Harte-Hanks Revenue, Income Fall
Harte-Hanks generated $1.08 billion in revenue during 2008, down from $1.16 billion in 2007. The company reported $64.1 million in net income, down from $73.7 million a year earlier. The year ended Dec. 31.
Within its operating units, Direct Marketing services generated $732.7 million, virtually unchanged from the $732.5 million it pulled in during 2007. But its operating income slipped from $108.8 million to $103.1 million.
Its Shopper publications operations pulled in $350.1 million, considerably less than the $430.4 million it earned in 2007. Operating income for this unit similarly fell, from $70.8 million to $25.9 million. The company has reduced the circulation of its shopper publications from just 12.9 million to 12.1 million, although it still serves the same five markets it did in 2007.
Total shopper circulation isn’t the only metric that’s dropped: In addition to cutting its distribution by 768,000 copies, the average page count fell from 41 to 38. The trim size remained identical to 2007’s level. And with shopper circulation concentrated in California and Florida, this unit’s fortunes may mirror those of the Sunshine and Golden states.
Harte-Hanks’ direct marketing operations accounted for 68% of its total revenue in 2008 – a bigger piece of a stagnant pie. In 2007, this sector made up 63% of the company’s revenue. Its 25 largest clients accounted for the same percentage of its direct marketing revenue – 41% — as they did in 2007, but as the total revenue shrunk, the share contributed by these largest clients grew, from 26% of all revenue to 28%.
The Bean-Counter’s Take: International operations made up 9.5% of total direct marketing revenue, up from 8.5% in 2007 – and given the stagnant total level of Direct Marketing services income, this may give an indication regarding direct marketing health beyond the U.S. The company’s overseas business is primarily focused on Europe, Asia and South America.
