Cimpress Reports Fourth Quarter and Fiscal Year 2017 Financial Results
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Fourth quarter 2017 results:
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Revenue grew 18 percent year over year to
$564.3 million - Revenue grew 9 percent year over year excluding the impact of currency exchange rate fluctuations and revenue from businesses acquired during the past twelve months
-
GAAP loss from operations was
$9.7 million in the current period versus income from operations of$16.0 million in the year-ago period, largely due to acquisition-related charges and planned increases in investments, partially offset by restructuring savings -
GAAP net loss per diluted share was
$1.11 in the fourth quarter of 2017 versus GAAP net income per diluted share of$0.51 in the year-ago period due to the items above as well as significant non-cash currency-related losses -
Adjusted net operating profit after tax (adjusted NOPAT) was
$9.6 million versus$16.9 million in the year-ago period
-
Revenue grew 18 percent year over year to
-
Fiscal year 2017 results:
-
Revenue grew 19 percent year over year to
$2,135.4 million - Revenue grew 8 percent year over year excluding the impact of currency exchange rate fluctuations and revenue from businesses acquired during the past twelve months
-
GAAP loss from operations was
$45.7 million in the current fiscal year versus GAAP income from operations of$78.2 million in the year-ago period, primarily due to planned increases in investments, acquisition-related charges, previously announced loss of certain partner profits, net restructuring costs, and unfavorable currency impacts, partially offset by reduced impairment charges -
GAAP net loss per diluted share was
$2.29 in fiscal 2017 versus GAAP net income per diluted share of$1.64 in the year-ago period due to the operating items above, and significant year-over-year changes in non-operational currency impacts, partially offset by a GAAP tax benefit -
Adjusted net operating profit after tax (adjusted NOPAT) was
$64.6 million versus$139.8 million in the year-ago period
-
Revenue grew 19 percent year over year to
VENLO,
"Fiscal year 2017 was important in terms of the evolution of
The following year-over-year items negatively influenced GAAP operating income in the fourth quarter and full year:
-
Increased organic investments in fiscal year 2017 compared to fiscal
year 2016, which materially weigh on profitability. These investments
include costs that impact our gross profit such as shipping price
reductions, expanded design services, and new product introductions.
For the full year, the increase in organic investments impacted
operating income by approximately
$45 million . -
Restructuring charges related to the reorganization announced on
January 25, 2017 . The year-over-year increase was$0.8 million for the fourth quarter and$26.3 million for the full year. In our full-year results, the savings we realized from the restructuring partially offset the restructuring charges. -
A year-over-year increase in acquisition-related charges as follows:
First, earn-out related charges primarily associated with the prior
year acquisition of WIRmachenDRUCK of
$10.5 million for the fourth quarter and$34.0 million for the full year. This increase brings the fair value of the earn-out to the maximum amount of €40 million, with a small time-based discount. Second, an increase in acquisition-related amortization of intangible assets of$2.2 million for the quarter and$5.6 million for the year. Third, the acceleration of the vesting of equity awards from two unrelated acquisition-related employment contracts led to a year-over-year increase in share-based compensation costs of$3.4 million in the fourth quarter and$4.8 million for the full-year. The full-year acquisition-related impacts are partially offset by a year-over-year decrease in impairment charges of$21.3 million related to acquisitions. -
An increase in share-based compensation expense due to the
implementation of our previously described long-term incentive program
at the beginning of fiscal year 2017. The year-over-year increase was
$3.9 million for the fourth quarter and$13.7 million for the full year, excluding share-based compensation related to restructuring and acquisition-related investment consideration, which are included in the respective impacts listed above. -
A profit decline due to the termination of two partner contracts as
previously described. The year-over-year impact of this was
approximately
$1 million for the fourth quarter, and$18 million for the full year. - Unfavorable year-over-year currency fluctuations that were offset below the line by year-over-year changes in realized gains from hedging contracts in other income, net.
Quinn added, "Including the currency impact, the items listed above
weigh on our operating income by over
For fiscal year 2018,
Quinn added, "As we look ahead to fiscal year 2018, we are on track to
recognize the financial benefits of our recent restructuring in line
with our past commentary. Our businesses are focused on delivering
strong returns from past investment spend and, as outlined in detail in
our letter to investors dated
Anticipated Sale of Albumprinter Business:
Consolidated Financial Metrics:
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Revenue for the fourth quarter of fiscal year 2017 was
$564.3 million , an 18 percent increase compared to revenue of$479.2 million in the same quarter a year ago. Excluding the estimated impact from currency exchange rate fluctuations and revenue from businesses acquired during the past twelve months, revenue grew 9 percent year over year in the fourth quarter. For the full year, total consolidated revenue grew 19 percent year over year. Excluding the estimated impact from currency exchange rate fluctuations and revenue from businesses acquired during the past twelve months, revenue for the full year grew 8 percent. Revenue growth for the fourth quarter, and even more so for the full year, was negatively impacted by the loss of certain partner revenue. These terminated partner relationships will not impact our year-over-year growth rates in future quarters because more than four quarters have now passed since the cessation of revenue from these sources. - Gross margin (revenue minus the cost of revenue as a percent of total revenue) in the fourth quarter was 50.5 percent, down from 53.7 percent in the same quarter a year ago due to lower Vistaprint gross margins as a result of planned investments, as well as unfavorable currency changes. For the full fiscal year, gross margin was 51.4 percent compared to 56.7 percent in fiscal year 2016, due to the same reasons described above for the quarter, as well as a year-over-year mix impact from recent acquisitions.
- Contribution margin (revenue minus the cost of revenue, the cost of advertising and payment processing as a percent of total revenue) in the fourth quarter was 32.9 percent, down from 36.1 percent in the same quarter a year ago. For the full fiscal year, contribution margin was 32.8 percent compared to 37.9 percent in the prior fiscal year. Advertising as a percent of revenue was flat year over year for both the fourth quarter and full year; therefore the contribution margin trend was driven by the decline in gross margin as described above.
-
GAAP operating loss in the fourth quarter was
$9.7 million , or 1.7 percent of revenue, compared to operating income of$16.0 million , or 3.3 percent of revenue, in the same quarter a year ago. GAAP operating loss for fiscal year 2017 was$45.7 million , or 2.1 percent of revenue, compared to operating income of$78.2 million , or 4.4 percent of revenue, in the prior fiscal year. The drivers of this significant loss are described above, before the "Anticipated Sale of Albumprinter Business" section of this release. -
Adjusted NOPAT for the fourth quarter, which is defined at the end of
this press release, was
$9.6 million , or 1.7 percent of revenue, down from$16.9 million , or 3.5 percent of revenue, in the same quarter a year ago. For the full fiscal year, adjusted NOPAT was$64.6 million , or 3.0 percent of revenue, down from$139.8 million , or 7.8 percent of revenue, in fiscal year 2016. The profit impacts described above that also impacted adjusted NOPAT were the increased organic investments, the increase in share-based compensation related to our new long-term incentive program, and the reduction in partner profits. Because the restructuring charges are excluded from adjusted NOPAT, there is a positive impact from restructuring savings during the quarter and year. -
GAAP net loss attributable to
Cimpress for the fourth quarter was$34.7 million , or 6.2 percent of revenue, compared to net income of$16.9 million , or 3.5 percent of revenue in the same quarter a year ago. For the full fiscal year, GAAP net loss attributable toCimpress was$71.7 million , or 3.4 percent of revenue, compared to GAAP net income of$54.3 million , or 3.0 percent of revenue, in the prior fiscal year. In addition to the impacts described above, GAAP net loss was negatively influenced by year-over-year non-operational, non-cash currency impacts, and positively influenced by a significant reduction in our tax provision in the current period compared to the year-ago period due to our consolidated losses as well as favorable discrete items during the quarter and year. -
GAAP net loss per diluted share for the fourth quarter was
$1.11 , versus net income of$0.51 in the same quarter a year ago. For fiscal year 2017, GAAP net loss per diluted share was$2.29 , versus net income per diluted share of$1.64 in the prior full fiscal year. -
Capital expenditures in the fourth quarter were
$17.2 million , or 3.1 percent of revenue, versus$17.8 million , or 3.7 percent of revenue in the same quarter a year ago. During the full fiscal year capital expenditures were$74.2 million or 3.5 percent of revenue, compared to$80.4 million or 4.5 percent of revenue in fiscal year 2016. -
During the fourth quarter, the company generated
$33.1 million of cash from operations and$7.1 million in free cash flow, a non-GAAP financial measure, which is defined at the end of this press release. During the full fiscal year, the company generated$156.7 million of cash from operations and$45.1 million in free cash flow. -
As of
June 30, 2017 , the company had$37.7 million of cash and cash equivalents (including$12.0 million of cash held for sale related to the planned Albumprinter divestiture) and$876.7 million of debt, net of issuance costs. After considering debt covenant limitations, as ofJune 30, 2017 the company had$211.8 million available for borrowing under its committed credit facility. Based onCimpress' debt covenant definitions, its total leverage ratio was 3.45 as ofJune 30, 2017 . The company continues to expect to reduce its leverage ratio approximately to, or below, its long-term target of 3 times trailing twelve month EBITDA by the end of calendar year 2017 through a combination of debt repayment and EBITDA expansion. As recently announced,Cimpress amended and increased the size of its credit facility in July for long-term flexibility. -
Cimpress did not repurchase shares during the fourth quarter. For the full year,Cimpress purchased 593,763 shares for$50.0 million inclusive of transaction costs, at an average price per share of$84.22 .
Supplemental Materials and July 27, 2017 Conference Call Information
Important Reminder of Cimpress’ Priorities
We ask investors and potential investors in
Our priorities are:
- Strategic Objective: To be the world leader in mass customization. By mass customization, we mean producing, with the reliability, quality and affordability of mass production, small individual orders where each and every one embodies the personal relevance inherent to customized physical products.
- Financial Objective: To maximize intrinsic value per share, defined as (a) the unlevered free cash flow per 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 share.
To understand these objectives and their implications,
About non-GAAP financial measures
To supplement Cimpress’ consolidated financial statements presented in
accordance with U.S. generally accepted accounting principles, or GAAP,
-
Adjusted net operating profit after tax is defined as GAAP operating
income, less cash taxes attributable to current period operations and
interest expense associated with our
Waltham, Massachusetts lease, excluding M&A related items such as acquisition-related amortization and depreciation, changes in the fair value of contingent consideration, and expense for deferred payments or equity awards that are treated as compensation expense, plus the impact of certain unusual items such as discontinued operations, restructuring charges, or impairments, plus realized gains or losses on currency derivatives that are not included in operating income. - 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.
-
Unlevered free cash flow is defined as free cash flow as described
above, plus the cash paid during the period for interest, minus the
interest expense associated with our
Waltham, Massachusetts lease. - 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.
- Fourth quarter constant-currency revenue growth excluding revenue from acquisitions made during the past twelve months excludes the impact of currency as defined above and revenue from National Pen.
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 release. The tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliation between these financial measures.
About
This press release 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 business, cash flows, and revenue, the
expected savings from our recent organizational changes, and the
expected sale of our Albumprinter business. Forward-looking projections
and expectations are inherently uncertain, are based on assumptions and
judgments by management, and may turn out to be wrong. The sale of our
Albumprinter business may be delayed or may not close at all if either
In addition, the statements and projections in this press release represent our expectations and beliefs as of the date of this press release, 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 press release.
Operational Metrics & Financial Tables to Follow
CIMPRESS N.V. |
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CONSOLIDATED BALANCE SHEETS |
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(unaudited in thousands, except share and per share data) | ||||||||||
June 30, 2017 |
June 30, 2016 |
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Assets | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 25,697 | $ | 77,426 | ||||||
Marketable securities | — | 7,893 | ||||||||
Accounts receivable, net of allowances of $3,590 and $490, respectively | 48,630 | 32,327 | ||||||||
Inventory | 46,563 | 18,125 | ||||||||
Prepaid expenses and other current assets | 78,835 | 64,997 | ||||||||
Assets held for sale | 46,276 | — | ||||||||
Total current assets | 246,001 | 200,768 | ||||||||
Property, plant and equipment, net | 511,947 | 493,163 | ||||||||
Software and web site development costs, net | 48,470 | 35,212 | ||||||||
Deferred tax assets | 48,004 | 26,093 | ||||||||
Goodwill | 514,963 | 466,005 | ||||||||
Intangible assets, net | 275,924 | 216,970 | ||||||||
Other assets | 34,560 | 25,658 | ||||||||
Total assets | $ | 1,679,869 | $ | 1,463,869 | ||||||
Liabilities, noncontrolling interests and shareholders’ equity | ||||||||||
Current liabilities: | ||||||||||
Accounts payable | $ | 127,386 | $ | 86,682 | ||||||
Accrued expenses | 175,567 | 178,987 | ||||||||
Deferred revenue | 30,372 | 25,842 | ||||||||
Short-term debt | 28,926 | 21,717 | ||||||||
Other current liabilities | 78,435 | 22,635 | ||||||||
Liabilities held for sale | 8,797 | — | ||||||||
Total current liabilities | 449,483 | 335,863 | ||||||||
Deferred tax liabilities | 60,743 | 69,430 | ||||||||
Lease financing obligation | 106,606 | 110,232 | ||||||||
Long-term debt | 847,730 | 656,794 | ||||||||
Other liabilities | 94,683 | 60,173 | ||||||||
Total liabilities | 1,559,245 | 1,232,492 | ||||||||
Commitments and contingencies | ||||||||||
Redeemable noncontrolling interests | 45,412 | 65,301 | ||||||||
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 31,415,503 and 31,536,732 shares outstanding, respectively | 615 | 615 | ||||||||
Treasury shares, at cost,12,665,124 and 12,543,895 shares, respectively | (588,365 | ) | (548,549 | ) | ||||||
Additional paid-in capital | 361,376 | 335,192 | ||||||||
Retained earnings | 414,771 | 486,482 | ||||||||
Accumulated other comprehensive loss | (113,398 | ) | (108,015 | ) | ||||||
Total shareholders’ equity attributable to Cimpress N.V. | 74,999 | 165,725 | ||||||||
Noncontrolling interests | 213 | 351 | ||||||||
Total shareholders' equity | 75,212 | 166,076 | ||||||||
Total liabilities, noncontrolling interests and shareholders’ equity | $ | 1,679,869 | $ | 1,463,869 | ||||||
CIMPRESS N.V. |
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CONSOLIDATED STATEMENTS OF OPERATIONS |
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(unaudited in thousands, except share and per share data) | ||||||||||||||||||
Three Months Ended June 30, |
Year ended June 30, |
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2017 | 2016 | 2017 | 2016 | |||||||||||||||
Revenue | $ | 564,256 | $ | 479,205 | $ | 2,135,405 | $ | 1,788,044 | ||||||||||
Cost of revenue (1) |
279,077 |
222,097 | 1,036,975 | 773,640 | ||||||||||||||
Technology and development expense (1) | 64,702 | 57,546 | 243,230 | 210,080 | ||||||||||||||
Marketing and selling expense (1) | 159,622 | 133,707 | 610,932 | 508,502 | ||||||||||||||
General and administrative expense (1) | 57,098 | 39,376 | 207,569 | 145,844 | ||||||||||||||
Amortization of acquired intangibles | 12,603 | 10,449 | 46,145 | 40,563 | ||||||||||||||
Restructuring expense (1) | 810 | — | 26,700 | 381 | ||||||||||||||
Impairment of goodwill and acquired intangible assets | — | — | 9,556 | 30,841 | ||||||||||||||
(Loss) income from operations | (9,656 | ) | 16,030 | (45,702 | ) | 78,193 | ||||||||||||
Other (expense) income, net | (11,473 | ) | 18,169 | 10,362 | 26,098 | |||||||||||||
Interest expense, net | (12,858 | ) | (9,819 | ) | (43,977 | ) | (38,196 | ) | ||||||||||
(Loss) income before income taxes | (33,987 | ) | 24,380 | (79,317 | ) | 66,095 | ||||||||||||
Income tax (benefit) provision | 526 | 7,211 | (7,118 | ) | 15,684 | |||||||||||||
Net (loss) income | (34,513 | ) | 17,169 | (72,199 | ) | 50,411 | ||||||||||||
Add: Net loss (income) attributable to noncontrolling interest | (189 | ) | (239 | ) | 488 | 3,938 | ||||||||||||
Net (loss) income attributable to Cimpress N.V. | $ | (34,702 | ) | $ | 16,930 | $ | (71,711 | ) | $ | 54,349 | ||||||||
Basic net (loss) income per share attributable to Cimpress N.V. | $ | (1.11 | ) | $ | 0.54 | $ | (2.29 | ) | $ | 1.72 | ||||||||
Diluted net (loss) income per share attributable to Cimpress N.V. | $ | (1.11 | ) | $ | 0.51 | $ | (2.29 | ) | $ | 1.64 | ||||||||
Weighted average shares outstanding — basic | 31,195,625 | 31,418,823 | 31,291,581 | 31,656,234 | ||||||||||||||
Weighted average shares outstanding — diluted | 31,195,625 | 32,996,473 | 31,291,581 | 33,049,454 | ||||||||||||||
(1) Share-based compensation is allocated as follows: |
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Three Months Ended |
Year ended |
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2017 |
2016 |
2017 |
2016 |
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Cost of revenue |
$ |
80 |
$ |
15 |
$ |
289 |
$ |
72 |
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Technology and development expense |
|
2,158 |
1,534 | 8,724 |
5,892 |
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Marketing and selling expense |
|
1,315 |
368 | 4,857 | 1,591 | |||||||||||||
General and administrative expense |
|
9,429 |
3,702 | 28,500 | 16,273 | |||||||||||||
Restructuring expense |
|
— |
— | 6,257 | — |
Note: During the third quarter of fiscal 2017, we changed the presentation of amortization expense for acquired intangible assets. The expense was previously classified within each of the respective expense lines of our consolidated statement of operations and now is presented as a separate financial statement line item, "Amortization of acquired intangible assets". Prior period results have been recast to reflect this change.
Also, given the significance of our third quarter restructuring charges we are presenting these expenses as a separate financial statement line item, "Restructuring expense", in our consolidated statement of operations. Prior period results have been recast to reflect this change.
CIMPRESS N.V. | |||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||||||
(unaudited, in thousands) | |||||||||||||||||||
Three Months Ended June 30, |
Year ended June 30, |
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2017 | 2016 | 2017 | 2016 | ||||||||||||||||
Operating activities | |||||||||||||||||||
Net (loss) income | $ | (34,513 | ) | $ | 17,169 | $ | (72,199 | ) | $ | 50,411 | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||||
Depreciation and amortization | 42,616 | 35,401 | 158,400 | 131,918 | |||||||||||||||
Impairment of goodwill and acquired intangible assets | — | — | 9,556 | 30,841 | |||||||||||||||
Share-based compensation expense | 12,982 | 5,619 | 48,627 | 23,772 | |||||||||||||||
Deferred taxes | (3,509 | ) | (4,741 | ) | (41,358 | ) | (15,922 | ) | |||||||||||
Abandonment of long-lived assets | 678 | 1,216 | 2,408 | 10,979 | |||||||||||||||
Change in contingent earn-out liability | 12,013 | — | 39,377 | — | |||||||||||||||
Gain on sale of available-for-sale securities | — | — | (2,268 | ) | — | ||||||||||||||
Unrealized loss (gain) on derivatives not designated as hedging instruments included in net (loss) income | 14,974 | (9,142 | ) | 15,813 | (8,163 | ) | |||||||||||||
Payment of contingent consideration in excess of acquisition date fair value | — | (8,613 | ) | — | (8,613 | ) | |||||||||||||
Effect of exchange rate changes on monetary assets and liabilities denominated in non-functional currency | 1,525 | (6,027 | ) | (5,690 | ) | (9,199 | ) | ||||||||||||
Other non-cash items | 493 | 2,989 | 2,886 | 5,784 | |||||||||||||||
Gain on proceeds from insurance | — | — | — | (3,136 | ) | ||||||||||||||
Changes in operating assets and liabilities: | |||||||||||||||||||
Accounts receivable | 1,267 | 4,396 | 4,701 | 6,766 | |||||||||||||||
Inventory | (1,563 | ) | 1,305 | (8,699 | ) | (11 | ) | ||||||||||||
Prepaid expenses and other assets | (1,868 | ) | (3,399 | ) | 521 | (7,668 | ) | ||||||||||||
Accounts payable | 15,424 | 13,174 | 25,332 | 25,670 | |||||||||||||||
Accrued expenses and other liabilities | (27,427 | ) | 2,791 | (20,671 | ) | 13,929 | |||||||||||||
Net cash provided by operating activities | 33,092 | 52,138 | 156,736 | 247,358 | |||||||||||||||
Investing activities | |||||||||||||||||||
Purchases of property, plant and equipment | (17,241 | ) | (17,794 | ) | (74,157 | ) | (80,435 | ) | |||||||||||
Business acquisitions, net of cash acquired | — | (1,972 | ) | (204,875 | ) | (164,412 | ) | ||||||||||||
Purchases of intangible assets | (87 | ) | (23 | ) | (197 | ) | (476 | ) | |||||||||||
Capitalization of software and website development costs | (8,629 | ) | (8,140 | ) | (37,307 | ) | (26,324 | ) | |||||||||||
Proceeds from sale of available-for-sale securities | — | — | 6,346 | — | |||||||||||||||
Proceeds from the sale of assets | 282 | — | 4,513 | — | |||||||||||||||
Proceeds from insurance related to investing activities | — | — | — | 3,624 | |||||||||||||||
Other investing activities | 1,392 | 1,710 | 3,888 | 2,485 | |||||||||||||||
Net cash used in investing activities | (24,283 | ) | (26,219 | ) | (301,789 | ) | (265,538 | ) | |||||||||||
Financing activities | |||||||||||||||||||
Proceeds from borrowings of debt | 125,071 | 82,000 | 737,075 | 598,008 | |||||||||||||||
Payments of debt and debt issuance costs | (141,860 | ) | (98,501 | ) | (540,142 | ) | (430,692 | ) | |||||||||||
Payment of purchase consideration included in acquisition-date fair value | — | (2,980 | ) | (539 | ) | (7,330 | ) | ||||||||||||
Payments of withholding taxes in connection with equity awards | (3,752 | ) | (1,699 | ) | (14,568 | ) | (7,467 | ) | |||||||||||
Payments of capital lease obligations | (3,858 | ) | (3,796 | ) | (15,887 | ) | (13,933 | ) | |||||||||||
Purchase of ordinary shares | — | — | (50,008 | ) | (153,467 | ) | |||||||||||||
Purchase of noncontrolling interests | — | — | (20,230 | ) | — | ||||||||||||||
Proceeds from issuance of ordinary shares | 5,861 | 1,326 | 6,192 | 4,705 | |||||||||||||||
Capital contribution from noncontrolling interest | — | — | 1,404 | 5,141 | |||||||||||||||
Other financing activities | — | — | 1,281 | (303 | ) | ||||||||||||||
Net cash provided by (used in) financing activities | (18,538 | ) | (23,650 | ) | 104,578 | (5,338 | ) | ||||||||||||
Effect of exchange rate changes on cash and cash equivalents | 4,001 | (1,569 | ) | 788 | (2,640 | ) | |||||||||||||
Increase in cash held for sale | 12,042 | — | 12,042 | — | |||||||||||||||
Net (decrease) increase in cash and cash equivalents | (17,770 | ) | 700 | (51,729 | ) | (26,158 | ) | ||||||||||||
Cash and cash equivalents at beginning of period | 43,467 | 76,726 | 77,426 | 103,584 | |||||||||||||||
Cash and cash equivalents at end of period | $ | 25,697 | $ | 77,426 | $ | 25,697 | $ | 77,426 | |||||||||||
CIMPRESS N.V. | ||||||||||||||||||
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES | ||||||||||||||||||
(unaudited, in thousands) | ||||||||||||||||||
Three Months Ended June 30, |
Year ended June 30, |
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2017 | 2016 | 2017 | 2016 | |||||||||||||||
Adjusted net operating profit after tax reconciliation: | ||||||||||||||||||
GAAP operating (loss) income | $ | (9,656 | ) | $ | 16,030 | $ | (45,702 | ) | $ | 78,193 | ||||||||
Less: Cash taxes attributable to current year (see below) | (12,283 | ) | (12,649 | ) | (31,104 | ) | (32,236 | ) | ||||||||||
Exclude expense impact of: | ||||||||||||||||||
Acquisition-related amortization and depreciation | 12,662 | 10,518 | 46,402 | 40,834 | ||||||||||||||
Earn-out related charges¹ | 12,245 | 1,793 | 40,384 | 6,378 | ||||||||||||||
Share-based compensation related to investment consideration | 4,559 | 1,130 | 9,638 | 4,835 | ||||||||||||||
Certain impairments² | — | 1,216 | 9,556 | 41,820 | ||||||||||||||
Restructuring related charges | 810 | — | 26,700 | 381 | ||||||||||||||
Less: Interest expense associated with Waltham lease | (1,904 | ) | (1,961 | ) | (7,727 | ) | (6,287 | ) | ||||||||||
Include: Realized gains on currency derivatives not included in operating income | 3,156 | 837 | 16,474 | 5,863 | ||||||||||||||
Adjusted NOPAT3 | $ | 9,589 | $ | 16,914 | $ | 64,621 | $ | 139,781 | ||||||||||
Cash taxes paid in the current year4 | $ | 13,375 | $ | 8,661 | $ | 49,342 | $ | 19,750 | ||||||||||
Less: cash taxes received (paid) and related to prior years4 | 1,867 | (1,722 | ) | (10,319 | ) | 934 | ||||||||||||
Plus: cash taxes attributable to the current year but not yet (received) paid | (3,320 | ) | 5,316 | (5,650 | ) | 9,298 | ||||||||||||
Plus: cash impact of excess tax benefit on equity awards attributable to current year | 3,353 | 1,224 | 8,003 | 5,574 | ||||||||||||||
Less: cash tax (paid) received related to NOPAT exclusion items | 856 | — | (681 | ) | — | |||||||||||||
Less: cash taxes paid related to the transfer of IP | (3,848 | ) | (830 | ) | (9,591 | ) | (3,320 | ) | ||||||||||
Cash taxes attributable to current year | $ | 12,283 | $ | 12,649 | $ | 31,104 | $ | 32,236 | ||||||||||
¹Includes expense recognized for the change in fair value of contingent
consideration and compensation expense related to earn-out mechanisms
dependent upon continued employment.
2Includes the
impact of certain impairments of goodwill and other long-lived assets as
defined by ASC 350 - "Intangibles - Goodwill and Other".
3Adjusted
NOPAT will include the impact of discontinued operations as defined by
ASC 205-20 in periods in which they occur.
4For the
quarter and year ended
Three Months Ended June 30, |
Year ended June 30, |
|||||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||||
Free cash flow reconciliation: | ||||||||||||||||||
Net cash provided by operating activities | $ | 33,092 | $ | 52,138 | $ | 156,736 | $ | 247,358 | ||||||||||
Purchases of property, plant and equipment | (17,241 | ) | (17,794 | ) | (74,157 | ) | (80,435 | ) | ||||||||||
Purchases of intangible assets not related to acquisitions | (87 | ) | (23 | ) | (197 | ) | (476 | ) | ||||||||||
Capitalization of software and website development costs | (8,629 | ) | (8,140 | ) | (37,307 | ) | (26,324 | ) | ||||||||||
Payment of contingent consideration in excess of acquisition-date fair value | — | 8,613 | — | 8,613 | ||||||||||||||
Proceeds from insurance related to investing activities | — | — | — | 3,624 | ||||||||||||||
Free cash flow | $ | 7,135 | $ | 34,794 | $ | 45,075 | $ | 152,360 | ||||||||||
Plus: cash paid during the period for interest | 17,845 | 14,741 | 45,275 | 37,623 | ||||||||||||||
Less: interest expense for Waltham lease | (1,904 | ) | (1,961 | ) | (7,727 | ) | (6,287 | ) | ||||||||||
Unlevered free cash flow | $ | 23,076 | $ | 47,574 | $ | 82,623 | $ | 183,696 | ||||||||||
CIMPRESS N.V. | ||||||||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (CONT.) AND SEGMENT INFORMATION | ||||||||||||||||||||||
(unaudited in thousands) | ||||||||||||||||||||||
GAAP Revenue | ||||||||||||||||||||||
Three Months Ended June 30, |
Currency |
Constant- |
Impact of |
Constant- |
||||||||||||||||||
2017 | 2016 |
% |
(Favorable)/ |
Revenue |
(Favorable)/ |
Excluding |
||||||||||||||||
Revenue growth reconciliation by reportable segment: | ||||||||||||||||||||||
Vistaprint | $ | 319,195 | $ | 305,008 | 5 | % | 1 | % | 6 | % | — | % | 6 | % | ||||||||
Upload and Print | 161,792 | 146,468 | 11 | % | 3 | % | 14 | % | — | % | 14 | % | ||||||||||
National Pen | 53,884 | — | 100 | % | — | % | 100 | % | (100 | )% | — | % | ||||||||||
All Other Businesses | 29,385 | 27,729 | 6 | % | 1 | % | 7 | % | — | % | 7 | % | ||||||||||
Total revenue | $ | 564,256 | $ | 479,205 | 18 | % | 2 | % | 20 | % | (11 | )% | 9 | % | ||||||||
GAAP Revenue | |||||||||||||||||
Year ended |
Currency |
Constant- |
Impact of |
Constant- |
|||||||||||||
2017 | 2016 |
% |
(Favorable)/ |
Revenue |
(Favorable)/ |
Excluding |
|||||||||||
Revenue growth reconciliation by reportable segment: | |||||||||||||||||
Vistaprint | $ | 1,305,285 | $ | 1,217,162 | 7% | 2% | 9% | —% | 9% | ||||||||
Upload and Print | 588,613 | 432,638 | 36% | 3% | 39% | (26)% | 13% | ||||||||||
National Pen | 112,712 | — | 100% | —% | 100% | (100)% | —% | ||||||||||
All Other Businesses | 128,795 | 138,244 | (7)% | —% | (7)% | —% | (7)% | ||||||||||
Total revenue | $ | 2,135,405 | $ | 1,788,044 | 19% | 2% | 21% | (13)% | 8% | ||||||||
Three Months Ended June 30, |
Year ended June 30, |
|||||||||||||||||
Adjusted net operating profit (loss) by reportable segment: | 2017 | 2016 | 2017 | 2016 | ||||||||||||||
Vistaprint | $ | 37,149 | $ | 47,677 | $ | 165,193 | $ | 213,027 | ||||||||||
Upload and Print | 20,118 | 17,448 | 63,833 | 58,643 | ||||||||||||||
National Pen | 1,001 | — | (2,225 | ) | — | |||||||||||||
All Other Businesses | (9,222 | ) | (10,768 | ) | (30,747 | ) | (8,924 | ) | ||||||||||
Total | 49,046 | 54,357 | 196,054 | 262,746 | ||||||||||||||
Corporate and global functions | (30,330 | ) | (25,631 | ) | (116,803 | ) | (96,592 | ) | ||||||||||
Acquisition-related amortization and depreciation | (12,662 | ) | (10,518 | ) | (46,402 | ) | (40,834 | ) | ||||||||||
Earn-out related charges¹ | (12,245 | ) | (1,793 | ) | (40,384 | ) | (6,378 | ) | ||||||||||
Share-based compensation related to investment consideration | (4,559 | ) | (1,130 | ) | (9,638 | ) | (4,835 | ) | ||||||||||
Certain impairments | — | (1,216 | ) | (9,556 | ) | (41,820 | ) | |||||||||||
Restructuring related charges | (810 | ) | — | (26,700 | ) | (381 | ) | |||||||||||
Interest expense for Waltham lease | 1,904 | 1,961 | 7,727 | 6,287 | ||||||||||||||
Total (loss) income from operations | $ | (9,656 | ) | $ | 16,030 | $ | (45,702 | ) | $ | 78,193 | ||||||||
¹Includes expense recognized for the change in fair value of contingent consideration and compensation expense related to earn-out mechanisms dependent upon continued employment.
Note: As part of the reorganization announced in
During the fourth quarter of fiscal 2017, we identified errors related
to our unaudited segment profitability disclosures that were recast and
reported during the third quarter of fiscal 2017. As part of this
process we transferred, in error, certain costs from our Corporate and
global functions cost center to our Vistaprint segment. This resulted in
the understatement of Vistaprint's adjusted net operating profit of
CIMPRESS N.V. | |||||||||||||||||||||||||||
Supplemental Information | |||||||||||||||||||||||||||
(unaudited, in thousands) | |||||||||||||||||||||||||||
In $ millions, except where noted |
Q2 |
Q3 |
Q4 |
FY2016 |
Q1 |
Q2 |
Q3 |
Q4 |
FY2017 | ||||||||||||||||||
Revenue - Consolidated as Reported | $496.3 | $436.8 | $479.2 | $1,788.0 | $443.7 | $576.9 | $550.6 | $564.3 | $2,135.4 | ||||||||||||||||||
y/y growth | 13 | % | 29 | % | 26 | % | 20 | % | 18 | % | 16 | % | 26 | % | 18 | % | 19 | % | |||||||||
y/y growth in constant currency | 20 | % | 31 | % | 26 | % | 24 | % | 19 | % | 18 | % | 28 | % | 20 | % | 21 | % | |||||||||
Vistaprint (1) | $354.8 | $289.9 | $305.0 | $1,217.2 | $285.4 | $379.4 | $321.3 | $319.2 | $1,305.3 | ||||||||||||||||||
y/y growth | 3 | % | 8 | % | 11 | % | 6 | % | 7 | % | 7 | % | 11 | % | 5 | % | 7 | % | |||||||||
y/y growth in constant currency | 8 | % | 10 | % | 12 | % | 10 | % | 8 | % | 9 | % | 12 | % | 6 | % | 9 | % | |||||||||
as % of revenue | 71 | % | 66 | % | 64 | % | 68 | % | 64 | % | 66 | % | 58 | % | 57 | % | 61 | % | |||||||||
Upload and Print | $93.3 | $116.4 | $146.5 | $432.6 | $132.0 | $152.4 | $142.5 | $161.8 | $588.6 | ||||||||||||||||||
y/y growth | 112 | % | 201 | % | 94 | % | 120 | % | 72 | % | 63 | % | 22 | % | 11 | % | 36 | % | |||||||||
y/y growth in constant currency | 128 | % | 203 | % | 92 | % | 127 | % | 73 | % | 66 | % | 27 | % | 14 | % | 39 | % | |||||||||
as % of revenue | 19 | % | 27 | % | 30 | % | 24 | % | 30 | % | 26 | % | 26 | % | 29 | % | 28 | % | |||||||||
National Pen | N/A | N/A | N/A | N/A | N/A | N/A | $58.8 | $53.9 | $112.7 | ||||||||||||||||||
y/y growth | N/A | N/A | N/A | N/A | N/A | N/A | 100 | % | 100 | % | 100 | % | |||||||||||||||
y/y growth in constant currency | N/A | N/A | N/A | N/A | N/A | N/A | 100 | % | 100 | % | 100 | % | |||||||||||||||
as % of revenue | N/A | N/A | N/A | N/A | N/A | N/A | 11 | % | 10 | % | 5 | % | |||||||||||||||
All Other Businesses (1) | $48.2 | $30.6 | $27.7 | $138.2 | $26.3 | $45.0 | $28.0 | $29.4 | $128.8 | ||||||||||||||||||
y/y growth | (4 | )% | (7 | )% | (8 | )% | (6 | )% | (17 | )% | (7 | )% | (8 | )% | 6 | % | (7 | )% | |||||||||
y/y growth in constant currency | 8 | % | (3 | )% | (8 | )% | 2 | % | (19 | )% | (7 | )% | (9 | )% | 7 | % | (7 | )% | |||||||||
as % of revenue | 10 | % | 7 | % | 6 | % | 8 | % | 6 | % | 8 | % | 5 | % | 5 | % | 6 | % | |||||||||
Physical printed products and other | $480.2 | $421.4 | $464.0 | $1,724.6 | $428.7 | $562.2 | $536.0 | $549.7 | $2,076.6 | ||||||||||||||||||
Digital products/services | $16.1 | $15.4 | $15.2 | $63.4 | $15.0 | $14.6 | $14.6 | $14.6 | $58.8 | ||||||||||||||||||
Advertising & commissions expense - consolidated | $85.0 | $74.3 | $76.4 | $305.9 | $78.3 | $94.1 | $100.4 | $91.1 | $363.9 | ||||||||||||||||||
as % of revenue | 17 | % | 17 | % | 16 | % | 17 | % | 18 | % | 16 | % | 18 | % | 16 | % | 17 | % | |||||||||
TTM Bookings - Vistaprint (1) | |||||||||||||||||||||||||||
% TTM Bookings from repeat orders (1) | 74 | % | 74 | % | 74 | % | 75 | % | 75 | % | 75 | % | 76 | % | |||||||||||||
% TTM Bookings from first-time orders (1) | 26 | % | 26 | % | 26 | % | 25 | % | 25 | % | 25 | % | 24 | % | |||||||||||||
Advertising & commissions expense - Vistaprint | $73.3 | $64.5 | $65.3 | $265.5 | $68.6 | $79.6 | $73.1 | $68.8 | $290.1 | ||||||||||||||||||
as % of revenue | 21 | % | 22 | % | 21 | % | 22 | % | 24 | % | 21 | % | 23 | % | 22 | % | 22 | % | |||||||||
Headcount at end of period | 7,463 | 7,585 | 7,995 | 8,522 | 11,312 | 10,909 | 11,639 | ||||||||||||||||||||
Full-time employees | 6,845 | 7,226 | 7,468 | 8,066 | 9,923 | 10,323 | 10,704 | ||||||||||||||||||||
Temporary employees | 618 | 359 | 527 | 456 | 1,389 | 586 | 935 | ||||||||||||||||||||
Some numbers may not add due to rounding. Metrics are unaudited.
(1) In Q2 2016, revenue and TTM bookings from the Corporate Solutions business was recast to reflect a change in the calculation approach, resulting in an immaterial change to historical revenue for the Vistaprint and All Other Businesses reportable segments, as well as TTM bookings from repeat and first-time orders.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170726006186/en/
Source:
Cimpress N.V.
Investor Relations:
Jenna Berg,
+1-781-652-6480
ir@cimpress.com
or
Media
Relations:
Paul McKinlay
mediarelations@cimpress.com