Acxiom Q4 Earnings Beat Estimates - Analyst Blog

Acxiom Corporation ACXM reported non-GAAP earnings of $18.5 million or 24 cents per share in fourth-quarter fiscal 2014, up from $14.1 million or 19 cents in the year-ago period. The adjusted earnings comfortably beat the Zacks Consensus Estimate of 20 cents.

Non-GAAP earnings in fiscal 2014 stood at $66.2 million or 86 cents, up from $58.5 million or 76 cents in fiscal 2013. The adjusted earnings for fiscal 2014 exceeded the Zacks Consensus Estimate of 82 cents.

The company reported fourth-quarter fiscal 2014 GAAP loss of $29.2 million or loss of 38 cents per share versus income of $13.2 million or 18 cents in the year-ago quarter. The year-over-year decrease in earnings was primarily driven by high impairment charges in the reported quarter.

For fiscal 2014, Acxiom reported GAAP net income of $8.9 million or 12 cents per share versus $57.6 million or 75 cents per share in fiscal 2013.  

Revenues

Total revenue for fourth-quarter fiscal 2014 came in at $277.2 million, flat year over year. Total revenue for the fiscal year ended Mar 31, 2014 was $1,097.5 million versus $1,099.4 million in fiscal 2013.

By segments, sales from the Marketing and Data Services segment improved 3.6% year over year to $209.7 million due to strong performance in the U.S. IT Infrastructure Management Services segment revenues were down 10.0% to $59.0 million. Revenues from Other Services segment were $8.6 million versus $9.4 million year over year.

Margins

Operating loss for the reported quarter stood at $15.1 million versus operating income of $20.2 in the prior-year quarter.

Marketing and Data Services operating margin was 13.0% compared with 10.0% in the previous-year quarter. The IT Infrastructure Management segment reported an operating margin of 6.0%, up from 4.0% in the year-ago quarter, while that of Other Services segment improved to approximately 7% compared to a loss in the prior year.

Significant Quarter Developments

During the reported quarter, Acxiom entered into an agreement to acquire LiveRamp - a leading service provider for onboarding customer data into digital marketing applications for approximately $310 million in cash.

Also Acxiom and comScore entered into a partnership to provide marketers with increased audience reach and media return on investment across multiple channels. Additionally, Acxiom announced a partnership with Marketo Inc to help marketers utilize advanced data insights to tailor marketing content and offers.

Additionally, Acxiom signed 7 new Audience Operating Systems AOS agreements during the quarter with customers in several key industries including Financial Services, Retail and Automotive.

Subsequent to the quarter end, Acxiom announced a partnership with marketing Software Company for social advertisers SHIFT to provide marketers with enhanced approach and the ability to achieve optimal campaign results through the integration of AOS into SHIFT's Open Marketing Cloud platform.

Balance Sheet and Cash Flows

Acxiom ended fiscal 2014 with cash and cash equivalents of $418.6 million compared with $223.0 million in fiscal-end 2013. Long-term debt came in at $289.0 million, up from $237.4 million in fiscal 2013.

Net cash provided by operating activities aggregated $165.0 million during the year ended Mar 31, 2014 compared with $150.1 million in the prior-year period. Free cash flow to equity stood at $76 million for fiscal 2014 compared with $56 million in the prior-year period.

Outlook

For fiscal 2015, management expects revenues to be down approximately 5%. The decline in revenues is expected to be driven by the impact of lost IT infrastructure management customers and the exit of analog paper survey business in Europe.

Earning per share is expected to be in the range of 75 cents to 85 cents. The year-over-year decline in earnings is expected to be driven by lost IT infrastructure management customers and dilution from the acquisition of LiveRamp and other expenses.

Acxiom currently has a Zacks Rank #3 (Hold). Other stocks that appear attractive include CDW Corporation CDW, Barracuda Networks, Inc CUDA and EPAM Systems, Inc EPAM, each carrying Zacks Rank #2 (Buy).