ACXM Acxiom Holdngs (delisted)

Acxiom® Corporation (Nasdaq: ACXM), a global leader in interactive marketing, today announced financial results for the third quarter of fiscal year 2010 ended December 31, 2009. Acxiom will hold a conference call at 10:00 a.m. CST 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.

John Meyer, Acxiom’s chief executive officer and president, said, “We stated last quarter that we expected operating income performance in the second half of the year to improve over the first half. Based on our third-quarter performance and historical seasonality patterns for fourth-quarter performance, we still expect to see significant improvement in operating income in the second half of the fiscal year.”

Meyer continued, “Despite another challenging period for us versus the prior-year quarter, we have seen a stabilization in client spending which, combined with aggressive sales initiatives, has led to increased sequential revenue for the second consecutive quarter. Our continued focus on cost management positively impacted both our operating income and operating margins. These initiatives, aided by management of our working capital, contributed to another strong quarter of operating cash flow.”

Third Quarter 2010 Highlights:

• Earnings per diluted share of $0.18 in the third quarter of fiscal 2010, compared to loss per diluted share of $0.15 in the third quarter of fiscal 2009. The prior year results included $0.36 in unusual items. Excluding the effect of the unusual items, diluted earnings per share in the prior-year period were $0.21.
• Income from operations of $29.9 million in the current-year third quarter, compared to loss from operations of $8.6 million in the third quarter last year. The prior-year loss from operations included $43.2 million in unusual loss items. Before the effect of the unusual loss items income from operations for the prior-year third quarter would have been $34.6 million.
• Revenue of $283.8 million in the current quarter, compared to $301.0 million, excluding an Information Products pass-through contract (approximately $20.1 million), in the third quarter a year ago. GAAP revenue, including the pass-through revenue in the prior quarter, was $321.1 million. This contract was modified in the fourth quarter of fiscal 2009, and the company no longer recognizes pass-through revenue from this contract.
• Operating cash flow of $74.5 million compared to $78.9 million in the third quarter a year ago.
• Free cash flow available to equity of $49.0 million, compared to $46.8 million in the third 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 was $218.3 million, compared to $231.1 million in the third quarter of the previous year. Income from operations for the quarter was $27.6 million, compared to $30.4 million in the third quarter of fiscal 2009.
• Information Products: Revenue for the quarter was $65.5 million, compared with $69.9 million, excluding the pass-through revenue of approximately $20.1 million from the Information Products contract referenced above, in the third quarter a year ago. GAAP revenue, including the pass-through revenue in the prior quarter, was $90.0 million. This contract was modified in the fourth quarter of fiscal 2009, and the company no longer recognizes pass-through revenue from this contract. Income from operations for the quarter was $2.8 million, compared to income from operations of $4.2 million in the third quarter of the previous year.

Income from operations includes expenses that had previously been included in corporate and other expenses. The Company now allocates selling, general and administrative expenses previously included in corporate and other expenses to the two operating segments, Information Services and Information Products. Prior-year results have been reclassified to reflect the change.

Fiscal Year 2010 Year-To-Date Highlights:

• Earnings per diluted share of $0.35 for the current year nine-month period compared to earnings per diluted share of $0.19 in the comparable nine-month period last year. Excluding unusual loss items of $0.33, diluted earnings per share for the nine-month period of fiscal 2009 were $0.52.
• Income from operations of $63.6 million for the first nine months of fiscal year 2010, compared to $51.3 million in the comparable nine-month period of fiscal 2009. Income from operations for the prior year, excluding unusual loss items of $40.3 million, was $91.5 million.
• Revenue of $810.9 million in the current nine-month period, compared to $917.2 million, excluding revenue from an Information Products pass-through contract of approximately $63.8 million in the prior year. GAAP revenue, including the pass-through revenues in the prior year, was $981.1 million. This contract was modified in the fourth quarter of fiscal 2009, and the company no longer recognizes pass-through revenue from this contract.
• Operating cash flow of $151.4 million in the current fiscal year nine-month period compared to $194.2 million in the prior year nine-month period.
• Free cash flow available to equity of $65.2 million for the nine months ended December 31, 2009. For the nine-month period ended December 31, 2008 free cash flow available to equity was $108.7 million, including unusual and one-time items of $26.8 million, including $24.2 million in proceeds received from the sale of company-owned real estate. Free cash flow available to equity is a non-GAAP financial measure; reconciliation to the comparable GAAP measure, operating cash flow, is attached to this news release.

Web Link to Financials

You may link to http://www.acxiom.com/FY10_Q3_Financials for the detailed financial information we typically attach to our earnings releases.

About Acxiom

A global leader in interactive marketing services and infrastructure management, Acxiom connects clients with their customers through deep customer insight, powering effective and profitable marketing initiatives and business decisions. Our consultative approach spans multiple industries and incorporates decades of experience in consumer data and analytics, information technology, data integration and consulting solutions for effective marketing across digital, Internet, email, mobile and direct mail channels. Our secure, high-performance technology services deliver consistent value and reliability. Founded in 1969, Acxiom is headquartered in Little Rock, Ark., and serves clients around the world from locations in the United States, Europe, Middle East and Asia-Pacific. For more information about Acxiom, visit www.acxiom.com.

Forward Looking Statements

This release and today’s conference call may contain forward-looking statements including, without limitation, statements regarding the anticipated improvements in operating income in the second half of our fiscal year. 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, 2009, which was filed with the Securities and Exchange Commission on May 29, 2009.

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.

  ACXIOM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Dollars in thousands, except earnings per share)       For the Three Months Ended December 31,         $     % 2009 2008 Variance Variance   Revenue: Services 218,340 231,077 (12,737 ) (5.5 %) Products 65,467   89,979   (24,512 ) (27.2 %) Total revenue 283,807 321,056 (37,249 ) (11.6 %)   Operating costs and expenses: Cost of revenue Services 163,206 173,433 10,227 5.9 % Products 46,727   70,487   23,760 33.7 % Total cost of revenue 209,933 243,920 33,987 13.9 %   Services gross margin 25.3 % 24.9 % Products gross margin 28.6 % 21.7 % Total gross margin 26.0 % 24.0 %   Selling, general and administrative 43,477 42,560 (917 ) (2.2 %) Gains, losses and other items, net 538   43,175   42,637 98.8 %   Total operating costs and expenses 253,948   329,655   75,707 23.0 %   Income from operations 29,859   (8,599 ) 38,458 447.2 %   Other income (expense): Interest expense (5,687 ) (8,105 ) 2,418 29.8 % Other, net 198   140   58 41.4 %   Total other income (expense) (5,489 ) (7,965 ) 2,476 31.1 %   Earnings (loss) before income taxes 24,370 (16,564 ) 40,934 247.1 %   Income taxes 10,212   (5,115 ) (15,327 ) (299.6 %)   Net earnings (loss) 14,158 (11,449 ) 25,607 223.7 %   Less: Net earnings (loss) attributable to noncontrolling interest (104 ) -   (104 ) -   Net earnings (loss) attributable to Acxiom 14,262   (11,449 ) 25,711 224.6 %   Earnings (loss) per share:   Basic 0.18   (0.15 ) 0.33 220.0 %   Diluted 0.18   (0.15 ) 0.33 220.0 %   Earnings (loss) per share attributable to Acxiom stockholders:   Basic 0.18   (0.15 ) 0.33 220.0 %   Diluted 0.18   (0.15 ) 0.33 220.0 %   ACXIOM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Dollars in thousands, except earnings per share)       For the Nine Months Ended December 31,         $     % 2009 2008 Variance Variance   Revenue: Services 627,879 701,377 (73,498 ) (10.5 %) Products 183,014   279,687   (96,673 ) (34.6 %) Total revenue 810,893 981,064 (170,171 ) (17.3 %)   Operating costs and expenses: Cost of revenue Services 488,574 533,280 44,706 8.4 % Products 138,775   225,242   86,467 38.4 % Total cost of revenue 627,349 758,522 131,173 17.3 %   Services gross margin 22.2 % 24.0 % Products gross margin 24.2 % 19.5 % Total gross margin 22.6 % 22.7 %   Selling, general and administrative 119,084 131,030 11,946 9.1 % Gains, losses and other items, net 858   40,260   39,402 97.9 %   Total operating costs and expenses 747,291   929,812   182,521 19.6 %   Income from operations 63,602   51,252   12,350 24.1 %   Other income (expense): Interest expense (16,615 ) (26,155 ) 9,540 36.5 % Other, net 303   1,786   (1,483 ) (83.0 %)   Total other income (expense) (16,312 ) (24,369 ) 8,057 33.1 %   Earnings before income taxes 47,290 26,883 20,407 75.9 %   Income taxes 19,493   11,829   (7,664 ) (64.8 %)   Net earnings 27,797 15,054 12,743 84.6 %   Less: Net earnings attributable to noncontrolling interest (104 ) -   (104 ) -   Net earnings attributable to Acxiom 27,901   15,054   12,847 85.3 %   Earnings per share:   Basic 0.35   0.19   0.16 84.2 %   Diluted 0.35   0.19   0.16 84.2 %   Earnings per share attributable to Acxiom stockholders:   Basic 0.35   0.19   0.16 84.2 %   Diluted 0.35   0.19   0.16 84.2 %   ACXIOM CORPORATION AND SUBSIDIARIES CALCULATION OF EARNINGS PER SHARE (Unaudited) (In thousands, except earnings per share)         For the Three Months Ended   December 31, December 31, 2009 2008   Basic earnings per share:   Numerator - net earnings (loss) 14,158 (11,449 )   Denominator - weighted-average shares outstanding 79,068 78,086     Basic earnings (loss) per share 0.18 (0.15 )   Diluted earnings per share:   Numerator - net earnings (loss) 14,158 (11,449 )   Denominator - weighted-average shares outstanding 79,068 78,086   Dilutive effect of common stock options, warrants and restricted stock 802 -     79,870 78,086     Diluted earnings (loss) per share 0.18 (0.15 )           Basic earnings per share attributable to Acxiom stockholders:   Numerator - net earnings (loss) attributable to Acxiom 14,262 (11,449 )   Denominator - weighted-average shares outstanding 79,068 78,086     Basic earnings (loss) per share attributable to Acxiom stockholders 0.18 (0.15 )   Diluted earnings per share attributable to Acxiom stockholders:   Numerator - net earnings (loss) attributable to Acxiom 14,262 (11,449 )   Denominator - weighted-average shares outstanding 79,068 78,086   Dilutive effect of common stock options, warrants and restricted stock 802 -     79,870 78,086     Diluted earnings (loss) per share attributable to Acxiom stockholders 0.18 (0.15 )   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, 2009 2008   Basic earnings per share:   Numerator - net earnings 27,797 15,054   Denominator - weighted-average shares outstanding 78,883 77,735   Basic earnings per share 0.35 0.19   Diluted earnings per share:   Numerator - net earnings 27,797 15,054   Denominator - weighted-average shares outstanding 78,883 77,735   Dilutive effect of common stock options, warrants and restricted stock 537 345   79,420 78,080   Diluted earnings per share 0.35 0.19           Basic earnings per share attributable to Acxiom stockholders:   Numerator - net earnings attributable to Acxiom 27,901 15,054   Denominator - weighted-average shares outstanding 78,883 77,735   Basic earnings per share attributable to Acxiom stockholders 0.35 0.19   Diluted earnings per share attributable to Acxiom stockholders:   Numerator - net earnings attributable to Acxiom 27,901 15,054   Denominator - weighted-average shares outstanding 78,883 77,735   Dilutive effect of common stock options, warrants and restricted stock 537 345   79,420 78,080   Diluted earnings per share attributable to Acxiom stockholders 0.35 0.19         ACXIOM CORPORATION AND SUBSIDIARIES RESULTS BY SEGMENT (Unaudited) (Dollars in thousands)   For the Three Months Ended   December 31, December 31, Revenue: 2009 2008   Information services 218,340 231,077 Information products 65,467   89,979     Total revenue 283,807   321,056       Income from operations:   Information services 27,565 30,358 Information products 2,832 4,218 Other (538 ) (43,175 )   Total income from operations 29,859   (8,599 )   Margin:   Information services 12.6 % 13.1 % Information products 4.3 % 4.7 %   Total margin 10.5 % -2.7 %         ACXIOM CORPORATION AND SUBSIDIARIES RESULTS BY SEGMENT (Unaudited) (Dollars in thousands)   For the Nine Months Ended   December 31, December 31, Revenue: 2009 2008   Information services 627,879 701,377 Information products 183,014   279,687     Total revenue 810,893   981,064       Income from operations:   Information services 63,374 84,524 Information products 1,086 6,988 Other (858 ) (40,260 )   Total income from operations 63,602   51,252     Margin:   Information services 10.1 % 12.1 % Information products 0.6 % 2.5 %   Total margin 7.8 % 5.2 %                 ACXIOM CORPORATION AND SUBSIDIARIES PRODUCTS REVENUE AND COST OF PRODUCTS SUPPLEMENTAL SCHEDULE (Unaudited) (Dollars in thousands)   For the Three Months Ended   December 31, December 31, $ % 2009 2008 Variance Variance   Products 65,467 69,892 (4,425 ) (6.3 %) Passthrough data -   20,087   (20,087 ) (100.0 %)   Total products revenue 65,467   89,979   (24,512 ) (27.2 %)     Cost of products revenue: Products 46,727 50,400 3,673 7.3 % Passthrough data -   20,087   20,087 100.0 %   Total cost of products 46,727   70,487   23,760 33.7 %   Margin:   Products 28.6 % 27.9 % Passthrough data - 0.0 % Total products 28.6 % 21.7 %                 ACXIOM CORPORATION AND SUBSIDIARIES PRODUCTS REVENUE AND COST OF PRODUCTS SUPPLEMENTAL SCHEDULE (Unaudited) (Dollars in thousands)   For the Nine Months Ended   December 31, December 31, $ % 2009 2008 Variance Variance   Products 183,014 215,838 (32,824 ) (15.2 %) Passthrough data -   63,849   (63,849 ) (100.0 %)   Total products revenue 183,014   279,687   (96,673 ) (34.6 %)     Cost of products revenue: Products 138,775 161,393 22,618 14.0 % Passthrough data -   63,849   63,849 100.0 %   Total cost of products 138,775   225,242   86,467 38.4 %   Margin:   Products 24.2 % 25.2 % Passthrough data - 0.0 % Total products 24.2 % 19.5 %                 ACXIOM CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Dollars in thousands)   December 31, March 31, $ % 2009 2009 Variance Variance

Assets

Current assets: Cash and cash equivalents 200,582 177,166 23,416 13.2 % Trade accounts receivable, net 180,546 184,814 (4,268 ) (2.3 %) Refundable income taxes - 4,579 (4,579 ) (100.0 %) Deferred income taxes 45,481 45,641 (160 ) (0.4 %) Other current assets 46,042   46,873   (831 ) (1.8 %)   Total current assets 472,651   459,073   13,578 3.0 %   Property and equipment 797,029 745,999 51,030 6.8 % Less - accumulated depreciation and amortization 576,050   531,410   44,640 8.4 %   Property and equipment, net 220,979   214,589   6,390 3.0 %   Software, net of accumulated amortization 43,077 52,798 (9,721 ) (18.4 %) Goodwill 474,597 454,944 19,653 4.3 % Purchased software licenses, net of accumulated amortization 51,499 65,341 (13,842 ) (21.2 %) Deferred costs, net 71,512 70,343 1,169 1.7 % Data acquisition costs 24,871 31,317 (6,446 ) (20.6 %) Other assets, net 18,366   18,938   (572 ) (3.0 %)   1,377,552   1,367,343   10,209 0.7 %  

Liabilities and Stockholders' Equity

Current liabilities: Current installments of long-term debt 41,485 40,967 518 1.3 % Trade accounts payable 23,575 27,701 (4,126 ) (14.9 %) Accrued payroll and related expenses 28,105 44,823 (16,718 ) (37.3 %) Other accrued expenses 85,769 86,072 (303 ) (0.4 %) Deferred revenue 57,426 54,991 2,435 4.4 % Income taxes 121   -   121 -   Total current liabilities 236,481   254,554   (18,073 ) (7.1 %)   Long-term debt 483,846 537,272 (53,426 ) (9.9 %)   Deferred income taxes 79,505 58,526 20,979 35.8 %   Other liabilities 10,588 9,321 1,267 13.6 %   Stockholders' equity: Common stock 11,625 11,576 49 0.4 % Additional paid-in capital 810,236 800,094 10,142 1.3 % Retained earnings 469,851 441,950 27,901 6.3 % Accumulated other comprehensive income 9,638 (6,238 ) 15,876 (254.5 %) Treasury stock, at cost (738,601 ) (739,712 ) 1,111 (0.2 %) Total Acxiom stockholders' equity 562,749 507,670 55,079 (2 ) Noncontrolling interest 4,383   -   4,383 -   Total equity 567,132   507,670   59,462 11.7 %   1,377,552   1,367,343   10,209 0.7 %         ACXIOM CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Dollars in thousands)   For the Three Months Ended   December 31,   2009     2008   Cash flows from operating activities: Net earnings (loss) 14,158 (11,449 ) Non-cash operating activities: Depreciation and amortization 43,170 49,677 Loss on disposal or impairment of assets, net 403 25,896 Deferred income taxes 14,381 (2,784 ) Non-cash stock compensation expense 2,638 1,807 Changes in operating assets and liabilities: Accounts receivable 1,814 1,958 Other assets 8,452 (6,940 ) Deferred costs (12,037 ) (918 ) Accounts payable and other liabilities (6,109 ) 21,107 Deferred revenue 7,639   559   Net cash provided by operating activities 74,509   78,913   Cash flows from investing activities: Sale of assets 1,058 - Capitalized software (1,846 ) (3,872 ) Capital expenditures (9,479 ) (6,232 ) Data acquisition costs (5,450 ) (7,825 ) Payment for investments (1,000 ) - Net cash paid in acquisitions (3,785 ) (2,700 ) Net cash used by investing activities (20,502 ) (20,629 ) Cash flows from financing activities: Payments of debt (17,316 ) (14,193 ) Fees for debt refinancing (4,563 ) - Sale of common stock 351 2,447 Tax benefit of stock options exercised - - Acquisition of treasury stock - (655 ) Noncontrolling interests equity contributions 457   -   Net cash used by financing activities (21,071 ) (12,401 ) Effect of exchange rate changes on cash 12   (1,178 )   Net increase in cash and cash equivalents 32,948 44,705 Cash and cash equivalents at beginning of period 167,634   93,370   Cash and cash equivalents at end of period 200,582   138,075     Supplemental cash flow information: Cash paid (received) during the period for: Interest 6,221 8,047 Income taxes (4,190 ) 2,901 Payments on capital leases and installment payment arrangements 7,309 9,033 Payments on software and data license liabilities 416 3,099 Other debt payments, excluding line of credit 2,091 2,061 Prepayment of debt 7,500 - Noncash investing and financing activities: Acquisition of property and equipment under capital lease and installment payment arrangements 7,860 2,233         ACXIOM CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Dollars in thousands)   For the Nine Months Ended   December 31,   2009     2008   Cash flows from operating activities: Net earnings 27,797 15,054 Non-cash operating activities: Depreciation and amortization 124,912 154,297 Loss on disposal or impairment of assets, net 410 22,654 Deferred income taxes 23,100 5,069 Non-cash stock compensation expense 8,288 8,040 Changes in operating assets and liabilities: Accounts receivable 5 (9,377 ) Other assets 11,913 13,875 Deferred costs (15,381 ) (2,986 ) Accounts payable and other liabilities (31,214 ) (6,222 ) Deferred revenue 1,548   (6,215 ) Net cash provided by operating activities 151,378   194,189   Cash flows from investing activities: Sale of assets 1,058 24,174 Capitalized software (6,661 ) (13,001 ) Capital expenditures (31,372 ) (19,183 ) Cash collected from sale and license of software - 2,000 Data acquisition costs (14,231 ) (22,954 ) Payment from (for) investments (1,000 ) 2,596 Net cash paid in acquisitions (3,428 ) (15,403 ) Net cash used by investing activities (55,634 ) (41,771 ) Cash flows from financing activities: Payments of debt (72,442 ) (73,694 ) Fees for debt refinancing (4,563 ) - Dividends paid - (9,312 ) Sale of common stock 3,014 8,362 Tax benefit of stock options exercised - 115 Acquisition of treasury stock (307 ) (655 ) Noncontrolling interests equity contributions 457   -   Net cash used by financing activities (73,841 ) (75,184 ) Effect of exchange rate changes on cash 1,513   (1,820 )   Net increase in cash and cash equivalents 23,416 75,414 Cash and cash equivalents at beginning of period 177,166   62,661   Cash and cash equivalents at end of period 200,582   138,075     Supplemental cash flow information: Cash paid (received) during the period for: Interest 16,807 24,468 Income taxes (8,450 ) (3,029 ) Payments on capital leases and installment payment arrangements 22,607 33,116 Payments on software and data license liabilities 6,134 19,887 Other debt payments, excluding line of credit 6,201 6,191 Prepayment of debt 37,500 14,500 Noncash investing and financing activities: Acquisition of property and equipment under capital lease and installment payment arrangements 18,247 7,892 Software licenses and maintenance acquired under software obligation 611 1,546                                     ACXIOM CORPORATION AND SUBSIDIARIES CALCULATION OF FREE CASH FLOW AVAILABLE TO EQUITY AND RECONCILIATION TO OPERATING CASH FLOW (Unaudited) (Dollars in thousands)       06/30/08     09/30/08     12/31/08     03/31/09     FY2009 06/30/09     09/30/09     12/31/09     FY2010   Net cash provided by operating activities 28,473 86,803 78,913 74,652 268,841 16,166 60,703 74,509 151,378   Plus: Sale of assets - 24,174 - - 24,174 - - 1,058 1,058 Payments received from investments 2,494 102 - 3 2,599 - - - -   Less: Capitalized software (5,011 ) (4,118 ) (3,872 ) (3,238 ) (16,239 ) (2,384 ) (2,431 ) (1,846 ) (6,661 ) Capital expenditures (5,706 ) (7,245 ) (6,232 ) (12,266 ) (31,449 ) (7,431 ) (14,462 ) (9,479 ) (31,372 ) Data acquisition costs (8,622 ) (6,507 ) (7,825 ) (7,607 ) (30,561 ) (5,777 ) (3,004 ) (5,450 ) (14,231 ) Payments on capital leases and installment payment arrangements (12,879 ) (11,204 ) (9,033 ) (7,673 ) (40,789 ) (7,794 ) (7,504 ) (7,309 ) (22,607 ) Payments on software and data license liabilities (8,368 ) (8,420 ) (3,099 ) (3,330 ) (23,217 ) (3,878 ) (1,840 ) (416 ) (6,134 ) Other required debt payments (2,057 )     (2,073 )     (2,061 )     (2,073 )     (8,264 ) (2,052 )     (2,058 )     (2,091 )     (6,201 )   Subtotal (11,676 ) 71,512 46,791 38,468 145,095 (13,150 ) 29,404 48,976 65,230   Plus: Tax benefit of stock options and warrants 60       55       -       (81 )     34   -       -       -       -     Subtotal (11,616 ) 71,567 46,791 38,387 145,129 (13,150 ) 29,404 48,976 65,230   Plus: Cash collected from sale of software 2,000       -       -       -       2,000   -       -       -       -     Total (9,616 )     71,567       46,791       38,387       147,129   (13,150 )     29,404       48,976       65,230     ACXIOM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Dollars in thousands, except earnings per share)                                                 Q3 FY09 to Q3 FY10 06/30/08     09/30/08     12/31/08     03/31/09     FY2009 06/30/09     09/30/09     12/31/09     FY2010 %     $ Revenue: Services 236,695 233,605 231,077 218,885 920,262 199,326 210,213 218,340 627,879 -5.5 % (12,737 ) Products 94,378       95,330       89,979       76,624       356,311   56,655       60,892       65,467       183,014   -27.2 %     (24,512 ) Total revenue 331,073 328,935 321,056 295,509 1,276,573 255,981 271,105 283,807 810,893 -11.6 % (37,249 )   Operating costs and expenses: Cost of revenue Services 178,861 180,986 173,433 161,060 694,340 159,576 165,792 163,206 488,574 5.9 % 10,227 Products 77,717       77,038       70,487       55,604       280,846   45,919       46,129       46,727       138,775   33.7 %     23,760   Total cost of revenue 256,578 258,024 243,920 216,664 975,186 205,495 211,921 209,933 627,349 13.9 % 33,987     Selling, general and administrative 49,482 38,988 42,560 38,930 169,960 37,643 37,964 43,477 119,084 -2.2 % (917 ) Gains, losses and other items, net (545 )     (2,370 )     43,175       (1,694 )     38,566   347       (27 )     538       858   98.8 %     42,637     Total operating costs and expenses 305,515 294,642 329,655 253,900 1,183,712 243,485 249,858 253,948 747,291 23.0 % 75,707   Income (loss) from operations 25,558 34,293 (8,599 ) 41,609 92,861 12,496 21,247 29,859 63,602 447.2 % 38,458 % Margin 7.7 % 10.4 % -2.7 % 14.1 % 7.3 % 4.9 % 7.8 % 10.5 % 7.8 % Other income (expense) Interest expense (9,459 ) (8,591 ) (8,105 ) (6,441 ) (32,596 ) (5,505 ) (5,423 ) (5,687 ) (16,615 ) 29.8 % 2,418 Other, net 1,359       287       140       163       1,949   (118 )     223       198       303   41.4 %     58   Total other income (expense) (8,100 ) (8,304 ) (7,965 ) (6,278 ) (30,647 ) (5,623 ) (5,200 ) (5,489 ) (16,312 ) 31.1 % 2,476   Earnings (loss) before income taxes 17,458 25,989 (16,564 ) 35,331 62,214 6,873 16,047 24,370 47,290 247.1 % 40,934 Income taxes 6,808       10,136       (5,115 )     12,881       24,710   2,679       6,602       10,212       19,493   -299.6 %     (15,327 )   Net earnings (loss) 10,650 15,853 (11,449 ) 22,450 37,504 4,194 9,445 14,158 27,797 223.7 % 25,607   Less: Net earnings (loss) attributable to noncontrolling interest -       -       -       -       -   -       -       (104 )     (104 ) -       (104 )   Net earnings (loss) attributable to Acxiom 10,650       15,853       (11,449 )     22,450       37,504   4,194       9,445       14,262       27,901   224.6 %     25,711       Diluted earnings (loss) per share attributable to Acxiom shareholders 0.14       0.20       (0.15 )     0.29       0.48   0.05       0.12       0.18       0.35   220.0 %     0.33     ACXIOM CORPORATION AND SUBSIDIARIES RESULTS BY SEGMENT (Unaudited) (Dollars in thousands)                                                 Q3 FY09 to Q3 FY10 06/30/08     09/30/08     12/31/08     03/31/09     FY2009 06/30/09     09/30/09     12/31/09     FY2010 %     $ Revenue:   Services 236,695 233,605 231,077 218,885 920,262 199,326 210,213 218,340 627,879 -5.5 % (12,737 ) Products 94,378       95,330       89,979       76,624       356,311   56,655       60,892       65,467       183,014   -27.2 %     (24,512 )   Total revenue 331,073       328,935       321,056       295,509       1,276,573   255,981       271,105       283,807       810,893   -11.6 %     (37,249 )   Income from operations:   Services 25,639 28,527 30,358 32,873 117,397 15,838 19,971 27,565 63,374 -9.2 % (2,793 ) Products (626 ) 3,396 4,218 7,042 14,030 (2,995 ) 1,249 2,832 1,086 -32.9 % (1,386 ) Other 545       2,370       (43,175 )     1,694       (38,566 ) (347 )     27       (538 )     (858 ) 98.8 %     42,637     Total income (loss) from operations 25,558       34,293       (8,599 )     41,609       92,861   12,496       21,247       29,859       63,602   447.2 %     38,458     Margin:   Services 10.8 % 12.2 % 13.1 % 15.0 % 12.8 % 7.9 % 9.5 % 12.6 % 10.1 % Products -0.7 % 3.6 % 4.7 % 9.2 % 3.9 % -5.3 % 2.1 % 4.3 % 0.6 %   Total 7.7 % 10.4 % -2.7 % 14.1 % 7.3 % 4.9 % 7.8 % 10.5 % 7.8 %  

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