Cimpress NV ((CMPR)) has held its Q1 earnings call. Read on for the main highlights of the call.
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Cimpress NV’s recent earnings call painted an optimistic picture for the start of the fiscal year, showcasing a robust increase in revenue and profitability. The company attributed its success to the expansion of elevated products and cross-Cimpress fulfillment, despite facing challenges such as high tax expenses and cash flow issues. Nevertheless, Cimpress remains confident in its ability to meet or exceed its fiscal 2026 objectives.
Strong Revenue Growth
Cimpress NV reported a 7% increase in consolidated Q1 revenue on a reported basis and a 4% rise on an organic constant currency basis. This growth was largely driven by the Vista and PrintBrothers segments, which demonstrated significant performance improvements.
Record-High Adjusted EBITDA
The company achieved a record-high adjusted EBITDA, with an increase of $10.9 million year-over-year. This marks an 11% improvement over the previous highest Q1 EBITDA, highlighting Cimpress’s strong operational performance.
Expansion of Elevated Products
Vistaprint, a key segment of Cimpress, reported double-digit revenue growth in promotional products, apparel, gifts, packaging, and labels. This expansion has been instrumental in driving higher customer lifetime value.
Cross-Cimpress Fulfillment Success
All segments of Cimpress experienced double-digit or triple-digit growth in cross-Cimpress fulfillment revenue, contributing an additional $15 million in gross profit over the last fiscal year.
Positive Outlook for Fiscal 2026
Cimpress has set a positive outlook for fiscal 2026, expecting revenue growth between 5% and 6%, net income of at least $72 million, and adjusted EBITDA of at least $450 million.
Minimal Impact from Tariffs
While tariffs posed a challenge, their impact was minimal, costing less than $1 million. However, Cimpress recognizes the need for ongoing mitigation efforts.
High Tax Expense
The company faced a high tax expense of $17.8 million, which significantly impacted the $24.4 million income before tax. This raises concerns about future tax rates.
Cash Flow Challenges
Cimpress reported an adjusted free cash flow outflow of $17.8 million, influenced by higher capital expenditures and capitalized software expenses, along with typical seasonal variations.
Forward-Looking Guidance
Cimpress reiterated its fiscal 2026 guidance, projecting revenue growth of 5% to 6%, net income of at least $72 million, and adjusted EBITDA of at least $450 million. The company also outlined a strategic path towards achieving a fiscal 2028 EBITDA target of at least $600 million, alongside significant deleveraging efforts.
In summary, Cimpress NV’s earnings call highlighted a strong start to the fiscal year, with notable growth in revenue and profitability. Despite challenges such as high tax expenses and cash flow issues, the company remains optimistic about its future prospects, with clear strategies in place to achieve its fiscal 2026 and 2028 objectives.