investor day 11 15 v3 - iis windows...

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VistaPrint © 2007 1

Investor Day

November 15, 2007

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Safe HarborThis presentation contains information about future expectations, plans and prospects of our management that constitute forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995, including, but not limited to, statements concerning the expected growth and development of our business including financial guidance, operating performance, our margins, our market position, investments made or to be made in our business, and our ability to successfully attract and retain customers. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors including, but not limited to, our ability to attract customers and to retain customers and to do so in a cost-effective manner, willingness of purchasers of graphic design services and printed products to shop online, failure of our investments, unexpected increases in our use of funds, failure to increase our revenue and keep our expenses consistent with revenues, failures of our web sites or network infrastructure, failure to maintain the prices we charge for our products and services, the inability of our manufacturing operations to meet customer demand, and other factors that are discussed in our Form 10-K for the year-ended June 30, 2007, our Form 10-Q for the quarter-ended September 30, 2007, and other documents periodically filed with the SEC.

In addition, the statements in this presentation represent our expectations and beliefs as of the date of this presentation. We anticipate that subsequent events and developments may cause these expectations and beliefs to change. We specifically disclaim any obligation to update any forward-looking statements. These forward-looking statements should not be relied upon as representing our expectations or beliefs as of any date subsequent to the date of this presentation.

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Agenda

Robert S. Keane President, CEO and ChairmanTrynka Shineman SVP North American Marketing

Mike Ewing SVP Global Partnerships

Wendy Cebula EVP & Chief Operating Officer

Harpreet Grewal EVP & Chief Financial Officer

Q&A

VistaPrint © 2007 4

Robert S. Keane

President, CEO and Chairman

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5

Small Office and Home Office (SOHO) Businesses

6

SOHO Businesses are Very Small Businesses

Source: US SBA

Non employer

1 to 4 FTEs

5 to 9 FTEs

Part time only3%

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7

But there are a Lot of SOHOs

Canada

US

EU

~50 Million SOHOs in Europe and North America

Sources: European Commission Observatory of European SMEs,US Census Bureau, Statistics Canada, Eurostat and VistaPrint estimates

8

Our Vision

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9

10

Expanding Value Proposition

“VistaPrint lowered our printing costs…”

Anita Mo, Graphic Designer

“I mailed them and got orders…”

Lisa Rhodes, OwnerHome based business

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11

Business Model

• Produce in volume

• Sell in small quantities

• Broadly applicable

VistaPrint

Volume

Cost per Unit

Low Volume Markets

High VolumeMarkets

12

Fiscal Year Revenues*

$360 -$380

$5 $17$35

$59

$256

$152

$91

'01 '02 '03 '04 '05 '06 '07 '08Guidance

*Millions, FYE June

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13

Guidance

Net Profit* Growth$51 - $55

$27

$19

$5$3

'01 '02 '03 '04 '05 '06 '07 '08

* Millions, FYE June, excluding SBC and contract termination

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Helping Small Business Market Their Business

Presentation Folders

Letterhead

Envelopes

Postcards

Note Pads

T-Shirts

Rubber Stamps

Logo design

Checksvia partnershipMailing services Sticky Notes

Business Cards

Pens

CreativeServices

From the desk ofTiffany Hanson

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Proprietary Capabilities

Direct Marketing • Customer acquisition

• Over 300k / month at low cost per customer• Sophisticated testing systems and analytically-driven culture

Software and Network Operations• Seamless software integration of all aspects of the business

• Extensive internal development teams and proprietary technology

Computer Integrated Manufacturing • Automated workflow and production environment

• >26,000 custom-designed, custom-produced orders per day

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Volume

ValueRepeat

• Marketing capabilities and economics• Proprietary software• Engineering, automation• High-volume production & service• Channel and geographic reach

Increased profitper customer• Cross-selling• Up-selling• Repeat-purchases• Brand equity

• Content & format breadth• Low costs• Service levels

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17

Volume: Average Orders Processed Per Day*

5 6 79 9 9

1214 15 16

1821 22

26

Q4 Q1FY 05

Q2 Q3 Q4 Q1FY 06

Q2 Q3 Q4 Q1FY 07

Q2 Q3 Q4 Q1 FY08

* Thousands, FYE June

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Volume: Non-US Order Growth

Q1 '03 Q1 '04 Q1 '05 Q1 '06 Q1 '07 Q1 '08

Other non-US

Top 4 non-US (France, Germany, Netherlands, & UK)

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Volume: Unique Customers Purchasing Per Fiscal Year*

0.4

1.01.3

1.62.0

4.1

2.7

'01 '02 '03 '04 '05 '06 '07

* Millions, FYE June

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Value: Amanda Murphy, SOHO Customer

VistaPrint makes it easy to get great looking materials that I can afford.

“1,000 Datasheets $243.49

1,000 Postcards $74.99

5,000 Business Cards $94.97

420 Return Address Labels $19.99

200 Thank You Cards $54.73

Total $488.17

”

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Repeat: Average Revenue per Customer Purchasing in the Fiscal Year*

$12$17

$27

$36

$44

$53$58

'01 '02 '03 '04 '05 '06 '07

* Excluding Referral Fees, FYE June

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Repeat Customer Revenues*

$10$12

$15 $16 $17$22

$26$28

$32

$41$44 $45

$51

Q1FY'05

Q2 Q3 Q4 Q1FY'06

Q2 Q3 Q4 Q1FY'07

Q2 Q3 Q4 Q1FY'08

* Millions, Excluding Referral Fees

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Land Grab

• Volume: expand market share lead– Acquire as many customers as possible

– Build management and systems infrastructure to scale

• Value: improve customer value proposition– Reduce unit production costs and share savings with customers

• Repeat: raise per-customer revenue– More products, services, and content at higher service levels

• Meet our EPS commitments, then reinvest excess

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Broad and Deep Leadership Team

Over 25 executives at Vice President and above levels• Average over 20 years of experience

Highly sophisticated technologists and manufacturing experts• 150 degreed engineers

Direct marketing talent: analytics, creative, media placement

Comparable expertise in HR, Finance and other functions

Continuously recruiting experts from large-scale companies

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Agenda

Robert S. Keane President, CEO and Chairman

Trynka Shineman SVP North American MarketingMike Ewing SVP Global Partnerships



Q&A

26

Trynka Shineman

SVP North American Marketing Marketing Techniques and New Product Introductions

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Small Businesses Want to Look Like Big Businesses

Ken and Marge GaragiolaManaging Partner and AdministratorCentury 4 Retail Advisors, LLCEgg Harbor Township, New Jersey

We went to VistaPrint We went to VistaPrint for our brand identity.for our brand identity.“ ”

2828

Compelling Value with First Time Profitability

AOV of new Free Business Card orders is over $17• All pay shipping and processing fees

• A third take an additional product

• Many pay an $9.99 customization fee

• Some select other upgrades Plus – over 2 Billion impressions including the VistaPrint brand and message

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New Customer Acquisitions*

329 351 352388 399 407

450528 564

603687

800850

975

Q4 Q1FY'05

Q2 Q3 Q4 Q1FY'06

Q2 Q3 Q4 Q1FY'07

Q2 Q3 Q4 Q1FY'08

*Approximate number of new customers acquired per quarter, in thousands

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New Visitors’ Home Page

• Highlight lead acquisition offer showing compelling value

• Maximize conversion rate of first time visitors

• Product & service awareness

• Merchandising

• User consistency and ease

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Returning Visitor Home Page

• Maximize value of return visits

• Easy to resume a design in progress and complete it

• Increase revenue per customer by cross-selling matching items

• Provide easy access to post-purchase information such as shipping dates, prior order quantities, addresses, etc.

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Automated Graphic Design & Cross Selling

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3333

Website Improvements Raise Session Productivity

Idea database

Analytic tools

Customer research

Competitive research

Employees

Prioritize &

Build

>50 split-run tests per release

Rollout

Each release improves conversion and cross selling efficiency

34Company Confidential – VistaPrint © 2007 34

Direct Marketing at VistaPrint

Rigorous, repeated, and relentless testing

Test • Analyze every program’s results against control group and/or

hypothesis• Robust channel, offer, and website testing reduces risk, raises

efficiency, and visibility into our businessInvest

• Apply lessons learned• Quickly scale positive results to maximize growth, shareholder value,

and competitive advantage• Increase spending in most profitable programs, no fixed ‘budget’

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New Channels Accelerate Customer Acquisition

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Channel Optimization Improves Performance

First page competition are postcard-focused companies.

First page competition are postcard-focused companies.

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Expansion Broadens ReachAustralia

Belgium

Denmark

Europe

France

Germany

Ireland

Japan

Italy

Netherlands

New Zealand

Norway

Germany

Poland

Spain

Switzerland

Sweden

United Kingdom

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Catalogs Increase Life Time Value

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One to One Targeting Improves Response

4040

Trial Offers Drive Product Adoption

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New Products

42

SOHO Marketing Spending Survey

Business Cards

Brochures, Flyers

Letterhead, Envelopes

Holiday Cards

Mailing Services

Website Design

Search Marketing

Online Directories

Email Marketing

Promotional Gifts

Custom Printed Apparel

Signage

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Diversifying Product Mix

FY’03 FY’07

T-ShirtSticky Notes

EnvelopesNotepads

Business Card HoldersRubber Stamps

Business Cards

Postcards

Consumer Products

Magnets

Other

Brochures

RAL

Letterhead

Business Cards

Postcards

Consumer ProductsOther

Brochures

RAL Letterhead

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New Product Testing Criteria

CompetitiveLandscape

Cross Selling

Customer Demand

CompetitiveAdvantage

New Products

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New Product Demand Rankings

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Competitive Advantage Matrix

Quantity Content X-selling Price Patents Back-End Attributes/Quality

Product K

Product A

Product B

Product C

Product D

Product E

Product F

Product G

Product H

Product I

Product J

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New Product: Pens

• Custom pen has high perceived value

• Leverage power of matching content full color printing

• Production technology margins improve with volume

4848

New Product: T-Shirts

• Leverage power of matching content full color printing

• Scale and engineering improve manufacturing productivity

• Digital printing enables small quantities, often as few as 1

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Going Forward, More of the Same

Sell better• Multiple site improvements

Know our customers better• More split run testing

• More segmentation and differentiation

Continue to accelerate new customer acquisition• Better European targeting

• New channels: direct mail and telemarketing

• New product introductions

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Agenda


Trynka Shineman SVP North American Marketing

Mike Ewing SVP Global PartnershipsWendy Cebula EVP & Chief Operating Officer


Q&A

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Mike Ewing

SVP Global Partnerships

Partnerships

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3 Types of PartnershipGlobal Partnerships

Expand Distribution Channels

Wholesale Retail

Business Solutions

Expand Scope of Product and

Services

Advertising

Referral Partners

StrategicPartnerships

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5353

Strategic Partnerships

Offline sales targets, illustrative

Online sales targets, illustrative

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Business Solutions

Value, sophisticated graphic design, convenience, need to

compete with larger companies

Distributed billing &Brand integrity

Business Solutions

Value, sophisticated graphic design, convenience, need to

compete with larger companies

SOHO

Sales Targets: franchises, independent sales channels, independent distributors. Illustrative list:

Needs

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Referral Partners

SOHO Marketing Services

SOHO Operational Services

Other Products and Services

56

Referral Partners: In Context Marketing

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57

Expanding Scope

Marketing Software Serviceoperations Production

Referral Partners

Channel Partners

Referral Partners

Channel Partners

VistaPrint

58

Summary of Partnerships at VistaPrint

Investing ahead of the curve

Substantial opportunity

Good economics

Technology enabled…

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Agenda




Wendy Cebula EVP & Chief Operating OfficerHarpreet Grewal EVP & Chief Financial Officer

Q&A

60

Wendy Cebula

EVP and COO

Technology and Manufacturing Review

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Technology and Manufacturing Team: Recent Leadership Recruiting Success

• Chief SW Architect: Former chief SW architect at Fidelity Investments

• SVP Cap Dev: Former CIO, Sapient

• SVP Manufacturing Engineering: Former CTO, $1 billion automationengineering and equipment firm

• VP Generate Demand: Former VP at Trilogy Software

• Director of Operations, Windsor: 15+ years of manufacturing leadership at Kodak

• Plant Director, Windsor: 20+ years of manufacturing experience in Toyota Production System for tier-1 auto supplier

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Technology Supports Our Virtuous Cycle

Volume

ValueRepeat

• Proprietary software• Engineering, integration• Automation• Utilization and customization

• Test & invest• New products• New channels • New geographies• Brand strength

• Low prices, high quality• Reliability, satisfaction• Trust

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Technology Enables Our Business

Generate Demand• Marketing and Global Partnerships, New Products, Modular Graphic Design

Fulfill Demand• Manufacturing, Service Center Operations, Scheduling, Logistics

Support the Business• Finance, HR, Intellectual Property

Technology Operations• Network Operations, Internal Support

Automated orderaggregation& cost optimization

High-volume computer integrated manufacturing

Software-driven order assembly& package addressing

Cost and speed optimized order shipment

Interactive customer service & graphic design help

Customer designs, reviews & orders online

Decision support systems, testing architecture

64

Split-Runs Drive Marketing Efficiency

High volume of sessions creates statistically significant results within hours, not weeks

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65

Generate Demand: VistaStudio

66

Modular Graphics Enable Automated Cross-Selling and New Product Generation

From the desk ofTiffany Hanson

Post CardPost Card

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67

CustomerCustomer

Generate Demand: Graphic Design Assistance

Internet

VistaPrint DesignVistaPrint Design& Service Center& Service Center

68

Generate Demand: Business Solutions Micro-Sites

35

69

Generate Demand: Strategic Partnerships

70

Fulfill Demand: Complex Scheduling Algorithms Drive Production Efficiency

36

71

Support The Business: Intellectual Property

13 Issued US Patents• 5 relate to Generating Demand

• Computerized pre-press

• Modular graphic-design

• Dynamic document editing in a browser

• 8 relate to Fulfilling Demand• Ganging and managing print jobs

• Consistency between printed products and product images viewed by users

More than 40 patents pending

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38

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Manufacturing Summary

>26,000 custom orders per day, on average

Highly automated, efficient front-end

Much more than presses

Ongoing capacity increases

• Venlo:• Phase A Jan. 2004

• Phase B April 2006

• Phase C Jan. 2008

• Windsor: • Phase A Sept. 2005

• Phase B Oct. 2006

• Phase C…

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77

Schematic Diagram of Windsor

MultiMulti--Part Part OrderOrder

BinningBinning

ShippingShipping

Conveyor beltConveyor belt

OffsetOffsetPressPressCellCell



OtherOtherCellCell

DigitalDigitalPressPressCellCell

DigitalDigitalPressPressCellCell

78

Manufacturing FacilitiesWindsor Venlo

40

79

Windsor press

80

Venlo Press

41

81

Venlo Interior

82

Line of Digital Presses

42

83

Technology Summary

Strong leadership team

Technology-enabled business

Volume and proprietary software enable cost advantages

Highly visible data enable fact & analytics-based decisions

84

Agenda





Harpreet Grewal EVP & Chief Financial OfficerQ&A

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85

Harpreet Grewal

EVP and CFO

Financial Review

86

Financial Overview

Solid and consistent execution• Quarterly revenue, non-GAAP net income and EPS, repeat customer

revenues, non-US revenue growth, cash flow, customer acquisition costs, operating and free cash flow

Cadence and predictability of our business• Quarterly and Trailing Twelve Month (TTM) results

Financial strategy to build a transformational company• Invest for the future while delivering on stated EPS targets

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87

$36.4$41.6

$45.3$50.0

$64.0$69.3 $72.5

$79.5

Q2 '06 Q3 Q4 Q1 '07 Q2 Q3 Q4 Q1 '08

Non-US

US

Solid Execution: High Revenue Growth*

* $, millions

88

$5.8

$7.2 $7.2 $7.3

$10.0$9.3 $9.3

$9.9

Q2 '06 Q3 Q4 Q1 '07 Q2 Q3 Q4 Q1 '08

Solid Execution: Non-GAAP Net Income* Growth

* Excludes SBC, $, millions

45

89

$0.21$0.20$0.20

$0.22

$0.16$0.16$0.16

$0.13

Q2 '06 Q3 Q4 Q1 '07 Q2 Q3 Q4 Q1 '08

Solid Execution: Non-GAAP EPS* Growth

* Excludes SBC and other adjustments, see reconciliation in the appendix

90

64%63%63%64%64%63%63%61%

Q2 Q3 Q4 Q1 '07 Q2 Q3 Q4 Q1 '08

Solid Execution: High Repeat Customer Bookings

46

91

34%32%32%34%30%29%30%29%

Q2 Q3 Q4 Q1 '07 Q2 Q3 Q4 Q1 '08

Solid Execution: Non-US Revenue* Growth

*Revenues from non-US web sites as % of total revenues

92

$14.0

$11.4

$18.5

$14.1

$10.4$11.4

$8.9

$11.1

Q2 '06 Q3 Q4 Q1 '07 Q2 Q3 Q4 Q1 '08

Solid Execution: Strong Operating Cash Flow*

* $, millions

47

93

(3.6)

(7.8)

2.9

(3.4)(4.5)

1.51.0

5.1

Q2 '06 Q3 Q4 Q1 '07 Q2 Q3 Q4 Q1 '08

Solid Execution: Free Cash Flow*

* $, millions

94

Strong Balance Sheet: $104.5 Million in Cash*

$2.7 $4.0$9.2

$34.6

$54.3

$14.3

FY '02 FY '03 FY '04 FY '05 FY '06 FY '07

* As of September 30, 2007** $, millions, excluding FY ’05 contract termination charge

Cash Flow from Operations**

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95

Cadence of our Business: Quarterly & TTMRevenue* and Q2 Guidance**

$117.2$133.7

$152.1

$173.3

$200.9

$228.7

$255.9

$285.4

$313-319

Q2FY'06

Q3 Q4 Q1FY'07

Q2 Q3 Q4 Q1FY'08

Q2**

TTMQuarterly

$36.4$41.6

$45.3$50.0

$64.0$69.3

$72.5

$79.5

$92-98

Q2FY'06

Q3 Q4 Q1FY'07

Q2 Q3 Q4 Q1FY'08

Q2**

$, millions** Guidance as of October 25, 2007

2007 TTM y/y growth range: 65-71%2007 quarterly y/y growth range: 59-76%

96

Cadence of our Business: Quarterly & TTM non-GAAP Net Income* & Guidance**

$5.8

$7.2 $7.2 $7.3

$10.0$9.3 $9.3

$9.9

$12.6-14.4

Q2FY'06

Q3 Q4 Q1FY'07

Q2 Q3 Q4 Q1FY'08

Q2**

$, millions** Guidance as of October 25, 2007

$12.8

$17.8

$23.1

$27.5

$31.7$33.9

$35.9

$38.5

$41-43

Q2FY'06

Q3 Q4 Q1FY'07

Q2 Q3 Q4 Q1FY'08

Q2**

TTMQuarterly

Steady sequential increasesStep function and plateaus

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97

Financial strategy

Three pronged financial strategy• Grow as fast as we can for as long as we can to leverage large

market opportunity• Deliver against strong but fixed net profit and EPS growth objectives• Re-invest additional earning potential back into business to gain

market share and scale-based advantages

Disciplined and analytically-driven investment decisions• Returns (ROIC) remain far in excess of hurdle rate

When growth slows, margins can expand• Leverage from lower expenses relating to marketing, product and

software development, and G&A along with higher capacity utilization enables additional EPS growth

98

FY ’07: Reinvest Excess Earnings

$0.65

$0.70

$0.75

$0.80

$0.85

$0.75

$0.71

Prior guidance as of 10/23/06

$0.84

$0.78

Post Q2 potential run rate range

($0.06)

Select incremental discretionary 2H

investments (manufacturing & org. architecture)

$0.78

Year-end results (07/31/07)

170 bpoperating

margin impact in 2H FY ‘07

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99

Closing Financial Remarks

Large market opportunity

Consistently strong and predictable financial performance

Building a disruptive, industry-changing business institution

Three pronged financial strategy in support of vision

100

Agenda






Q&A

51

101

Q&A

Investor Day

November 15, 2007

102

Appendix A

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103

Financial Guidance

Revenue $92 - $98 mm

Growth over FY ’07 period 42% - 53%

Gross Margins n/a3

GAAP EPS $0.19 - $0.23

Non-GAAP EPS2 $0.27 - $0.31

Cap ex (% of revenue guidance) 17% – 20%

Notes:1. As of October 25, 2007.

2. Q2 FY ’08 non-GAAP results exclude an estimated $3.7 million of share based compensation expense. 2008 full fiscal year non-GAAP results exclude an estimated $15.5 million of share based compensation expense.

3. As announced on July 31, 2007, VistaPrint no longer provides quarterly gross margin guidance.

FY’08 Q2 ending 12/31/07

$360 - $380 mm

41% - 48%

63% - 67%

$0.78 - $0.86

$1.10 - $1.18

15% - 20%

FY ‘08 ending 6/30/08

1

104

7%11% 11%

11%5%

1%

7%

3%1%

2%

2%2%

3%

2%

3%

12%

0%

10%

20%

30%

FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 Guidance

Other

Post-PressAutomation

New Products

Land

Facilities

Off-set & DigitalPresses

July 31st Guidance: Cap-Ex to Revenue

23%20%

16%

Total capital expenditures (million)$25$13 $19

Capi

tal e

xpen

ditu

res

as

a %

of

reve

nue

25%

$63 $55 to $75

15% to 20%

53

105

$14

44.6

10.212.2

13.6 14.315.6 15.8

18.620.2

27.8

25.327.3 27.1

34.3

34.934.9

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

Q2'04

Q3'04

Q4'04

Q1'05

Q2'05

Q3'05

Q4'05

Q1'06

Q2'06

Q3'06

Q4'06

Q1'07

Q2'07

Q3'07

Q4'07

Q1'08

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%Sessions (million)Average order value (AOV)Conversion Rate

$16 $17 $18$25$21

$29$27

$36

$42$45

$50

$64

$69$73

Revenues, Sessions, Conversion & AOV

Revenues ($ million)

$80

106

Appendix B

Including a Reconciliation of GAAP to Non-GAAP Financial Measures

54

107

About non-GAAP financial measures

To supplement VistaPrint’s consolidated financial statements presented in accordance with GAAP, VistaPrint uses the following measures defined as non-GAAP financial measures by the SEC: non-GAAP adjusted net income and non-GAAP adjusted earnings per share. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the slides captioned "Reconciliation GAAP to Non-GAAP Results” included at the end of this presentation.

VistaPrint’s management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenses that may not be indicative of our core business operating results. VistaPrint believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing VistaPrint’s performance and when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate management's internal comparisons to VistaPrint’s historical performance and our competitors' operating results. VistaPrint believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. Management uses these supplemental measures to evaluate performance period over period and to analyze the underlying trends in the Company's business and to establish operational goals and forecasts that are used in allocating resources.

VistaPrint expects to compute its non-GAAP financial measures using the same consistent method from quarter to quarter and year to year. The accompanying table has more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliation between these financial measures. The items excluded from the non-GAAP measurements for fiscal year 2007 and the first quarter of fiscal year 2008 are share based compensation expense and; for the fourth quarter and full fiscal year 2006 are share based compensation expense and tax accrual adjustments related to prior years’ tax settlement; and, for fiscal year 2005, a loss on a contract termination recorded in fiscal year 2005 is excluded.

(Continued on next slide)

108

About non-GAAP financial measurescontinued…

Share-based compensation expenseVistaPrint adopted SFAS 123(R) Share-Based Payments on July 1, 2005 and began expensing the fair value of share option grants issued to employees and directors. Prior to that date, the Company had accounted for share option grants under the provisions of APB No. 25, Accounting for Stock Issued to Employees, and therefore had not recorded any compensation related to such grants. Management has excluded share based compensation from the non-GAAP measurements for fiscal years 2006 and 2007 to facilitate comparison and analysis to historical performance and our competitors’ operating results.

Tax accrual adjustments related to prior yearsIn the quarter ending March 31, 2006, VistaPrint reversed excess income tax reserves related to the completion of an Internal Revenue Service audit of a prior fiscal year for its VistaPrint USA, Incorporated subsidiary. In the quarter ending June 30, 2006, VistaPrint reversed excess income tax reserves related to the expiration of a tax audit statute of limitations relating to a prior fiscal year. These reversals were accounted for as discrete events and resulted in income tax benefits during these periods. Management has excluded the impact of these tax accrual adjustments from the non-GAAP measurements for fiscal year 2006 to facilitate comparison and analysis of historical performance and to present a view of the current fiscal year’s effective tax rate that management believes is more consistent with both historical performance and expected future financial results.

Contract Termination LossIn the quarter ended September 30, 2004, the Company recorded a loss of $21 million related to the termination of a supply agreement with its North American print supplier. This loss was the result of a one-time payment made to this supplier that terminated all existing supply agreements in force at that time. Management has excluded the contract termination loss from the non-GAAP measurement to facilitate comparison and analysis to historical and future performance and our competitors’ operating results.

Although management believes that these non-GAAP financial measures are helpful to understanding the Company’s financial performance, to gain a complete picture of all effects on the Company's profit and loss from any and all events, management does (and investors should) rely upon the GAAP statement of operations.

55

109

Reconciliation: GAAP to Non-GAAP Results

Fiscal Year Ending June 2006

$9,280

-

$3,883

$5,397

Q4

$9,920

-

$3,041

$6,879

Q1

Fiscal Year 2008

$9,320

-

$1,935

$7,385

Q3

$10,027

-

$1,715

$8,312

Q2

Fiscal Year Ending June 2007

$7,281

-

$1,233

$6,048

Q1

$5,792

-

$326

$5,466

Q2

$7,193

$(252)

$2,181

$5,264

Q3

$7,246

$(686)

$2,329

$5,603

Q4

Non-GAAPNet-Income

Reversal ofTax Accruals

Share-based Compensation

GAAP Net Income

Net Income – Quarterly($ in thousands)

110

Diluted Earnings Per Share Quarterly

$0.16

$(0.01)

$0.05

$0.12

Q3 FY2006

$0.13

-

$0.00

$0.13

Q2 FY2006

$0.16

-

$0.02

$0.14

Q1 FY2007

$0.16

$(0.01)

$0.05

$0.12

Q4 FY2006

$0.20

-

$0.04

$0.16

Q3 FY2007

$0.22

-

$0.04

$0.18

Q2 FY2007

$0.20

-

$0.08

$0.12

Q4 FY2007

$0.21

-

$0.06

$0.15

Q1 FY2008

Non-GAAPNet-Income

Reversal ofTax Accruals

Share-based Compensation

GAAP Net Income

Reconciliation: GAAP to Non-GAAP Results

investor day 11 15 v3 - iis windows...

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