Announcement PDF ASX Announcement Press Release 6th July 2021 Xref Limited ASX XF1 Q a e ● ● ● ● ● U da e X ef Achie e P i h Sa e G hi Q Sa e 6 4 million ○ Xref Credits 5 1 million 104 growth ○ Rapid ID Gross Sales 1 3 million 6 growth Ca h E e e 3 4 million Ca h Recei 5 million Re e e 3 million P Bef e Ta 0 million Xref Limited ASX XF the human resources technology company today reports a record fourth quarter of trading Unaudited results show record sales of 6 3 million and strong cash receipts at 5 3 million Credit usage also reached 3 3 million for the quarter New clients introduced during this time included RACV NIB Group Prospa and General Pants Group in Australia Ministry of Health in New Zealand Brighton Hove Albion FC and Ferrovial Construction in the United Kingdom and Eurofins Scientific and Mott Macdonald in the USA Further information about these new clients follows as an appendix Ca h F B ea E e Operating cash outflows for the June quarter were 3 43 million while cash receipts reached a record 5 3 million Cash receipts from sales were up by 14 on the previous corresponding quarter Xref was able to achieve an operating cash surplus of 2 5 million for the quarter After allowing for development costs and interest the full quarter cash surplus was 1 5 million Cash at bank on 30 June 2021 was 1 million compared to 2 4 million in June 2020 including receipt of net proceeds from the new debt facility of 4 million in July 2020 Xref achieved an 1 operating cash surplus of 1 1 million for the year and a maiden full year cash flow surplus after including all development costs funding acquisition costs and interest costs of 0 25 million Excludes R D grants and COVID 1 subsidies S g Sa e G h COVID 1 has accelerated the global demand for remote working and as a result employers desire to improve governance is increasing Accordingly organisations are seeking better ways to perform candidate verification Xref can now acquire clients via its self serve platform its in house enterprise sales teams or via its 30 channel partners As a result Xref s reliance on outbound direct sales activities is fast being replaced by inbound marketing led demand During the quarter Xref witnessed a rise in inbound leads from in the most part channel partner integrations an improved global digital strategy and the network effect generated through the numerous sectors and global regions Xref is used in Group sales reached 6 3 million during the quarter up 140 on the previous corresponding quarter Q4 FY20 and 61 when compared to Q3 FY21 Newly acquired clients accounted for 21 of Xref sales while 11 6 came from Xref s international offices in Europe and North America and 20 5 from RapidID 2 Sales from North America grew 150 to 0 6m when compared to the previous corresponding quarter Q4 FY20 and 115 when compared to Q3 FY21 Sales gross revenue by RapidID grew by 6 when compared to the previous corresponding quarter Q4 FY20 and 3 when compared to Q3 FY21 Clients who joined Xref prior to FY1 accounted for 2 2 of sales during Q4 FY21 despite significant sales growth since then demonstrating Xref s ability to retain and grow clients over time Clients that joined within FY21 represented 25 of total sales during the quarter demonstrating Xref s ability to also acquire new high value clients G Re e e C edi U age Xref credits used during the quarter totalled 3 21 million and together with RapidIDs net revenue of 0 52 million contributed to a record quarterly revenue of 3 3 million Xref credit usage grew and RapidIDs net revenue grew 4 2 on the previous corresponding quarter Q4 FY20 Xref credits are recognised as revenue when used RapidID Net Revenue is gross revenue less the cost of 3rd party checks P d c I e e Although Xrefs markets continue to be adversely impacted by the effects of COVID 1 Xref is preparing for the growth that is anticipated to come from millions of returning workers globally Xref is working with some of its largest global clients to expand the current platform and support their future requirements The enhanced platform will dramatically increase the global addressable market 3 through the provision of additional services allow for an entirely digital new client acquisition process and add a subscription based ARR to the current credit based model During the quarter Xref capitalised a proportion of internal and external development costs related to these platform features P Bef e Ta The profit before tax for the quarter was 0 m Unaudited management accounts A i e f N E ec i e Di ec Li a Wi On 2nd June 2021 Xref announced the appointment of Lija Wilson as a Non Executive Director of the Company effective 2nd June 2021 Mrs Wilsons appointment is to be confirmed by shareholders at the 2021 Annual General Meeting AGM in November 2021 B i e U da e I e Ca hJ Chief Executive Officer Lee Martin Seymour will host an investor call to discuss Xref s Q4 FY21 results on Tuesday 6th July 2021 at 11 00am AEST The number for Australian investors is 1 00 0 3 431 and for international investors is 61 2 04 3 3 The conference ID is 6 2 015 For a full list of toll free international dial in numbers for all regions please click HERE Ma age e C e E ec i e di ec CEO Lee Ma i Se aid The extreme unpredictability of market conditions in FY21 meant it was one of our most challenging financial years to date However we are proud of the many strategic decisions we made which resulted in us emerging from the pressures of the pandemic in our strongest position to date Over recent years we have focussed on building Xref s online brand presence third party ratings and self serve products This digital first approach has been vital to our growth in 2021 as global employers search online for better ways to verify and measure talent Our results not only reflect the critical nature and demand for the Xref platform but demonstrate the brilliance and professionalism of the Xref team The year ahead will bring new products sustained profitability and continued growth We are all very excited to discover what FY22 will hold Chai a B ad R e aid Having committed to achieving both growth and profitability during FY21 it is exciting to share these record results Xref s ability to retain clients while acquiring new customers at all levels and via many channels is exemplary Now the business is at an inflection point positioned well for scale and has the resources to take full advantage of the opportunity ahead A e di C i e e a a e As required by listing rule 4 C 3 the amount of 140 000 shown at item 6 within this quarters 4C is payment of directors fees and salaries to executive directors plus statutory entitlements For Further information X ef Li i ed Lee Martin Seymour Founder CEO Director E lee xref com M 61 43 5 6624 Media I e E i ie The Capital Network Julia Maguire E julia thecapitalnetwork com au M 61 2 36 Authorised by the Board Xref Limited ASX XF1 4 Ab X ef Xref is a reference checking and identity verification platform that empowers organisations worldwide to make great people decisions Xref s fully automated online reference checking platform allows employers to request one or multiple references in minutes and receive fast honest feedback within 24 hours Xref also enables employers to know who a candidate really is with RapidID Xref s biometric identity verification solution Xref is the reference checking platform of choice globally The company understands the talent and human resources markets and is currently working with some of the largest organisations in the world to develop new products that will provide unique employment insights In the future Xref plans to extend its platform across the full hire to retire journey dramatically increasing its addressable market and allowing organisations to reap the benefits of Xref across their businesses To learn more please visit Website xref com Investor Centre and Presentation xf1 com Twitter xf1 Email investors xf1 com Xref Limited Suite 13 13 Hickson Road Dawes Point Sydney NSW 2000 Australia 5 A e di Ne c ie A a ia Ne Zea a d RACV has more than 3000 employees and over 2 million members and operates in the areas of motoring home leisure travel and retail They provide products and services such as roadside assistance insurance leisure and travel services and home security nib Group founded in 1 52 nib Group provides health and medical insurance to over 1 4 million Australian and New Zealand residents They also provide health insurance to almost 200 000 international students and workers in Australia and are Australias third largest travel insurer and global distributor of travel insurance nib has 1500 employees Prospa founded in 2012 with the vision of changing the way small business owners experience finance and today has over 200 employees and a network of over 10 000 distribution partners across Australia and New Zealand General Pants Group is an Australian fashion retailer operating 54 stores across Australia and over 600 employees The Ministry of Health in New Zealand Māori Manatū Hauora is the public service department of New Zealand responsible for healthcare in New Zealand It came into existence in its current form in 1 3 and currently has over 1100 employees U i ed Ki gd Brighton Hove Albion FC is an English professional football club based in the city of Brighton and Hove They compete in the Premier League the top tier of the English football league system Ferrovial Construction is a Spanish multinational company involved in the design construction financing operation DBFO and maintenance of transport infrastructure and urban services Ferrovial employs over 100 000 people across 50 countries and has revenues of 12 billion N h A e ica Eurofins Scientific is an international group of laboratories headquartered in Luxembourg providing testing and support services to the pharmaceutical food environmental agriscience and consumer products industries 1 2 and to governments Eurofins Group has an international network of more than 00 laboratories across 50 countries Eurofins employs over 50 000 people across 50 countries and has revenues of 6 billion The Mott Macdonald Group USA is a construction consultancy headquartered in the United Kingdom It employs 16 000 staff in 150 countries Mott MacDonald is one of the largest employee owned companies in the world 6 A 4C Q L R 4.7B N Xref Limited ABN Q 34 122 404 666 ( ) 30 J ne 2021 C C Y (12 ) $A 000 $A 000 1. C 1.1 Receipts from c stomers 1.2 Pa ments for 5,929 14,787 (a) research and de elopment (12) (41) (b) prod ct man fact ring and operating costs (843) (2,153) (c) ad ertising and marketing (114) (490) (d) leased assets (66) (434) (1,862) (8,326) (226) (853) (e) staff costs (f) administration and corporate costs 1.3 Di idends recei ed (see note 3) - - 1.4 Interest recei ed 1 10 1.5 Interest and other costs of finance paid - - 1.6 Income ta es paid - - 1.7 Go ernment grants and ta incenti es 11 656 1.8 Other (pro ide details if material) - Upfront ann al s bscriptions paid - GST for the period - Net foreign e change (20) (293) (1) (409) (857) 23 2,504 1,913 1.9 N /( ) Xref Limited - J ne Q arter 2021 Appendi 4C Page 1 A Q 2. C 2.1 Pa ments to acq ire: L 4C 4.7B (a) entities - - (b) b sinesses - - (2) (33) (d) in estments - - (e) intellect al propert - - (454) (1048) (a) entities - - (b) b sinesses - - (c) propert , plant and eq ipment - - (d) in estments - - (e) intellect al propert - - (f) - - (c) propert , plant and eq ipment (f) 2.2 R other non-c rrent assets - Website Proceeds from disposal of: other non-c rrent assets 2.3 Cash flo s from loans to other entities - - 2.4 Di idends recei ed (see note 3) - - 2.5 Other (pro ide details if material) 23 26 2.6 N (433) (1,055) 3. C 3.1 Proceeds from iss es of eq it sec rities (e cl ding con ertible debt sec rities) - - /( ) 3.2 Proceeds from iss e of con ertible debt sec rities - - 3.3 Proceeds from e ercise of options - - 3.4 Transaction costs related to iss es of eq it sec rities or con ertible debt sec rities - - 3.5 Proceeds from borro ings - 5,000 3.6 Repa ment of borro ings - - 3.7 Transaction costs related to loans and borro ings - (235) 3.8 Di idends paid - - 3.9 Other (pro ide details if material) (125) (375) 3.10 N (125) 4,390 /( ) Xref Limited - J ne Q arter 2021 Appendi 4C Page 2 A Q L 4. N /( 4.1 Cash and cash eq i alents at beginning of period R 4C 4.7B ) 6,239 2,937 4.2 Net cash from / ( sed in) operating acti ities (item 1.9 abo e) 2,504 1,913 4.3 Net cash from / ( sed in) in esting acti ities (item 2.6 abo e) (433) (1,055) 4.4 Net cash from / ( sed in) financing acti ities (item 3.10 abo e) (125) 4,390 4.5 Effect of mo ement in e change rates on cash held - - 4.6 C 8,185 8,185 5. R C P $A 000 $A 000 at the end of the q arter (as sho n in the consolidated statement of cash flo s) to the related items in the acco nts 5.1 Bank balances 8,151 6,205 5.2 Call deposits 34 34 5.3 Bank o erdrafts - - 5.4 Other (pro ide details) - - 5.5 C 8,185 6,239 ( 6. 4.6 ) P C $A'000 6.1 Aggregate amo nt of pa ments to related parties and their associates incl ded in item 1 140 6.2 Aggregate amo nt of pa ments to related parties and their associates incl ded in item 2 - 7. F T N e: he e a a ge e Add facili i cl de all f a ailable he e i . e a ece a f a ce f fi a ce a ailable 7.1 Loan facilities 7.2 A f fi a ci g de a di g f he he e i . $A 000 $A 000 5,000 5,000 Credit standb arrangements - - 7.3 Other (please specif ) - - 7.4 T 5,000 5,000 7.5 U Xref Limited - J ne Q arter 2021 Appendi 4C - Page 3 A Q 7.6 L 4C 4.7B R Incl de in the bo belo a description of each facilit abo e, incl ding the lender, interest rate, mat rit date and hether it is sec red or nsec red. If an additional financing facilities ha e been entered into or are proposed to be entered into after q arter end, incl de a note pro iding details of those facilities as ell. $5m f ll dra n facilit ith PURE Asset Management. 4- ear term. 9.95% interest rate, interest to be paid e er 3 months. No principal amortisation, repa able at mat rit . Sec red against assets of Xref Limited & s bsidiaries. ASX release 31 J l 2020 8. E $A 000 8.1 Net cash from / ( sed in) operating acti ities (Item 1.9) 2,504 8.2 Cash and cash eq i alents at q arter end (Item 4.6) 8,185 8.3 Un sed finance facilities a ailable at q arter end (Item 7.5) 8.4 Total a ailable f nding (Item 8.2 + Item 8.3) 8.5 E I (I 8,185 8.4 N/A 8.1) N e: if he e i ha e ed fig e f he e i a ed a e 8.6 - ii e e e a i g ca h fl i i e 1.9, a e ie f f di g a ailable be i cl ded i i e 8.5. 8.5 a N/A . O he i e, a If Item 8.5 is less than 2 q arters, please pro ide ans ers to the follo ing q estions: 8.6.1 Does the entit e pect that it ill contin e to ha e the c rrent le el of net operating cash flo s for the time being and, if not, h not? Ans er: N A 8.6.2 Has the entit taken an steps, or does it propose to take an steps, to raise f rther cash to f nd its operations and, if so, hat are those steps and ho likel does it belie e that the ill be s ccessf l? Ans er: N A 8.6.3 licable licable Does the entit e pect to be able to contin e its operations and to meet its b siness objecti es and, if so, on hat basis? Ans er: N A licable N e: he e i e 8.5 i le Xref Limited - J ne Q arter 2021 Appendi 4C ha 2 a e , all f Page 4 e i 8.6.1, 8.6.2 a d 8.6.3 ab e be a e ed. A Q L R C 1 This statement has been prepared in accordance ith acco nting standards and policies hich compl ith Listing R le 19.11A. 2 This statement gi es a tr e and fair ie of the matters disclosed. Date: 6 J l 2021 A thorised b : The B a d f Di ec Xref Limited - J ne Q arter 2021 Appendi 4C f X ef Li i ed Page 5 4C 4.7B