Douglas Elliman Inc. · NYSE:DOUG
Douglas Elliman — Q2 2022 Earnings Presentation
25 slides from Douglas Elliman's earnings presentation, Aug 5, 2022
Slide 1: Investor Presentation August 2022
June 2021 / Confidential Investor Presentation August 2022
Slide 2: Disclaimer
2 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 contai
Slide 3: Investment Highlights
3 Investment Highlights Cutting-edge property technology supportive of agent recruitment, retention and productivity Strong platform for continued growth Favorable dynamics in the U.S. residential real estate marketExperienced management team with substantial real estate expertise and a track record
Slide 4: Company overview: founded in 1911
4 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 operating in markets that are pri
Slide 5: Douglas Elliman's Geographical Footprint
5 Douglas Elliman’s Geographical Footprint ~6,700 affiliated agents across approximately 110 U.S. offices Alliance with Knight Frank provides an international network of approximately 370 offices across, 50 countries and 17,000 agents #6 Nationally One of the Largest in New York California(3) Colora
Slide 6: Highly Attractive Dynamics in the U.S. Residential Real Estate Market
6 1) Source: Mortgage Bankers Association – MBA Mortgage Finance Forecast May 2022. 2) Source: Board of Governors of the Federal Reserve System (U.S.) – Households; Owners' Equity in Real Estate, October 2021. 3) Source: National Association of Realtors – Profile of International Transactions in U.S
Slide 7: Highly Attractive Dynamics in the U.S. Residential Real Estate Market (Cont.)
7 4.9% 9.1% 16.9% 5.1% 3.7% 2019 2020 2021 2022E 2023E 1) Source: National Association of Realtors – 2022 Home Buyers and Sellers Generational Trends Report. 2) Source: National Association of Realtors – Q1 2022 Economic Outlook. Represents existing home price appreciation. Highly Attractive Dynamic
Slide 8: Comprehensive Solution Provides for Multiple Revenue Streams
8 Comprehensive Solution Provides for Multiple Revenue Streams • DEDM offers expertise in sales, leasing and marketing for new developments throughout key markets in the United States and internationally New Sales and Development Marketing Platform • Advising sellers: Assist in pricing a property an
Slide 9: Industry-leading Brand Name with a Strong Presence in U.S. Luxury Markets
9 LTM 6/30/22 Average(4): $1,608.7 Industry-leading Brand Name with a Strong Presence in U.S. Luxury Markets $1,580.0 $1,128.4 $657.3 $555.1 $351.3 Douglas Elliman Compass Realogy Redfin eXp Realty Highest Transaction Values in the Industry Average Selling Price (2021)(3) ($ thousands) Leading Prese
Slide 10: Cutting-edge Technology Supportive of Agent Recruitment, Retention and Productivity
10 Cutting-edge Technology Supportive of Agent Recruitment, Retention and Productivity Powered by industry leading technology capabilities developed by innovative PropTech leaders and start-ups • Premier, customizable, mobile-friendly and cloud-based agent portal that integrates all agent resources
Slide 11: MyDouglas | Complete Set of Capabilities
11 * New Valley Ventures PropTech Investee Company MyDouglas | Complete Set of Capabilities Capabilities Solutions Artificial Intelligence (“AI”) and Predictive Analytics Team Management Agent Social Media • Learning Management System • MyDouglas Team Views • Team Deal Management Agent Brand Managem
Slide 12: Open Architecture Technology Infrastructure
12 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 Recent PropTech Investm
Slide 13: Strong Platform for Continued Growth
13 • 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 and Texas • Recent entry into the Dallas, Austin, Jacksonville and Las Vegas markets • Discip
Slide 14: Strong Platform for Continued Growth (Cont.)
14 California Texas Florida Overview • Purchased Teles Properties in 2017 • Purchased interest in Texas brokerage in 2021 • High profile recruitment of teams in Naples, Vero Beach, Fort Lauderdale and Ponte Vedra Beach in 2021 and 2022 Benefits to Douglas Elliman • Ability to expand in southern Cali
Slide 15: Strong Platform for Continued Growth (Cont.)
15 $201.5 $183.0 $15.2 $19.7 $35.4 $46.6 $15.5 2019 LTM 6/30/22 Other OpEx Technology Activity Driven Operating Expenses Acquisitions Strong Platform for Continued Growth (Cont.) Invest in Compelling PropTech Opportunities that Facilitate Growth and Differentiation Relentlessly Pursue Operational Ef
Slide 16: Douglas Elliman Financial Overview
DOUGLAS ELLIMAN FINANCIAL OVERVIEW
Slide 17: Attractive Financial Profile
17 Attractive Financial Profile 1) As of June 30, 2022. Please see page 23, "Balance Sheet" of Douglas Elliman Inc. The Balance Sheet reports $202.1 million of cash and $6.4 million of Notes Payable and Other Obligations. Disciplined expense management drives significant operating leverage Strong pe
Slide 18: Financial Summary
18 Financial Summary 1) Adjusted EBITDA attributed to Douglas Elliman Inc. is a non-GAAP measure. Net income (loss) was $8.5 million, ($46.4) million, $98.8 million and $62.2 million for the years ended December 31, 2019, 2020 and 2021 and for the last twelve months ended June 30, 2022. Please refer
Slide 19: Business Mix and Growth
19 Business Mix and Growth $18.2 $22.4 $24.6 $25.4 $28.1 $28.8 $29.1 $51.2 $51.2 2014 2015 2016 2017 2018 2019 2020 2021 LTM 6/30/22 LTM 6/30/22 Revenue Gross Transaction Volume ($ billions) $1,221.7M $79.5M $37.4M $23.0M $1.361B Commissions and Other Brokerage Income – Existing Home Sales Commissio
Slide 20: Investment Highlights
20 Investment Highlights Cutting-edge property technology supportive of agent recruitment, retention and productivity Strong platform for continued growth Favorable dynamics in the U.S. residential real estate marketExperienced management team with substantial real estate expertise and a track recor
Slide 21: Appendix
APPENDIX
Slide 22: Combined Consolidated Statement of Operations
22 Combined Consolidated Statement of Operations Year Ended Six Months Ended LTM 12/31/2019 12/31/2020 12/31/2021 6/30/2021 6/30/2022 6/30/2022 Revenues: Commissions and other brokerage income $742,414 $733,751 $1,292,416 $635,133 $643,940 $1,301,223 Property management 35,461 35,115 37,345 19,169 1
Slide 23: Consolidated Balance Sheet
23 Consolidated Balance Sheet December 31, June 30, 2021 2022 ASSETS: Current assets: Cash and cash equivalents $211,623 $202,134 Receivables 32,488 31,161 Agent receivables, net 9,192 15,044 Restricted cash and cash equivalents 15,336 6,955 Other current assets 12,166 16,729 Total current assets $2
Slide 24: Adjusted EBITDA Reconciliation
24 1) Represents equity in (earnings) losses recognized from Douglas Elliman’s investment in an equity method investment that is accounted for under the equity method and is not consolidated in Douglas Elliman’s financial results. 2) Represents restructuring related to Douglas Elliman Realty, LLC’s
Slide 25: Adjusted Operating Expenses Reconciliation
25 Adjusted Operating Expenses Reconciliation Year Ended Year Ended Six Months Ended LTM 12/31/2019 12/31/2021 6/30/2021 6/30/2022 6/30/2022 Total Operating Expenses(1) $787,588 $1,251,040 $607,340 $650,752 $1,294,452 Items excluded from total expenses to determine Real Estate Brokerage Segment Adju