Daily Research News Online no. 12584 - Harris' Fall in Q1 Revenue Driven by Contract Losses

Harris' Fall in Q1 Revenue Driven by Contract Losses

October 29 2010

In the US, Harris Interactive has reported a 5% decline in revenue for its first quarter, partly driven by lost tracking study contracts, the deferral of a large tracking study in the UK, and revenue declines in the US public affairs and policy, and healthcare sectors.

Kimberly Till Revenue for the first three months ended September 30 were $37m in 2010, compared with $38.9m in the prior year period.

US revenue was down 4% driven mainly by a 19% decline in the firm's public affairs and policy sector due to lower spending by association, non-profit and government clients, and a 9% decline in the healthcare sector.

In the UK, revenue was down 15% as a result of the delay of a large tracking study that was delivered in last year's Q1. However, President and CEO Kimberly Till said that the client is 'doubling up' on the tracking in Q2, so this increase will appear in Q2 figures.

French and German revenue were up 6% and 21%, Canadian revenue was down 1%, and Asia revenue was up 13%.

Group operating loss for the first quarter of fiscal 2011 was $1.3m, compared with $0.4m in the same period last year, while net loss for Q1 2011 was $1.3m, compared with a net loss of $0.6m in the same prior year period.

On a brighter note, bookings for the first quarter of fiscal 2011 were $35.4m, as compared with $32.7m for the same prior year period. Till explained that these increased bookings will convert to revenue in the coming quarters, and start to build a base from which the firm can achieve revenue growth for the full fiscal year.

'On a country by country basis, the US is gaining traction and France, Germany, and Asia are all performing well. This leaves Canada and the UK, where we have a strong sense of urgency to complete the turnaround of those businesses,' stated Till.

The firm has already changed the leadership in Canada, and now plans to focus on growing its online data collection capabilities in the region. Additionally, Till said that Harris Interactive has implemented a series of initiatives in the UK to improve financial performance.

In the past year, Till has implemented phase one of the firm's roadmap to turn around all parts of the business. Phase two of the roadmap calls for the firm to 're-establish a leadership position' in the market research industry through product innovation and 'economies of scale'.

'Looking ahead, I believe that we are well positioned to achieve revenue growth and profit growth for the full fiscal year, as the progress we've made in executing the key initiatives within the phases of our roadmap should translate into improved financial performance,' claimed Till. 'However, we do recognize that there is more work to do to ensure that that revenue growth and profitability growth is realized.'

Web site: www.harrisinteractive.com .