Industry newcomer The Agency has notched up an impressive year of growth, with financial results indicating annual group revenue increased 86 per cent during the 2018/19 financial year to $31.3 million. It follows on from 75 per cent growth and 70 per cent growth during the prior two years.
Across the board, The Agency figures for FY 2019 were strong, with listings, properties sold, properties under management, and agent numbers all increasing dramatically.
“Since launching this business model less than three years ago we have achieved outstanding financial and operating results, and have attracted some of the best agents,” Agency Managing Director Paul Niardone said.
“This has been a company-making year for The Agency in which we completed the Top Level Real Estate acquisition, expanded into key real estate markets and recruited strongly, despite wide challenging market conditions.”
That expansion and strong recruitment included:
- $31.3 million in total revenue – up 86 per cent on $16.8 million in FY 2018
- $33 million in cash receipts – up 120 per cent on $15 million in FY 2018
- 272 agents – up 47 per cent on 185 agents in FY 2018
- 3430 listings– up 43 per cent on 2401 listings in FY 2018
- 2419 properties sold – up 263 per cent on 667 properties sold in FY 2018
- 4337 properties under management – up 29 per cent on 3374 properties under management in FY 2018
The company report indicated the increase in revenue was primarily due to a 31 per cent increase year-on-year in Combined Gross Commission Income to $38 million (up from $29 million in 2018).
That figure was bolstered by 2419 sales (up from 667 sales the year prior) and $2.5 billion worth of property sold across the combined group for FY 2019 (up from $400 million in FY 2018).
The report also noted the financial results included only six months of operations from Top Level Real Estate, which The Agency acquired in mid-January this year.
“The integration of Top Level into the combined group has been highly successful,” Mr Niardone said. “And we are confident further revenue growth will be achieved and cost synergies realised over the coming financial year.”
Meanwhile, The Agency also flagged further potential areas for cost savings in FY 2020, including $2.8 million worth of savings as the group integrates its east and west coast operations.
They noted already $1.3 million of annualised benefits have been realised.
“We realise the need to implement measures to control our costs in the current environment and have identified and are already implementing these cost savings,” Mr Niardone said.
In terms of financial performance, the company reported an EBITDA (earnings before interest, tax, depreciation and amortisation) loss of $4.2 million in FY 2019 (up from $3.1 million in FY 2018).
However, they noted this included $1.3 million in one-off non-operational costs primarily associated with the Top Level transaction.
“Excluding these would have seen the company record a nominalised EBITDA loss of approximately $2.9 million, or a 10 per cent reduction on the previous year.”
Cash at the end of the financial year was $2.6 million compared to $1.02 million in FY 2018.
“Coupled with the $5.6 million capital raising and $5.8 million dent to equity conversion which will significantly strengthen our balance sheet, and signs of green shoots in key markets, I anticipate the company will continue to achieve strong operations and financial growth moving forward,” Mr Niardone said.