Vistaprint Reports Double-Digit Growth, Releases Five-Year Plan

VENLO, NETHERLANDS—July 28, 2011—Vistaprint N.V., a leading online provider of professional marketing products and services to micro businesses and the home, announced financial results for the fourth quarter and fiscal year ended June 30, 2011.

Fourth quarter 2011 results:

• Revenue grew 27 percent year over year to $208.8 million.
• Operating income was $17.0 million, a 22 percent increase.
• GAAP net income totaled $14.4 million, a 24 percent increase.

Fiscal year 2011 results:

• Revenue grew 22 percent year over year to $817.0 million
• Operating income was $93.1 million, a 21 percent increase.
• GAAP net income was $82.1 million, a 21 percent increase.

“We are pleased to have just delivered another quarter and another fiscal year of healthy revenue and earnings per share growth,” said Robert Keane, president and chief executive officer. “We achieved solid financial and operational results, with record new customer additions, increased revenue from existing customers, continued geographic expansion, and healthy growth across our businesses. We also delivered outstanding free cash flow growth, which illustrates the power of our operating model during a year in which we made fewer capital expenditures. We also began to execute on several growth initiatives that we believe will better position us to capture more of our large market opportunity and drive competitive advantage.”

Financial Metrics:

Revenue for the fourth quarter of fiscal year 2011 grew to $208.8 million, a 27 percent increase over revenue of $164.3 million reported in the same quarter a year ago. For the full fiscal year, revenue grew to $817.0 million, a 22 percent increase over revenue of $670.0 million in fiscal year 2010. Excluding the estimated impact from currency exchange rate fluctuations, total revenue grew 20 percent year over year in the fourth quarter and 22 percent for the full year.

Gross margin (revenue minus the cost of revenue as a percent of total revenue) in the fourth quarter was 63.9 percent, compared to 63.6 percent in the same quarter a year ago. For the full fiscal year, gross margin was 64.8 percent, compared to 64.2 percent in fiscal 2010.

Operating income in the fourth quarter was $17.0 million, or 8.1 percent of revenue, and reflected a 22 percent increase compared to operating income of $13.9 million, or 8.5 percent of revenue, in the same quarter a year ago. For the full fiscal year, operating income was $93.1 million, or 11.4 percent of revenue, a 21 percent increase over operating income of $76.8 million, or 11.5 percent of revenue, in the prior fiscal year.

GAAP net income for the fourth quarter was $14.4 million, or 6.9 percent of revenue, representing a 24 percent increase compared to $11.7 million, or 7.1 percent of revenue in the same quarter a year ago. For the full fiscal year, GAAP net income was $82.1 million, or 10.0 percent of revenue, a 21 percent increase over GAAP net income of $67.7 million, or 10.1 percent of revenue, in the prior fiscal year.

Non-GAAP adjusted net income for the fourth quarter, which excludes share-based compensation expense and its related tax effect, was $19.5 million, or 9.4 percent of revenue, representing a 13 percent increase over non-GAAP adjusted net income of $17.3 million, or 10.5 percent of revenue, in the same quarter a year ago. For the full fiscal year, non-GAAP adjusted net income, which excludes share-based compensation expense and its related tax effect, was $104.5 million, or 12.8 percent of revenue, a 15 percent increase over non-GAAP adjusted net income of $90.9 million, or 13.6 percent of revenue, in the prior fiscal year.

Capital expenditures in the fourth quarter were $8.2 million or 3.9 percent of revenue. During the full fiscal year, capital expenditures were $37.4 million or 4.6 percent of revenue.

During the fourth quarter, the company generated $36.3 million of cash from operations and $26.4 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. During the full fiscal year, the company generated $162.6 million of cash from operations and $118.7 million in free cash flow.

Operating Highlights:

Vistaprint acquired approximately 1.8 million new customers in the fourth fiscal quarter ended June 30, 2011. For the full fiscal year 2011, the number of new customer acquisitions totaled approximately 7.4 million.

Repeat customers generated approximately 68 percent of total quarterly bookings in the fourth quarter, an increase from 67 percent in the same quarter a year ago.

Total order volume in the fourth quarter of fiscal 2011 was approximately 5.6 million, reflecting an increase of approximately 17 percent over total orders of approximately 4.8 million in the same quarter a year ago.

Advertising and commissions expense in the fourth quarter was $47.0 million, or 22.5 percent of revenue, compared to $35.1 million, or 21.4 percent of revenue in the same quarter a year ago.

The U.S. market contributed 54 percent of total revenue in the fourth fiscal quarter, down from 59 percent in the same quarter a year ago, representing a 17 percent increase in revenue year over year. For the full fiscal year, the U.S. market contributed 53 percent of total revenue, down from 55 percent of total revenue in fiscal 2010.

Non-U.S. markets contributed 46 percent of total revenue in the fourth quarter, up from 41 percent in the same quarter a year ago, representing a 41 percent increase in revenue year over year and 25 percent in constant currency. For the full fiscal year, non-U.S. markets contributed 47 percent of total revenue, up from 45 percent of total revenue in fiscal 2010.

North American, European and Asia-Pacific revenue contributions in the fourth quarter of fiscal year 2011 were 57, 37, and 6 percent of total revenue, respectively. For the full fiscal year, North American, European and Asia-Pacific revenue contributions were 56, 39, and 5 percent of total revenue, respectively.

Average order value in the fourth quarter including revenue from shipping and processing was $37.72, compared to $34.56 in the same quarter a year ago.

Website sessions in the fourth quarter were 71.4 million, an 8 percent decrease over 77.8 million in the same quarter a year ago.

Conversion rates were 7.8 percent in the fourth quarter of fiscal 2011, compared to 6.2 percent in the same quarter a year ago.

Vistaprint also announced today a new investment approach and five-year financial targets to support its long-term growth strategy.

Ernst Teunissen, executive vice president and chief financial officer, said, “Vistaprint is committed to driving strong long-term shareholder returns. In light of our market opportunity and successful track record of execution, we have adopted an investment approach that we believe will support our strategy and drive stronger returns and robust revenue and earnings growth over the next several years.

“Our five-year goal is to achieve 20 percent or better constant-currency compound annual growth rates for both revenue and earnings. We expect to make deep investments earlier in the five-year period, starting in fiscal 2012. Therefore, in fiscal 2012, these planned investments will reduce earnings, but we anticipate revenue growth of 20 percent to 26 percent as compared to 22 percent for fiscal 2011.”

Financial Guidance as of July 28, 2011:

Based on current and anticipated levels of demand and recent foreign currency rates, the company expects the following financial results:

Revenue

For the full fiscal year ending June 30, 2012, the company expects revenue of approximately $980 million to $1,030 million, or 20 percent to 26 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 first fiscal quarter ending Sept. 30, 2011, the company expects revenue of approximately $207 million to $215 million, or 21 percent to 26 percent growth year over year in reported terms and approximately 16 percent to 21 percent in constant-currency terms.

Capital Expenditures

For the full fiscal year ending June 30, 2012, the company expects to make capital expenditures of approximately $75 million to $95 million. Planned capital investments are designed to support the planned growth of the business.

About Vistaprint
Vistaprint N.V. (Nasdaq:VPRT) empowers more than 11 million micro businesses and consumers annually with affordable, professional options to make an impression. With a unique business model supported by proprietary technologies, high-volume production facilities, and direct marketing expertise, Vistaprint offers a wide variety of products and services that micro businesses can use to expand their business. A global company, Vistaprint employs over 2,800 people, operates 24 localized websites and ships to more than 130 countries. Vistaprint’s broad range of products and services are easy to access online, 24 hours a day.
Source: Vistaprint.