Acxiom Announces Third Quarter Results

Wed Jan 30, 2013 4:05pm EST

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U.S. marketing and data services revenue up 4 percent
LITTLE ROCK, Ark.--(Business Wire)--
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 Engageto be
heldon March 6-8 in New York City. Over 200 top clients and prospects are
registered to attend the conference which provides the opportunity for the
world`s largest marketers to discuss case studies and new technologies.
President Bill Clinton will deliver the keynote address and statistician Nate
Silver will also be featured. 
* Acxiom appointed Dana Hayes, Jr. as Group VP of Partner Development. Hayes
will lead efforts to build strategic partnerships and distribution relationships
for global data driven marketing and advertising. He has more than 15 years of
experience in digital media and marketing in leadership roles with companies
such as weather.com and Tribune Company.

Segment Results:

* Marketing and Data Services: Revenue for the third quarter increased slightly
to $190 million, as compared to $187 million for the same period a year ago.
U.S. revenue of $160 million increased 4 percent but was offset by declines
internationally. Income from operations for the third quarter was $18 million,
compared to $21 million in the prior period. Operating margin was 10 percent,
compared to 11 percent in the previous year. 
* IT Infrastructure Management: Revenue for the third quarter decreased 9
percent to $70 million, compared to $77 million for the same period a year ago.
Income from operations for the quarter was roughly flat at $10 million.
Operating margin was approximately 14 percent, compared to 13 percent a year
ago. 
* Other Services: Revenue was $13 million as compared to $16 million in the
prior year. Loss from operations was roughly flat at $1 million.

Financial Guidance

The following projections are forward looking and are subject to certain risks
and uncertainties that could cause actual results to differ materially as
detailed in the Forward Looking Statements section of this press release. Our
guidance does not take into account any unusual charges. Acxiom`s estimates for
fiscal 2013 are as follows:

* We expect revenue for the fiscal year to be down approximately 2.5 percent as
compared to $1.131 billion in the prior year. The decline is projected primarily
as a result of decreases in IT infrastructure management and international
operations. 
* We now expect earnings per diluted share of up to $.73 as compared to our
previous guidance of roughly $.70.

Conference Call

Acxiom will hold a conference call at 4:00 p.m. CST today to further discuss
this information. Interested parties are invited to listen to the call, which
will be broadcast via the Internet at www.acxiom.com. A slide presentation will
be referenced during the call and can be accessed here. 

Web Link to Financials

You may link to http://www.acxiom.com/FY13_Q3_Financials for the detailed
financial information we typically attach to our earnings releases. 

About Acxiom

Acxiom is a recognized leader in marketing services and technology that enable
marketers to successfully manage audiences, personalize consumer experiences and
create profitable customer relationships. Our superior industry-focused,
consultative approach combines consumer data and analytics, databases, data
integration and consulting solutions for personalized, multichannel marketing
strategies. Acxiom leverages over 40 years of experience in data management to
deliver high-performance, highly secure, reliable information management
services. Founded in 1969, Acxiom is headquartered in Little Rock, Arkansas,
USA, and serves clients around the world from locations in the United States,
Europe, Asia-Pacific, and South America. For more information about Acxiom,
visit Acxiom.com. 

Forward Looking Statements

This release and today`s conference call may contain forward-looking statements
including, without limitation, statements regarding expected levels of revenue
from continuing operations and earnings per share as well as statements
regarding new product launches. Such forward-looking statements are subject to
certain risks and uncertainties that could cause actual results to differ
materially. The following are factors, among others, that could cause actual
results to differ materially from these forward-looking statements: the
possibility that certain contracts may not generate the anticipated revenue or
profitability or may not be closed within the anticipated time frames; the
possibility that significant customers may experience extreme, severe economic
difficulty or otherwise reduce the amount of business they do with us; the
possibility that we will not successfully complete customer contract
requirements on time or meet the service levels specified in the contracts,
which may result in contract penalties or lost revenue; the possibility that
data suppliers might withdraw data from us, leading to our inability to provide
certain products and services to our clients, which could lead to decreases in
our operating results; the possibility that we may not be able to attract,
retain or motivate qualified technical, sales and leadership associates, or that
we may lose key associates; the possibility that we may not be able to
adequately adapt to rapidly changing computing environments, technologies and
marketing practices; the possibility that we will not be able to continue to
receive credit upon satisfactory terms and conditions; the possibility that
negative changes in economic conditions in general or other conditions might
lead to a reduction in demand for our products and services; the possibility
that there will be changes in consumer or business information industries and
markets that negatively impact the company; the possibility that the historical
seasonality of our business may change; the possibility that we will not be able
to achieve cost reductions and avoid unanticipated costs; the possibility that
the fair value of certain of our assets may not be equal to the carrying value
of those assets now or in future time periods; the possibility that unusual
charges may be incurred; the possibility that changes in accounting
pronouncements may occur and may impact these forward-looking statements; the
possibility that we may encounter difficulties when entering new markets or
industries; the possibility that we could experience loss of data center
capacity or interruption of telecommunication links; the possibility that new
laws may be enacted which limit our ability to provide services to our clients
and/or which limit the use of data; and other risks and uncertainties, including
those detailed from time to time in our periodic reports filed with the
Securities and Exchange Commission, including our current reports on Form 8-K,
quarterly reports on Form 10-Q and annual reports on Form 10-K, particularly the
discussion under the caption "Item 1A, RISK FACTORS" in our Annual Report on
Form 10-K for the year ended March 31, 2012, which was filed with the Securities
and Exchange Commission on May 25, 2012. 

With respect to the provision of products or services outside our primary base
of operations in the United States, all of the above factors apply, along with
the difficulty of doing business in numerous sovereign jurisdictions due to
differences in scale, competition, culture, laws and regulations. 

We undertake no obligation to update the information contained in this press
release or any other forward-looking statement. 

Acxiom is a registered trademark of Acxiom Corporation.

                                                                                                                                                
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                                            
 CONSOLIDATED STATEMENTS OF OPERATIONS                                                                                                          
 (Unaudited)                                                                                                                                    
 (Dollars in thousands, except earnings per share)                                                                                              
                                                                                                                                                
                                                              For the Three Months Ended                                                        
                                                              December 31,                                                                      
                                                                                                          $                      %              
                                                              2012                  2011                  Variance               Variance       
                                                                                                                                                
 Revenue:                                                                                                                                       
 Marketing and data services                                  190,138               187,461               2,677                  1.4     %      
 IT Infrastructure management services                        69,916                77,173                (7,257  )              (9.4    %)     
 Other services                                               13,048                16,259                (3,211  )              (19.7   %)     
 Total revenue                                                273,102               280,893               (7,791  )              (2.8    %)     
                                                                                                                                                
 Operating costs and expenses:                                                                                                                  
 Cost of revenue                                              209,027               213,925               4,898                  2.3     %      
 Selling, general and administrative                          37,303                36,318                (985    )              (2.7    %)     
 Impairment of goodwill and other intangibles                 -                     17,803                17,803                 100.0   %      
 Gains, losses and other items, net                           (126     )            (2,671   )            2,545                  95.3    %      
                                                                                                                                                
 Total operating costs and expenses                           246,204               265,375               19,171                 7.2     %      
                                                                                                                                                
 Income from operations                                       26,898                15,518                11,380                 73.3    %      
 % Margin                                                     9.8      %            5.5      %                                                  
 Other income (expense):                                                                                                                        
 Interest expense                                             (3,178   )            (3,883   )            705                    18.2    %      
 Other, net                                                   565                   (98      )            663                    676.5   %      
                                                                                                                                                
 Total other income (expense)                                 (2,613   )            (3,981   )            1,368                  34.4    %      
                                                                                                                                                
 Earnings from continuing operations before income taxes      24,285                11,537                12,748                 110.5   %      
                                                                                                                                                
 Income taxes                                                 9,836                 9,700                 (136    )              (1.4    %)     
                                                                                                                                                
 Net earnings from continuing operations                      14,449                1,837                 12,612                 686.6   %      
                                                                                                                                                
 Earnings from discontinued operations, net of tax            -                     814                   (814    )              (100.0  %)     
                                                                                                                                                
 Net earnings                                                 14,449                2,651                 11,798                 445.0   %      
                                                                                                                                                
 Less: Net loss attributable to noncontrolling interest       (76      )            (5,279   )            5,203                  98.6    %      
                                                                                                                                                
 Net earnings attributable to Acxiom                          14,525                7,930                 6,595                  83.2    %      
                                                                                                                                                
 Basic earnings per share:                                                                                                                      
 Net earnings from continuing operations                      0.19                  0.02                  0.17                   850.0   %      
 Earnings from discontinued operations                        0.00                  0.01                  (0.01   )              (100.0  %)     
 Net earnings                                                 0.19                  0.03                  0.16                   533.3   %      
                                                                                                                                                
 Net earnings attributable to Acxiom stockholders             0.20                  0.10                  0.10                   100.0   %      
                                                                                                                                                
                                                                                                                                                
 Diluted earnings per share:                                                                                                                    
 Net earnings from continuing operations                      0.19                  0.02                  0.17                   850.0   %      
 Earnings from discontinued operations                        0.00                  0.01                  (0.01   )              (100.0  %)     
 Net earnings                                                 0.19                  0.03                  0.16                   533.3   %      
                                                                                                                                                
 Net earnings attributable to Acxiom stockholders             0.19                  0.10                  0.09                   90.0    %      
                                                                                                                                                


                                                                                                                                                 
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                                             
 CONSOLIDATED STATEMENTS OF OPERATIONS                                                                                                           
 (Unaudited)                                                                                                                                     
 (Dollars in thousands, except earnings per share)                                                                                               
                                                                                                                                                 
                                                              For the Nine Months Ended                                                          
                                                              December 31,                                                                       
                                                                                                          $                       %              
                                                              2012                  2011                  Variance                Variance       
                                                                                                                                                 
 Revenue:                                                                                                                                        
 Marketing and data services                                  570,286               568,314               1,972                   0.3     %      
 IT Infrastructure management services                        210,267               223,935               (13,668  )              (6.1    %)     
 Other services                                               41,675                51,120                (9,445   )              (18.5   %)     
 Total revenue                                                822,228               843,369               (21,141  )              (2.5    %)     
                                                                                                                                                 
 Operating costs and expenses:                                                                                                                   
 Cost of revenue                                              628,239               649,701               21,462                  3.3     %      
 Selling, general and administrative                          111,393               112,554               1,161                   1.0     %      
 Impairment of goodwill and other intangibles                 -                     17,803                17,803                  100.0   %      
 Gains, losses and other items, net                           66                    38                    (28      )              (73.7   %)     
                                                                                                                                                 
 Total operating costs and expenses                           739,698               780,096               40,398                  5.2     %      
                                                                                                                                                 
 Income from operations                                       82,530                63,273                19,257                  30.4    %      
 % Margin                                                     10.0     %            7.5      %                                                   
 Other income (expense):                                                                                                                         
 Interest expense                                             (9,735   )            (14,057  )            4,322                   30.7    %      
 Other, net                                                   (36      )            (1,150   )            1,114                   96.9    %      
                                                                                                                                                 
 Total other income (expense)                                 (9,771   )            (15,207  )            5,436                   35.7    %      
                                                                                                                                                 
 Earnings from continuing operations before income taxes      72,759                48,066                24,693                  51.4    %      
                                                                                                                                                 
 Income taxes                                                 28,739                25,291                (3,448   )              (13.6   %)     
                                                                                                                                                 
 Net earnings from continuing operations                      44,020                22,775                21,245                  93.3    %      
                                                                                                                                                 
 Earnings from discontinued operations, net of tax            -                     2,868                 (2,868   )              (100.0  %)     
                                                                                                                                                 
 Net earnings                                                 44,020                25,643                18,377                  71.7    %      
                                                                                                                                                 
 Less: Net loss attributable to noncontrolling interest       (349     )            (5,554   )            5,205                   93.7    %      
                                                                                                                                                 
 Net earnings attributable to Acxiom                          44,369                31,197                13,172                  42.2    %      
                                                                                                                                                 
 Basic earnings per share:                                                                                                                       
 Net earnings from continuing operations                      0.59                  0.28                  0.31                    110.7   %      
 Earnings from discontinued operations                        0.00                  0.04                  (0.04    )              (100.0  %)     
 Net earnings                                                 0.59                  0.32                  0.27                    84.4    %      
                                                                                                                                                 
 Net earnings attributable to Acxiom stockholders             0.59                  0.39                  0.20                    51.3    %      
                                                                                                                                                 
                                                                                                                                                 
 Diluted earnings per share:                                                                                                                     
 Net earnings from continuing operations                      0.57                  0.28                  0.29                    103.6   %      
 Earnings from discontinued operations                        0.00                  0.04                  (0.04    )              (100.0  %)     
 Net earnings                                                 0.57                  0.32                  0.25                    78.1    %      
                                                                                                                                                 
 Net earnings attributable to Acxiom stockholders             0.58                  0.39                  0.19                    48.7    %      
                                                                                                                                                 


                                                                                                                                                                    
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                                                                
 RECONCILIATION OF GAAP TO NON-GAAP EPS                                                                                                                             
 (Unaudited)                                                                                                                                                        
 (Dollars in thousands, except earnings per share)                                                                                                                  
                                                                                                                                                                    
                                                                        For the Three Months Ended                      For the Nine Months Ended                   
                                                                        December 31,                                    December 31,                                
                                                                        2012                         2011               2012                         2011           
                                                                                                                                                                    
                                                                                                                                                                    
 Earnings from continuing operations before income taxes                24,285                       11,537             72,759                       48,066         
                                                                                                                                                                    
 Income taxes                                                           9,836                        9,700              28,739                       25,291         
                                                                                                                                                                    
 Net earnings from continuing operations                                14,449                       1,837              44,020                       22,775         
                                                                                                                                                                    
 Earnings from discontinued operations, net of tax                      -                            814                -                            2,868          
                                                                                                                                                                    
 Net earnings                                                           14,449                       2,651              44,020                       25,643         
                                                                                                                                                                    
 Less: Net earnings (loss) attributable to noncontrolling interest      (76     )                    (5,279  )          (349    )                    (5,554  )      
                                                                                                                                                                    
 Net earnings attributable to Acxiom                                    14,525                       7,930              44,369                       31,197         
                                                                                                                                                                    
 Earnings per share attributable to Acxiom stockholders:                                                                                                            
                                                                                                                                                                    
 Basic                                                                  0.20                         0.10               0.59                         0.39           
                                                                                                                                                                    
 Diluted                                                                0.19                         0.10               0.58                         0.39           
                                                                                                                                                                    
 Unusual items:                                                                                                                                                     
                                                                                                                                                                    
 MENA disposal                                                          -                            -                  -                            2,512          
 Impairment of goodwill and other intangibles                           -                            17,803             -                            17,803         
 Adjustment of earnout liability                                        -                            (2,598  )          -                            (2,598  )      
 Other adjustments                                                      (126    )                    (73     )          66                           124            
                                                                                                                                                                    
 Total unusual items                                                    (126    )                    15,132             66                           17,841         
                                                                                                                                                                    
 Earnings from continuing operations before income taxes                                                                                                            
 and excluding unusual items                                            24,159                       26,669             72,825                       65,907         
                                                                                                                                                                    
 Income taxes                                                           9,760                        10,649             28,764                       26,341         
                                                                                                                                                                    
 Non-GAAP earnings from continuing operations                           14,399                       16,020             44,061                       39,566         
                                                                                                                                                                    
 Earnings from discontinued operations, net of tax                      -                            814                -                            2,868          
                                                                                                                                                                    
 Non-GAAP net earnings                                                  14,399                       16,834             44,061                       42,434         
                                                                                                                                                                    
 Less: Net earnings (loss) attributable to noncontrolling interest      (76     )                    (231    )          (349    )                    (1,371  )      
                                                                                                                                                                    
 Non-GAAP Net earnings attributable to Acxiom                           14,475                       17,065             44,410                       43,805         
                                                                                                                                                                    
 Non-GAAP earnings per share attributable to Acxiom stockholders:                                                                                                   
                                                                                                                                                                    
 Basic                                                                  0.20                         0.22               0.59                         0.55           
                                                                                                                                                                    
 Diluted                                                                0.19                         0.22               0.58                         0.54           
                                                                                                                                                                    
 Diluted weighted average shares                                        75,878                       79,020             76,987                       80,877         
                                                                                                                                                                    


                                                                                                                                  
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                              
 RECONCILIATION OF GAAP TO NON-GAAP INCOME FROM OPERATIONS                                                                        
 (Unaudited)                                                                                                                      
 (Dollars in thousands, except earnings per share)                                                                                
                                                                                                                                  
                                                  For the Three Months Ended                  For the Nine Months Ended           
                                                  December 31,                                December 31,                        
                                                  2012                            2011        2012                       2011     
                                                                                                                                  
 Income from operations                           26,898                          15,518      82,530                     63,273   
                                                                                                                                  
 Unusual items                                    (126    )                       15,132      66                         17,841   
                                                                                                                                  
 Income from operations before unusual items      26,772                          30,650      82,596                     81,114   
                                                                                                                                  


                                                                                                                                   
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                               
 CALCULATION OF EARNINGS PER SHARE                                                                                                 
 (Unaudited)                                                                                                                       
 (In thousands, except earnings per share)                                                                                         
                                                                                                                                   
                                                                                     For the Three Months Ended                    
                                                                                                                                   
                                                                                     December 31,                    December 31,  
                                                                                     2012                            2011          
                                                                                                                                   
 Basic earnings per share from continuing operations:                                                                              
 Numerator - net earnings                                                            14,449                          1,837         
 Denominator - weighted-average shares outstanding                                   74,103                          78,189        
 Basic earnings per share                                                            0.19                            0.02          
                                                                                                                                   
 Basic earnings per share - net earnings attributable to Acxiom stockholders:                                                      
 Numerator - net earnings attributable to Acxiom                                     14,525                          7,930         
 Denominator - weighted-average shares outstanding                                   74,103                          78,189        
 Basic earnings per share - net earnings attributable to Acxiom stockholders         0.20                            0.10          
                                                                                                                                   
 Diluted earnings per share from continuing operations:                                                                            
 Numerator - net earnings                                                            14,449                          1,837         
 Denominator - weighted-average shares outstanding                                   74,103                          78,189        
 Dilutive effect of common stock options, warrants and restricted stock              1,775                           831           
                                                                                     75,878                          79,020        
                                                                                                                                   
 Diluted earnings per share from continuing operations                               0.19                            0.02          
                                                                                                                                   
 Diluted earnings per share - net earnings attributable to Acxiom stockholders:                                                    
 Numerator - net earnings attributable to Acxiom                                     14,525                          7,930         
 Denominator - weighted-average shares outstanding                                   74,103                          78,189        
 Dilutive effect of common stock options, warrants, and restricted stock             1,775                           831           
                                                                                     75,878                          79,020        
                                                                                                                                   
 Diluted earnings per share - net earnings attributable to Acxiom stockholders       0.19                            0.10          
                                                                                                                                   


                                                                                                                                   
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                               
 CALCULATION OF EARNINGS PER SHARE                                                                                                 
 (Unaudited)                                                                                                                       
 (In thousands, except earnings per share)                                                                                         
                                                                                                                                   
                                                                                     For the Nine Months Ended                     
                                                                                                                                   
                                                                                     December 31,                    December 31,  
                                                                                     2012                            2011          
                                                                                                                                   
 Basic earnings per share from continuing operations:                                                                              
 Numerator - net earnings                                                            44,020                          22,775        
 Denominator - weighted-average shares outstanding                                   75,195                          80,039        
 Basic earnings per share                                                            0.59                            0.28          
                                                                                                                                   
 Basic earnings per share - net earnings attributable to Acxiom stockholders:                                                      
 Numerator - net earnings attributable to Acxiom                                     44,369                          31,197        
 Denominator - weighted-average shares outstanding                                   75,195                          80,039        
 Basic earnings per share - net earnings attributable to Acxiom stockholders         0.59                            0.39          
                                                                                                                                   
 Diluted earnings per share from continuing operations:                                                                            
 Numerator - net earnings                                                            44,020                          22,775        
 Denominator - weighted-average shares outstanding                                   75,195                          80,039        
 Dilutive effect of common stock options, warrants and restricted stock              1,792                           838           
                                                                                     76,987                          80,877        
                                                                                                                                   
 Diluted earnings per share from continuing operations                               0.57                            0.28          
                                                                                                                                   
 Diluted earnings per share - net earnings attributable to Acxiom stockholders:                                                    
 Numerator - net earnings attributable to Acxiom                                     44,369                          31,197        
 Denominator - weighted-average shares outstanding                                   75,195                          80,039        
 Dilutive effect of common stock options, warrants, and restricted stock             1,792                           838           
                                                                                     76,987                          80,877        
                                                                                                                                   
 Diluted earnings per share - net earnings attributable to Acxiom stockholders       0.58                            0.39          
                                                                                                                                   


                                                                                                
 ACXIOM CORPORATION AND SUBSIDIARIES                                                            
 RESULTS BY SEGMENT                                                                             
 (Unaudited)                                                                                    
 (Dollars in thousands)                                                                         
                                                                                                
                                              For the Three Months Ended                        
                                                                                                
                                              December 31,                    December 31,      
 Revenue:                                     2012                            2011              
                                                                                                
 Marketing and data services                  190,138                         187,461           
 IT Infrastructure management services        69,916                          77,173            
 Other services                               13,048                          16,259            
                                                                                                
 Total revenue                                273,102                         280,893           
                                                                                                
                                                                                                
 Income from continuing operations:                                                             
                                                                                                
 Marketing and data services                  17,971                          21,388            
 IT Infrastructure management services        9,622                           9,795             
 Other services                               (821     )                      (533     )        
 Corporate                                    126                             (15,132  )        
                                                                                                
 Total income from continuing operations      26,898                          15,518            
                                                                                                
 Margin:                                                                                        
                                                                                                
 Marketing and data services                  9.5      %                      11.4     %        
 IT Infrastructure management services        13.8     %                      12.7     %        
 Other services                               -6.3     %                      -3.3     %        
                                                                                                
 Total margin                                 9.8      %                      5.5      %        
                                                                                                


                                                                                              
 ACXIOM CORPORATION AND SUBSIDIARIES                                                          
 RESULTS BY SEGMENT                                                                           
 (Unaudited)                                                                                  
 (Dollars in thousands)                                                                       
                                                                                              
                                            For the Nine Months Ended                         
                                                                                              
                                            December 31,                    December 31,      
 Revenue:                                   2012                            2011              
                                                                                              
 Marketing and data services                570,286                         568,314           
 IT Infrastructure management services      210,267                         223,935           
 Other services                             41,675                          51,120            
                                                                                              
 Total revenue                              822,228                         843,369           
                                                                                              
                                                                                              
 Income from operations:                                                                      
                                                                                              
 Marketing and data services                59,277                          65,726            
 IT Infrastructure management services      26,973                          19,133            
 Other services                             (3,654   )                      (3,745   )        
 Corporate                                  (66      )                      (17,841  )        
                                                                                              
 Total income from operations               82,530                          63,273            
                                                                                              
 Margin:                                                                                      
                                                                                              
 Marketing and data services                10.4     %                      11.6     %        
 IT Infrastructure management services      12.8     %                      8.5      %        
 Other services                             -8.8     %                      -7.3     %        
                                                                                              
 Total margin                               10.0     %                      7.5      %        
                                                                                              


                                                                                                                                                     
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                                                 
 CONDENSED CONSOLIDATED BALANCE SHEETS                                                                                                               
 (Unaudited)                                                                                                                                         
 (Dollars in thousands)                                                                                                                              
                                                                                                                                                     
                                                                   December 31,            March 31,             $                    %              
                                                                   2012                    2012                  Variance             Variance       
 Assets                                                                                                                                              
 Current assets:                                                                                                                                     
 Cash and cash equivalents                                         186,220                 229,648               (43,428   )          (18.9   %)     
 Trade accounts receivable, net                                    182,457                 169,446               13,011               7.7     %      
 Deferred income taxes                                             15,082                  15,107                (25       )          (0.2    %)     
 Other current assets                                              52,750                  57,804                (5,054    )          100.0   %      
                                                                                                                                                     
 Total current assets                                              436,509                 472,005               (35,496   )          (7.5    %)     
                                                                                                                                                     
 Property and equipment                                            811,416                 913,073               (101,657  )          (11.1   %)     
 Less - accumulated depreciation and amortization                  579,642                 659,700               (80,058   )          (12.1   %)     
                                                                                                                                                     
 Property and equipment, net                                       231,774                 253,373               (21,599   )          (8.5    %)     
                                                                                                                                                     
 Software, net of accumulated amortization                         19,491                  13,211                6,280                47.5    %      
 Goodwill                                                          382,704                 382,285               419                  0.1     %      
 Purchased software licenses, net of accumulated amortization      21,583                  25,294                (3,711    )          (14.7   %)     
 Deferred costs, net                                               47,211                  61,977                (14,766   )          (23.8   %)     
 Data acquisition costs                                            11,540                  15,009                (3,469    )          (23.1   %)     
 Other assets, net                                                 2,831                   3,697                 (866      )          (23.4   %)     
                                                                                                                                                     
                                                                   1,153,643               1,226,851             (73,208   )          (6.0    %)     
                                                                                                                                                     
 Liabilities and Stockholders` Equity                                                                                                                
 Current liabilities:                                                                                                                                
 Current installments of long-term debt                            19,814                  26,336                6,522                24.8    %      
 Trade accounts payable                                            19,873                  31,030                11,157               36.0    %      
 Accrued payroll and related expenses                              47,041                  54,839                7,798                14.2    %      
 Other accrued expenses                                            73,696                  77,062                3,366                4.4     %      
 Deferred revenue                                                  47,389                  59,949                12,560               21.0    %      
 Income taxes                                                      3,229                   16,400                13,171               80.3    %      
                                                                                                                                                     
 Total current liabilities                                         211,042                 265,616               54,574               20.5    %      
                                                                                                                                                     
 Long-term debt                                                    240,774                 251,886               11,112               4.4     %      
                                                                                                                                                     
 Deferred income taxes                                             86,614                  93,039                6,425                6.9     %      
                                                                                                                                                     
 Other liabilities                                                 4,178                   4,455                 277                  6.2     %      
                                                                                                                                                     
 Stockholders` equity:                                                                                                                               
 Common stock                                                      12,108                  12,003                105                  0.9     %      
 Additional paid-in capital                                        877,619                 860,165               17,454               2.0     %      
 Retained earnings                                                 580,728                 536,359               44,369               8.3     %      
 Accumulated other comprehensive income                            14,714                  13,601                1,113                8.2     %      
 Treasury stock, at cost                                           (873,893   )            (810,381   )          (63,512   )          7.8     %      
 Total Acxiom stockholders` equity                                 611,276                 611,747               (471      )          (0.1    %)     
 Noncontrolling interest                                           (241       )            108                   (349      )          (323.1  %)     
                                                                                                                                                     
 Total equity                                                      611,035                 611,855               (820      )          (0.1    %)     
                                                                                                                                                     
                                                                   1,153,643               1,226,851             (73,208   )          (6.0    %)     
                                                                                                                                                     


                                                                                                                                                   
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                                               
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS                                                                                                   
 (Unaudited)                                                                                                                                       
 (Dollars in thousands)                                                                                                                            
                                                                                                                                                   
                                                                                                     For the Three Months Ended                    
                                                                                                     December 31,                                  
                                                                                                     2012                          2011            
                                                                                                                                                   
 Cash flows from operating activities:                                                                                                             
 Net earnings                                                                                        14,449                        2,651           
 Non-cash operating activities:                                                                                                                    
 Depreciation and amortization                                                                       29,363                        32,986          
 Gain on disposal or impairment of assets                                                            -                             (2,710   )      
 Impairment of goodwill and other intangibles                                                        -                             17,803          
 Deferred income taxes                                                                               (2,962   )                    1,404           
 Non-cash stock compensation expense                                                                 3,103                         1,710           
 Changes in operating assets and liabilities:                                                                                                      
 Accounts receivable                                                                                 (15,867  )                    6,913           
 Other assets                                                                                        5,492                         4,390           
 Deferred costs                                                                                      (326     )                    (1,048   )      
 Accounts payable and other liabilities                                                              5,525                         1,320           
 Deferred revenue                                                                                    (234     )                    17,121          
 Net cash provided by operating activities                                                           38,543                        82,540          
 Cash flows from investing activities:                                                                                                             
 Capitalized software                                                                                (5,443   )                    (1,647   )      
 Capital expenditures                                                                                (10,260  )                    (14,436  )      
 Data acquisition costs                                                                              (2,766   )                    (3,999   )      
 Payments received from investments                                                                  -                             370             
 Net cash used by investing activities                                                               (18,469  )                    (19,712  )      
 Cash flows from financing activities:                                                                                                             
 Payments of debt                                                                                    (6,252   )                    (31,993  )      
 Sale of common stock                                                                                2,128                         4,500           
 Acquisition of treasury stock                                                                       (18,256  )                    (8,727   )      
 Net cash used by financing activities                                                               (22,380  )                    (36,220  )      
 Effect of exchange rate changes on cash                                                             122                           142             
                                                                                                                                                   
 Net change in cash and cash equivalents                                                             (2,184   )                    26,750          
 Cash and cash equivalents at beginning of period                                                    188,404                       119,113         
 Cash and cash equivalents at end of period                                                          186,220                       145,863         
                                                                                                                                                   
 Supplemental cash flow information:                                                                                                               
 Cash paid during the period for:                                                                                                                  
 Interest                                                                                            3,178                         4,160           
 Income taxes                                                                                        12,104                        9,784           
 Payments on capital leases and installment payment arrangements                                     4,002                         4,709           
 Payments on software and data license liabilities                                                   78                            125             
 Other debt payments, excluding line of credit                                                       2,172                         2,159           
 Prepayment of debt                                                                                  -                             25,000          
 Noncash investing and financing activities:                                                                                                       
 Acquisition of property and equipment under capital lease and installment payment arrangements      -                             4,042           
                                                                                                                                                   


                                                                                                                                                    
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                                                
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS                                                                                                    
 (Unaudited)                                                                                                                                        
 (Dollars in thousands)                                                                                                                             
                                                                                                                                                    
                                                                                                     For the Nine Months Ended                      
                                                                                                     December 31,                                   
                                                                                                     2012                          2011             
                                                                                                                                                    
 Cash flows from operating activities:                                                                                                              
 Net earnings                                                                                        44,020                        25,643           
 Non-cash operating activities:                                                                                                                     
 Depreciation and amortization                                                                       89,594                        103,240          
 Loss on disposal or impairment of assets                                                            25                            183              
 Impairment of goodwill and other intangibles                                                        -                             17,803           
 Deferred income taxes                                                                               (6,428   )                    2,539            
 Non-cash stock compensation expense                                                                 8,906                         6,910            
 Changes in operating assets and liabilities:                                                                                                       
 Accounts receivable                                                                                 (13,925  )                    (2,763    )      
 Other assets                                                                                        756                           (202      )      
 Deferred costs                                                                                      (1,600   )                    (1,879    )      
 Accounts payable and other liabilities                                                              (32,607  )                    7,391            
 Deferred revenue                                                                                    (12,830  )                    14,143           
 Net cash provided by operating activities                                                           75,911                        173,008          
 Cash flows from investing activities:                                                                                                              
 Disposition of operations                                                                           -                             (1,043    )      
 Capitalized software                                                                                (13,190  )                    (3,167    )      
 Capital expenditures                                                                                (21,976  )                    (39,147   )      
 Data acquisition costs                                                                              (6,464   )                    (8,549    )      
 Payments from investments                                                                           -                             370              
 Net cash paid in acquisitions                                                                       -                             (255      )      
 Net cash used by investing activities                                                               (41,630  )                    (51,791   )      
 Cash flows from financing activities:                                                                                                              
 Payments of debt                                                                                    (19,790  )                    (145,768  )      
 Sale of common stock                                                                                7,863                         7,318            
 Acquisition of treasury stock                                                                       (65,356  )                    (42,827   )      
 Contingent consideration paid for prior acquisitions                                                (287     )                    (326      )      
 Net cash used by financing activities                                                               (77,570  )                    (181,603  )      
 Effect of exchange rate changes on cash                                                             (139     )                    (724      )      
                                                                                                                                                    
 Net change in cash and cash equivalents                                                             (43,428  )                    (61,110   )      
 Cash and cash equivalents at beginning of period                                                    229,648                       206,973          
 Cash and cash equivalents at end of period                                                          186,220                       145,863          
                                                                                                                                                    
 Supplemental cash flow information:                                                                                                                
 Cash paid during the period for:                                                                                                                   
 Interest                                                                                            9,678                         15,491           
 Income taxes                                                                                        48,268                        15,171           
 Payments on capital leases and installment payment arrangements                                     12,948                        13,687           
 Payments on software and data license liabilities                                                   337                           616              
 Other debt payments, excluding line of credit                                                       6,505                         6,465            
 Prepayment of debt                                                                                  -                             125,000          
 Noncash investing and financing activities:                                                                                                        
 Acquisition of property and equipment under capital lease and installment payment arrangements      2,157                         8,733            
                                                                                                                                                    


                                                                                                                                                                                                                                                                                                                 
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                                                                                                                                                                                                             
 CALCULATION OF FREE CASH FLOW AVAILABLE TO EQUITY                                                                                                                                                                                                                                                               
 AND RECONCILIATION TO OPERATING CASH FLOW                                                                                                                                                                                                                                                                       
 (Unaudited)                                                                                                                                                                                                                                                                                                     
 (Dollars in thousands)                                                                                                                                                                                                                                                                                          
                                                                                                                                                                                                                                                                                                                 
                                                                                                                                                                                                                                                                                                                 
                                                                      06/30/11              09/30/11              12/31/11              03/31/12              FY2012             06/30/12              09/30/12             12/31/12              YTD FY2013           TTM 12/31/11            TTM 12/31/12      
                                                                                                                                                                                                                                                                                                                 
 Net cash provided (used) by operating activities                     32,754                57,714                82,540                56,443                229,451            (1,867   )            39,235               38,543                75,911               215,043                 132,354           
                                                                                                                                                                                                                                                                                                                 
 Less:                                                                                                                                                                                                                                                                                                           
 Disposition of operations                                            -                     (1,043   )            -                     73,468                72,425             -                     -                    -                     -                    (1,043   )              73,468            
 Capitalized software                                                 (529     )            (991     )            (1,647   )            (2,095   )            (5,262   )         (3,673   )            (4,074  )            (5,443   )            (13,190  )           (4,130   )              (15,285  )        
 Capital expenditures                                                 (12,577  )            (12,134  )            (14,436  )            (12,444  )            (51,591  )         (3,538   )            (8,178  )            (10,260  )            (21,976  )           (51,360  )              (34,420  )        
 Data acquisition costs                                               (2,776   )            (1,774   )            (3,999   )            (3,763   )            (12,312  )         (2,302   )            (1,396  )            (2,766   )            (6,464   )           (11,199  )              (10,227  )        
 Payments on capital leases and installment payment arrangements      (4,794   )            (4,184   )            (4,709   )            (4,644   )            (18,331  )         (4,562   )            (4,384  )            (4,002   )            (12,948  )           (18,939  )              (17,592  )        
 Payments on software and data license liabilities                    (367     )            (124     )            (125     )            (2,300   )            (2,916   )         (129     )            (130    )            (78      )            (337     )           (4,755   )              (2,637   )        
 Other required debt payments                                         (2,151   )            (2,155   )            (2,159   )            (2,164   )            (8,629   )         (2,165   )            (2,168  )            (2,172   )            (6,505   )           (8,619   )              (8,669   )        
                                                                                                                                                                                                                                                                                                                 
 Total                                                                9,560                 35,309                55,465                102,501               202,835            (18,236  )            18,905               13,822                14,491               114,998                 116,992           
                                                                                                                                                                                                                                                                                                                 


                                                                                                                                                                                                                                                                                                                                 
 CONSOLIDATED STATEMENTS OF OPERATIONS                                                                                                                                                                                                                                                                                           
 (Unaudited)                                                                                                                                                                                                                                                                                                                     
 (Dollars in thousands, except earnings per share)                                                                                                                                                                                                                                                                               
                                                                                                                                                                                                                                                                                                                                 
                                                                                                                                                                                                                                                                                        Q3 FY13 to Q3 FY12                       
                                                                                    06/30/11              09/30/11              12/31/11              03/31/12              FY2012               06/30/12              09/30/12              12/31/12              YTD FY2013           %                         $              
 Revenue:                                                                                                                                                                                                                                                                                                                        
 Marketing and data services                                                        184,996               195,857               187,461               203,400               771,714              185,739               194,409               190,138               570,286              1.4     %                 2,677          
 IT Infrastructure management services                                              73,050                73,712                77,173                67,590                291,525              70,290                70,061                69,916                210,267              -9.4    %                 (7,257   )     
 Other services                                                                     17,998                16,863                16,259                16,265                67,385               15,630                12,997                13,048                41,675               -19.7   %                 (3,211   )     
 Total revenue                                                                      276,044               286,432               280,893               287,255               1,130,624            271,659               277,467               273,102               822,228              -2.8    %                 (7,791   )     
                                                                                                                                                                                                                                                                                                                                 
 Operating costs and expenses:                                                                                                                                                                                                                                                                                                   
 Cost of revenue                                                                    218,289               217,487               213,925               213,788               863,489              209,326               209,886               209,027               628,239              -2.3    %                 (4,898   )     
 Selling, general and administrative                                                36,807                39,429                36,318                38,577                151,131              36,749                37,341                37,303                111,393              2.7     %                 985            
 Impairment of goodwill and other intangibles                                       -                     -                     17,803                -                     17,803               -                     -                     -                     -                                              (17,803  )     
 Gains, losses and other items, net                                                 244                   2,465                 (2,671   )            12,600                12,638               160                   32                    (126     )            66                   -95.3   %                 2,545          
                                                                                                                                                                                                                                                                                                                                 
 Total operating costs and expenses                                                 255,340               259,381               265,375               264,965               1,045,061            246,235               247,259               246,204               739,698              -7.2    %                 (19,171  )     
                                                                                                                                                                                                                                                                                                                                 
 Income from operations                                                             20,704                27,051                15,518                22,290                85,563               25,424                30,208                26,898                82,530               73.3    %                 11,380         
 % Margin                                                                           7.5      %            9.4      %            5.5      %            7.8      %            7.6        %         9.4      %            10.9     %            9.8      %            10.0     %                                                    
 Other expense                                                                                                                                                                                                                                                                                                                   
 Interest expense                                                                   (5,455   )            (4,719   )            (3,883   )            (3,391   )            (17,448    )         (3,240   )            (3,317   )            (3,178   )            (9,735   )           18.2    %                 705            
 Other, net                                                                         (87      )            (965     )            (98      )            (219     )            (1,369     )         (547     )            (54      )            565                   (36      )           676.5   %                 663            
 Total other expense                                                                (5,542   )            (5,684   )            (3,981   )            (3,610   )            (18,817    )         (3,787   )            (3,371   )            (2,613   )            (9,771   )           34.4    %                 1,368          
                                                                                                                                                                                                                                                                                                                                 
 Earnings from continuing operations before income taxes                            15,162                21,367                11,537                18,680                66,746               21,637                26,837                24,285                72,759               110.5   %                 12,748         
 Income taxes                                                                       6,063                 9,528                 9,700                 3,838                 29,129               8,438                 10,465                9,836                 28,739               1.4     %                 136            
                                                                                                                                                                                                                                                                                                                                 
 Net earnings from continuing operations                                            9,099                 11,839                1,837                 14,842                37,617               13,199                16,372                14,449                44,020               686.6   %                 12,612         
                                                                                                                                                                                                                                                                                                                                 
 Earnings from discontinued operations, net of tax                                  916                   1,138                 814                   31,031                33,899               -                     -                     -                     -                    -100.0  %                 (814     )     
                                                                                                                                                                                                                                                                                                                                 
 Net earnings                                                                       10,015                12,977                2,651                 45,873                71,516               13,199                16,372                14,449                44,020               445.0   %                 11,798         
                                                                                                                                                                                                                                                                                                                                 
 Less: Net earnings (loss) attributable to noncontrolling interest                  (960     )            685                   (5,279   )            (193     )            (5,747     )         (134     )            (139     )            (76      )            (349     )           -98.6   %                 5,203          
                                                                                                                                                                                                                                                                                                                                 
 Net earnings attributable to Acxiom                                                10,975                12,292                7,930                 46,066                77,263               13,333                16,511                14,525                44,369               83.2    %                 6,595          
                                                                                                                                                                                                                                                                                                                                 
 Diluted earnings per share - net earnings attributable to Acxiom stockholders      0.13                  0.15                  0.10                  0.58                  0.96                 0.17                  0.21                  0.19                  0.58                 90.0    %                 0.09           
                                                                                                                                                                                                                                                                                                                                 


                                                                                                                                                                                                                                                                                      
 ACXIOM CORPORATION AND SUBSIDIARIES                                                                                                                                                                                                                                                  
 RESULTS BY SEGMENT                                                                                                                                                                                                                                                                   
 (Unaudited)                                                                                                                                                                                                                                                                          
 (Dollars in thousands)                                                                                                                                                                                                                                                               
                                                                                                                                                                                                                                                                                      
                                                                                                                                                                                                                                                Q3 FY13 to Q3 FY12                    
                                            06/30/11              09/30/11              12/31/11              03/31/12              FY2012               06/30/12              09/30/12              12/31/12              YTD FY2013           %                       $             
                                                                                                                                                                                                                                                                                      
 Revenue:                                                                                                                                                                                                                                                                             
                                                                                                                                                                                                                                                                                      
 Marketing and data services                184,996               195,857               187,461               203,400               771,714              185,739               194,409               190,138               570,286              1     %                 2,677         
 IT Infrastructure management services      73,050                73,712                77,173                67,590                291,525              70,290                70,061                69,916                210,267              -9    %                 (7,257  )     
 Other services                             17,998                16,863                16,259                16,265                67,385               15,630                12,997                13,048                41,675               -20   %                 (3,211  )     
                                                                                                                                                                                                                                                                                      
 Total revenue                              276,044               286,432               280,893               287,255               1,130,624            271,659               277,467               273,102               822,228              -3    %                 (7,791  )     
                                                                                                                                                                                                                                                                                      
 Income (loss) from operations:                                                                                                                                                                                                                                                       
                                                                                                                                                                                                                                                                                      
 Marketing and data services                17,260                27,078                21,388                30,094                95,820               17,975                23,331                17,971                59,277               -16   %                 (3,417  )     
 IT Infrastructure management services      4,247                 5,091                 9,795                 5,855                 24,988               8,831                 8,520                 9,622                 26,973               -2    %                 (173    )     
 Other services                             (559     )            (2,653   )            (533     )            (1,059   )            (4,804     )         (1,222   )            (1,611   )            (821     )            (3,654   )           54    %                 (288    )     
 Corporate                                  (244     )            (2,465   )            (15,132  )            (12,600  )            (30,441    )         (160     )            (32      )            126                   (66      )           -101  %                 15,258        
                                                                                                                                                                                                                                                                                      
 Total income from operations               20,704                27,051                15,518                22,290                85,563               25,424                30,208                26,898                82,530               73    %                 11,380        
                                                                                                                                                                                                                                                                                      
 Margin:                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                      
 Marketing and data services                9.3      %            13.8     %            11.4     %            14.8     %            12.4       %         9.7      %            12.0     %            9.5      %            10.4     %                                                 
 IT Infrastructure management services      5.8      %            6.9      %            12.7     %            8.7      %            8.6        %         12.6     %            12.2     %            13.8     %            12.8     %                                                 
 Other services                             -3.1     %            -15.7    %            -3.3     %            -6.5     %            -7.1       %         -7.8     %            -12.4    %            -6.3     %            -8.8     %                                                 
                                                                                                                                                                                                                                                                                      
 Total                                      7.5      %            9.4      %            5.5      %            7.8      %            7.6        %         9.4      %            10.9     %            9.8      %            10.0     %                                                 
                                                                                                                                                                                                                                                                                      


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

Copyright Business Wire 2013

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