) declared second quarter 2012 adjusted earnings of 97 cents per
share, comprehensively beating the Zacks Consensus Estimate of 61
cents. The better-than-expected results were driven by double-digit
growth in the top line.
Reported earnings per share (
) also increased from the year-ago level of 89 cents and exceeded
the company's guided range of 73-85 cents. On a GAAP basis, EPS was
82 cents versus 75 cents in the comparable quarter of last year.
This was also way ahead of the company's guided range of 57-69
The company registered a 28% year-over-year growth in revenues
to $299.9 million, including the impact of foreign currency as well
as a contribution of $15.7 million from Albumprinter. However, the
other acquisition, Webs was not accretive to revenue during the
reporting quarter. Revenues were within management's guidance range
of $285 million to $306 million. Geographically, Vistaprint derived
47%, 48% and 6% of revenues from North America, Europe and
Asia-Pacific markets, respectively.
Behind the Headline Numbers
In the second quarter, gross margin rose 50 basis points (bps)
from the year-ago quarter to 66.8%. Operating income came in at
$32.5 million, reflecting a downside of 15% from the prior-year
quarter. Operating margin plunged 540 basis points from the
prior-year quarter to 10.9%.
However, total order volume increased roughly 28% year over year
to 8.3 million in the second quarter of fiscal 2012. Vistaprint
added 2.9 million new customers in the quarter.
At quarter end, the company had $67.5 million in cash, cash
equivalents and short-term marketable securities. Total assets of
the company were $590.4 million while total liabilities amounted to
For the third quarter of 2012, Vistaprint expects adjusted EPS
in the 14-29 cents range. On a GAAP basis, loss per share is
expected in the range of 19 cents to 4 cents and revenues in the
range of $246 million to $261 million. The company expects
constant-currency organic growth of approximately 16-23%.
For full-year 2012, the company expects adjusted EPS in the
range of $1.71 to $1.83 (versus $1.74 to $1.86 as provided earlier)
per share. On a GAAP basis, EPS is projected between 86-98 cents
(versus $1.08-$1.20 as provided earlier). Revenue is expected in
the range of $1006-$1,036 million.
Vistaprint remains on track to grow inorganically. While the
company's recent acquisition of Albumprinter has somewhat
contributed to the total revenue in the second quarter, Web will
likely add a small amount of revenue in the back half of the year.
Additionally, the company has a share repurchase program in place
to boost its full-year earnings.
However, 2012 could prove to be a challenging year for
Vistaprint as there are a few planned investments, which will weigh
on its bottom line. The fact can be validated from management's cut
in full-year guidance. Acquisitions will also be dilutive to
earnings. To add to the worry, an unfavorable exchange rate will
also take a toll on Vistaprint's revenue.
Vistaprint, which competes with
Sykes Enterprises Inc.
TeleTech Holdings Inc.
), currently retains a Zacks #5 Rank, which translates into a
short-term Strong Sell rating. We are maintaining our long-term
Underperform recommendation on the stock.
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