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Cimpress (CMPR) Incurs Q1 Loss, Revenues Miss Estimates
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Business services provider Cimpress N.V. (CMPR - Free Report) reported lackluster first-quarter fiscal 2017 results with a GAAP loss of $29.1 million or loss of 92 cents per share, as against a net income of $10.8 million or 32 cents per share in the year-ago quarter. The significant year-over-year decrease, despite higher revenues, was primarily due to higher operating costs in the reported quarter. Specifically, the GAAP loss was attributable to some anticipated headwinds from an amendment to the WIRmachenDRUCK earn-out arrangement, loss of certain partner revenue and profits, increased organic investment spend and implementation of new long-term incentive program.
First-quarter recurring loss (with stock-based compensation adjustments) was 29 cents per share. The Zacks Consensus Estimate for earnings was pegged at 11 cents.
Total revenue in the first-quarter surged 18% year over year to $443.7 million but missed the Zacks Consensus Estimate of $456 million. Revenues in the reported quarter improved due to superior performance in the Vistaprint business unit and Upload and Print segment, partially offset by a decline in All Other segment due to the wind down of two partnerships.
Revenues from the Vistaprint segment came in at $285.4 million, up from $267.5 million in the year-ago quarter due to strong sales. However, organic revenue growth was negatively impacted by increased Vistaprint backlog due to flooding in a North American facility due to extreme weather that shut down the largest production location at the end of the quarter. This reduced constant-currency revenue growth by approximately 200 basis points. Additionally, revenue growth was pressed by the loss of certain partner revenue and a reduction in Vistaprint shipping prices.
Revenues from the Upload and Print segment nearly doubled to $132.0 million from $76.5 million in the year-earlier quarter. Revenues from All Other Business declined 8% year over year to $27.7 million from $30.2 million in the prior-year quarter.
Gross margin in the reported quarter contracted to 51.8% from 58.1% in the year-ago period primarily due to the increased weighting of lower margin Upload and Print businesses. Operating loss in the reported quarter was $27.8 million as against an operating income of $12.1 million a year ago.
Adjusted net operating profit after tax (adjusted NOPAT) in the reported quarter was $(4.7) million as against $16.4 million in the year-ago period.
Balance Sheet & Cash Flow
As of Sep 30, 2016, the company had $53.6 million in cash and cash equivalents and long-term debt of $654.3 million. At the quarter end, the company had $419.3 million of borrowing capacity available under its committed credit facility.
Capital expenditures in the reported quarter were $19.3 million or 4.4% of revenue. During the quarter, the company generated $9.6 million of cash from operations compared with $27.4 million in the year-ago quarter.
LogMeIn has a long-term earnings growth expectation of 22.5% and is currently trading at a forward P/E of 95.5x.
Accenture has a long-term earnings growth expectation of 10.1% and is currently trading at a forward P/E of 19.5x.
Carbonite has a long-term earnings growth expectation of 30.0% and is currently trading at a forward P/E of 111.1x.
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Cimpress (CMPR) Incurs Q1 Loss, Revenues Miss Estimates
Business services provider Cimpress N.V. (CMPR - Free Report) reported lackluster first-quarter fiscal 2017 results with a GAAP loss of $29.1 million or loss of 92 cents per share, as against a net income of $10.8 million or 32 cents per share in the year-ago quarter. The significant year-over-year decrease, despite higher revenues, was primarily due to higher operating costs in the reported quarter. Specifically, the GAAP loss was attributable to some anticipated headwinds from an amendment to the WIRmachenDRUCK earn-out arrangement, loss of certain partner revenue and profits, increased organic investment spend and implementation of new long-term incentive program.
First-quarter recurring loss (with stock-based compensation adjustments) was 29 cents per share. The Zacks Consensus Estimate for earnings was pegged at 11 cents.
CIMPRESS NV Price, Consensus and EPS Surprise
CIMPRESS NV Price, Consensus and EPS Surprise | CIMPRESS NV Quote
Quarter Details
Total revenue in the first-quarter surged 18% year over year to $443.7 million but missed the Zacks Consensus Estimate of $456 million. Revenues in the reported quarter improved due to superior performance in the Vistaprint business unit and Upload and Print segment, partially offset by a decline in All Other segment due to the wind down of two partnerships.
Revenues from the Vistaprint segment came in at $285.4 million, up from $267.5 million in the year-ago quarter due to strong sales. However, organic revenue growth was negatively impacted by increased Vistaprint backlog due to flooding in a North American facility due to extreme weather that shut down the largest production location at the end of the quarter. This reduced constant-currency revenue growth by approximately 200 basis points. Additionally, revenue growth was pressed by the loss of certain partner revenue and a reduction in Vistaprint shipping prices.
Revenues from the Upload and Print segment nearly doubled to $132.0 million from $76.5 million in the year-earlier quarter. Revenues from All Other Business declined 8% year over year to $27.7 million from $30.2 million in the prior-year quarter.
Gross margin in the reported quarter contracted to 51.8% from 58.1% in the year-ago period primarily due to the increased weighting of lower margin Upload and Print businesses. Operating loss in the reported quarter was $27.8 million as against an operating income of $12.1 million a year ago.
Adjusted net operating profit after tax (adjusted NOPAT) in the reported quarter was $(4.7) million as against $16.4 million in the year-ago period.
Balance Sheet & Cash Flow
As of Sep 30, 2016, the company had $53.6 million in cash and cash equivalents and long-term debt of $654.3 million. At the quarter end, the company had $419.3 million of borrowing capacity available under its committed credit facility.
Capital expenditures in the reported quarter were $19.3 million or 4.4% of revenue. During the quarter, the company generated $9.6 million of cash from operations compared with $27.4 million in the year-ago quarter.
Cimpress currently has a Zacks Rank #5 (Strong Sell). Some better-ranked stocks in the industry include LogMeIn, Inc. , Accenture plc (ACN - Free Report) and Carbonite, Inc. , each carrying Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
LogMeIn has a long-term earnings growth expectation of 22.5% and is currently trading at a forward P/E of 95.5x.
Accenture has a long-term earnings growth expectation of 10.1% and is currently trading at a forward P/E of 19.5x.
Carbonite has a long-term earnings growth expectation of 30.0% and is currently trading at a forward P/E of 111.1x.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>