A significant increase in the number of properties sold and gross commission income (GCI) achieved has underpinned The Agency posting revenue of $72.7 million in the 2021-2022 financial year.
The revenue marks a 24 per cent increase on the previous financial year, while underlying EBITDA (earnings before interest, taxes, depreciation and amortisation) climbed 26 per cent to $3.85 million.
The growth has been driven by a 27 per cent year-on-year rise in GCI from $80.7 million up to $102.5 million, with the increase in GCI attributed to a 15 per cent increase in the number of properties sold.
In the 2022 financial year, The Agency sold 5709 properties, which was up from 4964 the year before.
Further economies of scale were achieved, with The Agency’s cost of doing business ratio falling from 34.7 per cent to 30.3 per cent of revenue.
As at 30 June 2022, the group’s cash and cash equivalents were $8.2 million, up from $5.1 million at the same time last year.
The Agency Managing Director and Chief Executive Officer Geoff Lucas said the group was pleased with the results delivered for its shareholders.
“Expanding our geographic reach, increasing agent numbers, growing our local market presence at a lower cost of doing business are our strategic growth levers that are delivering a solid platform for execution of our future objectives,” Mr Lucas said.
“Across the past 12 months, we’ve increased our team by 85 agents, taking us to 393 agents, compared to 308 in the previous year.
“This agent growth underpinned our GCI uplift to $102.5m, which is just a fraction of the $7.6 billion total annual Australian residential real estate commissions pool.
“Our business is well positioned to continue growing our share of this pool.”
Mr Lucas said The Agency had revised its national price movement to falls of between four per cent and eight per cent.
“We believe consumer confidence will return as the quantum of interest rate movements reduce and a terminal value for this cycle is reached,” he said.
“Once consumer confidence returns, we believe this will lead to a recovery in transaction volumes.”
“At 30 June 2022, the value of Australian residential real estate was $9.95 trillion dollars – nearly four times the size of the value of the Australian listed stocks and about three times the size of the entire Australian superannuation industry.
“Consumers should continue to take a long-term view with decisions around their real estate assets.”
Mr Lucas said although this year’s results were pleasing, there remains market share potential ahead for The Agency.
“From our assessment, we’ve calculated that we sold a property in around 34 per cent of the addressable market in the past 12 months,” he said.
“This shows the potential reach of our current infrastructure but also highlights that we have many further markets to tap into as we grow our national market share.
“Our strategy is to build depth in these existing markets as well as grow into additional markets.”