Daily Research News Online no. 6401 - Reagan's Pollster Hangs Up His Spurs

Reagan's Pollster Hangs Up His Spurs

February 2 2007

Harris Interactive has announced the retirement of Dr. Richard B. Wirthlin, Reagan campaign strategist and founder of Wirthlin Worldwide, which Harris acquired in 2004. Harris also announced quarterly results showing strong growth in European business balancing a dip in US revenues.

Dr Wirthlin's retirement after nearly two and a half years on the Harris Board is long-planned � he comments: 'I believe that my efforts to help maximize the combined value of these two great companies have now been successfully concluded and I leave them in some very capable hands'.

Best known as the strategist and pollster to late President Ronald Reagan, Dr. Wirthlin planned both the 1980 and 1984 election campaigns, polling and briefing the President and Cabinet officers on American attitudes to the issues of the day during regular White House strategy sessions. A friend of Reagan's for 36 years, in 2004 he co-authored, with Wynton Hall, the critically acclaimed book The Greatest Communicator: What Ronald Reagan Taught me about Politics, Leadership, and Life. With his retirement, he intends among other interests to spend more time writing.

He founded Wirthlin Worldwide as long ago as 1969 and led its growth into a major international agency. The company won the Advertising Research Foundation's David Ogilvy Research Award four times, and received the overall federation's 'Grand Winner' trophy in 1999 and 2002. When Harris acquired the firm in September 2004 (www.mrweb.com/drno/news3388.htm ) it added $50 million in annual revenue and 300 new clients to the fast-growing online specialist.

Dr Wirthlin is a previous 'Pollster of the Year' for the American Association of Political Consultants and was designated as the 'Ad Man of the Year' by Advertising Age in 1981, for his role in the Reagan campaign. A former economics and statistics professor, he received a PhD from the University of California at Berkeley.

Dee Allsop, Former CEO of Wirthlin Worldwide and President of the Solutions Research Group at Harris Interactive, says: 'Dr. Wirthlin has been a mentor to me throughout my career and has earned the reputation as one of the most respected strategists in the world. He has been an exemplary colleague and we are grateful to have had his wise counsel and wide range of experience throughout the years.' Harris CEO Greg Novak described Dr. Wirthlin as 'truly one of the legends of market research', adding, 'His legacy here and in this industry will long be remembered. All of us at Harris Interactive thank him for his commitment and for his many contributions, and we wish him the very best.'

The results published today show Harris Interactive sales bookings up 12% to $66.5 million in the firm's Fiscal Second Quarter 2007, which ended on December 31st 2006. European revenue for the quarter grew 20% and generated a record profit. Gross margin rose to 51.7% and operating income was up 46%, mostly but not entirely due to a UK real estate sale. The company now expects $117�122m revenue and $0.11-$0.13 EPS (earnings per share) in the second half of the financial year.

According to a cautious Novak, 'the investments we have made to drive sales began to pay off this quarter... However, I do want to emphasize that the sales-to-revenue conversion rate has slowed as our deep account penetration strategy has generated more wins of long-term tracking and large, multinational research contracts.'

The results show a mixed bag with overall Q2 revenue up 3% on the year to $56.6m and European revenue up 20% to $13.4m, including $1.3m of favorable foreign exchange rate differences; but with US revenue down 1% to $43.2m. Global revenue from Internet research was $32.4m, the same as a year previously, masking a big regional difference: US second quarter Internet revenue was $28.4m, down 3% on the year, while European Internet revenue rose 27% to $4.0m.

Novak says he expects to see revenue growth improving in the second half of the fiscal year as the increased sales bookings begin to convert. The firm's balance sheet remains strong and it is essentially debt-free. An extension of the current stock buy-back plan was announced, increasing the existing share repurchase plan by $30m.

Detail is available via the investor relations section of the company's web site at www.harrisinteractive.com/ir .