluted share from continuing operations were $0.06 compared to earnings per share of $0.19 a year ago. Earnings per share in the prior year period were positively impacted by a tax adjustment resulting in a $0.04 improvement. Unusual items, non-cash compensation and intangible asset amortization impacted GAAP earnings per share by $0.17 in the quarter. Unusual items included expenses associated with the Company’s restructuring activities and separation and transformation initiatives.
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·
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Operating cash flow from continuing operations was $111 million for the trailing twelve months, down 43% compared to the same period a year ago. Free cash flow to equity was $1 million for the trailing twelve-month period compared to $103 million for the comparable period. The decline was primarily due to changes in working capital, and to a lesser extent, cash restructuring and business transformation expenditures.
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·
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Non-GAAP diluted earnings per share were $0.23 compared to $0.27 a year ago. Earnings per share in the prior year period were positively impacted by a tax adjustment resulting in a $0.04 improvement.
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·
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Non-GAAP operating income was $30 million, down from $32 million for the same period last year.
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·
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Non-GAAP Marketing and Data Services operating margin was roughly 12%, flat compared to the third quarter of fiscal 2014.
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·
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Acxiom signed several Marketing and Data Services agreements during the quarter including new database contracts with Payless ShoeSource and Guardian Media Group, as well as renewals with a major telecommunications company and a leading insurance firm.
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·
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The Company signed 25 new AOS and LiveRamp agreements during the quarter. The AOS and LiveRamp client roster now totals 195 and includes 22 Fortune 100 companies.
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·
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LiveRamp expanded its strategic partnership with Datalogix, which now runs through the end of 2017. Datalogix will continue to leverage LiveRamp as an important partner for data onboarding services used to connect its syndicated and custom segments and its clients’ first-party data assets to digital media.
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·
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Acxiom data is now being distributed to more than 20 partners, including most of the major demand side platforms and leading enterprise software companies. In the quarter, Acxiom joined the Salesforce Analytics Cloud Ecosystem to provide consumer recognition, data assets and value-added analytic insights to Salesforce users.
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·
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Acxiom extended the duration of its existing share repurchase program for an additional year, through November 12, 2015. The Company did not repurchase any shares in the quarter. Since inception of the share repurchase program in August 2011, Acxiom has repurchased 12.9 million shares, or approximately 16% of the outstanding common stock, for $202 million.
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·
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We continue to expect revenue from continuing operations for the fiscal year to be down roughly 4% compared to fiscal year 2014. The decline in revenue is primarily due to the impact of lost IT Infrastructure Management customers and the exit of our analog paper survey business in Europe.
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·
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We continue to expect earnings per diluted share to be in the range of $0.73 to $0.78.
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ACXIOM CORPORATION AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF OPERATIONS
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||||||||||||||||
(Unaudited)
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||||||||||||||||
(Dollars in thousands, except earnings per share)
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||||||||||||||||
For the Three Months Ended
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||||||||||||||||
December 31,
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||||||||||||||||
$ | % | |||||||||||||||
2014
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2013
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Variance
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Variance
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|||||||||||||
Revenue:
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||||||||||||||||
Marketing and data services
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208,246 | 206,662 | 1,584 | 0.8 | % | |||||||||||
IT Infrastructure management services
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52,194 | 62,099 | (9,905 | ) | (16.0 | %) | ||||||||||
Total revenue
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260,440 | 268,761 | (8,321 | ) | (3.1 | %) | ||||||||||
Operating costs and expenses:
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||||||||||||||||
Cost of revenue
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203,728 | 201,430 | 2,298 | 1.1 | % | |||||||||||
Selling, general and administrative
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47,345 | 43,383 | 3,962 | 9.1 | % | |||||||||||
Gains, losses and other items, net
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4,175 | 4,657 | (482 | ) | (10.4 | %) | ||||||||||
Total operating costs and expenses
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255,248 | 249,470 | 5,778 | 2.3 | % | |||||||||||
Income from operations
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5,192 | 19,291 | (14,099 | ) | (73.1 | %) | ||||||||||
% Margin
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2.0 | % | 7.2 | % | ||||||||||||
Other income (expense):
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||||||||||||||||
Interest expense
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(2,610 | ) | (3,114 | ) | 504 | 16.2 | % | |||||||||
Other, net
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(34 | ) | 1,484 | (1,518 | ) | (102.3 | %) | |||||||||
Total other income (expense)
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(2,644 | ) | (1,630 | ) | (1,014 | ) | (62.2 | %) | ||||||||
Earnings from continuing operations before income taxes
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2,548 | 17,661 | (15,113 | ) | (85.6 | %) | ||||||||||
Income taxes
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(1,926 | ) | 3,083 | (5,009 | ) | (162.5 | %) | |||||||||
Net earnings from continuing operations
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4,474 | 14,578 | (10,104 | ) | (69.3 | %) | ||||||||||
Earnings (loss) from discontinued operations, net of tax
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(318 | ) | 489 | (807 | ) | (165.0 | %) | |||||||||
Net earnings
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4,156 | 15,067 | (10,911 | ) | (72.4 | %) | ||||||||||
Less: Net earnings attributable to noncontrolling interest
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- | - | - | - | ||||||||||||
Net earnings attributable to Acxiom
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4,156 | 15,067 | (10,911 | ) | (72.4 | %) | ||||||||||
Basic earnings per share:
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||||||||||||||||
Net earnings from continuing operations
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0.06 | 0.19 | (0.13 | ) | (69.4 | %) | ||||||||||
Earnings from discontinued operations
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- | 0.01 | (0.01 | ) | 0.0 | % | ||||||||||
Net earnings
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0.05 | 0.20 | (0.15 | ) | (75.0 | %) | ||||||||||
Net earnings attributable to Acxiom stockholders
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0.05 | 0.20 | (0.15 | ) | (73.0 | %) | ||||||||||
Diluted earnings per share:
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||||||||||||||||
Net earnings from continuing operations
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0.06 | 0.19 | (0.13 | ) | (69.9 | %) | ||||||||||
Earnings from discontinued operations
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- | 0.01 | (0.01 | ) | 0.0 | % | ||||||||||
Net earnings
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0.05 | 0.19 | (0.14 | ) | (73.7 | %) | ||||||||||
Net earnings attributable to Acxiom stockholders
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0.05 | 0.19 | (0.14 | ) | (72.1 | %) | ||||||||||
ACXIOM CORPORATION AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF OPERATIONS
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||||||||||||||||
(Unaudited)
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||||||||||||||||
(Dollars in thousands, except earnings per share)
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||||||||||||||||
For the Nine Months Ended
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December 31,
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||||||||||||||||
$ | % | |||||||||||||||
2014
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2013
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Variance
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Variance
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|||||||||||||
Revenue:
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||||||||||||||||
Marketing and data services
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599,177 | 595,407 | 3,770 | 0.6 | % | |||||||||||
IT Infrastructure management services
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163,515 | 198,309 | (34,794 | ) | (17.5 | %) | ||||||||||
Total revenue
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762,692 | 793,716 | (31,024 | ) | (3.9 | %) | ||||||||||
Operating costs and expenses:
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||||||||||||||||
Cost of revenue
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601,349 | 596,642 | 4,707 | 0.8 | % | |||||||||||
Selling, general and administrative
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144,766 | 123,857 | 20,909 | 16.9 | % | |||||||||||
Gains, losses and other items, net
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12,556 | 11,241 | 1,315 | 11.7 | % | |||||||||||
Total operating costs and expenses
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758,671 | 731,740 | 26,931 | 3.7 | % | |||||||||||
Income (loss) from operations
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4,021 | 61,976 | (57,955 | ) | (93.5 | %) | ||||||||||
% Margin
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0.5 | % | 7.8 | % | ||||||||||||
Other income (expense):
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||||||||||||||||
Interest expense
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(7,576 | ) | (9,113 | ) | 1,537 | 16.9 | % | |||||||||
Other, net
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(562 | ) | 1,238 | (1,800 | ) | (145.4 | %) | |||||||||
Total other income (expense)
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(8,138 | ) | (7,875 | ) | (263 | ) | (3.3 | %) | ||||||||
Earnings (loss) from continuing operations before income taxes
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(4,117 | ) | 54,101 | (58,218 | ) | (107.6 | %) | |||||||||
Income taxes
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(1,023 | ) | 17,582 | (18,605 | ) | (105.8 | %) | |||||||||
Net earnings (loss) from continuing operations
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(3,094 | ) | 36,519 | (39,613 | ) | (108.5 | %) | |||||||||
Earnings (loss) from discontinued operations, net of tax
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(1,898 | ) | 1,507 | (3,405 | ) | (225.9 | %) | |||||||||
Net earnings (loss)
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(4,992 | ) | 38,026 | (43,018 | ) | (113.1 | %) | |||||||||
Less: Net loss attributable to noncontrolling interest
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- | (60 | ) | 60 | 100.0 | % | ||||||||||
Net earnings (loss) attributable to Acxiom
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(4,992 | ) | 38,086 | (43,078 | ) | (113.1 | %) | |||||||||
Basic earnings (loss) per share:
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||||||||||||||||
Net earnings (loss) from continuing operations
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(0.04 | ) | 0.49 | (0.53 | ) | (108.2 | %) | |||||||||
Earnings (loss) from discontinued operations
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(0.02 | ) | 0.02 | (0.04 | ) | (200.0 | %) | |||||||||
Net earnings (loss)
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(0.06 | ) | 0.51 | (0.57 | ) | (111.8 | %) | |||||||||
Net earnings (loss) attributable to Acxiom stockholders
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(0.06 | ) | 0.51 | (0.57 | ) | (112.7 | %) | |||||||||
Diluted earnings (loss) per share:
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||||||||||||||||
Net earnings (loss) from continuing operations
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(0.04 | ) | 0.48 | (0.52 | ) | (108.4 | %) | |||||||||
Earnings (loss) from discontinued operations
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(0.02 | ) | 0.02 | (0.04 | ) | (200.0 | %) | |||||||||
Net earnings (loss)
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(0.06 | ) | 0.50 | (0.56 | ) | (112.0 | %) | |||||||||
Net earnings (loss) attributable to Acxiom stockholders
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(0.06 | ) | 0.50 | (0.56 | ) | (113.0 | %) | |||||||||
ACXIOM CORPORATION AND SUBSIDIARIES
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||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP EPS
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||||||||||||||||
(Unaudited)
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||||||||||||||||
(Dollars in thousands, except earnings per share)
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||||||||||||||||
For the Three Months Ended
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For the Nine Months Ended
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|||||||||||||||
December 31,
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December 31,
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|||||||||||||||
2014
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2013
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2014
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2013
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|||||||||||||
Earnings (loss) from continuing operations before income taxes
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2,548 | 17,661 | (4,117 | ) | 54,101 | |||||||||||
Income taxes
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(1,926 | ) | 3,083 | (1,023 | ) | 17,582 | ||||||||||
Net earnings (loss) from continuing operations
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4,474 | 14,578 | (3,094 | ) | 36,519 | |||||||||||
Earnings (loss) from discontinued operations, net of tax
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(318 | ) | 489 | (1,898 | ) | 1,507 | ||||||||||
Net earnings (loss)
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4,156 | 15,067 | (4,992 | ) | 38,026 | |||||||||||
Less: Net earnings (loss) attributable to noncontrolling interest
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- | - | - | (60 | ) | |||||||||||
Net earnings (loss) attributable to Acxiom
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4,156 | 15,067 | (4,992 | ) | 38,086 | |||||||||||
Earnings (loss) per share attributable to Acxiom stockholders:
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||||||||||||||||
Basic
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0.05 | 0.20 | (0.06 | ) | 0.51 | |||||||||||
Diluted
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0.05 | 0.19 | (0.06 | ) | 0.50 | |||||||||||
Unusual items:
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||||||||||||||||
Legal settlement accruals
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- | 1,000 | - | 4,200 | ||||||||||||
Purchased intangible asset amortization
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3,783 | 62 | 7,667 | 272 | ||||||||||||
Live Ramp acquisition costs
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- | - | 820 | - | ||||||||||||
Non-cash stock compensation
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8,582 | 3,455 | 20,538 | 10,344 | ||||||||||||
Restructuring charges and other adjustments
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4,175 | 3,657 | 11,737 | 7,041 | ||||||||||||
Separation and transformation costs
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8,116 | 4,897 | 29,444 | 7,083 | ||||||||||||
Gain on investment (other income)
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- | (2,567 | ) | - | (2,567 | ) | ||||||||||
Total unusual items, continuing operations
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24,656 | 10,504 | 70,206 | 26,373 | ||||||||||||
Earnings from continuing operations before income taxes
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||||||||||||||||
and excluding unusual items
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27,204 | 28,165 | 66,089 | 80,474 | ||||||||||||
Income taxes
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8,977 | 6,979 | 23,947 | 27,541 | ||||||||||||
Non-GAAP earnings from continuing operations
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18,227 | 21,186 | 42,142 | 52,933 | ||||||||||||
Earnings from discontinued operations, net of tax
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- | - | - | - | ||||||||||||
Non-GAAP net earnings
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18,227 | 21,186 | 42,142 | 52,933 | ||||||||||||
Less: Net loss attributable to noncontrolling interest
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- | - | - | (60 | ) | |||||||||||
Non-GAAP Net earnings attributable to Acxiom
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18,227 | 21,186 | 42,142 | 52,993 | ||||||||||||
Non-GAAP earnings per share attributable to Acxiom stockholders:
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||||||||||||||||
Basic
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0.24 | 0.28 | 0.55 | 0.71 | ||||||||||||
Diluted
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0.23 | 0.27 | 0.54 | 0.69 | ||||||||||||
Basic weighted average shares
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77,039 | 75,009 | 76,998 | 74,155 | ||||||||||||
Diluted weighted average shares
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78,302 | 77,839 | 78,316 | 76,456 | ||||||||||||
ACXIOM CORPORATION AND SUBSIDIARIES
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||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP INCOME FROM OPERATIONS
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||||||||||||||||
(Unaudited)
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||||||||||||||||
(Dollars in thousands, except earnings per share)
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||||||||||||||||
For the Three Months Ended
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For the Nine Months Ended
|
|||||||||||||||
December 31,
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December 31,
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|||||||||||||||
2014
|
2013
|
2014
|
2013
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|||||||||||||
Income from operations
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5,192 | 19,291 | 4,021 | 61,976 | ||||||||||||
Unusual items
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24,656 | 13,071 | 70,206 | 28,940 | ||||||||||||
Income from operations before unusual items
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29,848 | 32,362 | 74,227 | 90,916 | ||||||||||||
ACXIOM CORPORATION AND SUBSIDIARIES
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||||||||
CALCULATION OF EARNINGS PER SHARE
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||||||||
(Unaudited)
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||||||||
(In thousands, except earnings per share)
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||||||||
For the Three Months Ended
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||||||||
December 31,
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December 31,
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|||||||
2014
|
2013
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|||||||
Basic earnings per share from continuing operations:
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||||||||
Numerator - net earnings
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4,474 | 14,578 | ||||||
Denominator - weighted-average shares outstanding
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77,039 | 75,009 | ||||||
Basic earnings per share
|
0.06 | 0.19 | ||||||
Basic earnings per share - net earnings attributable to Acxiom stockholders:
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||||||||
Numerator - net earnings attributable to Acxiom
|
4,156 | 15,067 | ||||||
Denominator - weighted-average shares outstanding
|
77,039 | 75,009 | ||||||
Basic earnings per share - net earnings attributable to Acxiom stockholders
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0.05 | 0.20 | ||||||
Diluted earnings per share from continuing operations:
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||||||||
Numerator - net earnings
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4,474 | 14,578 | ||||||
Denominator - weighted-average shares outstanding
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77,039 | 75,009 | ||||||
Dilutive effect of common stock options, warrants and restricted stock
|
1,263 | 2,830 | ||||||
78,302 | 77,839 | |||||||
Diluted earnings per share from continuing operations
|
0.06 | 0.19 | ||||||
Diluted earnings per share - net earnings attributable to Acxiom stockholders:
|
||||||||
Numerator - net earnings attributable to Acxiom
|
4,156 | 15,067 | ||||||
Denominator - weighted-average shares outstanding
|
77,039 | 75,009 | ||||||
Dilutive effect of common stock options, warrants, and restricted stock
|
1,263 | 2,830 | ||||||
78,302 | 77,839 | |||||||
Diluted earnings per share - net earnings attributable to Acxiom stockholders
|
0.05 | 0.19 | ||||||
ACXIOM CORPORATION AND SUBSIDIARIES
|
||||||||
CALCULATION OF EARNINGS PER SHARE
|
||||||||
(Unaudited)
|
||||||||
(In thousands, except earnings per share)
|
||||||||
For the Nine Months Ended
|
||||||||
December 31,
|
December 31,
|
|||||||
2014
|
2013
|
|||||||
Basic earnings (loss) per share from continuing operations:
|
||||||||
Numerator - net earnings (loss)
|
(3,094 | ) | 36,519 | |||||
Denominator - weighted-average shares outstanding
|
76,998 | 74,155 | ||||||
Basic earnings (loss) per share
|
(0.04 | ) | 0.49 | |||||
Basic earnings (loss) per share - net earnings (loss) attributable to Acxiom stockholders:
|
||||||||
Numerator - net earnings (loss) attributable to Acxiom
|
(4,992 | ) | 38,086 | |||||
Denominator - weighted-average shares outstanding
|
76,998 | 74,155 | ||||||
Basic earnings (loss) per share - net earnings (loss) attributable to Acxiom stockholders
|
(0.06 | ) | 0.51 | |||||
Diluted earnings (loss) per share from continuing operations:
|
||||||||
Numerator - net earnings (loss)
|
(3,094 | ) | 36,519 | |||||
Denominator - weighted-average shares outstanding
|
76,998 | 74,155 | ||||||
Dilutive effect of common stock options, warrants and restricted stock
|
- | 2,301 | ||||||
76,998 | 76,456 | |||||||
Diluted earnings (loss) per share from continuing operations
|
(0.04 | ) | 0.48 | |||||
Diluted earnings (loss) per share - net earnings (loss) attributable to Acxiom stockholders:
|
||||||||
Numerator - net earnings (loss) attributable to Acxiom
|
(4,992 | ) | 38,086 | |||||
Denominator - weighted-average shares outstanding
|
76,998 | 74,155 | ||||||
Dilutive effect of common stock options, warrants, and restricted stock
|
- | 2,301 | ||||||
76,998 | 76,456 | |||||||
Diluted earnings (loss) per share - net earnings (loss) attributable to Acxiom stockholders
|
(0.06 | ) | 0.50 | |||||
ACXIOM CORPORATION AND SUBSIDIARIES
|
||||||||
RESULTS BY SEGMENT
|
||||||||
(Unaudited)
|
||||||||
(Dollars in thousands)
|
||||||||
For the Three Months Ended
|
||||||||
December 31,
|
December 31,
|
|||||||
Revenue:
|
2014
|
2013
|
||||||
Marketing and data services
|
208,246 | 206,662 | ||||||
IT Infrastructure management services
|
52,194 | 62,099 | ||||||
Total revenue
|
260,440 | 268,761 | ||||||
Income from continuing operations:
|
||||||||
Marketing and data services
|
13,703 | 22,529 | ||||||
IT Infrastructure management services
|
3,780 | 6,316 | ||||||
Corporate
|
(12,291 | ) | (9,554 | ) | ||||
Total income from continuing operations
|
5,192 | 19,291 | ||||||
Margin:
|
||||||||
Marketing and data services
|
6.6 | % | 10.9 | % | ||||
IT Infrastructure management services
|
7.2 | % | 10.2 | % | ||||
Total margin
|
2.0 | % | 7.2 | % | ||||
ACXIOM CORPORATION AND SUBSIDIARIES
|
||||||||
RESULTS BY SEGMENT
|
||||||||
(Unaudited)
|
||||||||
(Dollars in thousands)
|
||||||||
For the Nine Months Ended
|
||||||||
December 31,
|
December 31,
|
|||||||
Revenue:
|
2014
|
2013
|
||||||
Marketing and data services
|
599,177 | 595,407 | ||||||
IT Infrastructure management services
|
163,515 | 198,309 | ||||||
Total revenue
|
762,692 | 793,716 | ||||||
Income from continuing operations:
|
||||||||
Marketing and data services
|
33,372 | 51,256 | ||||||
IT Infrastructure management services
|
12,649 | 29,044 | ||||||
Corporate
|
(42,000 | ) | (18,324 | ) | ||||
Total income from continuing operations
|
4,021 | 61,976 | ||||||
Margin:
|
||||||||
Marketing and data services
|
5.6 | % | 8.6 | % | ||||
IT Infrastructure management services
|
7.7 | % | 14.6 | % | ||||
Total margin
|
0.5 | % | 7.8 | % | ||||
ACXIOM CORPORATION AND SUBSIDIARIES
|
||||||||||||||||
RECONCILIATION OF GAAP TO NON-GAAP SEGMENT RESULTS
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
(Dollars in thousands, except earnings per share)
|
||||||||||||||||
For the Three Months Ended
|
For the Nine Months Ended
|
|||||||||||||||
December 31,
|
December 31,
|
|||||||||||||||
2014
|
2013
|
2014
|
2013
|
|||||||||||||
Marketing and data services income from operations
|
13,703 | 22,529 | 33,372 | 51,256 | ||||||||||||
Unusual items:
|
||||||||||||||||
Purchased intangible asset amortization
|
3,783 | 62 | 7,667 | 272 | ||||||||||||
Non-cash stock compensation
|
7,971 | 2,685 | 18,334 | 7,927 | ||||||||||||
Marketing and data services income
|
||||||||||||||||
from operations before unusual items
|
25,457 | 25,276 | 59,373 | 59,455 | ||||||||||||
Margin
|
12.2 | % | 12.2 | % | 9.9 | % | 10.0 | % | ||||||||
IT infrastructure management services income
|
||||||||||||||||
from operations
|
3,780 | 6,316 | 12,649 | 29,044 | ||||||||||||
Unusual items:
|
||||||||||||||||
Non-cash stock compensation
|
611 | 770 | 2,204 | 2,417 | ||||||||||||
IT infrastructure management services income
|
||||||||||||||||
from operations before unusual items
|
4,391 | 7,086 | 14,853 | 31,461 | ||||||||||||
Margin
|
8.4 | % | 11.4 | % | 9.1 | % | 15.9 | % | ||||||||
ACXIOM CORPORATION AND SUBSIDIARIES
|
||||||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||
December 31,
|
March 31,
|
$ | % | |||||||||||||
2014
|
2014
|
Variance
|
Variance
|
|||||||||||||
Assets
|
||||||||||||||||
Current assets:
|
||||||||||||||||
Cash and cash equivalents
|
126,891 | 418,586 | (291,695 | ) | (69.7 | %) | ||||||||||
Trade accounts receivable, net
|
155,867 | 160,718 | (4,851 | ) | (3.0 | %) | ||||||||||
Deferred income taxes
|
15,809 | 12,870 | 2,939 | 22.8 | % | |||||||||||
Refundable income taxes
|
11,823 | 11,535 | 288 | 2.5 | % | |||||||||||
Restricted cash held in escrow
|
31,000 | - | 31,000 | 100.0 | % | |||||||||||
Other current assets
|
50,163 | 54,484 | (4,321 | ) | (7.9 | %) | ||||||||||
Assets of discontinued operations
|
478 | 7,332 | (6,854 | ) | (93.5 | %) | ||||||||||
Total current assets
|
392,031 | 665,525 | (273,494 | ) | (41.1 | %) | ||||||||||
Property and equipment
|
733,387 | 852,236 | (118,849 | ) | (13.9 | %) | ||||||||||
Less - accumulated depreciation and amortization
|
516,899 | 635,330 | (118,431 | ) | (18.6 | %) | ||||||||||
Property and equipment, net
|
216,488 | 216,906 | (418 | ) | (0.2 | %) | ||||||||||
Software, net of accumulated amortization
|
77,033 | 39,425 | 37,608 | 95.4 | % | |||||||||||
Goodwill
|
572,589 | 358,384 | 214,205 | 59.8 | % | |||||||||||
Purchased software licenses, net of accumulated amortization
|
14,555 | 18,584 | (4,029 | ) | (21.7 | %) | ||||||||||
Other assets, net
|
41,257 | 24,477 | 16,780 | 68.6 | % | |||||||||||
1,313,953 | 1,323,301 | (9,348 | ) | (0.7 | %) | |||||||||||
Liabilities and Stockholders' Equity
|
||||||||||||||||
Current liabilities:
|
||||||||||||||||
Current installments of long-term debt
|
33,269 | 28,567 | 4,702 | 16.5 | % | |||||||||||
Trade accounts payable
|
33,527 | 36,179 | (2,652 | ) | (7.3 | %) | ||||||||||
Accrued payroll and related expenses
|
35,718 | 62,182 | (26,464 | ) | (42.6 | %) | ||||||||||
Other accrued expenses
|
69,338 | 70,412 | (1,074 | ) | (1.5 | %) | ||||||||||
Acquisition escrow payable
|
31,000 | - | 31,000 | 100.0 | % | |||||||||||
Deferred revenue
|
37,944 | 47,638 | (9,694 | ) | (20.3 | %) | ||||||||||
Income taxes
|
- | 241 | (241 | ) | (100.0 | %) | ||||||||||
Liabilities of discontinued operations
|
1,548 | 4,250 | (2,702 | ) | (63.6 | %) | ||||||||||
Total current liabilities
|
242,344 | 249,469 | (7,125 | ) | (2.9 | %) | ||||||||||
Long-term debt
|
262,761 | 289,043 | (26,282 | ) | (9.1 | %) | ||||||||||
Deferred income taxes
|
103,498 | 90,226 | 13,272 | 14.7 | % | |||||||||||
Other liabilities
|
14,942 | 11,706 | 3,236 | 27.6 | % | |||||||||||
Stockholders' equity:
|
||||||||||||||||
Common stock
|
12,723 | 12,584 | 139 | 1.1 | % | |||||||||||
Additional paid-in capital
|
1,015,697 | 981,985 | 33,712 | 3.4 | % | |||||||||||
Retained earnings
|
597,837 | 602,829 | (4,992 | ) | (0.8 | %) | ||||||||||
Accumulated other comprehensive income
|
9,364 | 13,662 | (4,298 | ) | (31.5 | %) | ||||||||||
Treasury stock, at cost
|
(945,213 | ) | (928,203 | ) | (17,010 | ) | (1.8 | %) | ||||||||
Total stockholders' equity
|
690,408 | 682,857 | 7,551 | 1.1 | % | |||||||||||
1,313,953 | 1,323,301 | (9,348 | ) | (0.7 | %) | |||||||||||
ACXIOM CORPORATION AND SUBSIDIARIES
|
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||
(Unaudited)
|
||||||||
(Dollars in thousands)
|
||||||||
For the Three Months Ended
|
||||||||
December 31,
|
||||||||
2014
|
2013
|
|||||||
Cash flows from operating activities:
|
||||||||
Net earnings
|
4,156 | 15,067 | ||||||
Loss (earnings) from discontinued operations, net of tax
|
318 | (489 | ) | |||||
Non-cash operating activities:
|
||||||||
Depreciation and amortization
|
29,285 | 25,457 | ||||||
Gain on disposal or impairment of assets
|
- | (2,567 | ) | |||||
Loss on early extinguishment of debt
|
- | 664 | ||||||
Deferred income taxes
|
4,002 | (3,138 | ) | |||||
Non-cash stock compensation expense
|
8,582 | 3,455 | ||||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
(1,080 | ) | 8,806 | |||||
Other assets
|
3 | 6,925 | ||||||
Deferred costs
|
(105 | ) | (89 | ) | ||||
Accounts payable and other liabilities
|
(4,873 | ) | 7,118 | |||||
Deferred revenue
|
2,376 | 2,582 | ||||||
Net cash provided by operating activities
|
42,664 | 63,791 | ||||||
Cash flows from investing activities:
|
||||||||
Capitalized software
|
(4,408 | ) | (5,495 | ) | ||||
Capital expenditures
|
(13,132 | ) | (6,681 | ) | ||||
Data acquisition costs
|
(394 | ) | (1,786 | ) | ||||
Payments from investments
|
- | 3,633 | ||||||
Net cash provided (used) by investing activities
|
(17,934 | ) | (10,329 | ) | ||||
Cash flows from financing activities:
|
||||||||
Proceeds from debt
|
- | 300,000 | ||||||
Payments of debt
|
(8,957 | ) | (220,934 | ) | ||||
Fees for debt refinancing
|
- | (4,370 | ) | |||||
Sale of common stock, net of stock acquired for withholding taxes
|
1,680 | 50,547 | ||||||
Acquisition of treasury stock
|
- | (13,826 | ) | |||||
Acquisition of noncontrolling interest
|
- | (600 | ) | |||||
Net cash provided (used) by financing activities
|
(7,277 | ) | 110,817 | |||||
Cash flows from discontinued operations:
|
||||||||
From operating activities
|
140 | (19 | ) | |||||
From investing activities
|
- | (19 | ) | |||||
Net cash provided by discontinued operations
|
140 | (38 | ) | |||||
Effect of exchange rate changes on cash
|
(512 | ) | 51 | |||||
Net change in cash and cash equivalents
|
17,081 | 164,292 | ||||||
Cash and cash equivalents at beginning of period
|
109,810 | 216,616 | ||||||
Cash and cash equivalents at end of period
|
126,891 | 380,908 | ||||||
Supplemental cash flow information:
|
||||||||
Cash paid during the period for:
|
||||||||
Interest
|
809 | 3,281 | ||||||
Income taxes
|
182 | 4,766 | ||||||
Payments on capital leases and installment payment arrangements
|
930 | 1,675 | ||||||
Other debt payments, excluding line of credit
|
8,027 | 4,259 | ||||||
Prepayment of debt
|
- | 215,000 | ||||||
ACXIOM CORPORATION AND SUBSIDIARIES
|
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||
(Unaudited)
|
||||||||
(Dollars in thousands)
|
||||||||
For the Nine Months Ended
|
||||||||
December 31,
|
||||||||
2014
|
2013
|
|||||||
Cash flows from operating activities:
|
||||||||
Net earnings (loss)
|
(4,992 | ) | 38,026 | |||||
Loss (earnings) from discontinued operations, net of tax
|
1,898 | (1,507 | ) | |||||
Non-cash operating activities:
|
||||||||
Depreciation and amortization
|
84,971 | 75,698 | ||||||
Gain on disposal or impairment of assets
|
- | (2,567 | ) | |||||
Loss on early extinguishment of debt
|
- | 664 | ||||||
Deferred income taxes
|
(2,020 | ) | (3,666 | ) | ||||
Non-cash stock compensation expense
|
20,538 | 10,344 | ||||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
7,528 | 3,964 | ||||||
Other assets
|
3,483 | 6,932 | ||||||
Deferred costs
|
(1,488 | ) | (89 | ) | ||||
Accounts payable and other liabilities
|
(29,415 | ) | (11,756 | ) | ||||
Deferred revenue
|
(10,180 | ) | 6,511 | |||||
Net cash provided by operating activities
|
70,323 | 122,554 | ||||||
Cash flows from investing activities:
|
||||||||
Capitalized software
|
(14,985 | ) | (19,109 | ) | ||||
Capital expenditures
|
(51,529 | ) | (24,723 | ) | ||||
Data acquisition costs
|
(1,497 | ) | (4,660 | ) | ||||
Payments from investments
|
- | 3,633 | ||||||
Net cash paid in acquisitions
|
(265,672 | ) | - | |||||
Net cash provided (used) by investing activities
|
(333,683 | ) | (44,859 | ) | ||||
Cash flows from financing activities:
|
||||||||
Proceeds from debt
|
- | 300,000 | ||||||
Payments of debt
|
(19,815 | ) | (230,167 | ) | ||||
Fees for debt refinancing
|
- | (4,370 | ) | |||||
Sale of common stock, net of stock acquired for withholding taxes
|
(807 | ) | 69,106 | |||||
Acquisition of treasury stock
|
(9,868 | ) | (52,663 | ) | ||||
Acquisition of noncontrolling interest
|
- | (600 | ) | |||||
Net cash provided (used) by financing activities
|
(30,490 | ) | 81,306 | |||||
Cash flows from discontinued operations:
|
||||||||
From operating activities
|
209 | (1,412 | ) | |||||
From investing activities
|
2,927 | (166 | ) | |||||
Net cash provided (used) by discontinued operations
|
3,136 | (1,578 | ) | |||||
Effect of exchange rate changes on cash
|
(981 | ) | 511 | |||||
Net change in cash and cash equivalents
|
(291,695 | ) | 157,934 | |||||
Cash and cash equivalents at beginning of period
|
418,586 | 222,974 | ||||||
Cash and cash equivalents at end of period
|
126,891 | 380,908 | ||||||
Supplemental cash flow information:
|
||||||||
Cash paid during the period for:
|
||||||||
Interest
|
6,200 | 9,267 | ||||||
Income taxes
|
538 | 15,774 | ||||||
Payments on capital leases and installment payment arrangements
|
3,249 | 6,914 | ||||||
Other debt payments, excluding line of credit
|
16,566 | 8,253 | ||||||
Prepayment of debt
|
- | 215,000 | ||||||
ACXIOM CORPORATION AND SUBSIDIARIES
|
||||||||||||||
CALCULATION OF FREE CASH FLOW AVAILABLE TO EQUITY
|
||||||||||||||
AND RECONCILIATION TO OPERATING CASH FLOW
|
||||||||||||||
(Unaudited)
|
||||||||||||||
(Dollars in thousands)
|
||||||||||||||
06/30/13
|
09/30/13
|
12/31/13
|
03/31/14
|
YTD FY2014
|
06/30/14
|
09/30/14
|
12/31/14
|
YTD FY2015
|
TTM 12/31/13
|
TTM 12/31/14
|
||||
Net cash provided by operating activities - continuing operations
|
16,508
|
42,255
|
63,791
|
40,687
|
163,241
|
1,867
|
25,792
|
42,664
|
70,323
|
196,417
|
111,010
|
|||
Net cash provided by operating activities - discontinued operations
|
341
|
(1,734)
|
(19)
|
3,147
|
1,735
|
(13)
|
82
|
140
|
209
|
(1,054)
|
3,356
|
|||
Less:
|
||||||||||||||
Payments for investments
|
-
|
-
|
3,633
|
190
|
3,823
|
-
|
-
|
-
|
-
|
3,633
|
190
|
|||
Capitalized software
|
(5,954)
|
(7,660)
|
(5,495)
|
(5,408)
|
(24,517)
|
(4,969)
|
(5,608)
|
(4,408)
|
(14,985)
|
(25,798)
|
(20,393)
|
|||
Capital expenditures
|
(8,912)
|
(9,130)
|
(6,681)
|
(14,409)
|
(39,132)
|
(19,001)
|
(19,396)
|
(13,132)
|
(51,529)
|
(40,986)
|
(65,938)
|
|||
Data acquisition costs
|
(1,961)
|
(913)
|
(1,786)
|
(3,085)
|
(7,745)
|
(635)
|
(468)
|
(394)
|
(1,497)
|
(6,766)
|
(4,582)
|
|||
Discontinued operations investing activities
|
(8)
|
(139)
|
(19)
|
-
|
(166)
|
2,927
|
-
|
-
|
2,927
|
(418)
|
2,927
|
|||
Payments on capital leases and installment payment arrangements
|
(2,900)
|
(2,339)
|
(1,675)
|
(1,465)
|
(8,379)
|
(1,235)
|
(1,084)
|
(930)
|
(3,249)
|
(10,480)
|
(4,714)
|
|||
Other required debt payments
|
(1,990)
|
(2,004)
|
(4,259)
|
(4,263)
|
(12,516)
|
(4,267)
|
(4,272)
|
(8,027)
|
(16,566)
|
(11,768)
|
(20,829)
|
|||
Total
|
(4,876)
|
18,336
|
47,490
|
15,394
|
76,344
|
(25,326)
|
(4,954)
|
15,913
|
(14,367)
|
102,780
|
1,027
|
|||
CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||||||
(Unaudited)
|
||||||||||||||
(Dollars in thousands, except earnings per share)
|
||||||||||||||
Q3 FY15 to Q3 FY14
|
||||||||||||||
06/30/13
|
09/30/13
|
12/31/13
|
03/31/14
|
YTD FY2014
|
06/30/14
|
09/30/14
|
12/31/14
|
YTD FY2015
|
%
|
$
|
||||
Revenue:
|
||||||||||||||
Marketing and data services
|
187,793
|
200,952
|
206,662
|
209,746
|
805,153
|
186,683
|
204,248
|
208,246
|
599,177
|
0.8%
|
1,584
|
|||
IT Infrastructure management services
|
69,385
|
66,825
|
62,099
|
58,816
|
257,125
|
55,532
|
55,789
|
52,194
|
163,515
|
-16.0%
|
(9,905)
|
|||
Total revenue
|
257,178
|
267,777
|
268,761
|
268,562
|
1,062,278
|
242,215
|
260,037
|
260,440
|
762,692
|
-3.1%
|
(8,321)
|
|||
Operating costs and expenses:
|
||||||||||||||
Cost of revenue
|
196,105
|
199,107
|
201,430
|
198,920
|
795,562
|
192,303
|
205,318
|
203,728
|
601,349
|
1.1%
|
2,298
|
|||
Selling, general and administrative
|
37,615
|
42,859
|
43,383
|
45,519
|
169,376
|
46,938
|
50,483
|
47,345
|
144,766
|
9.1%
|
3,962
|
|||
Impairment of goodwill and other
|
-
|
-
|
-
|
24,953
|
24,953
|
-
|
-
|
-
|
0
|
-
|
-
|
|||
Gains, losses and other items, net
|
-
|
6,584
|
4,657
|
10,673
|
21,914
|
7,452
|
929
|
4,175
|
12,556
|
-10.4%
|
(482)
|
|||
Total operating costs and expenses
|
233,720
|
248,550
|
249,470
|
280,065
|
1,011,805
|
246,693
|
256,730
|
255,248
|
758,671
|
2.3%
|
5,778
|
|||
Income (loss) from operations
|
23,458
|
19,227
|
19,291
|
(11,503)
|
50,473
|
(4,478)
|
3,307
|
5,192
|
4,021
|
-73.1%
|
(14,099)
|
|||
% Margin
|
9.1%
|
7.2%
|
7.2%
|
-4.3%
|
4.8%
|
-1.8%
|
1.3%
|
2.0%
|
0.5%
|
|||||
Other expense
|
||||||||||||||
Interest expense
|
(3,019)
|
(2,980)
|
(3,114)
|
(2,558)
|
(11,671)
|
(2,571)
|
(2,395)
|
(2,610)
|
(7,576)
|
16.2%
|
504
|
|||
Other, net
|
104
|
(350)
|
1,484
|
579
|
1,817
|
(413)
|
(115)
|
(34)
|
(562)
|
-102.3%
|
(1,518)
|
|||
Total other expense
|
(2,915)
|
(3,330)
|
(1,630)
|
(1,979)
|
(9,854)
|
(2,984)
|
(2,510)
|
(2,644)
|
(8,138)
|
62.2%
|
(1,014)
|
|||
Earnings (loss) from continuing operations before income taxes
|
20,543
|
15,897
|
17,661
|
(13,482)
|
40,619
|
(7,462)
|
797
|
2,548
|
(4,117)
|
-85.6%
|
(15,113)
|
|||
Income taxes
|
8,040
|
6,459
|
3,083
|
12,045
|
29,627
|
(1,390)
|
2,293
|
(1,926)
|
(1,023)
|
-162.5%
|
(5,009)
|
|||
Net earnings (loss) from continuing operations
|
12,503
|
9,438
|
14,578
|
(25,527)
|
10,992
|
(6,072)
|
(1,496)
|
4,474
|
(3,094)
|
-69.3%
|
(10,104)
|
|||
Earnings (loss) from discontinued operations, net of tax
|
592
|
426
|
489
|
(3,696)
|
(2,189)
|
(1,532)
|
(48)
|
(318)
|
(1,898)
|
-165.0%
|
(807)
|
|||
Net earnings (loss)
|
13,095
|
9,864
|
15,067
|
(29,223)
|
8,803
|
(7,604)
|
(1,544)
|
4,156
|
(4,992)
|
-72.4%
|
(10,911)
|
|||
Less: Net gain (loss) attributable
|
||||||||||||||
to noncontrolling interest
|
(85)
|
25
|
-
|
-
|
(60)
|
-
|
-
|
-
|
-
|
-
|
-
|
|||
Net earnings (loss) attributable to Acxiom
|
13,180
|
9,839
|
15,067
|
(29,223)
|
8,863
|
(7,604)
|
(1,544)
|
4,156
|
(4,992)
|
-72.4%
|
(10,911)
|
|||
Diluted earnings (loss) per share - net earnings (loss) attributable
|
||||||||||||||
to Acxiom stockholders
|
0.17
|
0.13
|
0.19
|
(0.38)
|
0.12
|
(0.10)
|
(0.02)
|
0.05
|
(0.06)
|
-73.7%
|
(0.14)
|
|||
ACXIOM CORPORATION AND SUBSIDIARIES
|
||||||||||||||||||||||||||||||||||||||||||||||||
RESULTS BY SEGMENT
|
||||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited)
|
||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands)
|
||||||||||||||||||||||||||||||||||||||||||||||||
Q3 FY15 to Q3 FY14
|
||||||||||||||||||||||||||||||||||||||||||||||||
06/30/13
|
09/30/13
|
12/31/13
|
03/31/14
|
YTD FY2014
|
06/30/14
|
09/30/14
|
12/31/14
|
YTD FY2015
|
%
|
$ | ||||||||||||||||||||||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||||||||||||||||||||||||||
Marketing and data services
|
187,793 | 200,952 | 206,662 | 209,746 | 805,153 | 186,683 | 204,248 | 208,246 | 599,177 | 1 | % | 1,584 | ||||||||||||||||||||||||||||||||||||
IT Infrastructure management services
|
69,385 | 66,825 | 62,099 | 58,816 | 257,125 | 55,532 | 55,789 | 52,194 | 163,515 | -16 | % | (9,905 | ) | |||||||||||||||||||||||||||||||||||
Total revenue
|
257,178 | 267,777 | 268,761 | 268,562 | 1,062,278 | 242,215 | 260,037 | 260,440 | 762,692 | -3 | % | (8,321 | ) | |||||||||||||||||||||||||||||||||||
Income from continuing operations:
|
||||||||||||||||||||||||||||||||||||||||||||||||
Marketing and data services
|
12,697 | 16,030 | 22,529 | 27,244 | 78,500 | 10,272 | 9,397 | 13,703 | 33,372 | -39 | % | (8,826 | ) | |||||||||||||||||||||||||||||||||||
IT Infrastructure management services
|
10,761 | 11,967 | 6,316 | 3,803 | 32,847 | 4,739 | 4,130 | 3,780 | 12,649 | -40 | % | (2,536 | ) | |||||||||||||||||||||||||||||||||||
Corporate
|
- | (8,770 | ) | (9,554 | ) | (42,550 | ) | (60,874 | ) | (19,489 | ) | (10,220 | ) | (12,291 | ) | (42,000 | ) | -29 | % | (2,737 | ) | |||||||||||||||||||||||||||
Total income (loss) from continuing operations
|
23,458 | 19,227 | 19,291 | (11,503 | ) | 50,473 | (4,478 | ) | 3,307 | 5,192 | 4,021 | -73 | % | (14,099 | ) | |||||||||||||||||||||||||||||||||
Margin:
|
||||||||||||||||||||||||||||||||||||||||||||||||
Marketing and data services
|
6.8 | % | 8.0 | % | 10.9 | % | 13.0 | % | 9.7 | % | 5.5 | % | 4.6 | % | 6.6 | % | 5.6 | % | ||||||||||||||||||||||||||||||
IT Infrastructure management services
|
15.5 | % | 17.9 | % | 10.2 | % | 6.5 | % | 12.8 | % | 8.5 | % | 7.4 | % | 7.2 | % | 7.7 | % | ||||||||||||||||||||||||||||||
Total
|
9.1 | % | 7.2 | % | 7.2 | % | -4.3 | % | 4.8 | % | -1.8 | % | 1.3 | % | 2.0 | % | 0.5 | % | ||||||||||||||||||||||||||||||