The restructuring and investments of recent years are taking effect: Cimpress has once again reported record figures for fiscal year 2023 (July 2022 to June 2023) – and achieved significant growth in sales and profits across all business units. No wonder the world’s largest online print provider is starting the new fiscal year with optimism. The focus is to be on further improving the customer offering and on mass customization, among other things, as CEO Robert Keane explained in his annual letter to investors.
The group’s total sales in fiscal 2023 increased by seven percent to now $3.08 billion (previous year: $2.88 billion); gross profit rose by three percent to $1.439 billion in the same period. Both figures mark new records for Cimpress – and this despite, according to Keane in the latest annual report, “a challenging macroeconomic environment.”
Adjusted EBITDA also turned upward: After being significantly lower than in the same period in fiscal 2022 at $281.1 million, it now rose 21% to $339.83 million.
The renewed positive development of Cimpress is obviously also pleasing to shareholders, since the share price has climbed steadily over the last ten months and is currently quoted at 64.00 euros, after first falling sharply in the wake of the pandemic and global economic difficulties and then following more of a rollercoaster course.
Cost savings announced
In view of the restructuring, investments, and cutbacks of recent years – among other things, the Group switched to a decentralized organizational structure, changed its technology platform, acquired Crello (now VistaCreate) and Depositphotos, and exited its Japan and China business – the 2023 financial year was comparatively quiet for the top dog in online printing. In March of this year, the Group announced cost savings: 500 jobs were to be cut by the end of June, mainly in the Vista business area and in the central Cimpress teams. Together with other non-compensation-related cost-cutting measures, the company expected to be able to save up to 100 million US dollars a year before taxes, it said at the time.
As far as the business figures of the individual business units are concerned, the strategic measures taken in recent months and years at least appear to have paid off, as sales and gross profits increased in equal measure in all business units, as the annual report for fiscal 2023 shows.
Development in the individual business areas
Vista: After growth in Cimpress’ largest business unit, Vista, fell short of the Group’s expectations in fiscal 2022, the Group’s top management expressed satisfaction with the current figures. Sales totaled $1.61 billion, up seven percent from the previous year. EBITDA was again well above the previous year’s figure at $224 million.
“The year-over-year comparison is striking and highlights Vista’s improved pricing, reduced cost base, increased focus on capital expenditures and shift of development resources from technology migration to activities such as user experience improvement, experimentation and new product introductions,” Robert Keane commented.
Upload & Print: The Cimpress business unit, which comprises seven European companies – including WirMachenDruck, druck.at and pixartprinting – closed the 2023 financial year with total sales of $925.38 million and EBITDA of $131 million, thus once again achieving record figures; and this despite currency fluctuations causing losses of more than seven million dollars in EBITDA.
In organizational terms, the business unit is divided into “Printbrothers” (WirMachenDruck, druck.at and drukwerkdeal) and “The Print Group” (pixartprinting, exaprint, tradeprint.co.uk and easyflyer). “Printbrothers” grew the most in the 2023 financial year, by 10% to $578 million in sales and a gross profit of $152 million. The companies of “The Print Group” achieved concurrent annual sales of $347 million (+5% growth) with a gross profit of $123 million.
National Pen: Cimpress’ promotional products business grew 7% in fiscal 2023, slightly less than the previous year’s 9% growth, but still comes in at $366 million in total revenue and $192 million in gross profit (+6% over fiscal 2022). EBITDA fell from $27 million to $24 million, though Cimpress says currency fluctuations also had a significant effect here, depressing EBITDA by more than $8 million.
In June, the business unit was also able to complete the relocation of its European production site from Ireland to the Czech Republic, which, however, had sometimes resulted in double costs until the end of fiscal 2023.
All other Businesses: Under this term, Cimpress combines the business of its “BuildASign” brand and its early-stage investments. Total revenue in fiscal 2023 was $213 million (+4%), gross revenue was $96 million (+/- 0%), and EBITDA was $25 million (previous year: $22 million). Whereby BuildASign represents the lion’s share of this business unit with $187 million in revenue and EBITDA of $28 million. The sale of the China business in particular had an impact on early-stage investments. By contrast, the businesses in Brazil and India are expected to break even in the coming year.
Biggest investments in Vista and mass customization platform
In addition to the actual business figures, it is also interesting to see in which areas Cimpress invests and how much. It is striking that not only in fiscal year 2023, but also in previous years, most of the money invested went into Vista and the mass customization platform. It’s no wonder that Robert Keane sees the greatest growth potential here for the future and is optimistic about the 2024 financial year. In the future, the company will not only benefit from the new technology platforms, which will be reflected in a better customer experience, among other things – it also wants to expand mass customization to new products and categories.
