Top 40 distributor Cimpress (asi/162149), parent company of Vistaprint and National Pen, reported late Wednesday that its fiscal third quarter sales improved 4% year-over-year to $661.8 million.

The Netherlands-based firm executed the increase despite a 2.1% drop in revenue, to $349.9 million, in its most important business unit, Vistaprint, and a 2.2% decline in sales, to $79.7 million, at National Pen, a former Top 40 promotional products distributor that Cimpress acquired several years ago. Vistaprint is a web-based global provider of printed marketing materials and promotional products.

Robert S. Keane, Cimpress

A 2.7% sales increase in Cimpress’ “upload and print” division, to $188.1 million, and a 165% increase in revenue, to $50.1 million, in its “all other businesses” category propelled the overall sales ascent.

“We delivered financial results in line with the lowered expectations we described three months ago, albeit with mixed performance by reporting segment,” said Cimpress CEO Robert S. Keane in a letter to investors.

Characterizing National Pen’s performance as “disappointing again,” Keane said the sales slump resulted from factors that include reduced mail and telesales prospecting and operational delays related to direct marketing mailings. A $1.7 million loss for the quarter in the National Pen division resulted mainly from the reduced revenue, and from increased investment in ecommerce technology and marketing teams.

Vistaprint’s revenue rollback was primarily a consequence of reduced spending on “poor-ROI” producing advertising, Cimpress said. “We continue to expect flat-to-negative growth for Vistaprint for the foreseeable future because we will accept declining revenue growth in favor of improved returns on our advertising investment,” the company stated. The $16.5 million reduction in ad spend is primarily what propelled Vistaprint’s approximately $12 million increase in Q3 profit, which came in at $69.7 million.

For the quarter ended March 31, Cimpress’ total company net income was $6.24 million, up from a loss of $2.26 million the same quarter the prior year. Meanwhile, the large-scale reduction of advertising spend helped drive a 118% increase in overall adjusted net operating profit, which tallied $55.2 million. Earnings per share improved dramatically, rising from a per-share loss of $0.7 in the prior year’s Q3 to EPS of $0.21 in this year’s third quarter. Adjusted EBITDA for third quarter was $88.9 million, up 29% from Q3 FY2018.

For fiscal 2019’s first nine months, Cimpress’ total sales accelerated nearly 6% to approximately $2.07 billion. Net income was up almost $10 million to $60.9 million. Basic EPS improved from $1.65 to $1.98, while adjusted EPS jumped from $1.58 to $1.92. Adjusted net operating profit galloped forwarded 36% to $175.6 million.

For the nine-month period, sales and profits increased at Vistaprint. Vistaprint posted profits of $200.76 million, up from $187.6 million, on revenue of $1.12 billion -- a 1.4% year-over-year improvement. The picture wasn’t as positive at National Pen. While nine-month sales rose 4.2% to $278.64 million, profits dropped 73% to $5.1 million.

Keane said that Cimpress is taking steps to ensure long-term success at Vistaprint, National Pen and all its business divisions. “We are proactively addressing the challenges,” he said.

With estimated 2017 North American promotional product revenue of $240 million, Cimpress ranked sixth of Counselor’s latest list of the largest distributors in the industry.