WINDSOR, Conn. (AFX) - Direct-mail marketer Advo Inc. said Wednesday its fiscal third-quarter profit dropped 47 percent, hurt by the transition to a new order-entry system, a facility closure and costs related to its pending merger with Valassis Communications Inc.
Quarterly net income fell to $7 million, or 22 cents per share, from $13 million, or 41 cents per share, in the year-ago period. Revenue grew to $386.8 million from $353.6 million.
Wall Street had been expecting a profit of 34 cents per share on sales of $373.1 million.
Advo said the 2006 quarter includes one-time charges of 8 cents per share plus stock-based compensation costs of 3 cents per share.
During the quarter, Advo said the transition to a new order-entry system hurt earnings per share by between 6 cents and 9 cents. The closure of its Memphis, Tenn., production facility dragged earnings by another 3 cents per share, and its planned merger with competitor Valassis carried costs of 5 cents per share.
Advo shares fell 4 cents to close at $36.26 on the New York Stock Exchange.
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