LiveRamp (RAMP) 8-K Acxiom Announces First Quarter Fiscal Year 2012 Results

 

For more information, contact:

Katharine Boyce

Acxiom Investor Relations

501-342-1321

investor.relations@acxiom.com

EACXM

ACXIOM ANNOUNCES FIRST QUARTER FISCAL YEAR 2012 RESULTS

LITTLE ROCK, Ark. – July 27, 2011 — Acxiom® Corporation (Nasdaq: ACXM), a recognized leader in marketing services and technology, today announced financial results for the first quarter of fiscal year 2012 ended June 30, 2011. Acxiom will hold a conference call at 9:00 a.m. CDT today to further discuss this information. Interested parties are invited to listen to the call, which will be broadcast via the Internet at www.acxiom.com.

Jerry Gramaglia, Acxiom’s interim chief executive officer, said, "We achieved overall solid financial performance for the quarter and are pleased with our continued revenue growth, especially in our core U.S. marketing services and products business. During the quarter we increased spending in sales, account management and service delivery to continue our momentum and position Acxiom for strong performance through the balance of the year."

First Quarter 2012 Highlights:

·   Revenue increased by 6.9% in the current quarter ended June 30, 2011 to $288.9 million, compared to $270.4 million for the quarter ended June 30, 2010.

·   Income from operations of $22.2 million in the current-year first quarter, compared to income from operations of $22.1 million in the first quarter of the prior year.

·   Earnings per diluted share attributable to Acxiom stockholders of $0.13 in the current quarter, compared to earnings per share of $0.12 in the first quarter of fiscal 2011.

·   Operating cash flow of $32.8 million, compared to $17.0 million in the first quarter a year ago.

·   Free cash flow available to equity of $9.6 million, compared to negative $6.3 million in the first quarter a year ago. Free cash flow available to equity is a non-GAAP financial measure; a reconciliation to the comparable GAAP measure, operating cash flow, is attached to this news release.

Operational Highlights:

·   Information Services: Revenue for the quarter ended June 30, 2011 was $225.6 million, up 7.1%, compared to $210.7 million for the quarter ended June 30, 2010. Income from operations for the current first quarter was $20.2 million, down 3.4% compared to $20.9 million in the prior-year first quarter.

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·   Information Products: Revenue for the quarter increased 6.0% to $63.3 million, compared with $59.7 million in the first quarter a year ago. Income from operations for the quarter was $2.3 million, compared to $1.1 million in the first quarter of the previous year.

·   Debt prepayment: The company prepaid $25 million of its term loan due March 15, 2015 in the current quarter. Subsequent to the end of the June 30, 2011 quarter, the company prepaid an additional $75 million of the term loan.

·   Middle East and North Africa (MENA) disposal: Subsequent to the end of the June 30, 2011 quarter, the company disposed of its ownership interest in MENA.

Web Link to Financials

You may link to http://www.acxiom.com/FY12_Q1_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 our expectation for strong performance for the balance of the 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 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 be unable to quickly and seamlessly integrate a new chief executive officer and chief financial officer; 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

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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; the possibility that we could experience loss of data center capacity or interruption of telecommunication links; 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 Reports on Form 10-K for the year ended March 31, 2011, which was filed with the Securities and Exchange Commission on May 27, 2011.

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
	June 30,
										$		%
	2011			2010			Variance			Variance
Revenue:
Services		225,604			210,656			14,948			7.1	%
Products		63,330			59,739			3,591			6.0	%
Total revenue		288,934			270,395			18,539			6.9	%
Operating costs and expenses:
Cost of revenue
Services		180,463			164,650			(15,813	)		(9.6	%)
Products		48,878			45,771			(3,107	)		(6.8	%)
Total cost of revenue		229,341			210,421			(18,920	)		(9.0	%)
Services gross margin		20.0	%		21.8	%
Products gross margin		22.8	%		23.4	%
Total gross margin		20.6	%		22.2	%
Selling, general and administrative		37,119			37,955			836			2.2	%
Gains, losses and other items, net		244			(57	)		(301	)		(528.1	%)
Total operating costs and expenses		266,704			248,319			(18,385	)		(7.4	%)
Income from operations		22,230			22,076			154			0.7	%
Other income (expense):
Interest expense		(5,455	)		(5,898	)		443			7.5	%
Other, net		(87	)		(451	)		364			80.7	%
Total other income (expense)		(5,542	)		(6,349	)		807			12.7	%
Earnings before income taxes		16,688			15,727			961			6.1	%
Income taxes		6,673			6,291			(382	)		(6.1	%)
Net earnings		10,015			9,436			579			6.1	%
Less: Net earnings (loss) attributable to noncontrolling interest		(960	)		(369	)		(591	)		-
Net earnings attributable to Acxiom		10,975			9,805			1,170			11.9	%
Earnings per share:
Basic		0.12			0.12			0.00			0.0	%
Diluted		0.12			0.12			0.00			0.0	%
						��
Earnings per share attributable to Acxiom stockholders:
Basic		0.14			0.12			0.02			16.7	%
Diluted		0.13			0.12			0.01			8.3	%

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ACXIOM CORPORATION AND SUBSIDIARIES
CALCULATION OF EARNINGS PER SHARE
(Unaudited)
(In thousands, except earnings per share)
	For the Three Months Ended
	June 30,		June 30,
	2011		2010
Basic earnings per share:
Numerator - net earnings		10,015		9,436
Denominator - weighted-average shares outstanding		80,942		79,741
Basic earnings per share		0.12		0.12
Diluted earnings per share:
Numerator - net earnings		10,015		9,436
Denominator - weighted-average shares outstanding		80,942		79,741
Dilutive effect of common stock options, warrants and restricted stock		1,072		1,715
		82,014		81,456
Diluted earnings per share		0.12		0.12
Basic earnings per share attributable to Acxiom stockholders:
Numerator - net earnings attributable to Acxiom		10,975		9,805
Denominator - weighted-average shares outstanding		80,942		79,741
Basic earnings per share attributable to Acxiom stockholders		0.14		0.12
Diluted earnings per share attributable to Acxiom stockholders:
Numerator - net earnings attributable to Acxiom		10,975		9,805
Denominator - weighted-average shares outstanding		80,942		79,741
Dilutive effect of common stock options, warrants, and restricted stock		1,072		1,715
		82,014		81,456
Diluted earnings per share attributable to Acxiom stockholders		0.13		0.12

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ACXIOM CORPORATION AND SUBSIDIARIES
RESULTS BY SEGMENT
(Unaudited)
(Dollars in thousands)
	For the Three Months Ended
	June 30,			June 30,
Revenue:	2011			2010
Information services		225,604			210,656
Information products		63,330			59,739
Total revenue		288,934			270,395
Income from operations:
Information services		20,172			20,879
Information products		2,302			1,140
Other		(244	)		57
Total income from operations		22,230			22,076
Margin:
Information services		8.9	%		9.9	%
Information products		3.6	%		1.9	%
Total margin		7.7	%		8.2	%

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ACXIOM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands)
	June 30,			March 31,						$		%
	2011			2011			Variance			Variance
Assets
Current assets:
Cash and cash equivalents		191,094			207,023			(15,929	)		(7.7	%)
Trade accounts receivable, net		180,610			176,654			3,956			2.2	%
Deferred income taxes		12,773			12,480			293			2.3	%
Refundable income taxes		1,900			7,402			(5,502	)		(74.3	%)
Other current assets		64,156			55,691			8,465			15.2	%
Total current assets		450,533			459,250			(8,717	)		(1.9	%)
Property and equipment		899,047			888,717			10,330			1.2	%
Less - accumulated depreciation and amortization		643,618			633,410			10,208			1.6	%
Property and equipment, net		255,429			255,307			122			0.0	%
Software, net of accumulated amortization		22,896			26,412			(3,516	)		(13.3	%)
Goodwill		418,988			417,654			1,334			0.3	%
Purchased software licenses, net of accumulated amortization		36,067			38,583			(2,516	)		(6.5	%)
Deferred costs, net		75,757			81,837			(6,080	)		(7.4	%)
Data acquisition costs		16,976			17,627			(651	)		(3.7	%)
Other assets, net		8,579			9,955			(1,376	)		(13.8	%)
		1,285,225			1,306,625			(21,400	)		(1.6	%)
Liabilities and Stockholders' Equity
Current liabilities:
Current installments of long-term debt		28,112			27,978			(134	)		(0.5	%)
Trade accounts payable		28,999			27,507			(1,492	)		(5.4	%)
Accrued payroll and related expenses		30,893			42,236			11,343			26.9	%
Other accrued expenses		76,831			75,852			(979	)		(1.3	%)
Deferred revenue		57,426			55,921			(1,505	)		(2.7	%)
Total current liabilities		222,261			229,494			7,233			3.2	%
Long-term debt		365,565			394,260			28,695			7.3	%
Deferred income taxes		84,446			84,360			(86	)		(0.1	%)
Other liabilities		6,505			7,478			973			13.0	%
Stockholders' equity:
Common stock		11,879			11,777			102			0.9	%
Additional paid-in capital		842,655			837,439			5,216			0.6	%
Retained earnings		470,071			459,096			10,975			2.4	%
Accumulated other comprehensive income (loss)		18,997			15,991			3,006			18.8	%
Treasury stock, at cost		(742,049	)		(739,125	)		(2,924	)		0.4	%
Total Acxiom stockholders' equity		601,553			585,178			16,375			2.8	%
Noncontrolling interest		4,895			5,855			(960	)		(16.4	%)
Total equity		606,448			591,033			15,415			2.6	%
		1,285,225			1,306,625			(21,400	)		(1.6	%)

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ACXIOM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
	For the Three Months Ended
	June 30,
	2011			2010
Cash flows from operating activities:
Net earnings		10,015			9,436
Non-cash operating activities:
Depreciation and amortization		35,295			35,986
Deferred income taxes		37			1,435
Non-cash stock compensation expense		2,355			2,972
Changes in operating assets and liabilities:
Accounts receivable		(3,622	)		(16,836	)
Other assets		(8,517	)		(1,467	)
Deferred costs		(386	)		(9,981	)
Accounts payable and other liabilities		(3,674	)		(7,121	)
Deferred revenue		1,251			2,564
Net cash provided by operating activities		32,754			16,988
Cash flows from investing activities:
Capitalized software		(529	)		(1,226	)
Capital expenditures		(12,577	)		(8,752	)
Data acquisition costs		(2,776	)		(4,326	)
Payment received from investments		-			175
Net cash paid in acquisitions		(255	)		(1,978	)
Net cash used by investing activities		(16,137	)		(16,107	)
Cash flows from financing activities:
Payments of debt		(32,312	)		(8,964	)
Sale of common stock		39			3,801
Contingent consideration paid for prior acquisitions		(326	)		-
Net cash used by financing activities		(32,599	)		(5,163	)
Effect of exchange rate changes on cash		53			(1,365	)
Net change in cash and cash equivalents		(15,929	)		(5,647	)
Cash and cash equivalents at beginning of period		207,023			224,104
Cash and cash equivalents at end of period		191,094			218,457
Supplemental cash flow information:
Cash paid (received) during the period for:
Interest		5,589			5,780
Income taxes		1,098			3,358
Payments on capital leases and installment payment arrangements		4,794			5,968
Payments on software and data license liabilities		367			893
Other debt payments, excluding line of credit		2,151			2,103
Prepayments of debt		25,000			-
Noncash investing and financing activities:
Acquisition of property and equipment under capital lease
and installment payment arrangements		3,747			10,268

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ACXIOM CORPORATION AND SUBSIDIARIES
CALCULATION OF FREE CASH FLOW AVAILABLE TO EQUITY
AND RECONCILIATION TO OPERATING CASH FLOW
(Unaudited)
(Dollars in thousands)
	06/30/10			09/30/10			12/31/10			03/31/11			FY2011			06/30/11
Net cash provided by operating activities		16,988			42,966			64,230			42,035			166,219			32,754
Plus:
Sale of assets		-			-			-			-			-			-
Less:
Capitalized software		(1,226	)		(1,341	)		(1,025	)		(963	)		(4,555	)		(529	)
Capital expenditures		(8,752	)		(21,734	)		(16,322	)		(12,213	)		(59,021	)		(12,577	)
Data acquisition costs		(4,326	)		(2,625	)		(3,765	)		(2,650	)		(13,366	)		(2,776	)
Payments on capital leases and installment payment arrangements		(5,968	)		(5,411	)		(5,726	)		(5,252	)		(22,357	)		(4,794	)
Payments on software and data license liabilities		(893	)		(164	)		(120	)		(4,139	)		(5,316	)		(367	)
Other required debt payments		(2,103	)		(2,028	)		(2,143	)		(2,154	)		(8,428	)		(2,151	)
Total		(6,280	)		9,663			35,129			14,664			53,176			9,560

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CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except earnings per share)
																			Q1 FY12 to Q1 FY11
	06/30/10			09/30/10			12/31/10			03/31/11			FY2011			06/30/11			%			$
Revenue:
Services		210,656			225,584			232,798			224,556			893,594			225,604			7.1	%		14,948
Products		59,739			66,085			66,312			74,240			266,376			63,330			6.0	%		3,591
Total revenue		270,395			291,669			299,110			298,796			1,159,970			288,934			6.9	%		18,539
Operating costs and expenses:
Cost of revenue
Services		164,650			175,687			178,586			176,065			694,988			180,463			-9.6	%		(15,813	)
Products		45,771			48,320			48,258			47,551			189,900			48,878			-6.8	%		(3,107	)
Total cost of revenue		210,421			224,007			226,844			223,616			884,888			229,341			-9.0	%		(18,920	)
Selling, general and administrative		37,955			40,274			41,331			40,324			159,884			37,119			2.2	%		836
Impairment of goodwill and other intangibles											79,674			79,674			0
Gains, losses and other items, net		(57	)		78			(3,640	)		8,219			4,600			244			-528.1	%		(301	)
Total operating costs and expenses		248,319			264,359			264,535			351,833			1,129,046			266,704			-7.4	%		(18,385	)
Income from operations		22,076			27,310			34,575			(53,037	)		30,924			22,230			0.7	%		154
% Margin		8.2	%		9.4	%		11.6	%		-17.8	%		2.7	%		7.7	%
Other income (expense)
Interest expense		(5,898	)		(6,260	)		(6,006	)		(5,659	)		(23,823	)		(5,455	)		7.5	%		(443	)
Other, net		(451	)		111			(299	)		(827	)		(1,466	)		(87	)		80.7	%		(364	)
Total other income (expense)		(6,349	)		(6,149	)		(6,305	)		(6,486	)		(25,289	)		(5,542	)		12.7	%		(807	)
Earnings before income taxes		15,727			21,161			28,270			(59,523	)		5,635			16,688			6.1	%		961
Income taxes		6,291			8,464			7,856			11,466			34,077			6,673			-6.1	%		(382	)
Net earnings (loss)		9,436			12,697			20,414			(70,989	)		(28,442	)		10,015			6.1	%		579
Less: Net loss attributable
to noncontrolling interest		(369	)		(584	)		(409	)		(3,933	)		(5,295	)		(960	)		160.2	%		(591	)
Net earnings (loss) attributable to Acxiom		9,805			13,281			20,823			(67,056	)		(23,147	)		10,975			11.9	%		1,170
Diluted earnings (loss) per share
attributable to Acxiom shareholders		0.12			0.16			0.25			(0.83	)		(0.29	)		0.13			8.3	%		0.01

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ACXIOM CORPORATION AND SUBSIDIARIES
RESULTS BY SEGMENT
(Unaudited)
(Dollars in thousands)
																			Q1 FY11 to Q1 FY12
	06/30/10			09/30/10			12/31/10			03/31/11			FY2011			06/30/11			%			$
Revenue:
Services		210,656			225,584			232,798			224,556			893,594			225,604			7.1	%		14,948
Products		59,739			66,085			66,312			74,240			266,376			63,330			6.0	%		3,591
Total revenue		270,395			291,669			299,110			298,796			1,159,970			288,934			6.9	%		18,539
Income from operations:
Services		20,879			22,952			26,390			21,181			91,402			20,172			-3.4	%		(707	)
Products		1,140			4,436			4,545			13,675			23,796			2,302			101.9	%		1,162
Other		57			(78	)		3,640			(87,893	)		(84,274	)		(244	)		-528.1	%		(301	)
Total income (loss) from operations		22,076			27,310			34,575			(53,037	)		30,924			22,230			0.7	%		154
Margin:
Services		9.9	%		10.2	%		11.3	%		9.4	%		10.2	%		8.9	%
Products		1.9	%		6.7	%		6.9	%		18.4	%		8.9	%		3.6	%
Total		8.2	%		9.4	%		11.6	%		-17.8	%		2.7	%		7.7	%

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