ACNielsen U.S., Schaumburg, Ill., has donated Homescan consumer panel tools and information valued at nearly $500,000 to the Center for Retailing Excellence, which is part of the Sam M. Walton College of Business at the University of Arkansas.
NetRatings, Inc., Milpitas, Calif. and New York-based Jupiter Media Metrix, Inc. have mutually agreed to terminate their October 25, 2001 acquisition agreement and related loan and security agreement. The companies’ actions come after extensive discussions with the staff of the Federal Trade Commission (FTC). The FTC staff has indicated that it would strongly recommend that the FTC challenge the loan and security agreement that the companies entered into in conjunction with the acquisition agreement. The FTC staff also rejected alternative loan structures proposed by the companies. Additionally, the FTC staff has indicated that it would recommend that the FTC challenge the acquisition and seek a preliminary injunction enjoining consummation of the acquisition. Both David Toth, CEO of NetRatings, and Robert Becket, CEO of Jupiter Media Metrix, disagreed with the FTC staff’s conclusions regarding the loan and security agreement as well as the competitive impact of the acquisition. Becker said that without the benefit of the loan agreement, Jupiter Media Metrix was not in a position to contest the FTC in a lengthy court challenge. The decision to mutually terminate the acquisition agreement does not require either company to pay a breakup fee. and each company will bear its own acquisition-related expenses.
In connection with the announcement of its proposed acquisition of Jupiter Media Metrix, NetRatings also announced that it had agreed to purchase the interests of ACNielsen eRatings.com that it does not currently own. The eRatings transaction is subject to customary closing conditions as well as completion of the Jupiter Media Metrix acquisition. At press time, the parties to the eRatings transaction had not determined if that transaction would proceed.
Jupiter will form a special committee of the board of directors to explore strategic options to strengthen its position in the marketplace. The company has retained Robertson Stephens, Inc. to act as an advisor in this process. The firm will continue pursuing its patent infringement lawsuit against NetRatings. An October 28, 2002 trial date has been set.
NetRatings has announced a number of initiatives to streamline its business and focus on core product areas, including the discontinuation of two products and a reduction in staff. The streamlining initiative will eliminate 20 positions, or about 15 percent of the company’s employee base. Two products, AdSpectrum and eCommercePulse, will be discontinued. The company anticipates annualized cost savings of between $6 million and $8 million as a result of these changes and expects to incur a onetime charge of between $6 and $8 million in the first quarter of 2002 to cover reorganization and workforce reduction costs.
Atlanta mystery shopping firm Shop’n Chek Worldwide has expanded its licensee coverage to include Southeast Asia and Europe. The expansion took place effective January 24 with the execution of a licensing agreement with an existing Shop’n Chek Worldwide licensee presently covering Australia, New Zealand, and the U.K. With this expanded coverage, 12 licensees in more than 63 countries and territories now perform Shop’n Chek Worldwide’s services.
Acquisitions
Access Data Corp., a Pittsburgh marketing firm serving the financial services industry, has acquired the financial services practice of Boston-based Atlantic Research and Consulting. The companies have also formed a strategic alliance in which Atlantic Research will provide Access Data with field and tabulation services in support of the firm’s strategy practice. The financial services consulting arm of Atlantic Research provides field research and tabulation services in syndicated and custom research to financial services industry clients.
Germany-based GfK has increased its stake in the French Institut de Sondage Lavialle (I.S.L.) via its subsidiary GfK Sofema International from 50.01 to 71.9 percent. With 79 full-time employees, I.S.L. generated total revenue of approximately 16 million euros for 2001. The company carries out an omnibus survey in France and has had an access panel since 1999. It also measures TV ratings on behalf of Médiamétrie and carries out magazine reach surveys for France, together with two other companies.
GfK has also increased its holding in its Turkish subsidiary, Procon GfK, which is based in Istanbul, from 50.1 to 70.1 percent. With around 68 employees, the company achieved total revenue of just under 2.7 million euros in 2001 in the GfK business divisions of Ad Hoc Research and Non-Food Tracking.
Also, via its Austrian subsidiary, Fessel-GfK, the GfK Group has expanded its business in Central and Eastern Europe to include the Federal Republic of Yugoslavia. The newly established GfK Belgrade has started up its activities in the Federal Republic of Yugoslavia and has taken over the business of Fokus Marketing Research, the third-largest market research organization in the Federal Republic of Yugoslavia at the time.
The GfK Group has also acquired major segments of PMSI, a U.K. company owned by HMS Health which specializes in health care research. The services taken over by GfK include using tracking instruments to measure the impact of communications on general practitioners and hospital doctors, and PMSI’s omnibus survey instrument, Generator, for ad hoc surveys of doctors.
GfK also acquired the business division of IMS Health in the U.K. and Ireland which focuses on providing services to the veterinary industry. The core feature of this division is a retail panel which records veterinary products bought by vets in the U.K. and Ireland.
In organizational terms, these two acquisitions form part of GfK’s majority shareholding in Martin Hamblin GfK, which was acquired in 2001. This trades under the name Martin Hamblin GfK Health Care Ltd. and has a target total revenue of 4 million euros for 2002.
Aegis Group plc, the media communications and market research group, has acquired Market&More, a full-service research company with operations in Germany, the Netherlands, Belgium, and France. The initial consideration of 6.0 million euros is payable in cash on completion; there is also deferred cash consideration, subject to performance criteria, payable over the next three years. Market&More had revenues of approximately 13.5 million euros during the year ended December 31, 2001.
Separately, Aegis has also acquired an effective 25 percent interest in The Filter Group, a marketing consultancy company with offices in Singapore, Hong Kong, and Bangkok. The initial consideration comprises £0.3m cash payable on completion. Additional consideration may include an issue of 109,178 Aegis shares in January 2005. In addition, there are put and call options over the remaining 75 percent exercisable in 2005 payable in cash based on performance criteria.
U.K.-based Business & Market Research (B&MR) has become a member of Wirthlin Worldwide, a strategic research and consulting firm. The addition of B&MR’s 120 employees makes this the largest acquisition in Wirthlin’s history. Andrew Vincent has been named managing director of Wirthlin-Europe, Ltd. B&MR will merge with Wirthlin’s existing operations in London and Brussels. Initially, the U.K. operation will be known as B&MR, a member of Wirthlin-Europe, Ltd., and after a transition period it will assume the name Wirthlin-Europe, Ltd.
Call_Solutions.com, Inc., a Waukesha, Wis. CRM firm, has acquired Service Strategies International, Inc., a Dallas marketing research company. Pam Borders, who founded SSI in 1988, continues as CEO.
Alliances/strategic partnerships
As part of a strategic alliance with Illumitek, Inc., a Herndon, Va., software firm, Chicago-based Research International has deployed illumitek’s nVIZn business intelligence product in Research International’s marketing information distribution system, Torii, to deliver enterprise-wide marketing intelligence applications to their customers.
Cincinnati-based Burke Institute and Burke, Inc. have entered into a joint venture to combine the ACNielsen Burke Institute and Burke’s The Training & Development named The Burke Institute. This joint venture will bring together the faculty and course content from both organizations. The Burke Institute will be based in Cincinnati.
SPSS MR, Chicago, has signed a deal with Cincinnati-based Language Logic to become an official distributor of Ascribe, Language Logic’s online coding system. Customers access Ascribe via their Web browsers and can code responses from any type of survey.
The Penton Electronics Group, Hasbrouck Heights, N.J., has signed an agreement with Merrill Research & Associates to provide a range of qualitative and quantitative research services for technology marketers in the electronics OEM. The parties said they plan to co-brand two major syndicated research projects in 2002, and will work jointly on several vendor-sponsored projects throughout the year.
Spatial Insights, Inc., a Vienna, Va., GIS firm, has formed a strategic alliance with Mapping Solutions, LLC under which East Lansing, Mich.-based Mapping Solutions will act as a value-added reseller for Spatial Insights.
Awards
Survey Service, Inc., Buffalo, N.Y., presented its first annual Beatrice J. Gorbaty Award of Excellence to Shirley Brodsky Adler, a Survey Service senior project manager. The award was created to honor Survey Service Founder Beatrice J. Gorbaty and to recognize an individual who exemplifies her standards, values, and leadership qualities.
New accounts/projects
ACNielsen U.S., Schaumburg, Ill., has become Winn-Dixie’s preferred provider of syndicated sales information and consumer insights. Under the agreement, Winn-Dixie also becomes a user of Category Business Planner, ACNielsen’s category management intelligence system, and the ACNielsen Homescan consumer panel suite of syndicated applications.
Chicago-based Information Resources, Inc. (IRI) has reached an agreement with PepsiCo to fold in the Quaker Oats Company to the existing contract which includes Pepsi-Cola, Tropicana Products, and Frito-Lay. IRI will continue to be the company’s primary provider of UPC scanner-based information and consumer insights through December 2005.
New companies/new locations
Target Market Research Group, Miami, has changed its name to Eneuesta, Inc.
Japan-based Video Research Ltd., has opened a new company, Video Research International (Thailand) Ltd., in Bangkok. The new company will offer a range of marketing information services in Thailand and will bid for the national television audience measurement service contract.
Former HMR and Associates employee Vicki Phillips has taken over the HMR and Associates focus group facility at 2904-A Tazewell Pike, Suite A, Knoxville, Tenn., 37918. The facility includes a viewing room accommodating up to 14 clients, a conference room seating up to 15 respondents, and a kitchen for food testing.
Company earnings report
New York-based Jupiter Media Metrix, Inc. announced results for the fourth quarter and year ended December 31, 2001. Revenues for the fourth quarter were $14.5 million, compared to $38.5 million for the fourth quarter in 2000. Revenues for the year ended December 31, 2001 were $89.2 million, compared to pro forma revenues of $142.8 million in 2000. Contract value, defined as the annualized value of all subscriptions at the end of each period, was $54.1 million on December 31,2001 compared to $120.5 million on December 31, 2000.
Net loss for the fourth quarter of 2001, excluding amortization, was $10.4 million or ($0.29) per share, compared with a net Joss of $8.2 million or ($0.23) per share for the same period in 2000. Net loss for the year ended December 31, 2001, excluding amortization and other one-time cash and non-cash charges recorded during the year, was $44.6 million or ($1.26) net loss of $9.8 million or ($0.28) per share in 2000.
Net loss for the fourth quarter, including amortization, was $20.7 million or ($0.58) per share, compared to a loss of $37.4 million or ($1.07) per share for the fourth quarter in 2000. Net loss for the full year, including amortization and other one-time cash and non-cash charges recorded during 2001, was $519.2 million or ($14.62) per share, compared to a pro forma loss of $124.4 million or ($3.57) per share in 2000.
Ipsos reported consolidated revenues of 480.1 million euros for the year ended December 31, 2001. Revenues are up 46 percent over 2000 (329.5 million euros). For the fourth quarter 2001, revenues rose to 147.2 million euros, up 31 percent from the fourth quarter 2000 (112.6 million euros). Ipsos growth for the last quarter reached 7.7 percent over 4Q 2000.
Opinion Research Corporation, Princeton, N.J., reported results for the fourth quarter and the year ended December 31, 2001. For the year, revenues were a record $177 million, an increase of 10 percent compared to 2000 revenues of $161 million. Operating income for 2001 totaled $8.8 million compared to $11.6 million in 2000. Net income for the year was $1.6 million and earnings per share were $0.27 compared to $3.3 million and $0.65, respectively, in 2000.
For the year 2001, the company generated EBITDA (earnings before interest, taxes, depreciation, and amortization) of $17.3 million compared to $18.9 million in 2000. Cash earnings per share for the year were $0.71, compared to $1.06 last year. Cash earnings per share (earnings per share plus the per share amount of after-tax good will amortization) are consistent with what will be reported as earnings per share in 2002 under FASB Statement 142.
For the fourth quarter of 2001, revenues were $44 million, compared to $43.7 million in the fourth quarter of 2000. Operating income for the quarter was $1.8 million, compared to $3.2 million in the fourth quarter of 2000. Net income for the fourth quarter was $188,000 and earnings per share were $0.03, compared to $909,000 and $0.16, respectively, in the fourth quarter of 2000. For the fourth quarter, EBITDA was $4.0 million, compared to fourth quarter 2000 EBITDA of $5.2 million. Cash earnings per share for the fourth quarter were $0.15 compared to $0.26 in last year’s fourth quarter.
Fairfield, Conn.-based IMS Health announced full-year 2001 diluted eamings per share of $0.90 from recurring operations, a 6 percent increase over 2000 results. Net income from recurring operations grew 7 percent year over year, to $270.6 million. For the fourth quarter, the company reported diluted earnings of $0.22 per share, 15 percent below the year-earlier period, and net income of $66.8 million from recurring operations, down 14 percent year over year.
Recurring results exclude a previously announced pre-tax charge of $94.6 million reflecting costs to streamline operations, increase productivity, and improve client service. Recurring results also exclude divestitures and other one-time gains and charges, including a $24.6 million fourth-quarter write-down of the Enterprises venture capital portfolio; and $6.5 million of terminated transaction costs.
During the 2001 fourth quarter, revenue totaled $340.9 million, up 1 percent constant dollar year over year and 2 percent on a reported basis. Operating income was $98.1 million, down 17 percent constant dollar and 23 percent on a reported basis from the year-earlier quarter. Net income declined 14 percent to $66.8 million, or $0.22 per share, in the 2001 fourth quarter.
IMS Health’s full-year 2001 revenue rose to $1,332.9 million, up 11 percent constant dollar and 6 percent on a reported basis. This compares with revenue of $1,254.0 million in 2000. Operating income for 2001 grew 14 percent constant dollar, or 6 percent on a reported basis, to $427.6 million. Net income rose 7 percent in 2001 to $270.6 million, or $0.90 per share, compared with $253.6 million, or $0.85 per share, in 2000.
Preliminary figures indicate that GfK, Nuremberg, Germany, saw total revenue rise to 534.0 million euros and consequently exceeded the figure for the previous year of 480.9 million euros by 11 percent. Earnings before interest and tax including income from participations (aEBIT), increased by 14.5 percent to 45.1 million euros. Consequently, aEBIT grew more rapidly than total revenue, with the aEBIT margin rising from 8.4 to 8.6 percent.
Net income for financial year 2001 was affected by non-recurring charges totalling 10.5 million euros, which were reported by GfK in the last quarterly accounts. The charges comprised the costs of changes in the field research team at GfK Data Services and migrating the finance and personnel management to SAP R/3, amounting to 3.5 million euros.
A figure of 7 million euros also related to the depreciation conceming the participation in Jupiter Media Metrix (JMXI) in the USA. The write down became necessary because of the takeover offer by VNU subsidiary Netratings for JMXI. Given the prohibition by the FTC, the parties involved in the takeover agreed not to pursue this any further. Since the write-down on JMXI is not tax deductible, GfK is expecting a taxation ratio of some 45 percent.
SPSS Inc., Chicago, announced results for the fourth quarter and fiscal year ended December 31,2001. On a pro forma basis, excluding acquisition-related and other non-recurring charges, but including, for both years, the full implementation of prior year accounting interpretations on revenue recognition, diluted eamings per share and revenues for the quarter ended December 31, 2001 were $0.25 and $48.2 million, respectively. These results compare to analyst expectations of earnings of between $0.35 and $0.40 and revenues of between $48.0 and $50.0 million, as well as to pro forma earnings per share and revenue figures for the same period last year of $0.23 and $51.2 million, respectively.
On the same pro forma basis, diluted earnings per share and revenues for the fiscal year ended December 31, 2001 were $0.56 and $187.4 million, respectively, which compare to pro forma earnings per share and revenue figures in the previous year of $0.98 and $197.9 million, respectively.
On a reported basis, diluted loss per share and revenues for the quarter ended December 31, 2001 were ($0.73) and $48.2 million, respectively. These reported results include acquisition-related and other non-recurring charges as well as the effects of the prescribed implementation of the recent accounting interpretations. Such results for the fiscal year ended December 31, 2001 were ($1.52) and $176.6 million, respectively.
Chicago-based Information Resources, Inc. (IRI) reported improved results for the fourth quarter and year ending December 31, 2001. For the quarter ended December 31, 2001, the firm reported net income, before restructuring and other items, of $2.2 million or $.08 per share, an improvement of $1.9 million or $.07 per share from the fourth quarter of 2000. Including the impact of restructuring and other items of $3.0 million, IRI reported net income of $0.3 million or $.01 per share, an improvement of $2.7 million or $.09 per share from last year's fourth quarter. Fourth quarter 2001 restructuring and other items include a one-time gain of $2.0 million relating to the settlement of a legal dispute with Manugistics, Inc.
Revenues of $140.5 million were up 3 percent compared with last year. U.S. revenues were $105.0 million, an increase of 6 percent compared to the prior year. International revenues decreased 3 percent to $35.5 million due to reduced revenues in Germany. Operating income before restructuring and other items was $4.2 million, an increase of $3.7 million from last year.
For the full year 2001, IRI reported net income, before restructuring and other items, of $5.8 million or $0.20 per share, an improvement of $5.4 million or $0.18 per share from fiscal 2000. Including the impact of restructuring and other items of $15.4 million, IRI reported a net loss of $3.9 million or ($0.13) per share, an improvement of $3.6 million or $0.13 per share from last year.
Revenues of $555.9 million were 5 percent above last year. Revenues from the company's U.S. business increased 6 percent for the year compared to 2000 while international revenues were up 2 percent over 2000, a 6 percent increase in local currencies. Operating income before restructuring and other items was $ 13.2 million, or $9.7 million higher than prior year. The increase was primarily due to higher profitability from the company's U.S. business.