Harte-Hanks, Inc. (NYSE: HHS) reported second quarter 2013 diluted earnings per share from continuing operations of $0.13 on revenues of $188.3 million (versus $189,6 of prior year period).

Total revenues decreased 0.7% driven by a decrease in Direct Marketing revenues of 1.9%, partially offset by an increase in Shoppers revenues of 2.8%.  Direct Marketing results reflect the impact of our financial vertical and retail vertical increasing 4% and 2%, respectively. The automotive and consumer brands vertical experienced a 2% revenue decline, and our high-tech vertical was flat.

Our select vertical decreased 17% compared to 2012 and our pharmaceutical vertical decreased 12% from the previously discussed loss of a long standing customer in the third quarter of 2012. Shoppers revenue performance reflects increased revenues from distribution products, partially offset by decreased in-book advertising.  From an industry perspective, Shoppers revenues increased from the consumer spending, automotive, health, restaurant and communications sectors, and decreased from the real estate and education sectors.

Operating income, excluding the previously discussed charges in 2013 and 2012, increased $0.6 million.  Direct Marketing operating income, excluding charges, increased 2.3% with increased operating margins and Shoppers operating income, excluding charges, increased $0.5 million with a $1.3 million revenue increase for the quarter.

Commenting on the second quarter performance, President and Chief Executive Officer Robert Philpott said, “We are encouraged by the overall improving marketing environment as evidenced by the growing confidence and optimism in the United States economy. The challenge remains in traditional marketing channels where industry forecasts are weak for the near future. Cost pressures and intense competition determine which marketer wins business. Omnichannel strategy is now common place amongst our clients, Harte-Hanks’ unique combination of skills in both digital and conventional marketing channels will serve us well.

“Our second quarter performance was an improvement in both revenues and operating income compared to the 2013 first quarter.

“Our business continues to be volatile, especially in the traditional services we provide. Retailers in particular are consistently requiring short-term flexibility in the nature and volume of their marketing campaigns. Therefore, for the remainder of year, we expect to see revenue trends consistent with those seen in the first half and with operating margins under short-term pressure.”

Source:  Yahoo Finance