The Agency Group denies it's scrambling for cash

The Agency Group denies it's scrambling for cash
The Agency Group denies it's scrambling for cash

The Agency Group has denied a Fairfax Media report alleging it had delayed acquisitions "as it scrambles for cash."

The burgeoning agency has told its shareholder it had delayed the acquisitions of two key real estate businesses.

The West Australian company was due to settle on its $950,000 acquisition of another WA estate agency Sell Lease Property last week.

The Agency was also expected last week to exercise an option to acquire real estate group Top Level, which operates as The Agency East Coast under a licence agreement.

Instead it extended a trading halt in place since Monday until this Tuesday.

The Agency Group acquisition of the ServTech Global Limited subsidiaries Sell Lease Property Pty Ltd, Complete Settlements Pty Ltd and Value Finance Pty Ltd had been delayed due to a "small number of conditions" needed to be satisfied prior to settlement. 

The acquisition of Top Level is reportedly delayed due to procedural issues relating to ASX compliance.

The AFR advised acquisition of the two businesses "would transform the cash-strapped start-up from a cash-flow-negative operation to one that is cash-flow positive."

The Agency released a quarterly update of its financial position indicating the first quarter of 2018 could see a negative cash flow position of $3.1 million.

The Agency raised $1.92 million through the issue of new shares. The acquisition of Top Level will be through the issue of around 366 million shares in The Agency which requires shareholder approval.

Previously called Ausnet Financial Services, The Agency is backed by mortgage broker Finsure, co-founded by mortgage broker John Kolenda.

An updated AFR report noted its report on the company had the words "as it scrambles for cash" removed from its online version.

In its half year report lodge with the ASX, covering the six month period to 31 December 2017, The Agency Group confirmed it had completed 322 settlements across their wholly-owned operations, valued at $190.5 million.

The number of listings grew to 492 listings during the period, a 30 percent increase on June HY2017.

Gross commissions for December HY2017 came in at $3.76 million, a 45 percent rise on June HY2017. 

“The six months to 31st December 2017 has been a pivotal time in the short history of the company as we continue our significant growth trajectory in both west coast and east coast property markets," said The Agency Group Australia managing director, Paul Niardone, adding that "the company’s unique business model works and will continue to provide significant revenues going forward.”

Top Level, which boasts some of Australia’s leading property professionals, is operating under licence to The Agency Group.

Tags: 
Cash Flow The Agency

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