XML 70 R19.htm IDEA: XBRL DOCUMENT
v3.19.3

Segment Information | 3 Months Ended
--- | ---
Sep. 30, 2019
Segment Reporting [Abstract] |
Segment Information | Segment Information Reportable Segment Change Our operating segments are based upon the manner in which our operations are managed and the availability of separate financial information reported internally to the Chief Executive Officer, who is our Chief Operating Decision Maker (“CODM”) for purposes of making decisions about how to allocate resources and assess performance. During the first quarter of fiscal 2020, we revised our internal organizational and reporting structure leading to changes in our Vistaprint and All Other Businesses reportable segments. Our Vistaprint Corporate Solutions, Vistaprint India, and Vistaprint Japan businesses, which were previously aggregated based on materiality in our All Other Businesses, are now directly managed within the Vistaprint business. These businesses are close derivatives or adjacencies of the Vistaprint business and leverage the Vistaprint brand, customers, technology, and/or other assets. This change in reporting structure will position them closer to the Vistaprint operations, capabilities, and resources. We have revised our presentation of all prior periods presented to reflect our revised segment reporting. As of September 30, 2019, we have numerous operating segments under our management reporting structure which are reported in the following five reportable segments:
• | Vistaprint - Includes the operations of our global Vistaprint websites and our Webs-branded business, which is managed with the Vistaprint-branded digital business in the previously listed geographies. Also included is our Vistaprint Corporate Solutions business which serves medium-sized businesses and large corporations, as well as a legacy revenue stream with retail partners and franchise businesses.
• | PrintBrothers - Includes the results of our druck.at, Printdeal, and WIRmachenDRUCK businesses.
• | The Print Group - Includes the results of our Easyflyer, Exagroup, Pixartprinting, and Tradeprint businesses.
• | National Pen - Includes the global operations of our National Pen business, which manufactures and markets custom writing instruments and promotional products, apparel and gifts.
• | All Other Businesses - Includes a collection of businesses grouped together based on materiality:
◦ | BuildASign is an internet-based provider of canvas-print wall décor, business signage and other large-format printed products, based in Austin, Texas.
◦ | Printi is an online printing leader in Brazil, which offers a superior customer experience with transparent and attractive pricing, reliable service and quality.
◦ | VIDA is an innovative startup that brings manufacturing access and an e-commerce marketplace to artists, thereby enabling artists to convert ideas into beautiful, original products for customers, ranging from custom fashion, jewelry and accessories to home accent pieces.
◦ | YSD is a startup operation that provides end-to-end mass customization solutions to brands and IP owners in China, supporting multiple channels including retail stores, websites, WeChat and e-commerce platforms to enhance brand awareness and competitiveness, and develop new markets.
Central and corporate costs consist primarily of the team of software engineers that is building our mass customization platform; shared service organizations such as global procurement; technology services such as hosting and security; administrative costs of our Cimpress India offices where numerous Cimpress businesses have dedicated business-specific team members; and corporate functions including our Board of Directors, CEO, and the team members necessary for managing corporate activities, such as treasury, tax, capital allocation, financial consolidation, internal audit and legal. These costs also include certain unallocated share-based compensation costs. Segment Profit Change During the first quarter of fiscal 2020, we changed our segment profitability measure to an adjusted EBITDA metric. The financial metric that we use to hold our businesses accountable on an annual basis is unlevered free cash flow. Historically, we have reported segment profit based on adjusted net operating profit; however, this is not a direct input to unlevered free cash flow. We believe this change simplifies both our internal and external reporting, while also increasing the focus on a profitability metric that is a direct input into our internal operating measure, to our steady-state free cash flow analysis that we report annually and to our estimates of intrinsic value per share. The primary difference between the segment profit we previously reported and the revised metric is depreciation and amortization. The prior adjusted NOP-based metric only removed amortization of acquired intangibles, and the new segment EBITDA metric removes all depreciation and amortization, except for depreciation expense related to our Waltham, Massachusetts lease, which we treat in our historical results as operating expense. The new segment EBITDA metric does include the cost of long-term incentive programs, including share-based compensation, just as the prior adjusted NOP-based metric. For awards granted under our 2016 Performance Equity Plan, the PSU expense value is based on a Monte Carlo fair value analysis and is required to be expensed on an accelerated basis. In order to ensure comparability in measuring our businesses' results, we allocate the straight-line portion of the fixed grant value to our businesses. Any expense in excess of the amount as a result of the fair value measurement of the PSUs and the accelerated expense profile of the awards is recognized within Central and corporate costs. All expense or benefit associated with our supplemental PSUs is recognized within Central and corporate costs. Our definition of segment EBITDA is GAAP operating income excluding certain items, such as depreciation and amortization (with the exception of depreciation expense associated with our Waltham, Massachusetts lease for periods prior to our adoption of the new leasing standard on July 1, 2019), expense recognized for contingent earn-out related charges including the changes in fair value of contingent consideration and compensation expense related to cash-based earn-out mechanisms dependent upon continued employment, share-based compensation related to investment consideration, certain impairment expense, and restructuring charges. For historical periods presented, a portion of the interest expense associated with our Waltham, Massachusetts lease is included as expense in segment EBITDA and allocated based on headcount to the appropriate business or corporate and global function. The interest expense represents a portion of the cash rent payment and is considered an operating expense for purposes of measuring our segment performance. Beginning in fiscal 2020, as part of our adoption of the new leasing standard, the accounting treatment for our Waltham, Massachusetts lease has changed to an operating lease, so the expense associated with this lease is reflected in operating income and no longer requires an adjustment to segment EBITDA. We do not allocate non-operating income, including realized gains and losses on currency hedges, to our segment results. Our All Other Businesses reportable segment includes businesses that have operating losses as they are in the early stage of investment relative to the scale of the underlying businesses, which may limit its comparability to other segments regarding segment EBITDA. Our balance sheet information is not presented to the CODM on an allocated basis, and therefore we do not present asset information by segment. We do present other segment information to the CODM, which includes purchases of property, plant and equipment and capitalization of software and website development costs, and therefore include that information in the tables below. Revenue by segment is based on the business-specific websites or sales channel through which the customer’s order was transacted. The following tables set forth revenue by reportable segments, as well as disaggregation of revenue by major geographic regions and reportable segments.
| Three Months Ended September 30,
| 2019 |  | 2018
Revenue: |  |  |
Vistaprint (1) | $ | 343,171 |  |  | $ | 345,320 |
PrintBrothers (2) | 109,290 |  |  | 101,389 |
The Print Group (3) | 72,258 |  |  | 71,000 |
National Pen (4) | 70,163 |  |  | 65,971 |
All Other Businesses (5) | 42,276 |  |  | 7,715 |
Total segment revenue | 637,158 |  |  | 591,395 |
Inter-segment eliminations | (3,199 | ) |  | (2,414 | )
Total consolidated revenue | $ | 633,959 |  |  | $ | 588,981 |
_____________________ (1) Vistaprint segment revenues include inter-segment revenue of $1,328 and $1,249 for the three months ended September 30, 2019 and 2018, respectively. (2) PrintBrothers segment revenues include inter-segment revenue of $243 and $359 for the three months ended September 30, 2019 and 2018, respectively. (3) The Print Group segment revenues include inter-segment revenue of $432 and $56 for the three months ended September 30, 2019 and 2018, respectively. (4) National Pen segment revenues include inter-segment revenue of $981 and $750 for the three months ended September 30, 2019 and 2018 respectively. (5) All Other Businesses segment revenues include inter-segment revenue of $215 for the three months ended September 30, 2019. There was no inter-segment revenue for the three months ended September 30, 2018. Our All Other Businesses segment includes the revenue from our BuildASign acquisition from October 1, 2018.
| Three Months Ended September 30, 2019
| Vistaprint |  | PrintBrothers |  | The Print Group |  | National Pen |  | All Other |  | Total
North America | $ | 247,085 |  |  | $ | — |  |  | $ | — |  |  | $ | 41,542 |  |  | $ | 35,406 |  |  | $ | 324,033 |
Europe | 74,458 |  |  | 109,047 |  |  | 71,826 |  |  | 22,313 |  |  | — |  |  | 277,644 |
Other | 20,300 |  |  | — |  |  | — |  |  | 5,327 |  |  | 6,655 |  |  | 32,282 |
Inter-segment | 1,328 |  |  | 243 |  |  | 432 |  |  | 981 |  |  | 215 |  |  | 3,199 |
Total segment revenue | 343,171 |  |  | 109,290 |  |  | 72,258 |  |  | 70,163 |  |  | 42,276 |  |  | 637,158 |
Less: inter-segment elimination | (1,328 | ) |  | (243 | ) |  | (432 | ) |  | (981 | ) |  | (215 | ) |  | (3,199 | )
Total external revenue | $ | 341,843 |  |  | $ | 109,047 |  |  | $ | 71,826 |  |  | $ | 69,182 |  |  | $ | 42,061 |  |  | $ | 633,959 |
| Three Months Ended September 30, 2018
| Vistaprint |  | PrintBrothers |  | The Print Group |  | National Pen |  | All Other |  | Total
North America | $ | 246,121 |  |  | $ | — |  |  | $ | — |  |  | $ | 38,558 |  |  | $ | 1,727 |  |  | $ | 286,406 |
Europe | 76,671 |  |  | 101,030 |  |  | 70,944 |  |  | 21,036 |  |  | — |  |  | 269,681 |
Other | 21,279 |  |  | — |  |  | — |  |  | 5,627 |  |  | 5,988 |  |  | 32,894 |
Inter-segment | 1,249 |  |  | 359 |  |  | 56 |  |  | 750 |  |  | — |  |  | 2,414 |
Total segment revenue | 345,320 |  |  | 101,389 |  |  | 71,000 |  |  | 65,971 |  |  | 7,715 |  |  | 591,395 |
Less: inter-segment elimination | (1,249 | ) |  | (359 | ) |  | (56 | ) |  | (750 | ) |  | — |  |  | (2,414 | )
Total external revenue | $ | 344,071 |  |  | $ | 101,030 |  |  | $ | 70,944 |  |  | $ | 65,221 |  |  | $ | 7,715 |  |  | $ | 588,981 |
The following table includes segment EBITDA by reportable segment, total income (loss) from operations and total income (loss) before income taxes.
| Three Months Ended September 30,
| 2019 |  | 2018
Segment EBITDA: |  |  |  |  |
Vistaprint | $ | 80,580 |  |  | $ | 59,994 |
PrintBrothers | 10,777 |  |  | 10,571 |
The Print Group | 13,634 |  |  | 11,846 |
National Pen | (9,850 | ) |  | (16,468 | )
All Other Businesses | 1,717 |  |  | (4,722 | )
Total segment EBITDA | 96,858 |  |  | 61,221 |
Central and corporate costs | (26,930 | ) |  | (29,287 | )
Depreciation and amortization | (42,535 | ) |  | (40,718 | )
Waltham, MA lease depreciation adjustment (1) | — |  |  | 1,030 |
Certain impairments and other adjustments | 176 |  |  | 87 |
Restructuring-related charges | (2,190 | ) |  | (170 | )
Interest expense for Waltham, MA lease (1) | — |  |  | 1,849 |
Total income (loss) from operations | 25,379 |  |  | (5,988 | )
Other income, net | 15,674 |  |  | 10,252 |
Interest expense, net | (15,087 | ) |  | (13,777 | )
Income (loss) before income taxes | $ | 25,966 |  |  | $ | (9,513 | )
___________________ (1) Upon the adoption of the new leasing standard on July 1, 2019, our Waltham, Massachusetts lease, which was previously classified as build-to-suit, is now classified as an operating lease under the new standard. Therefore, the Waltham depreciation and interest expense adjustments that were made in comparative periods will no longer be made beginning in the first fiscal quarter of 2020, as any impact from the Waltham lease will be reflected in operating income. Refer to Note 2 for additional details.
| Three Months Ended September 30,
| 2019 |  | 2018
Depreciation and amortization: |  |  |
Vistaprint | $ | 16,275 |  |  | $ | 17,321 |
PrintBrothers | 5,255 |  |  | 6,413 |
The Print Group | 6,233 |  |  | 7,731 |
National Pen | 5,581 |  |  | 5,124 |
All Other Businesses | 5,973 |  |  | 583 |
Central and corporate costs | 3,218 |  |  | 3,546 |
Total depreciation and amortization | $ | 42,535 |  |  | $ | 40,718 |
| Three Months Ended September 30,
| 2019 |  | 2018
Purchases of property, plant and equipment: |  |  |
Vistaprint | $ | 4,505 |  |  | $ | 12,056 |
PrintBrothers | 331 |  |  | 1,729 |
The Print Group | 4,105 |  |  | 1,996 |
National Pen | 2,016 |  |  | 4,727 |
All Other Businesses | 1,775 |  |  | 285 |
Central and corporate costs | 1,461 |  |  | 233 |
Total purchases of property, plant and equipment | $ | 14,193 |  |  | $ | 21,026 |
| Three Months Ended September 30,
| 2019 |  | 2018
Capitalization of software and website development costs: |  |  |
Vistaprint | $ | 6,665 |  |  | $ | 7,258 |
PrintBrothers | 331 |  |  | 287 |
The Print Group | 451 |  |  | 495 |
National Pen | 836 |  |  | 900 |
All Other Businesses | 963 |  |  | 90 |
Central and corporate costs | 3,225 |  |  | 2,203 |
Total capitalization of software and website development costs | $ | 12,471 |  |  | $ | 11,233 |
The following table sets forth long-lived assets by geographic area:
| September 30, 2019 |  | June 30, 2019
Long-lived assets (1): |  |  |  |  |
United States | $ | 170,978 |  |  | $ | 57,118 |
Netherlands | 105,812 |  |  | 73,601 |
Canada | 78,672 |  |  | 73,447 |
Switzerland | 65,353 |  |  | 57,488 |
Italy | 44,613 |  |  | 43,203 |
Jamaica | 21,253 |  |  | 21,267 |
Australia | 21,111 |  |  | 20,749 |
France | 21,624 |  |  | 18,533 |
Japan | 16,937 |  |  | 17,768 |
Other | 109,211 |  |  | 79,006 |
Total | $ | 655,564 |  |  | $ | 462,180 |
___________________ (1) Excludes goodwill of $711,670 and $718,880, intangible assets, net of $245,514 and $262,701, and deferred tax assets of $57,527 and $59,906 as of September 30, 2019 and June 30, 2019, respectively. Build-to-suit lease assets of $124,408 are excluded for the year ended June 30, 2019, and upon our adoption of ASC 842 on July 1, 2019, our Waltham, MA build-to-suit lease has been reclassified as an operating lease and the build-to-suit lease balance is zero. As of September 30, 2019, all operating lease assets are recognized within the balances above. Refer to Note 2 for additional details.

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration