Earnings up for Murphy Oil, down for Acxiom

Murphy Oil Corp., which is poised to spin off its retail and refinery operations, posted higher second quarter net income compared to one year ago.

The El Dorado-based oil and gas company recorded earnings of $402.6 million, or $2.12 per diluted share, compared to $295.4 million, or $1.52 per diluted share, one year ago.

Revenues climbed to $7.21 billion for the quarter, up from $7.15 billion in the previous year’s second quarter. A contributing factor to the boost in income was an after-tax gain of $71.9 million from the sale of the Mungo and Monan fields in the United Kingdom during the just completed quarter.

In spinning off its retail and refinery groups, Murphy Oil Corp. is preparing to split into two publicly traded companies. The current company will remain a pure-play oil and gas exploration and production firm. Murphy USA will become a standalone company holding retail assets across the south and midwest.

In the last quarter, the new board of directors for Murphy USA was announced.

“Murphy USA is in the process of finalizing its capital structure,” said Murphy Oil CEO Steve Cosse, who will be transitioning corporate leadership to CEO-elect Roger Jenkins. “We expect that the Murphy Oil Corporation Board of Directors will consider this progress at its meeting next Wednesday and we would expect to announce the board’s conclusion shortly thereafter.”

Andrew Clyde will lead Murphy USA.

Cosse also said Murphy Oil and Murphy USA will freeze providing earnings guidance due to the split in the company structure.

“Due to the transformation of Murphy Oil to a pure play E&P company with the anticipated spin-off of the U.S. retail business, we will no longer provide future quarterly earnings guidance in our earnings press release. Murphy Oil and Murphy USA are each considering the type of future quarterly guidance that will be provided going forward,” he said.

Shares of Murphy Oil (NYSE: MUR) closed trading Wednesday at $67.72. The company’s stock has traded between $50.03 and $68.76 during the past year.

ACXIOM 'BAD NEWS'
Acxiom Corp. saw revenues slide and earnings hold close to unchanged, as company leaders disclosed a string of lost business and efforts to turn around its “bad luck.”

The Little Rock-based data marketer and management company reported first quarter earnings of $13.18 million, or 17 cents per diluted share, compared to $13.33 million, or 17 cents per diluted share, one year ago.

Revenues dipped from $271.66 million in last year’s first quarter to $266.19 million in the most recent period.

Acxiom CEO Scott Howe started the company’s investor conference call with an ominous disclosure.

“I’m going to start today’s call with some bad news,” Howe said. “I want to talk about a setback we have had in the IT Infrastructure business. Over the past few months, we have experienced some significant customer losses. In our 10-K, we talked about termination notices and the associated customer revenues. Unfortunately, since our filing, we have been notified of an additional termination. The reasons for the overall losses differ. Two were basically bad luck, where customers decided to take their IT infrastructure in-house as part of being acquired by a third party.”

“The other 4 situations where we lost the competitive bids in our services were just not renewed. This is obviously not the result we worked for, nor is it acceptable,” Howe added.

He said the company would “redouble” its efforts to serve its ITO (Information Technology Outsourcer) customers.

Acxiom has three primary revenue streams: IT infrastructure management, marketing and data services, and other services.

The company’s IT segment posted quarterly revenue of $69.39 million, down from $70.29 million one year ago.

Marketing and data provided $187.79 million, down from $192.48 million last year.
Other services accounted for $9.02 million, up from $8.88 million a year ago.

Acxiom did score some new clients in its marketing and data services division during the quarter, and it said in September it was launching a new technology for data marketing and insights called Acxiom Audience Operating System.

“We believe our technology is groundbreaking and will re-define marketing,” said Howe. “For the first time marketers, agencies and publishers will have one to one marketing capabilities at scale across all channels and devices.”

Acxiom shares (NASDAQ: ACXM) closed trading at $25.77 on Wednesday. The company’s stock has traded between $15.72 and $26.47 per share during the past 52 weeks.