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ASX Release
2 August 2021
WEBINAR PRESENTATION
The Agency Group Australia (ASX:AU1) (“The Agency” or “the Company”) is pleased to provide the investor
webinar presentation relating to its recent June quarterly financial results ahead of the webinar today.
Details of the webinar are:
Date: Monday, 2 August 2021
Time: Time: 12pm (AEST)/ 10am AWST
Duration: ~45m
To access further details of the event and to register at no cost, please follow the below link:
https://us02web.zoom.us/webinar/register/WN_WZ_RLh9RSPmgoMbQiNThUQ
ENDS
Announcement authorised for release by Paul Niardone, Managing Director, The Agency Group Australia
Limited.
If you require further information, please contact:
Investors Media
The Agency Australia Ltd Chapter One Advisors
Paul Niardone David Tasker / Colin Jacoby
T: +61 08 9204 7955 T: +61 433 112 936 / +61 439 980 35
I N V E S T O R P R E S E N TAT I O N
August 2021
ASX:AU1
Direct exposure to national property
market with a re-set Balance Sheet and
a Team to deliver growth
DISCLAIMER
NOT AN OFFER • involve known and unknown risks and uncertainties that could
This presentation is for information purposes only. This cause actual events or results to differ materially from
presentation does not comprise a prospectus, product disclosure estimated or anticipated events or results reflected in such
statement or other offering document under Australian law (and forward looking statements; and
will not be lodged with the Australian Securities and Investments • may include, among other things, statements regarding
Commission) or any other law. estimates and assumptions in respect of prices, costs, results
SUMMARY INFORMATION and capital expenditure, and are or may be based on
assumptions and estimates related to future technical,
This presentation does not purport to be all inclusive or to contain economic, market, political, social and other conditions.
all information about the Company or any of the assets, current or
future, of the Company. This presentation contains summary The Company disclaims any intent or obligation to publicly update
information about the Company and its activities which is current any forward looking statements, whether as a result of new
as at the date of this presentation. The information in this information, future events or results or otherwise.
presentation is of a general nature and does not purport to contain The words “believe”, “expect”, “anticipate”, “indicate”,
all the information which a prospective investor may require in “contemplate”, “target”, “plan”, “intends”, “continue”, “budget”,
evaluating a possible investment in the Company. “estimate”, “may”, “will”, “schedule” and similar expressions
The Company does not undertake to provide any additional or identify forward looking statements.
updated information whether as a result of new information, All forward looking statements contained in this Presentation are
future events or results or otherwise. qualified by the foregoing cautionary statements. Recipients are
FORWARD LOOKING STATEMENTS cautioned that forward looking statements are not guarantees of
future performance and accordingly recipients are cautioned not
Certain statements contained in this presentation, including to put undue reliance on forward looking statements due to the
information as to the future financial or operating performance of inherent uncertainty therein.
the Company and its projects, are forward looking statements.
Such forward looking statements:
• are necessarily based upon a number of estimates and
assumptions that, while considered reasonable by the
Company, are inherently subject to significant technical,
business, economic, competitive, political and social
uncertainties and contingencies;
2
EXECUTIVE SUMMARY
A scalable, vertically-integrated real estate services company
Providing investors direct exposure to the growing $8.6T residential Australian property market1
Unique business Stabilised balance
Real estate services Achieved scale
model sheet
One of Australia’s largest Our agents are our clients Substantial growth since 2017 Long-term ~$8M funding
vertically-integrated real and are at the core of our & achieved a profitable scale: package strengthens
estate services companies business model • Maiden full-year financial position & balance
Continued agent recruitment Attracts high performing EBITDA of $0.7M in sheet
growth in existing / new real estate agents by FY2020 (pre AASB16) Assets (rent roll, mortgage
market sectors across two offering higher commissions • Current Full year book etc) valued at more
brands: The Agency + SLP and support than traditional EBITDA (pre AASB16) than $25M
franchises & independent expected to exceed
models $4m (unaudited)
Macroeconomic
External validation Vertical integration Scalable footprint
tailwinds
Group CEO Geoff Lucas joins Multiple cross-selling Continued strong outlook We are now focused on
mgmt. team - one of the most opportunities with a suite of with low interest rates & low using our scalable platform
highly regarded executive real estate services including unemployment to recruit high performing
teams in the Australian property sales, property agents with limited capital
property industry management, mortgage outlays or increases in
Supportive shareholder Peters financing and conveyancing corporate overheads.
Investments converts $3M in (settlement) Dual brands
Convertible Notes to emerge
a 30.2% shareholder
1. CoreLogic Market Report 3
GROWTH STORY
Built for scale with ability to materially grow agent numbers with
limited capex or increase in corporate overheads
New business model Achieve a profitable scale Bottom-line growth
We are disrupting the real-estate The Agency has now achieved a We are now focused on using our
sector by reducing structural layers profitable scale of operation, scalable platform to recruit high
and rewarding staff through a more established a stable balance sheet and performing agents with limited
compelling value proposition. attracted supportive investors. capital outlays or increases in
corporate overheads. Dual brand
strategy launching in 2022.
2016 2017 2018 2019 2020 2021+
Launched the Agency Major expansion with
Listed on the ASX on the east coast of Acquired Sell Lease Achieved maiden Achieved growth in
the acquisition of Top
Australia Property EBITDA of $0.7m EBITDA of at least $4m
Level Real Estate
4
COMPANY OVERVIEW
The Agency is a full-service, vertically-integrated real estate services company
Property sales Property management Commercial Sales & Leasing Ancillary services High-level support
Real estate agents conduct Property managers manage The Agency has launched a The Agency has several Superior support provided
property sales on behalf of residential and commercial new commercial division, cross-selling opportunities via:
property vendors, charging properties on behalf of headed by former Ray with the provision of
a commission of 1.6% to property owners, charging White executive Mark ancillary property services • Agent’s own admin
2.0% on the property value. a management fee of 6.0% Williams, which it intends including: team that assist
to 10.0% on the rental to grow in-line with throughout the whole
Our unique business model • Mortgage Financing process from listing to
income. demand it is experiencing
has an attractive value Mortgage financing settlement
on the east coast of services
proposition for agents We operate a unique agent Australia.
driving growth for the incentive model that • Centralised office and
• Conveyancing hubs
company and value for the encourages agent Settlement services
customers and agents. performance and generates • Marketing support
a stable, annuity-style (traditional and social)
Disrupting the Australian income for the company.
real estate brokerage • Industry leading
market with two The Agency Group’s training
differentiated offerings property management
under the brands The division operates under The • Cloud-based platform
Agency and Sell Lease Agency brand.
Instead, the traditional
Property (SLP).
models burden agents with
significant overhead costs
and administrative costs
which impacts on their
profits.
Premium, full service
offering
Value, SaaS support
offering
5
DIVISIONS: PROPERTY SALES
The dual offering of a premium brand and a value brand enables us to attract
sales agents across the spectrum of potential requirements and needs
Market positioning
High agent commissions High agent commissions The Agency has a unique, scalable business model,
low support strong support disrupting the real estate services industry by returning
value, previously given to franchisees and offices, to agents
Fin Techs and shareholders.
Operations
The Agency continues to expand its agent network by
recruiting the industry’s top talents and establishing market
Portion of commissions paid to agents
leadership based on property transaction volumes across
Australia.
Independent
50% operations
265 agents*
Traditional
franchises
PHYSICAL PRESENCE | NATIONAL PORTFOLIO OF OFFICES
The Agency is a premium brand with a full service offering that
provides agents with a progressive commission structure.
43 agents*
Low agent commissions Low agent commissions
VIRTUAL PRESENCE | PREDOMINANTLY ACROSS WA & QLD
low support strong support SLP is a value brand with a SaaS offering, boasting unique
technology that supports the entire administrative process for real
Level of support provided to agents estate transactions. Launching nationally in 2022
*As at 30th June 2021 6
DIVISIONS: PROPERTY SALES
Our agents are our clients and are at the core of our business model
Able to attract leading agents, without compromising on margin.
Attractive business model with agent first culture providing high levels of
support services
Franchisor Head office Principal
c. 10% c. 35%-15%1 c. 40%
Franchisee
c. 40%
Traditional Independent
Independent
franchise Operations
operations
Agent Agent Agent
c. 50% c. 65%-85%1 c. 60%
Note 1: Commission structure is tailored dependent on brand (The Agency or SLP) and agent performance.
7
DIVISIONS: PROPERTY SALES
Our business model attracts high performing real estate agents by offering
higher commissions and support than traditional & independent models
Traditional Independent
franchise operations
Franchisor Franchisee Agent Head office Agent Head office Agent Principal Agent
Revenue
Commission ~10% ~40% ~50% ~25% ~75% ~15% ~85% ~40% ~60%
Property mgmt. ✖ 100% ✖ ✔ Value option ✔ Value option 100% ✖
Mortgage Upfront & trail ✖ ✖ Upfront & trail Trail Upfront & trail Trail ✔ ✖
Expenses Costs borne by franchisee • Costs borne by head office • Costs borne by head office • Costs borne by agent
Legal & Compliance liability • Agent has an optional desk • Agent has $10,000 p.a. • Legal & Compliance
Financial liability fee of $6,000 p.a. member fee, $250 transaction liability
• No Legal or Financial liability fee, and IT platform fee of • Financial liability
$720 p.a.
• No Legal or Financial liability
• Provides levels of support:
• Business owner
Other coaching / training /
distractions
leadership
Levels of support
Brand support ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✖ ✖
Overhead support ✖ ✔ ✔ ✖ ✔ ✖ ✔ ✖ ✖
Add-on services ✖ ✔ ✖ ✔ ✔ ✔ ✔ ✖ ✖
Corporate benefits ✖ ✖ ✖ ✔ ✔ ✔ ✔ ✖ ✖
8
PERFORMANCE
FY2021: Key Takeaways
EBITDA1 expected to
exceed $4M
(FY20:$0.7M)
$80.7M $60.1M
GCI Revenues from Ordinary
(FY20: $47.9M) Activities
(FY20: $41.9M)
4,964 $4.84Bn
No. of Exchanges Gross Value of
(FY20: 3,147) Exchanges
(FY20: $2.94Bn)
>$25M
Rent Roll &
Mortgage Book2
1. EBITDA is unaudited and provided on a pre -adoption of AASB16 (but includes government incentives) 9
2. The Agency’s East Coast rent roll was valued at in excess of $23 million by JemmesonFisher in Sep'20
PERFORMANCE
Now that our business model has achieved a profitable scale, focus will shift
to quality agent recruitment for driving growth
Agents Sales
308 1,325
1,273 1,232
272 283 1,134
892
191 801 751
703
FY2018 FY2019 FY2020* FY2021* Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
FY20 FY20 FY20 FY20 FY21 FY21 FY21 FY21
Gross commission income ($ million) Gross value of sales ($ million)
22.7 1,470
21.4
20.0 1,259
1,153
16.6
959
14.2 886
12.1 748
10.7 10.9 633 674
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
FY20 FY20 FY20 FY20 FY21 FY21 FY21 FY21 FY20 FY20 FY20 FY20 FY21 FY21 FY21 FY21
* COVID + JobKeeper slowed movement of agents, as overall industry agent numbers also reduced 10
NATIONAL PRESENCE
A national footprint in key markets ready to scale
3 QLD
agents*
145 WA
agents*
138
NSW
agents*
22 VIC
agents*
* As at 30 June 21
Note 1: Based on value of listings sold in September 2019. Note 2: Based on number of listings sold in the Lower North Shore and Eastern Suburbs (NSW) area (September 2019) and the number of properties
currently listed (September 2019). Note 3: 20B Tivoli Avenue, Rose Bay, Sydney. Sold by Ben Collier. Note 4: 125 year old heritage-listed home, “Le Fanu”, Cottesloe, Perth. On market by Pamela Wilkinson. 11
Note 5: August 2019.
NATIONAL PRESENCE
Real Estate underpins Australia's wealth
$8.6
trillion
Residential
Real Estate
$8.6
trillion
$975 582,913
billion Total sales p.a.
Commercial real estate
Australian
Real Estate
10.6 $376
million billion $3.1
$2.8
Number of dwellings Gross value of sales p.a.
trillion
trillion
$1.9
trillion $975
Outstanding mortgage
debt billion
RESIDENTIAL REAL AUSTRALIAN AUSTRALAN LISTED COMMERCIAL REAL
ESTATE SUPERANNUATION STOCKS ESTATE
Data as at July 2021.
Source: CoreLogic, APRA, RBA, ABS, ASX 12
MACROECONOMIC TAILWINDS
The post COVID-19 Australian residential real estate market is achieving
record sales values and volumes
Change in dwelling values, twelve months to June 20211 Highlights1
Australia 13.5% Over the twelve-month period ending June 2021:
Combined regionals 17.7%
Australian dwelling values rose 13.5% in the 2020-21 financial
Combined capitals 12.4%
year, the highest annual growth rate since April 2004
Perth 9.8%
Sydney 15.0% In the three months to June, most capital cities saw the
AU1 markets
Melbourne 7.7% strongest dwelling value growth across the top 25% of values
Brisbane 13.2%
Adelaide 13.9% Sales volumes have risen 40.7% in the financial year compared
Hobart 19.6% with the previous year
Darwin 21.0%
Canberra 18.1%
Fresh listings nationally sat 22.4% above equivalent period last
year
Change in sales volume, twelve months to June 20211 Australian rent values increased 6.6%, which is the strongest
annual appreciation in rents since February 2009
Australia 40.7%
Combined regionals 51.9%
Combined capitals 34.2%
Perth 59.5%
Sydney 35.7%
Melbourne 22.1%
AU1 markets
Brisbane 44.0%
Adelaide 28.1%
Hobart -0.6%
Darwin 37.1%
Canberra 19.4%
Note 1: CoreLogic Monthly chart pack, July 2021.
13
FUNDING
Strong financial position & balance sheet
Total financing facilities at end of June AU1 borrowings & EBITDA ($ million)
2021 of $8.35 million3
EBITDA Borrowings
21.1
An extended $5 million Macquarie
12.2
Bank primary secured debt facility 8.35
$3.35 million Convertible Note to 0.7 4
private investment company -4.2
Peters Investments Pty Ltd4 FY 19 FY 20 FY21
AU1 borrowings continue to reduce as
EBITDA grows
($ million)
FY19 FY20 FY21
Borrowings1 21.1 12.2 8.35
Asset value (rent roll and loan book) Revenue 31.3 41.9 60.1
~$25m EBITDA2 (4.2) 0.7 4.05
Note 1: Borrowings have been adjusted to off set financial assets held against the borrowings. Note 2: EBITDA adjusted to exclude the impact of AASB16 and government incentives. Note 3: Refer to June Quarter
2021 Appendix 4C in ASX announcement dated 29 July 2021 Note 4 : Includes monthly interest which is capitalised. Note 5: Unaudited and expected to exceed $4M for FY21 14
THE TEAM
Experienced board & management team with a mix of real estate and
commercial expertise
Paul Niardone | Managing Director Arjan Van Ameyde| Chief Financial Officer
Previously Executive Director and founder of Professional Public Relations Arjan has over 25 years’ experience in senior finance roles in listed
(WA), the largest PR and communications firm in the State until he sold the companies and SME. He has previously founded short-term lending and
business to WPP. Experience in marketing and strategic planning for clients in insurance businesses and established the treasury for a listed
both Government and the private sector and over 15 years experience with multinational group. Most recently he was Chief Operating
public companies. Officer/Chief Financial Officer(Australia and UK) of ASX listed Ensurance
Limited (ASX: ENA).
Geoff Lucas| Group Chief Executive Officer Maria Carlino| Director of Property Management
Geoff Lucas is one of the most highly regarded executives in the Australian Over 27 years of real estate experience in key markets incl. Sydney,
property industry, with more than 25 years commercial experience and a Brisbane and the Gold Coast. Previous senior roles at RUN Property, Ray
distinguished track record of leadership in a number of corporate positions White and McGrath Real Estate where she was responsible for the
for an ASX-listed real estate group, as well as other major public companies. management and growth strategies of the rental portfolio and team
From 2008-2016 Geoff served as the Chief Operating Officer of McGrath Real across all company owned offices.
Estate (ASX: MEA), later serving as Chief Executive Officer of the company.
Matt Lahood| Chief Executive Officer – Real Estate Mark Williams | Chief Executive Officer – Commercial
More than 30 years in real estate sales; 2,000+ property sales worth over Mark Williams brings more than 30 years of real estate experience to
$2bn. Previously Director of Sales for McGrath Real Estate, responsible for his commercial role with The Agency. As the CEO and founder of Ray
market entry strategies and management of 22 company owned offices and White’s commercial division, he built a network of over 50
more than 250 people. commercial businesses across Australia, Asia and New Zealand.
Further to these achievements, he headed up the Ray White Group’s
Asia operations as Director of Greater China and Asia.
Andrew Jensen| Chief Operating Officer
Andrew, formerly CFO of Ray White, has extensive knowledge in the Board of directors
management of all aspects of finance with strong commercial, strategic,
M&A, and change management experience. He has financially led companies
Paul Niardone Managing director
engaged in various fields including real estate and ancillary services sectors
globally. Fellow of IPA and member of the AICD.
Matt Lahood Chief executive officer – Real estate
Adam Davey| Non-Executive Director Andrew Jensen Chief operating officer
Adam is Director, Private Clients and Institutional at Patersons Securities. His
expertise spans over 25 years and includes capital raising (both private and
Adam Davey Non-executive director
public), mergers and acquisitions, ASX listings, asset sales and purchases,
transaction due diligence and director duties.
15
CORPORATE SNAPSHOT
Corporate snapshot
Top shareholders Snapshot
6% - Daring
Investments
12%- ASX Code Shares O/S 428.6m
Directors & AU1:ASX Shares F/D2 570.7m
Mgmt. 30% - Peters
Investments
12% - Agents
Market capitalization Cash3
$23m (@ 5.4cps) $5.7m
40% - Other
Enterprise value Total Financing Facilities4
$25.5m (@ 5.4cps) $8.35m
Note 1: Trading history for the 12-month period ending 21 May 2021 (source: Thomson Reuters).
Note 2: Fully diluted shares outstanding inclusive of 333,333 unlisted options and conversion of the remaining balance of the Peters Investments Convertible Note ($3.26m as at 28 February 2021) at maturity. 16
Note 3: Cash as at 30 June 2021. Note 4: Refer to June Quarter 2021 Appendix 4C in ASX announcement dated 29 July 2021
Contact: Paul Niardone – Managing Director
E: pauln@theagencygroup.com.au
Ph: +61 08 9204 7955