LifeSpeak Inc. (LSPK) Earnings Call Transcript & Summary

Welcome to the Annual Meeting of Shareholders of LifeSpeak Inc. Please note, the meeting is being recorded. I would like to introduce Nolan Bederman, Executive Chair of LifeSpeak. Mr. Bederman, please go ahead.

Thank you. Good morning, everyone. I'd like to welcome you to the Annual Meeting of holders of common shares of LifeSpeak, Inc. I now call to order this meeting of the shareholders of LifeSpeak. My name is Nolan Bederman, and I'm the Executive Chair of LifeSpeak, Inc. In accordance with the company's bylaws, I will chair today's meeting. It's my pleasure to welcome the shareholders, directors and officers of LifeSpeak Inc. and guests present today. The persons entitled to attend and vote at this meeting are the holders of common shares of the company or their validly appointed proxy nominees as at the record date. Also presenting today is Michael Held, Chief Executive Officer. Other LifeSpeak executives in attendance include Michael McKenna, Chief Financial Officer; Raffi Tchakmakjian, Jason Von Bank, Adam Goldberg, Doug Berkowitz and Anna Mittag. All current directors of LifeSpeak are standing for election today and are all in attendance. They include Sanjiv Samant, Anne Fitzgerald, Caroline Starner Dadras, Kevin Smith and Mario Di Pietro. As this meeting is being held virtually via live audiocast, we think it's necessary to set out a few rules for the orderly conduct of the meeting. First, for the purposes of this meeting, voting on all matters will be conducted by electronic ballot through the TSX Trust System. Only registered shareholders and validly appointed proxy nominees are able to vote by electronic ballot. Voting on each business item will open for all resolutions now and will close after the presentation of the last business item. Please note that any votes cast by electronic ballot during the meeting will supersede any votes previously submitted by proxy. Therefore, shareholders who have already voted by proxy and do not wish to change their vote, do not need to vote on polls taken during the meeting. Those in attendance who have registered as guests are not able to move motions, or vote, but are invited to submit questions at any time during the meeting. These questions will be answered during the management presentation portion. When you're asked to vote on the TSX Trust platform, click on the Voting icon. You will only have a certain amount of time to vote when the polls are open. Once the electronic balloting closes, your votes will automatically be submitted. We'll provide you with all voting results for all resolutions at the end of the meeting. For specific vote tabulations, please see LifeSpeak's report on voting result to be posted LifeSpeak's SEDAR profile at sedar.com shortly after the meeting. Questions or objections in respect of a motion can be submitted by any registered shareholder as applicable or any validly appointed proxy nominee by contacting TSX Trust. Please note that there may be a delay of approximately 15 seconds before the moderator will be able to see a submitted question. Therefore, at various intervals throughout the meeting, we will pause and provide you with 15 seconds to ask your questions using the messaging interface. If you feel 15 seconds is not enough time, please indicate that you have a question using the messaging interface, and we will pause the meeting until you've had an opportunity to submit your question. Although questions can be submitted throughout the meeting, they will be addressed at the appropriate time during the meeting. Please limit your questions to topics relating to today's subject matter and keep your questions short and to the point. For each question we answer, we will read the question and provide an oral response. Any questions which were already answered or that are redundant or repetitive will not be answered. For the sake of expediency, the company has arranged for certain shareholders, namely Doug Berkowitz and Anna Mittag, to move and second motions today, respectively. We will now proceed with the formal portion of the meeting. Unless there is any objection, Mike McKenna, Chief Financial Officer, will act as Secretary of the meeting and TSX Trust will act as scrutineer of the meeting. If you have an objection regarding the appointment of the secretary or the scrutineer, you now have 15 seconds to submit your objection via the message link. As no objections have been received, I will now move to the constitution of the meeting. The purpose of today's meeting is set out in the management information circular dated April 26, '22, which I will refer to as the Circular, made available to shareholders on May 9, 2022, together with the notice of the meeting, which I will refer to as the Notice, and the form of proxy or voting instruction form as applicable. The circular and other meeting materials have been posted on the company's website at investors.lifespeak.com and on the company's profile at sedar.com. I have here an attestation from TSX Trust indicating that proper notice of the meeting has been given in accordance with the Canada Business Corporations Act and the bylaws of the company. I direct that a copy of such proof of service be annexed to the minutes of the meeting as a schedule. Copies of the circular and other meeting materials are available under the company's profile on SEDAR. I will dispense of the reading of the notice and will now move to the scrutineer's report and quorum of the meeting. The scrutineers provided me with the preliminary report regarding shareholder attendance at the meeting. I've been advised by the scrutineers that there are sufficient shareholders here in person or represented by proxy constitute a quorum. I direct that the formal scrutineer's report be annexed to the minutes of the meeting as a schedule. I now declare that the meeting has been duly called and properly constituted the transaction of business. The first item of business is the presentation of the company's consolidated financial statements for the financial year ended December 31, 2021, and the auditor's report thereon. Unless there is any objection, I'll dispense with the reading of the auditor's report. Are there any objections? As no objections have been received, I will proceed to the next item of business. The next item of business is the election of directors. The 7 directors to be elected by the shareholders of the company shall hold office until the close of the next Annual Meeting of the shareholders or until his or her successors are duly elected or appointed: myself, Nolan Bederman; Michael Held; Sanjiv Samant; Anne Fitzgerald; Caroline Starner Dadras; Kevin Smith; and Mario Di Pietro, have been nominated as directors for the ensuing year or until their successors are elected or appointed. Each of the persons nominated has confirmed that he or she is prepared to serve as a director. Each of them qualifies as a director under the provisions of the Canada Business Corporations Act. Doug, would you kindly introduce a motion proposing the election of these 7 directors?

I move that each of the 7 persons nominated be elected directors of the company until the next Annual Meeting of Shareholders or until such time as their successors have been duly elected or appointed.

Mr. Chairman, I second that motion.

Thank you. Unless there are any questions, we will proceed to voting. You have 15 seconds to submit your question via -- or your vote by the Ask a Question link starting now. As there are no questions, and in accordance with the advanced notice provisions of the company's bylaws, no further nominations will be made at this time. I would now ask shareholders and proxy holders present to vote online. We will now pause for 30 seconds while you record your votes on this motion. You'll be able to vote for each director individually. Again, as a reminder, if a shareholder has previously voted and does not wish to change their vote, you do not need to do anything. Shareholders and appointees, please click on the Voting button to open the voting. [Voting]

I will now move to the next item of business. As noted earlier, voting results for all resolutions will be summarized at the end of the meeting. The next item of business is to appoint MNP LLP as the auditors of the company for the ensuing year and to authorize the directors to fix their remuneration. I call on Doug Berkowitz to make the motion.

I move that MNP LLP be appointed as auditors of the company until the next Annual Meeting of Shareholders and as a director, be authorized to fix their remuneration.

Mr. Chairman, I second that motion.

Unless there are any questions, we will proceed to voting. You have 15 seconds to submit your questions via the Ask a Question link starting now. As there are no questions, I'll proceed. I would now ask shareholders and proxy holders present to vote online. We will now pause for 30 seconds while you record your votes on this motion. Shareholders and appointees, please click on the Voting button to open the voting. [Voting]

Voting is now closed on all resolutions. Good? The scrutineer has provided a preliminary scrutiny report with votes for all resolutions and will provide final results after the meeting. Based on the tabulation, I can confirm that the requisite approvals have been obtained for the election of the nominated directors and the appointment of auditors. The voting results of this meeting will be posted on the company's SEDAR profile at sedar.com after this meeting. The formal items of business as set out in the notice have now been dealt with. If there isn't any other business, we will proceed to terminate the formal part of the meeting. After that time, I'll provide further comments. Is there any further business? If you'd like to raise any further business at the meeting, you can do so by using the Ask a Question link. You have 15 seconds to submit any further business using the Ask a Question button. As there are no further business, may I have a motion that the meeting be concluded?

I move that the meeting be concluded.

Mr. Chairman, I second that motion.

Is there any objection to the meeting being terminated? Thank you. As there are no objections, I declare the formal portion of the meeting terminated. On behalf of the Board of Directors, I'd like to thank you for attending today. We'll now turn to a presentation by management, followed by the opportunity to ask questions. TSX Trust, please put the presentation on screen.

Good morning, everyone. We appreciate you attending our 2021 Virtual AGM. During this presentation, we may be making forward-looking remarks inciting non-IFRS financial measures and key performance indicators that are not recognized measures under IFRS. So we'd encourage you to review Slides 2 and 3 in greater detail, please. I'm pleased to report that 2021 was a truly transformative year for LifeSpeak. Not only did we increase our revenue by 130% year-over-year, but we materially scaled and diversified our business through highly strategic M&A. We broadened our geographic presence and deepened our management team, all in the short time following our IPO on the Toronto Stock Exchange in July of 2021. A significant catalyst for our success is that organizations across the world are increasingly seeking mental health and total wellbeing solutions to address the essential connection between wellbeing and productivity. And that's the intersection where LifeSpeak can really make a difference. Our B2B SaaS-based mental health and total well-being platform consists of a full suite of mental health and total well-being tools, scalable SaaS technology, a deep proprietary database of content and a unique customer understanding and curation expertise. All of this can affect positive change for employees and supports our leading position in an industry where organizations are ascribing greater value than ever to the mental health and total wellbeing of their people. As a business, we benefit from a number of long-term tailwinds that we believe are accelerating. These include increased spending on mental health, the digitalization of health solutions and a growing spend on digital micro learning, all at the corporate level. These factors reinforce that mental health and total wellbeing continues to be a C-suite issue and organizations are continuing to invest in digital solutions to address the complex needs of employees. All of this has culminated in a strong year financially for LifeSpeak. In fiscal 2021, our revenue increased 131% compared to 2020. Annual recurring revenue increased 98% compared to 2020, and adjusted EBITDA was 105% higher versus 2020. I will now turn the presentation over to Nolan for his remarks. Nolan?

Thanks, Michael. As we progress into 2022, we have transformed LifeSpeak into a much stronger and more diverse company than ever before. After successfully closing 4 synergistic and complementary acquisitions, including LIFT Session, ALAViDA and Torchlight in the fourth quarter of 2021 and Wellbeats in the first quarter of 2022, LifeSpeak can now more effectively and holistically help employees with their mental health and physical well-being. We can also offer organizations a suite of services to help employees care for their children or other lead parents, and we can help employees who may have substance-use disorders. The combination of these products allows us to offer a holistic SaaS-based platform to clients seeking multiple products to address employee mental and physical health and wellness. Or if preferable for the client, we can offer each as an individual service or in any combination that helps them achieve their goals. We remain extremely optimistic about our future, given our multipronged and diverse go-to-market strategy, which helps us maximize the reach of our services. LifeSpeak has a 3-pronged strategy to approach new customers with its offerings. One, direct sales consist of an in-house sales team in Canada, the U.S. and select international locations, supported by a group of talented individuals who are focused on onboarding and upselling new features and content to clients. Two, we have a deep bench of referral and channel partners, including benefits and health plan providers, wellness platforms and benefits consultants who market LifeSpeak's platform as part of their suite of offerings. We leverage our partner networks and relationships for a broad-based and efficient sales process. And finally, our embedded solutions help incorporate our platform into client solutions for additional benefit and value for their own end users as well as an economical and scalable approach to small business. These 3 initiatives are complemented further by the significant cross-sell opportunities throughout our existing enterprise and embedded client base, which now exceeds 800 clients. We believe that our Q1 2022 results demonstrate that our go-to-market strategy holds great potential going forward. We reported a quarter with $8.7 million of revenue and annual recurring revenue of more than $51 million. At quarter end, we had 873 clients, representing a far greater diversity within our client base, both geographically and with regards to the services we provide with significantly more dispersed revenue concentration than ever before. Looking ahead, we remain highly confident about our prospects for growth. As we look at our business today and forward to the remainder of 2022, we are confident that our growth will continue as we market the broader platform we have assembled, including our core mental health, physical health and total wellbeing tools. As we continue to grow our client base through the acquisition of new enterprise clients and growth with our embedded solutions, and as we take our product global beyond the borders of our client base, which has historically been predominantly Canadian. Overall, we believe we are strongly poised to leverage our leadership position and our holistic platform to build greater value for shareholders. We believe that our deep and diverse customer base demonstrates the efficacy of our business model, and we are only just beginning to realize our full potential. The scale we've reached today with over 800 clients, the pace at which we've grown and the resulting retention rate we achieved all demonstrate that our solution is essential to our clients and to their employees. We're looking forward to updating you on our progress in the coming weeks and months, and we'll now open the meeting to questions.

Please give us a minute to review any questions coming in.