Harte-Hanks DM revenue grows in Q1, but overall earnings flat

Harte-Hanks' first-quarter direct marketing revenue increased 4.9% to $141.1 million, compared with Q1 2010, while direct marketing operating income declined 5.2% year-over-year to $16 million. The San Antonio, Texas-based company reported flat overall revenue in the quarter, growing 0.1% to $200.3 million compared with Q1 2010, on April 28.

“Direct marketing had good revenue growth,” said Larry Franklin, chairman, president and CEO of Harte-Hanks. “This was its third consecutive quarter of growth.”

Harte-Hanks' overall operating income decreased 21.8% to $14.3 million in Q1 2011, compared with the first quarter of 2010. Net income also decreased in the quarter, falling 26.5% to $7.9 million year-over-year.

“Q1 was challenging,” said Franklin. “Revenue was flat…We will continue to invest in our multichannel strategy, with several initiatives underway to reduce costs by changing the way we do business.”

Franklin praised data quality solutions business Trillium Software and CRM firm The Agency Inside Harte-Hanks for strong Q1 performances.

The company's retail and technology businesses each brought in the highest percentage of Q1 2011 direct marketing revenue at 25%, respectively. Financial and insurance services earned 15% of Q1 direct marketing revenue, healthcare and pharmaceuticals represented 10%, and other select markets represented 25%.

“Our direct marketing has accomplished a lot,” said Franklin, “and the good thing is there is a lot more to be done and there are a lot more opportunities out there.”

In February, Harte-Hanks reported that fourth-quarter 2010 direct marketing revenue increased 14.2% compared with the same period of 2009.