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Cimpress (CMPR) Down 11.5% Since Last Earnings Report: Can It Rebound?

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A month has gone by since the last earnings report for Cimpress (CMPR). Shares have lost about 11.5% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Cimpress due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

Cimpress Q4 Earnings Miss Estimates, Revenues Beat

Cimpress reported mixed fourth-quarter fiscal 2021 results, wherein earnings missed the Zacks Consensus Estimate, but revenues beat the same.

The company reported an adjusted loss of 45 cents per share, wider than the Zacks Consensus Estimate of a loss of 17 cents by 164.7%. The bottom line improved from the year-ago quarter’s loss of $1.62 cents per share.

In fiscal 2021, the company’s adjusted loss was $2.99 per share against adjusted earnings of $3.00 in fiscal 2020.

Top-Line Details

Total revenues in the fiscal fourth quarter were $641 million compared with $429.1 million in the year-ago quarter. The top line surpassed the consensus estimate of $615 million by 4.3%.

In fiscal 2021, its revenues totaled $2,592.5 million compared with $2,481.4 million in the previous fiscal year.

Segmental Information

The National Pen segment generated revenues of $69 million, up from $33 million in the prior-year quarter. Vistaprint — the largest revenue generating segment of the company — reported aggregate revenues of $351.7 million, up from $244.5 million in the year-ago quarter.

The Upload and Print segment’s revenues increased to $178.6 million from $118.9 million in the year-ago quarter. The segment consists of two subgroups —  PrintBrothers and The Print Group. PrintBrothers’ revenues increased to $105.9 million from $72.5 million in the prior-year quarter. The Print Group generated revenues of $72.9 million, up from $46.7 million. Revenues from All Other Businesses increased to $49.1 million from $42.5 million.

Margin Details

In the quarter, Cimpress' cost of revenues was $329.6 million, up 50.1% on a year-over-year basis. It represented 51.4% of total revenues. Total selling, general & administrative expenses were $221.9 million, up 66.3%. It represented 34.6% of total revenues in the fiscal fourth quarter.

Gross profit increased 48.6% year over year to $311.4 million with margin of 48.6%, down 20 basis points. Net interest expenses rose 6.8% to $29.7 million.

Balance Sheet and Cash Flow

As of Jun 30, 2021, Cimpress had $183 million in cash and cash equivalents compared with $36.4 million at the end of the previous quarter. Also, the company’s total debt (net of issuance costs) was $1,742.4 million, up from $1,341.2 million, sequentially. In the fiscal fourth quarter, Cimpress refrained from buying back shares.

In fiscal 2021, net cash provided by operating activities was $265.2 million compared with $338.4 million a year ago.

Outlook

The company anticipates benefiting from end-market recovery in the quarters ahead. Also, it expects to significantly increase its organic growth investment in fiscal 2022, majority of which will likely be in the Vistaprint segment and related to hiring.

For fiscal 2022, Cimpress expects to incur an increase in capital expenditures on a year-over-year basis, primarily due to investment for production innovation and product launches.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.


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