Cimpress is moving its key Vistaprint division from low cost business cards and simple print products towards to be “the expert design and marketing partner” for small businesses instead of discount led customers.
In the aftermath of pandemic and lockdowns profit and revenue for Vista is currently depressed says CEO Robert Keane. This is more than balanced by business levels in other operations, Upload and Print, National Pen, Build Sign and Print, it business in Brazil. It resulted in an increase in revenue for the 2022 financial year of $2.89 billion ($2.58 billion), but a squeeze on profits with Ebitda slipping to $281 million ($349 million).
It is closing its operations in China and Japan where, says Keane, “there is long term opportunity, but which has not been profitable”. The Upload and Print division, which includes Tradeprint in the UK and Pixartprinting in Italy, produced an increase in revenue to $856 million ($696 million) and in Ebitda to $125 million ($86 million).
Cimpress increased the number of new customers for Upload and Print, driven by the growing realisation that the company can offer the benefits of scale on pricing, meaning it makes sense for printers to shift production to Cimpress. Keane describes this as “scale driven cost position, global procurement leverage and technology”.
The company also leveraging its purchasing power for investment in technology, shifting the focus of its print production platforms from litho and HP Indigo towards inkjet. A year ago Keane announced a closer partnership with Canon following the success of three Prostream 1000s at the Pixart plant near Venice. A the time he declared: “We believe inkjet technology has an important role to play, bringing flexibility, efficiency and a positive step to reduce waste, contributing to the achievement of our sustainability goals.” Further inkjet investments have followed, while HP has supplied Indigo 100Ks to the business.
Looking forwards Cimpress says it faces challenges in terms of raw material costs and supply, energy, shipping and wage pressure.
It is completing the revamp of the technology underpinning its Mass Customisation Platform to improve the ability to integrate with best in class third party Saas applications. What these might be it does not explain.
It does say that it will be making close integration between Vistaprint and recent acquisitions 99Design and DepositPhoto a priority. This would be needed for the transition from low value customers to small businesses turning to Vista for design and marketing as well as print expertise.
The effect will be profitability for Vista in 2023 and growing success thereafter. “Results for Vista are well below what we believe to be their potential,” says Keane. Shareholders and investors will be watching to ensure that Cimpress can achieve this potential.
