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The Agency Group Australia flags 100% revenue growth ahead of east coast expansion

The loan book stands at circa $1.1 billion and is growing as a result of cross selling.
Picture of cash
The acquisition of Top Level would provide a springboard for east coast expansion

Agency Group Australia Ltd (ASX:AU1), a diversified property services group, has its sights set on delivering its third year of 100% revenue growth.

With management due to comment in the next 24 hours on an option to purchase agreement with east coast property group, Top Level Pty Ltd, the company’s outlook could improve further.

With regard to this development, the company entered into a trading halt on Monday.

Value of properties settled increases nearly 50%

Total value of properties settled in the six months to December 31, 2017 was $190 million, representing a 48% increase on the first half of calendar year 2017.

The total number of settlements was 322, generating gross commissions of circa $3.8 million, up 45% on the June half.

Cross selling opportunities are numerous

The Agency Group’s business model has been created to build the core asset, being a loan book currently at circa $1.1 billion, by cross referring clients between business units.

The Agency Group consists of a group of businesses which deliver a range of property financing and consulting services.

These include finance broking, real estate services, settlement services, property management, project marketing, insurance and financial planning.

Until recently, the group’s focus has been on the Western Australian market, but it has now laid the foundations for expansion into east coast markets.

Announcement pending on TopLevel acquisition

The Agency Group’s east coast operations are managed under licence with Top Level Pty Ltd.

Sustained growth in this business prompted management to enter into an option to purchase agreement.

The Agency Group entered into a trading halt on Monday pending an update on the option agreement, and management expects to make an announcement within the next 24 hours.

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