UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): July 11, 2006
ACXIOM CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
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0-13163 |
71-0581897 |
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(Commission File Number) |
(IRS Employer Identification No.) | |||
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1 Information Way, P.O. Box 8180, Little Rock, Arkansas |
72203-8180 | ||
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(Address of Principal Executive Offices) |
(Zip Code) |
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501-342-1000
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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o |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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X |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 8.01 |
Other Events |
EXPLANATORY NOTE
This Current Report on Form 8-K/A is being filed as Amendment No. 1 to our Current Report on Form 8-K, which was filed with the Securities and Exchange Commission on July 11, 2006 (the “Original Filing”). We are filing this Amendment No. 1 to correct the date included in Exhibit 99.1 to the Original Filing.
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Item 9.01 |
Financial Statements and Exhibits |
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(c) |
Exhibits |
The following exhibits are furnished herewith:
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Exhibit |
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Description |
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99.1 |
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Acxiom Investor Briefing presentation. |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Dated: |
July 11, 2006 |
ACXIOM CORPORATION
By: /s/ Jerry C. Jones
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Name: |
Jerry C. Jones |
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Title: |
Business Development/Legal Leader | |
EXHIBIT INDEX
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Exhibit |
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Description | |
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99.1 |
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Acxiom Investor Briefing presentation. | |
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Acxiom Investor Briefing
July 11, 2006
Copyright © 2006 Acxiom Corporation. All Rights Reserved.
Safe Harbor for Forward-Looking Statements
Statements in this presentation by Acxiom Corporation regarding its future financial and operating results, future opportunities for Acxiom, the potential market price of Acxiom stock, Acxiom's international operations and any other statements about management's future expectations, beliefs, goals, plans or prospects constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words "believes," "plans," "anticipates," "expects," estimates and similar expressions) should also be considered to be forward-looking statements. There are a number of important factors that could cause actual results or events to differ materially from those indicated by such forward-looking statements, including competitive pressures, adverse economic conditions, governmental regulations and other factors described in Acxiom's Annual Report on Form 10-K for the year ended March 31, 2006 and other reports that Acxiom files with the SEC. Acxiom disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this presentation.
Additional Information and Where to Find It
In connection with its 2006 annual meeting of stockholders, Acxiom Corporation will file a notice of annual meeting and proxy statement with the Securities and Exchange Commission (“SEC”). STOCKHOLDERS OF ACXIOM ARE URGED TO READ THE NOTICE OF ANNUAL MEETING AND PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Investors and stockholders can obtain free copies of the notice of annual meeting and proxy statement and other documents when they become available by contacting investor relations at investor.relations@acxiom.com or by mail at Acxiom Corporation Investor Relations, 1 Information Way, Little Rock, Arkansas, 72202, or by telephone at 1-501-342-1321. In addition, documents filed with the SEC by Acxiom are available free of charge at the SEC’s website at www.sec.gov.
Acxiom Corporation and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the stockholders of Acxiom in connection with the 2006 annual meeting of stockholders. Information regarding the special interests of these directors and executive officers in the proposed election of directors will be included in Acxiom’s notice of annual meeting and proxy statement for its 2006 annual meeting. This document will be available free of charge at the SEC’s website at www.sec.gov and from Investor Relations at Acxiom as described above.
Non-GAAP Financial Measures
Our discussion today will include non-GAAP financial measures. We refer you to the Investor Relations section of our website, which includes a reconciliation to the comparable GAAP measure for each non-GAAP financial measure included in this discussion. The location of our website is www.acxiom.com.
2
Introduction
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Acxiom’s growth has been fueled by world-leading companies who count on service and innovation |
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Market trends in each of Acxiom’s core business lines support recent investments and future plans |
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Acxiom share price has outperformed competitors and market indices over the last three years |
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Acxiom’s management team is critical to monetizing key investments |
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Acxiom has strengthened its financial leadership and Board of Directors |
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Acxiom’s plan will drive superior shareholder returns |
We ask for your support for the Company’s director nominees in the upcoming shareholder vote
3
The Acxiom Corporation...What We Do
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We Help Our Clients Drive Profitability by: |
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Retaining Existing Customers |
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Finding New Customers |
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Cross-Selling Products and Services |
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Mitigating Risk and Fraud |
¦
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In Doing So, We Provide: |
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Customer Management Solutions |
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Information Management Solutions |
¦
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To the World’s Largest Companies |
4
Blue-Chip Clients and Partners
[LOGOS shown in presentation]
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GE |
CapitalOne® |
citigroup |
Sprint® Together with NEXTEL | |
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IBM® |
GM |
JPMorganChase |
EQUIFAX | |
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DELUXE |
Sears |
accenture |
Baxter | |
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hp invent |
EMC2 where information lives |
E•FUNDSSM |
TransUnionSM | |
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HSBC |
Guideposts |
Federated DEPARTMENT STORES, INC. |
IRI Information Resources, Inc. | |
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Polk® Multi-Dimensional IntelligenceTM |
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5
20 Years of Superior Revenue Growth
Investments Have Fueled Strong Revenue Growth
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R e v e n u e
(i n
M i l l i o n s) |
$ |
1,400 |
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$1,333 | |
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$ |
1,200 |
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20.5% CAGR |
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$1,223 |
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$ |
1,000 |
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$1,010 |
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$1,011 |
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$964 |
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$958 |
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$866 |
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$ |
800 |
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$730 |
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$ |
600 |
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$465 |
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$ |
400 |
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$402 |
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$270 |
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$ |
200 |
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$202 |
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$152 |
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$116 |
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$98 |
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$90 |
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$91 |
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$74 |
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$56 |
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$38 |
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$ |
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1987 |
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1988 |
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1989 |
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1990 |
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1991 |
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1992 |
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1994 |
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1995 |
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1996 |
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1997 |
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1998 |
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1999 |
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2000 |
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2001 |
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2002(1) |
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2003 |
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2004 |
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2005 |
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(1) Revenue recognition changed in fiscal 2001 in accordance with SAB 101. | ||||||||||||||||||||||||||||||||||||||||||
6
The Transformation of Acxiom
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Data Products |
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Data, Analytics & Consulting |
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» |
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Credit Card Databases |
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Multiple Industries |
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Enterprise Solutions |
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Digital & Risk Solutions |
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Batch Processing |
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Real Time Processing |
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Mainframes |
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» |
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Grid Technology |
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Independent Business Units |
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Integrated Organization |
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Technology Re-Engineering |
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Outsourcing |
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Non-Hosted Solutions |
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» |
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Arkansas-Centric |
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Global Business |
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1999 |
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2000 |
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2001 |
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2002 |
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2003 |
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2004 |
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2005 |
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2006 |
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Acxiom acquires largest competitor- May & Speh |
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AbiliTec Achieves Industry Leadership
Acxiom Purchases Computer Graphics |
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Acxiom Begins Grid Development |
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Acxiom Enters Risk Business – Purchases AISS |
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Acxiom Invents Personicx
Acxiom Deploys Grid |
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Acxiom Expands in Europe
Acxiom Standardizes Operational Functonality |
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Acxiom Enters China
Acxiom Goes Online |
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Acxiom Expands into Risk Mitigation |
7
Acxiom Sees Growing Demand for its Core Competencies
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Data, Analytics and Consulting |
• Business intelligence • Clients’ demand for value-added services • Adoption of analytics outside financial services & insurance
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Enterprise Solutions |
• Customer Data Integration (CDI) • Enterprise database solutions • Enterprise decision management
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Digital Solutions
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• Online & search advertising • Use of demographic information • Interactive marketing / search engine optimization
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Risk Solutions
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• Identity fraud • Pre- & post-employment screening • Law enforcement and security markets
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Grid Technology
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• Complexity of clients’ existing infrastructure • Grid-based service-oriented architecture • Information storage requirements
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Acxiom has positioned itself through key investments to take
advantage of these opportunities
8
Acxiom’s Share Price has Outperformed Market Indices and Peers Over the Past 3 Years(1)
|
Dun & Bradstreet |
68.3% |
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Acxiom |
45.3% |
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Harte Hanks |
37.2% |
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NASDAQ |
29.6% |
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S&P 500 |
29.3% |
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Equifax |
28.9% |
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InfoUSA |
27.4% |
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ChoicePoint |
12.1% |
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Fair Isaac |
2.2% |
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(1) |
For the three years ending 7/6/06. |
9
Acxiom’s Execution of its Strategy has Driven Superior Financial Performance over the Last Year
|
($Millions, Except EPS) |
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Revenue |
YoY Growth |
EPS |
YOY Growth |
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Q1 – ’06 |
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$310.3 |
--- |
$0.07 |
--- |
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Q2 – ’06 |
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330.5 |
10% |
0.20 |
0% |
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Q3 – ’06 |
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347.4 |
11% |
0.31 |
29% |
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Q4 – ’06 |
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344.3 |
7% |
0.26 |
63% |
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2006 |
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1,332.6 |
9% |
0.83 |
12% |
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Q1 – ’07 |
(Analyst |
333.6 |
8% |
0.17 |
143% |
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consensus |
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estimates) |
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10 |
Revenue Growth (Financial Road Map Mid Point)
($ Millions)
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CAGR |
Key Initiatives | |||||
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• Customized Enterprise-wide Services • Industry Specific Solutions • Digital Solutions
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$ |
2,000 |
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$1,864 |
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$ |
1,800 |
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9% |
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$ |
1,600 |
|
|
|
Marketing |
|
|
|
|
|
|
|
9% |
& CDI |
|
• Focus on Analytics • Building Consulting Practices • U.S. Data Growing at 11% CAGR
|
|
$ |
1,400 |
|
$1,333 |
|
Services |
| |
|
|
|
|
|
|
|
| |
|
$ |
1,200 |
|
Marketing |
|
|
| |
|
|
|
|
& CDI |
|
|
| |
|
$ |
1,000 |
|
Services |
|
|
|
|
|
|
|
|
|
5% |
|
|
• Deployment of the Grid • Avoid Commoditized Services • Optimize Capital Allocations
|
|
$ |
800 |
|
|
|
Data |
| |
|
|
|
|
|
|
|
| |
|
$ |
600 |
|
Data |
9% |
|
| |
|
|
|
|
|
|
IT/Data |
| |
|
$ |
400 |
|
|
|
Factory |
|
|
|
|
|
|
IT/Data |
|
Services |
|
• Extensive Cross-Sell Approach • Enhanced Product Set • Innovation and New Markets
|
|
$ |
200 |
|
Factory |
|
|
| |
|
|
|
|
Services |
23% |
Risk |
| |
|
$ |
0 |
|
|
|
Mitigation |
| |
|
|
|
|
FY2006 |
|
FY2010 |
|
|
11
Operating Income Improvement Through Revenue Growth and Expense Efficiencies
($ Millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
2,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
1,800 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
320 |
|
|
|
|
|
17% |
$309 |
|
|
|
|
|
|
|
|
|
|
Margin |
|
|
• Workforce Initiatives • Computer Expense Focus • Standardized Processes • Leveraging Base Assets |
|
$ |
280 |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
| |
|
$ |
240 |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
13% |
$242 |
|
|
|
$ |
200 |
|
|
|
13% |
$186 |
|
|
|
|
|
|
|
|
|
|
Margin |
|
|
|
|
|
|
$ |
160 |
|
|
|
|
|
|
|
|
|
|
|
|
11% |
147%(1) |
|
11% |
|
|
|
|
|
|
$ |
120 |
Margin |
|
$146 |
Margin |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
80 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
0 |
|
|
|
|
|
|
|
|
|
|
|
FY 2006 |
|
FY2007 |
|
FY2010 |
| ||||
(1) Adjusted operating income is a non-GAAP financial measure. This measure excludes $15.8 million of restructuring changes and other unusual items.
12
Grid Positively Impacting Expense Efficiency
|
Computer and Related Expenses (% of Revenue) |
|
| ||||
|
|
|
| ||||
|
2003 |
31% | |||||
|
2004 |
26% | |||||
|
2005 |
23% | |||||
|
2006 |
22% | |||||
Return on Invested Capital
Road Map Midpoint
|
2003 |
6.1% |
|
2004 |
9.4% |
|
2005 |
11.0% |
|
2006 |
11.4% |
|
2010E |
17.5% |
|
|
| ||
|
|
• 100% of new services deals utilize the Grid • Data transformation throughput increased 2x • CDI processing speed increased 6.6x • Data products build time reduced 8x |
| |
13
Standardization Positively Impacting Efficiency
Average Cost per Customer Work Unit Processed
|
|
Avg. Q2 FY06 |
Avg. Q3 FY06 |
Avg. Q4 FY06 |
Avg. Q1 FY07 |
|
All Other Platforms |
$142 |
$172 |
$123 |
$137 |
|
Standardized Platform |
$32 |
$40 |
$25 |
$20 |
|
| ||||
|
• 72 Services and 580 Data Clients on Standard Platform • 35% of Customer Work Units Converted to Standard Platform • Associate Efficiency Improvement of 22% |
| |||
14
Roadmap Upside Opportunities
Acxiom is focused on breakthrough opportunities to accelerate growth
|
Business Information Grid • $60B market not penetrated by hosted business • EMC brings R&D, brand and 7,500 sales people • $350M opportunity in 5 years
|
Digital Markets • Online advertising - $18B market growing at 30% • Requires combination of data, analytics, • $100M – $200M opportunity in 5 years
|
|
Risk Mitigation • Additional $250M market in 5 years • Applications in account access, money transfer • $70M opportunity in 5 years
|
Geographic Expansion • Canada, Latin / South America, Asia Pacific • Leverage existing investments • $140M opportunity in 5 years
|
15
Acxiom Has a Highly Talented Management Team of Seasoned Industry Experts
|
Charles Morgan | ||||||||||
|
CEO / Chairman of the Board | ||||||||||
|
|
|
| ||||||||
|
Operations
|
Finance
|
Corporate Office
| ||||||||
|
Lee Hodges COO
|
Frank Cotroneo CFO
|
Cindy Childers Organizational Development | ||||||||
|
|
|
|
Dathan Gaskill Corporate Finance
|
Richard Howe Marketing & Strategy
| ||||||
|
Client Services
|
Lines of Business
|
Delivery, Technology and Support
|
|
Jerry Jones Legal/Business Development
| ||||||
|
David Allen European Operations
|
Ron Fournet Risk Mitigation
|
Alex Dietz Products & Infrastructure
|
Rodger Kline Administration
| |||||||
|
Jeff Stalnaker Financial Services
|
Scott Hambuchen CDI & Marketing Services
|
Michael Lloyd Delivery Center
|
Jim Womble Business Development
| |||||||
|
Martin Sunde Multi-Industry
|
William Park Data, Digital & Direct
|
Thomas Walker, Jr. IT Services
|
Kevin Zaffaroni Strategic Initiatives
| |||||||
|
|
|
Holly Marr Business Planning
|
|
|
| |||||
o Foundational / Promoted from Within
o Professional Recruit / Acquisition
16
New Financial Leadership
|
|
• |
In May 2006, Frank Cotroneo joined Acxiom as CFO |
|
|
• |
Frank was previously CFO at MasterCard International and H&R Block |
|
|
• |
In addition, Mike Durham, former CFO of American Airlines and Fortune 500 executive, has joined the Board of Directors and will focus on financial management and capital allocation |
17
Financial Management and Control
|
|
• |
New BOD Finance Committee |
|
|
• |
Improved Planning and Capital Allocation process |
|
|
• |
Process Ownership by CFO |
|
|
• |
Continuing Improvement in Financial Statement Transparency |
|
|
• |
Optimized Capital Structure |
|
|
• |
Metrics to Track Performance |
|
Strategic
|
Performance Management
|
Tactical
|
|
Forecasting
|
Budgeting
|
18
Acxiom Has Not Ignored ValueAct
|
|
• |
Adopted suggestion of Financial Road Map |
|
|
• |
Bolstered financial acumen for Board of Directors and management team |
|
|
• |
Listened and discussed ValueAct’s proposals at Board meetings |
|
|
• |
On multiple occasions, has invited ValueAct to present their ideas to Acxiom Board |
|
|
• |
Provided ValueAct access to Acxiom leadership |
19
Acxiom Has an Independent Board of Directors
|
|
• |
Acxiom’s Board of Directors meets all independence requirements |
|
|
• |
Two non-independent directors have resigned from the Board in the last 18 months |
|
|
• |
A new independent director has recently joined the Board, and brings substantial financial expertise |
|
|
• |
Created the role of Lead Independent Director and Vice-Chairman, Bill Dillard |
|
|
• |
Our nine-member Board has two management directors and one member who is non-independent solely due to a contract that ends in 2007 and provides him no financial benefit |
20
Why Charles Morgan Should Be Chairman
|
Acxiom’s shareholder value will suffer without his board leadership |
|
Strategic Vision and Technology Development
|
• Understands how innovation creates competitive advantage • Has driven development and deployment of breakthrough products and technologies
|
|
Deep Relationships With Key Clients
|
• Relationship owner for many top clients • Personal long-term relationships built on trust & commitment • Clear short- and long-term risk if Charles is not chairman
|
|
Highest-Level Industry Relationships
|
• Recognized as thought leader in direct marketing industry • C-level relationships with many large technology companies • Initiated and maintains critical partnerships
|
|
Attracting and Retaining Talented Management Team
|
• Has attracted world-class additions to senior leadership team • Has nurtured and mentored strong internal leaders • Engenders strong loyalty among leaders, associates at Acxiom
|
|
Charles Morgan Is Clearly at the Foundation of Acxiom’s Success – Past Present and Future | |
21
Why Other Nominees
|
|
• |
Ann Die Hasselmo – Independent Director |
|
|
• |
Clearly Independent – no business ties to the Company |
|
|
• |
Managing Director of Academic Search Consultation Services |
|
|
• |
Active leader in higher education at a national level |
|
|
• |
Past chairman of the board of National Association of Independent Colleges and Universities |
|
|
• |
William Henderson – Independent Director |
|
|
• |
Clearly Independent – no business ties to the Company |
|
|
• |
COO of Netflix, on-line DVD rental company with 4.2 million members |
|
|
• |
Former CEO and Postmaster General for US Postal Service – with more than 1 million employees and a $90 billion operating budget |
|
|
• |
Insight into mailing industry, a critical marketing channel for many of Acxiom’s clients |
|
|
• |
Significant experience in deployment of technology in a large-scale environment |
|
|
• |
Network of global relationships in industry and governments |
22
Why Not ValueAct
|
The issue is more than just board seats |
|
|
• |
Acxiom slate is comprised of the Company Leader and two independent directors who have no conflicts of interest |
|
|
• |
ValueAct has made an offer to buy the Company – we believe this makes the nominees unable to act as fiduciaries to other shareholders |
|
|
• |
Mr. Ubben also serves as a Board member of a direct competitor of Acxiom and ValueAct holds substantial ownership in that Company |
|
|
• |
These interests directly conflict with the interests of all other shareholders |
|
|
• |
We believe the strategic plan of Acxiom management will create more shareholder value than ValueAct’s short term objectives |
|
|
• |
ValueAct’s plan is uninformed and irresponsible, thus creating both near-term and long-term risk |
23
Why Not ValueAct (cont)
|
|
• |
ValueAct’s nominees do not instill confidence |
|
|
• |
For example, in the 11 months Mr. Lawrie was the CEO of Siebel, 18% of shareholder value was destroyed (approximately $860 million), and at the same time he accepted approximately $10 million for his stark lack of performance |
|
|
AND |
|
|
• |
While he praised a new CalPERS-instigated compensation plan at Siebel that tied options and bonuses to financial performance criteria (“I want to be known as a company that rewards and is managed by shareholders”), Mr. Lawrie never renegotiated his own compensation plan in the spirit of what he was having others do |
24
Summary
|
|
• |
Acxiom will continue to deliver superior shareholder returns with execution of its current plan through a combination of: |
|
|
• |
Charles Morgan and current board leadership |
|
|
• |
Monetizing key investments |
|
|
• |
Sustained loyalty of clients and the management team |
|
|
• |
Acxiom has responded to ValueAct’s concerns about financial management and board structure |
|
|
• |
Introducing ValueAct into the Acxiom board will create both near-term and long-term risk |
|
We ask for your support for the Company’s director nominees in the upcoming shareholder vote |
25