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Legal Costs Contribute to infoGROUP Loss
In the US, data giant the infoGroup has recorded an operating loss of $1.7m in the third quarter, caused partly by legal expenses and severance costs associated with the sacking of former Chairman and CEO Vin Gupta.
The company reported approximately $17.3m in non-recurring charges, including the $10.2m severance payment to Gupta, who stepped down from his role following an investigation which found he had misspent millions of company dollars.
Associated legal costs included $9.7m for counsel to the Special Litigation Committee, and $4.1m for Gupta's counsel.
'Now that this chapter in our company's history is nearly to a close, we can concentrate our efforts on being transparent and communicating both internally and externally with our employees, clients and shareholders, accelerating our profitable organic growth and improving our financial foundation,' stated new CEO Bill Fairfield.
For the quarter, group revenue fell from $185.0m to $181.9m, while in the Data Group, revenue plunged to $74.4m from $92.7m last year.
However, revenue for the Market Research Group - which includes Opinion Research Corporation, Macro International and Guideline - rose 16% to $65.5m during the same period, while organic growth increased 5%.
infoGroup is currently rationalizing its business structure and improving infrastructure efficiencies in order to be more cost effective. 'While we can not predict the future in these uncertain times, we are cautiously optimistic about the near term,' concluded Fairfield.
Web sites: www.infogroup.com and www.opinionresearch.com .
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