UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-Q
 þ
    
    Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended March 31, 2009
  o
    
    Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from  to
 Commission File Number 001-34298
 infoGROUP Inc.
  DELAWARE
    
    47-0751545(State or other jurisdiction of
    
    (I.R.S. Employer Identificationincorporation or organization)
    
    Number)5711 SOUTH 86TH CIRCLE, OMAHA, NEBRASKA
    
    68127(Address of principal executive offices)
    
    (Zip Code)
  N/A
   þ o
  o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
(Do not check if a smaller reporting company)
    
    Smaller reporting company o
 o þ




---



##### 



info GROUP Inc.
 INDEX
 PART I  FINANCIAL INFORMATIONItem 1. Financial StatementsConsolidated Balance Sheets as of March 31, 2009 and December 31, 2008
    
    
    3Consolidated Statements of Operations for the Three Months Ended March 31, 2009 and 2008
    
    
    4Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2009 and 2008
    
    
    5Notes to Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    17Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    26Item 4. Controls and Procedures
    
    
    26PART II  OTHER INFORMATION
    
    
    27Item 1. Legal Proceedings
    
    
    27Item 5. Other Information
    
    
    28Item 6. Exhibits
    
    
    28Signature
    
    
    29Index to Exhibits
    
    
    30
 2




---



##### 



info GROUP INC. AND SUBSIDIARIES
 
 CONSOLIDATED BALANCE SHEETS
 (in thousands, except share and per share amounts)
 March 31,
    
    
    December 31,2009
    
    
    2008(UNAUDITED)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    46,308
    
    
    $
    4,691Marketable securities
    
    
    407
    
    
    
    992Trade accounts receivable, net of allowances of $2,904 and $2,177, respectively
    
    
    43,696
    
    
    
    56,030List brokerage trade accounts receivable,
net of allowances of $568 and $494, respectively
    
    
    76,704
    
    
    
    86,841Unbilled services
    
    
    10,357
    
    
    
    11,120Deferred income taxes
    
    
    8,537
    
    
    
    6,889Income taxes receivable
    
    
    
    
    
    
    3,287Prepaid expenses
    
    
    10,425
    
    
    
    9,382Escrow, current
    
    
    3,000
    
    
    
    Deferred marketing costs
    
    
    1,086
    
    
    
    1,004Assets held for sale
    
    
    3,091
    
    
    
    3,960Current assets of discontinued operations
    
    
    
    
    
    
    36,845Total current assets
    
    
    203,611
    
    
    
    221,041Property and equipment, net
    
    
    56,846
    
    
    
    59,235Goodwill
    
    
    353,888
    
    
    
    377,708Intangible assets, net
    
    
    67,590
    
    
    
    69,950Other assets
    
    
    2,487
    
    
    
    2,505Escrow, noncurrent
    
    
    10,000
    
    
    
    Noncurrent assets of discontinued operations
    
    
    
    
    
    
    84,844$
    694,422
    
    
    $
    815,283LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Current portion of long-term debt
    
    $
    2,880
    
    
    $
    2,899Accounts payable
    
    
    16,097
    
    
    
    29,569List brokerage trade accounts payable
    
    
    69,890
    
    
    
    79,827Accrued payroll expenses
    
    
    29,030
    
    
    
    32,128Accrued expenses
    
    
    16,621
    
    
    
    16,068Income taxes payable
    
    
    48,309
    
    
    
    Deferred revenue
    
    
    57,793
    
    
    
    59,140Current liabilities of discontinued operations
    
    
    
    
    
    
    16,659Total current liabilities
    
    
    240,620
    
    
    
    236,290Long-term debt, net of current portion
    
    
    196,335
    
    
    
    297,745Deferred income taxes
    
    
    9,309
    
    
    
    10,552Other liabilities
    
    
    5,577
    
    
    
    5,417Noncurrent liabilities of discontinued operations
    
    
    
    
    
    
    16,406Stockholders equity:Common stock, $.0025 par value. Authorized 295,000,000 shares; 57,262,813 shares
issued and outstanding at March 31, 2009 and 57,019,030 shares issued and
outstanding at December 31, 2008
    
    
    143
    
    
    
    142Paid-in capital
    
    
    148,285
    
    
    
    147,029Retained earnings
    
    
    105,588
    
    
    
    114,926Note receivable  shareholder
    
    
    (6,800
    )
    
    
    (9,000
    )Accumulated other comprehensive loss
    
    
    (4,635
    )
    
    
    (4,224
    )Total stockholders equity
    
    
    242,581
    
    
    
    248,873$
    694,422
    
    
    $
    815,283
 3




---



##### 



info GROUP INC. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (in thousands, except per share amounts)
 THREE MONTHS ENDEDMarch 31,2009
    
    
    2008(UNAUDITED)Net sales
    
    $
    127,537
    
    
    $
    153,292Costs and expenses:Cost of goods and services
    
    
    46,989
    
    
    
    51,190Selling, general and administrative
    
    
    70,136
    
    
    
    82,261Depreciation and amortization of operating assets
    
    
    4,759
    
    
    
    5,208Amortization of intangible assets
    
    
    2,934
    
    
    
    3,204Total operating costs and expenses
    
    
    124,818
    
    
    
    141,863Operating income
    
    
    2,719
    
    
    
    11,429Investment income (expense)
    
    
    (2
    )
    
    
    1,359Other income (expense)
    
    
    (625
    )
    
    
    205Interest expense
    
    
    (3,246
    )
    
    
    (5,387
    )Other expense, net
    
    
    (3,873
    )
    
    
    (3,823
    )Income (loss) before income taxes
    
    
    (1,154
    )
    
    
    7,606Income tax expense (benefit)
    
    
    (427
    )
    
    
    2,890Net income (loss) from continuing operations
    
    
    (727
    )
    
    
    4,716Income (loss) from discontinued operations, net of tax
    
    
    (8,612
    )
    
    
    1,885Net income (loss)
    
    $
    (9,339
    )
    
    $
    6,601Basic earnings (loss) per share:Income (loss) from continuing operations
    
    $
    (0.01
    )
    
    $
    0.08Income (loss) from discontinued operations
    
    $
    (0.15
    )
    
    $
    0.04Net income (loss)
    
    $
    (0.16
    )
    
    $
    0.12Basic weighted average shares outstanding
    
    
    57,113
    
    
    
    56,563Diluted earnings (loss) per share:Income (loss) from continuing operations
    
    $
    (0.01
    )
    
    $
    0.08Income (loss) from discontinued operations
    
    $
    (0.15
    )
    
    $
    0.04Net income (loss)
    
    $
    (0.16
    )
    
    $
    0.12Diluted weighted average shares outstanding
    
    
    57,113
    
    
    
    56,576
  4




---



##### 



info GROUP INC. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (in thousands)
 THREE MONTHS ENDEDMarch 31,2009
    
    
    2008(UNAUDITED)CASH FLOWS FROM OPERATING ACTIVITIES:Net income (loss)
    
    $
    (9,339
    )
    
    $
    6,601Net income (loss) from discontinued operations
    
    
    (8,612
    )
    
    
    1,885Net income (loss) from continuing operations
    
    
    (727
    )
    
    
    4,716Adjustments to reconcile net income to net cash provided by operating activities:Depreciation and amortization of operating assets
    
    
    4,759
    
    
    
    5,208Amortization of intangible assets
    
    
    2,934
    
    
    
    3,204Amortization of deferred financing fees
    
    
    312
    
    
    
    166Deferred income taxes
    
    
    (2,873
    )
    
    
    (873
    )Non-cash stock compensation expense
    
    
    428
    
    
    
    162Non-cash 401(k) contribution in common stock
    
    
    830
    
    
    
    806(Gain) loss on sale of assets and marketable securities
    
    
    29
    
    
    
    (1,452
    )Non-cash other expense (income)
    
    
    (9
    )
    
    
    75Asset impairment charges
    
    
    2,060
    
    
    
    Changes in assets and liabilities, net of effect of acquisitions:Trade accounts receivable
    
    
    13,302
    
    
    
    11,701List brokerage trade accounts receivable
    
    
    10,137
    
    
    
    14,066Prepaid expenses and other assets
    
    
    (13,999
    )
    
    
    (1,489
    )Deferred marketing costs
    
    
    (82
    )
    
    
    150Accounts payable
    
    
    (13,509
    )
    
    
    5,160List brokerage trade accounts payable
    
    
    (9,937
    )
    
    
    (15,787
    )Income taxes receivable and payable, net
    
    
    51,580
    
    
    
    (1,649
    )Accrued expenses and other liabilities
    
    
    (2,442
    )
    
    
    (11,353
    )Deferred revenue
    
    
    (1,536
    )
    
    
    (486
    )Net cash
provided by operating activities  continuing operations
    
    
    41,257
    
    
    
    12,325Net cash provided by (used in) operating activities  discontinued operations
    
    
    (24,531
    )
    
    
    852Net cash provided by operating activities
    
    
    16,726
    
    
    
    13,177CASH FLOWS FROM INVESTING ACTIVITIES:Proceeds from sale of marketable securities
    
    
    9
    
    
    
    1,600Purchases of marketable securities
    
    
    
    
    
    
    (248
    )Proceeds from sale of property and equipment
    
    
    776
    
    
    
    36Purchases of property and equipment
    
    
    (1,659
    )
    
    
    (4,815
    )Acquisitions of businesses, net of cash acquired
    
    
    
    
    
    
    (17,727
    )Software development costs
    
    
    (1,900
    )
    
    
    (889
    )Net cash
used in investing activities  continuing operations
    
    
    (2,774
    )
    
    
    (22,043
    )Net cash
provided by (used in) investing activities  discontinued operations
    
    
    128,428
    
    
    
    (472
    )Net cash provided by (used in) investing activities
    
    
    125,654
    
    
    
    (22,515
    )CASH FLOWS FROM FINANCING ACTIVITIES:Repayments of long-term debt
    
    
    (105,429
    )
    
    
    (13,257
    )Proceeds from long-term debt
    
    
    4,000
    
    
    
    50,800Deferred financing costs paid
    
    
    (1,085
    )
    
    
    Dividends paid
    
    
    
    
    
    
    (19,793
    )Proceeds from shareholder for settlement
    
    
    2,200
    
    
    
    Tax benefit related to employee stock options
    
    
    
    
    
    
    10Proceeds from exercise of stock options
    
    
    
    
    
    
    69Net cash provided by (used in) financing activities  continuing operations
    
    
    (100,314
    )
    
    
    17,829Net cash used in financing activities  discontinued operations
    
    
    
    
    
    
    Net cash provided by (used in) financing activities
    
    
    (100,314
    )
    
    
    17,829Effect of exchange rate fluctuations on cash
    
    
    (449
    )
    
    
    99Net increase in cash and cash equivalents
    
    
    41,617
    
    
    
    8,590Cash and cash equivalents, beginning
    
    
    4,691
    
    
    
    9,924Cash and cash equivalents, ending
    
    $
    46,308
    
    
    $
    18,514Supplemental cash flow information:Interest paid
    
    $
    3,216
    
    
    $
    4,006Income taxes paid
    
    $
    981
    
    
    $
    6,137
  5




---



##### 



info GROUP INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 1. GENERAL
 info
  2. EARNINGS (LOSS) PER SHARE INFORMATION
  Three Months EndedMarch 31,(in thousands)2009
    
    2008Weighted average number of shares used in basic earnings
(loss) per share
    
    
    57,113
    
    
    
    56,563Net additional common stock equivalent shares outstanding
after assumed exercise of stock options
    
    
    
    
    
    
    13Weighted average number of shares outstanding used in
diluted earnings (loss) per share
    
    
    57,113
    
    
    
    56,576
  3. DISCONTINUED OPERATIONS
 Macro Divestiture
    6




---



##### 



Three Months EndedMarch 31,2009
    
    
    2008(in thousands)Net sales
    
    $
    35,440
    
    
    $
    37,818Operating income from discontinued operations before income taxes
    
    
    2,009
    
    
    
    3,040Gain from disposal of business
    
    
    25,240
    
    
    
    Income before income taxes
    
    
    27,249
    
    
    
    3,040Income tax expense
    
    
    (35,861
    )
    
    
    (1,155
    )Income (loss) from discontinued operations, net of tax
    
    $
    (8,612
    )
    
    $
    1,885
  Assets and Liabilities of Discontinued Operations
  December 31,2008(In thousands)Cash and cash equivalents
    
    $
    127Trade accounts receivable and unbilled services
    
    
    34,891Prepaid expenses
    
    
    647Deferred income taxes
    
    
    1,005Other assets
    
    
    175Currents assets of discontinued operations
    
    $
    36,845Property and equipment, net
    
    $
    5,873Goodwill and other intangibles
    
    
    78,971Noncurrent assets of discontinued operations
    
    $
    84,844Accounts payable
    
    $
    3,857Accrued payroll expenses
    
    
    7,920Accrued expenses
    
    
    1,672Deferred revenue
    
    
    3,210Current liabilities of discontinued operations
    
    $
    16,659Deferred income taxes
    
    $
    15,217Other liabilities
    
    
    1,189Noncurrent liabilities of discontinued operations
    
    $
    16,406
 7




---



##### 



4. ASSETS HELD FOR SALE
  5. SEGMENT INFORMATION
  info info
      For the Three Months Ended March 31, 2009Data
    
    Services
    
    Research
    
    Corporate
    
    ConsolidatedGroup
    
    Group
    
    Group
    
    Activities
    
    Total(In thousands)Net sales
    
    $
    67,276
    
    
    $
    35,752
    
    
    $
    24,509
    
    
    $
    
    
    
    $
    127,537Operating income (loss)
    
    
    12,917
    
    
    
    5,042
    
    
    
    (164
    )
    
    
    (15,076
    )
    
    
    2,719Investment income expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2
    )
    
    
    (2
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,246
    )
    
    
    (3,246
    )Other expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (625
    )
    
    
    (625
    )Income (loss) before income taxes
    
    
    12,917
    
    
    
    5,042
    
    
    
    (164
    )
    
    
    (18,949
    )
    
    
    (1,154
    )
 For the Three Months Ended March 31, 2008Data
    
    Services
    
    Research
    
    Corporate
    
    ConsolidatedGroup
    
    Group
    
    Group
    
    Activities
    
    Total(In thousands)Net sales
    
    $
    83,416
    
    
    $
    40,436
    
    
    $
    29,440
    
    
    $
    
    
    
    $
    153,292Operating income (loss)
    
    
    18,063
    
    
    
    7,283
    
    
    
    982
    
    
    
    (14,899
    )
    
    
    11,429Investment income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,359
    
    
    
    1,359Interest expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,387
    )
    
    
    (5,387
    )Other income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    205
    
    
    
    205Income (loss) before income taxes
    
    
    18,063
    
    
    
    7,283
    
    
    
    982
    
    
    
    (18,722
    )
    
    
    7,606
 8




---



##### 



6. COMPREHENSIVE INCOME (LOSS)
  For the ThreeMonths EndedMarch 31,
    
    
    March 31,2009
    
    
    2008(In thousands)Net income (loss)
    
    $
    (9,339
    )
    
    $
    6,601Other comprehensive loss:Unrealized gain (loss) from investments:Unrealized gains (losses)
    
    
    11
    
    
    
    (1,817
    )Related tax benefit (expense)
    
    
    (4
    )
    
    
    654Net
    
    
    7
    
    
    
    (1,163
    )Foreign currency translation adjustments:Unrealized gains (losses)
    
    
    (416
    )
    
    
    177Related tax expense
    
    
    (10
    )
    
    
    (64
    )Net
    
    
    (426
    )
    
    
    113Unrealized gain from pension plan:Unrealized gains
    
    
    27
    
    
    
    13Related tax expense
    
    
    (10
    )
    
    
    (5
    )Net
    
    
    17
    
    
    
    8Unrealized loss from derivative financial instruments:Unrealized losses
    
    
    (14
    )
    
    
    (14
    )Related tax benefit
    
    
    5
    
    
    
    5Net
    
    
    (9
    )
    
    
    (9
    )Total other comprehensive loss
    
    
    (411
    )
    
    
    (1,051
    )Comprehensive income (loss)
    
    $
    (9,750
    )
    
    $
    5,550
  Foreign
    
    
    Unrealized
    
    
    
    
    
    
    AccumulatedUnrealized
    
    
    Currency
    
    
    Gains
    
    
    Derivative
    
    
    OtherLosses from
    
    
    Translation
    
    
    From
    
    
    Financial
    
    
    ComprehensivePension Plan
    
    
    Adjustments
    
    
    Investments
    
    
    Instruments
    
    
    Loss(In thousands)Balance at March 31, 2009
    
    $
    (1,200
    )
    
    $
    (3,806
    )
    
    $
    7
    
    
    $
    364
    
    
    $
    (4,635
    )Balance at December 31, 2008
    
    $
    (1,217
    )
    
    $
    (3,380
    )
    
    $
    
    
    
    $
    373
    
    
    $
    (4,224
    )
 7. ACQUISITIONS
   9




---



##### 



8. SHAREBASED PAYMENT ARRANGEMENTS
  info
  Weighted
    
    
    
    
    
    WeightedAverage
    
    Weighted
    
    AverageNumber of
    
    Average
    
    Remaining
    
    Aggregate IntrinsicOptions
    
    Exercise
    
    Contractual
    
    ValueShares
    
    Price
    
    Term (Year)
    
    (In thousands)Outstanding at December 31, 2008
    
    
    570,000
    
    
    $
    12.09Granted
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    Outstanding at March 31, 2009
    
    
    570,000
    
    
    
    12.09
    
    
    
    6.20
    
    
    $
    Options exercisable at March 31, 2009
    
    
    233,999
    
    
    $
    12.68
    
    
    
    5.91
    
    
    $
    
   WeightedWeighted
    
    Weighted
    
    AverageAverage
    
    Average
    
    Remaining
    
    AggregateNumber of
    
    Intrinsic
    
    Contractual
    
    Intrinsic ValueRSUs
    
    Value
    
    Term (Year)
    
    (In thousands)Outstanding at December 31, 2008
    
    
    857,080
    
    
    $
    4.74Granted
    
    
    122,970
    
    
    
    4.31Converted
    
    
    
    
    
    
    Forfeited
    
    
    61,601
    
    
    
    Outstanding at March 31, 2009
    
    
    918,449
    
    
    
    4.16
    
    
    
    1.84
    
    
    $
    3,821
  10




---



##### 



9. RESTRUCTURING CHARGES
    December 31,
    
    
    
    
    
    
    
    
    
    
    March 31,2008
    
    
    
    
    
    
    
    
    
    
    2009Beginning
    
    
    Amounts
    
    
    Amounts
    
    
    EndingAccrual
    
    
    Expensed
    
    
    Paid
    
    
    Accrual(in thousands)Data Group:Employee separation costs
    
    $
    194
    
    
    $
    881
    
    
    $
    107
    
    
    $
    968Facility closure costs
    
    $
    143
    
    
    $
    293
    
    
    $
    436
    
    
    $
    Services Group:Employee separation costs
    
    $
    1,489
    
    
    $
    538
    
    
    $
    374
    
    
    $
    1,653Facility closure costs
    
    $
    
    
    
    $
    360
    
    
    $
    12
    
    
    $
    348Research Group:Employee separation costs
    
    $
    584
    
    
    $
    468
    
    
    $
    211
    
    
    $
    841Facility closure costs
    
    $
    
    
    
    $
    95
    
    
    $
    95
    
    
    $
    Corporate Activities:Employee separation costs
    
    $
    409
    
    
    $
    6
    
    
    $
    
    
    
    $
    415Facility closure costs
    
    $
    296
    
    
    $
    
    
    
    $
    296
    
    
    $
    
 11




---



##### 



10.     FAIR VALUE MEASUREMENTS
 
    Fair Value Measurements at March 31, 2009 UsingQuoted Prices inActive Markets for
    
    Significant Other
    
    SignificantIdentical Assets
    
    Observable Inputs
    
    Unobservablein thousands
    
    (Level 1)
    
    (Level 2)
    
    Inputs (Level 3)
    
    Total
    
    LossAssets held for sale
    
    $
    
    
    
    $
    3,091
    
    
    $
    
    
    
    $
    3,091
    
    
    $
    (113
    )Noncurrent
investments
    
    
    
    
    
    
    44
    
    
    
    
    
    
    
    44
    
    
    
    (14
    )Property and
equipment
    
    
    
    
    
    
    
    
    
    
    631
    
    
    
    631
    
    
    
    (451
    )Intangible assets
    
    
    
    
    
    
    
    
    
    
    961
    
    
    
    961
    
    
    
    (413
    )Total
    
    $
    
    
    
    $
    3,135
    
    
    $
    1,592
    
    
    $
    4,727
    
    
    $
    (991
    )
  12




---



##### 



11. GOODWILL AND INTANGIBLE ASSETS
  March 31, 2009
    
    
    December 31, 2008(in thousands)Accumulated
    
    
    
    
    
    
    
    
    
    
    AccumulatedCost
    
    
    Amortization
    
    
    Net
    
    
    Cost
    
    
    Amortization
    
    
    NetGoodwill
    
    $
    353,888
    
    
    $
    
    
    
    $
    353,888
    
    
    $
    377,708
    
    
    $
    
    
    
    $
    377,708Other intangible assets:Non-compete agreements
    
    
    16,835
    
    
    
    14,454
    
    
    
    2,381
    
    
    
    16,911
    
    
    
    14,265
    
    
    
    2,646Core technology
    
    
    15,281
    
    
    
    14,349
    
    
    
    932
    
    
    
    15,323
    
    
    
    13,665
    
    
    
    1,658Customer base
    
    
    58,028
    
    
    
    29,098
    
    
    
    28,930
    
    
    
    58,638
    
    
    
    27,874
    
    
    
    30,764Trade names
    
    
    30,661
    
    
    
    15,060
    
    
    
    15,601
    
    
    
    30,741
    
    
    
    14,664
    
    
    
    16,077Purchased data processing software
    
    
    73,478
    
    
    
    73,478
    
    
    
    
    
    
    
    73,478
    
    
    
    73,478
    
    
    
    Acquired database costs
    
    
    87,971
    
    
    
    87,971
    
    
    
    
    
    
    
    87,971
    
    
    
    87,971
    
    
    
    Perpetual software license agreements
    
    
    8,000
    
    
    
    8,000
    
    
    
    
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    Software and database development costs
    
    
    31,608
    
    
    
    15,947
    
    
    
    15,661
    
    
    
    30,299
    
    
    
    14,807
    
    
    
    15,492Deferred financing costs
    
    
    15,573
    
    
    
    11,488
    
    
    
    4,085
    
    
    
    14,488
    
    
    
    11,175
    
    
    
    3,313Total intangibles
    
    $
    691,323
    
    
    $
    269,845
    
    
    $
    421,478
    
    
    $
    713,557
    
    
    $
    265,899
    
    
    $
    447,658
    12. PROPERTY AND EQUIPMENT
  March 31,
    
    
    December 31,2009
    
    
    2008(In thousands)Property and equipment
    
    $
    198,696
    
    
    $
    197,756Less accumulated depreciation
    
    
    141,850
    
    
    
    138,521$
    56,846
    
    
    $
    59,235
  13




---



##### 



13. CONTINGENCIES
        14




---



##### 



14. RELATED PARTY TRANSACTIONS
     15. DEBT
    15




---



##### 



16. SUBSEQUENT EVENTS
 info
  16




---



##### 



ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
  General
 Overview
  info info info
  
    
    Continuing our focus on improved corporate governance, including operating under our
recently revamped formal policies, functioning under the guidance of our restructured
majority independent Board and working with our new management team.
    
    Continuing and expanding our initiatives of outreach, transparency and communications
with our shareholders and the entire investment community.
    
    Accelerating our organic, profitable growth by leveraging our leadership position as
a data provider across our subsidiaries, creating both internal and external strategic
alliances to add value to new and existing customers, and capitalizing on our existing
cross selling opportunities among subsidiaries. We anticipate concentrating our efforts
on these opportunities for internal growth, instead of pursuing revenue growth primarily
through acquisitions.
    
    Reinvesting in the business to expand our product offerings, particularly in the
integrated digital realm. We plan to provide our customers new products and services,
including more internet based and interactive marketing solutions.
    
    Improving our financial foundation, by reducing costs (without jeopardizing service
to our customers), continuing to aggressively reduce our debt levels and leveraging our
high margin products to increase profitability.
 Sales & Marketing Strategy
 info
  17




---



##### 



Growth Strategy
      18




---



##### 



RESULTS OF OPERATIONS
  CONSOLIDATED STATEMENT OF OPERATIONS DATA:
 Three Months
    
    Three MonthsEnded
    
    EndedMarch 31, 2009
    
    March 31, 2008Net sales
    
    
    100
    %
    
    
    100
    %Costs and expenses:Cost of goods and services
    
    
    37
    
    
    
    33Selling, general and administrative
    
    
    55
    
    
    
    55Depreciation
    
    
    4
    
    
    
    3Amortization
    
    
    2
    
    
    
    2Total costs and expenses
    
    
    98
    
    
    
    93Operating income
    
    
    2
    
    
    
    7Other expense, net
    
    
    (3
    )
    
    
    (2
    )Income (loss) before income taxes
    
    
    (1
    )
    
    
    5Income taxes
    
    
    
    
    
    
    2Net income (loss) from continuing operations
    
    
    
    
    
    
    3Income (loss) from discontinued operations, net of tax
    
    
    (6
    )
    
    
    1Net income (loss)
    
    
    (7
    )%
    
    
    4
    %
 OTHER DATA
 Three Months
    
    
    Three MonthsEnded
    
    
    EndedMarch 31, 2009
    
    
    March 31, 2008SALES BY SEGMENT:Data Group
    
    $
    67,276
    
    
    $
    83,416Services Group
    
    
    35,752
    
    
    
    40,436Marketing Research Group
    
    
    24,509
    
    
    
    29,440Total
    
    $
    127,537
    
    
    $
    153,292SALES BY SEGMENT AS A PERCENTAGE OF NET
SALES:Data Group
    
    
    53
    %
    
    
    55
    %Services Group
    
    
    28
    
    
    
    26Marketing Research Group
    
    
    19
    
    
    
    19Total
    
    
    100
    %
    
    
    100
    %
 Net sales
   19




---



##### 



Cost of goods and services
      Selling, general and administrative expenses
    20




---



##### 



nd
 Depreciation expense
      Amortization expense
     21




---



##### 



Operating income
      Other expense, net
  Income taxes
  Results of Discontinued Operations
  Liquidity and Capital Resources
 Overview
   22




---



##### 



23




---



##### 



Selected Consolidated Statements of Cash Flows Information
    Selected Consolidated Balance Sheet Information
        24




---



##### 



Off-Balance Sheet Arrangements
  Accounting Standards
 Fair Value Measurements Effective
Date of FASB Statement No. 157
 Business Combinations Business Combinations
 Determining Fair Value
When the Volume and Level of Activity for the Asset or Liability has Significantly decreased and
Identifying Transactions That Are Not Orderly
 25




---



##### 



Inflation
  
 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  
 ITEM 4. CONTROLS AND PROCEDURES
 (a) Evaluation of disclosure controls and procedures
    (b) Changes in internal control over financial reporting
  
    
    On December 5, 2008, the Company appointed a new Executive Vice President and Chief
Financial Officer.
    
    On December 12, 2008, the Company hired a new Director of GAAP Analysis to assist with
accounting for non-routine transactions. This individual reports directly to the Corporate
Controller.
  
    
    The SEC external reporting position will report directly to the Executive Vice President
and Chief Financial Officer.
    
    The Director of Financial Reporting will report directly to the Corporate Controller.
 
    
    The Group Controllers positions will all report directly to the Corporate Controller.
 26




---



##### 



PART II
 OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
      27




---



##### 



ITEM 5. OTHER INFORMATION
  
 ITEM 6. EXHIBITS
 Exhibit No.
    
    
    
    Description2.1
    
    
    
    Agreement and Plan of Merger, dated as June 28, 2007, by and among infoUSA Inc.,
Knickerbocker Acquisition Corp. and Guideline, Inc., incorporated herein by reference to Exhibit
2.1 filed with the Companys Current Report on Form 8-K filed July 5, 2007.3.1
    
    
    
    Certificate of Incorporation, as amended through October 22, 1999, incorporated herein by
reference to exhibits filed with our Registration Statement on Form 8-A, as amended, filed March
20, 2000.3.2
    
    
    
    Amended and Restated Certificate of Designation of Participating Preferred Stock, filed in
Delaware on May 5, 2009, incorporated herein by reference to exhibits filed with our Registration
Statement on Form 8-A, as amended, filed May 6, 2009.3.3
    
    
    
    Certificate of Ownership and Merger effecting the name change to infoGROUP Inc., incorporated
herein by reference to Exhibit 3.1 filed with our Current Report on Form 8-K, filed June 4, 20083.4
    
    
    
    Bylaws, incorporated herein by reference to our Annual Report on Form 10-K for the year ended
December 31, 2007, filed August 8, 2008.4.1
    
    
    
    Preferred Share Rights Agreement, incorporated herein by reference to our Registration Statement
on Form 8-A, as amended, filed May 6, 2009.4.2
    
    
    
    Specimen of Common Stock Certificate, incorporated herein by reference to the exhibits filed with
our Registration Statement on Form 8-A, as amended, filed March 20, 2000.31.1*
    
    
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.31.2*
    
    
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.32.1*
    
    
    
    Certification of Chief Executive Officer pursuant to Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.32.2*
    
    
    
    Certification of Chief Financial Officer pursuant to Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Filed herewith 28




---



##### 



SIGNATURE
  infoGROUP Inc.Date: May 11, 2009
    /s/ Thomas OberdorfThomas OberdorfExecutive Vice President and Chief Financial Officer 29




---



##### 



INDEX TO EXHIBITS
 ExhibitNo.
    
    
    
    Description2.1
    
    
    
    Agreement and Plan of Merger, dated as June 28, 2007, by and among infoUSA Inc.,
Knickerbocker Acquisition Corp. and Guideline, Inc., incorporated herein by reference to Exhibit
2.1 filed with the Companys Current Report on Form 8-K filed July 5, 2007.3.1
    
    
    
    Certificate of Incorporation, as amended through October 22, 1999, incorporated herein by
reference to exhibits filed with our Registration Statement on Form 8-A, as amended, filed March
20, 2000.3.2
    
    
    
    Amended and Restated Certificate of Designation of Participating Preferred Stock, filed in
Delaware on May 5, 2009, incorporated herein by reference to exhibits filed with our Registration
Statement on Form 8-A, as amended, filed May 6, 2009.3.3
    
    
    
    Certificate of Ownership and Merger effecting the name change to infoGROUP Inc., incorporated
herein by reference to Exhibit 3.1 filed with our Current Report on Form 8-K, filed June 4, 20083.4
    
    
    
    Bylaws, incorporated herein by reference to our Annual Report on Form 10-K for the year ended
December 31, 2007, filed August 8, 2008.4.1
    
    
    
    Preferred Share Rights Agreement, incorporated herein by reference to our Registration Statement
on Form 8-A, as amended, filed May 6, 2009.4.2
    
    
    
    Specimen of Common Stock Certificate, incorporated herein by reference to the exhibits filed with
our Registration Statement on Form 8-A, as amended, filed March 20, 2000.31.1*
    
    
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.31.2*
    
    
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.32.1*
    
    
    
    Certification of Chief Executive Officer pursuant to Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.32.2*
    
    
    
    Certification of Chief Financial Officer pursuant to Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.
 
  30