Big Flower Acquires Reach America; Sales up for 1Q

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Advertising and marketing services company Big Flower Holdings, New York, announced that it has purchased Reach America, New York. Big Flower focuses on targeted advertising inserts, customized direct mail and digital services, and Reach America develops targeted audience databases, tracks consumer products' category sales potential and maps retail trade zones.

Big Flower's advertising insert producer, TC Advertising, worked with Reach America in 1995 to develop the Target Reach database information system that lets advertisers customize their insert advertising to match the demographic characteristics of more than 20,000 newspaper delivery zones in the country's top 300 markets.

Big Flower says that Target Reach, which was launched in 1997, has been well received in the software and automotive industries. Reach America also has developed database and search engines used by national advertisers for insert media buys, and it is developing a geodemographic software package customized to particular retail-chain segments, such as grocery or drug stores.

"By adding Reach America to our software development group, we can unlock new advertising applications for all of Big Flower's customers," said Edward T. Reilly, Big Flower's president and CEO.

In other news, Big Flower reported that net sales for the first quarter ended March 31 increased 29 percent to $383.9 million, from $297.5 a year ago. Operating income was up 25.3 percent to $19.5 million, from $15.6 million a year ago. Net income decreased to $1.1 million, from $1.7 million a year ago.

Sales from Big Flower's direct marketing services segment rose to $62.8 million, a 42 percent increase over the same period last year. Operating income was $6.1 million, a gain of 29 percent. The company attributed the growth to new products developed in the direct mail business for the publishing, utilities and telecommunications businesses; increased business from new and existing customers; and the acquisitions of UK-based Olwen Direct Mail and New York-based IMPCO.
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