| --- | --- | --- | |-------|-------|-------| | | | | | | | | LETTER FROM ROBERT OCTOBER 30, 2024 Dear Investor, Cimpress delivered solid results in the first quarter of fiscal year 2025. Operationally, we continued the strong progress demonstrated in the prior fiscal year with improvements in customer value and new product introduction. Financially, strong revenue growth at Vista bolstered consolidated revenue and adjusted EBITDA declined slightly compared to last year inclusive of negative currency impact ...

Cimpress (CMPR) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #2 (Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices. The Zacks rating relies solely on a company's changing earnings picture. It tracks EPS estimates for the current and following years from the sell-side analysts covering the stock through a consensus measure -- the Zacks Consensus Estimate. Since a changing earnings pictu ...

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks. Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried- ...

I have been discussing Cimpress plc (NASDAQ: CMPR ) in the past, and you can read my previous article published on July 5, 2024. The company is looking to introduce new products I have more than 14 years of experience in analyzing and writing on stocks. I write on both long and short sides in an unbiased manner. I have been covering the energy sectors for the past 7 years, with the primary focus on the oilfield equipment services sector. I also cover the Industrial Supply industry. I occasionally co-author ...

Core Insights - Cimpress plc (CMPR) is experiencing strong growth across its Vista, National Pen, and Upload & Print segments, driven by e-commerce and improved customer experience [1][2] Segment Performance - In Q4 of fiscal 2024, the Vista segment's revenues increased by 8% year over year, while Upload & Print saw a 6% rise, and National Pen grew by 1% [2] - The company's operations provide small businesses access to quality products and services, with an expanded product line catering to marketing needs [3] Financial Metrics - Cimpress is focused on cost-control measures, resulting in a 100 basis point increase in gross margin year over year in Q4 [4] - The adjusted EBITDA margin remained consistent with the previous year's quarter [4] - However, the cost of revenues rose by 2.5% year over year due to increased production and shipping costs, while general and administrative expenses increased by 2.9% [6] Debt and Cash Position - As of the end of fiscal 2024, Cimpress had a long-term debt of $1.6 billion, which raises concerns given its cash and cash equivalents of $203.8 million [6] Stock Performance - Over the past year, Cimpress shares have gained 19.5%, outperforming the industry growth of 18.2% [5]

Cimpress plc (CMPR) recently completed its earlier announced private offering of senior notes worth $525 million in aggregate principal amount. CMPR's shares lost 0.4% on the last trading day to eventually close the trading session at $81.84. Inside the Headlines The senior notes carry an interest rate of 7.375% and are scheduled to mature in 2032. The notes are priced at 100% of the principal amount. Interest on the notes will be paid on a semi-annual basis. Along with the senior notes offering, Cimpress r ...

Cimpress plc (CMPR) recently priced its earlier announced private offering of senior notes worth $525 million in aggregate principal amount. The offering comprises 7.375% senior notes due to expire in 2032. It is worth mentioning here that the company's shares lost 0.4% yesterday, ending the trading session at $79.94. Inside the Headlines As communicated by the company, the notes have been priced at 100% of the principal amount. Interest rates on the notes will be paid semi-annually. Subject to customary co ...

Cimpress plc (CMPR) announced that it has commenced the offering of senior notes worth $525 million in aggregate principal amount. The senior notes due in 2032 will be offered through private placement. It is worth mentioning here that the company's shares lost 4.1% yesterday, ending the trading session at $80.23. Inside the Headlines With the completion of the notes offering, CMPR plans to amend its existing credit agreement by extending its revolving credit facility's maturity and adjusting the interest r ...

Core Insights - Cimpress plc is experiencing growth across its Vista, National Pen, and Upload & Print segments, driven by technology investments and product innovation [1] - The company is benefiting from increased customer count and higher average order values, particularly in the Vista segment [1] - E-commerce growth is significantly impacting the National Pen segment, while the Upload & Print segment is expected to see revenue benefits from rising order rates [2] Financial Performance - Cimpress' gross margin improved by 100 basis points year-over-year in Q4 of fiscal 2024, with adjusted EBITDA margin remaining stable compared to the previous year [2] - The company's cost of revenues increased by 3.3% in fiscal 2024, influenced by rising costs for materials and shipping [5] - Long-term debt stood at $1.6 billion in fiscal 2024, with a CAGR of 2.4% over the last five years, raising concerns about the company's financial leverage [6] Operational Efficiency - The company is restructuring its product development teams to enhance customer value and operational efficiency [4] - Cimpress has expanded its product line to cater to a variety of marketing needs for small business customers, leveraging its scale to provide quality services [3] Cost Management - Effective cost-control measures have supported Cimpress' margin performance despite rising input costs, which increased the cost of sales by 6.3% from fiscal 2020 to fiscal 2024 [4][5] - General and administrative expenses rose by 2.9% year-over-year in Q4 due to increased travel, training, and consulting costs [5]

Financial Performance - Revenue for fiscal year 2024 increased by 7% to $3,291.9 million compared to $3,079.6 million in fiscal year 2023[142] - Organic constant-currency revenue growth was 5% for fiscal year 2024[142] - Operating income rose by $190.0 million to $247.4 million, driven by a $157.8 million increase in gross profit and operating expense efficiencies[143] - Adjusted EBITDA increased by $128.9 million to $468.7 million for fiscal year 2024[142] - Diluted net income per share attributable to Cimpress plc improved to $6.43 from a loss of $7.08 in the prior fiscal year[142] - Cash provided by operating activities increased by $220.4 million to $350.7 million[142] - Adjusted free cash flow rose by $237.7 million to $261.1 million, supported by increased operating cash flow and higher proceeds from asset sales[146] Revenue Breakdown - Revenue growth was observed across all segments, with Vista business revenue driven by new and repeat customers[142] - Vista's reported revenue grew by 8% to $1.742 billion, with segment EBITDA increasing by 47% to $328.472 million, representing 19% of revenue[166][168] - PrintBrothers reported revenue increased by 10% to $638.036 million, with segment EBITDA growing by 27% to $89.876 million, representing 14% of revenue[169][171] - The Print Group reported revenue of $358,918,000 for the year ended June 30, 2024, representing a 3% increase compared to $346,949,000 in 2023[173] - National Pen's revenue increased by 7% to $391,192,000 for the year ended June 30, 2024, compared to $366,294,000 in 2023[176] - All Other Businesses reported revenue of $215,807,000, a slight increase of 1% from $213,455,000 in 2023[179] Expenses and Costs - Cost of revenue increased by $54.4 million year over year, with cost of revenue as a percentage of revenue decreasing to 51.5% from 53.3%[150] - Technology and development expenses increased by $19.7 million to $321.968 million for the year ended June 30, 2024, representing 9.8% of revenue, unchanged from the prior year[151][153] - Marketing and selling expenses rose by $15.9 million to $789.872 million, accounting for 24.0% of revenue, down from 25.1% in the previous year[156] - General and administrative expenses decreased by $3.5 million to $205.737 million, representing 6.2% of revenue, down from 6.8%[158] - Central and corporate costs increased by $11.8 million in 2024, primarily due to a $20.5 million rise in share-based compensation expenses[184] Tax and Other Income - The company recognized $204.9 million of lower income tax expense, primarily due to a partial reversal of a valuation allowance on Swiss deferred tax assets[145] - The effective tax rate improved to -38.4% for the year ended June 30, 2024, compared to -514.5% in the prior year, due to a partial release of the valuation allowance on Swiss deferred tax assets[162][163] - Other income, net decreased to $1.583 million from $18.498 million, primarily due to currency exchange rate volatility impacting derivatives not designated as hedging instruments[159][160] Cash Flow and Debt - Net cash provided by operating activities was $350,722,000 in 2024, significantly up from $130,289,000 in 2023[185] - The company had $203.8 million in cash and cash equivalents and $1,616.6 million in debt as of June 30, 2024[186] - Total contractual obligations amounted to $2,356,025,000, with significant commitments in operating leases and purchase commitments[191] - The company repurchased 1,723,393 ordinary shares for $157 million during the year ended June 30, 2024[187] - As of June 30, 2024, the company has borrowings of $1,084.6 million under its senior secured credit agreement, with a final maturity date of May 17, 2028[193] - The company has a $250.0 million senior secured revolving credit facility, with $238.0 million unused as of June 30, 2024[193] Interest Rate and Currency Risk - The company had $1,084.6 million of variable-rate debt, exposing it to market risk from interest rate changes[222] - A hypothetical 100 basis point increase in interest rates would result in an $8.8 million increase in interest expense over the next 12 months[222] - The company manages currency exchange rate risk through normal operating activities and derivative financial instruments, with significant exposures in the Euro and British Pound[223] - A hypothetical 10% decrease in exchange rates against the functional currency would have resulted in an $8.8 million change in income (loss) before income taxes for the year ended June 30, 2024[227] Goodwill and Intangible Assets - The company evaluates goodwill and indefinite-lived intangible assets for impairment annually, with no impairments recognized for the year ended June 30, 2024[219] - The fair value of identifiable intangible assets acquired in business combinations is based on detailed cash flow valuations, which may differ materially from actual results[215] - The company has not experienced significant impairments of capitalized software and website development costs historically[214] - Costs related to business acquisitions are expensed as incurred, while any excess purchase price over fair value is allocated to goodwill[216] Financial Instruments - The company utilizes interest rate swap contracts to mitigate exposure to interest rate changes related to its variable-rate debt[222] - The company revised its adjusted free cash flow definition to include proceeds from the sale of assets, providing a clearer picture of cash flow generation[199]