Acxiom Announces Third Quarter Results

  Acxiom Announces Third Quarter Results

            U.S. marketing and data services revenue up 4 percent

Business Wire

LITTLE ROCK, Ark. -- January 30, 2013

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          190,138       187,461       2,677        1.4    %
services
IT Infrastructure           69,916        77,173        (7,257 )     (9.4   %)
management services
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        37,303        36,318        (985   )     (2.7   %)
administrative
Impairment of goodwill      -             17,803        17,803       100.0  %
and other intangibles
Gains, losses and other     (126    )     (2,671  )     2,545        95.3   %
items, net
                                                                     
Total operating costs       246,204      265,375      19,171       7.2    %
and expenses
                                                                     
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          (2,613  )     (3,981  )     1,368        34.4   %
(expense)
                                                                     
Earnings from
continuing operations       24,285        11,537        12,748       110.5  %
before income taxes
                                                                     
Income taxes                9,836        9,700        (136   )     (1.4   %)
                                                                     
Net earnings from           14,449        1,837         12,612       686.6  %
continuing operations
                                                                     
Earnings from
discontinued                -            814          (814   )     (100.0 %)
operations, net of tax
                                                                     
Net earnings                14,449        2,651         11,798       445.0  %
                                                                     
Less: Net loss
attributable to             (76     )     (5,279  )     5,203        98.6   %
noncontrolling interest
                                                                     
Net earnings                14,525       7,930        6,595        83.2   %
attributable to Acxiom
                                                                     
Basic earnings per
share:
Net earnings from           0.19          0.02          0.17         850.0  %
continuing operations
Earnings from               0.00         0.01         (0.01  )     (100.0 %)
discontinued operations
Net earnings                0.19         0.03         0.16         533.3  %
                                                                     
Net earnings
attributable to Acxiom      0.20         0.10         0.10         100.0  %
stockholders
                                                                     
                                                                     
Diluted earnings per
share:
Net earnings from           0.19          0.02          0.17         850.0  %
continuing operations
Earnings from               0.00         0.01         (0.01  )     (100.0 %)
discontinued operations
Net earnings                0.19         0.03         0.16         533.3  %
                                                                     
Net earnings
attributable to Acxiom      0.19         0.10         0.09         90.0   %
stockholders
                                                                            

                                                            
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         570,286       568,314       1,972         0.3    %
services
IT Infrastructure          210,267       223,935       (13,668 )     (6.1   %)
management services
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       111,393       112,554       1,161         1.0    %
administrative
Impairment of goodwill     -             17,803        17,803        100.0  %
and other intangibles
Gains, losses and          66           38           (28     )     (73.7  %)
other items, net
                                                                     
Total operating costs      739,698      780,096      40,398        5.2    %
and expenses
                                                                     
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         (9,771  )     (15,207 )     5,436         35.7   %
(expense)
                                                                     
Earnings from
continuing operations      72,759        48,066        24,693        51.4   %
before income taxes
                                                                     
Income taxes               28,739       25,291       (3,448  )     (13.6  %)
                                                                     
Net earnings from          44,020        22,775        21,245        93.3   %
continuing operations
                                                                     
Earnings from
discontinued               -            2,868        (2,868  )     (100.0 %)
operations, net of tax
                                                                     
Net earnings               44,020        25,643        18,377        71.7   %
                                                                     
Less: Net loss
attributable to            (349    )     (5,554  )     5,205         93.7   %
noncontrolling
interest
                                                                     
Net earnings               44,369       31,197       13,172        42.2   %
attributable to Acxiom
                                                                     
Basic earnings per
share:
Net earnings from          0.59          0.28          0.31          110.7  %
continuing operations
Earnings from
discontinued               0.00         0.04         (0.04   )     (100.0 %)
operations
Net earnings               0.59         0.32         0.27          84.4   %
                                                                     
Net earnings
attributable to Acxiom     0.59         0.39         0.20          51.3   %
stockholders
                                                                     
                                                                     
Diluted earnings per
share:
Net earnings from          0.57          0.28          0.29          103.6  %
continuing operations
Earnings from
discontinued               0.00         0.04         (0.04   )     (100.0 %)
operations
Net earnings               0.57         0.32         0.25          78.1   %
                                                                     
Net earnings
attributable to Acxiom     0.58         0.39         0.19          48.7   %
stockholders
                                                                            

                                                            
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            24,285           11,537        72,759           48,066
operations before
income taxes
                                                                      
Income taxes          9,836           9,700        28,739          25,291 
                                                                      
Net earnings from
continuing            14,449           1,837         44,020           22,775
operations
                                                                      
Earnings from
discontinued          -               814          -               2,868  
operations, net
of tax
                                                                      
Net earnings          14,449           2,651         44,020           25,643
                                                                      
Less: Net
earnings (loss)
attributable to       (76     )        (5,279  )     (349    )        (5,554 )
noncontrolling
interest
                                                                      
Net earnings
attributable to       14,525          7,930        44,369          31,197 
Acxiom
                                                                      
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          -                17,803        -                17,803
other intangibles
Adjustment of         -                (2,598  )     -                (2,598 )
earnout liability
Other adjustments     (126    )        (73     )     66              124    
                                                                      
Total unusual         (126    )        15,132       66              17,841 
items
                                                                      
Earnings from
continuing
operations before
income taxes
and excluding         24,159           26,669        72,825           65,907
unusual items
                                                                      
Income taxes          9,760           10,649       28,764          26,341 
                                                                      
Non-GAAP earnings
from continuing       14,399           16,020        44,061           39,566
operations
                                                                      
Earnings from
discontinued          -               814          -               2,868  
operations, net
of tax
                                                                      
Non-GAAP net          14,399           16,834        44,061           42,434
earnings
                                                                      
Less: Net
earnings (loss)
attributable to       (76     )        (231    )     (349    )        (1,371 )
noncontrolling
interest
                                                                      
Non-GAAP Net
earnings              14,475          17,065       44,410          43,805 
attributable to
Acxiom
                                                                      
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      75,878          79,020       76,987          80,877 
average shares
                                                                             

                                                           
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           26,898             15,518      82,530           63,273
operations
                                                                      
Unusual items         (126     )         15,132      66               17,841
                                                                      
Income from
operations before     26,772            30,650      82,596           81,114
unusual items
                                                                      

                                                             
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            74,103           78,189
outstanding
Basic earnings per share                         0.19             0.02
                                                                  
Basic earnings per share - net earnings
attributable to Acxiom stockholders:
Numerator - net earnings attributable to         14,525           7,930
Acxiom
Denominator - weighted-average shares            74,103           78,189
outstanding
Basic earnings per share - net earnings          0.20             0.10
attributable to Acxiom stockholders
                                                                  
Diluted earnings per share from continuing
operations:
Numerator - net earnings                         14,449           1,837
Denominator - weighted-average shares            74,103           78,189
outstanding
Dilutive effect of common stock options,         1,775            831
warrants and restricted stock
                                                 75,878           79,020
                                                                  
Diluted earnings per share from continuing       0.19             0.02
operations
                                                                  
Diluted earnings per share - net earnings
attributable to Acxiom stockholders:
Numerator - net earnings attributable to         14,525           7,930
Acxiom
Denominator - weighted-average shares            74,103           78,189
outstanding
Dilutive effect of common stock options,         1,775            831
warrants, and restricted stock
                                                 75,878           79,020
                                                                  
Diluted earnings per share - net earnings        0.19             0.10
attributable to Acxiom stockholders
                                                                  

                                                             
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            75,195           80,039
outstanding
Basic earnings per share                         0.59             0.28
                                                                  
Basic earnings per share - net earnings
attributable to Acxiom stockholders:
Numerator - net earnings attributable to         44,369           31,197
Acxiom
Denominator - weighted-average shares            75,195           80,039
outstanding
Basic earnings per share - net earnings          0.59             0.39
attributable to Acxiom stockholders
                                                                  
Diluted earnings per share from continuing
operations:
Numerator - net earnings                         44,020           22,775
Denominator - weighted-average shares            75,195           80,039
outstanding
Dilutive effect of common stock options,         1,792            838
warrants and restricted stock
                                                 76,987           80,877
                                                                  
Diluted earnings per share from continuing       0.57             0.28
operations
                                                                  
Diluted earnings per share - net earnings
attributable to Acxiom stockholders:
Numerator - net earnings attributable to         44,369           31,197
Acxiom
Denominator - weighted-average shares            75,195           80,039
outstanding
Dilutive effect of common stock options,         1,792            838
warrants, and restricted stock
                                                 76,987           80,877
                                                                  
Diluted earnings per share - net earnings        0.58             0.39
attributable to Acxiom stockholders
                                                                  

                                                        
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        186,220          229,648         (43,428  )     (18.9  %)
equivalents
Trade accounts       182,457          169,446         13,011         7.7    %
receivable, net
Deferred income      15,082           15,107          (25      )     (0.2   %)
taxes
Other current        52,750          57,804         (5,054   )     100.0  %
assets
                                                                     
Total current        436,509          472,005         (35,496  )     (7.5   %)
assets
                                                                     
Property and         811,416          913,073         (101,657 )     (11.1  %)
equipment
Less -
accumulated          579,642         659,700        (80,058  )     (12.1  %)
depreciation and
amortization
                                                                     
Property and         231,774         253,373        (21,599  )     (8.5   %)
equipment, net
                                                                     
Software, net of
accumulated          19,491           13,211          6,280          47.5   %
amortization
Goodwill             382,704          382,285         419            0.1    %
Purchased
software
licenses, net of     21,583           25,294          (3,711   )     (14.7  %)
accumulated
amortization
Deferred costs,      47,211           61,977          (14,766  )     (23.8  %)
net
Data acquisition     11,540           15,009          (3,469   )     (23.1  %)
costs
Other assets,        2,831           3,697          (866     )     (23.4  %)
net
                                                                     
                     1,153,643       1,226,851      (73,208  )     (6.0   %)
                                                                     
Liabilities and
Stockholders’
Equity
Current
liabilities:
Current
installments of      19,814           26,336          6,522          24.8   %
long-term debt
Trade accounts       19,873           31,030          11,157         36.0   %
payable
Accrued payroll
and related          47,041           54,839          7,798          14.2   %
expenses
Other accrued        73,696           77,062          3,366          4.4    %
expenses
Deferred revenue     47,389           59,949          12,560         21.0   %
Income taxes         3,229           16,400         13,171         80.3   %
                                                                     
Total current        211,042         265,616        54,574         20.5   %
liabilities
                                                                     
Long-term debt       240,774          251,886         11,112         4.4    %
                                                                     
Deferred income      86,614           93,039          6,425          6.9    %
taxes
                                                                     
Other                4,178            4,455           277            6.2    %
liabilities
                                                                     
Stockholders’
equity:
Common stock         12,108           12,003          105            0.9    %
Additional           877,619          860,165         17,454         2.0    %
paid-in capital
Retained             580,728          536,359         44,369         8.3    %
earnings
Accumulated
other                14,714           13,601          1,113          8.2    %
comprehensive
income
Treasury stock,      (873,893   )     (810,381  )     (63,512  )     7.8    %
at cost
Total Acxiom
stockholders’        611,276          611,747         (471     )     (0.1   %)
equity
Noncontrolling       (241       )     108            (349     )     (323.1 %)
interest
                                                                     
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           188,404         119,113 
period
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          4,002            4,709
payment arrangements
Payments on software and data license               78               125
liabilities
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               -                4,042
arrangements
                                                                             

                                                               
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              (287     )     (326     )
acquisitions
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           12,948         13,687
payment arrangements
Payments on software and data license                337            616
liabilities
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                2,157          8,733
arrangements
                                                                             

                                                                                                                                     
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           TTM         TTM
                                                                                                                                FY2013        12/31/11      12/31/12
                                                                                                                                                            
Net cash
provided
(used) by        32,754        57,714        82,540        56,443        229,451       (1,867  )     39,235       38,543        75,911        215,043       132,354
operating
activities
                                                                                                                                                            
Less:
Disposition
of               -             (1,043  )     -             73,468        72,425        -             -            -             -             (1,043  )     73,468
operations
Capitalized      (529    )     (991    )     (1,647  )     (2,095  )     (5,262  )     (3,673  )     (4,074 )     (5,443  )     (13,190 )     (4,130  )     (15,285 )
software
Capital          (12,577 )     (12,134 )     (14,436 )     (12,444 )     (51,591 )     (3,538  )     (8,178 )     (10,260 )     (21,976 )     (51,360 )     (34,420 )
expenditures
Data
acquisition      (2,776  )     (1,774  )     (3,999  )     (3,763  )     (12,312 )     (2,302  )     (1,396 )     (2,766  )     (6,464  )     (11,199 )     (10,227 )
costs
Payments on
capital
leases and       (4,794  )     (4,184  )     (4,709  )     (4,644  )     (18,331 )     (4,562  )     (4,384 )     (4,002  )     (12,948 )     (18,939 )     (17,592 )
installment
payment
arrangements
Payments on
software and     (367    )     (124    )     (125    )     (2,300  )     (2,916  )     (129    )     (130   )     (78     )     (337    )     (4,755  )     (2,637  )
data license
liabilities
Other
required         (2,151  )   (2,155  )   (2,159  )   (2,164  )   (8,629  )     (2,165  )   (2,168 )   (2,172  )   (6,505  )     (8,619  )   (8,669  )
debt
payments
                                                                                                                                                            
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      184,996       195,857       187,461       203,400       771,714         185,739       194,409       190,138       570,286       1.4    %     2,677
data services
IT
Infrastructure     73,050        73,712        77,173        67,590        291,525         70,290        70,061        69,916        210,267       -9.4   %     (7,257  )
management
services
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            218,289       217,487       213,925       213,788       863,489         209,326       209,886       209,027       628,239       -2.3   %     (4,898  )
revenue
Selling,
general and        36,807        39,429        36,318        38,577        151,131         36,749        37,341        37,303        111,393       2.7    %     985
administrative
Impairment of
goodwill and       -             -             17,803        -             17,803          -             -             -             -                          (17,803 )
other
intangibles
Gains, losses
and other          244        2,465      (2,671  )   12,600     12,638         160        32         (126    )   66           -95.3  %   2,545   
items, net
                                                                                                                                                                
Total
operating          255,340       259,381       265,375       264,965       1,045,061       246,235       247,259       246,204       739,698       -7.2   %     (19,171 )
costs and
expenses
                                                                                                                                                                
Income from        20,704        27,051        15,518        22,290        85,563          25,424        30,208        26,898        82,530        73.3   %     11,380
operations
% Margin           7.5     %     9.4     %     5.5     %     7.8     %     7.6       %     9.4     %     10.9    %     9.8     %     10.0    %
Other expense
Interest           (5,455  )     (4,719  )     (3,883  )     (3,391  )     (17,448   )     (3,240  )     (3,317  )     (3,178  )     (9,735  )     18.2   %     705
expense
Other, net         (87     )   (965    )   (98     )   (219    )   (1,369    )     (547    )   (54     )   565        (36     )     676.5  %   663     
Total other        (5,542  )     (5,684  )     (3,981  )     (3,610  )     (18,817   )     (3,787  )     (3,371  )     (2,613  )     (9,771  )     34.4   %     1,368
expense
                                                                                                                                                                
Earnings from
continuing
operations         15,162        21,367        11,537        18,680        66,746          21,637        26,837        24,285        72,759        110.5  %     12,748
before income
taxes
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               9,099         11,839        1,837         14,842        37,617          13,199        16,372        14,449        44,020        686.6  %     12,612
continuing
operations
                                                                                                                                                                
Earnings from
discontinued       916        1,138      814        31,031     33,899         -          -          -          -            -100.0 %   (814    )
operations,
net of tax
                                                                                                                                                                
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       (960    )   685        (5,279  )   (193    )   (5,747    )     (134    )   (139    )   (76     )   (349    )     -98.6  %   5,203   
to
noncontrolling
interest
                                                                                                                                                                
Net earnings
attributable       10,975     12,292     7,930      46,066     77,263         13,333     16,511     14,525     44,369       83.2   %   6,595   
to Acxiom
                                                                                                                                                                
Diluted
earnings per
share - net
earnings           0.13       0.15       0.10       0.58       0.96           0.17       0.21       0.19       0.58         90.0   %   0.09    
attributable
to Acxiom
stockholders
                                                                                                                                                                        


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      184,996       195,857       187,461       203,400       771,714         185,739       194,409       190,138       570,286       1    %     2,677
data services
IT
Infrastructure     73,050        73,712        77,173        67,590        291,525         70,290        70,061        69,916        210,267       -9   %     (7,257 )
management
services
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      17,260        27,078        21,388        30,094        95,820          17,975        23,331        17,971        59,277        -16  %     (3,417 )
data services
IT
Infrastructure     4,247         5,091         9,795         5,855         24,988          8,831         8,520         9,622         26,973        -2   %     (173   )
management
services
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               20,704     27,051     15,518     22,290     85,563         25,424     30,208     26,898     82,530       73   %   11,380 
operations
                                                                                                                                                              
Margin:
                                                                                                                                                              
Marketing and      9.3     %     13.8    %     11.4    %     14.8    %     12.4      %     9.7     %     12.0    %     9.5     %     10.4    %
data services
IT
Infrastructure     5.8     %     6.9     %     12.7    %     8.7     %     8.6       %     12.6    %     12.2    %     13.8    %     12.8    %
management
services
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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Contact:

Acxiom Corporation
Katharine Boyce, 501-342-1321
investor.relations@acxiom.com
EACXM