Acxiom Finds Itself in Period of Uncertainty

by Mark Friedman  on Monday, Jan. 7, 2008 12:00 am  

While Morgan still is acting as company leader, in November he received a $3 million buyout and was replaced as chairman by Michael J. Durham, a former CEO of Sabre Inc. and a member of Acxiom's board since 2006.

Morgan said he will remain as interim company leader until a replacement can be found because the company doesn't need to be in limbo as it was while waiting to transform from a public company to a private one.

He said the board and management are heavily involved in trying to find a successor.

"We need to get out of this period of uncertainty, and now we can't fix the subprime crises but at least we can get a leader," he said in late December. Morgan didn't have a timeline for when the new CEO will be in place but said it could take as much as six months.

"The board is working hard to try and get someone identified, and that process is very active right now," Morgan said. "We've had good results from our recruiting process, and we have a number of very promising active candidates."

The new CEO will have to deal with a company that has seen its stock price tumble from $27.96 on May 30 to under $12 last week, despite a corporate buy-back of more than $40 million worth of stock.

And a recovery doesn't appear to be on the horizon for Acxiom anytime soon.

Moody's Investors Service in December gave Acxiom a negative rating outlook because of the hurdles it faces trying to regain revenue growth and profitability. Acxiom also is dealing with the decline in the financial services market, which makes up about 25 percent of the company's customer base.

The company's earnings had not been stellar either.

In the second quarter, which ended Sept. 30, Acxiom reported a 51.5 percent drop in income to $10.5 million compared with the same quarter in 2006.

Acxiom also announced it would lay off more than 250 people in a work force of about 7,100 employees because of the poor quarters, but Durham and Morgan have indicated that no new decisions on staffing levels will be made until the new CEO has time to evaluate the company.

That $3 Billion Deal

 

 

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