Vistaprint N.V. (VPRT) has declared fourth quarter 2011 adjusted earnings of 43 cents per share, handily beating the Zacks Consensus Estimate of 32 cents. Earnings per share (EPS) increased 13% year over year and touched the upper-end of the company’s guided range of 38–43 cents. The better-than-expected results were driven by double-digit growth in the top line.
On a GAAP basis, EPS increased 23% to 32 cents during the quarter, in line with the company’s guided range of 28–33 cents.
The company registered a 27% year-over-year growth in revenues to reach $208.8 million, including the favorable impact of foreign currency. Revenues surpassed management’s guidance range of $202 million to $207 million and the Zacks Consensus Estimate of $204 million. Geographically, Vistaprint derived 57%, 37% and 6% of revenues from North America, Europe and Asia-Pacific markets, respectively.
For full-year 2011, revenue grew 22% year over year to $817.0 million. Adjusted EPS increased 16% to $2.30 while GAAP EPS of $1.83 saw a growth of 23%.
Behind the Headline Numbers
In the fourth quarter, gross margin expanded 30 basis points (bps) from the year-ago quarter to 63.9%. Operating income was $17.0 million, reflecting an upside of 22% from the prior-year quarter. Operating margin slipped 40 basis points from the prior-year quarter to 8.1%.
Among key metrics, Vistaprint noted 71.4 million website sessions in the quarter, representing an 8% drop from the prior-year quarter. However, total order volume increased roughly 17% from the prior-year quarter to 5.6 million.
Vistaprint acquired 1.8 million new customers in the quarter. The company noted that 68% of the bookings came from repeat customers versus 67% from the year-ago quarter.
Financial Position
At quarter end, the company had $237.1 million in cash, cash equivalents and short-term marketable securities. Total assets of the company were $555.9 million while total liabilities amounted to $105.8 million.
Guidance
For the first quarter of 2012, Vistaprint expects adjusted EPS to be in the 20–30 cent range. On a GAAP basis, the company expects EPS in the range of 7 cents to 17 cents and revenues in the range of $207 million to $215 million.
For full-year 2012, the company expects adjusted EPS in the range of $1.58 to $1.68 per share. On a GAAP basis, EPS is projected between $1.10 and $1.20. Revenue is expected in the range of $980–$1,030 million.
Our Take
Vistaprint’s focus on small business markets provides it with ample growth opportunities. The company is also expanding its geographical footprint. However, management commented that 2012 will prove to be a challenging year for Vistaprint. There are a few planned investments in 2012 that will hurt its bottom line. Revenue growth will also be slower year over year.
Vistaprint, which competes with Sykes Enterprises Inc. (SYKE) and TeleTech Holdings Inc. (TTEC), currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock.
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