McGrath posts $7.5 million profit and plan for more offices

McGrath now has 16 more offices and 81 more agents than it did a year ago, with a view to add 115 high quality new offices to the network over the next three to four years. 

The publicly released information formed part of an investor presentation today as the network unveiled its 2024 half-year results.

Managing Director and Chief Executive Officer John McGrath outlined McGrath’s balance sheet with revenue of $40.2 million and underlying EBITDA (earnings before interest, taxes, depreciation and amortisation) of $4.8 million for the first half of the financial year, a 42 per cent increase on the corresponding period a year ago.

Statutory net profit also increased from $1.8 million to $7.5 million, which was an increase of $5.7 million on the same time last year.

This includes the sale of selected offices and rent rolls, as well as a life in the value of the company’s investments. 

“We are delighted with the result as it reflects the focus of our management team, outstanding agents and our strong brand – factors which have  seen McGrath’s market share continuing to grow in our key markets,” Mr McGrath said.

“We are also showing strong momentum in the delivery of our key strategies announced in the last financial year. 

“An increase in our franchise offices is delivering a more stable income based on a fixed percentage of total sales commissions. 

“We have also upgraded the tools and technology to keep our agents at the top of their game, with the release of our agent app, an enhanced and new website and a brand redesign, all of which will better serve our agents and clients.”

Mr McGrath said the company continued to be in a strong financial position, with about $26 million in cash and no debt.

Net assets, including management’s estimate value of the property management rights not recorded on the balance sheet, are 54c per share. 

The company has declared a 1.5c per share, fully franked interim dividend and a 1.5c per share fully franked special dividend, payable from proceeds from the sale of selected company owned offices and rent rolls to be paid on March 12, 2024.

The investor presentation also revealed the number of McGrath agents had increased from 615 in the first half of the 2023 financial year to 696 now.

Similarly, the number of offices have increased from 115 to 131 and the number of properties sold has risen from 5569 to 6809.

The network’s average selling price has also increased 6 per cent from $1.30 million to $1.37 million.

The number of franchise properties under management also climbed 21 per cent, from 25,098 in the first half of the 2023 financial year, to 30,476 properties now.

Meanwhile the number of company-owned properties under management has dropped from 7855 to 5449.

Mr McGrath was also positive about the outlook for the company and the real estate market as a whole. 

“Despite economic headwinds and global uncertainty, the property market appears stable and in most areas prices continue to trend upwards,” he said.

“Our growth moving forward will be driven by increased agent productivity and more offices joining the group which will deliver increasing market share. 

“We have seen good listing volumes to the start of the calendar year and we are in great shape to continue our momentum.”

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Kylie Dulhunty

Kylie Dulhunty is the Editor at Elite Agent.