Acxiom Announces Third Quarter Fiscal 2009 Results

Acxiom^® Corporation (NASDAQ: ACXM) today announced financial results for the third quarter of its 2009 fiscal year ended December 31, 2008. Acxiom will hold a conference call at 4:30 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.

Third Quarter 2009 Highlights:

• Revenue of $321.1 million, compared to $350.8 million in the third quarter a year ago.
• Loss from operations of $8.6 million, compared to income from operations of $97.4 million in the third quarter last year. Loss from operations for the current quarter included unusual loss items of $43.2 million. The prior-year quarter included $63.5 million of unusual gain items.
• Loss per diluted share of $0.15, compared to earnings per diluted share of $0.69 in the third quarter of fiscal 2008. Excluding the impact of unusual items, earnings per diluted share would be $0.21 in the current period and $0.20 in the prior-year period.
• Operating cash flow of $78.9 million, compared to $122.3 million in the third quarter a year ago. Operating cash flow for the prior-year quarter includes the proceeds of a $65 million payment received as a result of the termination of the agreement to acquire Acxiom.
• Free cash flow available to equity of $46.8 million compared to $83.9 million in the third quarter a year ago. Free cash flow available to equity in the prior-year quarter includes the proceeds of a $65 million payment received as a result of the termination of the agreement to acquire Acxiom. Free cash flow available to equity is a non-GAAP financial measure; a reconciliation to the comparable GAAP measure, operating cash flow, is attached to this news release.
• The repurchase of approximately 142,500 shares of Acxiom common stock for $1.0 million.

A schedule is attached to this release outlining the impact of the unusual items on the current and prior-year third quarter and current and prior year-to-date results.

John Meyer, Acxiom Corporation’s Chief Executive Officer and President, stated, "Despite the challenging economic environment, our performance was strong during the quarter. In particular, I was pleased with our cash flow generation and operating results, before unusual charges. Credit for these results is largely due to the efforts of Acxiom associates worldwide who have contributed to a more efficient organization while continuing to provide outstanding service to our clients.”

Operational Highlights:

• Information Services: Revenue for the quarter was $231.1 million, compared to $244.6 million in the third quarter of the previous year. Income from operations for the quarter was $43.4 million, compared to $42.7 million in the third quarter of fiscal 2008.
• Information Products: Revenue for the quarter was $90.0 million, compared with $106.1 million in the third quarter of the previous year. Income from operations for the quarter was $9.6 million, compared to $12.0 million in the third quarter of the previous year.
• Corporate and Other Expenses: Corporate and other expenses for the quarter totaled $61.6 million, compared to net gains of $42.6 million for the period ended December 31, 2007. The current quarter includes unusual loss items of $43.2 million. The prior period included unusual gain items of $63.5 million.

Other Third Quarter Highlights

• During the quarter, the company completed the acquisition of Quinetix, LLC, a Rochester, N.Y.-based provider of analytics and predictive modeling for large and medium-size businesses in retail banking, hospitality, media and other industries, for a purchase price of $2.7 million. The acquisition gives Acxiom additional consumer insight capabilities that enable clients to more effectively retain and grow their customer base and optimize pricing.

Outlook

Based on actual results and review of current expectations, the company is updating its fiscal year 2009 estimates as follows:

• Revenue is expected to be in the range of $1.28 billion to $1.3 billion.
• Earnings per diluted share, excluding unusual items, are expected to be in the range of $0.73 to $0.75.
• Free cash flow to equity, which is a non-GAAP measure, is expected to be in the range of $105 million to $115 million.

Web Link to Financials

http://www.acxiom.com/FY09_Q3_Financials is a link to the detailed financial information we typically attach to our earnings releases.

About Acxiom Corporation

A global leader in interactive marketing services, Acxiom connects clients with their customers through deep consumer insight, powering effective and profitable marketing initiatives and business decisions. Our consultative approach spans multiple industries and incorporates decades of experience in consumer data and analytics, information technology, data integration and consulting solutions for effective marketing across digital, Internet, email, mobile and direct mail channels. Founded in 1969, Acxiom is headquartered in Little Rock, Ark., and serves clients around the world from locations in the United States, Europe and Asia-Pacific. For more information about Acxiom, visit www.acxiom.com.

Forward Looking Statements

This release and today’s conference call contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially. Such statements may include but are not necessarily limited to the following: that the projected revenue, earnings per share and free cash flow to equity will be within the estimated ranges for fiscal year 2009. 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 be closed, or may not be closed within the anticipated time frames; the possibility that clients may attempt to reduce the amount of business they do with the company; the possibility that in the event that a change of control of the company was sought that certain of the clients of the company would invoke certain provisions in their contracts resulting in a decline in the revenue and profit of the company; the possibility that certain contracts may not generate the anticipated revenue or profitability; the possibility that negative changes in economic or other conditions might lead to a reduction in demand for our products and services; the possibility of an economic slowdown or that economic conditions in general will not be as expected; the possibility that the historical seasonality of our business may change; the possibility that significant customers may experience extreme, severe economic difficulty; the possibility that the integration of acquired businesses may not be as successful as planned; the possibility that the fair value of certain of our assets may not be equal to the carrying value of those assets now or in future time periods; the possibility that sales cycles may lengthen; the possibility that we may not be able to attract and retain qualified technical and leadership associates, or that we may lose key associates to other organizations; the possibility that we won’t be able to properly motivate our sales force or other associates; the possibility that we won’t be able to achieve cost reductions and avoid unanticipated costs; the possibility that we won’t be able to continue to receive credit upon satisfactory terms and conditions; the possibility that competent, competitive products, technologies or services will be introduced into the marketplace by other companies; the possibility that we may be subjected to pricing pressure due to market conditions and/or competitive products and services; the possibility that there will be changes in consumer or business information industries and markets that negatively impact the company; the possibility that changes in accounting pronouncements may occur and may impact these projections; the possibility that we won’t be able to protect proprietary information and technology or to obtain necessary licenses on commercially reasonable terms; the possibility that we may encounter difficulties when entering new markets or industries; the possibility that there will be changes in the legislative, accounting, regulatory and consumer environments affecting our business, including but not limited to litigation, legislation, regulations and customs relating to our ability to collect, manage, aggregate and use data; the possibility that data suppliers might withdraw data from us, leading to our inability to provide certain products and services; the possibility that we may enter into short-term contracts which would affect the predictability of our revenues; the possibility that the amount of ad hoc, volume-based and project work will not be as expected; the possibility that we may experience a loss of data center capacity or interruption of telecommunication links or power sources; the possibility that we may experience failures or breaches of our network and data security systems, leading to potential adverse publicity, negative customer reaction, or liability to third parties; the possibility that postal rates may increase, thereby leading to reduced volumes of business; the possibility that our clients may cancel or modify their agreements with us; the possibility that 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 we experience processing errors which result in credits to customers, re-performance of services or payment of damages to customers; the possibility that the services of the United States Postal Service, their global counterparts and other delivery systems may be disrupted; and the possibility that we may be affected by other competitive factors.

With respect to the provision of products or services outside our primary base of operations in the 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.

Other factors are detailed from time to time in our periodic reports and registration statements filed with the United States Securities and Exchange Commission. We believe that we have the product and technology offerings, facilities, associates and competitive and financial resources for continued business success, but future revenues, costs, margins and profits are all influenced by a number of factors, including those discussed above, all of which are inherently difficult to forecast.

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

Acxiom is a registered trademark of Acxiom Corporation.

ACXIOM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except earnings (loss) per share)
					For the Three Months Ended
					December 31,
											$			%
					2008			2007			Variance			Variance
Revenue:
Services					231,077			244,646			(13,569	)		(5.5	%)
Products					89,979			106,113			(16,134	)		(15.2	%)
Total revenue					321,056			350,759			(29,703	)		(8.5	%)
Operating costs and expenses:
Cost of revenue
Services					173,433			188,659			15,226			8.1	%
Products					70,487			82,091			11,604			14.1	%
Total cost of revenue					243,920			270,750			26,830			9.9	%
Services gross margin					24.9	%		22.9	%
Products gross margin					21.7	%		22.6	%
Total gross margin					24.0	%		22.8	%
Selling, general and administrative					42,560			46,118			3,558			7.7	%
Gains, losses and other items, net					43,175			(63,489	)		(106,664	)		(168.0	%)
Total operating costs and expenses					329,655			253,379			(76,276	)		(30.1	%)
Income (loss) from operations					(8,599	)		97,380			(105,979	)		(108.8	%)
Other income (expense):
Interest expense					(8,105	)		(12,797	)		4,692			36.7	%
Other, net					140			1,394			(1,254	)		(90.0	%)
Total other income (expense)					(7,965	)		(11,403	)		3,438			30.1	%
Earnings (loss) before income taxes					(16,564	)		85,977			(102,541	)		(119.3	%)
Income taxes					(5,115	)		30,977			36,092			116.5	%
Net earnings (loss)					(11,449	)		55,000			(66,449	)		(120.8	%)
Earnings (loss) per share:
Basic					(0.15	)		0.69			(0.84	)		(121.7	%)
Diluted					(0.15	)		0.69			(0.84	)		(121.7	%)

ACXIOM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Dollars in thousands, except earnings per share)
					For the Nine Months Ended
					December 31,
											$			%
					2008			2007			Variance			Variance
Revenue:
Services					701,377			730,071			(28,694	)		(3.9	%)
Products					279,687			304,211			(24,524	)		(8.1	%)
Total revenue					981,064			1,034,282			(53,218	)		(5.1	%)
Operating costs and expenses:
Cost of revenue
Services					533,280			579,594			46,314			8.0	%
Products					225,242			245,896			20,654			8.4	%
Total cost of revenue					758,522			825,490			66,968			8.1	%
Services gross margin					24.0	%		20.6	%
Products gross margin					19.5	%		19.2	%
Total gross margin					22.7	%		20.2	%
Selling, general and administrative					131,030			130,755			(275	)		(0.2	%)
Gains, losses and other items, net					40,260			(38,167	)		(78,427	)		(205.5	%)
Total operating costs and expenses					929,812			918,078			(11,734	)		(1.3	%)
Income from operations					51,252			116,204			(64,952	)		(55.9	%)
Other income (expense):
Interest expense					(26,155	)		(40,214	)		14,059			35.0	%
Other, net					1,786			2,908			(1,122	)		(38.6	%)
Total other income (expense)					(24,369	)		(37,306	)		12,937			34.7	%
Earnings before income taxes					26,883			78,898			(52,015	)		(65.9	%)
Income taxes					11,829			28,393			16,564			58.3	%
Net earnings					15,054			50,505			(35,451	)		(70.2	%)
Earnings per share:
Basic					0.19			0.63			(0.44	)		(69.8	%)
Diluted					0.19			0.62			(0.43	)		(69.4	%)

ACXIOM CORPORATION AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
(Unaudited)
(Dollars in thousands)
					For the Three Months Ended						For the Nine Months Ended
					December 31,						December 31,
					2008			2007			2008			2007
Amounts excluded as unusual items:
Restructuring - Severance and other payroll costs					12,547			624			12,799			5,984
Restructuring - Lease and facility related					5,215			-			4,491			-
Disposal of software					24,590			-			24,590			-
Merger termination fee					-			(65,000	)		-			(65,000	)
Terminated merger expenses					-			331			-			17,689
Other gains and losses, net					823			556			(1,620	)		3,160
Total of gains, losses and other items					43,175			(63,489	)		40,260			(38,167	)
Asset write-offs included in cost of operations					-			-			-			10,048
Total impact on income (loss) from operations					43,175			(63,489	)		40,260			(28,119	)
Joint venture gain included in other income					-			-			(1,089	)		-
Total impact on earnings (loss) before income taxes					43,175			(63,489	)		39,171			(28,119	)
Tax effect of excluded items					15,493			(24,496	)		13,932			(11,018	)
Total impact on net earnings (loss)					27,682			(38,993	)		25,239			(17,101	)
Total impact on earnings (loss) per share					0.36			(0.49	)		0.33			(0.21	)
Income (loss) from operations					(8,599	)		97,380			51,252			116,204
Impact calculated above					43,175			(63,489	)		40,260			(28,119	)
Income from operations before excluded items					34,576			33,891			91,512			88,085
Earnings (loss) before income taxes					(16,564	)		85,977			26,883			78,898
Impact calculated above					43,175			(63,489	)		39,171			(28,119	)
Earnings before income taxes before excluded items					26,611			22,488			66,054			50,779
Net earnings (loss)					(11,449	)		55,000			15,054			50,505
Impact calculated above					27,682			(38,993	)		25,239			(17,101	)
Net earnings before excluded items					16,233			16,007			40,293			33,404
Diluted earnings (loss) per share					(0.15	)		0.69			0.19			0.62
Impact calculated above					0.36			(0.49	)		0.33			(0.21	)
Diluted earnings per share before excluded items					0.21			0.20			0.52			0.41

ACXIOM CORPORATION AND SUBSIDIARIES
CALCULATION OF EARNINGS PER SHARE
(Unaudited)
(In thousands, except earnings (loss) per share)
						For the Three Months Ended
						December 31,			December 31,
						2008			2007
Basic earnings (loss) per share:
Numerator - net earnings (loss)						(11,449	)		55,000
Denominator - weighted-average shares outstanding						78,086			79,418
Basic earnings (loss) per share						(0.15	)		0.69
Diluted earnings (loss) per share:
Numerator - net earnings (loss)						(11,449	)		55,000
Denominator - weighted-average shares outstanding						78,086			79,418
Dilutive effect of common stock options, warrants and restricted stock						-			253
						78,086			79,671
Diluted earnings (loss) per share						(0.15	)		0.69

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,
						2008		2007
Basic earnings per share:
Numerator - net earnings						15,054		50,505
Denominator - weighted-average shares outstanding						77,735		79,802
Basic earnings per share						0.19		0.63
Diluted earnings per share:
Numerator - net earnings						15,054		50,505
Denominator - weighted-average shares outstanding						77,735		79,802
Dilutive effect of common stock options, warrants and restricted stock						345		1,380
						78,080		81,182
Diluted earnings per share						0.19		0.62

ACXIOM CORPORATION AND SUBSIDIARIES
RESULTS BY SEGMENT
(Unaudited)
(Dollars in thousands)
					For the Three Months Ended
					December 31,			December 31,
Revenue:					2008			2007
Information services					231,077			244,646
Information products					89,979			106,113
Total revenue					321,056			350,759
Income from operations:
Information services					43,436			42,723
Information products					9,585			12,047
Corporate & other					(61,620	)		42,610
Total income (loss) from operations					(8,599	)		97,380
Margin:
Information services					18.8	%		17.5	%
Information products					10.7	%		11.4	%
Total margin					-2.7	%		27.8	%

ACXIOM CORPORATION AND SUBSIDIARIES
RESULTS BY SEGMENT
(Unaudited)
(Dollars in thousands)
					For the Nine Months Ended
					December 31,			December 31,
Revenue:					2008			2007
Information services					701,377			730,071
Information products					279,687			304,211
Total revenue					981,064			1,034,282
Income from operations:
Information services					122,711			112,652
Information products					22,648			25,885
Corporate & other					(94,107	)		(22,333	)
Total income from operations					51,252			116,204
Margin:
Information services					17.5	%		15.4	%
Information products					8.1	%		8.5	%
Total margin					5.2	%		11.2	%

ACXIOM CORPORATION AND SUBSIDIARIES
PRODUCTS REVENUE AND COST OF PRODUCTS SUPPLEMENTAL SCHEDULE
(Unaudited)
(Dollars in thousands)
			For the Three Months Ended
			December 31,			December 31,			$			%
			2008			2007			Variance			Variance
Products			69,892			85,636			(15,744	)		(18.4	%)
Passthrough data			20,087			20,477			(390	)		(1.9	%)
Total products revenue			89,979			106,113			(16,134	)		(15.2	%)
Cost of products revenue:
Products			50,400			61,614			11,214			18.2	%
Passthrough data			20,087			20,477			390			1.9	%
Total cost of products			70,487			82,091			11,604			14.1	%
Margin:
Products			27.9	%		28.1	%
Passthrough data			0.0	%		0.0	%
Total products			21.7	%		22.6	%

ACXIOM CORPORATION AND SUBSIDIARIES
PRODUCTS REVENUE AND COST OF PRODUCTS SUPPLEMENTAL SCHEDULE
(Unaudited)
(Dollars in thousands)
			For the Nine Months Ended
			December 31,			December 31,			$			%
			2008			2007			Variance			Variance
Products			215,838			244,303			(28,465	)		(11.7	%)
Passthrough data			63,849			59,908			3,941			6.6	%
Total products revenue			279,687			304,211			(24,524	)		(8.1	%)
Cost of products revenue:
Products			161,393			185,988			24,595			13.2	%
Passthrough data			63,849			59,908			(3,941	)		(6.6	%)
Total cost of products			225,242			245,896			20,654			8.4	%
Margin:
Products			25.2	%		23.9	%
Passthrough data			0.0	%		0.0	%
Total products			19.5	%		19.2	%

ACXIOM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands)
		December 31,			March 31,			$			%
		2008			2008			Variance			Variance
Assets
Current assets:
Cash and cash equivalents		138,075			62,661			75,414			120.4	%
Trade accounts receivable, net		212,841			216,462			(3,621	)		(1.7	%)
Refundable income taxes		6,133			16,080			(9,947	)		(61.9	%)
Deferred income taxes		47,411			44,211			3,200			7.2	%
Other current assets		42,192			45,645			(3,453	)		(7.6	%)
Total current assets		446,652			385,059			61,593			16.0	%
Property and equipment		738,289			765,046			(26,757	)		(3.5	%)
Less - accumulated depreciation and amortization		523,486			498,777			24,709			5.0	%
Property and equipment, net		214,803			266,269			(51,466	)		(19.3	%)
Software, net of accumulated amortization		53,900			59,263			(5,363	)		(9.0	%)
Goodwill		467,467			484,796			(17,329	)		(3.6	%)
Purchased software licenses, net of accumulated amortization		63,730			111,574			(47,844	)		(42.9	%)
Deferred costs, net		76,371			90,707			(14,336	)		(15.8	%)
Data acquisition costs		34,594			51,566			(16,972	)		(32.9	%)
Other assets, net		21,518			22,621			(1,103	)		(4.9	%)
		1,379,035			1,471,855			(92,820	)		(6.3	%)
Liabilities and Stockholders' Equity
Current liabilities:
Current installments of long-term debt		44,341			69,259			(24,918	)		(36.0	%)
Trade accounts payable		33,867			45,749			(11,882	)		(26.0	%)
Accrued payroll and related expenses		45,333			39,061			6,272			16.1	%
Other accrued expenses		109,115			121,441			(12,326	)		(10.1	%)
Deferred revenue		57,200			64,116			(6,916	)		(10.8	%)
Total current liabilities		289,856			339,626			(49,770	)		(14.7	%)
Long-term debt		535,759			575,308			(39,549	)		(6.9	%)
Deferred income taxes		57,089			51,429			5,660			11.0	%
Other liabilities		9,129			4,980			4,149			83.3	%
Stockholders' equity:
Common stock		11,526			11,428			98			0.9	%
Additional paid-in capital		795,419			779,815			15,604			2.0	%
Retained earnings		419,500			413,758			5,742			1.4	%
Accumulated other comprehensive income		(586	)		33,976			(34,562	)		(101.7	%)
Treasury stock, at cost		(738,657	)		(738,465	)		(192	)		0.0	%
Total stockholders' equity		487,202			500,512			(13,310	)		(2.7	%)
		1,379,035			1,471,855			(92,820	)		(6.3	%)

ACXIOM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
		For the Three Months Ended
		December 31,
		2008			2007
Cash flows from operating activities:
Net earnings (loss)		(11,449	)		55,000
Non-cash operating activities:
Depreciation and amortization		49,677			57,424
Loss (gain) on disposal or impairment of assets, net		25,896			(2,643	)
Deferred income taxes		(2,784	)		2,277
Non-cash stock compensation expense		1,807			2,648
Changes in operating assets and liabilities:
Accounts receivable		1,958			8,074
Other assets		(6,940	)		17,777
Deferred costs		(918	)		(7,826	)
Accounts payable and other liabilities		21,107			3,297
Deferred revenue		559			(13,759	)
Net cash provided by operating activities		78,913			122,269
Cash flows from investing activities:
Disposition of operations		-			14,250
Capitalized software		(3,872	)		(8,507	)
Capital expenditures		(6,232	)		(6,891	)
Data acquisition costs		(7,825	)		(9,634	)
Payments received from investments		-			1,804
Net cash paid in acquisitions		(2,700	)		(3,720	)
Net cash used by investing activities		(20,629	)		(12,698	)
Cash flows from financing activities:
Payments of debt		(14,193	)		(49,380	)
Dividends paid		-			(4,850	)
Sale of common stock		2,447			2,711
Tax benefit of stock options exercised		-			25
Acquisition of treasury stock		(655	)		(45,565	)
Net cash used by financing activities		(12,401	)		(97,059	)
Effect of exchange rate changes on cash		(1,178	)		(78	)
Net increase in cash and cash equivalents		44,705			12,434
Cash and cash equivalents at beginning of period		93,370			53,831
Cash and cash equivalents at end of period		138,075			66,265
Supplemental cash flow information:
Cash paid (received) during the period for:
Interest		8,047			12,270
Income taxes		2,901			(4,742	)
Payments on capital leases and installment payment arrangements		9,033			17,542
Payments on software and data license liabilities		3,099			6,226
Other debt payments, excluding line of credit		2,061			5,612
Prepayment of debt		-			20,000
Noncash investing and financing activities:
Acquisition of property and equipment under capital lease and installment payment arrangements		2,233			5,004
Disposal of assets under capital lease		-			(5,304	)
Construction and other financing		-			3,995
Assets acquired under data obligation		-			15,306

ACXIOM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)
		For the Nine Months Ended
		December 31,
		2008			2007
Cash flows from operating activities:
Net earnings		15,054			50,505
Non-cash operating activities:
Depreciation and amortization		154,297			177,345
Loss (gain) on disposal or impairment of assets, net		22,654			(2,717	)
Deferred income taxes		5,069			(1,464	)
Non-cash stock compensation expense		8,040			5,678
Changes in operating assets and liabilities:
Accounts receivable		(9,377	)		3,628
Other assets		13,875			19,163
Deferred costs		(2,986	)		(20,598	)
Accounts payable and other liabilities		(6,222	)		4
Deferred revenue		(6,215	)		(42,272	)
Net cash provided by operating activities		194,189			189,272
Cash flows from investing activities:
Disposition of operations		-			14,250
Sale of assets		24,174			-
Capitalized software		(13,001	)		(26,774	)
Capital expenditures		(19,183	)		(15,049	)
Cash collected from sale of software		2,000			-
Data acquisition costs		(22,954	)		(22,621	)
Payments received from investments		2,596			3,603
Net cash paid in acquisitions		(15,403	)		(9,191	)
Net cash used by investing activities		(41,771	)		(55,782	)
Cash flows from financing activities:
Proceeds from debt		-			2,127
Payments of debt		(73,694	)		(108,009	)
Dividends paid		(9,312	)		(4,850	)
Sale of common stock		8,362			44,812
Tax benefit of stock options exercised		115			5,993
Acquisition of treasury stock		(655	)		(45,565	)
Net cash used by financing activities		(75,184	)		(105,492	)
Effect of exchange rate changes on cash		(1,820	)		491
Net increase in cash and cash equivalents		75,414			28,489
Cash and cash equivalents at beginning of period		62,661			37,776
Cash and cash equivalents at end of period		138,075			66,265
Supplemental cash flow information:
Cash paid (received) during the period for:
Interest		24,468			40,008
Income taxes		(3,029	)		(4,953	)
Payments on capital leases and installment payment arrangements		33,116			54,330
Payments on software and data license liabilities		19,887			19,998
Other debt payments, excluding line of credit		6,191			11,554
Prepayment of debt		14,500			20,000
Revolving credit payments		-			2,127
Noncash investing and financing activities:
Acquisition of property and equipment under capital lease and installment payment arrangements		7,892			20,724
Disposal of assets under capital lease		-			(5,304	)
Construction and other financing		-			9,346
Software licenses and maintenance acquired under software obligation		1,546			493
Assets acquired under data obligation		-			15,306
Note payable issued in acquisition		-			300

ACXIOM CORPORATION AND SUBSIDIARIES
CALCULATION OF FREE CASH FLOW AVAILABLE TO EQUITY
AND RECONCILIATION TO OPERATING CASH FLOW
(Unaudited)
(Dollars in thousands)
			06/30/07			09/30/07			12/31/07			03/31/08			YTD FY2008			06/30/08			09/30/08			12/31/08			YTD FY2009
Net cash provided by operating activities			33,587			33,416			122,269			78,534			267,806			28,473			86,803			78,913			194,189
Plus:
	Sale of assets		-			-			-			-			-			-			24,174			-			24,174
	Payments received from investments		-			1,799			1,804			-			3,603			2,494			102			-			2,596
	Disposition of operations		-			-			14,250			-			14,250			-			-			-			-
Less:
	Capitalized software		(8,447	)		(9,820	)		(8,507	)		(6,571	)		(33,345	)		(5,011	)		(4,118	)		(3,872	)		(13,001	)
	Capital expenditures		(2,867	)		(5,291	)		(6,891	)		(6,551	)		(21,600	)		(5,706	)		(7,245	)		(6,232	)		(19,183	)
	Data acquisition costs		(8,623	)		(4,403	)		(9,634	)		(9,503	)		(32,163	)		(8,622	)		(6,507	)		(7,825	)		(22,954	)
	Payments on capital leases and installment payment arrangements		(19,137	)		(17,651	)		(17,542	)		(15,376	)		(69,706	)		(12,879	)		(11,204	)		(9,033	)		(33,116	)
	Payments on software and data license liabilities		(6,493	)		(7,279	)		(6,226	)		(11,821	)		(31,819	)		(8,368	)		(8,420	)		(3,099	)		(19,887	)
	Other required debt payments		(3,526	)		(2,416	)		(5,612	)		(13,492	)		(25,046	)		(2,057	)		(2,073	)		(2,061	)		(6,191	)
Subtotal			(15,506	)		(11,645	)		83,911			15,220			71,980			(11,676	)		71,512			46,791			106,627
Plus:
	Tax benefit of stock options and warrants		5,624			344			25			(480	)		5,513			60			55			-			115
Subtotal			(9,882	)		(11,301	)		83,936			14,740			77,493			(11,616	)		71,567			46,791			106,742
Plus:
	Cash collected from sale of software		-			-			-			-			-			2,000			-			-			2,000
Total			(9,882	)		(11,301	)		83,936			14,740			77,493			(9,616	)		71,567			46,791			108,742

	ACXIOM CORPORATION AND SUBSIDIARIES
	CONSOLIDATED STATEMENTS OF OPERATIONS
	(Unaudited)
	(Dollars in thousands, except earnings per share)
																											Q3 FY08 to Q3 FY09
			06/30/07			09/30/07			12/31/07			03/31/08			FY2008			06/30/08			09/30/08			12/31/08			%			$
Revenue:
	Services		240,392			245,033			244,646			239,700			969,771			236,695			233,605			231,077			-5.5	%		(13,569	)
	Products		94,277			103,821			106,113			110,097			414,308			94,378			95,330			89,979			-15.2	%		(16,134	)
	Total revenue		334,669			348,854			350,759			349,797			1,384,079			331,073			328,935			321,056			-8.5	%		(29,703	)
Operating costs and expenses:
	Cost of revenue
	Services		194,602			196,333			188,659			225,776			805,370			178,861			180,986			173,433			8.1	%		15,226
	Products		82,003			81,802			82,091			78,964			324,860			77,717			77,038			70,487			14.1	%		11,604
	Total cost of revenue		276,605			278,135			270,750			304,740			1,130,230			256,578			258,024			243,920			9.9	%		26,830
	Selling, general and administrative		42,035			42,602			46,118			46,496			177,251			49,482			38,988			42,560			7.7	%		3,558
	Gains, losses and other items, net		15,390			9,932			(63,489	)		74,519			36,352			(545	)		(2,370	)		43,175			-168.0	%		(106,664	)
	Total operating costs and expenses		334,030			330,669			253,379			425,755			1,343,833			305,515			294,642			329,655			-30.1	%		(76,276	)
	Income (loss) from operations		639			18,185			97,380			(75,958	)		40,246			25,558			34,293			(8,599	)		-108.8	%		(105,979	)
	% Margin		0.2	%		5.2	%		27.8	%		-21.7	%		2.9	%		7.7	%		10.4	%		-2.7	%
	Other income (expense)
	Interest expense		(13,575	)		(13,842	)		(12,797	)		(11,016	)		(51,230	)		(9,459	)		(8,591	)		(8,105	)		36.7	%		4,692
	Other, net		183			1,331			1,394			(1,685	)		1,223			1,359			287			140			-90.0	%		(1,254	)
	Total other income (expense)		(13,392	)		(12,511	)		(11,403	)		(12,701	)		(50,007	)		(8,100	)		(8,304	)		(7,965	)		30.1	%		3,438
	Earnings (loss) before income taxes		(12,753	)		5,674			85,977			(88,659	)		(9,761	)		17,458			25,989			(16,564	)		-119.3	%		(102,541	)
	Income taxes		937			(3,521	)		30,977			(30,374	)		(1,981	)		6,808			10,033			(5,115	)		116.5	%		36,092
	Net earnings (loss)		(13,690	)		9,195			55,000			(58,285	)		(7,780	)		10,650			15,956			(11,449	)		-120.8	%		(66,449	)
	Diluted earnings (loss) per share		(0.17	)		0.11			0.69			(0.76	)		(0.10	)		0.14			0.20			(0.15	)		-121.7	%		(0.84	)

ACXIOM CORPORATION AND SUBSIDIARIES
RESULTS BY SEGMENT
(Unaudited)
(Dollars in thousands)
																											Q3 FY08 to Q3 FY09
			06/30/07			09/30/07			12/31/07			03/31/08			FY2008			06/30/08			09/30/08			12/31/08			%			$
Revenue:
	Services		240,392			245,033			244,646			239,700			969,771			236,695			233,605			231,077			-5.5	%		(13,569	)
	Products		94,277			103,821			106,113			110,097			414,308			94,378			95,330			89,979			-15.2	%		(16,134	)
	Total revenue		334,669			348,854			350,759			349,797			1,384,079			331,073			328,935			321,056			-8.5	%		(29,703	)
Income from Operations:
	Services		34,070			35,859			42,723			1,022			113,674			38,626			40,649			43,436			1.7	%		713
	Products		2,164			11,674			12,047			19,858			45,743			4,578			8,485			9,585			-20.4	%		(2,462	)
	Corporate & Other		(35,595	)		(29,348	)		42,610			(96,837	)		(119,170	)		(17,646	)		(14,841	)		(61,620	)		-244.6	%		(104,230	)
	Total Income from Operations		639			18,185			97,380			(75,957	)		40,247			25,558			34,293			(8,599	)		-108.8	%		(105,979	)
Margin:
	Services		14.2	%		14.6	%		17.5	%		0.4	%		11.7	%		16.3	%		17.4	%		18.8	%
	Products		2.3	%		11.2	%		11.4	%		18.0	%		11.0	%		4.9	%		8.9	%		10.7	%
	Total		0.2	%		5.2	%		27.8	%		-21.7	%		2.9	%		7.7	%		10.4	%		-2.7	%