McGrath sets sights on becoming Australia’s leading real estate agency

McGrath Estate Agents, under the leadership of CEO John McGrath, has unveiled ambitious plans to increase its market share in the Australian real estate industry within the next five years. Following the announcement of the company’s half-year results for the financial year 2024, McGrath spoke to Real Estate Business about navigating through a “tough” real estate market over the past six months and tackling the issue of stock shortages.

Despite challenging macro market conditions, the ASX-listed company reported a 42% increase in operating profit. This achievement was described by McGrath as “a good sign,” emphasizing that the company’s primary goal is always to increase market share. “The market can be declining, but if our market share is growing, we can still keep growing the business,” McGrath explained.

Currently, McGrath’s market share is slightly below 3% nationally, a figure McGrath finds “a little bit unfair” given the company’s focus on specific regions. In areas where McGrath operates, market share varies between approximately 2.5% and 5%, with highs of up to 84% in certain locales. McGrath emphasized the importance of concentrating on controllable factors. “We try and avoid any excuses like shortage of listings or lack of confidence because people are still going to buy and sell to a degree. So, we just need to make sure our market share keeps growing,” he stated.

As McGrath aims to extend its operations beyond the eastern seaboard, the CEO expressed a clear ambition to surpass Ray White and ascend to the top position in the Australian real estate market, targeting a market share of 12.5% to 15%. “We’re very focused on doing that over the next five years and we’re very excited,” McGrath shared, expressing confidence in the company’s platform, team, and brand.

The company’s results for the half-year were characterized as “strong,” revealing an underlying EBIT of $4.2 million, underlying EBITDA of $4.8 million, and a statutory net profit after tax of $7.5 million. This represented a significant $5.7 million improvement in statutory net profit compared to the corresponding period, with underlying EBITDA experiencing a 42% increase.

Reflecting on these outcomes, McGrath remarked, “We were delighted with the result,” attributing the success to the “focus of our management team, outstanding agents, and our strong brand.” Following these results, McGrath Estate Agents announced a 1.5 cent fully franked interim dividend per share and a 1.5 cent per share fully franked special dividend.