Douglas Elliman Inc. · NYSE:DOUG
Douglas Elliman — Investor Presentation (May 2022)
25 slides from Douglas Elliman's investor presentation, May 2022
Slide 1: Investor Presentation
Investor Presentation June 2021 / Confidential May 2022
Slide 2: Disclaimer
Disclaimer This document and any related oral presentation does not constitute an offer or invitation to subscribe for, purchase or otherwise acquire any securities or other instruments of Douglas Elliman Inc. (“Douglas Elliman Inc.”, “DOUG” or “the Company”) or its subsidiaries and nothing containe
Slide 3: Investment Highlights
Investment Highlights Unique Investment Opportunity in Tech-Enabled Residential Real Estate Brokerage with Comprehensive Suite of Real Estate Solutions, Industry-leading Brand Name and Talented Team of Employees and Agents Favorable dynamics in the U.S. residential real estate market Experienced man
Slide 4: Douglas Elliman at a Glance
Douglas Elliman at a Glance ⚫ Founded in 1911 as a pioneer in the real estate industry that has continued to challenge the status quo through innovation and high- quality service provided by best-in-class real estate agents ⚫ Leading brand associated with service, luxury and forward thinking operati
Slide 5: Douglas Elliman's Geographical Footprint
Douglas Elliman’s Geographical Footprint One ~6,700 affiliated agents across approximately 110 U.S. offices #6 Nationally of the Largest in New York Alliance with Knight Frank provides an international network of approximately 370 offices across, 50 countries and 17,000 agents Massachusetts GTV: $40
Slide 6: Highly Attractive Dynamics in the U.S. Residential Real Estate Market
Highly Attractive Dynamics in the U.S. Residential Real Estate Market Consistent Growth in New and Existing Home Sales and Increasing Home Ownership Rates(1) (thousands) Existing Home Sales New Home Sales 6,506 6,898 6,742 6,906 6,022 828 771 808 849 688 5,334 5,678 6,127 5,934 6,057 2019 2020 2021
Slide 7: Highly Attractive Dynamics in the U.S. Residential Real Estate Market (Cont.)
Highly Attractive Dynamics in the U.S. Residential Real Estate Market (Cont.) Millennials Represent Largest Homebuying Generation in the Housing Market(1) (% of home buyers) 37% 24% 18% 14% 5% 2% Gen Z Millennials Gen X Younger Baby Boomers Older Baby Boomers Silent Generation (1955 - 1964) (1946 -
Slide 8: Comprehensive Solution Provides for Multiple Revenue Streams
Comprehensive Solution Provides for Multiple Revenue Streams • Advising sellers: Assist in pricing a property and preparing it for sale, advertising, showing to Residential prospective buyers and negotiating terms of sale and closing transaction Real Estate • Advising buyers: Locating / showing prop
Slide 9: Industry-leading Brand Name with a Strong Presence in U.S. Luxury Markets
Industry-leading Brand Name with a Strong Presence in U.S. Luxury Markets Leading Presence in Large Luxury Markets ✓ Markets are primarily international finance and technology hubs that are densely populated and offer inventory at premium prices ✓ Large national presence augmented by alliance with K
Slide 10: Cutting-edge Technology Supportive of Agent Recruitment, Retention and Productivity
Cutting-edge Technology Supportive of Agent Recruitment, Retention and Productivity • Premier, customizable, mobile-friendly and cloud-based agent portal that integrates all agent resources in one user-friendly suite • Fully mobile-friendly, allowing agents to manage their business anytime, anywhere
Slide 11: MyDouglas | Complete Set of Capabilities
MyDouglas | Complete Set of Capabilities Capabilities Solutions Team Management Agent Social Media • Learning Management System • MyDouglas Team Views • Team Deal Management Agent Brand Management VideoBolt – One-Click Video Creation/Virtual Tours • Elliman.com • Custom Property Websites Listing Man
Slide 12: Open Architecture Technology Infrastructure
Open Architecture Technology Infrastructure Open Architecture Technology Infrastructure, Kept State-of-the-art Through Strategic Investments in Early Stage PropTech Companies with Technology Purpose-built for the Real Estate Industry Key Benefits of Our Technology Strategy Benefits to Agents Benefit
Slide 13: Strong Platform for Continued Growth
Strong Platform for Continued Growth Market Expansion Opportunity • Further grow leadership position in NY while entering and expanding into adjoining markets where the Douglas Elliman brand has strong awareness and brand equity, including Florida, California, Colorado Salt Lake City and Texas Sacra
Slide 14: Strong Platform for Continued Growth (Cont.)
Strong Platform for Continued Growth (Cont.) • In 2021, 86% of revenue was attributable to agents with more than 3 years of tenure • In 2019, 2020 and 2021, average retained agent was ~2.5x to ~3.0x more productive than departed agents Retention(1) Continue to 91% 90% 94% 94% Recruit Best-in- class
Slide 15: Strong Platform for Continued Growth (Cont.)
Strong Platform for Continued Growth (Cont.) • Grow New Valley Ventures and create a portfolio of PropTech companies that, through our investment and commercial relationships, have access to our operating businesses/distribution, as well as our know-how and Invest in experience, to grow their own bu
Slide 16: Douglas Elliman Financial Overview
DOUGLAS ELLIMAN FINANCIAL OVERVIEW
Slide 17: Attractive Financial Profile
Attractive Financial Profile Disciplined expense Strong performance management drives across KPIs significant operating leverage Healthy margins and limited Capital Expenditures Strong balance sheet with requirements drive cash approximately $195 flow conversion, million of net cash(1) supporting fu
Slide 18: Financial Summary
Financial Summary ($ millions) Revenue Adjusted EBITDA attributed to Douglas Elliman Inc. (1) Adj. EBITDA Adj. EBITDA Margin $1,353.1 $1,389.3 8.2% 7.7% $784.1 $774.0 $110.7 $107.1 2.9% 0.7% $22.1 $5.2 2019 2020 2021 LTM 3/31/22 2019 2020 2021 LTM 3/31/22 Adjusted EBITDA for Real Estate Brokerage Se
Slide 19: Business Mix and Growth
Business Mix and Growth LTM 3/31/22 Revenue Gross Transaction Volume ($ billions) $52.8 $23.6M $51.2 $37.3M $85.8M $28.1 $28.8 $29.1 $24.6 $25.4 $22.4 $1.389B $18.2 $1,242.6M 2014 2015 2016 2017 2018 2019 2020 2021 LTM 3/31/22 Commissions and Other Brokerage Income – Existing Home Sales Commissions
Slide 20: Investment Highlights
Investment Highlights Unique Investment Opportunity in Tech-Enabled Residential Real Estate Brokerage with Comprehensive Suite of Real Estate Solutions, Industry-leading Brand Name and Talented Team of Employees and Agents Favorable dynamics in the U.S. residential real estate market Experienced man
Slide 21: Appendix
APPENDIX
Slide 22: Combined Consolidated Statement of Operations
Combined Consolidated Statement of Operations ($ thousands, except per share amounts) Year Ended Three Months Ended LTM 12/31/2019 12/31/2020 12/31/2021 3/31/2021 3/31/2022 3/31/2022 Revenues: Commissions and other brokerage income $742,414 $733,751 $1,292,416 $259,100 $295,109 $1,328,425 Property m
Slide 23: Consolidated Balance Sheet
Consolidated Balance Sheet ($ thousands) December 31, March 31, 2021 2022 ASSETS: Current assets: Cash and cash equivalents $211,623 $203,669 Receivables 32,488 27,404 Agent receivables, net 9,192 14,597 Restricted cash and cash equivalents 15,336 7,861 Other current assets 12,166 22,728 Total curre
Slide 24: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation ($ thousands) Year Ended Three Months Ended LTM 12/31/2019 12/31/2020 12/31/2021 3/31/2021 3/31/2022 3/31/2022 Net income (loss) $8,459 ($46,372) $98,838 $13,965 $6,510 $ 91,383 Interest income, net (600) (190) (83) (47) (39) (75) Income tax expense 354 44 2,133 281 2,
Slide 25: Adjusted Operating Expenses Reconciliation
Adjusted Operating Expenses Reconciliation ($ thousands) Year Ended Year Ended Three Months Ended LTM 12/31/2019 12/31/2021 3/31/2021 3/31/2022 3/31/2022 Total Operating Expenses(1) $787,588 $1,251,040 $258,548 $301,021 $1,293,513 Items excluded from total expenses to determine Real Estate Brokerage