Vistaprint results hit as smaller discounts hurt client additions

Tue Apr 29, 2014 7:22pm EDT

(Reuters) - Online designing and printing services company Vistaprint NV (VPRT.O) reported a much lower-than-expected quarterly revenue, hurt by fewer customer additions as it shifts from offering deep discounts.

Vistaprint's shares fell as much as 21 percent in extended trading.

The company, which offers designs for business cards, letterheads, banners and blogs, said in a statement that it had moved away from the practice of offering deep discounts and promotions. (link.reuters.com/mat88v)

Vistaprint said it was now also targeting micro-business customers, who seek better products and services and are less price sensitive than its traditional customers.

The company said it expected to take a charge of up to $14 million in the fourth quarter ending June 30 related to the sale of its stake in its Chinese joint venture, Namex Ltd.

Vistaprint forecast adjusted earnings of $2.70-$2.85 per share and revenue of $1.25 billion to $1.27 billion for the year ending June 30.

The company estimated capital expenditure of $70 million to $80 million for its fiscal year, including investments in new manufacturing capabilities.

Vistaprint's net income more than halved to $1.4 million, or 4 cents per share, in the third quarter ended March 31 from $5.9 million, or 17 cents per share, a year earlier.

Excluding items, the company earned 24 cents per share.

Revenue was virtually flat at $286.2 million, far short of the $310.7 million analysts on average had expected, according to Thomson Reuters I/B/E/S.

Vistaprint said revenue growth slowed in the United States, its biggest market.

The company's shares closed at $53.42 on the Nasdaq on Tuesday.

(Reporting by Sampad Patnaik in Bangalore; Editing by Savio D'Souza and Kirti Pandey)

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