Vistaprint Reports Decline in Operating Income, Revenue Increase

VENLO, THE NETHERLANDS—Jan. 26, 2012—Vistaprint N.V. announced its financial results for the three-month period ended Dec. 31, 2011, the second quarter of its 2012 fiscal year.

Vistaprint’s revenue for the second quarter of fiscal year 2012 grew to $299.9 million, a 28 percent increase over revenue of $234.1 million reported in the same quarter a year ago. Excluding Albumprinter revenue of $15.7 million, total second quarter revenue was $284.2 million. There was no revenue recognized during the quarter from the acquired Webs business. ( Excluding the estimated impact from currency exchange rate fluctuations and revenue from acquired businesses, total revenue grew 21 percent from the same quarter a year ago.)

Operating income in the second quarter was $32.5 million, or 10.9 percent of revenue, and reflected a 15 percent decrease compared to $38.2 million, or 16.3 percent of revenue, in the same quarter a year ago.

“We are very pleased with our second quarter,” said Robert Keane, president and CEO. “The quarter reflects momentum in our strategy initiatives and investment in resources which we are confident will lead to future growth. Revenue was in the upper half of our guidance range due to strong sales of holiday and small business products during our seasonally strongest quarter of the year. We were able to deliver these great results in the organic business while negotiating, performing due diligence, carrying out closing activities and planning integration activities for two acquisitions.”

Other Financial Metrics (include Albumprinter and Webs results unless otherwise stated):

  • Gross margin (revenue minus the cost of revenue as a percent of total revenue) in the second quarter was 66.8 percent, compared to 66.3 percent in the same quarter a year ago. Excluding the Albumprinter business, gross margin was 67.0 percent.
  • GAAP net income for the second quarter was $31.7 million, or 10.6 percent of revenue, representing a 7 percent decrease compared to $34.0 million, or 14.5 percent of revenue in the same quarter a year ago.
  • Non-GAAP adjusted net income for the second quarter was $37.9 million, or 12.6 percent of revenue, representing a 6 percent decrease compared to $40.4 million, or 17.3 percent of revenue in the same quarter a year ago. Non-GAAP adjusted net income excludes $1.1 million of amortization expense for acquisition-related intangible assets and $5.0 million of share-based compensation expense and its related tax effect.
  • Capital expenditures in the second quarter were $13.4 million, or 4.5 percent of revenue.
  • During the second quarter, the company generated $81.1 million in cash from operations and $66.4 million in free cash flow, defined as cash from operations less purchases of property, plant and equipment, purchases of intangible assets not related to acquisitions, and capitalization of software and website development costs.

Operating Metrics (exclude Albumprinter and Webs results unless otherwise stated):

  • Vistaprint acquired approximately 2.9 million new customers in the second fiscal quarter ended Dec. 31, 2011, compared with 2.2 million in the same quarter a year ago, reflecting an increase of 32 percent.
  • On a trailing 12-month basis, unique active customer count was 12.9 million. Unique active customer count is the number of individual customers who purchased from us in a given period, with no regard to the frequency of purchase. This compares to 10.6 million in the twelve month period ended Dec. 31, 2010.
  • Total order volume in the second quarter of fiscal 2012 was approximately 8.3 million, reflecting an increase of approximately 28 percent over total orders of approximately 6.5 million in the same quarter a year ago.
  • Average order value in the second quarter, including revenue from shipping and processing, was $34.61, compared with $36.17 in the same quarter a year ago.
  • Revenue from customers in North America was $139.8 million, or 47 percent of total revenue in the second quarter. This represents 20 percent growth year over year in both reported terms and in constant currency.

Ernst Teunissen, executive vice president and CFO, said, “Based on the results of the first half of fiscal 2012, we remain confident we will deliver against our operational expectations for the full year. We are now updating our guidance for fiscal 2012 to reflect several items unrelated to our organic operational performance. First, currency rates have moved unfavorably since we last gave guidance in October 2011, which primarily impacts our revenue guidance in U.S. dollars. Second, we have repurchased a significant number of Vistaprint shares since October, which will benefit our earnings per share relative to our prior expectations. And finally, our expectations for the Webs acquisition are now incorporated into our guidance. As previously disclosed, we expect the Webs acquisition will add a small amount of revenue in the back half of the year, and will be dilutive to GAAP and non-GAAP earnings.”

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