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Mar 31, 2020
Cimpress Q3 2020 Earnings Report
COVID-19 pandemic impacted demand, cost reductions were executed, and financial flexibility was ensured.
Key Takeaways
Cimpress' Q3 revenue declined by 10% due to the COVID-19 pandemic, particularly impacting results in March. The company implemented cost reduction measures and secured financial flexibility to weather the pandemic's effects.
Revenue declined 10% due to COVID-19 impacts, with a 30% decline in March.
GAAP operating loss was $87.7 million, including goodwill impairments of $100.8 million.
Adjusted EBITDA was $70.9 million, a 20% decrease year-over-year.
The company executed significant cost reductions and secured financial flexibility.
Cimpress
Cimpress
Cimpress Revenue by Segment
Revenue by Segment
Vista Revenue
CapyFin.comPrintBrothers Revenue
CapyFin.comThe Print Group Revenue
CapyFin.comNational Pen Revenue
CapyFin.comAll Other Businesses Revenue
CapyFin.com Forward Guidance
Near-term outlook is negatively impacted by the COVID-19 pandemic, but the long-term view has strengthened. Q4 2020 bookings have declined, but there are signs of improvement. The revenue recovery is expected to lag in other segments.
Positive Outlook
- Shift in focus to products and product templates that customers need in the current environment
- In some geographies the start, although minimal, of relaxing government restrictions to restart economic activity
- Businesses have done well during past economic recessions, because we offer a better value proposition for a lower price than traditional sources of our products.
- During times that unemployment has increased, people start freelancing, a creative endeavor, or a new job search, and our convenient, professional products offered in low quantities at affordable prices help people get started.
- The competitive landscape is likely to change dramatically in favor of those who are flexible enough to make it through this current period, including Cimpress.
Challenges Ahead
- Demand worsened through March, with consolidated bookings declining approximately 65% year over year in the last week of the month and first week of April.
- For the month of April, consolidated bookings declined approximately 51% year over year.
- Cannot predict what our revenue results will be for the remainder of Q4 FY2020, which we believe will be highly dependent on the extent to which government restrictions are maintained or relaxed.
- In National Pen we do expect the revenue recovery curve is likely to lag other segments given the amount of their revenue that is generated through direct mail channels that will lag e-commerce channels.
- Not in a position to comment on our outlook beyond FY2020 given the uncertainty of both the extent and duration of the impact of COVID-19 on our customers and operations.
Revenue & Expenses
Visualization of income flow from segment revenue to net income