Vistaprint Shares Plunge 16% As Q3 Results Miss Estimates, Adjusts 2014 Outlook

(RTTNews) - Shares of Vistaprint N.V. (VPRT) plummeted nearly 16 percent in extended trading on Tuesday after the on-line marketing products and services company reported results for the third quarter that significantly missed analysts' expectations.

The company also reported a profit for the quarter that plunged from last year, reflecting a revenue drop and lower operating margins amid higher expenses. The company also narrowed its earnings guidance range for the full-year 2014, while raising annual revenue outlook.

"This is the first quarter in the past 14 years in which our revenue declined year over year. While we are not content with this performance, our underlying value creation was much better than our headline financial numbers," President and CEO Robert Keane said in a statement.

The Venlo, the Netherlands-based company reported net income of $1.38 million or $0.04 per share for the third quarter, higher than $5.87 million or $0.17 per share in the prior-year quarter.

Excluding items, adjusted net income for the quarter was $8.27 million or $0.24 per share, compared to $16.93 million or $0.48 per share in the year-ago quarter.

On average, ten analysts polled by Thomson Reuters expected the company to report earnings of $0.59 per share for the third quarter. Analysts' estimates typically exclude special items.

Revenue for the quarter edged down 1 percent to $286.19 million from $287.68 million in the same quarter last year, and missed ten Wall Street analysts' consensus estimate of $310.73 million.

North America revenues grew 2 percent to $166.12 million, while Europe revenues decreased 4 percent to $104.18 million, and revenues for most of world decreased 3 percent to $15.89 from last year.

Operating margin for the quarter contracted 160 basis points to 1,8 percent from last year as gross margin declined 80 basis points.

Additionally, the company noted that it agreed to exit its 45 percent minority equity interest in China's Namex Ltd. to the majority shareholder. The company expects to record a charge of up to $0.40 per share related to the minority investment in China.

Looking ahead to fiscal 2014, the company projects adjusted earnings in a range of $2.70 to $2.85 per share, compared to the prior forecast of $2.68 to $2.93 per share. However, the company raised its revenue guidance to between $1.25 billion and $1.27 billion from the previous outlook between $1.235 billion and $1.265 billion.

Street is currently looking for full-year 2014 earnings of $2.86 per share on annual revenues of $1.25 billion.

The company also expects to make capital expenditures of about $70 million to $80 million in fiscal 2014.

"Based upon significant customer research that we have conducted over the past three years we are shifting our value proposition away from the deep discounts and free-offer direct marketing that characterized the Vistaprint of the past toward being simply the best way for business owners to market their business. We are making this shift in order to expand into the large market opportunity that lies beyond our traditional base of highly price sensitive customers," Keane added.

VPRT closed Tuesday's regular trading session at $53.42, up $3.31 or 6.61% on a volume of 0.77 million shares. However, the stock plummeted $8.42 or 15.76% in after-hours trade.