Xref (ASX:XF1) founder and CEO Lee-Martin Seymour said the company delivered positive EBITDA and continued its migration to a single SaaS platform during the most recent half, outlining progress on platform adoption, operational efficiency, and a planned push into a “metadata API” designed to bring reference information earlier into the hiring process.
Half-year financial highlights
Seymour reported half-year revenue of AUD 10.2 million, including AUD 4.2 million from the company’s “new platform,” which he said was up 58% year-on-year. EBITDA was positive at AUD 1.3 million, which Seymour described as evidence the business has “core profitability.” He also referenced an adjusted EBITDA result that removes the prior period’s R&D grant, saying the underlying EBITDA grew 900% versus the prior corresponding period.
Platform transition and recurring revenue mix
Xref has been transitioning away from a “credit-based transactional point solution” since 2020, and Seymour said the shift is now “complete” in practical terms because 54% of total ARR is on the new platform. He said new platform ARR rose 27% from AUD 7.2 million to AUD 9.2 million between July and December, and noted this is the first time the company has reported that most ARR is on the new platform.
Seymour said the company’s strategy in making the transition included moving to a low-friction renewal model (including auto-renewals and multi-year contracts), reducing reliance on the enterprise segment, expanding into small and mid-market clients through self sign-up, and broadening the product’s relevance beyond recruitment teams to HR and executives. He also described a change in value proposition over time, from helping clients “hire more” to helping them “reduce turnover” and “increase engagement” through references, background checks, engagement tools, exit surveys, and talent pools.
New platform growth: migrations, adoption, and marketplace usage
During the half, Seymour said 181 clients migrated from the legacy reference platform into the new platform, while 124 new clients joined who had not used Xref previously. Active clients on the platform reached 843, which he said represented a 54% increase versus the prior corresponding half.
He highlighted growth in self-service and usage metrics following the release of a roles and permissions capability in December, which allows clients to provision teams and manage access across products. Seymour said:
- Platform users grew 148% to 7,000.
- Surveys requested grew 130% year-on-year.
- Trust Marketplace checks increased 220%, with 400% more active users using Trust Marketplace from within the new platform during the half.
On expansion opportunities, Seymour pointed to exit surveys, pulse surveys, and Trust Marketplace as key areas for revenue and data growth. He offered an example that if Xref were to conduct exit surveys at 50% of the volume of its reference surveys, it could represent a AUD 7.5 million revenue increase.
As an example of “land and expand,” Seymour discussed Minor Hotels as a new client that began with reference checks, then adopted pulse surveys and later exit surveys.
Sales, marketing, and renewals
Xref signed 124 new clients in the half, which Seymour said was a 57% increase compared with the prior corresponding half. He cited an average invoice of about AUD 6,300 and client acquisition cost of about AUD 3,000. Seymour also described sector and geographic mix for net new clients, including that education, healthcare, and professional services represented 60% of the sectors joining, and that the company secured 22% of net new clients in North America. He also said 9% of the SMB market was attracted during the half, which he attributed to self-sign-up technology launched in May.
On marketing, Seymour said the company delivered just over 2,000 leads, a 250% increase versus the prior corresponding half, using content downloads, demo requests, self-sign-ups, ATS-channel activity, and Trust Marketplace campaigns. He said Xref created AUD 3.4 million of pipeline that is rolling into the current half.
In renewals, Seymour said 431 clients renewed during the half and that 43 renewals included upsell. He said upsells totaled about AUD 1.0 million across products including Engage and Trust Marketplace. He also said Xref sold about AUD 180,000 of “cap extensions” to about 50 clients instead of allowing early renewals, and deferred AUD 600,000 of renewals to future periods. Seymour said 30% of renewing clients signed either auto-renew credit card contracts or multi-year contracts, and 12% paid multi-year contracts upfront. He said revenue churn remained around 15%, which he attributed to market pressures, lower budgets, and competition.
Operational efficiency and AI usage
Seymour said Xref now has 60 people including five board members. He highlighted productivity metrics across teams, including an average of AUD 1.2 million in annual contribution per sales team member and 127 deals closed per year per salesperson, as presented. In customer success, he said the team closes 45,000 cases per year and noted that an AI agent is solving 15,000 cases annually, reducing manual caseload by 25% in the half. He also cited 99.9% uptime and said the company maintained a 73% employee engagement score and 95% employee retention rate despite headcount changes.
Within development, Seymour said 57% of 500,000 lines of code deployed during the half were AI-generated, used “alongside” staff in testing and development.
He also cited revenue per head of AUD 362,000, which he said indicates the company is outperforming the industry on that measure.
Product direction: “metadata API” and a single platform brand
Seymour emphasized the company’s proprietary data lake, describing it as including 26 years of engagement data and benchmarking, 16 years of employment data, and 9 million career histories. He said the survey data is “public opinion” that “did not exist before we collected it” and “cannot be synthetically created by LLMs.”
Looking ahead, Seymour said investors should expect to hear more about the company’s metadata API, which is intended to enable candidates to surface reference and verification metadata at the point of application—addressing what he called the industry’s shift to “References available on request.” He said the approach could help candidates strengthen applications, allow employers to hire faster with earlier information, and keep historic data updated.
He also said the company will stop referring to its technology as the “new platform,” and instead call it simply Xref.
On balance sheet priorities, Seymour said debt reduction is “top of mind,” with a stated goal of meeting obligations without further capital raises. He said the first debt tranche is due in February 2028 and the second in May 2028, giving the company time to improve its position. He outlined capital allocation priorities including debt retirement, AI efficiency, completing SaaS migration (and reducing legacy platform costs), margin expansion, and net new client growth.
Seymour also announced the appointment of a new company secretary, Camille, and thanked outgoing company secretary Robert Waring for 10 years of service.
About Xref (ASX:XF1)
Xref Limited engages in the development of human resources technology that automates the candidate reference process for employers in Australia, Canada, the United Kingdom, New Zealand, and the United States. It operates through three segments: Candidate Referencing, ID Verification, Engagement Surveys. The company offers Xref, an automated reference checking software for talent acquisition, recruitment process outsourcing, staffing and recruitment firms, and people and culture. It serves not-for-profit, health and aged care, hospitality, construction, and retail industries, as well as government sector.
