Cimpress reports fiscal first-quarter loss despite sales increase

GaryPageau
Getting your Trinity Audio player ready...

Vista parent Cimpress plc increased sales by 6% on an annual basis to $804.97 million during the first quarter but showed a loss of about $12.55 million during the three-month period. The company said the bottom-line decrease was a result of factors that included increases in advertising spending and product mix shifts that reduced gross margin in the Vista division, as well as higher volume-related operating costs. Cimpress businesses include BuildASign, druck.at, Drukwerkdeal, easyflyer, Exaprint, National Pen, Packstyle, Pixartprinting, Printi, Tradeprint, VistaPrint and WIRmachenDRUCK.

During the previous fiscal year’s first quarter, Cimpress generated a net income of about $4.5 million.

By segment, Vista grew Q1 revenue 8% on both a reported and organic constant-currency basis driven by customer experience improvements and new product introductions that have supported continued increases in average order value and customer count, the company claimed. Vista is currently preparing for the expected seasonal peak in consumer-related volume for the December quarter. The improved customer experience and pace of new product introduction powered by the new technology platform have enabled year-over-year revenue growth in Vista’s consumer product category in each of the last five quarters, the company claimed.

PrintBrothers and The Print Group (the combined Upload & Print businesses) Q1 revenue grew year over year by 5% and 6%, respectively (5% combined), and on an organic constant-currency basis by 4% for both segments and on a combined basis. This was driven by growth in order volumes as well as higher fulfillment for other Cimpress businesses, partially offset by lower per-order quantities in some product categories, the company said.

SUMMARY CONSOLIDATED RESULTS: THREE-YEAR TREND

$ in thousands, except percentages

REVENUE BY REPORTABLE SEGMENT, TOTAL REVENUE AND INCOME FROM OPERATIONS:

  Q1 FY2023 Q1 FY2024 Q1 FY2025
Vista $ 369,589 $ 396,850 $ 429,494
PrintBrothers        132,801       152,573       160,415
The Print Group          76,059         79,437         84,072
National Pen         81,547         86,796         93,404
All Other Businesses         51,551         51,425         57,143
Inter-segment eliminations              (8,132)              (9,787)           (19,559)
Total revenue $ 703,415 $ 757,294 $ 804,969
Reported revenue growth  7 %  8 %  6 %
Organic constant currency revenue growth  14 %  4 %  6 %
Income from operations $ (17,967) $      34,100 $      39,339
Income from operations margin  (3) %  5 %  5 %

EBITDA BY REPORTABLE SEGMENT (“SEGMENT EBITDA”) AND ADJUSTED EBITDA:

Q1 FY2023 Q1 FY2024 Q1 FY2025
Vista $ 33,844 $       78,578 $       76,847
PrintBrothers 15,116          20,210          20,156
The Print Group 11,456          12,507          17,902
National Pen (1,416)               (8,762)               (4,758)
All Other Businesses 5,816             6,018             6,735
Inter-segment elimination (1,987)               (2,538)               (5,500)
Total segment EBITDA $ 62,829 $ 106,013 $ 111,382
Central & corporate costs ex unallocated SBC (35,535)             (32,128)             (35,178)
Unallocated share-based compensation 957                348               (1,834)

During the first quarter of fiscal year 2025, the company implemented changes to the methodology used for inter-segment transactions for purposes of measuring and reporting segment’s financial performance. Under the new approach, a merchant business (the buyer) is cross charged the actual cost of fulfillment that includes product (e.g., labor, materials and overhead allocation) and shipping costs. A fulfiller business (the seller) receives inter-segment revenue that includes the product costs plus a markup, as well as the shipping costs. The fulfiller profit is included in the fulfiller’s segment results, but eliminated from consolidated reporting through an inter-segment EBITDA elimination. We have revised the prior periods starting in Q1 FY2023 to incorporate this change. Please refer to the Q1 FY2025 Guide to Reporting Changes at ir.cimpress.com for more information.