VistaPrint Ltd. (VPRT)
F1Q09 Earnings Call
October 28, 2008 5:00 pm ET
Robert Keane - President and Chief Executive Officer
Mike Giannetto - Chief Financial Officer
Domenic LaCava - Canaccord Adams
Mitch Bartlett - Craig Hallum
Randy Hugen - Piper Jaffray
Mark May - Needham & Company
Jim Friedland - Cowen and Company
Jennifer Watson - Goldman
Youssef Squali - Jeffries & Co.
Lance Mark - Wells Capital
Scott Berg - ThinkEquity
Atin Agrawal - Longbow Research
Previous Statements by VPRT
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Before we get stared please note that our comments include forward-looking statements including statements regarding revenue and earnings guidance and actual results may differ materially. Risks that could actual result to differ materially from those statements are described in the documents that we periodically file with the Securities and Exchange Commission including our Form 10-K for the fiscal year ended June 30 2008 and our other SEC filings which are available on the Investor Relations page at www.vistaprint.com.
Now I would like to turn the presentation over to Robert Keane; Robert.
Thank you Peter and welcome to everyone joining us. VistaPrint turned another strong quarter with both revenues and earrings per share inline with our guidance. I will start my presentation with an overview of the first quarter’s solid performance and operating highlights.
These will demonstrate that our business remained very healthy in the first quarter with 44% revenue growth. VistaPrint delivered these results in spite of strong headwinds from both a rising U.S. dollar and economic weakness in all our markets. Given these factors are likely to persist; we are updating our revenue guidance for fiscal 2009, which I will go over momentarily. Then for those of you who maybe new to VistaPrint, I will review our mission, vision and strategy.
Lastly I will touch on some of our key recent and ongoing investments intended to maximize our value proposition, competitiveness, growth, and profitability. Then Mike will deliver his comments on the quarter and our guidance. Later at 5:00 pm Eastern we’ll hold a separate question and answer session that you can access through a link in the Investor Relation section of www.vistaprint.com. Now, let’s review the quarter’s key metrics.
VistaPrint posted solid financial results in the first quarter reporting revenue of $114.2 million representing 44% growth year-over-year and GAAP net income of $8.3 million. GAAP earnings per share of $0.18 were at the high end of our stated guidance. Non-GAAP adjusted net income of $14 million which excludes share based compensation expense equated to non-GAAP net income per share of $0.30 which exceeded the upper end of our guidance range.
Our Q1 operating metrics were also solid. We acquired approximately 1.2 million new paying customers with stable per customer acquisition costs and generated about 66% of bookings from repeat customers, up slightly year-over-year and sequentially. We produced approximately 35,000 orders per day equal to 3.2 million orders in the quarter and we generated 38% of our revenues from non-U.S. websites despite the significant appreciation of the US dollar during the quarter.
Our business is very healthy and we continue to expect solid profitability with revenue and earnings growth during the rest of the fiscal year. However, the economy has entered a slowdown of unknown length and VistaPrint’s revenues will be significantly impacted by currency movements. While we hope these conditions will be temporary given the significant uncertainty in the economy at large, which is impacting almost all businesses globally, we think it is a prudent time to reduce our guidance.
Our revised guidance for the full fiscal year calls for revenues ranging from $475 million to $515 million, down $60 million at the mid-point from our prior guidance and reflecting 18% to 28% growth year-over-year. Our full-year GAAP EPS is now expected to be $0.93 to $1.5, down $0.16 at the mid-point and reflecting 7% to 21% growth year-over-year. Our full-year non-GAAP adjusted net income per share is now expected to be $1.36 to $1.48, down $0.13 at the mid-point and reflecting 15% to 25% growth year-over-year.
Lowering guidance is not something we take lightly. During the last few years VistaPrint has articulated and explicit EPS focused financial strategy that has helped set realistic profitability expectations during our high growth period. We continue to believe that VistaPrint remains at the early stages of a long growth opportunity and that the dislocations in the global economy and in currencies that we’re facing this year do not reflect a change in either our long-term market opportunity or our competitiveness.
As such, we believe that the best course of action for our customers, employees and shareholders is to continue to run the company for the long-term and to maintain our focus on reinvestment to maximize our long-term growth and profitability, while at the same time recognizing the current conditions made persist. In light of these realities, we have decided to slowdown our reinvestment program to maintain strong profitability.
VistaPrint has been consistently reinventing in all aspects of our operations for many years. This has left us well positioned against a highly fragmented competitive landscape and has provided us with a superior value proposition and a number of well-developed competitive advantages.
Now, in light of current global economic conditions and our profitability objectives, we continue to fund growth investments, but at recalibrated levels. This spending builds on many well-developed competencies, while seeking to achieve revised profitability objectives.