Shutterfly, Inc. (NASDAQ: SFLY) shares rose after the company reported better-than-expected earnings for its fourth quarter earnings and issued a strong FY18 guidance. The company also reported the purchase of Lifetouch for $825 million.
Said Shutterfly CEO Christopher North, “Shutterfly and Lifetouch, two undisputed leaders in their respective industries, are both built around the mission of helping customers share life’s joy through photos.
"The two companies are uniquely well suited for one another, with similar target customers as well as complementary manufacturing capabilities. Most exciting of all is the potential to bring together Lifetouch’s unique access to millions of families who value high-quality photographic portraits with Shutterfly’s cloud photo management, product breadth, and product creation capabilities.
"Together, the two companies will accelerate each other’s respective strategies, driving shareholder value through consumer growth and significant incremental profits and cash flow. We’re excited to welcome the Lifetouch team to the Shutterfly family."
Lifetouch is the clear leader in school photography. The company photographs more than 25 million children annually during the cherished fall picture day tradition, serving more than 10 million households, including more than one million new kindergarten households annually, across more than 50,000 schools. In Lifetouch’s fiscal year ended June 30, 2017, Lifetouch revenue was $963.9 million, and EBITDA was $111.3 million
Shutterfly, based out of Redwood City, California, expects the acquisition to result in approximately $935.0 million of additional Net revenues, and approximately $100 million of additional Adjusted EBITDA, in the 12-month period following closing of the acquisition.
Shutterfly shares climbed $14.38, or nearly 27%, Wednesday to $67.70.
