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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
X Quarterly Report Pursuant to Section 13 or 15(d) of The Securities
--- Exchange Act of 1934.
For the quarterly period ended June 30, 2003
Transition report pursuant to Section 13 or 15(d) of the Securities
--- Exchange Act of 1934.
Commission file number 0-11428
INFORMATION RESOURCES, INC.
---------------------------
(Exact name of registrant as specified in its charter)
Delaware 36-2947987
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
150 North Clinton Street, Chicago, Illinois 60661
-------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (312) 726-1221
--------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [X] No [ ]
The number of shares of the registrant's common stock, $.01 par value per
share outstanding, as of July 31, 2003 was 30,176,734.
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
INDEX
PAGE
NUMBER
PART I. FINANCIAL INFORMATION
Condensed Consolidated Balance Sheets 3
Condensed Consolidated Statements of Operations 4
Condensed Consolidated Statements of Cash Flows 5
Notes to Condensed Consolidated Financial Statements 6
Management's Discussion and Analysis of
Financial Condition and Results of Operations 14
Item 4 - Controls and Procedures 20
PART II. OTHER INFORMATION
Item 4 - Submission of Matters to a
Vote of Security Holders 21
Item 6 - Exhibits and Reports on Form 8-K 21
Signatures 23
2
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
ASSETS JUNE 30, 2003 DECEMBER 31, 2002
- ------ ------------- -----------------
(UNAUDITED)
CURRENT ASSETS
Cash and cash equivalents $ 11,339 $ 8,968
Accounts receivable, net 76,218 85,453
Prepaid expenses and other 12,118 15,801
--------- ---------
Total Current Assets 99,675 110,222
--------- ---------
Property and equipment, at cost 241,601 234,857
Accumulated depreciation (186,191) (171,478)
--------- ---------
Net property and equipment 55,410 63,379
Deferred income taxes 5,901 6,286
Investments 13,050 13,165
Other assets 171,537 166,145
--------- ---------
$ 345,573 $ 359,197
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
CURRENT LIABILITIES
Current maturities of capitalized leases $ 3,637 $ 3,639
Accounts payable 62,455 66,614
Accrued compensation and benefits 10,732 17,797
Accrued property, payroll and other taxes 2,557 1,876
Accrued expenses 5,907 6,207
Accrued restructuring costs 2,738 7,838
Deferred revenue 34,346 36,247
--------- ---------
Total Current Liabilities 122,372 140,218
--------- ---------
Long-term debt 5,332 4,495
Other liabilities 10,212 10,812
STOCKHOLDERS' EQUITY
Preferred stock-authorized, 1,000,000 shares,
$.01 par value; none issued -- --
Common stock - authorized 60,000,000 shares,
$.01 par value, 30,018,050 and 29,808,550
shares issued and outstanding, respectively 303 301
Additional paid-in capital 203,349 202,857
Retained earnings 6,963 6,906
Accumulated other comprehensive loss (2,958) (6,392)
--------- ---------
Total Stockholders' Equity 207,657 203,672
--------- ---------
$ 345,573 $ 359,197
========= =========
The accompanying notes are an integral part of these statements.
3
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
THREE MONTHS ENDED SIX MONTHS ENDED
------------------ ----------------
JUNE 30, JUNE 30,
-------- --------
2003 2002 2003 2002
---- ---- ---- ----
Information services revenues $ 142,360 $ 139,832 $ 280,032 $ 272,951
Costs and expenses:
Information services sold (128,052) (125,580) (254,854) (246,131)
Selling, general and administrative expenses (12,346) (12,255) (22,346) (23,007)
Special charges, net (2,272) (1,860) (2,272) (7,152)
--------- --------- --------- ---------
(142,670) (139,695) (279,472) (276,290)
--------- --------- --------- ---------
Operating income (loss) (310) 137 560 (3,339)
Interest expense (200) (283) (346) (343)
Other, net 92 502 (65) 143
Equity in earnings (losses) of affiliated companies 43 225 (108) 266
Minority interest benefit 20 96 64 395
--------- --------- --------- ---------
Income (loss) before income taxes and cumulative effect of
accounting change (355) 677 105 (2,878)
Income tax benefit (expense) 154 (384) (46) 880
--------- --------- --------- ---------
Income (loss) before cumulative
effect of accounting change (201) 293 59 (1,998)
Cumulative effect of accounting change-
impairment of goodwill -- -- -- (7,065)
--------- --------- --------- ---------
Net income (loss) $ (201) $ 293 $ 59 $ (9,063)
========= ========= ========= =========
Net income (loss) per common share before cumulative
effect of accounting change - basic $ (.01) $ .01 $ -- $ (.07)
========= ========= ========= =========
Net income (loss) per common share - basic $ (.01) $ .01 $ -- $ (.31)
========= ========= ========= =========
Net income (loss) per common and common equivalent share
before cumulative effect of accounting change - diluted $ (.01) $ .01 $ -- $ (.07)
========= ========= ========= =========
Net income (loss) per common and common equivalent
share - diluted $ (.01) $ .01 $ -- $ (.31)
========= ========= ========= =========
Weighted average common shares - basic 29,820 29,526 29,814 29,511
========= ========= ========= =========
Weighted average common and
common equivalent shares - diluted 29,820 30,909 29,904 29,511
========= ========= ========= =========
The accompanying notes are an integral part of these statements.
4
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
SIX MONTHS ENDED
----------------
JUNE 30,
--------
2003 2002
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 59 $ (9,063)
Adjustments to reconcile net income (loss) to net cash provided by
operating activities:
Amortization of deferred data procurement costs 72,643 64,391
Depreciation 12,894 13,704
Amortization of capitalized software costs and intangibles 1,146 1,665
Special charges, net of cash paid (5,100) (178)
Deferred income tax expense (benefit) 46 (880)
Equity in losses (earnings) of affiliated companies and minority
interests 44 (660)
Impairment of goodwill - 7,065
Other 61 82
Change in assets and liabilities:
Accounts receivable 9,145 (10,135)
Other current assets 3,683 1,506
Accounts payable and accrued liabilities (10,957) (9,167)
Deferred revenue (1,901) (1,894)
Other, net (2,054) (916)
-------- --------
Net cash provided by operating activities 79,709 55,520
CASH FLOWS FROM INVESTING ACTIVITIES:
Deferred data procurement costs (73,603) (69,004)
Purchase of property, equipment and software (4,182) (7,427)
Capitalized software costs (1,004) (1,016)
Other, net (1) 18
-------- --------
Net cash used by investing activities (78,790) (77,429)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net bank borrowings 2,455 17,000
Proceeds from issuance of stock and exercise of stock options 323 1,763
Net repayments of capitalized leases (1,972) (1,986)
-------- --------
Net cash provided by financing activities 806 16,777
EFFECT OF EXCHANGE RATE CHANGES ON CASH 646 330
-------- --------
Net increase (decrease) in cash and cash equivalents 2,371 (4,802)
Cash and cash equivalents at beginning of period 8,968 13,708
-------- --------
Cash and cash equivalents at end of period $ 11,339 $ 8,906
======== ========
The accompanying notes are an integral part of these statements.
5
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 - BASIS OF PRESENTATION
Principles of consolidation: The condensed consolidated financial
statements include the accounts of Information Resources, Inc. and all wholly or
majority owned subsidiaries and affiliates (collectively "the Company").
Minority interests reflect the non-Company owned stockholder interests in
certain international operations. The equity method of accounting is used for
investments in which the Company has a 20% to 50% ownership interest because it
exercises significant influence over operating and financial policies. All
significant intercompany accounts and transactions have been eliminated in
consolidation.
Interim financial statements: The interim financial statements are
unaudited, but include all adjustments (consisting of normal recurring
adjustments) necessary, in the opinion of management, for a fair statement of
financial position and results of operations for the period presented. The
preparation of interim financial statements necessarily relies on estimates,
requiring the use of caution in estimating results for the full year based on
interim results of operations.
Income (loss) per common and common equivalent share: Net income (loss) per
share is based upon the weighted average number of shares of common stock
outstanding during each period. Net income (loss) per common and common
equivalent share-diluted is based upon the weighted average number of shares of
common stock and common stock equivalents, entirely comprised of stock options,
outstanding during each period. For the first half of 2003 and 2002, stock
options, aggregating 8,531,768 shares and 9,065,710 shares, respectively, were
excluded from the weighted average shares outstanding calculation because they
were anti-dilutive. For the second quarter of 2003 and 2002, stock options
aggregating 8,831,489 and 2,745,850 shares were excluded from the weighted
average shares outstanding calculation because they were anti-dilutive.
Stock-Based Compensation: Statement of Financial Accounting Standards No.
123, "Accounting for Stock-Based Compensation," as amended by Statement of
Financial Accounting Standards No. 148, "Accounting for Stock-Based Compensation
- - Transition and Disclosure," encourages, but does not require, companies to
record compensation cost for stock-based employee compensation plans at fair
value. The Company has chosen to account for stock-based compensation using the
intrinsic value method prescribed in Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees," and related interpretations.
Accordingly, compensation expense for stock options is measured as the excess,
if any, of the quoted market price of the Company's stock at the date of the
grant over the amount an employee must pay to acquire the stock. The Company
grants options at the quoted market price of the stock and therefore recognizes
no compensation expense.
6
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, CONT'D.
(UNAUDITED)
The following table illustrates the effect on the net income (loss) and net
income (loss) per share for the second quarter and the first six months ended
June 30, 2003 and 2002 if the Company had applied the fair value recognition
provisions of Statement of Financial Accounting Standards No. 123, "Accounting
for Stock-Based Compensation," to stock-based employee compensation (in
thousands, except per share data):
THREE MONTHS ENDED SIX MONTHS ENDED
------------------ ----------------
JUNE 30, JUNE 30,
-------- --------
2003 2002 2003 2002
----- ----- ---- ----
Net income (loss), as reported $ (201) $ 293 $ 59 $ (9,063)
Deduct: Total stock-based employee compensation expense
determined under fair value based method for all awards,
net of related tax effects (736) (907) (1,541) (1,812)
---------- ----------- ----------- ----------
Net loss, pro forma $ (937) $ (614) $ (1,482) $ (10,875)
========== =========== =========== ==========
Earnings (loss) per share:
Basic-- as reported $ (.01) $ .01 $ - $ (.31)
========== =========== =========== ==========
Basic-- pro forma $ (.03) $ (.02) $ (.05) $ (.37)
========== =========== =========== ==========
Diluted-- as reported $ (.01) $ .01 $ - $ (.31)
========== =========== =========== ==========
Diluted-- pro forma $ (.03) $ (.02) $ (.05) $ (.37)
========== =========== =========== ==========
The above table is based upon the valuation of option grants using the
Black-Scholes pricing model for traded options with assumed risk-free interest
rates of 2.74% and 3.82% for 2003 and 2002, respectively; stock price volatility
factor of 86.1% for 2003 and 2002; and an expected life of the options of five
years. Using the foregoing assumptions, the calculated weighted-average fair
value of options granted in 2003 and 2002 was $.87 and $5.87, respectively.
Because the Company's employee stock options have characteristics significantly
different from those of traded options, and because changes in the input
assumptions can materially affect the fair value estimate, in management's
opinion, the model does not necessarily provide a reliable single measure of the
fair value of its employee stock options.
NOTE 2 - SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid for interest and income taxes during the period was as follows
(in thousands):
SIX MONTHS ENDED
----------------
JUNE 30,
--------
2003 2002
---- ----
Interest $343 $ 269
Income taxes 703 314
7
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, CONT'D.
(UNAUDITED)
Non-cash investing and financing activities are excluded from the
consolidated statement of cash flows. During the first half of 2003 and 2002,
the Company acquired computer equipment for $.4 million and $2.0 million,
respectively, in exchange for capital lease obligations.
NOTE 3 - ACCOUNTS RECEIVABLE
Accounts receivable were as follows (in thousands):
JUNE 30, 2003 DECEMBER 31, 2002
------------- -----------------
Billed $ 65,757 $ 70,216
Unbilled 15,446 19,832
-------- --------
81,203 90,048
Allowance for doubtful accounts (4,985) (4,595)
-------- --------
$ 76,218 $ 85,453
======== ========
NOTE 4 - INVESTMENTS AND OTHER ASSETS
Investments were as follows (in thousands):
JUNE 30, 2003 DECEMBER 31, 2002
------------- -----------------
Mosaic InfoForce, L.P., at cost plus equity in
undistributed earnings $ 4,737 $ 4,845
Datos Information Resources, at cost plus equity in
undistributed earnings 4,009 4,009
GfK Panel Services Benelux B.V., at cost 1,315 1,315
Middle East Market Research Bureau, at cost 2,761 2,768
Other 228 228
------- -------
$13,050 $13,165
======= =======
8
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, CONT'D.
(UNAUDITED)
Other assets were as follows (in thousands):
JUNE 30, 2003 DECEMBER 31, 2002
------------- -----------------
Deferred data procurement costs -
net of accumulated amortization of
$155,169 in 2003 and $152,635 in 2002 $166,154 $160,615
Capitalized software costs - net of
accumulated amortization of $1,797
in 2003 and $2,315 in 2002 4,473 4,341
Other - net of accumulated amortization of $6,017
in 2003 and $5,867 in 2002 910 1,189
-------- --------
$171,537 $166,145
======== ========
Effective January 1, 2002, the Company adopted Statement of Financial
Accounting Standards No. 142, "Goodwill and Other Intangible Assets." Under the
new rules, goodwill, the excess of the carrying value over the net book value of
investments accounted for using the equity method and intangible assets deemed
to have indefinite lives, are no longer amortized but are subject to annual
impairment tests. Other intangible assets continue to be amortized over their
useful lives.
The Company performed a goodwill impairment test as required by Statement
No. 142 to determine the implied fair value of the goodwill recorded on its
books as of January 1, 2002. As the goodwill related entirely to previous
international transactions, the fair value was estimated by discounting the
estimated future cash flows of the international reporting unit. Based on this
analysis, the Company recognized a goodwill impairment charge of $7.1 million.
In accordance with Statement No. 142, the charge was reflected as the cumulative
effect of a change in accounting principle in the Statement of Operations in the
first quarter of 2002.
NOTE 5 - LONG TERM DEBT
Long-term debt was as follows (in thousands):
JUNE 30, 2003 DECEMBER 31, 2002
------------- -----------------
Bank borrowings $ 2,455 $ -
Capitalized leases and other 6,514 8,134
------- -------
8,969 8,134
Less current maturities (3,637) (3,639)
------- -------
$ 5,332 $ 4,495
======= =======
9
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, CONT'D.
(UNAUDITED)
In July 2002, the Company entered into a $40.0 million credit facility
which expires in July 2005. The facility has floating rate interest options that
range between 2.25% and 3.00% over LIBOR and commitment fees of up to 0.50%
payable on the unused portion. Under the credit facility, the maximum commitment
of funds available for borrowings is limited by a defined borrowing base formula
related to eligible accounts receivable, which fluctuates during the quarter.
Borrowings under the facility are secured by the Company's assets. As of June
30, 2003, the Company had $17.2 million of borrowing availability, net of
letters of credit, under the revolving credit facility.
The financial covenants in the credit agreement, as well as in the lease
agreement for the Company's Chicago headquarters, require the Company to
maintain a minimum tangible net worth and to meet certain cash flow coverage and
leverage ratios. The agreements also limit the Company's ability to declare
dividends or make distributions to holders of capital stock, or redeem or
otherwise acquire shares of capital stock of the Company. The bank credit
agreement contains covenants which restrict the Company's ability to incur
additional indebtedness. As of June 30, 2003, the Company was in compliance with
all covenants.
NOTE 6 - COMPREHENSIVE INCOME (LOSS)
The comprehensive income (loss) summary shown below sets forth certain
items that affect stockholders' equity but are excluded from the presentation of
net earnings. The components of comprehensive income (loss) were as follows (in
thousands):
THREE MONTHS ENDED SIX MONTHS ENDED
------------------- -------------------
JUNE 30, JUNE 30,
-------- --------
2003 2002 2003 2002
---- ---- ---- ----
Net income (loss) $ (201) $ 293 $ 59 $(9,063)
Foreign currency translation
adjustment 2,441 4,569 3,434 3,636
------- ------- ------- -------
Comprehensive income (loss) $ 2,240 $ 4,862 $ 3,493 $(5,427)
======= ======= ======= =======
NOTE 7 - SEGMENT INFORMATION
The Company's business information services are conducted almost
exclusively in the United States and Europe. The Company's operations in other
markets account for less than 1% of consolidated revenues. The Company considers
revenues and the aggregation of operating profit (loss), equity earnings
(losses) and minority interests (collectively, "Operating Results") on a
geographic basis to be the most meaningful measure of the operating performance
of each respective geographic segment and of the Company as a whole.
10
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, CONT'D.
(UNAUDITED)
The following table presents certain information regarding the operations
of the Company by geographic segments (in thousands):
THREE MONTHS ENDED SIX MONTHS ENDED
------------------ ----------------
JUNE 30, JUNE 30,
-------- --------
2003 2002 2003 2002
---- ---- ---- ----
Revenues:
U.S. Services $ 101,664 $ 104,771 $ 201,814 $ 204,807
International Services 40,696 35,061 78,218 68,144
--------- --------- --------- ---------
Total Revenue $ 142,360 $ 139,832 $ 280,032 $ 272,951
========= ========= ========= =========
Operating Results:
U.S. Services $ 6,215 $ 6,299 $ 10,044 $ 12,541
International Services:
Operating loss (2,202) (3,133) (4,654) (5,956)
Equity in earnings (losses) of
affiliated companies -- -- -- (78)
Minority interest benefit 20 96 64 395
--------- --------- --------- ---------
Subtotal--International Services (2,182) (3,037) (4,590) (5,639)
Corporate and other expenses including
equity in affiliated companies (2,008) (944) (2,666) (2,428)
Special charges, net (a) (2,272) (1,860) (2,272) (7,152)
--------- --------- --------- ---------
Operating Results (247) 458 516 (2,678)
Interest expense and other, net (108) 219 (411) (200)
--------- --------- --------- ---------
Income (loss) before income taxes $ (355) $ 677 $ 105 $ (2,878)
========= ========= ========= =========
(a) Special charges for U.S. Services were $2.3 million and $1.9 million for the
three months ended June 30, 2003 and 2002, respectively. Special charges for
U.S. Services and International Services were $2.3 million and $0 million,
respectively, for the six months ended June 30, 2003 and $6.0 million and $1.1
million, respectively, for the six months ended June 30, 2002.
NOTE 8 - SPECIAL CHARGES
Since 1999, the Company has undertaken major initiatives as described below
resulting in significant or incremental expenditures that have been classified
as special charges in the Statement of Operations.
2003 Workforce Reduction: In the second quarter of 2003, the Company
eliminated approximately 110 full-time employees or approximately 5% of its
total workforce in the United States. The total charge for severance and other
costs approximates $2.4 million, of which $2.3 million was recorded in the
second quarter of 2003, and the remainder will be recorded in third quarter of
2003.
11
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, CONT'D.
(UNAUDITED)
2002 Workforce Reduction: In the fourth quarter of 2002, the Company
eliminated approximately 5% of its total workforce in the United States and
Europe through layoffs and the elimination of open positions. Approximately 140
full-time employees were terminated in the fourth quarter of 2002 and the
beginning of 2003. A charge of $7.8 million was recorded in the fourth quarter
of 2002 for severance and other costs related to the layoffs when communication
of such benefits had been made to affected employees.
Project Delta: In the third quarter of 1999, the Company initiated a
comprehensive program named Project Delta. The objective of Project Delta was to
improve productivity and operating efficiencies to reduce the Company's ongoing
cost structure in its U.S. operations. The work outlined as part of Project
Delta was completed during the third quarter of 2001.
Transition of German Production to U.S. Facility: The Company made the
decision in the fourth quarter of 1999 to transfer production services for
Information Resources GfK GmbH from an external vendor in Germany to the
Company's U.S. headquarters facility in order to enhance its InfoScan offering
in Germany and to reduce future production costs. The transition of German
production to the U.S. facility began in the first quarter of 2000 and was
completed in the first quarter of 2002. First quarter 2002 charges of $1.1
million consisted primarily of parallel processing and temporary workforce
expenses.
Information Technology Assessment: During the fourth quarter of 2001, the
Company began a review of its information technology operations to assess
potential restructuring costs and benefits. The review included initial
assessments of database design, transition planning and cost and savings
estimates and was completed in the second quarter of 2002. This project resulted
in cost savings, process efficiencies and a plan for continuous improvement of
the technology infrastructure. Charges of $6.3 million in the first half of 2002
related primarily to consulting fees paid to a third party.
The following tables reflect special charges incurred and cash payments
made during the first half of 2003 and 2002 (in thousands):
2003 ACTIVITY
-----------------------
LIABILITY AT LIABILITY AT
DECEMBER 31, 2002 PROVISION CASH JUNE 30, 2003
----------------- --------- ------- -------------
SPECIAL CHARGES
2003 workforce reduction $ - $ 2,272 $(1,046) $ 1,226
2002 workforce reduction 7,619 - (6,215) 1,404
Project Delta
Discontinued activities 219 - (111) 108
------- ------- ------- -------
$ 7,838 $ 2,272 $(7,372) $ 2,738
======= ======= ======= =======
12
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS, CONT'D.
(UNAUDITED)
2002 ACTIVITY
-------------
LIABILITY
(RECEIVABLE) AT LIABILITY AT
DECEMBER 31, 2001 PROVISION CASH JUNE 30, 2002
----------------- ---------- --------- --------------
SPECIAL CHARGES
Project Delta
Termination benefits $ 634 $ (240) $ (362) $ 32
Discontinued activities 265 - (12) 253
Transition of German production
to U.S. facility 592 1,131 (1,723) -
Information technology
assessment 1,413 6,261 (5,977) 1,697
OTHER ITEMS (1,036) - 1,036 -
------- ------- ------- -------
$ 1,868 $ 7,152 $(7,038) $ 1,982
======= ======= ======= =======
NOTE 9 - OTHER EVENTS
On June 29, 2003 the Company entered into an Agreement and Plan of Merger
("Merger Agreement") with Gingko Corporation and Gingko Acquisition Corp.
Pursuant to the Merger Agreement, on July 14, 2003, Gingko Acquisition Corp.
commenced a tender offer for all of the Company's outstanding common shares. The
transaction, which is subject to regulatory approval and other customary
conditions, is expected to close before the end of the year.
NOTE 10 - RECENT ACCOUNTING PRONOUNCEMENTS
In January 2003, the Financial Accounting Standards Board issued
Interpretation No. 46, "Consolidation of Variable Interest Entities, an
interpretation of Accounting Research Bulletin No. 51" ("Interpretation"). The
Interpretation requires the consolidation of entities in which an enterprise
absorbs a majority of the entity's expected losses, receives a majority of the
entity's expected residual returns, or both, as a result of ownership,
contractual or other financial interest in the entity. Currently, entities are
generally consolidated by an enterprise when it has a controlling financial
interest through ownership of a majority voting interest in the entity.
During 2000, the Company and Mosaic Group, Inc. formed a joint venture
company, Mosaic InfoForce, L.P. ("MIF"), in which the Company has a 49%
ownership interest and Mosaic Group, Inc., through wholly-owned subsidiaries,
owns the remainder. The Company's domestic causal and custom audit data
collection and merchandising services are provided by MIF pursuant to an
agreement that expires in 2010. The Company has evaluated its investment in MIF
and determined that it will begin consolidating MIF as of July 1, 2003. The
equity interest of MIF not owned by the Company will be reported as minority
interest beginning July 1, 2003.
MIF was financed with a $1.9 million initial equity contribution made by
the Company and an additional $2.1 million equity contribution made by Mosaic
Group, Inc., through wholly-owned subsidiaries. The Company capitalized $7.4
million in connection with the formation of MIF, which is currently being
accounted for using the equity method of accounting. As of June 30, 2003, the
Company has guaranteed $.9 million of MIF equipment capital leases that the
Company would be obligated to pay in the event MIF cannot make the payments
required under the leases. The capital leases have varying expiration dates
through 2004.
13
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following narrative discusses the results of operations, liquidity and
capital resources for the Company on a consolidated basis. This section should
be read in conjunction with IRI's Annual Report on Form 10-K for the fiscal year
ended December 31, 2002. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations" contained therein.
OVERVIEW
The Company's market is very competitive and as a result of certain trends
and general economic conditions, the industry is facing a number of challenges.
Specifically, increasing customer consolidation among consumer packaged goods
("CPG") manufacturers has caused the overall market for retail tracking services
to contract. In addition, retail tracking services offered by the Company and
its competitors, particularly in the U.S., now cover less of the total
marketplace than in prior years as a result of the decision by Wal-Mart in 2001
to discontinue providing its point-of-sale data to third party data suppliers,
including the Company and ACNielsen, and the emergence and growth of new
channels of trade that do not release point-of-sale data for inclusion in retail
tracking services. Further, general global economic conditions have resulted in
pricing pressure and reductions in overall customer spending on retail tracking
services. In addition, the Company has filed an antitrust lawsuit against The
Dun & Bradstreet Corp., A.C. Nielsen Co. (now owned by VNU, N.V.) and IMS
International, Inc. in which the Company alleges that it was the target of
numerous anticompetitive practices by the defendants aimed at excluding the
Company from the markets for retail tracking services. The Company believes that
such practices continue to impair its ability to compete in the markets and to
respond to the conditions confronting the industry. The Company expects these
conditions to continue to impact the consumer packaged goods industry and the
demand for retail tracking services for the foreseeable future.
The Company's first half 2003 U.S. retail tracking revenues, which comprise
73% of the U.S. business, declined by 3% compared to the first half of 2002. The
decline is the result of the financial lag of customer losses in 2002 that were
not fully offset by revenues generated from new customers and increased spending
by existing customers during the period.
The U.S. panel and analytics business is growing through increased spending
by existing customers, the addition of new customers and the introduction of new
products and services. First half 2003 panel and analytics revenues increased 8%
compared to the prior year. The Company anticipates continued growth in these
areas of its business as CPG companies require increasingly more and advanced
consumer intelligence and analysis.
The International operating loss was lower for the first half of 2003
compared to the prior year and continues to be driven primarily by the Company's
German operation. 2003 losses from the German operation increased over the prior
year as a result of difficulties encountered in connection with the Company's
transition to a new service in that country. The Company believes that most of
the operational difficulties in Germany have been addressed and that results
will improve in the second half of 2003. International operating results for the
first half of 2003, excluding Germany, improved by approximately $2.2 million
over the prior year largely due to expense reductions. Absent the losses
attributable to the German business, the International operation would have
reflected a profit in the first half of 2003.
On June 29, 2003 the Company entered into an Agreement and Plan of Merger
("Merger Agreement") with Gingko Corporation and Gingko Acquisition Corp.
Pursuant to the Merger Agreement, on July 14, 2003, Gingko Acquisition Corp.
commenced a tender offer for all of the Company's outstanding common shares. The
transaction, which is subject to regulatory approval and other customary
conditions, is expected to close before the end of the year.
14
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONT'D.
RESULTS OF OPERATIONS
The Company's consolidated net loss was $0.2 million or $.01 per diluted
share for the second quarter of 2003 compared to consolidated net income of $0.3
million or $.01 per diluted share for the corresponding 2002 quarter. The
Company's consolidated net income was $0.1 million for the six months ended June
30, 2003 compared to a consolidated net loss of $9.1 million or $.31 per diluted
share for the corresponding 2002 period. 2003 results improved primarily due to
the decline in special charges from the prior year. Additionally, 2002 results
included a charge of $7.1 million relating to the cumulative effect of an
accounting change for goodwill.
Second Quarter Versus Prior Year
Consolidated revenues for the quarter ended June 30, 2003 were $142.4
million, an increase of 2% over the corresponding quarter in 2002. U.S. revenues
were $101.7 million, a decrease of 3% compared to the prior year. Although U.S.
retail tracking revenues declined by 4% from the prior year, U.S. panel and
analytics revenues increased by 6%. International revenues increased 16% to
$40.7 million over the prior year, however, International revenues decreased 2%
on a local currency basis.
Consolidated costs of information services sold increased 2% to $128.1
million for the three months ended June 30, 2003 compared to $125.6 million for
the second quarter of 2002. This increase is primarily the result of foreign
currency exchange effects. While the Company incurred additional costs in
certain areas including investments in new business initiatives, these costs
were generally offset by savings in a number of other areas as a result of the
Company's ongoing cost saving efforts.
Consolidated selling, general and administrative expenses were $12.3
million for the three months ended June 30, 2003 and 2002.
Earnings before interest and other and taxes reflected a loss of $0.2
million for the second quarter of 2003 compared to income of $0.5 million in the
prior year. 2003 operating results declined primarily due to an increase in
corporate professional fee expenses relating to the pending merger transaction
and higher special charges in 2003. These expense increases were partially
offset by an improvement in International results.
Special charges are discussed below. Interest and other was a net expense
of $0.1 million for the second quarter of 2003 compared to interest and other
income of $0.2 million in 2002. The increase in expense resulted from higher
bank charges and lower foreign exchange gains in 2003 as compared to the prior
year.
First Half Versus Prior Year
Consolidated revenues were $280.0 million for the six months ended June 30,
2003, an increase of 3% over the corresponding period of 2002. U.S. revenues
decreased 1% to $201.8 million for the first half of 2003 compared to the prior
year. Although U.S. retail tracking revenues declined by 3% compared to the
first half of 2002, U.S. panel and analytics revenues increased by 8% compared
to the prior year. International revenues increased 15% to $78.2 million over
the first half of 2002, however, International revenues decreased 3% on a local
currency basis.
15
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONT'D.
Consolidated costs of information services sold increased 4% to $254.9
million for the six months ended June 30, 2003 compared to costs of $246.1
million for the first half of 2002. This increase is primarily the result of
foreign currency exchange effects. While the Company incurred additional costs
in certain areas including investments in new business initiatives, these costs
were generally offset by savings in a number of other areas as a result of the
Company's ongoing cost saving efforts.
Consolidated selling, general and administrative expenses decreased 3% to
$22.3 million for the six months ended June 30, 2003 compared to $23.0 million
for the first half of 2002. This decline is attributable to lower compensation
that was partially offset by foreign currency exchange effects and professional
fees incurred in connection with the pending merger transaction.
For the first half of 2003, the Company's earnings before interest and
other and taxes was $0.5 million compared to a loss of $2.7 million in the prior
year. This increase was the result of improved International results and lower
special charges that were partially offset by a decline in the U.S.
contribution.
Special charges are discussed below. Interest and other expenses were $0.4
million for the six months ended June 30, 2003 compared to $0.2 million in 2002.
The increase is due primarily to higher bank charges in 2003 as compared to the
prior year.
The Company adopted Statement of Financial Accounting Standards No. 142
"Goodwill and Other Intangible Assets" in the first quarter of 2002. The Company
performed a goodwill impairment test as required by Statement No. 142 to
determine the implied fair value of the goodwill recorded on its books as of
January 1, 2002. As the goodwill related entirely to previous international
transactions, the fair value was estimated by discounting the estimated future
cash flows of the international reporting unit. Based on this analysis, the
Company recognized a goodwill impairment charge of $7.1 million. In accordance
with Statement No. 142, the charge was reflected as the cumulative effect of a
change in accounting principle in the Statement of Operations in the first
quarter of 2002.
LIQUIDITY AND CAPITAL RESOURCES
The Company's current cash resources include its $11.3 million consolidated
cash balance and $17.2 million available, net of letters of credit, under the
Company's bank revolving credit facility as of June 30, 2003. The Company
anticipates that it will have sufficient funds from these sources and internally
generated funds from its U.S. operations to satisfy its cash needs for the
foreseeable future. The Company's bank credit agreement, which contains
covenants restricting the Company's ability to incur additional indebtedness,
expires in July 2005. The credit facility includes financial and non-financial
covenants discussed below. The Company expects to be in compliance with all of
its covenants during the remainder of 2003, however, if the Company violates a
covenant that the bank group is unwilling to amend or waive, and the bank group
declares a default under the credit agreement, liquidity could be negatively
impacted.
Financings
In July 2002, the Company entered into a $40.0 million credit facility
which expires in July 2005. The facility has floating rate interest options that
range between 2.25% and 3.00% over LIBOR and commitment fees of up to 0.50%
payable on the unused portion. Under the credit facility, the maximum commitment
of funds available for borrowings is limited by a defined borrowing base formula
related to eligible accounts receivable, which fluctuates during the quarter.
Borrowings under the facility are secured by the Company's assets.
16
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONT'D.
The financial covenants in the credit agreement, as well as in the lease
agreement for the Company's Chicago headquarters, require the Company to
maintain a minimum tangible net worth and to meet certain cash flow coverage and
leverage ratios. The agreements also limit the Company's ability to declare
dividends or make distributions to holders of capital stock, or redeem or
otherwise acquire shares of capital stock of the Company. As of June 30, 2003,
the Company was in compliance with all covenants.
Cash Flow
Consolidated net cash provided by operating activities was $79.7 million
for the six months ended June 30, 2003 compared to $55.5 million for the same
period in 2002. This increase was primarily attributable to improved earnings in
2003 and to changes in accounts receivable resulting from the timing of
collections.
Consolidated cash flow used by net investing activities was $78.8 million
in 2003 compared to $77.4 million for the same period in 2002. Investing
activity in 2003 reflects higher expenditures for data procurement, primarily
due to the impact of foreign currency, that were offset by lower capital
expenditures.
Consolidated cash flow provided by net financing activities was $0.8
million for the six months ended June 30, 2003 compared to $16.8 million for the
same period in 2002. During the six months ended June 30, 2003, the Company's
net bank borrowings aggregated $2.5 million compared to $17.0 million during the
first half of 2002.
Other Deferred Costs and Capital Expenditures
Consolidated deferred data procurement expenditures were $73.6 million for
the six months ended June 30, 2003 and $69.0 million for the same period in
2002. These expenditures are amortized over a period of 28 months, which is the
average number of months of back-data provided to clients, and include payments
to retailers for point-of-sale data and costs related to collecting, reviewing
and verifying other data (i.e. causal factors) which are an essential part of
the Company's database. Such expenditures for the Company's U.S. business were
$41.4 million and $40.9 million, while amortization expense was $40.7 million
and $38.7 million for the six months ended June 30, 2003 and 2002, respectively.
Expenditures for the Company's International business were $32.2 million and
$28.1 million, while amortization expense was $31.9 million and $25.7 million
for the six months ended June 30, 2003 and 2002, respectively. International
data expenditures for the first half of 2003 were higher than the prior year due
to the impact of foreign currency.
Consolidated capital expenditures were $4.2 million and $7.4 million for
the six months ended June 30, 2003 and 2002, respectively. Capital expenditures
for the Company's U.S. business were $2.3 million and $5.3 million, while
depreciation expense was $10.3 million and $11.4 million for the six months
ended June 30, 2003 and 2002, respectively. The decrease in U.S. capital
expenditures is primarily due to the timing of projects. The Company's
International capital expenditures were $1.9 million and $2.1 million, while
depreciation expense was $2.6 million and $2.3 million for the six months ended
June 30, 2003 and 2002, respectively.
Consolidated capitalized software development costs, primarily in the U.S.,
were $1.0 million for the first half of 2003 and 2002.
Impact of Inflation
Inflation has slowed in recent years, however the Company's results of
operations are impacted by rising prices given the labor intensive nature of the
business. The Company passes increased costs on to customers with multi-year
contracts by adjusting sales prices through consumer price index increases to
the extent provided for in such contracts.
17
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONT'D.
SPECIAL CHARGES
Since 1999, the Company has undertaken major initiatives as described below
resulting in significant or incremental expenditures that have been classified
as special charges in the Statement of Operations.
2003 Workforce Reduction: In the second quarter of 2003, the Company
eliminated approximately 110 full-time employees or approximately 5% of its
total workforce in the United States. The total charge for severance and other
costs approximates $2.4 million, of which $2.3 million was recorded in the
second quarter of 2003, and the remainder will be recorded in third quarter of
2003. The Company expects to realize cost savings of approximately $9.0 million
per year as a result of the workforce reduction.
2002 Workforce Reduction: In the fourth quarter of 2002, the Company
eliminated approximately 5% of its total workforce in the United States and
Europe through layoffs and the elimination of open positions. Approximately 140
full-time employees were terminated in the fourth quarter of 2002 and the
beginning of 2003. A charge of $7.8 million was recorded in the fourth quarter
of 2002 for severance and other costs related to the layoffs when communication
of such benefits had been made to affected employees. The Company expects to
realize cost savings of approximately $15.0 million per year as a result of the
workforce reduction.
Project Delta: In the third quarter of 1999, the Company initiated a
comprehensive program named Project Delta. The objective of Project Delta was to
improve productivity and operating efficiencies to reduce the Company's ongoing
cost structure in its U.S. operations. The work outlined as part of Project
Delta was completed during the third quarter of 2001.
Transition of German Production to U.S. Facility: The Company made the
decision in the fourth quarter of 1999 to transfer production services for
Information Resources GfK GmbH from an external vendor in Germany to the
Company's U.S. headquarters facility in order to enhance its InfoScan offering
in Germany and to reduce future production costs. The transition of German
production to the U.S. facility began in the first quarter of 2000 and was
completed in the first quarter of 2002. First quarter 2002 charges of $1.1
million consisted primarily of parallel processing and temporary workforce
expenses.
Information Technology Assessment: During the fourth quarter of 2001, the
Company began a review of its information technology operations to assess
potential restructuring costs and benefits. The review included initial
assessments of database design, transition planning and cost and savings
estimates and was completed in the second quarter of 2002. This project resulted
in cost savings, process efficiencies and a plan for continuous improvement of
the technology infrastructure. Charges of $6.3 million in the first half of 2002
related primarily to consulting fees paid to a third party.
18
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONT'D.
The following tables reflect special charges incurred and cash payments
made during the first half of 2003 and 2002 (in thousands):
2003 ACTIVITY
--------------------------
LIABILITY AT LIABILITY AT
DECEMBER 31, 2002 PROVISION CASH JUNE 30, 2003
----------------- --------- ------- -------------
SPECIAL CHARGES
2003 workforce reduction $ - $ 2,272 $(1,046) $ 1,226
2002 workforce reduction 7,619 - (6,215) 1,404
Project Delta
Discontinued activities 219 - (111) 108
------- ------- ------- -------
$ 7,838 $ 2,272 $(7,372) $ 2,738
======= ======= ======= =======
2002 ACTIVITY
--------------------------
LIABILITY
(RECEIVABLE) AT LIABILITY AT
DECEMBER 31, 2001 PROVISION CASH JUNE 30, 2002
----------------- --------- ------- -------------
SPECIAL CHARGES
Project Delta
Termination benefits $ 634 $ (240) $ (362) $ 32
Discontinued activities 265 - (12) 253
Transition of German
production to U.S. facility 592 1,131 (1,723) -
Information technology
assessment 1,413 6,261 (5,977) 1,697
OTHER ITEMS (1,036) - 1,036 -
------- ------- ------- -------
$ 1,868 $ 7,152 $(7,038) $ 1,982
======= ======= ======= =======
2003 Restructuring Charges: The Company incurred additional costs in the
third quarter of 2003 of approximately $1.3 million relating to the termination
of approximately 1% of its United States workforce.
19
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONT'D.
RECENT ACCOUNTING PRONOUNCEMENTS
In January 2003, the Financial Accounting Standards Board issued
Interpretation No. 46, "Consolidation of Variable Interest Entities, an
interpretation of Accounting Research Bulletin No. 51" ("Interpretation"). The
Interpretation requires the consolidation of entities in which an enterprise
absorbs a majority of the entity's expected losses, receives a majority of the
entity's expected residual returns, or both, as a result of ownership,
contractual or other financial interest in the entity. Currently, entities are
generally consolidated by an enterprise when it has a controlling financial
interest through ownership of a majority voting interest in the entity.
During 2000, the Company and Mosaic Group, Inc. formed a joint venture
company, Mosaic InfoForce, L.P. ("MIF"), in which the Company has a 49%
ownership interest and Mosaic Group, Inc., through wholly-owned subsidiaries,
owns the remainder. The Company's domestic causal and custom audit data
collection and merchandising services are provided by MIF pursuant to an
agreement that expires in 2010. The Company has evaluated its investment in MIF
and determined that it will begin consolidating MIF as of July 1, 2003. The
equity interest of MIF not owned by the Company will be reported as minority
interest beginning July 1, 2003.
MIF was financed with a $1.9 million initial equity contribution made by
the Company and an additional $2.1 million equity contribution made by Mosaic
Group, Inc., through wholly-owned subsidiaries. The Company capitalized $7.4
million in connection with the formation of MIF, which is currently being
accounted for using the equity method of accounting. As of June 30, 2003, the
Company has guaranteed $.9 million of MIF equipment capital leases that the
Company would be obligated to pay in the event MIF cannot make the payments
required under the leases. The capital leases have varying expiration dates
through 2004.
FORWARD LOOKING INFORMATION
Certain matters discussed in this Quarterly Report on Form 10-Q are
forward-looking statements that are subject to risks and uncertainties that
could cause actual results to differ materially from those anticipated. These
risks and uncertainties are described in reports and other documents filed by
the Company with the Securities and Exchange Commission including the Company's
Annual Report on Form 10-K for the year 2002.
ITEM 4. CONTROLS AND PROCEDURES
As of June 30, 2003, an evaluation was performed under the supervision and
with the participation of the Company's management, including the Chief
Executive Officer and Chief Financial Officer, of the effectiveness of the
design and operation of the Company's disclosure controls and procedures. Based
on that evaluation, the Company's management, including the Chief Executive
Officer and Chief Financial Officer, concluded that the Company's disclosure
controls and procedures were effective as of June 30, 2003. There have been no
significant changes in the Company's internal controls or in other factors that
could significantly affect internal controls subsequent to June 30, 2003.
20
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
PART II
OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Annual Meeting.
On May 15, 2003, Information Resources held its annual meeting of shareholders.
As of that date, shareholders of the Company's common shares outstanding were
entitled to 29,808,580 votes. At the meeting, the Company's shareholders voted
on the election of three directors, for three year terms. The results were as
follows:
Election of Directors Votes For Votes Withheld
--------------------- --------- --------------
Joseph P. Durrett 18,493,674 8,224,831
Bruce A. Gescheider 23,590,153 3,128,352
John D.C. Little, Ph.D. 23,548,492 3,170,013
The Company's shareholders also voted to amend the Company's 1996 Stock Plan for
Non-Employee Directors in Lieu of Cash Retainer to authorize the issuance of an
additional 250,000 shares of Company stock thereunder. The votes cast for were
23,327,337, votes against were 3,377,537 and abstentions were 13,631.
Additionally, the Company's shareholders voted to ratify the appointment of
Ernst & Young LLP as the Company's independent auditors for the fiscal year
ending December 31, 2003. The votes cast for were 26,218,292, votes against were
490,220 and abstentions were 9,993.
A more detailed description of the matters voted on by shareholders of the
Company at this meeting is included in the definitive Proxy Statement dated
April 16, 2003 and incorporated herein by reference.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
Exhibit No. Description of Exhibit
----------- ----------------------
31.1 Certification of CEO Pursuant to Section 302 of the
Sarbanes-Oxley Act
31.2 Certification of CFO Pursuant to Section 302 of the
Sarbanes-Oxley Act
32.1 Chief Executive Officer Certification of Periodic Report
32.2 Chief Financial Officer Certification of Periodic Report
99.1 Bank Consent and Amendment to Definition in Revolving Credit
Agreement dated July 12, 2002, effective April 22, 2003
21
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
b. Reports on Form 8-K.
During the second quarter of 2003, the Company filed a Current Report on
Form 8-K on April 24, 2003, covering Item 12, which contained the press release
announcing the Company's first quarter 2003 results of operations.
During the second quarter of 2003, the Company filed a Current Report on
Form 8-K on April 29, 2003, covering Item 5, which contained the press release
announcing that the U.S. District Court for the Southern District of New York
issued two key rulings for the Company in its antitrust lawsuit against The Dun
& Bradstreet Corp., A.C. Nielsen Co. and IMS International, Inc.
During the second quarter of 2003, the Company filed a Current Report on
Form 8-K on May 23, 2003, covering Item 5, which contained the press release
announcing that a U.S. District Court judge set a trial date of September 20,
2004 in the Company's antitrust lawsuit against The Dun & Bradstreet Corp., A.C.
Nielsen Co. and IMS International, Inc.
During the second quarter of 2003, the Company filed a Current Report on
Form 8-K on June 30, 2003, covering Items 5, 7 and 9 which contained the press
release announcing that the Company entered into an Agreement and Plan of
Merger, dated as of June 29, 2003, with Gingko Corporation and Gingko
Acquisition Corp.
22
INFORMATION RESOURCES, INC. AND SUBSIDIARIES
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
INFORMATION RESOURCES, INC.
---------------------------
(Registrant)
/s/ Andrew G. Balbirer
---------------------
Andrew G. Balbirer
Executive Vice President
and Chief Financial Officer
(Authorized Officer of Registrant)
/s/ Mary K. Sinclair
-------------------
Mary K. Sinclair
Controller
(Principal Accounting Officer)
August 13, 2003
23