Acxiom Announces Third-Quarter Financial Results; Record Cash Flow Among Highlights
LITTLE ROCK, Ark., Jan 21, 2004 -- Acxiom(R) Corporation (Nasdaq: ACXM) today announced revenue and earnings results for the third quarter ended December 31, 2003. Revenue and diluted earnings per share were $255.2 million and $.22, respectively. Operating cash flow of $79.3 million and free cash flow of $59.9 million for the quarter represent record cash flow performances for the Company. Acxiom will hold a conference call at 4:30 p.m. CST today to discuss this information further. Interested parties are invited to listen to the call, which will be broadcast via the Internet at www.acxiom.com.
"Our third-quarter revenue, earnings, cash flow and new-business results are all strong," Company Leader Charles D. Morgan said. "And with the building momentum of our new Customer Information Infrastructure (CII) grid-based solution architecture we are establishing a solid foundation for fiscal 2005."
Highlights of Acxiom`s third-quarter performance include:
-- Revenue of $255.2 million and diluted earnings per share of
$.22, which includes a $3 million distribution from the
Montgomery Ward bankruptcy and a loss of $1.4 million related
to investments.
-- Operating cash flow of $79.3 million and free cash flow of
$59.9 million, which are quarterly records for the Company and
the 10th consecutive quarter of strong cash flow performance.
Free cash flow is a non-GAAP financial measure and a
reconciliation to the comparable GAAP measure, operating cash
flow, is attached to this release.
-- New contracts that will deliver $49 million in annual revenue
and renewals that total $14 million in annual revenue.
-- Committed new deals in the pipeline that are expected to
generate $44 million in annual revenue.
-- The acquisition of Claritas Europe was completed effective
January 1, 2004.
-- The completion of a long-term, multi-faceted strategic
alliance with Accenture that is expected to drive new revenue
and improve the efficiency of Acxiom`s services delivery
model.
"Our increased presence in Europe and our new partnership with Accenture represent landmark deals that will help define the future of Acxiom," Morgan said. "Bringing Claritas Europe`s data assets together with Acxiom`s proven services expertise creates an attractive value proposition for the European marketplace. Similarly, Accenture`s strengths and Acxiom`s strengths are very complementary, and combining those strengths should improve bottom-line results for both companies."
Morgan noted that Acxiom expanded its services agreement with JPMorgan Chase in the quarter to include the financial institution`s credit card customer database. Other contracts were completed with blue-chip clients including Equifax in the United Kingdom and AutoNation Inc., Bank One Corporation, IMS Health, Marriott Vacation Club International and Microsoft Corporation in the U.S.
Outlook
The financial projections stated today are based on the Company`s current expectations. These projections are forward looking, and actual results may differ materially. These projections do not include the potential impact of any mergers, acquisitions, divestitures or other business combinations that may be completed in the future.
For the fourth quarter of the 2004 fiscal year, the Company expects:
-- Revenue of $265 million to $270 million, which includes the
Claritas Europe operations.
-- Earnings per share of $.16 to $.18, which includes the
previously announced expected loss of $.02 a share from the
Claritas Europe operations.
-- Operating cash flow in excess of $40 million and free cash
flow in excess of $25 million, which increases the Company`s
fiscal 2004 projection for operating cash flow to more than
$220 million and free cash flow to more than $155 million.
For the fiscal year ending March 31, 2005, the Company estimates revenue of $1.14 billion to $1.19 billion and diluted earnings per share of $.68 to $.70. The Company estimates that it will generate operating cash flow in excess of $200 million and free cash flow in excess of $135 million.
About Acxiom
Acxiom Corporation (Nasdaq: ACXM) integrates data, services and technology to create and deliver customer and information management solutions for many of the largest, most respected companies in the world. The core components of Acxiom`s innovative solutions are Customer Data Integration (CDI) technology, data, database services, IT outsourcing, consulting and analytics, and privacy leadership. Founded in 1969, Acxiom is headquartered in Little Rock, Arkansas, with locations throughout the United States and Europe, and in Australia and Japan.
This release and the scheduled conference call include a discussion of free cash flow, a non-GAAP financial measure. There is a reconciliation of this measure to the comparable GAAP measure, operating cash flow, attached to this press release.
This release and today`s conference call contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially. Such statements include but are not necessarily limited to the following: 1) that the projected revenue, earnings, earnings per share, operating cash flow and free cash flow referred to under the caption "Outlook" above will meet or exceed the estimated amount; 2) that the business pipeline and that our current cost structure will allow us to continue to meet or exceed revenue, earnings and cash flow projections; 3) that new contracts and contract renewals will generate the indicated amounts of revenue; 4) that we have committed new deals in the pipeline that are expected to deliver the indicated amounts; 5) that we are well positioned for success going forward; 6) that future results will be within the indicated ranges; 7) that new products and services will produce the expected results.
The following are important factors, among others, that could cause actual results to differ materially from these forward-looking statements: The possibility that certain contracts may not be closed, or may not be closed within the anticipated time frames; the possibility that certain contracts may not generate the anticipated revenue or profitability; the possibility that negative changes in economic or other conditions might lead to a reduction in demand for our products and services; the possibility that the recovery from the previous three years` economic slowdown may take longer than expected or that economic conditions in general will not be as expected; the possibility that significant customers may experience extreme, severe economic difficulty; 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 sales cycles may lengthen; the possibility that we may not be able to attract and retain qualified technical and leadership associates, or that we may lose key associates to other organizations; the possibility that we won`t be able to properly motivate our sales force or other associates; the possibility that we won`t be able to achieve cost reductions and avoid unanticipated costs; the possibility that we won`t be able to continue to receive credit upon satisfactory terms and conditions; the possibility that competent, competitive products, technologies or services will be introduced into the marketplace by other companies; the possibility that we may be subjected to pricing pressure due to market conditions and/or competitive products and services; the possibility that there will be changes in consumer or business information industries and markets; the possibility that we won`t be able to protect proprietary information and technology or to obtain necessary licenses on commercially reasonable terms; the possibility that we may encounter difficulties when entering new markets or industries; the possibility that there will be changes in the legislative, accounting, regulatory and consumer environments affecting our business, including but not limited to litigation, legislation, regulations and customs relating to our ability to collect, manage, aggregate and use data; the possibility that data suppliers might withdraw data from us, leading to our inability to provide certain products and services; the possibility that we may enter into short-term contracts which would affect the predictability of our revenues; the possibility that the amount of ad hoc, volume-based and project work will not be as expected; the possibility that we may experience a loss of data center capacity or interruption of telecommunication links or power sources; the possibility that postal rates may increase, thereby leading to reduced volumes of business; the possibility that our clients may cancel or modify their agreements with us; the possibility that the services of the United States Postal Service, their global counterparts and other delivery systems may be disrupted; the possibility that the integration of our recently acquired businesses may not be successful; and the possibility that we may be affected by other competitive factors.
With respect to the provision of products or services outside our primary base of operations in the U.S., all of the above factors apply, along with the difficulty of doing business in numerous sovereign jurisdictions due to differences in culture, laws and regulations. Other factors are detailed from time to time in our periodic reports and registration statements filed with the United States Securities and Exchange Commission. We believe that we have the product and technology offerings, facilities, associates and competitive and financial resources for continued business success, but future revenues, costs, margins and profits are all influenced by a number of factors, including those discussed above, all of which are inherently difficult to forecast. 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.
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