Cimpress(CMPR) - 2024 Q4 - Annual Report

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]