Agency Group Australia Ltd · ASX:AU1
Agency Group Australia — H1 FY2022 Earnings Presentation
26 slides from Agency Group Australia's earnings presentation, Feb 24, 2022
Slide 1: Investor Presentation for the Half Year End Results
(ASX: AU1) Investor Presentation for the Half Year End Results 31 December 2021
Slide 2: Key Takeaways
KEY TAKEAWAYS UNDERLYING EBITDA1 Revenues from Ordinary Activities GCI2 $2.14M $35.6M $52.9M (1HFY21: $1.60M) → +33% (1HFY21: $29.4M) → +21% (1HFY21: $38.1M) → +39% Gross Value of Exchanges No. of Exchanges Properties Under Management $3.1Bn 2,910 3,551 (1HFY21: $2.2Bn) → +41% (1HFY21: 2,407) → +21%
Slide 3: Strong Growth Across Key Business Indicators
STRONG GROWTH ACROSS KEY BUSINESS INDICATORS 39% Growth $52.9m 39% 16% Growth Increase in Gross Commission Income $38.1m 41% Growth 21% Growth 345 $3.1Bn 2,910 298 Increase of 278 $24.9m 2,407 47 $2.2Bn 1,591 Agents from 31 December 2020 $1.5Bn Gross Commission Income Value of Properties Sold No of
Slide 4: A growing brand now with presence in 5 states and territories
A growing brand now Sunshine Coast with presence in 5 states Toowoomba Brisbane Gold Coast and territories Coffs Harbour Central Hunter Valley Coast Newcastle Central Perth West NSW Sydney Illawarra ACT Since 30 June The Agency has invested in new geographical markets of Manly NSW, Sunshine Melbourn
Slide 5: Why Agents Are Choosing The Agency
WHY AGENTS ARE CHOOSING THE AGENCY The Agency’s business model is to directly engage with Selling Agents. This is a change to the industry norm where the most common arrangement is a franchisor/franchisee arrangement, with the franchisee employing the Agents. This differentiated business model has a
Slide 6: How Agent Recruitment Assists The Agency Profitability
HOW AGENT RECRUITMENT ASSISTS THE AGENCY PROFITABILITY Across the past 12 month period, there has been an increase of 47 Agents. The profitability of H1 FY22 recruits is yet to fully flow through to The Agency operating profit (as visualised below). Agents who are recruited in existing established g
Slide 7: Financial Highlights
Financial Highlights 1H FY22 Investor Presentation 7
Slide 8: Profitable Growth Reducing Cost of Doing Business
PROFITABLE GROWTH REDUCING COST OF DOING BUSINESS 21% 86 basis point $0.4M Increase in Revenues decrease in Cost of Doing Increase in Statutory Net Profit Business after tax UNDERLYING1 STATUTORY 1H FY22 1H FY21 Change 1H FY22 1H FY21 Change Revenue $35.56m $29.45m 21% $35.56m $29.45m 21% Cost of Do
Slide 9: Strengthened Balance Sheet Underpinned by Net Cash
STRENGTHENED BALANCE SHEET UNDERPINNED BY NET CASH Net (Debt) / Cash2 Position STATUTORY Net Cash $5m KEY INDICATOR 31 Dec 2021 30 June 2021 Change $1.3m Cash at Bank $6.3m $5.1m -22.9% $- Statutory Net Assets $15.8m $14.1m +11.5% ($5m) Value of Assets not on $11.0m $11.2m -7.1% balance sheet ($10m)
Slide 10: Strong Operating Cash Generation of $2.3M in the Period
STRONG OPERATING CASH GENERATION OF $2.3M IN THE PERIOD Strong Operating Cash Flow has funded $1.2m of Investment activities including costs for an office refurbishment and short term working capital advances. $2.3m Operating Cash Generation 1: This is a non A-IFRS measure 1H FY22 Investor Presentat
Slide 11: Industry Highlights
Industry Highlights 1H FY22 Investor Presentation 11
Slide 12: 56% of Australian Household Wealth in Residential Housing; $7.4 Billion Addressable Market
56% of Australian Household Wealth is held in Residential Housing with $7.4 Billion annual addressable market Residential $9.6T Real Estate $3.4T Australian Superannuation $2.9T Australian Listed Stocks $1.0T Commercial Real Estate 653,009 $494.6Bn $7.4 Bn Sales in 2021 Gross Value of Sales in 2021
Slide 13: National House Approvals
NATIONAL HOUSE APPROVALS Following the expiry of HomeBuilder, house approvals have adjusted downwards but still remain above the decade average. Record high price differences between Units and Houses in key markets is resulting in a recovery 12,000 in the Unit market due to affordability, with new U
Slide 14: Rolling Seven Day Count of CMA Activity Exceeds Prior Year
ROLLING SEVEN DAY COUNT OF CMA ACTIVITY EXCEEDS PRIOR YEAR CMA’s are a real estate industry acronym for Comparative Market Analysis – an RP Data tool that shows comparative recent sales to a property. CMA’s are an indicator of likely future listing volumes. The start of 2022 has seen strong uplift o
Slide 15: Investor Participation
INVESTOR PARTICIPATION Portion of new lending for investment housing (excluding refinance) Investor participation remains well below the 5 year average at 31.5% of new lending volume. While investor lending is still growing 45% at 2.4% in December, strong owner occupier lending of 5.3% in December m
Slide 16: Loans Greater Than a 90% Loan to Value Ratio
LOANS GREATER THAN A 90% LOAN TO VALUE RATIO (LVR) 14.1% 13.1% 12.7% Over recent quarters, the % of 12.4% 12.0% 12.0% 12.0% loans originated with an LVR 11.7% 11.6% greater than or equal to 90% has 10.8% reduced for both investors and owner occupiers. This shows some 9.7% restraint by financial inst
Slide 17: Summary of Capital City 2022 Forecasts
SUMMARY OF CAPITAL CITY 2022 FORECASTS 2022 is expected to be a more moderate year for price growth across key capital markets. There is consensus across the Big 4 10% 10% banks that Brisbane will be the strongest market for price growth. 5% 5% 0% 0% CBA ANZ WESTPAC NAB MELBOURNE SYDNEY BRISBANE PER
Slide 18: Outlook
Outlook 1H FY22 Investor Presentation 18
Slide 19: Outlook
OUTLOOK Transaction volumes Focus on further Continued growth in Optimisation of expected to remain geographical regions Agent numbers across operational systems to strong, despite expected and penetration of the country. ensure a solid platform subdued price growth in suburbs to grow to service fut
Slide 20: Appendix
Appendix 1H FY22 Investor Presentation 20
Slide 21: Profit & Loss Statement
PROFIT & LOSS STATEMENT UNDERLYING1 STATUTORY 1H FY22 1H FY21 Change 1H FY22 1H FY21 Change Revenue $35.56m $29.45m 21% $35.56m $29.45m 21% Other Income $0.21m $0.27m -22% $0.21m $0.59m -64% Cost of Sales ($22.70m) ($18.81m) 21% ($22.70m) ($18.81m) 21% Gross Profit $13.06m $10.91m 20% $13.06m $11.23
Slide 22: Balance Sheet
BALANCE SHEET STATUTORY 31 Dec 2021 30 June 2021 Change Cash at bank $6.26m $5.10m 23% Other Current Assets $12.49m $8.68m 44% Non Current Assets $29.83m $31.49m -5% Total Assets $48.59m $45.26m 7% Total current liabillities ($18.85m) ($15.59m) 21% Total Non current liabilities ($13.97m) ($15.54m) -
Slide 23: Cashflow Statement
CASHFLOW STATEMENT 1H FY22 1H FY22 1H FY21 (Underlying)* (Statutory) (Statutory) (Pre AASB16)^ (Post AASB16) (Post AASB16) EBITDA $2.14m $3.05m $3.68m Change in net working capital $0.58m $0.66m ($0.23m) Net interest Paid ($0.31m) ($0.31m) ($0.88m) Net Cashflow from Operating Activities $2.41m $3.40
Slide 24: Geoff Lucas, David Tasker
Geoff Lucas Managing Director & CEO geofflucas@theagency.com.au LinkedIn: www.linkedin.com/in/geoff-lucas David Tasker Chapter One Advisors dtasker@chapteroneadvisors.com.au 1H FY22 Investor Presentation 24
Slide 25: Disclaimer
DISCLAIMER NOT AN OFFER This presentation is for information purposes only. This political and social uncertainties and contingencies; presentation does not comprise a prospectus, product involve known and unknown risks and uncertainties disclosure statement or other offering document under that cou
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