Vistaprint 2008 Annual Report Download - page 55

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The increase in our technology and development expenses of $17.7 million for fiscal 2008 as
compared to fiscal 2007 was primarily due to increased payroll and benefit costs of $10.3 million and
increased share-based compensation costs of $1.9 million associated with increased employee hiring
in our technology development and information technology support organizations. At June 30, 2008,
we employed 239 employees in these organizations compared to 175 employees at June 30, 2007.
The increase in headcount has resulted in an increase in allocated overhead of $1.3 million compared
to fiscal 2007. Allocated overhead consists primarily of facility-related expenses. In addition, to support
our continued revenue growth during this period, we continued to invest in our website infrastructure,
which resulted in increased depreciation and hosting service expenses of $2.6 million for fiscal 2008 as
compared to fiscal 2007.
The increase in our technology and development expenses of $11.5 million for fiscal 2007 as
compared to fiscal 2006 was primarily due to increased payroll and benefit costs of $7.8 million and
increased share-based compensation costs of $1.6 million associated with increased employee hiring
in our technology development and information technology support organizations. At June 30, 2007,
we employed 175 employees in these organizations compared to 111 employees at June 30, 2006. In
addition, to support our revenue growth during this period, we continued to invest in our website
infrastructure, which resulted in increased depreciation and hosting service expenses of $1.8 million for
fiscal 2007 as compared to fiscal 2006.
The increase in our marketing and selling expenses of $40.1 million for fiscal 2008 as compared
to fiscal 2007 was driven primarily by increases of $24.0 million in advertising costs related to new
customer acquisition and costs of promotions targeted at our existing customer base, increases in
payroll and benefits related costs of $7.7 million, and increased share-based compensation costs of
$0.5 million. During this period, we continued to expand our marketing organization and our design,
sales and customer support operations. At June 30, 2008, we employed 594 employees in these
organizations compared to 422 employees at June 30, 2007. The increase in headcount has resulted
in an increase in allocated overhead of $1.8 million compared to fiscal 2007. Allocated overhead
consists primarily of facility-related expenses. In addition, payment processing fees paid to third-parties
increased by $3.8 million during this period due to increased order volumes.
The increase in our marketing and selling expenses of $36.7 million for fiscal 2007 as compared
to fiscal 2006 was driven primarily by increases of $22.2 million in advertising costs related to new
customer acquisition and costs of promotions targeted at our existing customer base, increases in
payroll and benefits related costs of $5.9 million, and increased share-based compensation costs of
$3.0 million. The share-based compensation costs include a charge of $1.4 million related to the
modification of the vesting of options that was incurred related to a departing employee. During this
period, we continued to expand our marketing organization and our design, sales and service
operations. At June 30, 2007, we employed 422 employees in these organizations compared to 343
employees at June 30, 2006. In addition, payment processing fees paid to third-parties increased by
$2.2 million during this period due to increased order volumes.
The increase in our general and administrative expenses of $8.9 million for fiscal 2008 as
compared to fiscal 2007 was primarily due to increased payroll and benefit costs of $5.8 million and
increased share-based compensation costs of $3.2 million resulting from the continued growth of our
finance and human resource organizations, partially offset by decreases in third party professional fees
of $1.0 million. The third party professional fees include accounting, legal, recruiting, insurance and
organizational consulting service fees. At June 30, 2008, we employed 132 employees in these
organizations compared to 91 employees at June 30, 2007.
Form 10-K
51