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McGrath released a trading update to investors that laid the recovery of the business in the hands of the skills and quality of the agents.
An update provided to McGrath investors said that it anticipates that it will achieve the earnings guidance that it provided to the market on 12 March 2018.
McGrath CEO Geoff Lucas said that the past year was a challenge but was bolstered by the agents in the business.
“We are very proud of our dedicated team that have contributed to McGrath’s domination in the recently published annual Real Estate Business Top 100 Agents ranking, with 27 of the top 100 agents in Australia [coming from McGrath],” Mr Lucas said.
“Importantly, 37 per cent of the female agents in this top 100 ranking work with our company.”
Mr Lucas added that while a tight residential market had impacted the business, there had been a lift in momentum.
“While reduced sales volumes during FY18 impacted the performance of the business, I am pleased with the recent initiatives and the positive rebuilding of the business we have seen,” the CEO said.
Based on the unaudited financial accounts for FY18, underlying earnings before interest, tax, depreciation and amortisation (EBITDA) for FY18 is expected to be approximately $5 million for McGrath.
Following roughly $4 million of one-off cash costs, the reported EBITDA is expected to be around $1 million for the last financial year.
The company also commenced its balance sheet review and expects to recognise an additional impairment charge of approximately $35 million against the company-owned sales segment.
This amount is in addition to the impairment announced at the half-year results.
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