Revenue doubles at The Agency Group

The Agency Group Australia has increased its revenue by 48 per cent to $41.9 million and recorded strong growth, despite being impacted by the COVID-19 downturn.

The real estate and financial services group told the ASX the increase in revenue was primarily due to a 26 per cent increase in combined gross commission income to $47.9 million, with $2.9 billion worth of property sold across the group, up from $2.5 billion in 2019.

Its property management services continued to grow, with The Agency reporting a record of 4,838 properties under management at June 30, up 12 per cent on 2019 and generating around $9 million in revenue.

The group was appointed to manage Aspen Group’s recently-acquired $20 million Perth rental portfolio in November last year.

This year was the first the group had posted positive earnings before tax, delivering $2.6 million.

The group’s net assets have increased from $2.5 million in 2019 to $11.5 million in 2020.

However, the group incurred a net loss of $9.1 million, $6 million of which was due to depreciation and amortisation and $5.3 million was impairment of goodwill.

In a statement, The Agency said the board had taken a conservative view on the review of its goodwill on historical acquisitions in light of market uncertainty as a result of COVID-19.

Due to COVID-19 restrictions on open houses and in-person auctions, the company temporarily reduced working hours for all staff in line with reduced workloads as well as a small number of redundancies.

The Agency Group managing director Paul Niardone said he was proud of all The Agency had achieved in the 2020 financial year.

“To report a maiden EBITDA profit, positive cashflow, a strong gain in revenue and other key metrics is a major achievement and testament to the hard work and dedication of our agents and our staff, especially when considering the impact of COVID-19,” Mr Niardone told the ASX.

“Our quick response to COVID-19 has placed us in an enviable position, allowing us to rebound strongly in key markets.

“We have generated a strong sales pipeline which has flown through into the first quarter FY21 with a record 446 listings for July 2020.”

The Agency Group, formerly known as Ausnet Real Estate and Financial Services, listed on the ASX in 2016 after a reverse takeover of Namibian Copper.

It changed its name to The Agency Group in 2017.

At 12pm AWST, shares in the company were steady at 2.8 cents each.