The Oil Search Ltd (ASX: OSH) share price is on the move today following the release of its first quarter update.

In early trade, the energy producer’s shares are down 1.5% to $3.72.

How did Oil Search perform during the first quarter?

For the three months ended 31 March, Oil Search’s total net production came in at 6.9 mmboe.

This was down 2.7% from the fourth quarter and 6.8% from the prior corresponding period. Management advised that production was impacted by an unplanned Hides shutdown.

However, thanks to a sharp rise in realised prices during the quarter, Oil Search recorded first quarter operating revenue of US$301.5 million.

This was up 16% from the fourth quarter. However, with LNG and gas prices still down meaningfully from a year earlier, operating revenue dropped 16% on the prior corresponding period.

Nevertheless, the company finished the period with an improved liquidity position. At the end of March, Oil Search had US$1.57 billion of total liquidity.

What about the rest of FY 2021?

Pleasingly, despite its weak first quarter, Oil Search’s production guidance for FY 2021 remains unchanged.

Another positive is that its investment expenditure guidance has been reduced by between US$75 million and US$95 million. This is being driven by cost savings and the effects of travel restrictions in PNG.

Also remaining unchanged is its unit production costs guidance of US$10.50 to US$11.50 boe.

Though, one item that has been revised higher is its other operating costs guidance. Oil Search now expects these costs to be US$20 million higher than its previous guidance at between US$145 million to US$165 million in FY 2021.

This change has been made to reflect the cost of its hedging program announced in February and for higher royalties and levies resulting from higher realised prices.

Management commentary

Oil Search’s Managing Director Dr. Keiran Wulff said “Oil Search has maintained stable operating performance during the quarter amid challenging logistical conditions imposed by COVID-19 in PNG in particular. With escalating cases in PNG, Oil Search continues to deploy stringent mitigation and protective measures such as strict quarantining of our staff and segregation of our field activities from local communities. Notwithstanding this, Oil Search continues to offer support to the PNG and Australian governments in helping to combat the outbreak.”

“Our operated assets at Moran and Agogo significantly outperformed our budget expectations and helped offset lower PNG LNG production, which was impacted by a short shutdown at Hides. Despite the short shutdown, PNG LNG continued to deliver all long-term contracted cargos.”

More reading

• 5 things to watch on the ASX 200 on Thursday
• Why ASX mining shares are likely to jump this morning
• ASX 200 energy shares outlook boosted by mega African oil project
• ASX energy companies drained value as Suez Canal reopened
• The ASX sector set to outperform this morning thanks to Suez

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The AMP Ltd (ASX: AMP) share price is pushing higher on Friday morning.

At the time of writing, the financial services company’s shares are up 3% to $1.16.

Why is the AMP share price pushing higher?

Investors have been buying AMP shares after it followed in the footsteps of AGL Energy Limited (ASX: AGL) and Telstra Corporation Ltd (ASX: TLS) by announcing demerger plans.

According to the release, the company intends to pursue a demerger of AMP Capital’s Private Markets business of infrastructure equity, infrastructure debt and real estate.

Management explained that the proposed demerger follows a decision by the AMP Board to conclude discussions with Ares Management Corporation regarding a potential sale of Private Markets.

What will the demerger look like?

The release explains that the demerger would create two focused businesses, better equipped to pursue and allocate capital to distinct growth opportunities and realise efficiencies.

AMP Limited will be a retail-focused, wealth management, investment and banking group with scale and market-leading positions in the Australian and New Zealand markets and strategic investments in key international partnerships.

It will also retain a minority stake in Private Markets of up to 20% to participate in the future growth of the business.

Furthermore, it will retain AMP Capital’s Global Equity and Fixed Income (GEFI) business for at least the time being. AMP is currently exploring sale or partnership options for this business.

Similarly, it will be home to AMP Capital’s Multi-Asset Group, which is in the process of being transferred to the AMP Australia business

Whereas the new Private Markets business will be a leading global private markets investment manager with a strong performance track record in differentiated asset classes of infrastructure equity, infrastructure debt and real estate, and capabilities to expand into attractive growth adjacencies.

In addition, management believes the proposed demerger would unlock further value in the Private Markets business by simplifying its structure, providing operational independence and enabling it to establish a new brand. Private Markets will also put in place a new management equity plan, to attract and retain talented investment professionals and management.

“Significantly benefit both business units”

AMP’s Chair, Debra Hazelton, commented: “Our portfolio review confirmed that AMP has two distinct businesses in retail wealth and institutional private markets, with different client bases and growth opportunities. From the extensive work that has been done we believe that operational and structural separation will significantly benefit both business units. The Private Markets business operates in growing, global markets in which investment management talent and strong client relationships are critical. While AMP Australia and New Zealand Wealth Management share the same commitment to clients, they are predominantly domestic businesses focused on wealth, banking and investment solutions for retail customers.”

“Through our review, we assessed the alternatives of a sale or separation for Private Markets and found both options would support the acceleration of growth in the business. We have had substantial and constructive discussions with Ares regarding a sale, however, we have not been able to reach an agreement that would deliver appropriate value for our shareholders. The Board has therefore concluded a demerger provides investors with the strongest value outcome, creating two more focused entities, with the agility to pursue new growth opportunities in their respective markets. We will now accelerate our demerger planning, building on the preliminary work already undertaken.”

More reading

• Why AMP, Challenger, Pilbara Minerals, & Redbubble shares are tumbling lower
• ASX 200 up 0.2%: AMP sinks, Redbubble crashes, Megaport jumps
• AMP (ASX:AMP) share price on watch after Q1 update
• AMP (ASX:AMP) share price hits new 52-week low
• ASX 200 Weekly Wrap: ASX sees 7,000 points once more

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Kogan.com Ltd (ASX: KGN) share price has plummeted in early trade today, dropping 10.4% in the opening moments. That comes after the Aussie online retailer’s latest business update highlighting “strong growth” in multiple metrics.

At the time of writing, the Kogan share price is trading at $11.17 apiece. 

What’s driving the Kogan share price?

Kogan this morning provided an update for the quarter ended 31 March 2021 (Q3 2021).

The Aussie conglomerate reported a more than 47% increase in group gross sales, comprising both Kogan.com and Mighty Ape. Kogan is integrating Mighty Ape after acquiring the Kiwi online retailer for $122 million in December 2020. 

Kogan Group grew by more than 65% during the quarter with gross profit up more than 54% after another strong quarter.

Kogan.com revenue grew by more than 41% with growth across the board. That includes Exclusive Brands growth of 63% and Marketplace revenue up more than 100%. Third Party Brands and Kogan Mobile revenue grew by more than 13% and 23%, respectively.

Kogan reported fluctuating customer demand during the quarter as the company increased its inventory levels. That saw the retail group incur higher storage and demurrage fees for the quarter which could have investors watching the Kogan share price closely.

Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) declined by more than 24% during the quarter. That was thanks to increased operating costs and significant investments in marketing and people. There were also increased costs arising from the Mighty Ape acquisition and equity-based compensation expenses.

The Kogan share price is one to watch this morning following the update on its business and customer numbers. Active customers grew by more than 77% to 3,215,000 for Kogan.com with a further 742,000 active customers for Mighty Ape.

Shares in the Aussie retailer performed strongly in 2020 as online retail boomed during the coronavirus pandemic. The Kogan share price is up 78.1% in the last 12 months prior to this morning’s open.

However, the company has seen a 42.5% decline in its valuation since 25 January and is currently trading with a $1.3 billion market capitalisation.

More reading

• 2 dirt cheap ASX shares to buy next week
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• This could be boosting the Kogan (ASX:KGN) share price today

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Kogan.com ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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In morning trade, the Core Lithium Ltd (ASX: CXO) share price is shooting higher.

At the time of writing, the Northern Territory-based lithium developer’s shares are up 8% to 27.5 cents.

Why is the Core Lithium share price shooting higher?

Investors have been buying Core Lithium’s shares this morning following the release of a very positive announcement.

According to the release, new geophysical surveys have successfully shown a strong correlation with lithium pegmatite distribution within its wholly owned Finniss Lithium Project.

The company notes that gravity geophysics is now considered an important tool for mapping lithium rich pegmatites within the Finnis pegmatite field.

The Finniss Gravity survey, which was co-funded by the Northern Territory Government, has identified a major NNE-trending gravity high and potential lithium-pegmatite corridor.

Management believes there is no reason to believe that these known lithium pegmatite groups are unique clusters. Rather, it believes it is far more likely that the currently defined distribution of pegmatites identified to date in this belt are due to large tracts of prospective ground which are covered by laterite or soil cover that have not been effectively explored yet.

What’s next?

Core Lithium will now commence with follow-up detailed gravity surveys during the current quarter over key target areas. The company notes that these areas have the potential to directly identify pegmatite drill targets and focus its upcoming exploration and drilling campaigns.

Core Lithium’s Managing Director, Stephen Biggins, said: “This new gravity survey, cooperatively co-funded with the NT Government, has shown to be a real gamechanger for lithium exploration in the NT. The Finniss Gravity Survey has identified new key target areas and we planning follow-up gravity surveys alongside our huge lithium exploration and resource drilling push starting in May.”

“In parallel with anticipated resource growth from the Project, Core is finalising key commercial and financial Project milestones to enable the Company to reach FID [final investment decision] next Quarter,” he concluded.

More reading

• ASX lithium shares are surging across the board. Here’s why
• Here’s why the Core Lithium (ASX:CXO) share price is charging higher

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Harvest Technology Group Ltd (ASX: HTG) shares are on watch today after the company released news of an acquisition this morning. The industrial communications group said the acquisition would mark the start of its expansion into the United States and international markets.

The Harvest Technology share price closed yesterday’s session at 33 cents.

Let’s take a closer look at the company’s announcement. 

Acquisition underway 

Harvest Technology announced today it has signed a binding term sheet to acquire US-based SnapSupport Inc., a software as a service (SaaS) provider.  

The company also said it will accelerate its strategic swing towards a SaaS business model.

SnapSupport works to help remote field workers during equipment failures. It provides real-time visual and augmented-reality-enabled support to help fix issues quickly.

According to Harvest Technology’s release, SnapSupport’s business model fits well with its own. Harvest Technology provides connectivity solutions for the energy, resources and renewable sectors. 

The deal on the table is for the company to pay approximately $2.59 million worth of Harvest Technology shares, paid over two instalments, to acquire SnapSupport. Half will be paid on completion of the acquisition, the other half will be due 12 months later.

The acquisition deal hangs on some key terms – due diligence, a purchase agreement, and an employment agreement for a key employee.

Commentary from management

Harvest Technology’s managing director Paul Guilfoyle commented on the potential acquisition, saying:

The acquisition of SnapSupport, who have commercially viable solutions that are already supporting largescale global customers with over 900 active users at any one time, will provide us with a fast and cost-effective pathway to speed-up the global rollout of our SaaS business model.

The SnapSupport mobile platform is proven, fit-for-purpose and can quickly and efficiently harness the advantages of our own Industrial Grade Connectivity capability.

Harvest Technology share price snapshot

The Harvest Technology share price has been performing well on the ASX lately.

Currently, it is up 6% year to date. It’s also up by 175% over the last 12 months.

Harvest Technology has a market capitalisation of around $162 million, with approximately 493 million shares outstanding.

More reading

• Why the Perpetual (ASX:PPT) share price is in focus
• 3 Reasons Cathie Wood has invested $580 million in Coinbase’s IPO
• Why the Carbon Revolution (ASX:CBR) share price is frozen
• Accent (ASX:AX1) share price on watch after announcing Glue acquisition
• Why the Limeade (ASX:LME) share price is on watch

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Perpetual Limited (ASX: PPT) share price is one to watch after the Aussie investment manager’s latest quarterly update.

Why is the Perpetual share price in focus?

Perpetual this morning provided a business update for the period ended 31 March 2021 (Q3 2021). The Aussie investment group reported total assets under management (AUM) of A$95.3 billion, up 6.8% from the previous quarter. 

Australia AUM climbed 4.4% to $23.7 million while Perpetual Asset Management International AUM climbed 7.7% to $71.6 million.

Fixed income saw the only positive net flows across asset classes on a combined basis during the quarter but still edged lower to $20.6 million in AUM. The asset class was the worst performing segment for the quarter given strong gains across equities.

Net outflows were A$892 million which were offset by A$5.3 billion in asset growth thanks to a strong market. A positive currency impact of A$783 million also helped boost overall performance for the quarter.

The Perpetual share price is one to watch in early trade following this morning’s update. Total combined equities experienced A$1.4 billion in net outflows for the quarter but also saw the strongest gains. That was particularly the case for US equities which gained A$4.9 billion in value as well as $0.5 billion in favourable currency movements.

Perpetual Corporate Trust’s Funds under Administration (FUA) grew by 1% to A$942.9 billion during the quarter. The Aussie fund manager cited “continued momentum” from its adviser growth strategy in Perpetual Private. That included a 4% gain in Funds Under Advice to A$16.1 billion with A$0.2 billion of positive net inflows.

Foolish takeaway

The Perpetual share price is one to watch given its strong recent gains. Shares in the investment manager are up 25.1% since the start of November to $33.80 per share.

Today’s quarterly update reflected the bullish equities markets seen in the first quarter which more than offset the net outflows from institutional accounts.

More reading

• The Harvest Technology (ASX:HTG) share price is on watch. Here’s why
• 3 Reasons Cathie Wood has invested $580 million in Coinbase’s IPO
• Why the Carbon Revolution (ASX:CBR) share price is frozen
• Accent (ASX:AX1) share price on watch after announcing Glue acquisition
• Why the Limeade (ASX:LME) share price is on watch

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Cathie Wood has become something of an investing phenomenon over the past year. The founder and CEO of ARK Investment Management made a name for herself in 2020 when her five flagship exchange-traded funds (ETFs) crushed the returns of the broader market, each notching gains of more than 100%, by focusing on emerging technologies and disruptive high-growth stocks.

Wood made headlines again last week when she invested in Coinbase Global (NASDAQ: COIN) on the day it went public. ARK hasn’t stopped there, buying more Coinbase stock each day since its direct listing. ARK Invest now owns almost 1.9 million Coinbase shares — worth roughly $580 million at Thursday’s prices — in three of the firm’s ETFs: ARK Fintech Innovation (NYSEARCA: ARKF), ARK Innovation (NYSEARCA: ARKK), and ARK Next Generation Internet (NYSEARCA: ARKW). 

Let’s look at three reasons Wood was so quick to add Coinbase shares to ARK Invest’s coffers.

1. A breakout year for Coinbase

The ongoing boom in cryptocurrency has attracted the attention of novice and experienced investors alike. Coinbase Global is the leading cryptocurrency exchange in the U.S., allowing enthusiasts to buy and sell a wide range of popular digital currencies. The company makes the majority of its revenue from the transaction fees it charges for each sale.

The platform has more than 56 million individual users, 7,000 institutions, and 115,000 partners in over 100 countries. Its growing user base gives the company an unmatched ecosystem that has something for everyone, from the beginning cryptocurrency enthusiast to the more experienced buyer. 

2020 was a breakout year for Coinbase, so it isn’t surprising that it caught Wood’s attention. Coinbase reported that revenue grew 139% year over year to $1.14 billion. At the same time, profits turned positive with a net income of $322 million, pivoting from a loss of $30 million in 2019. As a result, the company’s adjusted EBITDA surged more than 2,000% to $527 million. 

Preliminary results show that growth accelerated during the first quarter of this year. Revenue surged to $1.8 billion, a ninefold increase from $191 million in the prior-year quarter. For context, revenue tripled compared to the fourth quarter, while exceeding Coinbase’s revenue for all of last year. While the final numbers haven’t been released, net income is expected to be in a range of $730 million to $800 million, soaring nearly 2,300% year over year, at the midpoint of its range. 

Given the eye-catching results, Coinbase would have certainly been on Wood’s radar.

2. A longtime believer in cryptocurrency

Wood has long been a proponent of digital assets, buying Bitcoin back in 2015 — before it entered the zeitgeist. She was particularly intrigued by the potential for blockchain, the digital ledger technology that underpins cryptocurrency. Wood has even gone so far as to say that Bitcoin’s price could eventually top $500,000 — nine times its current price, which is around $55,000 at this writing. 

A quick look at ARK’s funds shows that Wood continues to bet big on the potential for cryptocurrency and blockchain. ARK Next Generation Internet holds more than 5% of its $6.9 billion in funds under management in Grayscale Bitcoin Trust — the first publicly traded security investing solely in Bitcoin.

That’s not all. Square is the No. 1, 2, or 3 holding of three ARK funds and was among the first to offer users more widespread cryptocurrency accessibility. The point-of-sale and digital payments provider first tested buying and selling Bitcoin on its platform in late 2017, before expanding access to all users in early 2018. Rival PayPal Holdings also debuted a service late last year that enables users to buy, hold, and sell cryptocurrency. The digital payments pioneer is another significant holding in two of ARK’s funds. 

3. Cryptocurrency is still in its infancy

While it may seem like cryptocurrency is finally entering the mainstream, it’s actually still early days for the digital payment method. Hester Peirce, a commissioner with the Securities and Exchange Commission, says cryptocurrency is still in its infancy, but interest is growing.

“We’re seeing more interest coming from institutional quarters than we have in the past,” Peirce said during a live-stream financial conference. “As people are more comfortable working in a virtual world in every industry now, I think people are likely to turn more interest to the crypto space. And as people are looking to diversify their portfolios, I think people are also likely to look more to the crypto space.” 

A recent study of 30,000 Americans found that roughly 57% say they understand cryptocurrency, about 14% say they are currently invested in crypto and another 15% are planning to invest, according to a nationwide poll conducted by Piplsay Research. 

Meanwhile, 43% of respondents said they either didn’t understand or hadn’t even heard of cryptocurrencies. This shows that cryptocurrency has a long way to go before it reaches maturity, with plenty of growth potential.

A bit of context

It’s important to put Wood’s purchase of Coinbase Global into context. After buying more than a million shares and spending hundreds of millions of dollars, Coinbase only amounts to a little more than 1% of funds under management for each of the three ARK funds that hold the stock.

By adding Coinbase into the mix, however, Wood is increasing her bet on the overall potential for cryptocurrency, without putting too many eggs in one basket.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• Aussie investors snapped up Coinbase (NASDAQ:COIN) shares last week
• Forget the Bitcoin price, the Dogecoin price is on fire!
• Cathie Wood ARK funds buy 750,000 Coinbase shares after IPO

Danny Vena owns shares of Bitcoin, PayPal Holdings, and Square and has the following options: long January 2021 $85.0 calls on PayPal Holdings. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Bitcoin, PayPal Holdings, and Square and recommends the following options: long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia has recommended PayPal Holdings. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Carbon Revolution Ltd (ASX: CBR) share price will start the day halted after a capital raising announcement from the Aussie manufacturer. Carbon Revolution this morning requested a trading halt from the ASX before a major capital raising announcement to fund its latest growth plans.

Why is the Carbon Revolution share price in focus?

Carbon Revolution provided an update on its pro-rata, accelerated, non-renounceable entitlement offer and institutional placement. It comes as the company has decided to commence construction of phase 1 of its first “Mega-line”.

The company has secured formal agreements to initiate detailed design and engineering relating to four new OEM (original equipment manufacturer) programs. A “significant proportion” of those relate to electric vehicles, with Carbon Revolution expecting a required 75,000 wheels per annum of additional capacity to meet demand.

That’s a significant increase in the company’s current production. To date, Carbon Revolution has sold ~40,000 wheels with 6 awarded programs announced by OEMs and in the market.

The Carbon Revolution share price will be one to watch when it resumes trading following the significant update from the Aussie manufacturer. CEO Jake Dingle said, “The award of these new OEM formal agreements validates Carbon Revolution’s strategy and our world-class products and technology”.

Carbon Revolution’s capital requirement to build phase 1 of the Mega-line is ~$47 million. The fully underwritten $95 million equity raise will raise ~$53.5 million, with the institutional placement to raise a further ~$41.6 million.

The equity raising, combined with additional working finance arrangements, should help Carbon Revolution to reach breakeven cash flow.

The Carbon Revolution share price could be on the move when it returns to the boards after the company’s news of the raise at $1.60 per share. That represents a 31.9% discount to the last closing price of $2.35 per share on Thursday 22 April.

Carbon Revolution will issue 26.0 million new shares under the placement component. A further 59.4 million new shares will be issued under the equity raising (or 40.6% of Carbon Revolution’s existing issued capital).

More reading

• 3 exciting small cap ASX shares to watch closely

Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Carbon Revolution Limited. The Motley Fool Australia has recommended Carbon Revolution Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Accent Group Ltd (ASX: AX1) share price will be one to watch on Friday.

This follows news that the footwear-focused retailer is adding to its collection of store brands with a new acquisition.

What is Accent acquiring?

This morning Accent confirmed reports that it has signed an agreement to acquire the Glue Store retail business and the wholesale and distribution brands business of Next Athleisure for a cash consideration of $13 million.

Glue Store is a leading Australian youth apparel, shoe and accessory retailer offering a range spanning global street, fashion, and sport cultures.

According to the release, Glue Store operates a network of 21 stores and an integrated online site, with around 500,000 loyalty program members. It currently generates annual sales of approximately $90 million, including $16.6 million of online sales.

As part of the acquisition, Accent revealed that it will acquire all of Next Athleisure’s exclusive owned vertical brands. This includes Nude Lucy, Beyond Her, Lulu & Rosem and Article One, which collectively drive more than 25% of total sales.

Next Athleisure also has distribution rights for a strong portfolio of global brands, including Superga, Ellesse, le coq sportif, Kappa, K-Way, Sebago and Napapijri. These rights will be transferred to Accent, subject to usual brand owner consent. 

Management advised that the Next Athleisure business will become a new division within Accent named Accent Lifestyle. The  current CEO of Next Athleisure, Darren Todd, will join Accent as the Group General Manager of Accent Lifestyle.

The acquisition is expected to complete in May. But due to its timing, it is not expected to have a material impact on Accent’s FY 2021 financial performance.

“Perfectly aligned”

Accent’s CEO, Daniel Agostinelli, commented “The NAL acquisition is perfectly aligned to our strategy to grow our leadership position in the lifestyle and youth apparel market in Australia and New Zealand. Glue Store, along with the NAL wholesale and distribution business, provides an established and complementary platform to accelerate our growing apparel business. It also comes with several exciting vertical owned brands, including Nude Lucy and Beyond Her, and a strong portfolio of global distributed brands.”

“We see significant opportunity to leverage Accent’s retail expertise to improve the Glue Store customer experience and store profitability. The youth apparel market is highly fragmented with significant opportunity to grow the store network and capture market share over time,” he added.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Limeade Inc (ASX: LME) share price is on watch after an early morning announcement from the US-based software company.

Why is the Limeade share price on watch?

Limeade is a Bellevue, Washington USA based employee software solutions group that currently boasts a $204.9 million market capitalisation on the ASX.

The Limeade share price will be one to watch after the software group’s latest quarterly update for the period ended 31 March 2021 (Q1 2021). Limeade said “pent up demand” remains for employee experience (EX) software following the coronavirus pandemic.

Limeade reported quarterly cash receipts from customers of $23.6 million – a record result for the growing company. Net cash receipts after adjusting for payments to the sale of third-party products and services was down 8% in Q1 2020 to $17.1 million.

Third-party payments were down 6% in Q1 2020 to $6.4 million. However, that figure remains a 177% increase over December quarter figures posted by Limeade.

Limeade said headcount continued to track at a lower rate than prospectus forecasts due to efficiencies and a hiring reduction due to uncertainty during the COVID-19 pandemic.

The Limeade share price will be one to watch this morning with the company’s valuation already falling 46.8% in 2021. 

Limeade reported a quarterly operating cash flow of $0.6 million, down 69% on Q1 2020 numbers. Overall year to date Net Revenue Retention was 98% as of 31 March 2021 according to the release.

On the balance sheet side, Limeade reported a $31.3 million cash balance while remaining debt-free during the quarter. One notable update for the quarter was the company reporting strong attendance for its fifth annual Limeade Engage conference. 

The conference was virtually held due to COVID-19 and attracted 275% more registrations compared to 2020. New customer prospects jumped 268% on the prior corresponding period to 545 registrants.

Limeade’s total sales and marketing pipeline fell 19% versus Q4 2020 to $182.4 million as early stage qualifying leads declined.

FY2021 guidance

The Limeade share price is one to watch this morning after an update on guidance from the software solutions group. Limeade has maintained full-year guidance of US$50 million to US$53 million revenue with forecast earnings before interest, tax, depreciation and amortisation (EBITDA) loss of US$5 million to US$8 million.

More reading

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• Could a dual listing drive the Afterpay (ASX:APT) share price higher? 
• 2 exciting ASX tech shares that are highly rated by analysts

Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Limeade, Inc. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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