Leading high growth disruptive real estate firm The Agency Group has gained in Monday trading after delivering record revenue during a strong 12 months of organic growth.
The ASX-listed company reported a 75% year-on-year hike in revenue to $16.8 million as a result of gross commissions increased 67% year-on-year to $10.5 million.
Shares in the company gained 14.3% to 1.6c in morning trade on the news with 4.6 million shares changing hands by noon AEST.
The Agency witnessed significant growth in its sale agent numbers with 185 agents across The Agency (WA) and Sell Lease Property businesses, up from 50 at same time last year.
“The Agency, which has only been operating for two years, is in a sustained growth phase and therefore has made significant investment in expanding its business, even though organic growth via recruitment had played a major part we have invested in acquisitions, in technology and in our people and processes,” said The Agency Managing Director Paul Niardone.
“We have also used our cashflows to fund the establishment and staffing of two offices, one in Albert Park in Victoria and on the Gold Coast, which we believe will add revenue to our business in future financial years.
In a market where real estate companies are contracting or seeing little to no growth, we are achieving strong revenue growth across all business units in our Group.
“We are confident that this will continue via organic growth which is driven by recruitment due to the attractiveness of our model. This combined with strategic acquisitions and the planned merging of Top Level (The Agency East Coast) will continue to contribute future high growth,” he added.
Recently acquired Sell Lease Property delivered revenue of $2 million in the three full months post settlement of the acquisition in February 2018.
Despite being in an aggressive growth phase, where revenues are a key indicator of success, The Agency is continuing to focus on achieving being break-even in the coming 12 months.
The Combined Group recorded an operational loss of approx. $1.2m for FY18, against a statutory loss of $3,845,928 as a number of one off costs, totalling approx. $2.5m, were expensed this year.
These costs were largely associated with the acquisition of Beaufort Realty, Inglewood Estate Agency and Sell Lease Property, together with required establishment costs (i.e. rebranding, legal and technology costs, etc.).
The results also highlight the setup costs of expanding The Agency into key real estate markets outside of Western Australia, with the Consolidated Entity opening new high-profile offices on the Gold Coast and in Albert Park (Melbourne), where The Agency will benefit going forward from having a strong base for revenue growth in these key markets.
The Agency was awarded Top Office for Listings Sold and Top Office by Value Sold in Western Australia for 2018 at the annual REIWA.com Awards, held on Saturday 25th August 2018 in Perth.
It reported 667 sales worth over $400 million for the past 12 months, which was 200 more sales and over $50 million more property sold than second place. The Agency also finished fourth in project market sales for the year.
Sell Lease Property (SLP) would have come in second place for Listings Sold with 659 sales for the year, however were ineligible due to the change in ownership.