Fourth Quarter Revenue Increases 9%
All Segments Post Fourth Quarter Revenue
Growth Led by Connectivity Up 30%
Record Bookings Quarter for Marketing
Services
Repurchases 1.7 Million Shares in the
Quarter
Acxiom® (Nasdaq: ACXM), the data foundation for the world’s
best marketers, today announced financial results for its fourth
quarter and fiscal year ended March 31, 2018.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20180516006285/en/
Fourth Quarter Financial Highlights
- Revenue: Total revenue was $245
million, up 9% compared to the fourth quarter of last year.
- Operating Income (Loss): GAAP
operating income was $5 million compared to an operating loss of $9
million in the prior year. Non-GAAP operating income grew 61% to
$34 million.
- Earnings (Loss) per Share: GAAP
diluted earnings per share were $0.06 compared to a loss per share
of $0.10 in the prior year. Non-GAAP diluted earnings per share
were $0.27 compared to $0.15 a year ago. Current period results
include a $0.02 GAAP tax benefit and $0.03 non-GAAP tax benefit
associated with the recent tax reform legislation.
- Operating Cash Flow: Operating
cash flow was $36 million, up from $31 million in the prior
year.
- Free Cash Flow to Equity: Free
cash flow to equity was $14 million, down from $26 million in the
prior year.
Fiscal Year Financial Highlights
- Revenue: Total revenue was $917
million, up 4% compared to fiscal 2017 driven by 43% year-over-year
growth for Connectivity.
- Operating Income: GAAP operating
income was $11 million compared to $16 million in the prior year.
Non-GAAP operating income grew 25% to $126 million.
- Earnings per Share: GAAP diluted
earnings per share were $0.29 compared to earnings per share of
$0.05 in the prior year. Non-GAAP diluted earnings per share were
$0.94 compared to $0.71 a year ago. Current period results include
a $0.31 GAAP tax benefit and $0.08 non-GAAP tax benefit associated
with the recent tax reform legislation.
- Operating Cash Flow: Operating
cash flow was $112 million, down from $116 million in the prior
year.
- Free Cash Flow to Equity: Free
cash flow to equity was $55 million, down from $63 million in the
comparable period.
Segment Results$M
Connectivity
Q418
Q417
Y/Y Δ
FY18
FY17
Y/Y Δ
Revenue
$ 57 $ 44 30%
$ 211
$ 147 43%
Gross Profit
$ 40 $ 28 45% $ 141 $ 88 60%
Gross Margin
70% 63% 710 bps 67% 60% 690 bps
Segment Operating Income
$ 6 $ 2 295% $ 18 $ 5 245% Segment Margin 10% 3% 690 bps 9% 4% 510
bps
Audience Solutions
Q418 Q417 Y/Y Δ
FY18
FY17 Y/Y Δ
Revenue
$ 88 $ 86 2% $ 327 $ 322 2%
Gross Profit
$ 54 $ 55 (2%) $ 202 $ 198 2% Gross Margin 61% 64% (290 bps) 62%
62% 20 bps
Segment Operating Income
$ 33 $ 34
(2%)
$ 124 $ 123 1% Segment Margin 37% 39% (150 bps) 38% 38% (30 bps)
Marketing Services
Q418 Q417 Y/Y Δ
FY18 FY17 Y/Y Δ
Revenue*
$ 99 $ 94 5% $ 379 $ 411 (8%)
Gross Profit
$ 38 $ 31 21% $ 139 $ 141 (1%) Gross Margin 38% 33% 500 bps 37% 34%
250 bps
Segment Operating Income
$ 20 $ 20 0% $ 83 $ 81 3% Segment Margin 20% 21% (90 bps) 22% 20%
240 bps
*Excluding the divesture of Acxiom Impact,
Marketing Services FY18 revenue was down 3% year-over-year.
A detailed discussion of our non-GAAP financial measures and a
reconciliation between GAAP and non-GAAP results is provided in the
schedules attached to this press release.
Beginning April 1, 2018, the Company will report its results in
two business segments: LiveRamp and Acxiom Marketing Solutions.
“Our fourth quarter performance reflects solid global
execution,” said Acxiom CEO Scott Howe. “LiveRamp® continues to
drive the ubiquity of its identity solution across the open
ecosystem, as evidenced by strong new client adoption, progress
with the people-based programmatic consortium, the launch of
IdentityLink™ for Television and the acceleration of its B2B
efforts. At the same time, Marketing Services had its strongest
bookings quarter in over five years driven by several meaningful
new logo wins.”
“Looking ahead, we are excited about the prospects for both
LiveRamp and Acxiom Marketing Solutions,” continued Howe. “We are
well down the road in looking at potential strategic alternatives
for Acxiom Marketing Solutions and are confident in a successful
outcome that will benefit our clients, partners, associates and
shareholders.”
Recent Business Highlights
- LiveRamp added approximately 30 new
direct clients during the quarter and added several new partner
integrations. Marketers can now onboard and activate their data
across a growing network of 575 publishers and marketing technology
providers.
- LiveRamp acquired Pacific Data
Partners to accelerate its ability to power people-based
business-to-business (B2B) marketing. Pieter De Temmerman and
Grant Ries, co-founders of Pacific Data Partners and former Oracle
and BlueKai veterans, will lead LiveRamp’s efforts to expand
IdentityLink to the world’s largest B2B marketers.
- LiveRamp launched IdentityLink for
Television to transform the world’s largest marketing medium.
For the first time, brands, agencies, programmers and technology
platforms will be able to execute people-based TV media planning,
buying and measurement that is scalable and secure across the TV
ecosystem.
- Marketing Services posted its
largest new bookings quarter in the last five years, driven by
new logo wins with Toyota, Santander Bank and American Life.
- Acxiom was granted six U.S. patents
in fiscal 2018, representing the most patents granted in a
single year in the Company’s history.
- Acxiom repurchased 1.7 million
shares for approximately $49 million during the fourth quarter.
Since March 31, 2018, the Company repurchased an additional 1.9
million shares for approximately $46 million. Since the inception
of its share repurchase program in August 2011, Acxiom has
repurchased a total of 21.9 million shares for $420 million, with
$80 million remaining under the current authorization.
Financial Outlook
Acxiom’s non-GAAP guidance excludes the impact of non-cash stock
compensation, purchased intangible asset amortization,
restructuring charges and strategic evaluation support costs.
For fiscal 2019, Acxiom expects to report:
- Total revenue of between $935 million
and $955 million.
- GAAP loss per share of between $0.23
and $0.18.
- Non-GAAP diluted earnings per share of
between $0.90 and $0.95.
Conference Call
Acxiom will hold a conference call at 4:00 p.m. CT today to
further discuss this information. Interested parties are invited to
listen to the call which will be broadcast via the Internet and can
be found on our investor site. A slide presentation will be
referenced during the call and can be accessed here.
About Acxiom
Acxiom provides the data foundation for the world’s best
marketers. We enable people-based marketing everywhere through a
simple, open approach to connecting systems and data that drives
seamless customer experiences and higher ROI. A leader in identity
and ethical data use for nearly 50 years, Acxiom helps thousands of
clients and partners around the globe work together to create a
world where all marketing is relevant. Acxiom is a registered
trademark of Acxiom Corporation. For more information, visit
Acxiom.com.
Forward-Looking Statements
This release and today’s conference call contain forward-looking
statements including, without limitation, statements regarding
expected levels of revenue and earnings per share. 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 the expected revenue from the divisions may
not be realized within the expected timeframe; the possibility that
our exploration of potential strategic alternatives for Acxiom
Marketing Solutions does not have a successful outcome; the
possibility that the integration of acquired businesses may not be
successful as planned; 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 or cancel 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 purchasers
will reduce their reliance on us by developing and using their own,
or alternative, sources of data generally or with respect to
certain data elements or categories; the possibility that data
suppliers might withdraw data from us, leading to our inability to
provide certain products and services to our clients; 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 anticipated 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 the
European General Data Protection Regulation, which becomes
effective May 25, 2018, will make it more difficult and/or costly
for us to do business in the EU; 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 the possibility
that other risks and uncertainties may emerge, including those
detailed from time to time in our current and 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, 2017, which was filed with the
Securities and Exchange Commission on May 26, 2017.
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.
To automatically receive Acxiom Corporation financial news by
email, please visit www.acxiom.com and subscribe to email
alerts.
Acxiom, LiveRamp, IdentityLink, InfoBase and all other Acxiom
marks contained herein are trademarks or service marks of Acxiom
Corporation. All other marks are the property of their respective
owners.
ACXIOM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Dollars in
thousands, except per share amounts) For the Three
Months Ended March 31, $ % 2018 2017 Variance Variance
Revenues 244,781 224,867 19,914 8.9 % Cost of revenue
121,484 118,294 3,190 2.7 %
Gross profit
123,297 106,573 16,724 15.7 %
% Gross margin 50.4
%
47.4
% Operating expenses: Research and development 23,979
23,478 501 2.1 % Sales and marketing 63,311 48,433 14,878 30.7 %
General and administrative 28,360 37,721 (9,361 ) (24.8 %) Gains,
losses and other items, net 2,852 5,650 (2,798 )
(49.5 %) Total operating expenses 118,502 115,282
3,220 2.8 % Income (loss) from operations 4,795 (8,709 )
13,504 155.1 % %
Margin 2.0 % -3.9
% Other income (expense): Interest expense (2,699 ) (2,137 )
(562 ) (26.3 %) Other, net 302 199 103 51.6 % Total
other expense (2,397 ) (1,937 ) (460 ) (23.7 %) Income
(loss) before income taxes 2,398 (10,646 ) 13,044 122.5 %
Income taxes (2,777 ) (2,565 ) (212 ) (8.3 %) Net earnings
(loss) 5,175 (8,081 ) 13,256 164.0 % Basic earnings
(loss) per share 0.07 (0.10 ) 0.17 170.0 % Diluted
earnings (loss) per share 0.06 (0.10 ) 0.16 160.0 %
Basic weighted average shares 78,614 78,012 Diluted weighted
average shares 81,282 78,012
ACXIOM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF
OPERATIONS (Unaudited) (Dollars in thousands, except per share
amounts) For the Twelve Months Ended March 31, $ %
2018 2017 Variance Variance Revenues 917,406 880,247 37,159
4.2 % Cost of revenue 466,436 477,686 (11,250
) (2.4 %) Gross profit 450,970 402,561 48,409 12.0 %
% Gross
margin 49.2 % 45.7 %
Operating expenses: Research and development 94,873 82,109 12,764
15.5 % Sales and marketing 215,599 166,676 48,923 29.4 % General
and administrative 123,526 129,714 (6,188 ) (4.8 %) Gains, losses
and other items, net 6,373 8,373 (2,000 ) (23.9 %)
Total operating expenses 440,371 386,872 53,499 13.8
% Income from operations 10,599 15,689 (5,090 ) (32.4 %) %
Margin 1.2 % 1.8 % Other income
(expense): Interest expense (10,131 ) (7,381 ) (2,750 ) (37.3 %)
Other, net 241 334 (93 ) (27.8 %) Total other expense
(9,890 ) (7,047 ) (2,843 ) (40.3 %) Income before income
taxes 709 8,642 (7,933 ) (91.8 %) Income taxes (22,771 )
4,534 (27,305 ) (602.2 %) Net earnings 23,480
4,108 19,372 471.6 % Basic earnings per share 0.30
0.05 0.25 500.0 % Diluted earnings per share
0.29 0.05 0.24 480.0 % Basic weighted average
shares 78,891 77,609 Diluted weighted average shares 81,516
79,848 ACXIOM CORPORATION AND
SUBSIDIARIES
RECONCILIATION OF
GAAP TO NON-GAAP EPS (1)
(Unaudited) (Dollars in thousands, except per share amounts)
For the Three Months Ended For the Twelve Months Ended March 31,
March 31, 2018 2017 2018 2017 Earnings (loss) before
income taxes 2,398 (10,646 ) 709 8,642 Income taxes (2,777 )
(2,565 ) (22,771 ) 4,534 Net earnings (loss) 5,175
(8,081 ) 23,480 4,108 Earnings (loss)
per share: Basic 0.07 (0.10 ) 0.30 0.05
Diluted 0.06 (0.10 ) 0.29 0.05
Excluded items: Purchased intangible asset amortization (cost of
revenue) 5,963 6,056 23,920 18,644 Non-cash stock compensation
(cost of revenue and operating expenses) 16,527 15,190 63,234
49,145 Restructuring and merger charges (gains, losses, and other)
2,852 7,321 6,373 10,045 Gain on sale of assets (gains, losses, and
other) - (1,671 ) - (1,671 ) Separation and transformation costs
(general and administrative) 3,070 3,066 20,846 8,639 Accelerated
amortization (cost of revenue) 999 - 999 -
Total excluded items 29,411 29,962
115,372 84,802 Income before income taxes and
excluding items 31,809 19,315 116,081 93,444 Income taxes
(2) 10,045 7,139 39,758 36,652
Non-GAAP net earnings 21,764 12,177 76,323
56,792 Non-GAAP earnings per share: Basic 0.28
0.16 0.97 0.73 Diluted 0.27
0.15 0.94 0.71 Basic weighted
average shares 78,614 78,012 78,891 77,609
Diluted weighted average shares 81,282 80,912
81,516 79,848
(1) This presentation includes non-GAAP
measures. Our non-GAAP measures are not meant to be considered in
isolation or as a substitute for comparable GAAP measures, and
should be read only in conjunction with our condensed consolidated
financial statements prepared in accordance with
GAAP. For a detailed explanation of the adjustments made
to comparable GAAP measures, the reasons why management uses these
measures and the material limitations on the usefulness of these
measures, please see Appendix A.
(2) Income taxes were calculated using an
effective non-GAAP tax rate of 31.6% and 37.0% in the fourth
quarter of fiscal 2018 and 2017, respectively, and 34.3% and 39.2%
for the twelve months ended March 31, 2018
and 2017, respectively. The difference between our GAAP
and non-GAAP tax rates were primarily due to the Tax Cuts and Jobs
Act and net tax effects of the excluded items.
ACXIOM CORPORATION AND
SUBSIDIARIES
RECONCILIATION OF
GAAP TO NON-GAAP INCOME FROM OPERATIONS (1)
(Unaudited) (Dollars in thousands) For the Three Months
Ended For the Twelve Months Ended March 31, March 31, 2018 2017
2018 2017 Income (loss) from operations 4,795 (8,709
) 10,599 15,689 Excluded items: Purchased intangible
asset amortization (cost of revenue) 5,963 6,056 23,920 18,644
Non-cash stock compensation (cost of revenue and operating
expenses) 16,527 15,190 63,234 49,145 Restructuring and merger
charges (gains, losses, and other) 2,852 7,321 6,373 10,045 Gain on
sale of assets (gains, losses and other) - (1,671 ) - (1,671 )
Separation and transformation costs (general and administrative)
3,070 3,066 20,846 8,639 Accelerated amortization (cost of revenue)
999 - 999 - Total excluded items 29,411 29,962
115,372 84,802 Income from operations before
excluded items 34,206 21,253 125,971 100,491
(1) This presentation includes non-GAAP
measures. Our non-GAAP measures are not meant to be considered in
isolation or as a substitute for comparable GAAP measures, and
should be read only in conjunction with our condensed consolidated
financial statements prepared in accordance with
GAAP. For a detailed explanation of the adjustments made
to comparable GAAP measures, the reasons why management uses these
measures and the material limitations on the usefulness of these
measures, please see Appendix A.
ACXIOM CORPORATION AND SUBSIDIARIES
RESULTS BY SEGMENT (Unaudited) (Dollars in thousands)
For the Three Months Ended March 31, $ % 2018 2017
Variance Variance Revenues Marketing Services 98,954 94,269
4,685 5.0 % Audience Solutions 88,374 86,396 1,978 2.3 %
Connectivity 57,453 44,203 13,251 30.0 % Total
operating segment revenues 244,781 224,867 19,914 8.9 %
Gross profit Marketing Services 37,708 31,207 6,501 20.8 % Audience
Solutions 53,883 55,154 (1,271 ) (2.3 %) Connectivity 40,155
27,742 12,413 44.7 % Total operating segment gross profit
131,746 114,104 17,643 15.5 % Gross margin % Marketing
Services 38.1 % 33.1 % Audience Solutions 61.0 % 63.8 %
Connectivity 69.9 % 62.8 % Total operating segment gross margin
53.8 % 50.7 % Income from operations Marketing Services
19,583 19,513 70 0.4 % Audience Solutions 33,041 33,598 (557 ) (1.7
%) Connectivity 5,924 1,502 4,422 294.4 % Total
operating segment income from operations 58,548 54,613 3,935 7.2 %
Operating income margin % Marketing Services 19.8 % 20.7 %
Audience Solutions 37.4 % 38.9 % Connectivity 10.3 % 3.4 % Total
operating segment operating margin 23.9 % 24.3 % Some
totals may not add due to rounding.
ACXIOM CORPORATION AND SUBSIDIARIES RESULTS BY SEGMENT (Unaudited)
(Dollars in thousands) For the Twelve
Months Ended March 31, $ % 2018 2017 Variance Variance
Revenues Marketing Services 379,047 410,840 (31,793 ) (7.7 %)
Audience Solutions 327,358 322,065 5,293 1.6 % Connectivity 211,001
147,342 63,659 43.2 % Total operating segment
revenues 917,406 880,247 37,159 4.2 % Gross profit Marketing
Services 139,185 140,647 (1,462 ) (1.0 %) Audience Solutions
202,235 198,185 4,050 2.0 % Connectivity 140,885 88,251
52,634 59.6 % Total operating segment gross profit 482,305
427,084 55,221 12.9 % Gross margin % Marketing Services 36.7
% 34.2 % Audience Solutions 61.8 % 61.5 % Connectivity 66.8 % 59.9
% Total operating segment gross margin 52.6 % 48.5 % Income
from operations Marketing Services 83,304 80,622 2,682 3.3 %
Audience Solutions 124,192 123,238 954 0.8 % Connectivity 18,399
5,333 13,066 245.0 % Total operating segment income
from operations 225,895 209,193 16,702 8.0 % Operating
income margin % Marketing Services 22.0 % 19.6 % Audience Solutions
37.9 % 38.3 % Connectivity 8.7 % 3.6 % Total operating segment
operating margin 24.6 % 23.8 % Some totals may not
add due to rounding. ACXIOM CORPORATION AND
SUBSIDIARIES RECONCILIATION OF SEGMENT RESULTS (Unaudited) (Dollars
in thousands) For the Three Months Ended For the
Twelve Months Ended March 31, March 31, 2018 2017 2018 2017
Total operating segment gross profit 131,746 114,104 482,305
427,084 Less: Purchased intangible asset amortization 5,963
6,056 23,920 18,644 Non-cash stock compensation 1,487 1,475 6,416
5,879 Accelerated amortization 999 - 999 - Gross
profit 123,297 106,573 450,970 402,561 Total
operating segment income from operations 58,548 54,613 225,895
209,193 Less: Corporate expenses 24,342 33,360 99,924
108,702 Purchased intangible asset amortization 5,963 6,056 23,920
18,644 Non-cash stock compensation 16,527 15,190 63,234 49,145
Restructuring charges 2,852 5,650 6,373 8,374 Separation and
transformation costs 3,070 3,066 20,846 8,639 Accelerated
amortization 999 - 999 - Income (loss) from
operations 4,795 (8,709 ) 10,599 15,689 Some totals
may not add due to rounding.
ACXIOM CORPORATION AND SUBSIDIARIES RECONCILIATION OF ADJUSTED
EBITDA (1) (Unaudited) (Dollars in thousands) For the Three
Months Ended For the Twelve Months Ended March 31, March 31, 2018
2017 2018 2017
Net earnings (loss)
5,175 (8,081 ) 23,480 4,108 Income taxes (2,777 ) (2,565 )
(22,771 ) 4,534 Other expense (2,397 ) (1,937 ) (9,890 )
(7,047 ) Income (loss) from operations 4,795 (8,709 ) 10,599
15,689 Depreciation and amortization 22,652 21,593
86,371 82,690 EBITDA 27,447
12,884 96,970 98,379 Other
adjustments: Non-cash stock compensation (cost of revenue and
operating expenses) 16,527 15,190 63,234 49,145 Restructuring and
merger charges (gains, losses, and other) 2,852 7,321 6,373 10,045
Gain on sale of assets (gains, losses, and other) - (1,671 ) -
(1,671 ) Separation and transformation costs (general and
administrative) 3,070 3,066 20,846 8,639
Other adjustments 22,449 23,906 90,453
66,158 Adjusted EBITDA 49,896 36,790
187,423 164,537
(1) This presentation includes non-GAAP
measures. Our non-GAAP measures are not meant to be considered in
isolation or as a substitute for comparable GAAP measures, and
should be read only in conjunction with our condensed consolidated
financial statements prepared in accordance with GAAP. For a
detailed explanation of the adjustments made to comparable GAAP
measures, the reasons why management uses these measures, the
usefulness of these measures and the material limitations on the
usefulness of these measures, please see Appendix A.
ACXIOM CORPORATION AND SUBSIDIARIES CONSOLIDATED
BALANCE SHEETS (Dollars in thousands)
March 31, March 31, $ % 2018 2017 Variance Variance
Assets
Current assets: Cash and cash equivalents 142,279 170,343 (28,064 )
(16.5 %) Trade accounts receivable, net 167,188 142,768 24,420 17.1
% Refundable income taxes 9,733 7,098 2,635 37.1 % Other current
assets 41,145 48,310 (7,165 ) (14.8 %) Total
current assets 360,345 368,519 (8,174 ) (2.2 %)
Property and equipment 491,266 476,281 14,985 3.1 % Less -
accumulated depreciation and amortization 334,733 320,307
14,426 4.5 % Property and equipment, net 156,533
155,974 559 0.4 % Software, net of accumulated
amortization 34,984 47,638 (12,654 ) (26.6 %) Goodwill 595,995
592,731 3,264 0.6 % Purchased software licenses, net of accumulated
amortization 7,703 7,972 (269 ) (3.4 %) Deferred income taxes
12,225 10,261 1,964 19.1 % Other assets, net 41,468 51,443
(9,975 ) (19.4 %) 1,209,253 1,234,538
(25,285 ) (2.0 %)
Liabilities and
Stockholders' Equity
Current liabilities: Current installments of long-term debt 1,583
39,819 (38,236 ) (96.0 %) Trade accounts payable 46,688 40,208
6,480 16.1 % Accrued payroll and related expenses 42,499 53,238
(10,739 ) (20.2 %) Other accrued expenses 55,865 59,861 (3,996 )
(6.7 %) Deferred revenue 31,720 37,087 (5,367 ) (14.5
%) Total current liabilities 178,355 230,213
(51,858 ) (22.5 %) Long-term debt 227,837 189,241 38,596
20.4 % Deferred income taxes 40,243 58,374 (18,131 ) (31.1
%) Other liabilities 13,723 17,730 (4,007 ) (22.6 %)
Stockholders' equity: Common stock 13,609 13,288 321 2.4 %
Additional paid-in capital 1,235,679 1,154,429 81,250 7.0 %
Retained earnings 628,331 602,609 25,722 4.3 % Accumulated other
comprehensive income 10,767 7,999 2,768 34.6 % Treasury stock, at
cost (1,139,291 ) (1,039,345 ) (99,946 ) (9.6 %) Total
stockholders' equity 749,095 738,980 10,115 1.4 %
1,209,253 1,234,538 (25,285 ) (2.0 %)
ACXIOM CORPORATION AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited) (Dollars in thousands)
For the Three Months Ended March 31, 2018 2017 Cash flows
from operating activities: Net earnings (loss) 5,175 (8,081 )
Non-cash operating activities: Depreciation and amortization 22,652
21,593 Loss on disposal or impairment of assets 702 3,560 Deferred
income taxes 356 (6,836 ) Non-cash stock compensation expense
16,527 15,201 Changes in operating assets and liabilities: Accounts
receivable (10,568 ) (5,000 ) Other assets (3,463 ) (8,825 )
Accounts payable and other liabilities 6,994 16,110 Deferred
revenue (2,613 ) 2,943 Net cash provided by operating
activities 35,762 30,665 Cash flows from investing
activities: Capitalized software (3,407 ) (3,306 ) Capital
expenditures (17,247 ) (17,897 ) Data acquisition costs (286 ) (418
) Proceeds from sale of assets - 25,494 Equity investments - (1,000
) Net cash paid in acquisitions (4,478 ) - Net cash provided
by (used in) investing activities (25,418 ) 2,873 Cash flows
from financing activities: Payments of debt (588 ) (8,070 ) Sale of
common stock, net of stock acquired for withholding taxes 3,558
6,039 Excess tax benefits from stock-based compensation - 1,067
Acquisition of treasury stock (49,443 ) - Net cash used in
financing activities (46,473 ) (964 ) Effect of exchange rate
changes on cash 601 (81 ) Net change in cash and cash
equivalents (35,528 ) 32,493 Cash and cash equivalents at beginning
of period 177,807 137,850 Cash and cash equivalents
at end of period 142,279 170,343
Supplemental cash flow information: Cash paid during the
period for: Interest 2,457 2,478 Income taxes 84 2,070
ACXIOM CORPORATION AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited) (Dollars in thousands)
For the Twelve Months Ended March 31, 2018 2017 Cash flows
from operating activities: Net earnings 23,480 4,108 Non-cash
operating activities: Depreciation and amortization 86,371 82,690
Loss on disposal or impairment of assets 3,348 3,040 Write-off of
debt issuance costs 720 - Deferred income taxes (20,095 ) (8,818 )
Non-cash stock compensation expense 63,234 49,145 Changes in
operating assets and liabilities: Accounts receivable (22,000 )
(11,161 ) Other assets (4,740 ) (172 ) Accounts payable and other
liabilities (11,238 ) 4,302 Deferred revenue (6,927 ) (7,304 ) Net
cash provided by operating activities 112,153 115,830
Cash flows from investing activities: Capitalized software (13,739
) (14,477 ) Capital expenditures (44,197 ) (47,993 ) Data
acquisition costs (907 ) (881 ) Equity investments (1,000 ) (1,000
) Net cash received in disposition 4,000 16,988 Proceeds from sale
of assets - 25,494 Net cash paid in acquisitions (4,478 ) (137,383
) Net cash used in investing activities (60,321 ) (159,252 ) Cash
flows from financing activities: Proceeds from debt 230,000 70,000
Payments of debt (227,320 ) (32,243 ) Debt issuance costs (4,001 )
- Sale of common stock, net of stock acquired for withholding taxes
8,665 15,709 Excess tax benefits from stock-based compensation -
2,852 Acquisition of treasury stock (88,884 ) (30,542 ) Net cash
provided by (used in) financing activities (81,540 ) 25,776
Effect of exchange rate changes on cash 1,644 (1,640 )
Net change in cash and cash equivalents (28,064 ) (19,286 )
Cash and cash equivalents at beginning of period 170,343
189,629 Cash and cash equivalents at end of period 142,279
170,343
Supplemental cash flow
information: Cash paid during the period for: Interest 9,169
7,779 Income taxes 1,236 6,866 Noncash investing and
financing activities: Leasehold improvements paid directly by
lessor 978 -
ACXIOM CORPORATION AND
SUBSIDIARIES CALCULATION OF FREE CASH FLOW TO EQUITY (1)
(Unaudited) (Dollars in thousands) 06/30/16
09/30/16 12/31/16 03/31/17 FY2017
06/30/17 09/30/17 12/31/17 03/31/18
FY2018 Net Cash Provided by Operating Activities 750 35,482
48,933 30,665 115,830 4,951 27,810 43,630 35,762 112,153
Less (plus): Capitalized software (3,982 ) (3,893 ) (3,296 ) (3,306
) (14,477 ) (3,388 ) (3,756 ) (3,188 ) (3,407 ) (13,739 ) Capital
expenditures (10,694 ) (9,845 ) (9,557 ) (17,897 ) (47,993 ) (6,888
) (7,630 ) (12,432 ) (17,247 ) (44,197 ) Data acquisition costs (20
) (247 ) (196 ) (418 ) (881 ) (190 ) (233 ) (198 ) (286 ) (907 )
Required debt payments (8,053 ) (8,058 ) (8,062 ) (8,070 ) (32,243
) (572 ) (578 ) (582 ) (588 ) (2,320 ) Net cash received in
disposition - 16,988 - - 16,988 - 4,000 - - 4,000 Proceeds from
sales of assets - - -
25,494 25,494 - -
- - - Free Cash Flow to
Equity (21,999 ) 30,427 27,822
26,468 62,718 (6,087 ) 19,613
27,230 14,234 54,990
(1) This presentation includes non-GAAP
measures. Our non-GAAP measures are not meant to be considered in
isolation or as a substitute for comparable GAAP measures, and
should be read only in conjunction with our condensed consolidated
financial statements prepared in accordance with GAAP. For a
detailed explanation of the adjustments made to comparable GAAP
measures, the reasons why management uses these measures, the
usefulness of these measures and the material limitations on the
usefulness of these measures, please see Appendix A.
ACXIOM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Dollars in
thousands, except per share amounts)
Q4 FY18 to Q4 FY17 06/30/16 09/30/16
12/31/16 03/31/17 FY2017 06/30/17
09/30/17 12/31/17 03/31/18 FY2018 % $
Revenues 214,801 217,267 223,312 224,867 880,247 212,514 225,240
234,871 244,781 917,406 8.9 % 19,914 Cost of revenue 122,819
120,105 116,468 118,294
477,686 113,960 115,072
115,920 121,484 466,436
2.7 % 3,190 Gross profit 91,982 97,162 106,844 106,573 402,561
98,554 110,168 118,951 123,297 450,970 15.7 % 16,724
% Gross
margin 42.8 % 44.7 % 47.8
% 47.4 % 45.7 % 46.4
% 48.9 % 50.6 % 50.4
% 49.2 % Operating expenses Research
and development 18,652 19,029 20,950 23,478 82,109 23,563 24,013
23,318 23,979 94,873 2.1 % 501 Sales and marketing 37,348 37,847
43,048 48,433 166,676 48,440 50,118 53,730 63,311 215,599 30.7 %
14,878 General and administrative 27,506 32,866 31,620 37,721
129,714 32,356 31,924 30,886 28,360 123,526 -24.8 % (9,361 ) Gains,
losses and other items, net 314 300
2,111 5,650 8,373 (98 )
3,660 (41 ) 2,852 6,373
-49.5 % (2,798 ) Total operating expenses 83,820 90,042 97,729
115,282 386,872 104,261 109,715 107,893 118,502 440,371 2.8 % 3,221
Income (loss) from operations 8,162 7,120 9,115 (8,709 )
15,689 (5,707 ) 453 11,058 4,795 10,599 155.1 % 13,504
%
Margin 3.8 % 3.3 % 4.1
% -3.9 % 1.8 % -2.7
% 0.2 % 4.7 % 2.0
% 1.2 % Other income (expense) Interest
expense (1,812 ) (1,689 ) (1,743 ) (2,137 ) (7,381 ) (2,342 )
(2,524 ) (2,566 ) (2,699 ) (10,131 ) -26.3 % (562 ) Other, net 307
(207 ) 35 199 334
(672 ) 192 419 302
241 51.7 % 103 Total other expense (1,505 ) (1,896 )
(1,708 ) (1,937 ) (7,047 ) (3,014 ) (2,332 ) (2,147 ) (2,397 )
(9,890 ) -23.7 % (460 ) Income (loss) before income taxes
6,657 5,224 7,407 (10,646 ) 8,642 (8,721 ) (1,879 ) 8,911 2,398 709
122.5 % 13,044 Income taxes 2,681 (1,916 )
6,334 (2,565 ) 4,534 (7,421 )
1,457 (14,030 ) (2,777 ) (22,771 ) -8.3
% (212 ) Net earnings (loss) 3,976 7,140 1,073 (8,081 )
4,108 (1,300 ) (3,336 ) 22,941 5,175 23,480 164.0 % 13,256
Diluted earnings (loss) per share 0.05 0.09
0.01 (0.10 ) 0.05 (0.02 )
(0.04 ) 0.28 0.06 0.29
161.5 % 0.17 Some earnings (loss) per share amounts may not
add due to rounding. Basic shares 77,471 77,446 77,507
78,012 77,609 78,672 79,235 79,043 78,614 78,891 Diluted shares
79,353 79,277 79,851 80,912 79,848 81,440 81,472 81,869 81,282
81,516
ACXIOM CORPORATION AND SUBSIDIARIES
RECONCILIATION OF GAAP TO NON-GAAP EPS (1) (Unaudited) (Dollars in
thousands, except per share amounts)
06/30/16 09/30/16
12/31/16 03/31/17 FY2017 06/30/17 09/30/17
12/31/17 03/31/18 FY2018
Earnings (loss) before income taxes 6,657 5,224 7,407 (10,646 )
8,642 (8,721 ) (1,879 ) 8,911 2,398 709 Income taxes 2,681
(1,916 ) 6,334 (2,565 ) 4,534
(7,421 ) 1,457 (14,030 ) (2,777 )
(22,771 ) Net earnings (loss) 3,976 7,140
1,073 (8,081 ) 4,108 (1,300 )
(3,336 ) 22,941 5,175
23,480 Earnings (loss) per share: Basic 0.05
0.09 0.01 (0.10 ) 0.05
(0.02 ) (0.04 ) 0.29 0.07
0.30 Diluted 0.05 0.09 0.01
(0.10 ) 0.05 (0.02 ) (0.04 )
0.28 0.06 0.29 Excluded
items:
Purchased intangible asset amortization
(cost of revenue)
4,077 3,890 4,621 6,056 18,644 5,966 6,021 5,971 5,963 23,920
Non-cash stock compensation (cost of revenue and operating
expenses) 8,590 11,938 13,427 15,190 49,145 15,031 15,757 15,919
16,527 63,234 Restructuring and merger charges (gains, losses, and
other) 314 300 2,111 7,321 10,045 (98 ) 3,660 (41 ) 2,852 6,373
Gain on sales of assets (gains, losses and other) - - - (1,671 )
(1,671 ) - - - - - Separation and transformation costs (general and
administrative) - 1,455 4,118 3,066 8,639 7,119 5,442 5,214 3,070
20,846 Accelerated amortization (cost of revenue) - -
- - - - -
- 999 999 Total
excluded items 12,981 17,583 24,277
29,962 84,802 28,018 30,880
27,063 29,411 115,372
Income before income taxes and excluding
items
19,638 22,807 31,683 19,315 93,444 19,297 29,001 35,974 31,809
116,081 Income taxes 7,852 8,910 12,751
7,139 36,652 7,720 11,289
10,704 10,045 39,758
Non-GAAP net earnings 11,786 13,897
18,932 12,177 56,792 11,577
17,712 25,270 21,764
76,323 Non-GAAP earnings per share:
Basic 0.15 0.18 0.24 0.16
0.73 0.15 0.22 0.32
0.28 0.97 Diluted 0.15
0.18 0.24 0.15 0.71
0.14 0.22 0.31
0.27 0.94 Basic weighted average shares
77,471 77,446 77,507 78,012
77,609 78,672 79,235
79,043 78,614 78,891
Diluted weighted average shares 79,353 79,277
79,851 80,912 79,848 81,440
81,472 81,869 81,282
81,516 Some totals may not add due to rounding
(1) This presentation includes non-GAAP
measures. Our non-GAAP measures are not meant to be considered in
isolation or as a substitute for comparable GAAP measures, and
should be read only in conjunction with our condensed consolidated
financial statements prepared in accordance with
GAAP. For a detailed explanation of the adjustments made
to comparable GAAP measures, the reasons why management uses these
measures and the material limitations on the usefulness of these
measures, please see Appendix A.
ACXIOM CORPORATION AND SUBSIDIARIES RESULTS BY
SEGMENT (Unaudited) (Dollars in thousands)
Q4 FY18 to Q4 FY17 06/30/16 09/30/16
12/31/16 03/31/17 FY2017 06/30/17 09/30/17
12/31/17 03/31/18 FY2018 % $
Revenues: Marketing Services 109,715 105,679 101,177
94,269 410,840 91,594 94,042 94,457 98,954 379,047 5.0 % 4,685
Audience Solutions 73,744 78,526 83,399 86,396 322,065 75,734
78,814 84,436 88,374 327,358 2.3 % 1,978 Connectivity 31,342
33,062 38,736 44,203
147,342 45,186 52,384
55,978 57,453 211,001 30.0 %
13,250 Total operating segment revenues 214,801
217,267 223,312 224,867
880,247 212,514 225,240
234,871 244,781 917,406 8.9 %
19,914 Gross profit: Marketing Services 37,466 34,480
37,494 31,207 140,647 31,358 34,320 35,798 37,708 139,185 20.8 %
6,501 Audience Solutions 41,912 47,998 53,120 55,154 198,185 47,210
48,321 52,821 53,883 202,235 (2.3 %) (1,271 ) Connectivity 17,575
19,843 23,091 27,742
88,251 27,525 35,291
37,914 40,155 140,885
44.7 % 12,413 Total operating segment gross profit 96,953
102,321 113,705 114,104
427,084 106,093 117,932
126,533 131,746 482,305
15.5 % 17,642 Gross margin %: Marketing Services 34.1
% 32.6 % 37.1 % 33.1 % 34.2 % 34.2 % 36.5 % 37.9 % 38.1 % 36.7 %
Audience Solutions 56.8 % 61.1 % 63.7 % 63.8 % 61.5 % 62.3 % 61.3 %
62.6 % 61.0 % 61.8 % Connectivity 56.1 % 60.0 % 59.6 % 62.8 % 59.9
% 60.9 % 67.4 % 67.7 % 69.9 % 66.8 % Total operating segment
gross margin 45.1 % 47.1 % 50.9 % 50.7 % 48.5 % 49.9 % 52.4 % 53.9
% 53.8 % 52.6 % Income (loss) from operations:
Marketing Services 20,145 19,837 21,127 19,513 80,622 19,784 21,874
22,063 19,583 83,304 0.4 % 70 Audience Solutions 25,096 29,972
34,572 33,598 123,238 28,542 29,497 33,112 33,041 124,192 (1.7 %)
(557 ) Connectivity 291 1,663 1,877
1,502 5,333 (48 ) 5,715
6,808 5,924 18,399
294.4 % 4,422 Total operating segment income from operations
45,532 51,472 57,576
54,613 209,193 48,277 57,086
61,983 58,548 225,895
7.2 % 3,935 Operating income (loss) margin %:
Marketing Services 18.4 % 18.8 % 20.9 % 20.7 % 19.6 % 21.6 % 23.3 %
23.4 % 19.8 % 22.0 % Audience Solutions 34.0 % 38.2 % 41.5 % 38.9 %
38.3 % 37.7 % 37.4 % 39.2 % 37.4 % 37.9 % Connectivity 0.9 % 5.0 %
4.8 % 3.4 % 3.6 % -0.1 % 10.9 % 12.2 % 10.3 % 8.7 % Total
operating segment operating margin 21.2 % 23.7 % 25.8 % 24.3 % 23.8
% 22.7 % 25.3 % 26.4 % 23.9 % 24.6 % Some totals may not add
due to rounding. ACXIOM CORPORATION AND
SUBSIDIARIES
RECONCILIATION OF
GAAP TO NON-GAAP EPS GUIDANCE (1)
(Unaudited) (Dollars in thousands, except per share amounts)
For the year ending March 31, 2019 Low Range High
Range Loss before income taxes (15,500 ) (10,000 )
Income taxes 3,000 4,500 Net
loss (18,500 ) (14,500 ) Diluted loss per
share
$
(0.23
) $ (0.18 ) Excluded items: Purchased intangible asset
amortization 16,000 16,000 Non-cash stock compensation 84,000
84,000 Gains, losses and other items, net 3,000 3,000 Separation
and related costs 16,000 16,000
Total excluded items 119,000 119,000
Income before income taxes and excluding items 103,500
109,000 Income taxes (2) 29,000 30,500
Non-GAAP net earnings 74,500
78,500 Non-GAAP diluted earnings per share $ 0.90
$ 0.95 Basic weighted average shares 81,000
81,000 Diluted weighted average shares 83,000 83,000
(1) This presentation includes non-GAAP
measures. Our non-GAAP measures are not meant to be considered in
isolation or as a substitute for comparable GAAP
measures, and should be read only in conjunction with our condensed
consolidated financial statements prepared in accordance with GAAP.
For a detailed explanation of the adjustments made to comparable
GAAP measures, the reasons why management uses these measures, the
usefulness of these measures and the material limitations on the
usefulness of these measures, please see Appendix A.
(2) Income taxes were
calculated using an effective non-GAAP tax rate of approximately
28.0%. The difference between our GAAP and Non-GAAP tax
rates was due to the effect of excluded items.
APPENDIX A
ACXIOM CORPORATIONQ4 FISCAL 2018 FINANCIAL
RESULTSEXPLANATION OF NON-GAAP MEASURES
To supplement our financial results, we use non-GAAP measures
which exclude certain acquisition related expenses, non-cash stock
compensation and restructuring charges. We believe these measures
are helpful in understanding our past performance and our future
results. Our non-GAAP financial measures and schedules are not
meant to be considered in isolation or as a substitute for
comparable GAAP measures and should be read only in conjunction
with our consolidated GAAP financial statements. Our management
regularly uses these non-GAAP financial measures internally to
understand, manage and evaluate our business and to make operating
decisions. These measures are among the primary factors management
uses in planning for and forecasting future periods. Compensation
of our executives is also based in part on the performance of our
business based on these non-GAAP measures.
Our non-GAAP financial measures, including non-GAAP earnings per
share, income from operations and adjusted EBITDA reflect
adjustments based on the following items, as well as the related
income tax effects when applicable:
Purchased intangible asset
amortization: We incur amortization of purchased intangibles
in connection with our acquisitions. Purchased intangibles include
(i) developed technology, (ii) customer and publisher
relationships, and (iii) trade names. We expect to amortize for
accounting purposes the fair value of the purchased intangibles
based on the pattern in which the economic benefits of the
intangible assets will be consumed as revenue is generated.
Although the intangible assets generate revenue for us, we exclude
this item because this expense is non-cash in nature and because we
believe the non-GAAP financial measures excluding this item provide
meaningful supplemental information regarding our operational
performance.
Non-cash stock compensation:
Non-cash stock compensation consists of charges for associate
restricted stock units, performance shares and stock options in
accordance with current GAAP related to stock-based compensation
including expense associated with stock-based compensation related
to unvested options assumed in connection with our acquisitions. As
we apply stock-based compensation standards, we believe that it is
useful to investors to understand the impact of the application of
these standards to our operational performance. Although
stock-based compensation expense is calculated in accordance with
current GAAP and constitutes an ongoing and recurring expense, such
expense is excluded from non-GAAP results because it is not an
expense that typically requires or will require cash settlement by
us and because such expense is not used by us to assess the core
profitability of our business operations.
Restructuring charges: During the
past several years, we have initiated certain restructuring
activities in order to align our costs in connection with both our
operating plans and our business strategies based on then-current
economic conditions. As a result, we recognized costs related to
termination benefits for associates whose positions were
eliminated, lease termination charges, and leasehold improvement
write offs. These items, reported as gains, losses, and other
items, net, are excluded from non-GAAP results because such amounts
are not used by us to assess the core profitability of our business
operations.
Separation and transformation
costs: In previous years, we incurred significant expenses
in connection with the separation of our IT Infrastructure
Management (“ITO”) and the subsequent transformation of our
remaining operating segments. This work enabled us to transform our
external reporting and provide investors with enhanced transparency
and more granular segment-level disclosures in addition to
facilitating the ITO disposition. In the prior and current year, we
are incurring expenses to further separate the financial statements
of our three operating segments, with particular focus on
segment-level balance sheets, and to evaluate portfolio priorities.
Our criteria for excluding separation and transformation expenses
from our non-GAAP measures is as follows: 1) projects are discrete
in nature; 2) excluded expenses consist only of third-party
consulting fees that we would not incur otherwise; and 3) we do not
exclude employee related expenses or other costs associated with
the ongoing operations of our business. We substantially completed
these projects during the third quarter of fiscal year 2018.
Beginning in the fourth quarter of fiscal 2018, we incurred
transaction analysis and support expenses related to the Company’s
announced evaluation of strategic options for its Marketing
Solutions business. Our criteria for excluding these transaction
related costs are the same. We believe excluding these items from
our non-GAAP financial measures is useful for investors and
provides meaningful supplemental information.
Our non-GAAP financial schedules are:
Non-GAAP EPS and Non-GAAP Income from
Operations: Our non-GAAP earnings per share and Non-GAAP
income from operations reflect adjustments as described above, as
well as the related tax effects where applicable.
Adjusted EBITDA: Adjusted EBITDA is
defined as net income from continuing operations before income
taxes, other expenses, depreciation and amortization, and including
adjustments as described above. We use Adjusted EBITDA to measure
our performance from period to period both at the consolidated
level as well as within our operating segments and to compare our
results to those of our competitors. We believe that the inclusion
of Adjusted EBITDA provides useful supplementary information to and
facilitates analysis by investors in evaluating the Company’s
performance and trends. The presentation of Adjusted EBITDA is not
meant to be considered in isolation or as an alternative to net
earnings as an indicator of our performance.
Free Cash Flow to Equity: To
supplement our statement of cash flows, we use a non-GAAP measure
of cash flow to analyze cash flows generated from operations. Free
cash flow to equity is defined as operating cash flow less cash
used by investing activities (excluding the impact of cash paid in
acquisitions), less required payments of debt, and excluding the
impact of discontinued operations. Management believes that this
measure of cash flow is meaningful since it represents the amount
of money available from continuing operations for the Company’s
discretionary spending after funding all required obligations
including scheduled debt payments. The presentation of non-GAAP
free cash flow to equity is not meant to be considered in isolation
or as an alternative to cash flows from operating activities as a
measure of liquidity.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20180516006285/en/
Acxiom Investor RelationsLauren Dillard,
650-372-2242investor.relations@acxiom.comEACXM
Acxiom (NASDAQ:ACXM)
Historical Stock Chart
From Sep 2024 to Oct 2024
Acxiom (NASDAQ:ACXM)
Historical Stock Chart
From Oct 2023 to Oct 2024