EX-99.1 2 d628225dex991.htm EX-99.1 EX-99.1

EXHIBIT 99.1

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

The unaudited pro forma condensed consolidated financial information shown below is based on historical consolidated financial statements of the Registrant. The accompanying unaudited pro forma condensed consolidated balance sheet as of June 30, 2018 presents the Registrant’s historical consolidated statement of financial position, giving effect to the disposition as if it had been completed on June 30, 2018. The accompanying unaudited pro forma condensed consolidated statements of operations for the three months ended June 30, 2018 and for the years ended March 31, 2018, 2017 and 2016 present the Registrant’s historical consolidated statements of operations, giving effect to the disposition as if it had been completed on April 1, 2015, the beginning of the earliest period presented.

The unaudited pro forma condensed consolidated financial statements include specific, factually supportable assumptions and adjustments that are directly related to the disposition. These pro forma adjustments have been made to illustrate the anticipated financial effect of the disposition on the Registrant. The adjustments are based upon available information and assumptions that the Registrant believes are reasonable as of the date of this filing. However, actual adjustments may differ materially from the information presented. Assumptions underlying the pro forma adjustments are described in the accompanying notes, which should be read in conjunction with the unaudited pro forma condensed consolidated financial information. The unaudited pro forma condensed consolidated financial statements, including notes thereto, should be read in conjunction with the historical financial statements and notes thereto of the Registrant included in the Registrant’s Quarterly Report on Form 10-Q for the three months ended June 30, 2018, and the Registrant’s Annual Report on Form 10-K for the year ended March 31, 2018.

Acxiom Corporation

Unaudited Pro Forma Condensed Consolidated Balance Sheet

As of June 30, 2018

 

(in thousands)

    Historical
Acxiom		     AMS
Adjustment
(Note A)		     Other
Pro Forma
Adjustments		    

Note
Reference

    Pro Forma
Consolidated		  

ASSETS

            

Current assets:

            

Cash and cash equivalents

    $ 95,099     $ (1,544 )    $ 2,044,498     (B)    $ 2,138,053  

Trade accounts receivable, net

      163,767       (110,331 )      —            53,436  

Refundable income taxes

      11,761       (11,789 )      28     (D)      —    

Other current assets

      40,167       (19,689 )      —            20,478  
  

 

 

    

 

 

    

 

 

       

 

 

  

Total current assets

      310,794       (143,353 )      2,044,526          2,190,107  

Property and equipment, net of accumulated

depreciation and amortization

      151,407       (121,288 )      —            30,119  

Software, net

      31,719       (20,983 )      —            10,736  

Goodwill

      595,795       (390,841 )      —            204,954  

Purchased software licenses, net

      6,670       (6,492 )      —            178  

Deferred income taxes

      11,488       76,443       (87,903 )    (D)      28  

Deferred commissions, net

      18,137       (10,696 )      —            7,441  

Other assets, net

      40,958       (2,246 )      —            38,712  
  

 

 

    

 

 

    

 

 

       

 

 

  
   $ 1,166,968     $ (619,456 )    $ 1,956,623        $ 2,504,135  
  

 

 

    

 

 

    

 

 

       

 

 

  

LIABILITIES AND EQUITY

            

Current liabilities:

            

Current installments of long-term debt

    $ 1,327     $ —       $ (1,327 )    (B)    $ —    

Trade accounts payable

      47,668       (23,713 )      —            23,955  

Accrued payroll and related expenses

      21,939       (11,576 )      —            10,363  

Other accrued expenses

      58,938       (13,498 )      —            45,440  

Deferred revenue

      31,621       (26,710 )      —            4,911  

Income taxes payable

      —         —         495,900     (D)      495,928  
         28     (D)   
  

 

 

    

 

 

    

 

 

       

 

 

  

Total current liabilities

      161,493       (75,497 )      494,601          580,597  
  

 

 

    

 

 

    

 

 

       

 

 

  

Long term debt

      227,435       —         (227,435 )    (B)      —    

Deferred income taxes

      42,258       (42,258 )      —            —    

Other liabilities

      13,726       (4,563 )      —            9,163  

Commitments and contingencies

            

Equity:

            

Common stock

      13,773       —         —            13,773  

Additional paid-in capital

      1,256,442       —         —            1,256,442  

Retained earnings

      638,043       (500,662 )      500,662     (B)      1,826,838  
         1,772,598     (C)   
         (583,803 )    (D)   

Accumulated other comprehensive income

      8,899       3,524       —            12,423  

Treasury stock, at cost

      (1,195,101 )      —         —            (1,195,101 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Total equity

      722,056       (497,138 )      1,689,457          1,914,375  
  

 

 

    

 

 

    

 

 

       

 

 

  
   $ 1,166,968     $ (619,456 )    $ 1,956,623        $ 2,504,135  
  

 

 

    

 

 

    

 

 

       

 

 

  

See accompanying Notes to Pro Forma Financial Information

Acxiom Corporation

Unaudited Pro Forma Condensed Consolidated Statement of Operations

For the Three Months Ended June 30, 2018

 

(in thousands, except per share amounts)

    Historical
Acxiom		     AMS
Adjustment
(Note A)		     Other
Pro Forma
Adjustments		    

Note
Reference

    Pro Forma
Consolidated		  

Revenues

    $ 226,960     $ (164,489 )    $ —          $ 62,471  

Cost of revenue

      117,271       (93,617 )      —            23,654  
  

 

 

    

 

 

    

 

 

       

 

 

  

Gross profit

      109,689       (70,872 )      —            38,817  

Operating expenses:

            

Research and development

      24,536       (7,566 )      —            16,970  

Sales and marketing

      54,850       (21,527 )      —            33,323  

General and administrative

      34,718       (16,594 )      —            18,124  

Gains, losses, and other items, net

      1,286       (1,284 )      —            2  
  

 

 

    

 

 

    

 

 

       

 

 

  

Total operating expenses

      115,390       (46,971 )      —            68,419  
  

 

 

    

 

 

    

 

 

       

 

 

  

Income (loss) from operations

      (5,701 )      (23,901 )      —            (29,602 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Other income (expense):

            

Interest expense

      (2,838 )      —         2,835     (C)      (3 ) 

Other, net

      524       (168 )      —            356  
  

 

 

    

 

 

    

 

 

       

 

 

  

Total other expense

      (2,314 )      (168 )      2,835          353  
  

 

 

    

 

 

    

 

 

       

 

 

  

Income (loss) from operations before income taxes

      (8,015 )      (24,069 )      2,835          (29,249 ) 

Income tax expense (benefit)

      (5,000 )      (6,092 )      11,159     (B)      67  
  

 

 

    

 

 

    

 

 

       

 

 

  

Net earnings (loss)

    $ (3,015 )    $ (17,977 )    $ (8,324 )       $ (29,316 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Basic loss per share

    $ (0.04 )           $ (0.38 ) 

Diluted loss per share

    $ (0.04 )           $ (0.38 ) 

Basic shares used in the calculation of net loss per share

      76,935              76,935  

Diluted shares used in the calculation of net loss per share

      76,935              76,935  

See accompanying Notes to Pro Forma Financial Information

Acxiom Corporation

Unaudited Pro Forma Condensed Consolidated Statement of Operations

For the Fiscal Year Ended March 31, 2018

 

(in thousands, except per share amounts)

    Historical
Acxiom		     AMS
Adjustment
(Note A)		     Other
Pro Forma
Adjustments		    

Note
Reference

    Pro Forma
Consolidated		  

Revenues

    $ 917,406     $ (697,305 )    $ —          $ 220,101  

Cost of revenue

      466,436       (370,040 )      —            96,396  
  

 

 

    

 

 

    

 

 

       

 

 

  

Gross profit

      450,970       (327,265 )      —            123,705  

Operating expenses:

            

Research and development

      94,873       (34,168 )      —            60,713  

Sales and marketing

      215,599       (106,960 )      —            108,639  

General and administrative

      123,526       (38,372 )      —            85,154  

Gains, losses, and other items, net

      6,373       (3,650 )      —            2,723  
  

 

 

    

 

 

    

 

 

       

 

 

  

Total operating expenses

      440,371       (183,142 )      —            257,229  
  

 

 

    

 

 

    

 

 

       

 

 

  

Income (loss) from operations

      10,599       (144,123 )      —            (133,524 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Other income (expense):

            

Interest expense

      (10,131 )      —         10,105     (C)      (26 ) 

Other, net

      241       287       —          528  
  

 

 

    

 

 

    

 

 

       

 

 

  

Total other expense

      (9,890 )      287       10,105          502  
  

 

 

    

 

 

    

 

 

       

 

 

  

Income (loss) from operations before income taxes

      709       (143,836 )      10,105          (133,022 ) 

Income tax expense (benefit)

      (22,771 )      25,414       2,525     (B)      118  
  

 

 

    

 

 

    

 

 

       

 

 

  

Net earnings (loss)

    $ 23,480     $ (169,250 )    $ (12,630 )       $ (133,140 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Basic earnings (loss) per share

    $ 0.30            $ (1.69 ) 

Diluted earnings (loss) per share

    $ 0.29            $ (1.69 ) 

Basic shares used in the calculation of net earnings (loss) per share

      78,891              78,891  

Diluted shares used in the calculation of net earnings (loss) per share

      81,516              78,891  

See accompanying Notes to Pro Forma Financial Information

Acxiom Corporation

Unaudited Pro Forma Condensed Consolidated Statement of Operations

For the Fiscal Year Ended March 31, 2017

 

(in thousands, except per share amounts)

    Historical
Acxiom		     AMS
Adjustment
(Note A)		     Other
Pro Forma
Adjustments		    

Note
Reference

    Pro Forma
Consolidated		  

Revenues

    $ 880,247     $ (705,487 )    $ —          $ 174,760  

Cost of revenue

      477,686       (377,710 )      —            99,976  
  

 

 

    

 

 

    

 

 

       

 

 

  

Gross profit

      402,561       (327,777 )      —            74,784  

Operating expenses:

            

Research and development

      82,109       (32,742 )      —            49,367  

Sales and marketing

      166,676       (107,418 )      —            59,258  

General and administrative

      129,714       (36,815 )      —            92,899  

Gains, losses, and other items, net

      8,373       (3,700 )      —            4,673  
  

 

 

    

 

 

    

 

 

       

 

 

  

Total operating expenses

      386,872       (180,675 )      —            206,197  
  

 

 

    

 

 

    

 

 

       

 

 

  

Income (loss) from operations

      15,689       (147,102 )      —            (131,413 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Other income (expense):

            

Interest expense

      (7,381 )      —         7,320     (C)      (61 ) 

Other, net

      334       378       —            712  
  

 

 

    

 

 

    

 

 

       

 

 

  

Total other expense

      (7,047 )      378       7,320          651  
  

 

 

    

 

 

    

 

 

       

 

 

  

Income (loss) from operations before income taxes

      8,642       (146,724 )      7,320          (130,762 ) 

Income tax expense (benefit)

      4,534       (47,937 )      43,591     (B)      188  
  

 

 

    

 

 

    

 

 

       

 

 

  

Net earnings (loss)

    $ 4,108     $ (98,787 )    $ (36,271 )       $ (130,950 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Basic earnings (loss) per share

    $ 0.05            $ (1.69 ) 

Diluted earnings (loss) per share

    $ 0.05            $ (1.69 ) 

Basic shares used in the calculation of net earnings (loss) per share

      77,609              77,609  

Diluted shares used in the calculation of net earnings (loss) per share

      79,848              77,609  

See accompanying Notes to Pro Forma Financial Information

Acxiom Corporation

Unaudited Pro Forma Condensed Consolidated Statement of Operations

For the Fiscal Year Ended March 31, 2016

 

(in thousands, except per share amounts)

    Historical
Acxiom		     AMS
Adjustment
(Note A)		     Other
Pro Forma
Adjustments		    

Note
Reference

    Pro Forma
Consolidated		  

Revenues

    $ 850,088     $ (683,537 )    $ —          $ 166,551  

Cost of revenue

      488,382       (383,706 )      —            104,676  
  

 

 

    

 

 

    

 

 

       

 

 

  

Gross profit

      361,706       (299,831 )      —            61,875  

Operating expenses:

            

Research and development

      74,247       (36,108 )      —            38,139  

Sales and marketing

      146,176       (107,454 )      —            38,722  

General and administrative

      135,385       (30,141 )      —            105,244  

Impairment of goodwill and other assets

      6,829       (6,829 )      —            —    

Gains, losses, and other items, net

      12,132       (10,541 )      —            1,591  
  

 

 

    

 

 

    

 

 

       

 

 

  

Total operating expenses

      374,769       (191,073 )      —            183,696  
  

 

 

    

 

 

    

 

 

       

 

 

  

Loss from operations

      (13,063 )      (108,758 )      —            (121,821 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Other income (expense):

            

Interest expense

      (7,669 )      —         7,575     (C)      (94 ) 

Other, net

      452       (900 )      —            (448 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Total other expense

      (7,217 )      (900 )      7,575          (542 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Loss from continuing operations before income taxes

      (20,280 )      (109,658 )      7,575          (122,363 ) 

Income tax expense (benefit)

      (11,632 )      (32,323 )      44,166     (B)      231  
  

 

 

    

 

 

    

 

 

       

 

 

  

Net loss from continuing operations

    $ (8,648 )    $ (77,355 )    $ (36,591 )       $ (122,594 ) 
  

 

 

    

 

 

    

 

 

       

 

 

  

Basic loss per share from continuing operations

    $ (0.11 )           $ (1.58 ) 

Diluted loss per share from continuing operations

    $ (0.11 )           $ (1.58 ) 

Basic shares used in the calculation of net loss per share

      77,616              77,616  

Diluted shares used in the calculation of net loss per share

      77,616              77,616  

See accompanying Notes to Pro Forma Financial Information

Acxiom Corporation

Notes to Unaudited Pro Forma Condensed Consolidated Financial Information

As of June 30, 2018 and For the Three Months Ended June 30, 2018 and For the Fiscal Years Ended March 31, 2018, 2017 and 2016

Pro Forma Adjustments to the Condensed Consolidated Balance Sheet as of June 30, 2018

 

  (A)

To eliminate the assets and liabilities to be sold in the disposition of AMS.

 

  (B)

To record net cash proceeds of $2.0 billion received from the disposition of AMS, representing cash proceeds of $2.3 billion stated sales price less closing adjustments of $26.7 million, net of $228.9 million which was used to repay outstanding indebtedness, and to eliminate AMS equity.

 

  (C)

To record the net gain on the disposition of AMS.

 

  (D)

To accrue the estimated tax impact associated with the gain on the disposition of AMS, to reflect the valuation allowance for LiveRamp’s deferred tax assets, and to reclass income tax balances.

Pro Forma Adjustments to the Condensed Consolidated Statements of Operations for the Three Months Ended June 30, 2018 and for the Fiscal Years Ended March 31, 2018, 2017 and 2016

 

  (A)

To eliminate the revenues and direct expenses in the disposition of AMS.

 

  (B)

To reflect the valuation allowance for LiveRamp’s deferred tax assets.

 

  (C)

To eliminate interest expense related to repayment of outstanding indebtedness.

Other

At April 1, 2018, the Registrant adopted ASU 2014-09, Revenue from Contracts with Customers (“Topic 606”) using the modified retrospective method through an increase in retained earnings of approximately $12.7 million. The cumulative adjustment primarily related to the capitalization of costs of obtaining customer contracts.

The impact of Topic 606 and related disclosures was reflected beginning in the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2018.