Vistaprint N.V., a leading online provider of professional marketing products and services to micro businesses and the home, today announced financial results for the three month period ended September 30, 2011, the first quarter of its 2012 fiscal year.
"First quarter revenue and earnings met our expectations, and our full year is off to a good start," said Robert Keane, president and chief executive officer. "This was a quarter of solid performance against our plan. Four months into our multi-year plan, we remain confident that we are making the right decisions in funding our long-term strategy for growth and competitive advantage. This quarter we made disciplined investments designed to better position us to capture what we believe to be a large opportunity, and build a strong company for many years to come."
-- Revenue for the first quarter of fiscal year 2012 grew to $212.4 million, a 25 percent increase over revenue of $170.5 million reported in the same quarter a year ago. Excluding the estimated impact from currency exchange rate fluctuations, total revenue grew 20 percent from the same quarter a year ago.
-- Gross margin (revenue minus the cost of revenue as a percent of total revenue) in the first quarter was 63.2 percent, compared to 63.1 percent in the same quarter a year ago.
-- Operating income in the first quarter was $9.7 million, or 4.6 percent of revenue, and reflected a 21 percent decrease compared to operating income of $12.3 million, or 7.2 percent of revenue in the same quarter a year ago.
-- GAAP net income for the first quarter was $8.2 million, or 3.8 percent of revenue, representing a 24 percent decrease compared to $10.8 million, or 6.3 percent of revenue in the same quarter a year ago.
-- GAAP net income per diluted share for the first quarter was $0.19, versus $0.24 in the same quarter a year ago.
-- Non-GAAP adjusted net income for the first quarter, which excludes share-based compensation expense and its related tax effect, was $13.0 million, or 6.1 percent of revenue, representing a 20 percent decrease compared to non-GAAP adjusted net income of $16.3 million, or 9.6 percent of revenue, in the same quarter a year ago.
-- Non-GAAP adjusted net income per diluted share for the first quarter, which excludes share-based compensation expense and its related tax effect, was $0.31, versus $0.36 in the same quarter a year ago.
-- Capital expenditures in the first quarter were $11.0 million or 5.2 percent of revenue.
-- During the first quarter, the company generated $30.5 million of cash from operations and $17.8 million in free cash flow, defined as cash from operations less purchases of property, plant and equipment, purchases of intangible assets, and capitalization of software and website development costs.
-- The company had $161.1 million in cash and cash equivalents as of September 30, 2011.
-- During the first quarter, the company purchased 3.1 million of its ordinary shares for $91.1 million, inclusive of transaction costs, at an average per-share cost of $29.62, as part of the share repurchase program authorized by the Supervisory Board in November 2010.
-- Subsequent to the end of our first quarter and through October 21, 2011, the company purchased an additional 1.8 million shares for $50.4 million, inclusive of transaction costs, at an average per-share cost of $28.68, pursuant to a new program that our Supervisory Board authorized in August 2011.
-- Vistaprint acquired approximately 1.9 million new customers in the first fiscal quarter ended September 30, 2011.
-- On a trailing twelve month basis, unique active customer count was 11.9 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.
-- Total order volume in the first quarter of fiscal 2012 was approximately 5.9 million, reflecting an increase of approximately 18 percent over total orders of approximately 5.0 million in the same quarter a year ago.
-- Average order value in the first quarter including revenue from shipping and processing was $36.38, compared to $34.69 in the same quarter a year ago.
-- Advertising and commissions expense in the first quarter was $51.8 million, or 24.4 percent of revenue compared to $36.1 million, or 21.2 percent of revenue in the same quarter a year ago.
-- Revenue from customers in North America was $118.7 million, or 56 percent of total revenue in the first quarter. This represents 17 percent growth year over year in reported terms and in constant currency.
-- Revenue from customers in Europe was $80.0 million, or 38 percent of total revenue in the first quarter. This represents 31 percent growth year over year in reported terms and 21 percent growth in constant currency.
-- Revenue from customers in Asia Pacific was $13.7 million, or 6 percent of total revenue in the first quarter. This represents 67 percent growth year over year in reported terms and 45 percent growth in constant currency.
-- During the quarter, Staples and Vistaprint started working together to bring a full suite of high-quality printed products to Staples customers, allowing them to create unique marketing materials and develop customized business cards and stationery. This new strategic partnership provides the opportunity to extend our reach on staples.com and in approximately 1,600 Staples retail locations across the U.S.
-- On October 21, 2011, the company entered into a $250.0 million senior unsecured revolving credit facility with a maturity date of October 21, 2016.
-- On October 24, 2011, Vistaprint entered into a definitive agreement to acquire Albumprinter Holding B.V., a privately held Dutch photo book company for EURO60.0 million payable at closing and up to an additional EURO5.0 million subject to a performance based earn-out.
Ernst Teunissen, executive vice president and chief financial officer, said, "After our first quarter of fiscal 2012, we remain confident we will deliver against our operational expectations for the full year. We are updating our guidance for fiscal 2012 to reflect a few non-operational items. First, currency rates have moved unfavorably since we gave guidance in July 2011, which primarily impacts our revenue guidance in U.S. dollars. Second, we have repurchased a significant number of Vistaprint shares since July, which will benefit our earnings per share relative to our prior expectations. And finally, the costs associated with our recently announced revolving credit facility are now included in our guidance."
Financial Guidance as of October 27, 2011:
Vistaprint's financial guidance is as of October 27, 2011 and does not include estimates for our pending acquisition of Albumprinter, which has not yet closed. Based on current and anticipated levels of demand and recent foreign currency rates, the company expects the following financial results:
-- For the full fiscal year ending June 30, 2012, the company expects revenue of approximately $960 million to $1,010 million, or 18 percent to 24 percent growth year over year in reported terms and approximately 18 percent to 24 percent in constant-currency terms. Constant-currency growth expectations assume a recent 30-day currency exchange rate for all currencies.
-- For the second fiscal quarter ending December 31, 2011, the company expects revenue of approximately $270 million to $290 million, or 15 percent to 24 percent growth year over year in reported terms and approximately 15 percent to 24 percent in constant-currency terms.
GAAP Diluted Earnings Per Share
-- For the full fiscal year ending June 30, 2012, the company expects GAAP diluted earnings per share of approximately $1.19 to $1.29, which assumes 40.8 million weighted average shares outstanding.
-- For the quarter ending December 31, 2011, the company expects GAAP diluted earnings per share of approximately $0.55 to $0.65, which assumes 40.6 million weighted average shares outstanding.
Non-GAAP Adjusted Net Income Per Diluted Share
-- For the full fiscal year ending June 30, 2012, the company expects non-GAAP adjusted net income per diluted share of approximately $1.71 to $1.81, which excludes expected share-based compensation expense and its related tax effect of approximately $21.7 million, and assumes a non-GAAP diluted weighted average share count of approximately 41.2 million shares.
-- For the quarter ending December 31, 2011, the company expects non-GAAP adjusted net income per diluted share of approximately $0.68 to $0.78, which excludes expected share-based compensation expense and its related tax effect of approximately $5.5 million, and assumes a non-GAAP diluted weighted average share count of approximately 41.1 million shares.
For the full fiscal year ending June 30, 2012, the company expects to make capital expenditures of approximately $60 million to $75 million. Planned capital investments are designed to support the planned growth of the business.
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 October 27, 2011, 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 5:15 p.m. the company will host a live Q&A conference call with management, which will be available via web cast on the Investor Relations section of www.vistaprint.com and via dial-in at (866) 362-4666, access code 91715638. A replay of the Q&A session will be available on the company's Web site following the call on October 27, 2011.
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 Securities and Exchange Commission, or SEC, rules: non-GAAP adjusted net income, non-GAAP adjusted net income per diluted share, free cash flow, and constant-currency revenue growth. The items excluded from the non-GAAP adjusted net income measurements are share-based compensation expense and its related tax effect. Free cash flow is defined as net cash provided by operating activities less purchases of property, plant and equipment, purchases of intangible assets, and capitalization of software and website development costs. Constant-currency revenue growth is estimated by translating all non-U.S. dollar denominated revenue generated in the current period using the prior year period's average exchange rate for each currency to the U.S. dollar.
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 tables captioned "Reconciliations of Non-GAAP Financial Measures" included at the end of this release. The tables have 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.
Vistaprint's management believes that these non-GAAP financial measures provide meaningful supplemental information in assessing our performance and when 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 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 statements of operations and cash flow.