Acxiom® Corporation (Nasdaq: ACXM), a recognized leader in
marketing services and technology, today announced financial
results for its third quarter ended December 31, 2012.
Revenue from continuing operations was $273 million, down 3
percent compared to $281 million for the prior-year period. Income
from continuing operations increased 73 percent to $27 million in
the current quarter, compared to $16 million in the prior year.
Excluding unusual items, operating income for the quarter decreased
13 percent as compared to $31 million in the prior year. Marketing
and data services revenue increased slightly to $190 million,
compared to $187 million; U.S. marketing and data services revenue
increased 4 percent to $160 million, compared to $155 million. As
expected, IT infrastructure management revenue decreased 9 percent
to $70 million in the current quarter compared to $77 million.
Earnings per diluted share attributable to Acxiom stockholders were
up 90 percent in the current quarter to $0.19, compared to diluted
earnings per share in the prior-year quarter of $0.10. Diluted
earnings per share decreased 14 percent as compared to $0.22,
excluding unusual items in the prior-year quarter.
Operating cash flow was $132 million for the trailing twelve
months, compared to $215 million for the comparable period a year
ago. Free cash flow to equity increased slightly to $117 million
for the trailing twelve months, compared to $115 million for the
comparable period. Free cash flow to equity for the trailing twelve
months included $73 million in proceeds from the sale of the
company’s background screening business. Both operating cash flow
and free cash flow to equity were down as a result of higher
working capital and increased tax payments. Free cash flow
available to equity is a non-GAAP financial measure. A
reconciliation to the comparable GAAP measure, operating cash flow,
is attached.
“Revenue from our top 100 U.S. marketing and data services
customers was up over 7 percent this quarter and up over 9 percent
year to date,” said Acxiom CEO Scott Howe. “While we are pleased
with this performance, we also recognize we have work to do in
order to further expand our client base and reignite growth with
our small and mid-tier customers.”
Third Quarter Highlights:
- Acxiom continues to invest in its
new digital products suite. During the quarter, the company
released the following new products: InfoBase data for major ad
platforms and over 1,500 predictive models for 10 major industry
verticals. The company intends to hold a product briefing with
investors on March 6 in New York City. The briefing will be
presented by Dr. Phil Mui, key members of the engineering team and
Nada Stirratt, the company’s Chief Revenue Officer.
- Acxiom repurchased 1,040,000 shares
for $18.3 million during the quarter. Since inception of the
share repurchase program in August 2011, the company has
repurchased 9.9 million shares, or approximately 12 percent of the
outstanding common stock, for $131 million. The company has
remaining capacity of approximately $19 million out of the total
stock repurchase authorization of $150 million.
- Acxiom announced its annual
invitation-only client forum known as Engage to be held
on March 6-8 in New York City. Over 200 top clients and
prospects are registered to attend the conference which provides
the opportunity for the world’s largest marketers to discuss case
studies and new technologies. President Bill Clinton will deliver
the keynote address and statistician Nate Silver will also be
featured.
- Acxiom appointed Dana Hayes, Jr. as
Group VP of Partner Development. Hayes will lead efforts to
build strategic partnerships and distribution relationships for
global data driven marketing and advertising. He has more than 15
years of experience in digital media and marketing in leadership
roles with companies such as weather.com and Tribune Company.
Segment Results:
- Marketing and Data Services:
Revenue for the third quarter increased slightly to $190 million,
as compared to $187 million for the same period a year ago. U.S.
revenue of $160 million increased 4 percent but was offset by
declines internationally. Income from operations for the third
quarter was $18 million, compared to $21 million in the prior
period. Operating margin was 10 percent, compared to 11 percent in
the previous year.
- IT Infrastructure Management:
Revenue for the third quarter decreased 9 percent to $70 million,
compared to $77 million for the same period a year ago. Income from
operations for the quarter was roughly flat at $10 million.
Operating margin was approximately 14 percent, compared to 13
percent a year ago.
- Other Services: Revenue was $13
million as compared to $16 million in the prior year. Loss from
operations was roughly flat at $1 million.
Financial Guidance
The following projections are forward looking and are subject to
certain risks and uncertainties that could cause actual results to
differ materially as detailed in the Forward Looking Statements
section of this press release. Our guidance does not take into
account any unusual charges. Acxiom’s estimates for fiscal 2013 are
as follows:
- We expect revenue for the fiscal year
to be down approximately 2.5 percent as compared to $1.131 billion
in the prior year. The decline is projected primarily as a result
of decreases in IT infrastructure management and international
operations.
- We now expect earnings per diluted
share of up to $.73 as compared to our previous guidance of roughly
$.70.
Conference Call
Acxiom will hold a conference call at 4:00 p.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. A slide presentation will be referenced during the
call and can be accessed here.
Web Link to Financials
You may link to http://www.acxiom.com/FY13_Q3_Financials for the
detailed financial information we typically attach to our earnings
releases.
About Acxiom
Acxiom is a recognized leader in marketing services and
technology that enable marketers to successfully manage audiences,
personalize consumer experiences and create profitable customer
relationships. Our superior industry-focused, consultative approach
combines consumer data and analytics, databases, data integration
and consulting solutions for personalized, multichannel marketing
strategies. Acxiom leverages over 40 years of experience in data
management to deliver high-performance, highly secure, reliable
information management services. Founded in 1969, Acxiom is
headquartered in Little Rock, Arkansas, USA, and serves clients
around the world from locations in the United States, Europe,
Asia-Pacific, and South America. For more information about Acxiom,
visit Acxiom.com.
Forward Looking Statements
This release and today’s conference call may contain
forward-looking statements including, without limitation,
statements regarding expected levels of revenue from continuing
operations and earnings per share as well as statements regarding
new product launches. 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 data suppliers might withdraw data
from us, leading to our inability to provide certain products and
services to our clients, which could lead to decreases in our
operating results; 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; the
possibility that we may not be able to adequately adapt to rapidly
changing computing environments, technologies and marketing
practices; 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 unusual charges may be
incurred; 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; the possibility that we could experience
loss of data center capacity or interruption of telecommunication
links; the possibility that new laws may be enacted which limit our
ability to provide services to our clients and/or which limit the
use of data; 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 reports 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, 2012, which was filed with the Securities and Exchange
Commission on May 25, 2012.
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, $ % 2012 2011 Variance
Variance Revenue: Marketing and data services
190,138 187,461 2,677 1.4 % IT Infrastructure management services
69,916 77,173 (7,257 ) (9.4 %) Other services 13,048 16,259
(3,211 ) (19.7 %) Total revenue 273,102 280,893 (7,791 )
(2.8 %) Operating costs and expenses: Cost of revenue
209,027 213,925 4,898 2.3 % Selling, general and administrative
37,303 36,318 (985 ) (2.7 %) Impairment of goodwill and other
intangibles - 17,803 17,803 100.0 % Gains, losses and other items,
net (126 ) (2,671 ) 2,545 95.3 % Total operating costs and
expenses 246,204 265,375 19,171 7.2 % Income
from operations 26,898 15,518 11,380 73.3 % %
Margin 9.8 % 5.5 % Other income
(expense): Interest expense (3,178 ) (3,883 ) 705 18.2 % Other, net
565 (98 ) 663 676.5 % Total other income (expense)
(2,613 ) (3,981 ) 1,368 34.4 % Earnings from continuing
operations before income taxes 24,285 11,537 12,748 110.5 %
Income taxes 9,836 9,700 (136 ) (1.4 %) Net
earnings from continuing operations 14,449 1,837 12,612 686.6 %
Earnings from discontinued operations, net of tax -
814 (814 ) (100.0 %) Net earnings 14,449 2,651 11,798
445.0 % Less: Net loss attributable to noncontrolling
interest (76 ) (5,279 ) 5,203 98.6 % Net earnings
attributable to Acxiom 14,525 7,930 6,595 83.2 %
Basic earnings per share: Net earnings from continuing
operations 0.19 0.02 0.17 850.0 % Earnings from discontinued
operations 0.00 0.01 (0.01 ) (100.0 %) Net earnings
0.19 0.03 0.16 533.3 % Net earnings
attributable to Acxiom stockholders 0.20 0.10 0.10
100.0 % Diluted earnings per share: Net earnings from
continuing operations 0.19 0.02 0.17 850.0 % Earnings from
discontinued operations 0.00 0.01 (0.01 ) (100.0 %)
Net earnings 0.19 0.03 0.16 533.3 % Net
earnings attributable to Acxiom stockholders 0.19 0.10
0.09 90.0 %
ACXIOM CORPORATION AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF OPERATIONS (Unaudited) (Dollars in thousands, except
earnings per share) For the Nine Months Ended December 31, $
% 2012 2011 Variance Variance Revenue:
Marketing and data services 570,286 568,314 1,972 0.3 % IT
Infrastructure management services 210,267 223,935 (13,668 ) (6.1
%) Other services 41,675 51,120 (9,445 ) (18.5 %)
Total revenue 822,228 843,369 (21,141 ) (2.5 %) Operating
costs and expenses: Cost of revenue 628,239 649,701 21,462 3.3 %
Selling, general and administrative 111,393 112,554 1,161 1.0 %
Impairment of goodwill and other intangibles - 17,803 17,803 100.0
% Gains, losses and other items, net 66 38 (28 )
(73.7 %) Total operating costs and expenses 739,698
780,096 40,398 5.2 % Income from operations 82,530
63,273 19,257 30.4 % %
Margin 10.0
% 7.5 % Other income (expense): Interest
expense (9,735 ) (14,057 ) 4,322 30.7 % Other, net (36 ) (1,150 )
1,114 96.9 % Total other income (expense) (9,771 ) (15,207 )
5,436 35.7 % Earnings from continuing operations before
income taxes 72,759 48,066 24,693 51.4 % Income taxes 28,739
25,291 (3,448 ) (13.6 %) Net earnings from
continuing operations 44,020 22,775 21,245 93.3 % Earnings
from discontinued operations, net of tax - 2,868
(2,868 ) (100.0 %) Net earnings 44,020 25,643 18,377 71.7 %
Less: Net loss attributable to noncontrolling interest (349
) (5,554 ) 5,205 93.7 % Net earnings attributable to Acxiom
44,369 31,197 13,172 42.2 % Basic earnings per
share: Net earnings from continuing operations 0.59 0.28 0.31 110.7
% Earnings from discontinued operations 0.00 0.04
(0.04 ) (100.0 %) Net earnings 0.59 0.32 0.27 84.4 %
Net earnings attributable to Acxiom stockholders 0.59
0.39 0.20 51.3 % Diluted earnings per share:
Net earnings from continuing operations 0.57 0.28 0.29 103.6 %
Earnings from discontinued operations 0.00 0.04 (0.04
) (100.0 %) Net earnings 0.57 0.32 0.25 78.1 %
Net earnings attributable to Acxiom stockholders 0.58 0.39
0.19 48.7 %
ACXIOM CORPORATION AND SUBSIDIARIES RECONCILIATION OF
GAAP TO NON-GAAP EPS (Unaudited) (Dollars in thousands, except
earnings per share) For the Three Months Ended For the Nine
Months Ended December 31, December 31, 2012 2011 2012 2011
Earnings from continuing operations before income taxes
24,285 11,537 72,759 48,066 Income taxes 9,836 9,700
28,739 25,291 Net earnings from
continuing operations 14,449 1,837 44,020 22,775 Earnings
from discontinued operations, net of tax - 814 -
2,868 Net earnings 14,449 2,651 44,020 25,643
Less: Net earnings (loss) attributable to noncontrolling
interest (76 ) (5,279 ) (349 ) (5,554 ) Net earnings
attributable to Acxiom 14,525 7,930 44,369
31,197 Earnings per share attributable to Acxiom
stockholders: Basic 0.20 0.10 0.59 0.39
Diluted 0.19 0.10 0.58 0.39
Unusual items: MENA disposal - - - 2,512
Impairment of goodwill and other intangibles - 17,803 - 17,803
Adjustment of earnout liability - (2,598 ) - (2,598 ) Other
adjustments (126 ) (73 ) 66 124 Total unusual
items (126 ) 15,132 66 17,841 Earnings
from continuing operations before income taxes and excluding
unusual items 24,159 26,669 72,825 65,907 Income taxes 9,760
10,649 28,764 26,341 Non-GAAP
earnings from continuing operations 14,399 16,020 44,061 39,566
Earnings from discontinued operations, net of tax -
814 - 2,868 Non-GAAP net earnings
14,399 16,834 44,061 42,434 Less: Net earnings (loss)
attributable to noncontrolling interest (76 ) (231 ) (349 ) (1,371
) Non-GAAP Net earnings attributable to Acxiom 14,475
17,065 44,410 43,805 Non-GAAP earnings
per share attributable to Acxiom stockholders: Basic 0.20
0.22 0.59 0.55 Diluted 0.19
0.22 0.58 0.54 Diluted weighted
average shares 75,878 79,020 76,987 80,877
ACXIOM CORPORATION AND SUBSIDIARIES RECONCILIATION OF GAAP
TO NON-GAAP INCOME FROM OPERATIONS (Unaudited) (Dollars in
thousands, except earnings per share) For the Three Months
Ended For the Nine Months Ended December 31, December 31, 2012 2011
2012 2011 Income from operations 26,898 15,518 82,530 63,273
Unusual items (126 ) 15,132 66 17,841 Income from
operations before unusual items 26,772 30,650 82,596 81,114
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, 2012 2011 Basic
earnings per share from continuing operations: Numerator - net
earnings 14,449 1,837 Denominator - weighted-average shares
outstanding 74,103 78,189 Basic earnings per share 0.19 0.02
Basic earnings per share - net earnings attributable to Acxiom
stockholders: Numerator - net earnings attributable to Acxiom
14,525 7,930 Denominator - weighted-average shares outstanding
74,103 78,189 Basic earnings per share - net earnings attributable
to Acxiom stockholders 0.20 0.10 Diluted earnings per share
from continuing operations: Numerator - net earnings 14,449 1,837
Denominator - weighted-average shares outstanding 74,103 78,189
Dilutive effect of common stock options, warrants and restricted
stock 1,775 831 75,878 79,020 Diluted earnings per share
from continuing operations 0.19 0.02 Diluted earnings per
share - net earnings attributable to Acxiom stockholders: Numerator
- net earnings attributable to Acxiom 14,525 7,930 Denominator -
weighted-average shares outstanding 74,103 78,189 Dilutive effect
of common stock options, warrants, and restricted stock 1,775 831
75,878 79,020 Diluted earnings per share - net earnings
attributable to Acxiom stockholders 0.19 0.10
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, 2012 2011 Basic earnings per share from
continuing operations: Numerator - net earnings 44,020 22,775
Denominator - weighted-average shares outstanding 75,195 80,039
Basic earnings per share 0.59 0.28 Basic earnings per share
- net earnings attributable to Acxiom stockholders: Numerator - net
earnings attributable to Acxiom 44,369 31,197 Denominator -
weighted-average shares outstanding 75,195 80,039 Basic earnings
per share - net earnings attributable to Acxiom stockholders 0.59
0.39 Diluted earnings per share from continuing operations:
Numerator - net earnings 44,020 22,775 Denominator -
weighted-average shares outstanding 75,195 80,039 Dilutive effect
of common stock options, warrants and restricted stock 1,792 838
76,987 80,877 Diluted earnings per share from continuing
operations 0.57 0.28 Diluted earnings per share - net
earnings attributable to Acxiom stockholders: Numerator - net
earnings attributable to Acxiom 44,369 31,197 Denominator -
weighted-average shares outstanding 75,195 80,039 Dilutive effect
of common stock options, warrants, and restricted stock 1,792 838
76,987 80,877 Diluted earnings per share - net earnings
attributable to Acxiom stockholders 0.58 0.39
ACXIOM CORPORATION AND SUBSIDIARIES RESULTS BY
SEGMENT (Unaudited) (Dollars in thousands) For the Three
Months Ended December 31, December 31,
Revenue: 2012
2011 Marketing and data services 190,138 187,461 IT
Infrastructure management services 69,916 77,173 Other services
13,048 16,259 Total revenue 273,102
280,893
Income from continuing
operations: Marketing and data services 17,971 21,388 IT
Infrastructure management services 9,622 9,795 Other services (821
) (533 ) Corporate 126 (15,132 ) Total income from
continuing operations 26,898 15,518
Margin: Marketing and data services 9.5 % 11.4 % IT
Infrastructure management services 13.8 % 12.7 % Other services
-6.3 % -3.3 % Total margin 9.8 % 5.5 %
ACXIOM CORPORATION AND SUBSIDIARIES RESULTS BY
SEGMENT (Unaudited) (Dollars in thousands) For the Nine
Months Ended December 31, December 31,
Revenue: 2012
2011 Marketing and data services 570,286 568,314 IT
Infrastructure management services 210,267 223,935 Other services
41,675 51,120 Total revenue 822,228
843,369
Income from operations:
Marketing and data services 59,277 65,726 IT Infrastructure
management services 26,973 19,133 Other services (3,654 ) (3,745 )
Corporate (66 ) (17,841 ) Total income from operations
82,530 63,273
Margin: Marketing
and data services 10.4 % 11.6 % IT Infrastructure management
services 12.8 % 8.5 % Other services -8.8 % -7.3 % Total
margin 10.0 % 7.5 %
ACXIOM CORPORATION AND SUBSIDIARIES CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited) (Dollars in thousands)
December 31, March 31, $ % 2012 2012 Variance
Variance
Assets
Current assets: Cash and cash equivalents 186,220 229,648 (43,428 )
(18.9 %) Trade accounts receivable, net 182,457 169,446 13,011 7.7
% Deferred income taxes 15,082 15,107 (25 ) (0.2 %) Other current
assets 52,750 57,804 (5,054 ) 100.0 % Total
current assets 436,509 472,005 (35,496 ) (7.5 %) Property
and equipment 811,416 913,073 (101,657 ) (11.1 %) Less -
accumulated depreciation and amortization 579,642 659,700
(80,058 ) (12.1 %) Property and equipment, net
231,774 253,373 (21,599 ) (8.5 %) Software,
net of accumulated amortization 19,491 13,211 6,280 47.5 % Goodwill
382,704 382,285 419 0.1 % Purchased software licenses, net of
accumulated amortization 21,583 25,294 (3,711 ) (14.7 %) Deferred
costs, net 47,211 61,977 (14,766 ) (23.8 %) Data acquisition costs
11,540 15,009 (3,469 ) (23.1 %) Other assets, net 2,831
3,697 (866 ) (23.4 %) 1,153,643 1,226,851
(73,208 ) (6.0 %)
Liabilities and
Stockholders’ Equity
Current liabilities: Current installments of long-term debt 19,814
26,336 6,522 24.8 % Trade accounts payable 19,873 31,030 11,157
36.0 % Accrued payroll and related expenses 47,041 54,839 7,798
14.2 % Other accrued expenses 73,696 77,062 3,366 4.4 % Deferred
revenue 47,389 59,949 12,560 21.0 % Income taxes 3,229
16,400 13,171 80.3 % Total current liabilities
211,042 265,616 54,574 20.5 % Long-term debt
240,774 251,886 11,112 4.4 % Deferred income taxes 86,614
93,039 6,425 6.9 % Other liabilities 4,178 4,455 277 6.2 %
Stockholders’ equity:
Common stock 12,108 12,003 105 0.9 % Additional paid-in capital
877,619 860,165 17,454 2.0 % Retained earnings 580,728 536,359
44,369 8.3 % Accumulated other comprehensive income 14,714 13,601
1,113 8.2 % Treasury stock, at cost (873,893 ) (810,381 ) (63,512 )
7.8 %
Total Acxiom stockholders’ equity
611,276 611,747 (471 ) (0.1 %) Noncontrolling interest (241 ) 108
(349 ) (323.1 %) Total equity 611,035 611,855
(820 ) (0.1 %) 1,153,643 1,226,851
(73,208 ) (6.0 %) ACXIOM
CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (Unaudited) (Dollars in thousands) For the Three
Months Ended December 31, 2012 2011 Cash flows
from operating activities: Net earnings 14,449 2,651 Non-cash
operating activities: Depreciation and amortization 29,363 32,986
Gain on disposal or impairment of assets - (2,710 ) Impairment of
goodwill and other intangibles - 17,803 Deferred income taxes
(2,962 ) 1,404 Non-cash stock compensation expense 3,103 1,710
Changes in operating assets and liabilities: Accounts receivable
(15,867 ) 6,913 Other assets 5,492 4,390 Deferred costs (326 )
(1,048 ) Accounts payable and other liabilities 5,525 1,320
Deferred revenue (234 ) 17,121 Net cash provided by
operating activities 38,543 82,540 Cash flows from
investing activities: Capitalized software (5,443 ) (1,647 )
Capital expenditures (10,260 ) (14,436 ) Data acquisition costs
(2,766 ) (3,999 ) Payments received from investments - 370
Net cash used by investing activities (18,469 ) (19,712 )
Cash flows from financing activities: Payments of debt (6,252 )
(31,993 ) Sale of common stock 2,128 4,500 Acquisition of treasury
stock (18,256 ) (8,727 ) Net cash used by financing activities
(22,380 ) (36,220 ) Effect of exchange rate changes on cash 122
142 Net change in cash and cash equivalents
(2,184 ) 26,750 Cash and cash equivalents at beginning of period
188,404 119,113 Cash and cash equivalents at end of
period 186,220 145,863
Supplemental cash
flow information: Cash paid during the period for: Interest
3,178 4,160 Income taxes 12,104 9,784 Payments on capital leases
and installment payment arrangements 4,002 4,709 Payments on
software and data license liabilities 78 125 Other debt payments,
excluding line of credit 2,172 2,159 Prepayment of debt - 25,000
Noncash investing and financing activities:
Acquisition of property and equipment
under capital lease and installment payment arrangements
- 4,042 ACXIOM CORPORATION AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (Dollars in thousands) For the Nine Months Ended
December 31, 2012 2011 Cash flows from
operating activities: Net earnings 44,020 25,643 Non-cash operating
activities: Depreciation and amortization 89,594 103,240 Loss on
disposal or impairment of assets 25 183 Impairment of goodwill and
other intangibles - 17,803 Deferred income taxes (6,428 ) 2,539
Non-cash stock compensation expense 8,906 6,910 Changes in
operating assets and liabilities: Accounts receivable (13,925 )
(2,763 ) Other assets 756 (202 ) Deferred costs (1,600 ) (1,879 )
Accounts payable and other liabilities (32,607 ) 7,391 Deferred
revenue (12,830 ) 14,143 Net cash provided by operating
activities 75,911 173,008 Cash flows from investing
activities: Disposition of operations - (1,043 ) Capitalized
software (13,190 ) (3,167 ) Capital expenditures (21,976 ) (39,147
) Data acquisition costs (6,464 ) (8,549 ) Payments from
investments - 370 Net cash paid in acquisitions - (255 ) Net
cash used by investing activities (41,630 ) (51,791 ) Cash flows
from financing activities: Payments of debt (19,790 ) (145,768 )
Sale of common stock 7,863 7,318 Acquisition of treasury stock
(65,356 ) (42,827 ) Contingent consideration paid for prior
acquisitions (287 ) (326 ) Net cash used by financing activities
(77,570 ) (181,603 ) Effect of exchange rate changes on cash (139 )
(724 ) Net change in cash and cash equivalents (43,428 )
(61,110 ) Cash and cash equivalents at beginning of period 229,648
206,973 Cash and cash equivalents at end of period
186,220 145,863
Supplemental cash flow
information: Cash paid during the period for: Interest 9,678
15,491 Income taxes 48,268 15,171 Payments on capital leases and
installment payment arrangements 12,948 13,687 Payments on software
and data license liabilities 337 616 Other debt payments, excluding
line of credit 6,505 6,465 Prepayment of debt - 125,000 Noncash
investing and financing activities:
Acquisition of property and equipment
under capital lease and installment payment arrangements
2,157 8,733
ACXIOM CORPORATION AND
SUBSIDIARIES CALCULATION OF FREE CASH FLOW AVAILABLE TO EQUITY AND
RECONCILIATION TO OPERATING CASH FLOW (Unaudited) (Dollars in
thousands) 06/30/11
09/30/11 12/31/11 03/31/12
FY2012 06/30/12 09/30/12
12/31/12 YTD FY2013 TTM 12/31/11 TTM
12/31/12 Net cash provided (used) by operating activities
32,754 57,714 82,540 56,443 229,451 (1,867 ) 39,235 38,543 75,911
215,043 132,354 Less: Disposition of operations - (1,043 ) -
73,468 72,425 - - - - (1,043 ) 73,468 Capitalized software (529 )
(991 ) (1,647 ) (2,095 ) (5,262 ) (3,673 ) (4,074 ) (5,443 )
(13,190 ) (4,130 ) (15,285 ) Capital expenditures (12,577 ) (12,134
) (14,436 ) (12,444 ) (51,591 ) (3,538 ) (8,178 ) (10,260 ) (21,976
) (51,360 ) (34,420 ) Data acquisition costs (2,776 ) (1,774 )
(3,999 ) (3,763 ) (12,312 ) (2,302 ) (1,396 ) (2,766 ) (6,464 )
(11,199 ) (10,227 ) Payments on capital leases and installment
payment arrangements (4,794 ) (4,184 ) (4,709 ) (4,644 ) (18,331 )
(4,562 ) (4,384 ) (4,002 ) (12,948 ) (18,939 ) (17,592 ) Payments
on software and data license liabilities (367 ) (124 ) (125 )
(2,300 ) (2,916 ) (129 ) (130 ) (78 ) (337 ) (4,755 ) (2,637 )
Other required debt payments (2,151 ) (2,155 )
(2,159 ) (2,164 ) (8,629 )
(2,165 ) (2,168 ) (2,172 )
(6,505 ) (8,619 ) (8,669 ) Total 9,560
35,309 55,465
102,501 202,835 (18,236 )
18,905 13,822
14,491 114,998 116,992
CONSOLIDATED STATEMENTS OF
OPERATIONS (Unaudited) (Dollars in thousands, except earnings per
share) Q3 FY13 to Q3 FY12 06/30/11
09/30/11 12/31/11 03/31/12
FY2012 06/30/12 09/30/12
12/31/12 YTD FY2013 % $ Revenue:
Marketing and data services 184,996 195,857 187,461 203,400 771,714
185,739 194,409 190,138 570,286 1.4 % 2,677 IT Infrastructure
management services 73,050 73,712 77,173 67,590 291,525 70,290
70,061 69,916 210,267 -9.4 % (7,257 ) Other services 17,998
16,863 16,259
16,265 67,385 15,630
12,997 13,048
41,675 -19.7 % (3,211 ) Total revenue
276,044 286,432 280,893 287,255 1,130,624 271,659 277,467 273,102
822,228 -2.8 % (7,791 ) Operating costs and expenses: Cost
of revenue 218,289 217,487 213,925 213,788 863,489 209,326 209,886
209,027 628,239 -2.3 % (4,898 ) Selling, general and administrative
36,807 39,429 36,318 38,577 151,131 36,749 37,341 37,303 111,393
2.7 % 985 Impairment of goodwill and other intangibles - - 17,803 -
17,803 - - - - (17,803 ) Gains, losses and other items, net 244
2,465 (2,671 )
12,600 12,638 160
32 (126 ) 66 -95.3
% 2,545 Total operating costs and
expenses 255,340 259,381 265,375 264,965 1,045,061 246,235 247,259
246,204 739,698 -7.2 % (19,171 ) Income from operations
20,704 27,051 15,518 22,290 85,563 25,424 30,208 26,898 82,530 73.3
% 11,380
% Margin 7.5 % 9.4 %
5.5 % 7.8 % 7.6 %
9.4 % 10.9 % 9.8 %
10.0 % Other expense Interest expense (5,455 ) (4,719
) (3,883 ) (3,391 ) (17,448 ) (3,240 ) (3,317 ) (3,178 ) (9,735 )
18.2 % 705 Other, net (87 ) (965 ) (98
) (219 ) (1,369 ) (547 )
(54 ) 565 (36 ) 676.5 %
663 Total other expense (5,542 ) (5,684 ) (3,981 )
(3,610 ) (18,817 ) (3,787 ) (3,371 ) (2,613 ) (9,771 ) 34.4 % 1,368
Earnings from continuing operations before income taxes
15,162 21,367 11,537 18,680 66,746 21,637 26,837 24,285 72,759
110.5 % 12,748 Income taxes 6,063 9,528
9,700 3,838
29,129 8,438 10,465
9,836 28,739 1.4 %
136 Net earnings from continuing operations 9,099
11,839 1,837 14,842 37,617 13,199 16,372 14,449 44,020 686.6 %
12,612 Earnings from discontinued operations, net of tax 916
1,138 814
31,031 33,899 -
- - -
-100.0 % (814 ) Net earnings 10,015 12,977
2,651 45,873 71,516 13,199 16,372 14,449 44,020 445.0 % 11,798
Less: Net earnings (loss) attributable to
noncontrolling interest
(960 ) 685 (5,279 )
(193 ) (5,747 ) (134 ) (139 )
(76 ) (349 ) -98.6 %
5,203 Net earnings attributable to Acxiom 10,975
12,292 7,930
46,066 77,263 13,333
16,511 14,525
44,369 83.2 % 6,595
Diluted earnings per share - net earnings
attributable to Acxiom stockholders
0.13 0.15 0.10
0.58 0.96 0.17
0.21 0.19
0.58 90.0 % 0.09 ACXIOM
CORPORATION AND SUBSIDIARIES RESULTS BY SEGMENT (Unaudited)
(Dollars in thousands)
Q3
FY13 to Q3 FY12 06/30/11 09/30/11
12/31/11 03/31/12 FY2012 06/30/12
09/30/12 12/31/12 YTD
FY2013 % $ Revenue: Marketing and data
services 184,996 195,857 187,461 203,400 771,714 185,739 194,409
190,138 570,286 1 % 2,677 IT Infrastructure management services
73,050 73,712 77,173 67,590 291,525 70,290 70,061 69,916 210,267 -9
% (7,257 ) Other services 17,998 16,863
16,259 16,265
67,385 15,630 12,997
13,048 41,675 -20 %
(3,211 ) Total revenue 276,044
286,432 280,893
287,255 1,130,624 271,659
277,467 273,102
822,228 -3 % (7,791 ) Income (loss)
from operations: Marketing and data services 17,260 27,078
21,388 30,094 95,820 17,975 23,331 17,971 59,277 -16 % (3,417 ) IT
Infrastructure management services 4,247 5,091 9,795 5,855 24,988
8,831 8,520 9,622 26,973 -2 % (173 ) Other services (559 ) (2,653 )
(533 ) (1,059 ) (4,804 ) (1,222 ) (1,611 ) (821 ) (3,654 ) 54 %
(288 ) Corporate (244 ) (2,465 )
(15,132 ) (12,600 ) (30,441 ) (160 )
(32 ) 126 (66 )
-101 % 15,258 Total income from
operations 20,704 27,051
15,518 22,290 85,563
25,424 30,208
26,898 82,530 73 % 11,380
Margin: Marketing and data services 9.3 % 13.8
% 11.4 % 14.8 % 12.4 % 9.7 % 12.0 % 9.5 % 10.4 % IT Infrastructure
management services 5.8 % 6.9 % 12.7 % 8.7 % 8.6 % 12.6 % 12.2 %
13.8 % 12.8 % Other services -3.1 % -15.7 % -3.3 % -6.5 % -7.1 %
-7.8 % -12.4 % -6.3 % -8.8 % Total 7.5 % 9.4 % 5.5 % 7.8 %
7.6 % 9.4 % 10.9 % 9.8 % 10.0 %
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