infoGROUP Reports Third Quarter Results

infoGROUP (NASDAQ: IUSA), the leading provider of data driven and interactive resources for targeted sales, marketing and research solutions today reported preliminary unaudited financial results for the third quarter of 2009 ended on September 30, 2009.

”We are pleased to report sequential revenue growth in the third quarter compared to our second quarter,” said Bill Fairfield, infoGROUP’s Chief Executive Officer. "We have worked hard to generate profitable revenue growth during these tough economic times, reduce our debt quarter over quarter and reinvest in the business by building new products and services for the future. All these initiatives continue to help move the Company in the right direction.”

THIRD QUARTER RESULTS

GAAP Results

During the third quarter of 2009, infoGROUP delivered revenue of $125.0 million, compared to $145.0 million for the same period in 2008, representing a decline of $20.0 million or 14%. Excluding the effect of foreign exchange, the decline was $18.1 million or 12%. The revenue of $125.0 million exceeded the second quarter of 2009 by $3.4 million or an increase of 3%.

infoGROUP’s operating income for the third quarter of 2009 was $9.4 million, which included $9.3 million of restructuring, non-recurring and non-cash charges, compared to an operating loss of $12.4 million in the third quarter of 2008, which included $27.6 million of similar charges.

infoGROUP’s net income for the third quarter of 2009 was $4.8 million, or earnings per share of $0.08, compared to a net loss of $8.6 million, or a loss per share of $0.15 in 2008.

Non-GAAP Results

infoGROUP’s adjusted earnings per share for the third quarter of 2009, excluding the restructuring, non-recurring and non-cash charges, was $0.18, compared to $0.15 for the third quarter of 2008, an increase of $0.03.

In the third quarter of 2009, EBITDA was $16.9 million compared to a loss of $3.3 million in 2008. Adjusted EBITDA, which excludes certain restructuring, non-recurring and non-cash charges, was $26.2 million in 2009, compared to $24.3 million in 2008. As a result of the cost cutting initiatives that were started last year and continued through the third quarter, we were able to offset the revenue decline experienced in the quarter.

In total, the Company recorded $9.3 million in costs during the quarter for restructuring, non-recurring and non-cash charges. This included $2.0 million in legal and professional fees related to the SEC investigation, $4.0 million in restructuring costs for severance associated with headcount reductions and facility closures, $2.9 million for impairments and write-down of assets and $0.4 million in non-cash stock compensation expense. All of the charges, excluding a non-recurring gain of $0.2 million recorded in other income, were recorded in selling, general and administrative expenses within operating expenses.

"Year to date cost savings initiatives during 2009 are now estimated to have an annualized impact of approximately $35 million,” said Tom Oberdorf, infoGROUP’s Chief Financial Officer. "We will have new initiatives in the fourth quarter, which will further compound our savings.”

NON-GAAP INFORMATION

In addition to disclosing results determined in accordance with generally accepted accounting principles, or GAAP, infoGROUP also discloses the following non-GAAP measures: (1) earnings before interest expense, income taxes and depreciation and amortization, or EBITDA, (2) adjusted EBITDA excluding the effects of the non-recurring charges related to the Derivative Litigation, the Stipulation of Settlement, and the SEC investigation, restructuring costs, impairments and write-down of assets, litigation settlement charges, and non-cash stock compensation expense and (3) adjusted earnings (loss) per share excluding the effects of the non-recurring charges related to the Derivative Litigation, the Stipulation of Settlement and the SEC investigation, restructuring costs, impairments and write-down of assets, litigation settlement charges, and non-cash stock compensation expense.

Management believes EBITDA provides useful supplemental information to management and investors because management uses this information internally for evaluating the aggregate performance of the Company’s operating businesses. In addition, EBITDA is commonly used as an analytical indicator within infoGROUP’s industry and is a component of the Company’s financial covenant calculations under its credit facilities, subject to certain adjustments. Additionally, management excludes the effects of the non-recurring charges related to the Derivative Litigation, the Stipulation of Settlement and the SEC investigation and the restructuring costs, impairments and write-down of assets, litigation settlement charges, and non-cash stock compensation expense because such items resulted from events that are non-recurring and are not part of on-going operations. Management believes that adjusted earnings per share and adjusted EBITDA provide useful supplemental information to management and investors because they better reflect the Company’s on-going performance and business operations during the periods presented and are more useful to investors for comparative purposes.

All companies do not calculate non-GAAP measures in the same manner and the non-GAAP financial measures presented in this press release may not be comparable to similar measures used by other companies. Non-GAAP measures should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Non-GAAP financial measures have limitations in that they do not reflect all of the costs associated with the operations of the Company’s business as determined in accordance with GAAP. As a result, you should not consider these measures in isolation or as a substitute for analysis of the Company’s results as reported under GAAP as measures of the Company’s profitability or liquidity.

See the tables in this press release for a reconciliation of net income to non-GAAP EBITDA and non-GAAP adjusted EBITDA, and earnings (loss) per share to non-GAAP adjusted earnings per share.

CONFERENCE CALL

The Company will host its third quarter conference call on November 3, 2009 at 8:30 a.m. Eastern time. To access the conference call, please dial 877-397-0286 (international 719-325-4870), passcode 9803743, approximately 10 minutes prior to the start of the call. Those interested can also listen to an audio webcast of the call live on the Investor Relations section of the Company’s web site at www.infogroup.com. A replay of the call will be available after the call at the same link.

About infoGROUP

infoGROUP (NASDAQ: IUSA) is the leading provider of data and interactive resources that enables targeted sales, effective marketing and insightful research solutions. Our information powers innovative tools and insight for businesses to efficiently reach current and future customers through multiple channels, including the world’s most dominant and powerful Internet search engines and GPS navigation systems. infoGROUP headquarters are located at 5711 S. 86th Circle, Omaha, NE 68127. For more information, call (402) 593-4500 or visit www.infogroup.com.

Forward-Looking Statements

Statements in this announcement other than historical data and information constitute forward looking statements that involve risks and uncertainties that could cause actual results to differ materially from those stated or implied by such forward-looking statements. You can identify forward-looking statements by terminology such as "may,” "will,” "should,” "could,” "would,” "expects,” "intends,” "plans,” "anticipates,” "believes,” "estimates,” "predicts,” "potential,” "continues” or the negative of these terms or other comparable terminology. The potential risks and uncertainties include, but are not limited to, recent changes in senior management, risks associated with litigation, the successful integration of recent and future acquisitions, fluctuations in operating results, failure to successfully carry out our Internet strategy or to grow our Internet revenue, effects of leverage, changes in technology and increased competition. More information about potential factors that could affect the company's business and financial results is included in the Company's filings with the Securities and Exchange Commission.

The following provides a reconciliation of GAAP net income (loss) to non-GAAP EBITDA and non-GAAP adjusted EBITDA:

The following provides a reconciliation of GAAP basic earnings (loss) per share to non-GAAP adjusted basic earnings per share:

The following provides a reconciliation of GAAP selling, general and administrative expenses to non-GAAP selling, general and administrative expenses, excluding restructuring, non-recurring and non-cash charges:

The following provides a reconciliation of GAAP operating income (loss) to non-GAAP operating income, excluding restructuring, non-recurring and non-cash charges: