Founder, chairman and CEO Robert Keane described the group’s overall results as “solid”, against a backdrop of “continued pandemic volatility and supply chain challenges” during the three months to 31 December and the busy Christmas season.
Total sales were up 9% year-on-year to $849.7m (£634.7m) in Q2, but operating margins slipped to 10% as the business invested in, and rolled out, its new Vista technology platform.
“In each country in which Vista has launched the new platform we have experienced temporary negative financial impacts. This is expected, as, for example, repeat customers adjust to the new experience,” Keane explained.
“This initial pull back has been followed by week-by-week improvements in financial performance including from new capabilities as they begin to be introduced.”
Cimpress expects to launch the new Vista platform in its largest market, the US, during Q3.
At Upload & Print, which includes Tradeprint in Dundee, sales were up 15% and EBITDA increased by 20% over the prior year.
“We believe this group of businesses is gaining market share after having used the pandemic as a catalyst to develop and launch new products and further leverage each others’ product and supply chain capabilities.” Keane noted.
“We see upload and print results as a positive sign for the future of Vista as well, since they demonstrate the benefit of new product introduction and innovation, which Vista expects to accelerate as it completes its site migration.”
National Pen sales were down 5% but the unit delivered a record level of EBITDA.
Keane said Cimpress had been able to leverage its scale in mitigating the effects of the current supply chain issues and believed that, in relative terms, “we can fare better than competitors even if in nominal terms costs are higher”.
“We increased prices and were able to maintain supply to meet customer demand,” he added.
Regarding the outlook, Keane said the pandemic was still causing volatility.
“Elevated Covid-19 cases in January and the related impact on in-person activity has dampened our consolidated bookings to date in January although we remain above last year's levels when severe government restrictions were in place particularly in Europe.”
He said the business remained confident about its ability to deliver “attractive returns” from the major investments being made, particularly at the Vista operation.
