Employee wellness has been at the forefront of employer’s minds since the pandemic pulled us out of the office and left us as tracksuit clad, makeup free recluses. At least in my case anyway.
Digital employee wellness company Limeade (ASX: LME) has seen organisation wide growth indicated by their increase in headcount and operating cash outflows following the acquisition of TINYpulse, an employee feedback software company. The 18% increase in staff costs and 56% increase in R&D represent investment in the Company’s tech platform and expansion with TINYpulse.
Despite cash receipts from customers taking a 32% dip to $16.1 million in comparison to the prior corresponding period, the Company is retaining their customers with cash and recurring subscription revenue remaining strong. Limeade’s top 20 customers on average have 19 months remaining on their contracts, an increase from 17 months at Q2 2021.
Q4 is expected to yield strong growth and further contract signings. The Company also expects to launch a mid-market wellbeing offering in Q4.
Limeade reported operating costs of $4.1 million. It is however worth noting that a large upfront enterprise subscription was paid in early October, increasing the operating outflows for the quarter ending 30 September, in preparation.
The Company maintains their financial guidance for FY21 of $50-53 million in revenue and an EBITDA loss of $5-8 million, whilst maintaining a cash balance of $15.1 million and is debt free. They hold an undrawn debt facility of $15 million, representing headroom to pursue growth opportunities as they arise.
One of those growth opportunities came in the form of a partnership with Microsoft Viva, an employee experience platform that can be accessed through Microsoft Teams. Limeade aims to ‘infuse care’ into digital platforms to foster better connections between teams and provide resources.
CEO of Limeade, Henry Albrecht said: “During the quarter we focussed on serving our core enterprise well-being customers, integrating the TINYpulse acquisition and readying for the launch of an immersive well-being entry into the mid-market. Whether a company has 2000 or 20,000 employees, they seek to listen better and do more for their people to maximise business performance. We are very pleased at the acceleration of our late-stage enterprise sales pipeline to finalist, and verbal stages as well, providing Limeade with a solid platform for growth in 2022.”
Samantha Freidin is a business journalist at Emerald Financial whilst also completing a Masters of Marketing and Digital Communications at Monash University.
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