Vistaprint 2009 Annual Report Download - page 28

volume of products we sell. Further, if we experience lower than expected sales during the second
quarter it would likely have a disproportionately large impact on our operating results and financial
condition for the full fiscal year. In the future, our seasonal sales patterns may become more
pronounced or may change to the extent we introduce additional products and services targeted to the
consumer marketplace, including products and services that may be unrelated to the second quarter
holiday period. If we are unable to accurately forecast and respond to seasonality in our business
caused by demand for our consumer-oriented products, our business and results of operations may be
materially harmed.
We are dependent upon our own facilities for the production of products sold to our customers
and any significant interruption in the operations of these facilities or any inability to increase
capacity at these facilities would have an adverse impact on our business.
We produce all of our products internally at our facilities in Windsor, Ontario, Canada and Venlo,
the Netherlands. We seek to ensure that we can satisfy all of our production demand from our facilities,
including at periods of peak demand, while maintaining the level of product quality and timeliness of
delivery that customers require. If we are unable to meet demand from our own facilities or to
successfully expand those facilities on a timely basis to meet customer demand, we would likely turn to
an alternative supplier in an effort to supplement our production capacity. However, an alternative
supplier may not be able to meet our production requirements on a timely basis or on commercially
acceptable terms, or at all. If we are unable to fulfill orders in a timely fashion at a high level of product
quality through our facilities and are unable to find a satisfactory supply replacement, our business and
results of operations would be substantially harmed.
Our quarterly financial results will often fluctuate which may lead to volatility in our share price.
Our future revenues and operating results will often vary significantly from quarter-to-quarter due
to a number of factors, many of which are outside of our control. Factors that could cause our quarterly
revenue and operating results to fluctuate include, among others:
‰seasonality-driven or other variations in the demand for our services and products;
‰our ability to attract visitors to our websites and convert those visitors into customers;
‰our ability to retain customers and encourage repeat purchases;
‰business and consumer preferences for our products and services;
‰shifts in product mix toward lower gross margin products;
‰investment decisions by management made in relation to our performance against targeted
earnings per share levels;
‰our ability to manage our production and fulfillment operations;
‰currency fluctuations, which affect not only our revenues but also our costs;
‰the costs to produce our products and to provide our services;
‰our pricing and marketing strategies and those of our competitors;
‰improvements to the quality, cost and convenience of desktop printing;
‰costs of expanding or enhancing our technology or websites;
‰compensation expense and charges related to our awarding of share-based compensation;
‰costs and charges resulting from litigation; and
‰a significant increase in credits, beyond our estimated allowances, for customers who are not
satisfied with our products.
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