Valassis Earnings Slip

Revenue is $248 million for the first quarter.
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Marketing services provider

Valassis

(VCI)

said first-quarter earnings fell 36%.

The company earned $18.1 million, or 38 cents a share, in the quarter, compared with $28.2 million, or 55 cents a share, a year ago. Analysts polled by Thomson First Call were expecting earnings of 41 cents a share in the most recent quarter.

First quarter revenue decreased 11.3% to $247.6 million as against analysts' expectation of $273.6 million revenue.

The Livonia, Mich.-based company expects to earn 49 cents a share to 55 cents a share in second quarter and $1.95 a share to $2.15 a share for the full year while analysts estimate 52 cents a share for the second quarter and $2.04 a share for the full year.

Operating profit fell 35.3% to $29.5 million while operating profit margin declined 440 basis points to 11.9%.

"Despite the difficult quarter for the promotional media industry, we met the low end of the published EPS guidance range. These advances made during the quarter will positively affect the rest of the year, particularly the second half," the company said. Valassis said that market delivered free-standing insert revenues declined 12.5% to $115.3 million due to a mid- to high-single digit reduction in FSI pricing and a decline in industry volume compared to the first quarter of the previous year.

The company has begun market evaluation efforts in China, including opening of an office in Shanghai.

Valassis fell 34 cents to $28.79.

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