The Xero Limited (ASX: XRO) share price opened weaker on Thursday after the company released its 2021 annual meeting chair and CEO address.
At the time of writing, shares in the account software company have pulled back 1.74% to $143.01.
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Xero annual meeting highlights
Digitisation tailwinds
Xero chair David Thodey commented on the "significant shift in the way business is conducted, as digitisation accelerates across industries and small businesses adopt cloud technologies as part of their core business toolkit".
Thodey pointed to a number of government measures driving business digitisation including:
- UK Government's push to digitalise its tax system and digitally enable small businesses.
- The Australian Government's $1.2 billion investment into its 'digital economy' to lift digital capability and adoption.
- US President Joe Biden's executive order suggesting consumers should be allowed to access their banking data, likely a move towards open banking.
Xero believes it is strongly positioned for this accelerating global trend, with the opportunity to serve the global small business community.
Management reiterated the strong progress the company has made, with a record number of new subscribers in the second half of the year.
Focus areas
As Xero continues to expand as a global accounting platform for small businesses, Thodey shed light on some key areas.
One aspect was the continued use of mergers and acquisitions to add to the company's capabilities.
The optimisation of Xero's operational and financial structure was another factor. The company pointed to its convertible note refinancing as a "great example" which allowed it to deploy funds for three acquisitions made during the year.
The company also highlighted the importance of risk management, particularly around the area of cyber risk.
No update for FY22
Xero CEO Steve Vamos said there would be no update in today's announcement. However, he reiterated a few elements from the company's FY21 results.
He said FY22 total operating expenses as a percentage of operating revenue should in the range of 80% to 85%.
Additionally, the Planday acquisition is expected to contribute approximately three percentage points of additional operating revenue growth in FY22.
Xero share price snapshot
The Xero share price hasn't really gone anywhere, edging 3.7% lower year-to-date.
The main driver of Xero's recent underperformance could be the company's full-year FY21 results on 13 May. These triggered a sharp 11% selloff on the day of the announcement.
