Vistaprint N.V., the company that provides high-impact personalized products and services for small businesses and the home, today announced financial results for the three month period ended March 31, 2010, the third quarter of its 2010 fiscal year.

"Vistaprint delivered strong third quarter revenue in line with our guidance," said Robert Keane, president and chief executive officer. "Our earnings performance exceeded our expectations due to strong gross margins and lower than anticipated expenses during the quarter. We continued to execute toward our accelerated investment plans for the fiscal year, although the timing of some of our investments has shifted into the fourth quarter. We are pleased with our results and believe that we remain well positioned to continue to drive competitive advantage and deliver strong financial results for years to come."

Financial Metrics:
- Revenue for the third quarter of fiscal year 2010 grew to $166.0 million, a 30 percent increase over revenue of $127.5 million reported in the same quarter a year ago. Excluding the estimated impact from currency exchange rate fluctuations, total revenue grew 25 percent from the third quarter a year ago. Excluding the termination of membership programs which generated 3.9 percent of total revenue in the third quarter of 2009, but 0 percent of total revenue in the third quarter of 2010, constant currency revenue growth was 30 percent year over year.
- Gross margin (revenue minus the cost of revenue as a percent of total revenue) in the third quarter was 64.1 percent, compared to 63.5 percent in the same quarter a year ago.
- Operating income in the third quarter was $17.8 million, or 10.7 percent of revenue, and reflected an 11 percent increase compared to $16.0 million, or 12.5 percent of revenue in the same quarter a year ago.
- GAAP net income for the third quarter was $16.2 million, or 9.7 percent of revenue, representing a 14 percent increase compared to $14.2 million, or 11.1 percent of revenue in the same quarter a year ago.
- GAAP net income per diluted share for the third quarter was $0.35, versus $0.33 in the same quarter a year ago.
- Non-GAAP adjusted net income for the third quarter, which excludes share-based compensation expense and its related tax effect, was $21.5 million, or 12.9 percent of revenue, representing a 14 percent increase compared to $18.9 million, or 14.8 percent of revenue in the same quarter a year ago.
- Non-GAAP adjusted net income per diluted share for the third quarter, which excludes share-based compensation expense and its related tax effect, was $0.46, versus $0.44 in the same quarter a year ago.
- Capital expenditures in the third quarter were $22.9 million, or 13.8 percent of revenue.
- During the third quarter, the company generated $32.8 million in cash from operations and $8.3 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 $172.3 million in cash, cash equivalents, and short-term marketable securities as of March 31, 2010.

Operating Metrics:
- Vistaprint acquired approximately 1.6 million new customers in the third fiscal quarter ended March 31, 2010.
- Repeat customers generated approximately 67 percent of total quarterly bookings in the third quarter, compared with 66 percent in the same quarter a year ago.
- Average daily order volume in the third quarter of fiscal 2010 was approximately 54,000, reflecting an increase of approximately 23 percent over an average of approximately 44,000 orders per day in the same quarter a year ago.
- Advertising and commissions expense was $33.2 million, or 20.0 percent of revenue in the third quarter, compared to $24.4 million, or 19.2 percent of revenue in the same quarter a year ago.
- Non-U.S. markets contributed 45 percent of total revenue in the third quarter, up from 38 percent in the same quarter a year ago.
- Average order value in the third quarter, including revenue from shipping and processing, was $34.79, up from $31.06 in the same quarter a year ago.
- Web site sessions in the third quarter were 81.9 million, a 24 percent increase over 65.8 million in the same quarter a year ago.
- Conversion rates were 5.9 percent in the third quarter of fiscal 2010, compared to 6.0 percent in the same quarter a year ago.

During the quarter, Vistaprint broadened its product offering with ladies' t-shirts, luggage tags, folded business cards, consumer websites, and recycled paper options for business cards and postcards. Additionally, the company launched the Vistaprint Visa(R) Business credit card, a joint offering in partnership with U.S. Bank that enables eligible Vistaprint customers to personalize credit card designs to match graphic images used in their marketing materials.

"With just one quarter left in fiscal 2010, we remain confident in our ability to achieve our targets," said Mike Giannetto, chief financial officer. "Our plan to accelerate long-term growth investments is still on track for the remainder of the fiscal year, and in fact, we expect to be able to make additional investments in the fourth quarter and still meet our targets. As we have done in prior quarters, we are updating our guidance to reflect recent currency movements, which have historically impacted revenue more than earnings due to some natural hedging in our operating cost structure. Therefore, we are narrowing our full-year revenue guidance toward the low-end of the previously stated range, and narrowing our EPS guidance around the mid-point of the previously stated range."

Financial Guidance as of April 29, 2010:
Based on current and anticipated levels of demand, the company expects the following financial results:

Revenue
- For the fourth quarter of fiscal year 2010, ending June 30, 2010, the company expects revenue of approximately $169 million to $174 million.
- For the full fiscal year ending June 30, 2010, the company expects revenue of approximately $675 million to $680 million.

GAAP Diluted Earnings Per Share
- For the fourth quarter of fiscal year 2010, ending June 30, 2010, the company expects GAAP diluted earnings per share of approximately $0.24 to $0.27, which assumes 45.8 million weighted average shares outstanding.
- For the full fiscal year ending June 30, 2010, the company expects GAAP diluted earnings per share of approximately $1.47 to $1.50, which assumes 45.4 million weighted average shares outstanding.

Non-GAAP Adjusted Net Income Per Diluted Share
- For the fourth quarter of fiscal year 2010, ending June 30, 2010, the company expects non-GAAP adjusted net income per diluted share of approximately $0.35 to $0.38, which excludes expected share-based compensation expense and its related tax effect of approximately $5.4 million, and assumes a non-GAAP diluted weighted average share count of approximately 46.3 million shares.
- For the full fiscal year ending June 30, 2010, the company expects non-GAAP adjusted net income per diluted share of approximately $1.95 to $1.98, which excludes expected share-based compensation expense and its related tax effect of approximately $22.9 million, and assumes a non-GAAP diluted weighted average share count of approximately 46.0 million shares.

Capital Expenditures
For the full fiscal year ending June 30, 2010, the company expects to make capital expenditures of approximately $95 million to $100 million. Planned capital investments include the expansion of the company's Canadian manufacturing facility which is expected to be completed toward the end of fiscal year 2010, new manufacturing equipment to support the growth of the business, and continued investment in a new manufacturing facility in Australia which is expected to be operational in the first quarter of fiscal year 2011.

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