EX-99.1 2 dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

LOGO

 

  Contacts:
  Investor Relations:
  Angela White
  ir@vistaprint.com
  + 1 (781) 652-6480
  Media Relations:
  Jason Keith
  publicrelations@vistaprint.com
  +1 (781) 652-6444

VistaPrint Reports 2009 Third Fiscal Quarter Financial Results

 

   

Quarterly revenue rose 21 percent year over year to $127.5 million

 

   

GAAP net income per fully diluted share rose 32 percent year over year to $0.33

 

   

Non-GAAP adjusted net income per fully diluted share rose 37 percent year over year to $0.44

Hamilton, Bermuda, April 30, 2009 — VistaPrint Limited (NASDAQ: VPRT), the small business marketing company, today announced financial results for the 2009 third fiscal quarter ended March 31, 2009.

“VistaPrint executed well in the third quarter with revenue in line with guidance and earnings that exceeded guidance,” said Robert Keane, president and chief executive officer. “These results reflect our strategy of growing both revenue and profits through a combination of new customer acquisition, geographic expansion, and enhanced customer value propositions. Equally important, VistaPrint’s ability to execute simultaneously on so many fronts reflects our continued dedication to operational and financial discipline.”

VistaPrint recently announced several key strategic and operational developments, including: the company’s decision to change its domicile to the Netherlands and re-establish a headquarters office (“quartiers généraux”) in Paris, France; VistaPrint’s strategic partnership with FedEx Office to provide marketing products and services in the US market; and the introduction of email marketing services.

 

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“We believe these exciting developments will help scale our operations, enhance our services, and reinforce our market leadership,” continued Keane. “The new email offering is a continuation of our strategy of being a turnkey marketing solution for small businesses. Our strategic partnership with FedEx Office should help us grow our US revenue by reaching new customers and by combining VistaPrint’s strengths with those of FedEx Office, the market leader in retail copy and print services. Finally, the re-domicile of our parent entity in the Netherlands and the re-establishment of an office in France underscores VistaPrint’s commitment to becoming a market leader in geographies worldwide.”

Financial Metrics:

 

   

Revenue for the third quarter of fiscal year 2009 grew to $127.5 million, a 21 percent increase over revenue of $105.8 million reported in the same quarter a year ago.

 

   

Gross margin (revenue minus the cost of revenue as a percent of total revenue) in the third quarter was 63.5 percent, compared to 61.3 percent in the same quarter a year ago.

 

   

Operating income in the third quarter was $16.0 million, or 12.5 percent of revenue, and reflected a 44 percent increase compared to $11.1 million, or 10.5 percent of revenue in the same quarter a year ago.

 

   

GAAP net income for the third quarter was $14.2 million, or 11.1 percent of revenue, representing a 24 percent increase compared to $11.5 million, or 10.8 percent of revenue in the same quarter a year ago.

 

   

GAAP net income per fully diluted share for the third quarter was $0.33, representing a 32 percent increase compared to $0.25 in the same quarter a year ago.

 

   

Non-GAAP adjusted net income for the third quarter, which excludes share-based compensation expense, was $18.9 million, or 14.8 percent of revenue, representing a 25 percent increase compared to $15.1 million, or 14.3 percent of revenue in the same quarter a year ago.

 

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Non-GAAP adjusted net income per fully diluted share for the third quarter, which excludes share-based compensation expense, was $0.44, representing a 37 percent increase compared to $0.32 in the same quarter a year ago.

 

   

Capital expenditures in the third quarter were $18.1 million, or 14.2 percent of revenue.

 

   

During the third quarter, the Company generated $19.5 million in cash from operations and $(0.5) million in free cash flow, defined as cash from operations less purchases of property, plant and equipment, and capitalization of software and website development costs.

 

   

The Company had $114.7 million in cash, cash equivalents and short-term marketable securities as of March 31, 2009.

Operating Highlights:

 

   

VistaPrint acquired approximately 1.5 million new customers in the third fiscal quarter ended March 31, 2009.

 

   

Repeat customers generated approximately 66 percent of total quarterly bookings in the third quarter, compared with 64 percent in the same quarter a year ago.

 

   

Average daily order volume in the third quarter of fiscal 2009 exceeded 44,000, reflecting an approximate 33 percent increase over an average of more than 33,000 orders per day in the same quarter a year ago.

 

   

Advertising spending in the third quarter was $24.4 million, or 19.2 percent of revenue, compared to $19.9 million, or 18.8 percent of revenue in the same quarter a year ago.

 

   

Non-US markets contributed 38 percent of total revenue in the third quarter, flat with 38 percent in the same quarter a year ago.

 

   

Average order value in the third quarter including revenue from shipping and processing was $31.06, a 5 percent decrease when compared to $32.54 in the same quarter a year ago.

 

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Web site sessions in the third quarter were 65.8 million, a 38 percent increase over 47.6 million in the same quarter a year ago.

 

   

Conversion rates were 6.0 percent in the third quarter of fiscal 2009, compared to 6.4 percent in the same quarter a year ago.

 

   

VistaPrint broadened its promotional product offerings with the introduction of key chains and mouse pads.

“Third quarter revenue results were in line with our guidance and we exceeded our earnings guidance due to the seasonal increase in revenue from small business product lines, gross margin improvements, and effective cost controls,” noted chief financial officer Mike Giannetto. “Looking ahead, economic conditions and exchange rates remain uncertain, and we have attempted to factor these risks into our financial guidance.”

Financial Guidance as of April 30, 2009:

Based on current and anticipated levels of demand, the Company expects the following financial results:

Revenue

 

   

For the quarter ending June 30, 2009, the Company expects revenue of approximately $123 million to $129 million.

 

   

For the full fiscal year ending June 30, 2009, the Company expects revenue of approximately $504 million to $510 million.

GAAP Fully-Diluted Earnings Per Share

 

   

For the quarter ending June 30, 2009, the Company expects GAAP fully-diluted earnings per share of approximately $0.24 to $0.28, which assumes 43.6 million weighted average shares outstanding.

 

   

For the full fiscal year ending June 30, 2009, the Company expects GAAP fully-diluted earnings per share of approximately $1.16 to $1.20, which assumes 44.2 million weighted average shares outstanding.

 

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Non-GAAP Adjusted Net Income Per Fully-Diluted Share

 

   

For the quarter ending June 30, 2009, the Company expects non-GAAP adjusted net income per fully diluted share of approximately $0.35 to $0.39, which assumes a non-GAAP fully diluted weighted average share count of approximately 44.1 million shares, and share-based compensation expense of approximately $4.8 million.

 

   

For the full fiscal year ending June 30, 2009, the Company expects non-GAAP adjusted net income per fully diluted share of approximately $1.61 to $1.65, which assumes a non-GAAP fully diluted weighted average share count of approximately 44.6 million shares, and share-based compensation expense of approximately $20.2 million.

Capital Expenditures

 

   

For the quarter ending June 30, 2009, the Company expects to make capital expenditures of approximately $15 million to $20 million.

 

   

For the full fiscal year ending June 30, 2009, the Company expects to make capital expenditures of approximately $75 million to $80 million.

The foregoing guidance supersedes any guidance previously issued by the Company. All such previous guidance should no longer be relied upon.

At approximately 4:20 p.m. (EDT) on April 30, 2009, VistaPrint will post, on the investor relations section of www.vistaprint.com, a link to a pre-recorded audio visual end-of-quarter presentation along with a downloadable transcript of the prepared remarks that accompany that presentation. At 5:00 p.m. (EDT) there will be a Web cast of a live Q&A session with VistaPrint management. Links to this Q&A session will also be posted on the investor relations section of the Company’s Web site. A replay of the Q&A session will be available on the Company’s Web site following the call on April 30, 2009.

 

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About non-GAAP financial measures

To supplement VistaPrint’s consolidated financial statements presented in accordance with U.S. generally accepted accounting principles, or GAAP, VistaPrint has used the following measures defined as non-GAAP financial measures by the SEC: non-GAAP adjusted net income and non-GAAP adjusted net income per diluted share. The item excluded from the non-GAAP measurements is share-based compensation expense, inclusive of income tax effects and share count impact. The presentation of non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the table captioned “Reconciliations of Non-GAAP Financial Measures” included at the end of this release. The table has more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliation between these financial measures.

Share-based compensation expense

VistaPrint adopted SFAS 123(R), Share-Based Payments, on July 1, 2005 and began expensing the fair value of share based compensation grants issued to employees and directors. Prior to that date, the Company had accounted for share option grants under the provisions of APB No. 25, Accounting for Stock Issued to Employees, and therefore had not recorded any compensation expense related to such grants.

VistaPrint’s management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenses that may not be indicative of our core business operating results. VistaPrint believes that both management and investors have historically benefited from referring to these non-GAAP financial measures in assessing VistaPrint’s performance and when planning, forecasting and analyzing future periods. These non-GAAP financial measures also have facilitated management’s internal comparisons to VistaPrint’s historical performance and our competitors’ operating results. Management believes that these benefits were particularly important during the period following adoption of SFAS

 

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123(R), as prospective equity grants resulted in incremental share-based compensation expenses not previously reported by VistaPrint prior to adoption of SFAS 123(R), which management believes were not indicative of core business operating results.

VistaPrint previously announced the Company’s intention to eliminate the use of non-GAAP financial measures in its financial reporting and guidance beginning with the first quarter of the fiscal year ending June 30, 2009, other than to facilitate non-GAAP comparisons during a transition period, because management believed that the reporting of non-GAAP measures would by that time no longer provide meaningful supplemental information to investors regarding the Company’s performance. However, based on subsequent investor feedback, management has concluded that many investors believe they would continue to benefit from referring to these non-GAAP financial measures in assessing VistaPrint’s performance and when forecasting and analyzing future periods. Therefore, the Company intends to continue to use non-GAAP financial measures in its financial reporting and guidance in fiscal year 2009 and will reevaluate their use in future periods. Until VistaPrint ceases to include non-GAAP financial measures in its reporting, it expects to compute non-GAAP financial measures using the same consistent method from quarter to quarter and year to year.

Management provides these non-GAAP financial measures as a courtesy to investors. However, to gain a more complete understanding of the Company’s financial performance, management does (and investors should) rely upon GAAP financial statements.

About VistaPrint

VistaPrint Limited (NASDAQ: VPRT) is the small business marketing company having served over 19 million customers world-wide. VistaPrint offers small businesses the ability to market their business with a broad range of brand identity and promotional products, marketing services and electronic marketing solutions. A global company, VistaPrint employs more than 1,600 people and operates 19 localized websites serving

 

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over 120 countries around the world. A broad range of marketing products and services are available online at www.vistaprint.com. VistaPrint’s products are satisfaction guaranteed.

VistaPrint and the VistaPrint logo are registered trademarks of VistaPrint. All other brand and product names appearing on this announcement may be trademarks or registered trademarks of their respective holders.

This press release contains statements about management’s future expectations, plans and prospects of our business that constitute forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995, including, but not limited to, statements concerning the expected growth and development of our business including the financial guidance set forth under the heading “Financial Guidance as of April 30, 2009,” our operating performance, our margins, our market position, our reinvestment program, and our ability to successfully attract and retain customers. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors including, but not limited to, our ability to attract customers and to retain customers and to do so in a cost-effective manner, willingness of purchasers of graphic design services and printed products to shop online, failure of our investments, unexpected increases in our use of funds, failure to increase our revenue and keep our expenses consistent with revenue, failures of our web sites or network infrastructure, failure to maintain the prices we charge for our products and services, the inability of our manufacturing operations to meet customer demand, exchange rate fluctuations, changes in or interpretation of tax laws and treaties, downturns in general economic conditions, and other factors that are discussed in our Annual Report on Form 10-K for the fiscal year ended June 30, 2008, our Form 10-Q for the quarter ended December 31, 2008, and other documents we periodically file with the SEC.

In addition, the statements in this press release represent our expectations and beliefs as of the date of this press release. We anticipate that subsequent events and developments may cause these expectations and beliefs to change. We specifically disclaim any

 

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obligation to update any forward-looking statements. These forward-looking statements should not be relied upon as representing our expectations or beliefs as of any date subsequent to the date of this press release.

Financial Tables to Follow

 

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VistaPrint Limited

Consolidated Balance Sheets

 

     March 31,
2009
    June 30,
2008
     (Unaudited)
     (In thousands, except share
and per share data)

Assets

    

Current assets:

    

Cash and cash equivalents

   $ 107,744     $ 103,145

Marketable securities

     6,910       26,598

Accounts receivable, net of allowances of $214 and $213, respectively

     7,629       6,105

Inventory

     3,192       2,548

Prepaid expenses and other current assets

     5,683       5,678
              

Total current assets

     131,158       144,074

Property, plant and equipment, net

     181,593       154,520

Software and web site development costs, net

     6,483       5,380

Deferred tax assets

     3,118       2,956

Other assets

     9,979       9,022
              

Total assets

   $ 332,331     $ 315,952
              

Liabilities and shareholders’ equity

    

Current liabilities:

    

Accounts payable

   $ 11,179     $ 8,486

Accrued expenses

     40,859       35,655

Deferred revenue

     2,353       1,893

Current portion of long-term debt

     8,625       3,304
              

Total current liabilities

     63,016       49,338

Deferred tax liability

     2,201       2,656

Other liabilities

     4,310       1,946

Long-term debt

     10,626       19,507

Shareholders’ equity:

    

Common shares, par value $0.001 per share, 500,000,000 shares authorized; 44,064,212 and 44,279,248 shares issued; and 42,258,611 and 44,279,248 shares outstanding, respectively

     44       44

Treasury shares, at cost, 1,805,601 and 0 shares, respectively

     (27,537 )     —  

Additional paid-in capital

     195,741       191,271

Retained earnings

     84,087       43,098

Accumulated other comprehensive income

     (157 )     8,092
              

Total shareholders’ equity

     252,178       242,505
              

Total liabilities and shareholders’ equity

   $ 332,331     $ 315,952
              


VistaPrint Limited

Consolidated Statements of Income

 

     Three Months Ended
March 31,
   Nine Months Ended
March 31,
     2009     2008    2009     2008
     (Unaudited)
     (in thousands, except share and per share data)

Revenue

   $ 127,523     $ 105,779    $ 380,658     $ 290,249

Cost of revenue (1)

     46,583       40,960      142,119       110,607

Technology and development expense (1)

     15,646       11,390      44,700       31,623

Marketing and selling expense (1)

     39,644       33,732      117,128       94,170

General and administrative expense (1)

     9,664       8,581      30,240       24,027
                             

Income from operations

     15,986       11,116      46,471       29,822

Interest income

     251       1,057      1,543       3,378

Other (expense) income, net

     (389 )     669      (1,755 )     766

Interest expense

     342       404      1,075       1,260
                             

Income before income taxes

     15,506       12,438      45,184       32,706

Income tax provision

     1,340       985      4,195       3,204
                             

Net income

   $ 14,166     $ 11,453    $ 40,989     $ 29,502
                             

Basic net income per share

   $ 0.34     $ 0.26    $ 0.95     $ 0.67
                             

Diluted net income per share

   $ 0.33     $ 0.25    $ 0.92     $ 0.64
                             

Weighted average common shares outstanding—basic

     42,183,100       44,062,407      43,290,985       43,815,062
                             

Weighted average common shares outstanding—diluted

     43,109,786       46,002,304      44,469,114       46,038,479
                             

 

(1) Share-based compensation cost is allocated as follows:

 

     Three Months Ended
March 31,
   Nine Months Ended
March 31,
     2009    2008    2009    2008
     (Unaudited)
     (in thousands)

Cost of revenue

   $ 183    $ 248    $ 565    $ 593

Technology and development expense

     1,247      1,005      3,707      2,865

Marketing and selling expense

     1,010      879      3,032      2,685

General and administrative expense

     2,156      1,392      7,575      4,110
                           
   $ 4,596    $ 3,524    $ 14,879    $ 10,253
                           


VistaPrint Limited

Reconciliations of Non-GAAP Financial Measures

 

     Three Months Ended
March 31,
    Nine Months Ended
March 31,
 
     2009     2008     2009     2008  
     (Unaudited)     (Unaudited)  
     (in thousands, except
per share data)
    (in thousands, except
per share data)
 

Non-GAAP adjusted net income reconciliation:

    

Net income

   $ 14,166     $ 11,453     $ 40,989     $ 29,502  

Add back:

        

Share-based compensation expense, inclusive of income tax effects

     4,761 (a)     3,652 (b)     15,413 (c)     10,627 (d)
                                

Non-GAAP adjusted net income

   $ 18,927     $ 15,105     $ 56,402     $ 40,129  
                                

Non-GAAP adjusted net income per diluted share reconciliation:

        

Net income per diluted share

   $ 0.33     $ 0.25     $ 0.92     $ 0.64  

Add back:

        

Share-based compensation expense, inclusive of income tax effects

     0.11       0.07       0.34       0.21  
                                

Non-GAAP adjusted net income per diluted share

   $ 0.44     $ 0.32     $ 1.26     $ 0.85  
                                

 

(a) Includes share-based compensation charges of $4,596 and the income tax effects related to those charges of $165
(b) Includes share-based compensation charges of $3,524 and the income tax effects related to those charges of $128
(c) Includes share-based compensation charges of $14,879 and the income tax effects related to those charges of $534
(d) Includes share-based compensation charges of $10,253 and the income tax effects related to those charges of $374


VistaPrint Limited

Consolidated Statements of Cash Flows

 

     Nine Months Ended
March 31,
 
     2009     2008  
     (Unaudited)  
     (in thousands)  

Operating activities

    

Net income

   $ 40,989     $ 29,502  

Adjustments to reconcile net income to net cash provided by operating activities:

    

Depreciation and amortization

     25,991       17,769  

Loss on disposal of long lived assets

     1,331       112  

Share-based compensation expense

     14,879       10,253  

Tax benefits derived from share-based compensation awards

     (4,408 )     (185 )

Changes in operating assets and liabilities:

    

Accounts receivable

     (1,769 )     (1,625 )

Inventory

     (844 )     (860 )

Prepaid expenses and other assets

     (1,484 )     (4,231 )

Accounts payable

     2,942       2,219  

Accrued expenses and other current liabilities

     14,625       16,109  
                

Net cash provided by operating activities

     92,252       69,063  

Investing activities

    

Purchases of property, plant and equipment

     (59,575 )     (48,889 )

Purchases of marketable securities

     (6,078 )     (45,761 )

Sales of marketable securities

     25,037       55,942  

Purchase of intangible assets

     —         (1,250 )

Capitalization of software and website development costs

     (5,319 )     (3,999 )
                

Net cash used in investing activities

     (45,935 )     (43,957 )

Financing activities

    

Repayments of long-term debt

     (2,423 )     (2,425 )

Payment of withholding taxes in connection with settlement of RSUs

     (1,832 )     (2,228 )

Repurchase of common shares

     (45,518 )     —    

Tax benefits derived from share-based compensation awards

     4,408       185  

Proceeds from issuance of common shares

     4,757       7,364  
                

Net cash (used in) provided by financing activities

     (40,608 )     2,896  

Effect of exchange rate changes on cash

     (1,110 )     1,110  
                

Net increase in cash and cash equivalents

     4,599       29,112  

Cash and cash equivalents at beginning of period

     103,145       69,464  
                

Cash and cash equivalents at end of period

   $ 107,744     $ 98,576  
                

Free cash flow reconciliation:

    

Net cash provided by operating activities

   $ 92,252     $ 69,063  

Purchases of property, plant and equipment

     (59,575 )     (48,889 )

Capitalization of software and website development costs

     (5,319 )     (3,999 )
                

Total free cash flow

   $ 27,358     $ 16,175