Bob CarriganDuring D&B’s first quarter earnings conference call D&B CEO Bob Carrigan reiterated his strategy for sustainable long term growth and he had some important first achievements to back up his plans.

In January D&B entered into a long term strategic agreement with FirstRain, the latter providing D&B with customer and market intelligence, which D&B delivers through its world class solutions.  Going far beyond traditional news feeds, FirstRain big data analytics on unstructured information, including social media conversations on Twitter and blogs, deliver highly relevant, real-time insights on companies, markets and competitors to sales and marketing teams.

In March D&B entered into an alliance with SugarCRM, the CRM market leader to provide Sugar’s customers with an intelligent CRM to grow their businesses through integrated access to prospect, customer, and opportunity information.  Customers gain access to D&B’s global data on more than 230 million businesses and 100 million contacts.

To top it off in April D&B made two acquisitions.  It acquired the social data matching business unit of Fliptop, a leader in software solutions that aggregates public web and social data.  The acquisition combines social data with D&B’s proprietary data and analytics to deliver results for a growing and global customer base.

Furthermore D&B acquired Indisee, an innovator in the cloud-based analytics and business intelligence (BI) space. Indicee provides Cloud based technology and has no products per which D&B would be selling.  The acquisition could therefore be classified as ‘acqui-hiring’, a current popular trend to acquire software engineers. In conjunction with the Indisee acquisition D&B announced the creation of a ‘Cloud Innovation Center’.  Indicee’s Vancouver-based employees will be integrated into the Cloud Innovation Center.  Bob Carrigan explained the strategic rational behind this acquisition:  “Indicee’s unique capabilities will allow us to jump-start the development of our cloud-based DNBi solution, and DNBi is just the first step. We are creating a cloud innovation center that will be led by Indicee founder, Mark Cunningham, to leverage our newly acquired expertise in cloud-based technology to deliver D&B’s content in new and modern ways. Mark and his team have extensive background in business intelligence development, including Crystal Reports. We’re excited to have their entrepreneurial spirit here at D&B.”

The new capabilities will help D&B customers to make sense of big data by bringing together their own data with D&B’s structured data and unstructured data from new sources creating insight that is exponentially richer and more valuable than the separate elements on their own.

Bob Carrigan spoke about how important alliances are to our growth.  He stated: “Through alliances, we are embedding our content directly in our alliance partners’ applications so customers can access it natively in their workflow tools. We want to add more alliance partners because they enable us to reach more users, and we take the product development off of our platforms and onto our alliance partners’ platforms, where they’ve already got best-in-class applications and a relationship with their customers.“  In using the alliance with Sugar as an example he stated: “Sugar offers D&B content native in their CRM solution. With over 1.5 million users, the alliance with Sugar opens up a new opportunity for us to reach more customers faster than we could on our own. Sugar also has a very big concentration of small businesses, and this alliance allows us to further penetrate that customer segment.”

D&B’s first quarter segment results were as follows:

  • North America: Core and total revenue were $279.0 million, down 1%, year over year, before the effect of foreign exchange (down 2% after the effect of foreign exchange).  Operating income was $78.0 million, down 9%, year over year.
  • Asia Pacific:  Core revenue was $41.7 million, up 11%, year over year, before the effect of foreign exchange (up 2% after the effect of foreign exchange).  Total revenue was $41.7 million, up 10%, year over year, before the effect of foreign exchange (up 1% after the effect of foreign exchange).  Operating income before non-core gains and charges was $6.2 million, compared to $2.5 million from the prior year similar period. On a GAAP basis, operating income was $6.2 million, compared to $2.4 million from the prior year similar period.
  • Europe & Other International MarketsCore revenue was $61.1 million, up 6%, year over year, before the effect of foreign exchange (up 9% after the effect of foreign exchange).  Total revenue was $61.2 million, up 5%, year over year, before the effect of foreign exchange (up 9% after the effect of foreign exchange).  Operating income was $16.7 million, up 19%, year over year.
  • Free Cash Flow for the first three months of 2014 was $148.5 million; Net cash provided by operating activities for the first three months of 2014 was $160.5 million.D&B Quarterly Summary Q1 2014

Bob Corrigan stated that first quarter results were in line with expectations and D&B is on track to deliver its full year guidance of revenue of flat to up 3%, a decline in operating income of 5% to 9%, an EPS decline of 1% to 5%, and free cash flow of $250 million to $280 million.

Source:  D&B Earnings Release and Earnings Call Transcript