Locafy Limited (Nasdaq: LCFY, LCFYW)
(“Locafy” or the “Company”), a globally recognized
software-as-a-service technology company specializing in
”entity-based” search engine optimization (SEO), today reported
financial results for the 2025 fiscal first quarter ended September
30, 2024. All financial results are reported in Australian Dollars
(AUD).
Operational HighlightsAchieved several key
technology and product milestones that lay the groundwork for
revenue growth in fiscal 2025, including:
- Successfully integrated Article
publishing solution into the Locafy platform. Previously, the
Article Accelerator technology was applied to third-party websites
that published their articles, which Locafy then “boosted.”
However, this approach was no longer viable due to Google’s recent
enforcement of penalties for site abuse. Now, Locafy can create,
publish, and boost articles within its ecosystem to achieve
national search prominence using proprietary technology and
expertise.
- Identified a market opportunity to
create locally focused business articles utilizing business listing
content from its directories and publishing partners connected via
its application program interface (API). The production of a
prototype solution was successfully completed, leveraging
generative artificial intelligence (AI) to automate article
creation and publishing on Locafy’s assets. Initial test articles
achieved Page 1 rankings for target keywords within 30 days.
- Revitalized scoop.com.au, an online directory specializing in
the travel, entertainment, and lifestyle sectors, which was
acquired earlier in 2024. With a strong Moz Domain Authority of 36,
over 48,000 backlinks (including approximately 5,000 from Wikipedia
and prior rankings for more than 170,000 organic keywords),
scoop.com.au presented an important asset. Leveraging this quality
and Locafy’s technology, more than 600,000 pages with contextually
relevant content were indexed in under 30 days. Locafy intends to
apply insights from this process to its other niche content and
directory publishing assets.
Management Commentary“Our operational progress
during the quarter has established a strong foundation for the
remainder of the fiscal year,” said Locafy CEO Gavin
Burnett. “We believe that we have officially transitioned
to a global publishing business powered by proprietary SEO
technology that drives online prominence for our customers' content
in organic search results across local and national markets.
“At the local level, we’re leveraging our quality directory
assets and publishing partnerships to create and deploy local SEO
products in a highly automated way. Our extensive network of
publishing partners provides quality business listing content that
we can now convert into valuable local SEO products, including
landing pages and articles, with an automated approach.
“After extensive testing, our local landing page solutions have
shown promising results. The next step is to generate these landing
pages using our partners' business listings as source content.
“Further, we’ve developed a prototype solution using generative
AI to produce high-quality, locally focused business articles. This
prototype utilizes the same individual business listings used for
landing pages. In testing, these articles ranked on Page 1 for
valuable keyword and location combinations within 30 days—a result
we’re thrilled with.
“In short, our goal is to empower any partner that publishes
business listings via our API to generate both landing pages and
article products automatically. We believe this will create a new
revenue stream for them and drive recurring revenue for us.
“On the enterprise level, we’re excited to enter the publishing
arena with niche content sites where we can use our Article
Accelerator technology to achieve national prominence in search
results for competitive, high-value keywords on behalf of our
clients. Our strategy will focus on high-value business categories
to maximize our return on investment.
“Looking ahead, we expect the full impact of our technology and
automation to drive accelerated growth in the coming quarters,
enabling us to expand our market reach and strengthen our recurring
revenue streams.”
2025 Fiscal First Quarter Financial
ResultsResults compare the 2025 fiscal first quarter end
(September 30, 2024) to the 2024 fiscal first quarter end
(September 30, 2023) unless otherwise indicated. All financial
results are reported in Australian Dollars (AUD).
- Total operating revenue decreased 27.8% to
$785,000 from $1.1 million in the comparable year-ago period.
- Subscription
revenue decreased 25.6% to $731,000 from $981,000 in the
comparable year-ago period. Compared to the 2024 fiscal fourth
quarter, subscription revenue remained steady.
- Advertising revenue
decreased 60.3% to $39,000 from $97,000 in the comparable year-ago
period. Compared to the 2024 fiscal fourth quarter, advertising
revenue remained steady.
- Services revenue
increased 80.3% to $16,000, up from $9,000 in the comparable period
last year. However, compared to the fourth quarter of fiscal 2024,
services revenue decreased by 96.3%, reflecting the completion of
significant services projects during that period. Locafy
anticipates that services revenue for the first quarter of fiscal
2025 reflects its near-term outlook, as the Company shifts
resources toward developing and monetizing its own online
publications rather than those owned by third parties.
- Other
income was $662,000 from $0 in the comparable
year-ago period. The variance is attributed to the Company’s recent
assessment (in conjunction with guidance received from professional
consultants) of the extent and likelihood of its ability to claim a
Research & Development tax incentive in Australia, as was
possible in prior years. The amount recognized in the 2025 fiscal
first quarter is based on an estimate of the claimable value from
expenditure incurred during the 2024 fiscal year and an estimate of
the claimable value of expenditure incurred during the 2025 fiscal
first quarter itself.
- Operating
expenses decreased 22.5% to $1.5 million from $1.9
million in the comparable year-ago period. This is primarily due to
a 51.0% decrease in employment-related expenses to $454,000 from
$927,000, a 35.5% decrease in consultancy expenses to $152,000 from
$235,000, and offset by a 25.7% increase in amortization expenses
to $452,000 from $360,000.
- Net loss was $55,000, or $0.04 per diluted
share, compared to a net loss of $808,000, or $0.63 per diluted
share, in the comparable year-ago period.
Key Performance Indicators (KPIs)As part of its
updated go-to-market strategy, Locafy has shifted its focus from
traditional KPIs, which are no longer seen as adequate indicators
of long-term success. The Company now prioritizes Monthly Recurring
Revenue (MRR) as the key measure of performance across its
platform. Unless otherwise stated, KPI data is as of the fiscal
first quarter of 2025 (ended June 30, 2025).
- Monthly recurring revenue (MRR) for the 2025
fiscal first quarter was $256,000, a 28.7% decrease from the
comparable year-ago period and a slight increase compared to the
2024 fiscal first quarter.
For more information, please see Locafy’s investor relations
website at investors.locafy.com.
About LocafyFounded in 2009, Locafy's (Nasdaq:
LCFY, LCFYW) mission is to revolutionize the US$700 billion SEO
sector. We help businesses and brands increase search engine
relevance and prominence in a specific proximity using a fast,
easy, and automated approach. For more information, please visit
www.locafy.com.
About Key Performance IndicatorsLocafy defines
MRR as the value of all recurring subscription contracts with
active entitlements as at the end of each month. MRR across a
period is the average of each month’s MRR within that period.
Locafy’s recent platform upgrade caused a significant change to
the calculation of average page metrics, and Locafy management no
longer views total active reseller count and total end user count
as relevant indicators of the performance of Locafy’s technology.
The Company may introduce additional KPIs in future quarters if
deemed relevant long-term indicators of performance.
Forward-Looking StatementsThis press release
contains “forward-looking statements” that are subject to
substantial risks and uncertainties. All statements, other than
statements of historical fact, contained in this press release are
forward-looking statements. Forward-looking statements contained in
this press release may be identified by the use of words such as
“subject to”, “believe,” “anticipate,” “plan,” “expect,” “intend,”
“estimate,” “project,” “may,” “will,” “should,” “would,” “could,”
“can,” the negatives thereof, variations thereon and similar
expressions, or by discussions of strategy, although not all
forward-looking statements contain these words. Although the
Company believes that the expectations reflected in such
forward-looking statements are reasonable, they do involve
assumptions, risks, and uncertainties, and these expectations may
prove to be incorrect. You should not place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. The Company’s actual results could differ materially
from those anticipated in these forward-looking statements as a
result of a variety of factors and risk factors, including those
discussed in the Company’s filings with the Securities and Exchange
Commission (the “SEC”), including the Company’s Annual Report on
Form 20-F filed with the SEC on November 12, 2024, and available on
its website (http://www.sec.gov). All forward-looking statements
attributable to the Company or persons acting on its behalf are
expressly qualified in their entirety by these factors. Other than
as required under the securities laws, the Company does not assume
a duty to update these forward-looking statements.
Investor Relations ContactMatt Glover or Matt
SzotGateway Investor Relations(949)
574-3860LCFY@gateway-grp.com
|
|
-Financial Tables to Follow- |
|
|
|
Locafy Limited Consolidated Statement of
Profit or Loss and Other Comprehensive
Income(Unaudited) |
|
|
|
|
|
|
|
|
3 months to30 Sep 2024AUD
$ |
|
|
3 months to30 Sep 2024AUD
$ |
|
Revenue |
|
|
|
|
785,166 |
|
|
785,166 |
|
Other
income |
|
|
|
|
661,516 |
|
|
661,516 |
|
Technology expense |
|
|
|
|
(312,484 |
) |
|
(312,484 |
) |
Employee benefits expense |
|
|
|
|
(454,422 |
) |
|
(454,422 |
) |
Occupancy expense |
|
|
|
|
(27,761 |
) |
|
(27,761 |
) |
Advertising expense |
|
|
|
|
(21,021 |
) |
|
(21,021 |
) |
Consultancy expense |
|
|
|
|
(151,547 |
) |
|
(151,547 |
) |
Depreciation and amortization expense |
|
|
|
|
(452,072 |
) |
|
(452,072 |
) |
Other
expenses |
|
|
|
|
(67,114 |
) |
|
(67,114 |
) |
Operating loss |
|
|
|
|
(39,739 |
) |
|
(39,739 |
) |
Financial cost |
|
|
|
|
(15,713 |
) |
|
(15,713 |
) |
Loss before income tax |
|
|
|
|
(55,452 |
) |
|
(55,452 |
) |
Income tax expense |
|
|
|
|
- |
|
|
- |
|
Loss for the period after tax |
|
|
|
|
(55,452 |
) |
|
(55,452 |
) |
|
|
|
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
Items that will be reclassified subsequently to profit and
loss |
|
|
|
|
|
|
|
|
|
Exchange differences on translating foreign operations |
|
|
|
|
22,320 |
|
|
22,320 |
|
Total comprehensive loss for the period |
|
|
|
|
(33,132 |
) |
|
(33,132 |
) |
|
|
|
|
|
|
|
|
|
|
Earnings per share |
|
|
|
|
|
|
|
|
|
Basic
loss per share |
|
|
|
|
(0.04 |
) |
|
(0.04 |
) |
Diluted loss per share |
|
|
|
|
(0.04 |
) |
|
(0.04 |
) |
|
|
Locafy Limited Consolidated Statement of
Financial Position |
|
|
|
|
As at30 Sep 2024AUD
$(unaudited) |
|
|
As at30 Jun 2024AUD
$(audited) |
|
|
As at30 Jun 2023AUD
$(audited) |
|
Assets |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash
and cash equivalents |
409,379 |
|
|
275,875 |
|
|
3,174,700 |
|
Trade
and other receivables |
1,493,217 |
|
|
904,564 |
|
|
1,288,513 |
|
Other
assets |
271,900 |
|
|
294,355 |
|
|
356,782 |
|
Total current assets |
2,174,496 |
|
|
1,474,794 |
|
|
4,819,995 |
|
Non-current assets |
|
|
|
|
|
|
|
|
Property, plant and equipment |
171,759 |
|
|
196,929 |
|
|
380,018 |
|
Right
of use assets |
251,760 |
|
|
280,810 |
|
|
314,596 |
|
Intangible assets |
4,162,493 |
|
|
4.204,966 |
|
|
3,720,272 |
|
Total non-current assets |
4,586,012 |
|
|
4,682,705 |
|
|
4,414,886 |
|
Total assets |
6,760,508 |
|
|
6,157,499 |
|
|
9,234,881 |
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Trade
and other payables |
1,229,033 |
|
|
1,252,503 |
|
|
2,507,573 |
|
Borrowings |
271,600 |
|
|
271,600 |
|
|
301,600 |
|
Provisions |
187,130 |
|
|
211,300 |
|
|
214,465 |
|
Accrued expenses |
380,283 |
|
|
496,749 |
|
|
512,611 |
|
Lease
liabilities |
131,162 |
|
|
128,669 |
|
|
85,165 |
|
Contract and other liabilities |
153,192 |
|
|
147,640 |
|
|
152,211 |
|
Total current liabilities |
2,352,400 |
|
|
2,508,461 |
|
|
3,773,625 |
|
Non-current liabilities |
|
|
|
|
|
|
|
|
Lease
liabilities |
170,183 |
|
|
203,909 |
|
|
332,578 |
|
Provisions |
132,234 |
|
|
133,399 |
|
|
138,721 |
|
Total non-current liabilities |
302,417 |
|
|
337,308 |
|
|
471,299 |
|
Total liabilities |
2,654,817 |
|
|
2,845,769 |
|
|
4,244,924 |
|
Net assets |
4,105,691 |
|
|
3,311,730 |
|
|
4,989,957 |
|
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
|
Issued capital |
49,366,644 |
|
|
48,588,888 |
|
|
47,930,486 |
|
Reserves |
2,997,336 |
|
|
2,925,679 |
|
|
2,404,933 |
|
Accumulated losses |
(48,258,288 |
) |
|
(48,202,837 |
) |
|
(45,345,462 |
) |
Total equity |
4,105,692 |
|
|
3,311,730 |
|
|
4,989,957 |
|
|
|
Locafy Limited Consolidated Statement of
Cash Flows |
|
|
|
|
|
3 months to30 Sep 2024AUD
$(unaudited) |
|
|
FY2024AUD
$(audited) |
|
|
FY2023AUD
$(audited) |
|
Cash flows from operating activities |
|
|
|
|
|
|
|
|
|
Receipts from customers (inclusive of GST) |
|
640,786 |
|
|
3,098,793 |
|
|
4,463,725 |
|
Payments to suppliers and employees (inclusive of GST) |
|
(916,112 |
) |
|
(4,658,997 |
) |
|
(7,005,510 |
) |
R&D Tax Incentive and government grants |
|
- |
|
|
561,501 |
|
|
386,181 |
|
Financial cost |
|
(15,713 |
) |
|
(114,199 |
) |
|
(105,367 |
) |
Net cash used by operating activities |
|
(291,039 |
) |
|
(1,112,902 |
) |
|
(2,260,971 |
) |
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
|
Purchase of intellectual property |
|
(355,381 |
) |
|
(2,166,587 |
) |
|
(1,617,446 |
) |
Purchase of property, plant and equipment |
|
- |
|
|
- |
|
|
(2,170 |
) |
Maturity of term deposit |
|
- |
|
|
40,000 |
|
|
- |
|
Net cash used by investing activities |
|
(355,381 |
) |
|
(2,126,587 |
) |
|
(1,619,616 |
) |
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
|
Proceeds from issue of shares |
|
821,814 |
|
|
769,936 |
|
|
3,295,822 |
|
Payment for share issue costs |
|
(29,492 |
) |
|
(313,643 |
) |
|
(403,373 |
) |
Repayment of borrowings |
|
- |
|
|
(30,000 |
) |
|
(6,500 |
) |
Leasing liabilities |
|
(31,233 |
) |
|
(85,165 |
) |
|
(32,673 |
) |
Net cash from financing activities |
|
761,089 |
|
|
341,128 |
|
|
2,853,276 |
|
|
|
|
|
|
|
|
|
|
|
Net
increase/(decrease) in cash and cash equivalents |
|
114,669 |
|
|
(2,898,361 |
) |
|
(1,027,311 |
) |
Net
foreign exchange difference |
|
18,835 |
|
|
(464 |
) |
|
118,276 |
|
Cash
and cash equivalents at the beginning of the period |
|
275,875 |
|
|
3,174,700 |
|
|
4,083,735 |
|
Cash and cash equivalents at the end of the
period |
|
409,379 |
|
|
275,875 |
|
|
3,174,700 |
|
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