- EBITDA expected to be above $16.5M, up from $3.7M last year
- Strong markets and unique business model credited as factors
- Half year reports saw results four times the previous period
McGrath Limited (ASX: MEA) recently updated the market on strong growth figures, with a substantial increase expected by end of the financial year.
Earlier in February, the company announced that its earnings before interest, taxes, depreciation, and amortization (EBITDA) was more than four times the previous corresponding period, up to $6.6 million from $1.6 million.
The company went on to announce forecasts for the current financial year. EBITDA is expected to be between $16.5 million and $17.5 million, representing an approximately 350% increase over the previous corresponding period, which had yielded earnings of $3.7 million.
The business model was credited as a factor in the healthy prospects, founder and executive director John McGrath said: “Our unique business model of combining the strong annuity style income derived from property management and franchise operations alongside our company-owned sales offices is delivering strong results.”
Excellent market conditions also made a significant positive impact, CEO of McGrath, Eddie Law affirmed:
“The strength in the residential property market continued throughout the third quarter. The combination of improving business and consumer sentiment, record low interest rates and lower stock levels in the market, has driven strong price growth in recent months.”
Eddie Law, CEO of McGrath
The confidence in McGrath’s books also follows news earlier this month when the company that it had made a capital injection into spin-off Oxygen Home Loans, the home loans business that was originally created by McGrath back in 2003. It has since built a loan book of around $3.2 billion.