Advo Acquisition Boosts Valassis’s Revenue as Net Income Falls
Valassis generated $612.1 million during its second quarter, well over the $260.6 million it realized in second quarter 2006. But a healthy chunk of that gain was due to its acquisition of Advo Inc., which was competed on March 2. The combined company’s net earnings fell from $19.7 million to $9.8 million. The quarter ended June 30.
The falloff in net income reflects increases in selling, administrative and general expenses, as well as interest expenses and amortization costs that outstripped the combined companies’ revenue gains.
The company’s top-line revenue has also been hurt by circulation reductions and outright eliminations in a number of markets for its shared mail programs.
Valassis has trimmed its full-year revenue predictions. It now anticipates revenue of between $2.22 billion and $2.25 billion, down from earlier anticipations of between $2.25 billion and $2.35 billion.
