Harte-Hanks reports Q2 net income increase, revenue drop

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Direct marketing services company Harte-Hanks reported a 2.7% year-over-year net income increase to $13.4 million in the second quarter of 2010. However, the company's operating revenues dropped 3.7% year over year to $207.6 million.

“I'm pleased with our second-quarter performance, although revenues were still down,” said Larry Franklin, chairman, president and CEO of Harte-Hanks, during an earnings call.

“The 3.7% decrease is the lowest rate of decline since the fourth quarter of 2007,” he said. “While we continue to closely manage our expenses, we're making investments in our two businesses that we believe have terrific long-term returns.”

The service provider manages database and marketing analytics and multichannel marketing programs. It also operates Harte-Hanks Shoppers, a business unit that owns and manages online shopping destinations, including PennySaverUSA.com and TheFlyer.com, and print publications distributed in California and Florida.

Franklin said its digital strategy contributed to net income growth in Q2. “This included account growth, increased penetration of our print advertisers with power sites, increased revenue with products and features services,” said Franklin.

The company will continue to invest and add service in this area, he said, noting that “delivering customer insight” into every client program will be normal operating procedure going forward.

Harte-Hanks reported an 8% year-over-year revenue decrease to $200.2 million in the first quarter of this year. Net income was up more than 50% year over year to $10.8 million from Q1 2009.

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