VistaPrint Reports First Quarter Fiscal 2006 Financial Results
Revenue Increased 62 Percent to $28.9 Million; Net Income Improved to 10% of Revenues; New Canadian Production Facility Comes On Line
Hamilton, Bermuda - October 25, 2005 - (BUSINESS WIRE)-VistaPrint Limited (Nasdaq:VPRT), the leading online supplier of high-quality graphic design services and customized printed products to small businesses and consumers, today announced the financial results for the quarter ended September 30, 2005, the first quarter of VistaPrint's fiscal year 2006.
Total company revenue for the quarter was $28.9 million, an increase of 62 percent versus $17.9 million for the same quarter of fiscal 2005. Revenue growth was driven by increases in small business products such as business cards, marketing postcards and brochures as well as a continued expansion in consumer products such as invitations and birth announcements. Increases in the number of website sessions, the conversion rate of website sessions to orders and the average value of orders placed by customers all contributed to the growth.
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For the first quarter of fiscal 2006 the company achieved net income of $2.9 million, or 10.0% of revenues, and earnings per share on a diluted basis of $0.04. The company incurred a net loss of $20.4 million in the first quarter of fiscal year 2005, which included a $21 million contract termination charge.
"This quarter marked our 21st quarter in a row of sequential organic revenue growth," said Robert Keane, president and CEO of VistaPrint. "Our top line growth, driven by both new customer and repeat customer purchases, continues to prove that the small office home office market values the high quality graphic design services and customized printed products that VistaPrint delivers at affordable prices."
"Three keys to our business are our proprietary back-end order aggregation and print technology, our proprietary front-end design technology and our Internet marketing expertise. When combined with VistaPrint's computer integrated and automated manufacturing processes, they allow us to deliver massive volumes of designed, custom-manufactured orders: currently over 10,000 per day. The result is high quality product at very affordable prices for our customers and strong margins for our company," continued Keane.
Key financial metrics for the first quarter of 2006:
- Revenue bookings from repeat customers increased to 59.6 percent versus 54.2 percent in the first quarter of fiscal 2005.
- Average order values increased 10.6 percent from the same quarter of the prior fiscal year to $31.
- Web site sessions increased by 41.1 percent from the same quarter of fiscal 2005.
- Conversion rates increased to 4.5 percent from 4.4 percent in the first quarter of fiscal 2005.
- Revenue minus cost of sales was 60.9 percent versus 61.8 percent in the same quarter of the prior fiscal year.
- Operating margins increased to 11.7 percent of revenues.
- Capital expenditures in the first quarter of 2006 totaled $3.3 million, primarily related to the completion of the production facility in Windsor, Ontario.
On August 30, 2005 VistaPrint completed the transition of its North American production being produced by an outsourced vendor to a newly constructed VistaPrint facility in Windsor, Ontario. VistaPrint is now 100 percent vertically integrated from a manufacturing standpoint, handling all production in-house.
"The transition to our Windsor printing facility has been a huge success," said Paul Flanagan, chief financial officer of VistaPrint. "During the first two months of the quarter, we incurred start up and training costs associated with getting the new facility operational. We were very pleased that we were able to have a smooth transition, absorb these additional costs and still deliver strong margins."
VistaPrint also completed a $138 million initial public offering on September 29, 2005, with net proceeds of $61.4 million, less underwriting discounts, to the company and the remaining net proceeds to selling shareholders. The Company received its net proceeds from the IPO on October 5, 2005.
"We are pleased with the reception we received from the financial markets throughout the IPO process," said Keane. "After receiving the proceeds from our initial public offering, we now have $88 million in cash. Additionally, for the quarter ended September 30, 2005, we generated $3 million in cash from operations. This gives us a strong balance sheet from which we can invest in additional products, services, technology and infrastructure to better serve our customers and extend our market leadership."
In the first quarter, the company also made additions to its management team and board of directors. Anne Drapeau joined as executive vice president and chief people officer, reporting directly to Robert Keane. Prior to joining VistaPrint, Drapeau oversaw the human resources function as chief people officer at Digitas, a leader in the digital and direct marketing industry. VistaPrint also appointed Daniel Ciporin, former chairman and CEO of Shopping.com, to its board of directors. Ciporin will serve on the company's Audit Committee and Nominating and Corporate Governance Committee.
VistaPrint will hold a conference call to discuss first quarter fiscal 2006 financial results at 8:00 a.m. (EST) on October 26, 2005. To listen to the live webcast, log on to the Investor Relations section of www.vistaprint.com. A replay of the event will be available on the Company's website from 10:00 a.m. on October 26, 2005 until midnight on November 9, 2005.