UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________________
Form 8-K
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Item 2.02. Results of Operations and Financial Condition
On October 30, 2019, Cimpress N.V. posted on its web site its Q1 Fiscal Year 2020 Quarterly Earnings Document announcing and discussing its financial results for the first quarter ended September 30, 2019. The full text of the earnings document is furnished as Exhibit 99.1 to this report.
The information in this Item 2.02 and the exhibit to this report are not "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor are they incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as expressly set forth by specific reference in such a filing.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
Exhibit | ||
No. | Description | |
Q1 Fiscal Year 2020 Quarterly Earnings Document dated October 30, 2019 | ||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
October 30, 2019 Cimpress N.V.
By: | /s/ Sean E. Quinn | |
Sean E. Quinn | ||
Executive Vice President and Chief Financial Officer | ||
TABLE OF CONTENTS Page IMPORTANT NOTES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 LETTER FROM CEO ROBERT KEANE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 SUMMARY CONSOLIDATED RESULTS: 3-YEAR TREND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 SUMMARY CONSOLIDATED RESULTS: QUARTERLY TREND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 INCOME STATEMENT HIGHLIGHTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 CASH FLOW AND RETURN ON INVESTED CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 DEBT AND SHARE REPURCHASES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 SEGMENT RESULTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 VISTAPRINT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 UPLOAD AND PRINT: PRINTBROTHERS AND THE PRINT GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 NATIONAL PEN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 ALL OTHER BUSINESSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 CENTRAL AND CORPORATE COSTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 CURRENCY IMPACTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 HOUSEKEEPING ITEMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 BALANCE SHEET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 INCOME STATEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 CASH FLOW STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 ABOUT NON-GAAP MEASURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 NON-GAAP RECONCILIATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 ABOUT CIMPRESS, SAFE HARBOR STATEMENT AND CONTACT INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . 34 Page 2 of 34
REPORTING CHANGES As a supplement to this earnings document, we have also published on ir.cimpress.com a guide to reporting changes we have made to align to recent organizational changes in the business, and to simplify and strengthen the clarity of this document. These changes have been recast on a quarterly basis for the past three years, so that you can continue to see clear trends in our businesses. CIMPRESS' UPPERMOST FINANCIAL OBJECTIVE Our uppermost financial objective is to maximize our intrinsic value per share (“IVPS”). We define IVPS as (a) the unlevered free cash flow per diluted share that, in our best judgment, will occur between now and the long-term future, appropriately discounted to reflect our cost of capital, minus (b) net debt per diluted share. We define unlevered free cash flow as adjusted free cash flow plus cash interest expense related to borrowing. We endeavor to make all financial decisions in service of this priority. As such, we often make decisions that could be considered non-optimal were they to be evaluated based on other criteria such as (but not limited to) near- and mid-term operating income, net income, EPS, adjusted EBITDA, and cash flow. IVPS is inherently long term in nature. Thus an explicit outcome of this is that we accept fluctuations in our financial metrics as we make investments that we believe will deliver attractive long-term returns on investment. OUR STRATEGY Cimpress invests in and builds customer-focused, entrepreneurial, mass customization businesses for the long term, which we manage in a decentralized, autonomous manner. We drive competitive advantage across Cimpress through a select few shared strategic capabilities that have the greatest potential to create company-wide value. We limit all other central activities to only those which absolutely must be performed centrally. Page 3 of 34
LETTER FROM ROBERT Dear Investor, In our annual investor letter and August investor day we described how over the past five years we failed to achieve our objective of growing our intrinsic value per share at a rate that is comfortably above our WACC. However, we also expressed optimism that the decentralization we began two years ago, designed to reinvigorate an entrepreneurial culture, was starting to work as evidenced by accelerating speed, customer focus, innovation and the strong cash flow growth that we delivered in the second half of FY2019. To build on that momentum in FY2020, we committed to continuing our focus on execution across Cimpress. I am happy to report that the operational and financial success that we saw in the second half of FY2019 continued during the first quarter of FY2020. Highlights from the quarter are outlined in the commentary throughout this document. During the first quarter, we also repurchased 1,963,629 Cimpress shares for $232.3 million at an average price per share of $118.29. Furthermore, as of October 25, in our second quarter we repurchased an additional 585,106 Cimpress shares for $75.6 million at an average price per share of $129.14. Even though we are not yet executing to our full potential, it is helpful to take a step back and look at what we have accomplished. Over the past two years, our leverage ratio has declined from 3.39 times trailing twelve month EBITDA as of September 30, 2017 to 3.00 as of September 30, 2019, despite undergoing multiple restructurings and investing over $250 million for growth-related organic investments, $392 million for acquisitions and related earn-out payments net of partial equity sales and $342 million for share repurchases. Our trailing-twelve-month adjusted return on invested capital has improved significantly over this time frame to 22%. These results speak volumes about the high quality of our team members and the strong underlying cash flow characteristics of Cimpress’ businesses. Sincerely, Robert S. Keane Founder, Chairman & CEO Please see non-GAAP reconciliations at the end of this document. Page 4 of 34
SUMMARY CONSOLIDATED RESULTS: THREE-YEAR TREND $ in thousands, except percentages REVENUE BY REPORTABLE SEGMENT1, TOTAL REVENUE AND INCOME FROM OPERATIONS: Q1 FY2018 Q1 FY2019 Q1 FY2020 Vistaprint $ 326,286 $ 345,320 $ 343,171 PrintBrothers 91,874 101,389 109,290 The Print Group 68,612 71,000 72,258 National Pen 59,717 65,971 70,163 All Other Businesses 18,704 7,715 42,276 Inter-segment eliminations (1,909) (2,414) (3,199) Total revenue $ 563,284 $ 588,981 $ 633,959 Reported revenue growth 27% 5 % 8% Organic constant currency revenue growth 12% 8 % 4% Income (loss) from operations $ 46,613 $ (5,988) $ 25,379 Income (loss) from operations margin 8% (1)% 4% EBITDA (LOSS) BY REPORTABLE SEGMENT ("SEGMENT EBITDA") AND ADJUSTED EBITDA1: Q1 FY2018 Q1 FY2019 Q1 FY2020 Vistaprint $ 41,791 $ 59,994 $ 80,580 PrintBrothers 8,468 10,571 10,777 The Print Group 12,223 11,846 13,634 National Pen 2,706 (16,468) (9,850) All Other Businesses (330) (4,722) 1,717 Total segment EBITDA $ 64,858 $ 61,221 $ 96,858 Central and corporate costs (23,080) (25,219) (27,429) Unallocated share-based compensation (2,072) (4,068) 499 Exclude: share-based compensation included in segment EBITDA 6,769 8,917 4,750 Include: Realized gains (losses) on certain currency derivatives not included in segment EBITDA (634) 1,607 4,838 Adjusted EBITDA $ 45,841 $ 42,457 $ 79,516 Adjusted EBITDA margin 8% 7 % 13% Adjusted EBITDA year-over-year growth 31% (7)% 87% 1 In Q1 FY20, we made two changes to our segment reporting to align to recent organizational changes and to simplify our reporting. The changes have been recast back to Q1 FY2017, so all data in the charts above is comparable. Please see the guide to reporting changes published on ir.cimpress.com for details. CASH FLOW AND OTHER METRICS: Q1 FY2018 Q1 FY2019 Q1 FY2020 Net cash provided by operating activities $ 16,379 $ 22,220 $ 62,905 Net cash provided by (used in) investing activities2 62,298 (49,568) (29,363) Net cash (used in) provided by financing activities (75,459) 31,643 (33,005) Adjusted free cash flow (13,036) (10,061) 36,241 Cash interest related to borrowing 6,519 5,700 9,384 2 In Q1 of FY2018, Cimpress divested the Albumprinter business for $93,071, net of transactions costs and cash divested. Pro-forma net cash (used in) investing activities excluding this divestiture was $(30,773) in Q1 FY2018. Please see non-GAAP reconciliations at the end of this document. Page 5 of 34
SUMMARY CONSOLIDATED RESULTS: THREE-YEAR TREND (CONTINUED) $ in thousands, except where noted COMPONENTS OF ADJUSTED FREE CASH FLOW: Q1 FY2018 Q1 FY2019 Q1 FY2020 Adjusted EBITDA $ 45,841 $ 42,457 $ 79,516 Cash restructuring payments (4,082) (1,231) (2,262) Cash taxes (5,369) (5,449) (4,472) Other changes in net working capital (ex. earn-out payments) and other reconciling items (13,492) (7,857) (493) Purchases of property, plant and equipment (20,457) (21,026) (14,193) Purchases of intangible assets not related to acquisitions (24) (22) — Capitalization of software and website development costs (8,934) (11,233) (12,471) Adjusted free cash flow before cash interest related to borrowing $ (6,517) $ (4,361) $ 45,625 Cash interest related to borrowing (6,519) (5,700) (9,384) Adjusted free cash flow $ (13,036) $ (10,061) $ 36,241 Q1 FY2020 COMPONENTS OF ADJUSTED FREE CASH FLOW ($M) $79.5 ($2.3) ($4.5) ($0.5) $45.6 ($14.2) $36.2 ($12.5) ($9.4) DA ents xes ems ures are ing ing flow EBIT aym sh ta er it ndit softw orrow orrow ash sted ng p Ca & oth expe n of to b to b ree c Adju cturi ges ital atio ated ated ed f stru han Cap italiz t rel t rel djust Re C c Cap teres teres A r NW re in h in Othe befo Cas flow cash free sted Adju Please see non-GAAP reconciliations at the end of this document. Page 6 of 34
SUMMARY CONSOLIDATED RESULTS: QUARTERLY TREND $ in millions, except percentages and share data Revenue & Reported Revenue Growth (1) Organic Constant-Currency Revenue Growth $826 $762 $662 $675 $636 $631 $634 $589 $563 32% 27% 16% 12% 11% 11% 11% 12% 8% 6% 5% 4% 8% 4% 7% 8% 3% 5% 18 18 18 18 19 19 19 19 20 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 (1) Reported revenue growth rates are impacted by the timing of acquisitions and divestitures. Cash Flow from Operations (2) Adjusted Free Cash Flow & Cash Interest Related to Borrowing (3) $183 Adj. FCF Interest $160 $109 $63 $48 $22 $16 $17 $(32) 18 18 18 18 19 19 19 19 20 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 (2) Q3FY18 cash flow from operations includes the payment of Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 contingent earn-out liabilities of $49.2 million related to the WIRmachenDRUCK and Easyflyer acquisitions. Adj. FCF ($13) $133 ($3) $23 ($10) $155 ($15) $82 $36 (3) Cash interest related to borrowing is total cash interest less interest expense for Waltham, MA lease. Interest (3) $7 $16 $6 $21 $6 $20 $8 $22 $9 Please see non-GAAP reconciliations at the end of this document. Page 7 of 34
SUMMARY CONSOLIDATED RESULTS: QUARTERLY TREND (CONTINUED) $ in millions, except percentages and share data GAAP Operating Income (Loss) Net Income (Loss) Attributable to Cimpress & Adjusted EBITDA $69 GAAP OI (Loss) Adjusted EBITDA $134 $138 $117 $34 $30 $91 $89 $23 $20 $78 $80 $73 $69 $7 $47 $49 $46 $42 $30 $22 $25 ($2) $17 ($7) ($15) ($6) Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 Net Debt (1) Weighted Average Shares Outstanding (Millions) (2) Cash / cash equivalents High yield notes Basic Diluted Term loan Revolver Other debt $50 $48 $48 $43 $40 $44 $44 $35 $31 32.3 32.3 31.8 31.5 31.3 30.7 30.8 30.9 30.5 ($275) ($275) ($275) ($400) ($400) ($400) ($400) ($400) ($400) 31.2 31.0 30.7 30.8 30.9 30.9 30.8 30.6 29.7 ($296) ($293) ($289) ($285) ($279) ($274) ($133) ($516) ($505) ($491) ($250) ($8) ($249) ($147) ($8) ($191) ($8) ($668) ($7) ($6) ($376) ($770) ($786) ($795) ($116) ($828) ($156) ($10) ($14) ($331) ($16) ($1,000) ($1,012) ($1,043) ($17) ($1,208) Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 (1) Excludes debt issuance costs (2) Basic and diluted shares are the same in certain periods where we reported a GAAP net loss. Please see non-GAAP reconciliations at the end of this document. Page 8 of 34
INCOME STATEMENT HIGHLIGHTS Our reported revenue growth was 8% in Q1. Growth was 2-Year Stacked Reported Revenue Growth positively impacted by the acquisition of BuildASign but negatively impacted by currency movements. Organic Earlier period Later period constant-currency revenue growth was 4% in Q1. Revenue growth was generally in line with the expectations 45% 48% we set with at the beginning of the fiscal year. Revenue 42% 40% 32% 16% 30% 8% trends are discussed in more detail in the segment 27% 32% 5% 12% 20% 19% 4% 13% commentary of this document. 26% 27% 32% 7% 18% 16% 18% 16% 8% 12% 5% 8 8 8 8 9 9 9 9 0 Q1 FY2020 GAAP operating income increased $31.4 '1 '1 '1 '1 '1 '1 '1 '1 '2 1 2 3 4 1 2 3 4 1 Q Q Q Q Q Q Q Q Q + + + + + + + + + million year over year to $25.4 million. The following year- 7 7 7 7 8 8 8 8 9 '1 '1 '1 '1 '1 '1 '1 '1 '1 1 2 3 4 1 2 3 4 1 over-year items positively influenced this result: Q Q Q Q Q Q Q Q Q • Profitability improvements across most of our businesses, with planned advertising expense reductions in Vistaprint and National Pen, as well as the benefits of recent changes we have made to enable stronger 2-Year Stacked Organic Constant-Currency execution. Revenue Growth • A $4.2 million decrease in share-based compensation expense excluding the effects of restructuring. In the Earlier period Later period current quarter we did not have costs related to our supplemental performance share unit awards (SPSUs) 22% that were included last year as we concluded in Q2 19% 20% 20% 18% 17% 16% FY2019 that the achievement of the relevant 11% 8% 14% 12% 11% 11% 6% 3% 5% 12% 4% performance condition was no longer probable. 11% 12% 11% 11% 11% 6% 8% 9% 8% 8 8 8 8 9 9 9 9 0 '1 '1 '1 '1 '1 '1 '1 '1 '2 1 2 3 4 1 2 3 4 1 These increases to Q1 operating income were partially Q Q Q Q Q Q Q Q Q + + + + + + + + + 7 7 7 7 8 8 8 8 9 '1 '1 '1 '1 '1 '1 '1 '1 '1 offset by increased investments, including in technology, as 1 2 3 4 1 2 3 4 1 well as additional restructuring charges and amortization of Q Q Q Q Q Q Q Q Q acquired intangibles. Adjusted EBITDA for Q1 FY2020 was $79.5 million, up 87% from Q1 FY2019. Adjusted EBITDA excludes several GAAP Operating Income (Loss) ($M) costs and benefits in our operating income, but was also up & Margin (%) (Quarterly) significantly in Q1 FY2020 due to many of the same $91 reasons described above. In addition, the BuildASign $73 11% $47 $49 acquisition positively influenced adjusted EBITDA to a $22 $30 $25 10% $17 greater degree than operating income because EBITDA 8% (1)% 7% 5% excludes the amortization of acquired intangibles that 3% 4% 4% ($6) weigh on operating income year over year. Another meaningful difference between operating income and 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY adjusted EBITDA is the inclusion of realized gains or losses Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 on our currency derivatives intended to hedge EBITDA, which was a significant year-over-year benefit this quarter (details on page 20). Adjusted EBITDA ($M) & Margin (%) (continued on next page) (Quarterly) $134 $138 $117 $89 $78 $80 $69 $46 18% $42 17% 17% 13% 13% 11% 12% 8% 7% 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Please see non-GAAP reconciliations at the end of this document. Page 9 of 34
INCOME STATEMENT HIGHLIGHTS (CONTINUED) GAAP net income (loss) per diluted share for the first GAAP Operating Income & Adjusted EBITDA ($M) quarter was $0.66, versus ($0.47) in the same quarter a (TTM) year ago. In addition to the factors described above, GAAP net income was influenced by non-operational, non-cash TTM OI TTM Adj EBITDA year-over-year currency impacts in Other income (expense), net (details on page 20). $424 $387 $347 $326 $323 $327 Gross profit (revenue minus the cost of revenue) $308 $289 increased year over year by $21.8 million in the first $249 quarter. Gross profit benefited from the inclusion of $195 BuildASign, which was not reflected in the year-ago results. $158 $164 $126 $123 $136 Gross profit improved year over year in all segments, $105 partially offset by unfavorable currency movements. $68 $29 Gross margin (revenue minus the cost of revenue 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY expressed as a percent of revenue) in the first quarter was Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 48.6%, flat compared to the same quarter a year ago. Changes in mix and unfavorable currency impacts were offset by production and cost efficiencies during the quarter. Gross Profit ($M) & Gross Margin (%) Contribution profit (revenue minus the cost of revenue, advertising and payment processing) increased year over Gross Profit Gross Margin % year by $41.6 million in Q1. In addition to the increase in gross profit, contribution profit also increased due to the $402 $414 $317 $315 $319 $330 $308 positive impact of the reduction in Vistaprint and National $280 $287 Pen advertising spend. 52.7% Contribution margin (revenue minus the cost of revenue, 49.6% 49.8% 49.8% 48.6% 50.2% 48.2% 48.9% 48.6% the cost of advertising and payment processing, expressed 8 8 8 8 9 9 9 9 0 as a percent of revenue) in the first quarter was 32.3%, up Y1 Y1 Y1 Y1 Y1 Y1 Y1 Y1 Y2 1F 2F 3F 4F 1F 2F 3F 4F 1F from 27.7% in the same quarter a year ago. This was Q Q Q Q Q Q Q Q Q driven by the reduction in Vistaprint and National Pen advertising spend. Advertising as a percent of revenue decreased Contribution Profit ($M) & Contribution Margin (%) significantly year over year for the first quarter from 19.0% to 14.7%, for the same reasons described above. Contribution Profit Contribution Margin % $261 $266 $239 $198 $206 $210 $205 $175 $163 34.3% 35.4% 31.0% 31.2% 32.6% 32.3% 31.8% 32.3% 27.7% 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Please see non-GAAP reconciliations at the end of this document. Page 10 of 34
CASH FLOW & RETURN ON INVESTED CAPITAL We generated $62.9 million of cash from operations in Adjusted Free Cash Flow & Q1 FY2020, compared with $22.2 million in the year-ago Cash Interest Related to Borrowing ($M) period. The increase was driven by a $37.1 million increase (Quarterly) in adjusted EBITDA as described on page 9 of this document. Additionally, cash from operations benefited FCF Interest from a continued focus on improving working capital efficiency and from lower cash taxes. The chart "Certain Cash Payments Impacting Cash Flow from Operations" on the next page illustrates the impact of interest expense, restructuring payments and earn-outs on our operating cash flow. Adjusted free cash flow was $36.2 million in the first quarter of FY2020 compared to ($10.1) million in the same period a year ago. Adjusted free cash flow benefited from Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 similar factors as our operating cash flow. In addition, Q1 FY2020 capital expenditures and capitalized software decreased by $5.6 million in total compared to the year-ago period. Q118 Q218 Q318 Q418 Q119 Q219 Q319 Q419 Q120 Adj. FCF ($13) $133 ($3) $23 ($10) $155 ($15) $82 $36 Internally, our most important annual performance metric is Interest $7 $16 $6 $21 $6 $20 $8 $22 $9 unlevered free cash flow, which we define as adjusted free cash flow plus cash interest expense related to borrowing. The top two charts at the right illustrate these Adjusted Free Cash Flow & components on a quarterly and trailing-twelve-month basis. Cash Interest Related to Borrowing ($M) (TTM) The GAAP operating measures that we use as a basis to calculate adjusted return on invested capital (adjusted FCF Interest ROIC) are total debt, total shareholders' equity, and operating income. Debt increased compared to the year- ago period in conjunction with our acquisition of BuildASign and recent share repurchases. On a trailing-twelve-month $60 $57 basis, adjusted ROIC as of September 30, 2019 improved $53 $49 $48 $55 compared to the prior-year Q1 TTM period with improved $43 $44 $258 $212 $165 $153 profits. $41 $106 $124 $139 $142 $50 Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 Adjusted Return on Invested Capital (TTM) Adjusted ROIC Adjusted ROIC ex SBC 23% 21% 18% 18% 18% 17% 17% 22% 14% 19% 9% 16% 13% 14% 13% 14% 10% 6% Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 Please see non-GAAP reconciliations at the end of this document. Page 11 of 34
CASH FLOW & ROIC (CONTINUED) Cash Flow from Operations ($M) Cash Flow from Operations ($M) (Quarterly) (TTM) $183 $160 $372 $331 $109 $270 $63 $48 $219 $221 $192 $198 $16 $22 $17 $164 $178 $(32) 18 18 18 18 19 19 19 19 20 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Certain Cash Payments Impacting Certain Cash Payments Impacting Cash Flow from Operations ($M)* Cash Flow from Operations ($M)* (Quarterly) (TTM) Cash Restructuring Cash Restructuring Cash Interest Related to Borrowing Cash Interest Related to Borrowing Cash Earn-Out Payments Cash Earn-Out Payments $59 $116 $115 $111 $110 $49 $49 $49 $49 $69 $67 $49 $60 $62 $63 $23 $23 $23 $20 $43 $44 $41 $49 $48 $53 $55 $57 $60 $11 $16 $11 $11 $21 $7 $22 $7 $6 $8 $9 $26 $7 $6 $19 $23 $17 $14 $4 $4 $2 $1 $3 $1 $2 $8 $7 $6 $7 18 18 18 18 19 19 19 19 20 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Capital Expenditures & Capitalization of Software Capital Expenditures & Capitalization of Software & Website Development Costs ($M) & Website Development Costs ($M) (Quarterly) (TTM) Capital Expenditures Capitalized Software Capital Expenditures Capitalized Software $32 $32 $113 $113 $117 $120 $114 $29 $29 $103 $102 $104 $106 $27 $27 $26 $24 $11 $13 $38 $36 $46 $49 $9 $9 $20 $11 $38 $41 $43 $45 $50 $11 $14 $12 $11 $20 $21 $19 $75 $77 $71 $71 $18 $18 $14 $65 $61 $61 $61 $64 $9 $13 $13 18 18 18 18 19 19 19 19 20 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 * Cash restructuring and cash interest related to borrowing impact both cash flow from operations and adjusted free cash flow. Cash earn-out payments impact cash flow from operations but are excluded from adjusted free cash flow. Please see non-GAAP reconciliations at the end of this document. Page 12 of 34
DEBT & SHARE REPURCHASES As of September 30, 2019, our total debt net of issuance Total Leverage Ratio* costs, was $1,227.8 million. Net debt, excluding issuance costs and net of cash on the balance sheet, was $1,208.0 3.39 3.21 3.19 3.00 million. 2.58 2.79 2.75 2.81 2.74 The calculation for our debt-covenant-defined leverage ratio (either total or senior secured debt to trailing-twelve- month EBITDA) uses definitions of both debt and EBITDA Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 that differ from the corresponding figures reported in this document. For example, the EBITDA defined in our debt covenants gives pro forma effect for acquired and divested *Total leverage ratio as calculated in accordance with our debt covenants businesses that closed within each trailing-twelve-month period, as well as other smaller differences. Amount Available for Borrowing ($M) $568 $564 $604 When calculated per the definitions in our debt covenants, $490 $522 $439 $424 $439 our total leverage ratio was 3.00 as of September 30, 2019, $262 and our senior secured leverage ratio was 2.03, an increase compared to June 30, 2019. This was driven by the share repurchases outlined below, partially offset by the sequential expansion of EBITDA. Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 During Q1 FY2020 we repurchased 1,963,629 Cimpress shares for $232.3 million at an average price per share of $118.29. Since the end of the quarter, we have Interest Expense Related to Borrowing ($M)* repurchased an additional 585,106 Cimpress shares for (Income Statement View) $75.6 million at an average price per share of $129.14. We consider share repurchases to be an important category of $14 $15 $14 $15 $12 capital deployment. We make our share repurchase $11 $10 $11 $11 decisions by comparing the potential returns of share repurchases to the potential returns on other uses of that capital. Our choice to repurchase is also guided by Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 obligations under our equity compensation plans, our debt covenants and, as the case may be, acquisitions or similar transactions that may be funded with our own shares, as *Excludes interest expense associated with our Waltham, Massachusetts well as legal and tax considerations. lease as well as investment consideration Share Repurchases ($M) $232 $41 $40 $29 $15 $— $— $14 $12 Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 Please see non-GAAP reconciliations at the end of this document. Page 13 of 34
SEGMENT RESULTS VISTAPRINT Revenue ($M) & Reported Revenue Growth Vistaprint's Q1 FY2020 reported revenue declined year Quarterly over year by 1%, and constant-currency revenue grew by $439 $444 1%. We continue to expect flat-to-negative growth for $326 $367 $367 $345 $359 $360 $343 Vistaprint for the foreseeable future. 11% 12% 11% 11% 6% 1% (2)% (2%) (1%) Vistaprint's segment EBITDA increased year over year by $20.6 million in Q1 FY2020. Segment EBITDA margin Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 improved by 610 basis points. This was driven by year- over-year reductions in advertising spend of $21.6 million, a 29.1% decrease, as well as increased gross margin. These benefits were partially offset by a year-over-year Organic Constant-Currency Revenue Growth increase in technology investments and consulting Quarterly projects. 10% 9% 9% 7% 7% 3% All periods reflect the Q1 FY2020 inclusion and historical 1% —% 1% recast of Vistaprint Corporate Solutions, Vistaprint Japan and Vistaprint India into this segment. This change resulted Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 in a small benefit to year-over-year revenue and segment EBITDA trends (less than 1 percentage point of revenue growth and about $0.4 million of EBITDA improvement). 2-Year Stacked Organic Constant-Currency We have made many small changes across a number of Revenue Growth areas that have improved customer value and helped to optimize our efficiency and performance, in line with the plans we shared at our August 2019 investor day. Earlier period Later period Significant advertising expense reductions that improve returns continued this quarter, similar to the trends in the 17% second half of 2019. 7% 12% 3% 8% 9% 8% Vistaprint's technology team is making steady progress on 1% 1% 10% 9% 9% the multi-year project to rebuild Vistaprint's technology 7% 7% infrastructure. During the quarter, we launched a proof of Q1'18+Q1'19 Q2'18+Q2'19 Q3'18+Q3'19 Q4'18+Q4'19 Q1'19+Q1'20 concept test site built on this new technology. We are happy with progress to date, but caution that we remain only in the very early stages of this technology development process, and we do not expect launch in our Segment EBITDA ($M) & Segment EBITDA Margin largest (U.S.) market prior to Q3 of FY2021. Quarterly $111 Four new executives have joined the Vistaprint executive $97 $83 $88 $81 $70 $68 $60 team, bringing very strong backgrounds in their respective $42 25% 22% 23% 24% 23% 19% 19% 17% fields. These executives bring us leadership experience 13% from companies such as Amazon, eBay, Lowes, McKinsey, and Nike. Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 In September 2019, Vistaprint tested and rolled out an offer of free standard shipping on all business card orders in the U.S. market. We believe this aligns us closer to e- Vistaprint Advertising ($M) & as % of Revenue commerce norms. We expect to test similar offers in other $91 $92 geographies over the remainder of the fiscal year. $75 $78 $78 $74 $62 $54 $53 23% 21% 21% 21% 22% 21% 17% 15% 15% Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Please see non-GAAP reconciliations at the end of this document. Page 14 of 34
UPLOAD AND PRINT Financial results for PrintBrothers and The Print Group are presented on page 5 of this document, as well as on the next page. Combined upload and print group revenue (i.e., the combination of revenue for PrintBrothers and The Print Group, adjusted to exclude inter-segment revenue when conducted between businesses in these segments) in Q1 FY2020 was in line with the expectations we set at the beginning of the fiscal year. Revenue in Q1 FY2020 grew year over year by 5% in USD and 10% in constant currencies. Combined upload and print group EBITDA (i.e., the combination of segment EBITDA for PrintBrothers and The Print Group) increased by $2.0 million year over year in Q1 FY2020, and group EBITDA margin was flat compared to the year-ago period. These results were primarily driven by production and operating expense efficiencies, offset by investments that are not yet improving in-period EBITDA, unfavorable currency impacts, and the year-over-year impact of previously described price reductions in response to competition. We continue to see very aggressive price competition and online search competition in the upload and print space in Europe. We are committed to defending our price and marketing leadership positions, including continuing price reductions which we have implemented in the recent past. This negatively impacts our revenue and EBITDA, but we are prepared to maintain this defensive stance indefinitely because we believe that, over the long term, it is in the best interests of our customers and our cost structure should allow us to outlast the competition. Our upload and print businesses are working more closely together than in the past to exploit scale advantages and improve their competitiveness. These businesses also continue to invest in modernized e-commerce technologies and increasingly adopt our mass customization platform (MCP) microservices, which we believe over the long term will improve customer value and the efficiency of each business. WHAT BUSINESSES ARE IN THESE SEGMENTS? PRINTBROTHERS: THE PRINT GROUP: Please see non-GAAP reconciliations at the end of this document. Page 15 of 34
PRINTBROTHERS: THE PRINT GROUP: Revenue ($M) & Reported Revenue Growth Revenue ($M) & Reported Revenue Growth Quarterly Quarterly $107 $108 $116 $109 $117 $109 $86 $80 $86 $88 $79 $88 $92 $104 $101 $69 $71 $72 30% 35% 23% 23% 26% 26% 16% 13% 4% 3% 3% 2% 10% 8% 5% 8% 8% (2)% 18 18 18 18 19 19 19 19 20 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Organic Constant-Currency Revenue Growth Organic Constant-Currency Revenue Growth Quarterly Quarterly 20% 19% 17% 16% 14% 15% 12% 12% 13% 11% 13% 9% 7% 4% 5% 6% 6% 7% 18 18 18 18 19 19 19 19 20 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2-Year Stacked Organic Constant-Currency 2-Year Stacked Organic Constant-Currency Revenue Growth Revenue Growth Earlier period Later period Earlier period Later period 32% 31% 31% 31% 19% 25% 16% 12% 12% 14% 15% 6% 13% 13% 12% 13% 5% 6% 9% 7% 20% 19% 17% 16% 11% 13% 12% 7% 4% 5% Q1'18+Q1'19 Q2'18+Q2'19 Q3'18+Q3'19 Q4'18+Q4'19 Q1'19+Q1'20 Q1'18+Q1'19 Q2'18+Q2'19 Q3'18+Q3'19 Q4'18+Q4'19 Q1'19+Q1'20 Segment EBITDA ($M) & Segment EBITDA Margin Segment EBITDA ($M) & Segment EBITDA Margin Quarterly Quarterly $13 $20 $20 $12 $12 $11 $12 $11 $17 $15 $16 $16 $8 $9 $8 $12 $12 $14 9% 11% 9% 11% 10% 10% 11% 10% 7% 23% 23% 18% 20% 19% 17% 19% 20% 19% 18 18 18 18 19 19 19 19 20 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Please see non-GAAP reconciliations at the end of this document. Page 16 of 34
NATIONAL PEN National Pen's Q1 FY2020 revenue growth was in line with Revenue ($M) & Reported Revenue Growth our expectation. The revenue and EBITDA results in this Quarterly segment reflect a year-over-year reduction in prospecting $126 $133 activities which we continue to expect to lay the foundation $82 $80 $60 $66 $66 $70 $70 for a more successful FY2020 than FY2019. The lower 39% 22% prospecting levels mean that we anticipate flat-to-low 10% 5% 6% 6% single-digit constant-currency revenue growth for the full (2%) year. This remains the case despite Q1 FY2020 constant- currency revenue growth of 8%. Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 Segment EBITDA (loss) improved year over year by $6.6 million in Q1 FY2020. Segment EBITDA (loss) margin improved 1090 basis points in Q1 FY2020 compared to the Organic Constant-Currency Revenue Growth* year-ago period. About half of the year-over-year loss Quarterly improvement was due to prospecting and advertising expense reductions and the remainder due to operational 28% 30% 19% improvements. These savings were partially offset by 11% 7% 8% 8% 1% accelerated investment in e-commerce technology. (3%) National Pen's operational results during Q1 FY2020 reflect solid progress against the priorities we discussed at our Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 August 2019 investor day including a continued expansion of National Pen's new e-commerce platform, improvements *Constant-currency revenue growth excludes discontinued operations in to customer value, the initial steps of migration of European Q1 FY2018 and Q2 FY2018. mail fulfillment from Mexico to Europe to reduce disruptions that occurred in transit last fiscal year, and continued Segment EBITDA (Loss) ($M)* & manufacturing improvements. Segment EBITDA (Loss) Margin Quarterly $27 $19 $7 $3 $5 20% 15% $2 $— 8% 10% 5% 3% —% ($10) ($16) (14%) (25%) Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 *Starting in Q1 FY2019, segment EBITDA was impacted by the adoption of the new U.S. GAAP revenue recognition standard that results in the earlier recognition of direct mail expenses in our National Pen business.This is an expense timing impact only that created fluctuations in year-over-year segment EBITDA trends throughout FY19. The accounting treatment for Q1 FY2020 and Q1 FY2019 is comparable. Please see non-GAAP reconciliations at the end of this document. Page 17 of 34
ALL OTHER BUSINESSES The growth rates for the various businesses that comprise Revenue ($M) & Reported Revenue Growth this segment vary greatly from each other and tend to Quarterly fluctuate from quarter to quarter. The largest business in this segment, BuildASign, grew in line with expectations set Revenue (excluding Albumprinter) at the beginning of the fiscal year. The early-stage Albumprinter Revenue businesses in this segment delivered mixed revenue results during Q1 FY2020. These businesses continue to Reported Revenue Growth pivot and evolve their business models as they learn more about the markets they serve, and therefore, we expect $48 fluctuations in growth. The organic growth rate for this $42 $42 $38 segment is currently suppressed by recent actions we have 544% 500% taken to improve some of these businesses, especially 443% 448% Printi in Brazil. $19 $13 $7 $7 $7 $8 Last quarter, we described poor financial results at Printi for $6 FY2019. We are pleased to report that Q1 FY2020 results (1%) were much improved from the recent trend. Printi's fixed (78%) (65%) (66%) (59%) costs have been substantially reduced with a focus on profitable growth and serving customers in the core business in which Printi leads in Brazil's online printing industry. We expect Printi's FY2020 EBITDA losses to be Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 far lower than FY2019 and believe we now have a clear path to break-even in FY2021. Q1 FY2020 segment EBITDA (loss) improved year over Organic Constant-Currency Revenue Growth year by $6.4 million, driven by the BuildASign acquisition, Quarterly as well as profitability improvements in our Printi business. 79% Segment EBITDA (loss) margin improved year over year 74% from (61%) last year to 4% in Q1 FY2020 due primarily to 59% the BuildASign acquisition. 41% 16% BUSINESSES IN THIS REPORTABLE SEGMENT: 12% With the exception of BuildASign, which is a larger and —% (4%) profitable business, the All Other Businesses segment (15%) consists of multiple small, rapidly evolving early-stage businesses that we continue to manage at an operating Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 loss as previously described and planned. These businesses are subject to high degrees of risk and we expect fluctuations in growth as each of their business models rapidly evolve in function of customer feedback, testing, and entrepreneurial pivoting. Segment EBITDA (Loss) ($M) & BuildASign is an e-commerce provider of canvas-print wall Segment EBITDA (Loss) Margin décor, business signage and other large-format printed Quarterly products, based in Austin, Texas. Printi, the online printing leader in Brazil, offers a superior $2 $2 customer experience with transparent and attractive pricing, $— ($1) reliable service and quality. ($2) 4% 4% (2%) ($3) ($3) (3%) VIDA is an innovative startup that brings manufacturing access ($4) ($5) (5%) and an e-commerce marketplace to artists, thereby enabling artists to convert ideas into beautiful, original products for (49%) (55%) customers, ranging from custom fashion, jewelry and (40%) (61%) accessories to home accent pieces. YSD is a startup business that provides end-to-end mass customization software solutions to brands and IP owners in China, supporting multiple channels including retail stores, Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 websites, WeChat and e-commerce platforms to enhance brand awareness and competitiveness, and develop new markets. Please see non-GAAP reconciliations at the end of this document. Page 18 of 34
CENTRAL AND CORPORATE COSTS Central and corporate costs decreased 8% year over year Central and Corporate Costs ($M)* in Q1 FY2020 from $29.3 million to $26.9 million, largely Quarterly the result of the Q2 FY2019 reversal of share-based compensation (SBC) expense related to supplemental Corporate Costs performance share unit awards (SPSUs). Additionally, our SBC is lower year over year due to the changes we made Central Operating Costs in November, 2018 that reduced the number of directors MCP Investment on our board of directors. Unallocated SBC Excluding unallocated SBC, central and corporate costs were up year over year during the quarter and the fiscal year, due primarily to increased central technology $33 $31 $30 $29 investments and central operating costs, which were $2 $27 $25 $9 $26 7 $7 $7 $4 $13 largely offset by efficiencies elsewhere in the financial $2 $3 $6 $5 $6 results of our businesses. $5 $5 $5 $5 $6 $5 $9 $10 $9 $9 $9 $9 $10 $10 $9 Our central technology teams continue to make good progress in developing new MCP technologies and in $10 $9 $10 $10 $11 $9 $10 $9 $12 helping our businesses adopt pre-existing ones. Recent ($1) additions to this set of micro-services include machine $(11) learning that improves customer experience, drives higher conversion rates and automates manual processes. Vistaprint has used portions of the MCP technology for multiple years and will use it much more extensively in the Q1FY18Q2FY18Q3FY18Q4FY18Q1FY19Q2FY19Q3FY19Q4FY19Q1FY20 future as part of the multi-year re-build of the Vistaprint technology platform. We anticipate that we can deploy the *Q2 FY2019 Central and Corporate Costs were impacted by the reversal new Vistaprint platform faster and with lower risk because of the previously recognized $15.4 million expense for our SPSUs, when it will leverage many pre-existing MCP technologies. we concluded that the achievement of the performance condition was no longer probable. Please see our Q2 FY2019 "Quarterly Earnings Document" for more context. WHAT ARE CENTRAL AND CORPORATE COSTS? The GAAP accounting value of performance Central and Corporate Costs share units (PSUs) across Cimpress, minus Excluding Unallocated Share-Based Comp* what we cross-charge either to our businesses Unallocated or to the above central cost categories. We ($M and as a % of Total Revenue) Share cross-charge the cash grant value of a long-term Based incentive award. Additionally, the accounting Comp $26 $27 value of the Supplemental PSUs (SPSUs) $24 $24 $25 $24 $24 expense or benefit, if any, are included in this $23 $23 category. MCP Software engineering and related costs to 4% 4% 4% 4% 4% 4% 4% expand the functionality of our Mass 3% 3% Investment Customization Platform (MCP). Our operationally oriented shared-service organizations of (1) global procurement, (2) the technical maintenance and hosting of the MCP, Central and (3) privacy and information security Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Operating management, plus the administrative costs of Costs our Cimpress India offices where numerous Cimpress businesses have dedicated business- *We present this cost category excluding the Unallocated SBC to help specific team members. These costs are required to operate our businesses. our investors see the potential for scale leverage in these central costs without the volatility and accounting complexities of the Unallocated Corporate activities, including the office of the SBC. For avoidance of doubt, we view SBC as a cost, and believe CEO, the board, directors and officers investors should too. As a reminder, we charge our businesses a cost insurance, treasury, tax, capital allocation, based on the cash value of long-term incentive grants, which excludes financial consolidation, audit, corporate legal, some of these accounting complexities, and which is included in each Corporate internal company-wide communications, segment's results each period. You can find additional information on the Costs investor relations and corporate strategy. LTI overview document posted on ir.cimpress.com. All numbers are Additionally, the expense or benefit, if any, for the supplemental performance cash awards that rounded to the nearest million and may not sum to total Central and accompany some of the SPSUs are included in Corporate Costs when combined with the rounded Unallocated SBC this category. figures in the chart above. Please see non-GAAP reconciliations at the end of this document. Page 19 of 34
CURRENCY IMPACTS Y/Y Impact from Currency* Changes in currency rates negatively impacted our year- Financial Measure Q1 FY2020 over-year reported revenue growth rate by 200 basis points Revenue Negative in Q1 FY2020. There are many natural expense offsets in Operating income Negative local currencies in our business and, therefore, the net Net income Positive currency impact to our bottom line is less pronounced than it is to revenue. As such, we look at constant-currency Segment EBITDA Mixed by segment growth rates to understand revenue trends in the absence Adjusted EBITDA Positive of currency movements but typically evaluate our bottom Adjusted free cash flow Positive line inclusive of currency movements. *Net income includes both realized and unrealized gains or losses from currency hedges and intercompany loan balances. Adjusted EBITDA Our most significant net currency exposures by volume are includes only realized gains or losses from certain currency hedges. the Euro and the British Pound. We enter into currency Adjusted free cash flow includes realized gains or losses on currency hedges as well as the currency impact of the timing of receivables, derivative contracts to hedge the risk for certain currencies payments and other working capital settlements. Revenue, operating where we have a net adjusted EBITDA exposure. We income and segment EBITDA do not reflect any impacts from currency hedge our adjusted EBITDA exposures because a slightly hedges or balance sheet translation. different but similar EBITDA measure is the primary metric used in our debt covenants. We do not apply hedge Other Income (Expense), Net ($M) accounting to these hedges, which increases the volatility $16 of the gains or losses that are included in our net income from quarter to quarter. Realized and unrealized gains or $10 $10 losses from these hedges are recorded in Other income $9 (expense), net, along with other currency-related gains or $5 losses. The realized gains or losses on our hedging contracts are added to our adjusted EBITDA to show the economic impact of our hedging activities. ($2) ($2) Our Other income (expense), net was $15.7 million in Q1 ($8) FY2020. The vast majority of this is currency related, as follows: ($16) 8 8 8 8 9 9 9 9 0 • Realized gains on certain currency hedges were $4.8 Y1 Y1 Y1 Y1 Y1 Y1 Y1 Y1 Y2 1F 2F 3F 4F 1F 2F 3F 4F 1F million for the first quarter. These realized gains affect our Q Q Q Q Q Q Q Q Q net income, adjusted EBITDA, and adjusted free cash flow. • Unrealized currency net gains of approximately $10.9 million in Q1 were primarily related to the revaluation of Realized Gains (Losses) on intercompany, cash, and debt balances, and currency Certain Currency Derivatives ($M) hedges. These are included in our net income but $7 excluded from our adjusted EBITDA. $6 $5 $5 Overall, for the reasons described above, year-over-year $2 fluctuations in currencies create different impacts on the various financial results you see throughout this document. At the top right of this page is a table describing these ($1) directional net currency impacts when compared to the ($2) prior-year period. ($4) ($5) 18 18 18 18 19 19 19 19 20 FY FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Please see non-GAAP reconciliations at the end of this document. Page 20 of 34
HOUSEKEEPING ITEMS Please note the following housekeeping items: • On October 25, 2019, we held an extraordinary general meeting during which our shareholders voted in favor of our proposed cross-border merger that will result in a change of our jurisdiction of incorporation from the Netherlands to Ireland. We expect to complete the merger in early December, 2019. At that point, the parent company name will change from Cimpress N.V. to Cimpress plc. Otherwise, there are no material changes: we will continue to be listed on Nasdaq under the symbol “CMPR”, we will remain subject to the U.S. Securities and Exchange Commission reporting requirements and the applicable corporate governance rules of Nasdaq, and we will continue to report our financial results in U.S. dollars and under U.S. generally accepted accounting principles. • We expect Swiss tax reform to be enacted in the quarter ending December 31, 2019 at which point we will remeasure our existing Swiss deferred tax assets and liabilities and establish new Swiss deferred tax assets related to transitional relief measures in the quarter ending December 31, 2019. We expect this will result in a material tax benefit for U.S. GAAP reporting, but are unable to quantify the benefit at this time. This will have no impact on cash taxes for this fiscal year. Please see non-GAAP reconciliations at the end of this document. Page 21 of 34
CIMPRESS N.V. CONSOLIDATED BALANCE SHEETS (unaudited in thousands, except share and per share data) September 30, June 30, 2019 2019 Assets Current assets: Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 31,234 $ 35,279 Accounts receivable, net of allowances of $8,781 and $7,313, respectively . . . . . . . . . . . . 68,518 60,646 Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82,282 66,310 Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87,161 78,065 Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 269,195 240,300 Property, plant and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362,045 490,755 Operating lease assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 176,677 — Software and website development costs, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,090 69,840 Deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57,527 59,906 Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 711,670 718,880 Intangible assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 245,514 262,701 Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,751 25,994 Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,939,469 $ 1,868,376 Liabilities, noncontrolling interests and shareholders’ equity Current liabilities: Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 182,858 $ 185,096 Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 216,000 194,715 Deferred revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,533 31,780 Short-term debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63,136 81,277 Operating lease liabilities, current. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36,274 — Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,714 27,881 Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 546,515 520,749 Deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,967 44,531 Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,164,696 942,290 Lease financing obligation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 112,096 Operating lease liabilities, non-current . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 146,678 — Other liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53,708 53,716 Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,949,564 1,673,382 Commitments and contingencies Redeemable noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65,507 63,182 Shareholders’ equity: Preferred shares, par value €0.01 per share, 100,000,000 shares authorized; none issued and outstanding. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — Ordinary shares, par value €0.01 per share, 100,000,000 shares authorized; 44,080,627 shares issued; and 28,483,314 and 30,445,669 shares outstanding, respectively . . . . . . . 615 615 Treasury shares, at cost, 15,597,313 and 13,634,958 shares, respectively. . . . . . . . . . . . . (969,833) (737,447) Additional paid-in capital. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 415,984 411,079 Retained earnings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 560,596 537,422 Accumulated other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (82,964) (79,857) Total shareholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (75,602) 131,812 Total liabilities, noncontrolling interests and shareholders’ equity. . . . . . . . . . . . . . . . . . . . . . $ 1,939,469 $ 1,868,376 Page 22 of 34
CIMPRESS N.V. CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited in thousands, except share and per share data) Three Months Ended September 30, 2019 2018 Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 633,959 $ 588,981 Cost of revenue (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 325,665 302,471 Technology and development expense (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63,167 57,063 Marketing and selling expense (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160,917 182,788 General and administrative expense (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,623 41,176 Amortization of acquired intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,018 11,301 Restructuring expense (1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,190 170 Income (loss) from operations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,379 (5,988) Other income, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,674 10,252 Interest expense, net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (15,087) (13,777) Income (loss) before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,966 (9,513) Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,115 5,481 Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,851 (14,994) Add: Net loss attributable to noncontrolling interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 180 355 Net income (loss) attributable to Cimpress N.V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 20,031 $ (14,639) Basic net income (loss) per share attributable to Cimpress N.V. . . . . . . . . . . . . . . . . . . . . . . $ 0.67 $ (0.47) Diluted net income (loss) per share attributable to Cimpress N.V. . . . . . . . . . . . . . . . . . . . . . $ 0.66 $ (0.47) Weighted average shares outstanding — basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,747,035 30,883,617 Weighted average shares outstanding — diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,529,472 30,883,617 ____________________________________________ (1) Share-based compensation is allocated as follows: Three Months Ended September 30, 2019 2018 Cost of revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 88 $ 115 Technology and development expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,734 2,208 Marketing and selling expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,311) 1,363 General and administrative expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,239 5,230 Restructuring expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 664 — Page 23 of 34
CIMPRESS N.V. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited, in thousands) Three Months Ended September 30, 2019 2018 Operating activities Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 19,851 $ (14,994) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,535 40,718 Share-based compensation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,414 8,916 Deferred taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (960) (3,963) Unrealized gain on derivatives not designated as hedging instruments included in net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (14,527) (5,766) Effect of exchange rate changes on monetary assets and liabilities denominated in non- functional currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,028 (2,856) Other non-cash items . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,365 745 Changes in operating assets and liabilities: Accounts receivable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,595) (7,291) Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,410) (11,316) Prepaid expenses and other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 737 783 Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (11,038) 1,586 Accrued expenses and other liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,505 15,658 Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62,905 22,220 Investing activities Purchases of property, plant and equipment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (14,193) (21,026) Business acquisitions, net of cash acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,272) (18,000) Purchases of intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (22) Capitalization of software and website development costs. . . . . . . . . . . . . . . . . . . . . . . . . . . (12,471) (11,233) Proceeds from the sale of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 670 318 Other investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 903 395 Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (29,363) (49,568) Financing activities Proceeds from borrowings of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 277,785 245,096 Payments of debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (74,392) (206,692) Payments of debt issuance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (1,458) Payments of withholding taxes in connection with equity awards. . . . . . . . . . . . . . . . . . . . . . (359) (1,766) Payments of finance lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,719) (4,182) Purchase of ordinary shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (231,883) — Other financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,437) 645 Net cash (used in) provided by financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (33,005) 31,643 Effect of exchange rate changes on cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,582) (454) Net (decrease) increase in cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,045) 3,841 Cash and cash equivalents at beginning of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,279 44,227 Cash and cash equivalents at end of period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 31,234 $ 48,068 Page 24 of 34
ABOUT NON-GAAP FINANCIAL MEASURES: To supplement Cimpress’ consolidated financial statements presented in accordance with U.S. generally accepted accounting principles, or GAAP, Cimpress has used the following measures defined as non-GAAP financial measures by Securities and Exchange Commission, or SEC, rules: Constant-currency revenue growth, constant-currency revenue growth excluding revenue from acquisitions and divestitures made in the last twelve months, upload and print group revenue growth, constant currency revenue growth and profit, adjusted EBITDA, adjusted free cash flow and trailing- twelve-month return on invested capital: • 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. • Constant-currency revenue growth excluding revenue from acquisitions and divestitures made during the past twelve months excludes the impact of currency as defined above. The organic constant-currency growth rate excludes Albumprinter revenue from Q1 FY2017 through Q1 FY2018, Digipri (the part of our Japan business that we previously sold) revenue for Q2 FY2018, VIDA revenue from Q1 FY2019 through Q4 FY2019, and BuildASign revenue for all periods. • Upload and print group revenue growth is the combination of revenue for PrintBrothers and The Print Group in USD, adjusted to exclude inter-segment revenue when conducted between businesses in these segments. Upload and print group constant-currency revenue growth is the combination of revenue for PrintBrothers and The Print Group in constant currencies, adjusted to exclude inter-segment revenue when conducted between businesses in these segments. Upload and print group EBITDA is the combination of segment EBITDA for PrintBrothers and The Print Group. • Adjusted EBITDA is defined as operating income plus depreciation and amortization (excluding depreciation and amortization related to our Waltham, Massachusetts office lease) plus share-based compensation expense plus proceeds from insurance plus earn-out related charges plus certain impairments plus restructuring related charges plus realized gains or losses on currency derivatives less interest expense related to our Waltham, Massachusetts office lease less gain on purchase or sale of subsidiaries. • Adjusted free cash flow is defined as net cash provided by operating activities less purchases of property, plant and equipment, purchases of intangible assets not related to acquisitions, and capitalization of software and website development costs, plus payment of contingent consideration in excess of acquisition-date fair value, plus gains on proceeds from insurance. • Trailing-Twelve-Month Return on Invested Capital is adjusted NOPAT or adjusted NOPAT excluding share-based compensation, divided by debt plus redeemable noncontrolling interest plus shareholders' equity, less excess cash. Adjusted NOPAT is defined as adjusted EBITDA from above, plus depreciation and amortization (except depreciation related to Waltham lease and amortization of acquired intangibles), plus share-based compensation not related to investment consideration or restructuring, less cash taxes. Adjusted NOPAT excluding share-based compensation removes all share-based compensation expense in Adjusted NOPAT. Excess cash is cash and equivalents greater than 5% of last twelve month revenues and, if negative, is capped at zero. Leases have not been converted to debt for purposes of this calculation. These non-GAAP financial measures are provided to enhance investors' understanding of our current operating results from the underlying and ongoing business for the same reasons they are used by management. For example, as we have become more acquisitive over recent years we believe excluding the costs related to the purchase of a business (such as amortization of acquired intangible assets, contingent consideration, or impairment of goodwill) provides further insight into the performance of the underlying acquired business in addition to that provided by our GAAP operating income. As another example, as we do not apply hedge accounting for our currency forward contracts, we believe inclusion of realized gains and losses on these contracts that are intended to be matched against operational currency fluctuations provides further insight into our operating performance in addition to that provided by our GAAP operating income. We do not, nor do we suggest that investors should, consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared 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 document. 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. Page 25 of 34
CONSTANT-CURRENCY REVENUE GROWTH RATES (Quarterly) Total Company Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth 27 % 32 % 16 % 12 % 5% 8 % 4 % 7 % 8 % Currency impact (3)% (5)% (8)% (4)% 1% 3 % 5 % 3 % 2 % Revenue growth in constant currency 24 % 27 % 8 % 8 % 6% 11 % 9 % 10 % 10 % Impact of TTM acquisitions, divestitures & JVs (12)% (16)% 3 % 3 % 2% (5)% (6)% (5)% (6)% Revenue growth in constant currency ex. TTM 12 % 11 % 11 % 11 % 8% 6 % 3 % 5 % 4 % acquisitions, divestitures & JVs Vistaprint Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth 11 % 12 % 11 % 11 % 6% 1% (2)% (2)% (1)% Currency impact (1)% (3)% (4)% (2)% 1% 2% 3 % 2 % 2 % Revenue growth in constant currency 10 % 9 % 7 % 9 % 7% 3% 1 % — % 1 % Upload and Print ($M) Q1FY19 Q1FY20 PrintBrothers reported revenue $ 101.4 $ 109.3 The Print Group reported revenue $ 71.0 $ 72.3 Upload and Print inter-segment eliminations $ (0.2) $ (0.2) Total Upload and Print revenue in USD $ 172.2 $ 181.3 Upload and Print revenue growth in USD 5% Currency impact 5% Total Upload and Print revenue growth in constant currency 10% PrintBrothers Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth 26 % 30 % 35 % 26 % 10% 8% 5% 8% 8% Currency impact (6)% (11)% (18)% (10)% 2% 4% 9% 7% 5% Revenue growth in constant currency 20 % 19 % 17 % 16 % 12% 12% 14% 15% 13% Impact of TTM acquisitions — % — % — % — % —% —% —% —% —% Revenue growth in constant currency excl. TTM 20 % 19 % 17 % 16 % 12% 12% 14% 15% 13% acquisitions The Print Group Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth 16 % 23 % 23 % 13 % 4% 3% (2)% 3% 2% Currency impact (5)% (10)% (16)% (9)% 1% 3% 8 % 6% 5% Revenue growth in constant currency 11 % 13 % 7 % 4 % 5% 6% 6 % 9% 7% Impact of TTM acquisitions — % — % — % — % —% —% — % —% —% Revenue growth in constant currency excl. TTM 11 % 13 % 7 % 4 % 5% 6% 6 % 9% 7% acquisitions Values may not sum to total due to rounding. Page 26 of 34
CONSTANT-CURRENCY REVENUE GROWTH RATES (CONT'D) (Quarterly) National Pen Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth1 100 % 100 % 39 % 22 % 10% 5% (2)% 6% 6% Currency impact — % — % (9)% (3)% 1% 2% 3 % 2% 2% Revenue growth in constant currency 100 % 100 % 30 % 19 % 11% 7% 1 % 8% 8% Impact of TTM acquisitions (100)% (100)% — % — % —% —% — % —% —% Revenue growth in constant currency excl. TTM — % — % 30 % 19 % 11% 7% 1 % 8% 8% acquisitions Pro Forma National Pen Growth Rates: Pro forma revenue growth in U.S. dollars (5)% 33 % N/A N/A N/A N/A N/A N/A N/A Currency impact (2)% (5)% N/A N/A N/A N/A N/A N/A N/A Pro forma revenue growth in constant currency (7)% 28 % N/A N/A N/A N/A N/A N/A N/A Impact of discontinued operations 4 % — % N/A N/A N/A N/A N/A N/A N/A Pro forma revenue growth in constant currency, (3)% 28 % N/A N/A N/A N/A N/A N/A N/A excluding discontinued operations 1National Pen's reported revenue growth was 100% from Q3 FY17 to Q2 FY18 since we did not own this business in the corresponding year-ago periods. All Other Businesses Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth (1)% (78)% (65)% (66)% (59)% 544 % 443 % 500 % 448 % Currency impact (3)% (1)% 1 % 4 % 8 % 14 % 12 % 9 % 1 % Revenue growth in constant currency (4)% (79)% (64)% (62)% (51)% 558 % 455 % 509 % 449 % Impact of TTM acquisitions and divestitures 78 % 95 % 143 % 121 % 92 % (546)% (470)% (509)% (453)% Revenue growth in constant currency excl. TTM 74 % 16 % 79 % 59 % 41 % 12 % (15)% — % (4)% acquisitions & divestitures TWO-YEAR STACKED CONSTANT-CURRENCY ORGANIC REVENUE GROWTH RATES (Quarterly) Total Company Q1FY17 Q2FY17 Q3FY17 Q4FY17 Reported revenue growth 18 % 16 % 26 % 18 % Currency impact 1 % 2 % 2 % 2 % Revenue growth in constant currency 19 % 18 % 28 % 20 % Impact of TTM acquisitions, divestitures & JVs (13)% (10)% (17)% (11)% Revenue growth in constant currency ex. TTM acquisitions, divestitures & JVs 6 % 8 % 11 % 9 % Values may not sum to total due to rounding. Page 27 of 34
TWO-YEAR STACKED CONSTANT-CURRENCY ORGANIC REVENUE GROWTH RATES (CONT'D) (Quarterly) Total Company Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth 27 % 32 % 16 % 12 % 5% 8 % 4 % 7 % 8 % Currency impact (3)% (5)% (8)% (4)% 1% 3 % 5 % 3 % 2 % Revenue growth in constant currency 24 % 27 % 8 % 8 % 6% 11 % 9 % 10 % 10 % Impact of TTM acquisitions, divestitures & JVs (12)% (16)% 3 % 3 % 2% (5)% (6)% (5)% (6)% Revenue growth in constant currency ex. TTM 12 % 11 % 11 % 11 % 8% 6 % 3 % 5 % 4 % acquisitions, divestitures & JVs 2-Year Stacked Organic Constant-Currency Q1'17+ Q2'17+ Q3'17+ Q4'17+ Q1'18+ Q2'18+ Q3'18+ Q4'18+ Q1'19+ Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Year 1 (Earlier of the 2 Stacked Periods) 6 % 8 % 11 % 9 % 12% 11 % 11 % 11 % 8 % Year 2 (More Recent of the 2 Stacked Periods) 12 % 11 % 11 % 11 % 8% 6 % 3 % 5 % 4 % Year 1 + Year 2 18 % 19 % 22 % 20 % 20% 17 % 14 % 16 % 12 % Note: Total company revenue growth in constant currency excluding TTM acquisitions, divestitures and joint ventures for all periods excludes the impact of currency. The organic constant-currency growth rate excludes Albumprinter revenue from Q1 FY2017 through Q1 FY2018, Digipri (the part of our Japan business that we previously sold) revenue, for Q2 FY2018, and VIDA and BuildASign revenue for all periods. Vistaprint Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth 11 % 12 % 11 % 11 % 6% 1% (2)% (2)% (1)% Currency impact (1)% (3)% (4)% (2)% 1% 2% 3 % 2 % 2 % Revenue growth in constant currency 10 % 9 % 7 % 9 % 7% 3% 1 % — % 1 % Impact of TTM acquisitions, divestitures & JVs — % — % — % — % —% —% — % — % — % Revenue growth in constant currency ex. TTM 10 % 9 % 7 % 9 % 7% 3% 1 % — % 1 % acquisitions, divestitures & JVs 2-Year Stacked Organic Constant-Currency Q1'18+ Q2'18+ Q3'18+ Q4'18+ Q1'19+ Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Year 1 (Earlier of the 2 Stacked Periods) 10% 9% 7 % 9 % 7 % Year 2 (More Recent of the 2 Stacked Periods) 7% 3% 1 % — % 1 % Year 1 + Year 2 17% 12% 8 % 9 % 8 % Values may not sum to total due to rounding. Page 28 of 34
TWO-YEAR STACKED CONSTANT-CURRENCY ORGANIC REVENUE GROWTH RATES (CONT'D) (Quarterly) PrintBrothers Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth 26 % 30 % 35 % 26 % 10% 8% 5% 8% 8% Currency impact (6)% (11)% (18)% (10)% 2% 4% 9% 7% 5% Revenue growth in constant currency 20 % 19 % 17 % 16 % 12% 12% 14% 15% 13% Impact of TTM acquisitions, divestitures & JVs — % — % — % — % —% —% —% —% —% Revenue growth in constant currency ex. TTM 20 % 19 % 17 % 16 % 12% 12% 14% 15% 13% acquisitions, divestitures & JVs 2-Year Stacked Organic Constant-Currency Q1'18+ Q2'18+ Q3'18+ Q4'18+ Q1'19+ Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Year 1 (Earlier of the 2 Stacked Periods) 20% 19% 17% 16% 12% Year 2 (More Recent of the 2 Stacked Periods) 12% 12% 14% 15% 13% Year 1 + Year 2 32% 31% 31% 31% 25% The Print Group Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Reported revenue growth 16 % 23 % 23 % 13 % 4% 3% (2)% 3% 2% Currency impact (5)% (10)% (16)% (9)% 1% 3% 8 % 6% 5% Revenue growth in constant currency 11 % 13 % 7 % 4 % 5% 6% 6 % 9% 7% Impact of TTM acquisitions, divestitures & JVs — % — % — % — % —% —% — % —% —% Revenue growth in constant currency ex. TTM 11 % 13 % 7 % 4 % 5% 6% 6 % 9% 7% acquisitions, divestitures & JVs 2-Year Stacked Organic Constant-Currency Q1'18+ Q2'18+ Q3'18+ Q4'18+ Q1'19+ Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Year 1 (Earlier of the 2 Stacked Periods) 11% 13% 7 % 4% 5% Year 2 (More Recent of the 2 Stacked Periods) 5% 6% 6 % 9% 7% Year 1 + Year 2 16% 19% 13 % 13% 12% GROSS PROFIT AND CONTRIBUTION PROFIT (Quarterly, in millions except percentages) Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Total revenue $563.3 $762.1 $636.1 $631.1 $589.0 $825.6 $661.8 $674.7 $634.0 Cost of revenue $283.8 $360.3 $319.2 $316.6 $302.5 $411.5 $342.7 $344.7 $325.7 Gross profit (revenue minus cost of revenue) $279.5 $401.8 $316.9 $314.6 $286.5 $414.1 $319.1 $330.0 $308.3 as a percent of total revenue 49.6% 52.7% 49.8% 49.8% 48.6% 50.2% 48.2% 48.9% 48.6% Advertising expense and payment processing fees $105.0 $140.8 $118.5 $108.8 $123.4 $147.8 $108.7 $91.5 $103.5 Contribution profit (gross profit minus $174.5 $261.0 $198.4 $205.7 $163.2 $266.3 $210.4 $238.5 $204.8 advertising/processing fees) as a percent of total revenue 31.0% 34.3% 31.2% 32.6% 27.7% 32.3% 31.8% 35.4% 32.3% Values may not sum to total due to rounding. Page 29 of 34
EBITDA (LOSS) BY REPORTABLE SEGMENT ("SEGMENT EBITDA") (Quarterly, in millions) Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Vistaprint $ 41.8 $ 111.0 $ 70.4 $ 68.1 $ 60.0 $ 97.0 $ 82.6 $ 88.0 $ 80.6 PrintBrothers 8.5 12.0 9.1 11.6 10.6 11.7 8.1 13.1 10.8 The Print Group 12.2 16.8 15.0 19.5 11.8 16.4 15.7 20.1 13.6 National Pen 2.7 19.4 2.1 5.2 (16.5) 26.6 0.1 7.0 (9.9) All Other Businesses (0.3) (3.0) (3.4) (3.8) (4.7) (2.3) (1.1) 1.8 1.7 Total segment EBITDA (loss) $ 64.9 $ 156.1 $ 93.3 $ 100.5 $ 61.2 $ 149.4 $ 105.3 $ 130.1 $ 96.9 Central and corporate costs ex. unallocated (23.1) (22.9) (24.0) (24.3) (25.2) (24.3) (25.6) (23.8) (27.4) SBC Unallocated SBC (2.1) (7.5) (8.6) (7.0) (4.1) 11.1 (0.2) (3.1) 0.5 Exclude: share-based compensation included in 6.8 11.8 12.8 11.0 8.9 (5.6) 4.5 7.6 4.8 segment EBITDA Include: Realized gains (losses) on certain currency derivatives not included in segment (0.6) (3.5) (4.8) (2.5) 1.6 7.4 4.8 6.4 4.8 EBITDA Adjusted EBITDA $ 45.8 $ 134.0 $ 68.7 $ 77.6 $ 42.5 $ 138.1 $ 88.9 $ 117.2 $ 79.5 Depreciation and amortization (42.4) (41.3) (43.4) (41.9) (40.7) (44.5) (44.1) (43.7) (42.5) Waltham, MA lease depreciation adjustment1 1.0 1.0 1.0 1.0 1.0 1.0 1.0 1.0 — Proceeds from insurance — (0.4) (0.3) — — — — — — Earn-out related charges (1.1) (1.3) — — — — — — — Share-based compensation expense2 (6.8) (12.8) (12.8) (16.7) (8.9) 2.7 (4.5) (7.6) (4.8) Certain impairments and other adjustments — (0.5) (0.9) (1.5) 0.1 (0.1) (0.8) (9.9) 0.2 Restructuring-related charges (0.9) (11.5) (2.3) (0.6) (0.2) (1.0) (7.9) (3.0) (2.2) Interest expense for Waltham, MA lease1 1.9 1.9 1.8 1.8 1.8 1.8 1.8 1.8 — Gain on purchase or sale of subsidiaries3 48.4 — — (0.4) — — — — — Realized (gains) losses on currency derivatives 0.6 3.5 4.8 2.5 (1.6) (7.4) (4.8) (6.4) (4.8) not included in operating income Total income from operations $ 46.6 $ 72.7 $ 16.6 $ 21.9 $ (6.0) $ 90.6 $ 29.6 $ 49.4 $ 25.4 Operating income margin 8% 10% 3% 3% (1)% 11% 4% 7% 4% Operating income year-over-year growth 268% 116% 140% 326% (113)% 25% 78% 126% 524% 1 During Q1 FY2020, we adopted the new lease accounting standard, ASC 842. Our Waltham, MA lease, which was previously classified as build- to-suit, is now classified as an operating lease under the new standard. The Waltham depreciation and interest expense adjustments that were made in comparative periods are no longer made beginning in FY2020, as any impact from the Waltham lease is reflected in operating income. 2 Includes expense recognized for the change in fair value of contingent consideration and compensation expense related to earn-out mechanisms dependent upon continued employment. 3Includes the impact of the gain on the sale of Albumprinter, as well as a bargain purchase gain as defined by ASC 805-30 for an acquisition in which the identifiable assets acquired and liabilities assumed are greater than the consideration transferred, that was recognized in general and administrative expense in our consolidated statement of operations during the three months ended September 30, 2017. Values may not sum to total due to rounding. Page 30 of 34
ADJUSTED EBITDA (Quarterly, in millions) Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 GAAP operating income (loss) $46.6 $72.7 $16.6 $21.9 ($6.0) $90.6 $29.6 $49.4 $25.4 Depreciation and amortization $42.4 $41.3 $43.4 $41.9 $40.7 $44.5 $44.1 $43.7 $42.5 Waltham, MA lease depreciation adjustment ($1.0) ($1.0) ($1.0) ($1.0) ($1.0) ($1.0) ($1.0) ($1.0) $— Share-based compensation expense1 $6.8 $12.8 $12.8 $16.7 $8.9 ($2.7) $4.5 $7.6 $4.8 Proceeds from insurance $— $0.4 $0.3 $— $— $— $— $— $— Interest expense associated with Waltham, MA ($1.9) ($1.9) ($1.8) ($1.8) ($1.8) ($1.8) ($1.8) ($1.8) $— lease Earn-out related charges $1.1 $1.3 $— $— $— $— $— $— $— Certain impairments and other adjustments $— $0.5 $0.9 $1.5 ($0.1) $0.1 $0.8 $9.9 ($0.2) Gain on purchase or sale of subsidiaries ($48.4) $— $— $0.4 $— $— $— $— $— Restructuring related charges $0.9 $11.5 $2.3 $0.6 $0.2 $1.0 $7.9 $3.0 $2.2 Realized gains (losses) on currency derivatives ($0.6) ($3.5) ($4.8) ($2.5) $1.6 $7.4 $4.8 $6.4 $4.8 not included in operating income Adjusted EBITDA2,3 $45.8 $134.0 $68.7 $77.6 $42.5 $138.1 $88.9 $117.2 $79.5 ADJUSTED EBITDA (TTM, in millions) TTM TTM TTM TTM TTM TTM TTM TTM TTM Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 GAAP operating income (loss) $28.7 $67.7 $126.3 $157.8 $105.2 $123.1 $136.1 $163.6 $195.0 Depreciation and amortization $166.5 $170.8 $169.7 $169.0 $167.3 $170.5 $171.2 $173.0 $174.8 Waltham, MA lease depreciation adjustment ($4.1) ($4.1) ($4.1) ($4.1) ($4.1) ($4.1) ($4.1) ($4.1) ($3.1) Share-based compensation expense1 $37.6 $39.1 $45.4 $49.1 $51.2 $35.7 $27.4 $18.3 $14.1 Proceeds from insurance $0.2 $0.5 $0.7 $0.7 $0.7 $0.3 $— $— $— Interest expense associated with Waltham, MA ($7.7) ($7.6) ($7.5) ($7.5) ($7.4) ($7.4) ($7.3) ($7.2) ($5.4) lease Earn-out related charges $25.3 $19.5 $14.6 $2.4 $1.3 $— $— $— $— Certain impairments and other adjustments $9.6 $10.1 $1.4 $2.9 $2.8 $2.4 $2.3 $10.7 $10.6 Gain on purchase or sale of subsidiaries ($48.4) ($48.4) ($48.4) ($47.9) $0.4 $0.4 $0.4 $— $— Restructuring related charges $27.6 $38.0 $15.5 $15.2 $14.6 $4.1 $9.6 $12.1 $14.1 Realized gains (losses) on currency derivatives $14.0 $3.6 ($5.8) ($11.4) ($9.2) $1.8 $11.4 $20.3 $23.5 not included in operating income Adjusted EBITDA2,3 $249.2 $289.2 $307.7 $326.1 $322.8 $326.8 $347.0 $386.5 $423.6 1SBC expense listed here excludes the portion included in restructuring-related charges to avoid double counting. 2This letter uses the definition of adjusted EBITDA as outlined above and therefore does not include the pro-forma impact of acquisitions or divestitures; however, our debt covenants allow for the inclusion of pro-forma impacts to adjusted EBITDA. 3Adjusted EBITDA includes 100% of the results of our consolidated subsidiaries and therefore does not give effect to adjusted EBITDA attributable to noncontrolling interests. This is to most closely align to our debt covenant and cash flow reporting. Values may not sum to total due to rounding. Page 31 of 34
ADJUSTED FREE CASH FLOW (Quarterly, in millions) Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Net cash provided by operating activities $16.4 $160.4 ($32.1) $47.7 $22.2 $183.3 $17.0 $108.6 $62.9 Purchases of property, plant and equipment ($20.5) ($18.2) ($8.8) ($13.5) ($21.0) ($17.7) ($19.2) ($12.6) ($14.2) Purchases of intangible assets not related to $— ($0.3) $— $— $— $— $— $— $— acquisitions Capitalization of software and website ($8.9) ($9.2) ($11.4) ($11.4) ($11.2) ($10.7) ($12.7) ($14.0) ($12.5) development costs Payment of contingent earn-out liabilities $— $— $49.2 $— $— $— $— $— $— Adjusted free cash flow ($13.0) $132.7 ($3.0) $22.8 ($10.1) $154.8 ($14.9) $81.9 $36.2 Reference: Value of capital leases $— $0.1 $0.4 $— $3.6 $3.7 $4.4 $0.3 $— Cash restructuring payments $4.1 $6.8 $4.2 $2.2 $1.2 $0.4 $3.1 $1.3 $2.3 Cash paid during the period for interest $8.4 $17.4 $8.0 $22.8 $7.5 $22.3 $10.1 $24.1 $9.4 Interest expense for Waltham, MA Lease ($1.9) ($1.9) ($1.8) ($1.8) ($1.8) ($1.8) ($1.8) ($1.8) $— Cash interest related to borrowing $6.5 $15.5 $6.2 $20.9 $5.7 $20.4 $8.3 $22.3 $9.4 ADJUSTED FREE CASH FLOW (TTM, in millions) TTM TTM TTM TTM TTM TTM TTM TTM TTM Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Net cash provided by operating activities $163.5 $218.8 $177.7 $192.3 $198.2 $221.1 $270.2 $331.1 $371.8 Purchases of property, plant and equipment ($75.3) ($76.6) ($64.7) ($60.9) ($61.5) ($61.0) ($71.4) ($70.6) ($63.7) Purchases of intangible assets not related to ($0.2) ($0.4) ($0.4) ($0.3) ($0.3) ($0.1) $— ($0.1) $— acquisitions Capitalization of software and website ($37.9) ($36.3) ($38.1) ($40.8) ($43.1) ($44.7) ($46.0) ($48.7) ($49.9) development costs Payment of contingent earn-out liabilities $— $— $49.2 $49.2 $49.2 $49.2 $— $— $— Adjusted free cash flow $50.1 $105.6 $123.8 $139.5 $142.5 $164.6 $152.7 $211.8 $258.1 Reference: Value of capital leases $12.3 $9.6 $2.9 $0.5 $4.1 $7.6 $11.6 $11.9 $8.3 Cash restructuring payments $19.1 $25.9 $22.6 $17.3 $14.5 $8.1 $7.0 $6.0 $7.1 Cash paid during the period for interest $48.3 $51.0 $51.7 $56.6 $55.7 $60.6 $62.6 $63.9 $65.8 Interest expense for Waltham, MA Lease ($7.7) ($7.6) ($7.5) ($7.5) ($7.4) ($7.4) ($7.3) ($7.2) ($5.4) Cash interest related to borrowing $40.7 $43.4 $44.2 $49.1 $48.3 $53.2 $55.3 $56.7 $60.4 Values may not sum to total due to rounding. Page 32 of 34
INTEREST EXPENSE RELATED TO BORROWING (P&L VIEW) (Quarterly, in millions) Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 P&L view of interest expense $13.1 $12.5 $12.7 $14.8 $13.8 $16.8 $16.8 $15.8 $15.1 Less: Interest expense associated with ) ) ) ) ) ) ) ) Waltham, MA Lease ($1.9 ($1.9 ($1.8 ($1.8 ($1.8 ($1.8 ($1.8 ($1.8 $— Less: Interest expense related to ) ) ) ) investment consideration $— ($0.4 ($0.1 ($1.6 $— ($0.8 $— $— $— Interest expense related to borrowing $11.2 $10.2 $10.7 $11.3 $11.9 $14.2 $15.0 $14.0 $15.1 RETURN ON INVESTED CAPITAL (TTM, in millions except percentages) Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Total Debt $820.8 $700.5 $812.6 $826.8 $863.6 $1,048.4 $1,075.1 $1,023.6 $1,227.8 Redeemable Noncontrolling Interest $83.8 $85.5 $87.8 $86.2 $91.4 $53.4 $52.4 $63.2 $65.5 Total Shareholders' Equity $84.5 $119.7 $93.6 $93.9 $82.1 $128.2 $128.9 $131.8 ($75.6) Excess Cash¹ $— $— $— $— $— $— $— $— $— Invested Capital² $989.1 $905.7 $994.0 $1,006.9 $1,037.2 $1,230.0 $1,256.4 $1,218.6 $1,217.7 Average Invested Capital³ $1,005.7 $977.7 $971.5 $974.0 $986.0 $1,067.0 $1,132.6 $1,185.5 $1,230.7 TTM TTM TTM TTM TTM TTM TTM TTM TTM Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Adjusted EBITDA $249.2 $289.2 $307.7 $326.1 $322.8 $326.8 $347.0 $386.5 $423.6 Depreciation and amortization ($166.5) ($170.8) ($169.7) ($169.0) ($167.3) ($170.5) ($171.2) ($173.0) ($174.8) Waltham, MA lease depreciation adjustment $4.1 $4.1 $4.1 $4.1 $4.1 $4.1 $4.1 $4.1 $3.1 Amortization of acquired intangible assets adjustment $48.6 $51.2 $50.7 $49.9 $48.5 $50.8 $51.9 $53.3 $55.0 Share-based compensation ex. restructuring and investment ($32.0) ($33.2) ($39.8) ($42.3) ($44.5) ($27.1) ($18.8) ($15.4) ($11.2) consideration Cash taxes paid in the current ) ) ) ) ) ) ) ) ) period ($46.2 ($39.5 ($31.3 ($32.3 ($32.4 ($32.8 ($30.5 ($26.3 ($25.4 Adjusted NOPAT $57.1 $101.1 $121.8 $136.5 $131.2 $151.4 $182.6 $229.2 $270.3 Average Invested Capital3 (from above) $1,005.7 $977.7 $971.5 $974.0 $986.0 $1,067.0 $1,132.6 $1,185.5 $1,230.7 TTM Adjusted ROIC 6% 10% 13% 14% 13% 14% 16% 19% 22% Adjusted NOPAT (from above) $57.1 $101.1 $121.8 $136.5 $131.2 $151.4 $182.6 $229.2 $270.3 Add back: SBC excluding investment consideration and $32.0 $33.2 $39.8 $42.3 $44.5 $27.1 $18.8 $15.4 $11.2 restructuring4 TTM Adjusted NOPAT excluding SBC $89.2 $134.3 $161.6 $178.9 $175.7 $178.4 $201.4 $244.6 $281.5 Average Invested Capital3 (from above) $1,005.7 $977.7 $971.5 $974.0 $986.0 $1,067.0 $1,132.6 $1,185.5 $1,230.7 TTM Adjusted ROIC excluding 9% 14% 17% 18% 18% 17% 18% 21% 23% SBC 1Excess cash is cash and equivalents > 5% of last twelve month revenues; if negative, capped at zero. 2,3Average invested capital represents a four quarter average of total debt, redeemable noncontrolling interests and total shareholder equity, less excess cash. 4Adjusted EBITDA excludes all SBC. We show adjusted NOPAT for the purposes of the ROIC calculation including SBC not related to investment consideration and restructuring, and also without. Values may not sum to total due to rounding. Page 33 of 34
ABOUT CIMPRESS: Cimpress N.V. (Nasdaq: CMPR) invests in and builds customer-focused, entrepreneurial, mass-customization businesses for the long term. Mass customization is a competitive strategy which seeks to produce goods and services to meet individual customer needs with near mass production efficiency. Cimpress businesses include BuildASign, Drukwerkdeal, Exaprint, National Pen, Pixartprinting, Printi, Vistaprint and WIRmachenDRUCK. To learn more, visit http://www.cimpress.com. Cimpress and the Cimpress logo are trademarks of Cimpress N.V. or its subsidiaries. All other brand and product names appearing on this announcement may be trademarks or registered trademarks of their respective holders. CONTACT INFORMATION: Investor Relations: Media Relations: Meredith Burns Paul McKinlay ir@cimpress.com mediarelations@cimpress.com +1.781.652.6480 SAFE HARBOR STATEMENT: This earnings commentary contains statements about our 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 our expectations for the growth and development of our businesses, revenues, and profits; the development and anticipated benefits of a new e-commerce platform and free shipping offers in our Vistaprint business; our expectations for our Printi business; the anticipated competitive position of certain of our businesses in Europe; the development and anticipated benefits to our businesses of our mass customization platform; our planned merger to change our jurisdiction of incorporation from the Netherlands to Ireland; and the expected timing and impacts of Swiss tax reform. Forward-looking projections and expectations are inherently uncertain, are based on assumptions and judgments by management, and may turn out to be wrong. If we fail to satisfy the conditions to the closing of our merger to Ireland, then the merger may be delayed or may not close at all. Our actual results may differ materially from those indicated by the forward-looking statements in this document as a result of various important factors, including but not limited to flaws in the assumptions and judgments upon which our forecasts and estimates are based; our failure to execute our strategy; our inability to make the investments in our business that we plan to make or the failure of those investments to achieve the results we expect; our failure to address performance issues in some of our businesses; the failure of the businesses we acquire or invest in to perform as expected; our failure to develop and deploy our mass customization platform or the Vistaprint e-commerce platform or the failure of either platform to drive the performance, efficiencies, and competitive advantage we expect; loss of key personnel or our inability to recruit talented personnel to drive performance of our businesses; unanticipated changes in our markets, customers, or businesses; changes in the laws and regulations, or in the interpretation of laws and regulations, that affect our businesses, including changes in the timing of or regulations included in Swiss tax reform; competitive pressures; general economic conditions; and other factors described in our Form 10-K for the fiscal year ended June 30, 2019 and the other documents we periodically file with the U.S. SEC. In addition, the statements and projections in this quarterly earnings document represent our expectations and beliefs as of the date of this document, and subsequent events and developments may cause these expectations, beliefs, and projections to change. We specifically disclaim any 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 document. Page 34 of 34