Cimpress(CMPR) - 2024 Q2 - Quarterly Report

Revenue Growth - Revenue increased by 9% to $921.4 million in Q2 FY2024[114] - Organic constant-currency revenue growth was 6$1,678.7 million year-to-date FY2024[117] - Organic constant-currency revenue growth was 5% year-to-date FY2024[117] - Total segment revenue for Q3 2023 reached $934.4 million, a 9.1$856.3 million in Q3 2022[6] - National Pen revenue grew to $130.6 million in Q3 2023, up 8.3$120.6 million in Q3 2022[6] - The Print Group's revenue increased to $93.3 million in Q3 2023, a 4.4$89.3 million in Q3 2022[6] - Revenue growth in the Vista business was driven by an increase in total customer count and revenue per customer, with strong growth in consumer products during the seasonally significant second fiscal quarter[16] Operating Performance - Operating income increased by $74.1 million to$107.7 million in Q2 FY2024[115] - Adjusted EBITDA increased by $55.3 million to$166.4 million in Q2 FY2024[115] - Vista segment EBITDA increased to $103.2 million in Q3 2023, up from$55.2 million in Q3 2022, representing an 87% growth[125] - Total segment EBITDA for Q3 2023 was $183.8 million, a 55.1$118.5 million in Q3 2022[125] - Adjusted EBITDA increased by $98.4 million to$255.2 million, driven by operating income growth, partially offset by $8.0 million and$11.5 million of unfavorable currency impacts for the three and six months ended December 31, 2023, respectively[18] - Operating income increased by $126.2 million to$141.8 million, driven by higher gross profit, gross margin expansion, improved advertising leverage, and reduced operating expenses, including lower restructuring costs of $10.7 million and$12.9 million for the three and six months ended December 31, 2023, respectively[17] Financial Position - Total accrued expenses increased to $265,461 as of December 31, 2023[136] - Total debt outstanding, net decreased to$1,612,025 as of December 31, 2023[140] - Weighted-average interest rate on outstanding borrowings under the Restated Credit Agreement was 7.91% as of December 31, 2023[145] - Income tax expense decreased to $16,795 for Q2 FY2024 compared to$126,129 in Q2 FY2023[149] - Long-lived assets in the United States decreased to $70,927 million from$83,956 million due to the reclassification of a tax receivable from non-current to current[11] - The company had $208.1 million in unrecorded purchase commitments as of December 31, 2023, including$93.4 million for inventory and fulfillment[12] Cash Flow and Capital Expenditures - Net cash provided by operating activities for the six months ended December 31, 2023 was $217.2 million, a 289$55.9 million in the same period of 2022[1] - Cash from operations increased by $161.3 million year over year, primarily due to higher operating income and a favorable shift in working capital inflows of$88.7 million, partially offset by higher cash taxes of $15.3 million and net cash interest payments of$14.7 million[20] - Total purchases of property, plant, and equipment for the six months ended December 31, 2023, were $33,955 million, compared to$26,490 million in the prior year, with significant increases in PrintBrothers and National Pen segments[9] Depreciation, Amortization, and Development Costs - Total depreciation and amortization for the three months ended December 31, 2023, was $39,089, a decrease from$40,874 in the same period in 2022[126] - Total capitalization of software and website development costs for the six months ended December 31, 2023, was $28,344, slightly down from$29,246 in 2022[127] Derivatives and Hedging - The fair value of derivatives designated as hedging instruments as of December 31, 2023, was $14,362 for assets and$(2,456) for liabilities[129] - The net amount of currency forward contracts not designated as hedging instruments was $89 for assets and$(4,761) for liabilities as of December 31, 2023[129] - Interest rate swaps designated as hedging instruments resulted in a net loss of $8,081 for the three months ended December 31, 2023[130] - Cross-currency swaps designated as hedging instruments resulted in a net loss of$2,190 for the three months ended December 31, 2023[130] - Total derivatives designated as hedging instruments resulted in a net loss of $19,590 for the three months ended December 31, 2023[130] - Interest rate swaps reclassified from accumulated other comprehensive loss into income resulted in a net loss of$2,274 for the three months ended December 31, 2023[130] - Cross-currency swaps reclassified from accumulated other comprehensive loss into income resulted in a net gain of $2,230 for the three months ended December 31, 2023[130] - Total before income tax for derivatives designated as hedging instruments was a net loss of$44 for the three months ended December 31, 2023[130] - The company's most significant net currency exposures by volume are in the Euro and British Pound, with currency hedging aimed at reducing volatility in forecasted U.S. dollar-equivalent adjusted EBITDA[227] Regional Revenue Contribution - North America accounted for $435.5 million of total revenue in Q3 2023, representing 47.3$449.0 million to total revenue in Q3 2023, representing 48.8% of total segment revenue[6] Central and Corporate Costs - Central and corporate costs totaled $35.9 million in Q3 2023, up 6.4$33.8 million in Q3 2022[125] Earnings Per Share - Diluted net income per share attributable to Cimpress plc increased to $2.31 from a loss of$6.31 in the prior fiscal year, primarily due to higher operating income and a decrease in income tax expense of $109.3 million and$110.6 million for the three and six months ended December 31, 2023, respectively[19]