#1THE AGENCY (ASX: AU1) Investor Presentation for the FY2022 Full Year Results 30 June 2022#2KEY TAKEAWAYS UNDERLYING EBITDA1 $3.85M (FY21: $3.06M) → +26% Gross Value of Properties Sold $5.9Bn (FY21: $4.8Bn) → +23% Revenues from Ordinary Activities $72.7M (FY21: $58.4M) – → +24% No. of Properties Sold 5,709 (FY21: 4,964) → +15% GCI² $102.5M (FY21: $80.7M) → +27% No of Agents 393 (FY21: 308) → +28% 1. Underlying EBITDA adjusted for the impact of AASB16 and Government Incentives received in the prior period 2. Gross Commission Income ("GCI") is the fees the vendor pays for the sale of a property. FY22 Investor Presentation 2#3INCREASE IN AGENT NUMBERS UNDERPINNING GCI GROWTH Net increase of 85 Agents from 30 June 2021 15% Increase in No. of Properties Sold 27% Increase in Gross Commission Income ^ Gross Commission Income ("GCI") is the fees the vendor pays for the sale of a property. 28% Growth 12% 393 Growth 308 276 27% Growth 71% Growth $102.5m 15% Growth 21% Growth 58% Growth 67% Growth $80.7m $5.9bn 5,709 4,964 $4.8bn 3,147 $2.9bn $47.9m No of Agents No of Properties Sold Gross Sales Volume Gross Commission Income ($M)^ FY20 FY21 FY22 FY22 Investor Presentation 3#4186 83 ١٨ ЛЛ AA 30 \ ^ ^ ^ ^ ^ АЛЛ ΑΛΛ 10 147 BE A growing brand now with presence in 6 states and territories АЛЛА 20 23 11 Since 30 June 2021, The Agency has invested in new geographical markets of Manly NSW, Sunshine Coast, Gold Coast and Toowoomba in Queensland and Canberra in the ACT. Post financial year end in July 2022, The Agency has entered its sixth state being Tasmania through its acquisition of Bushby Property Group. FY22 Investor Presentation#5Bushby Property Group Acquisition Bushby Property Group, to be renamed The Agency – Team Bushby consists of nine sales agents within the 32 staff who have sold over $125m in residential property over the past 12 months and circa 1,300 properties under management, operating out of its large 'hub' office in Launceston. THE AGENCY Team Bushby Consideration of c. $5M subject to a number of earn out provisions based on performance and growth Funded via combination of bank debt and existing cash reserves Extension of Macquarie Bank facility until July 2025 ADSHEL The new team for Tassie. Extension of Convertible Note issued by Peters Investments until Jan 2026 (subject to shareholder approval) Settlement occurred 22 July 2022 Tasmania's Bushby Property Group joins one of Australia's fastest growing real estate agencies, The Agency.#6Why agents are choosing The Agency B NO FRANCHISE CONSTRAINTS OR COSTLY OUTLAYS. Unlike most other real estate businesses, there are no franchise rules or restrictions at The Agency. Our agents can operate their business wherever they choose, under our national flagship brand, The Agency. MORE SUPPORT SERVICES. We've taken away the overheads and administrative burden so agents can focus on the high dollar value activities that will propel their business forward. At The Agency, we're not a traditional franchise structure. Instead, we've removed the 'middle layer' and created a more responsive, efficient and effective model for our agents. This means our agents are better rewarded and their clients receive a superior service. This differentiated business model has a number of benefits, leading agents to choose The Agency: MORE FINANCIALLY BENEFICIAL. - The Agency reduces expenditure on fixed costs such as set premises and office locations - which allows us to pay the agent higher commission splits in a sustainable way. It's a more financially beneficial model for both parties. MORE RESPONSIVE. The Agency has strategic partnerships with suppliers and various tech platforms that make selling real estate more efficient and streamlined, at a lower cost; enabling the agent to quickly and easily get their product to market. FY22 Investor Presentation 6#70 FRE HOSE REEL Reimagining the office 0000 In line with The Agency Group's innovative approach to disrupting the status quo, The Agency's newly opened satellite office in Western Suburbs of Perth completements the existing Hub office in the Perth CBD. In an innovative approach, the office also doubles as an Art Gallery that facilitates community engagement while building brand awareness. Artwork displayed, which will be constantly rotated, is currently showcasing works by students from Curtin University. Initial feedback has seen increased foot traffic and brand awareness compared to a typical office and the Gallery is generating positive engagement with the community. FY22 Investor Presentation 7#8Recruitment Month JAN 22 FEB 22 MAR 22 APR 22 MAY 22 JUN 22 JAN FEB MAR How agent recruitment assists the agency profitability Across the past 12 month period, there has been an increase of 85 Agents. The profitability of FY22 recruits is yet to fully flow through to The Agency operating profit (as visualised below). APR MAY JUN JUL AUG SEP OCT NOV End of FY22 DEC JAN <! Not Yet Joined Not yet contributing profit Contributing operating profit Month of the Year Agents recruited in existing, established, geographical areas have a quicker path to profitability. It takes approx. 3-4 months for a new agent in an existing area to contribute to profitability. It takes approx. 6 months for agents in a new area to contribute to profitability, as it takes slightly longer to establish themselves. Before entering a new geographical area, any initial investment is carefully considered by Management against sufficient scale benefits, to ensure entry into a new market is profitable over the medium term. FY22 Investor Presentation 8#9Financial Highlights PY22 Investor Presentation#10Positive jaws delivering EBITDA growth 24% Increase in Revenues 430 Decrease in Cost of Doing Business basis point 26% Increase in EBITDA UNDERLYING¹ STATUTORY Revenue Cost of Doing Business² FY22 $72.66m FY21 $58.38m Change 24% FY22 $72.66m FY21 Change $58.38m 24% 30.3% EBITDA $3.85m 34.6% $3.06m -430 bps 26% n.a. $5.69m n.a. n.a. Net Profit/(Loss) After tax ($0.84m) ($1.68m) n.m. $1.59m $6.37m ($1.85m) -11% n.m. 1. FY22 Underlying adjusted for the impact of AASB16 Leasing Standard and Impairment Reversal. FY21 Underlying adjusted for the impact of AASB16, Gain on Sale and Government Incentives received in the prior period. Refer to Appendix for detailed calculations 2. Operating Expenses as a percentage of revenue n.a. Not Applicable n.m. Not Meaningful FY22 Investor Presentation 10#11Double digit growth in key metrics as the business reaches scale delivering profitable growth and increasing cash at bank 26% 26% Growth 70% Growth 24% Underlying EBITDA Growth Growth 39% Growth $4.6m FY22 Operational Cash Flow (Pre AASB16) $8.2m Cash at Bank as at 30 June 2022 $3.9m $3.1m $72.7m $58.4m $41.9m -$0.4m -$1.7m 61% Growth $4.6m 86% Growth $8.2m $2.7m $2.7m $5.1m Total Revenue Underlying EBITDA* Net Cash Received from operating Activites^ Cash at Bank FY20 ■FY21 ■FY22 * Underlying EBITDA P(re AASB16 Leasing Standards Adjustment and Government Grants in relevant period) ^ Pre AASB16 Leasing Standards Adjustment FY22 Investor Presentation 11#12Reducing cost of doing business as revenue grows UNDERLYING¹ $72.7m FY20 FY21 FY22 GCI (Fees the vendor pays for the sale of a property) $47.9m $80.7m $102.5m $58.4m Non Payroll Agent GCI² ($20.4m) ($35.4m) ($41.8m) Commissions Revenue $27.5m $45.3m $60.7m Other Revenue $14.2m $13.1m $12.0m $41.7m Revenue² $41.7m $58.4m $72.7m Operating Expenses ($20.0m) ($20.2m) ($22.0m) Cost of Doing Business 48.0% 34.6% 30.3% $22.0m $20.0m $20.2m FY20 FY21 Revenue —Operating Expenses FY222 Notwithstanding we are a growth business, we are targeting further decreases in cost of doing business ratio as we further achieve economies of scale. Additional Fixed costs are incurred when we enter a new geographical area which could include rental expenses, marketing expenses and state management expenses. We are careful to ensure that any growth from entry into a new geographical market is profitable growth, and ensure that this additional fixed cost is only incurred once we have sufficient scale in that geographical area. 1. FY22 Underlying adjusted for the impact of AASB16 Leasing Standard. FY21 and FY20 Underlying adjusted for the impact of AASB16, Gain on Sale and Government Incentives received in the prior period. 2. According to accounting standards, recognition of revenue is dependent on the engagement mechanism of the Agent. A sale by a payroll agent will result as revenue equal to GCI, with an agent commission expense in Cost of Sales. A sale by a non payroll agent, revenue is equal to The Agency share pf GCI. There is no cost of sale expense for a non payroll agent. As a general rule, Western Australia agents are predominantly Payroll agents, while East Coast agents are predominantly non payroll agents. FY22 Investor Presentation 12#13Strengthened balance sheet underpinned by net cash Net Cash $5m Net (Debt)/Cash² Position Net Debt $0m ($5m) ($10m) ($15m) STATUTORY $3.2m KEY INDICATOR 30 June 2022 30 June 2021 Change Cash at Bank $8.2m $5.1m +61.2% Statutory Net Assets $16.4m $14.1m +16.0% Value of Assets not $12.7m $11.2m +13.4% on balance sheet Estimate Net Assets¹ $29.1m $25.3m +15.0% Dec-19 Jun-20 Dec-20 Borrowings of $5.0m is below $8.2m Cash at Bank resulting in a Net Cash2 position of $3.2m, a significant turnaround from prior year positions and represents the strength of the balance sheet repair. 1 This is a non A-IFRS measure 2. Excludes Convertible note held as Financial Liabilities Jun-21 Dec-21 Jun-22 The value attached to internally generated Property Management and Mortgage book is not recorded in the balance sheet. Management valuation of the Property Management portfolio is calculated on a blended valuation multiple of 3.65x on Q4 FY22 Annualised Property Management fees and 2.25x Net Trail Income relating to the Mortgage Book (combined value of $22.8m). Only $10.1m of this value is held on the Balance Sheet as an intangible asset, leaving $12.7m value off balance sheet. Adjusted for this off balance sheet assets, Estimated Net Assets has increased 15.0% to $29.1m FY22 Investor Presentation 13#14Industry Highlights FY22 Investor Presentation 14#1557% OF AUSTRALIAN HOUSEHOLD WEALTH IS HELD IN RESIDENTIAL HOUSING WITH $7.8 BILLION ANNUAL ADDRESSABLE COMMISSION MARKET Residential Real Estate Australian Superannuation $ $3.4T Australian Listed Stocks L Commercial Real Estate $1.1T $2.6T $9.95T 584,917 Sales in FY22 $521.2Bn Gross Value of Sales in FY22 Total Annual Addressable Market* (GCI) $7.8 Bn Source: CoreLogic, RBA, APRA, ASX * Assessed at 1.50% Average Commission Rate of Gross Sales Volume of $521.2Bn. FY22 Investor Presentation 15#16Decade Average Houses National dwelling approvals Following the expiry of Monthly house and unit approvals, National 16,000 14,000 12,000 10,000 8,000 6,000 HomeBuilder, house approvals have adjusted downwards to 4,000 mush سر мильт decade average. Record high price differences between Units and 2,000 Houses in key markets is resulting MAY 92 MAY 97 MAY 02 MAY 07 MAY 12 MAY 17 MAY 22 in a recovery in the Unit market due to affordability, with new Unit approvals trending towards their decade average. Source: CoreLogic Units Houses Australia 197k approvals in FY22 Houses 124k approvals in FY22 Units 73k approvals in FY22 Decade Average Units FY22 Investor Presentation 16#17FY22 Sales Volumes Across the country there were variances in sales volume movements compared to FY21. Market volumes had growth in Capital Cities markets, with slightly lower volumes in Regional markets after a very strong FY21. Importantly, The Agency FY22 Sales Transaction increase of 15.0% outperformed the national growth of 3.2%. Source: CoreLogic Change in sales volumes, twelve months to June 2022 Sydney -9.4% Melbourne Brisbane Adelaide Perth 10.7% 14.5% 16.9% 17.6% Hobart ] 0.2% Canberra -5.6% Australia Combined Regionals Combined Capitals 3.2% -1.2% 6.0% Recent months of sales volumes are modelled estimates, and are subject to revision FY22 Investor Presentation 17#18FY22 Rental Market Rents grew strongly across FY22 in all markets, as demand for rental properties outstripped supply. The rental growth has assisted in increasing yields for investors which have increased to be 3.33% nationally at 30 June 2022, up from a recent low of 3.21% in January 2022. Source: CoreLogic Australia 9.5% Canberra Hobart FY22 change in rental rates Perth 6.7% Adelaide Brisbane 9.3% 8.6% Melbourne 7.5% Sydney Combined Regionals 10.8% 10.6% 9.7% 12.1% Combined Capitals 9.1% FY22 Investor Presentation 18#19Investor participation Investor participation at 34.5% of lending has recovered to be in line with the decade average of new lending volume. Portion of new lending for investment housing (excluding refinance)^ 50% 45% 40% 35% NSW is the state with the highest investor participation with 38.7% of lending to investors. 30% 25% Investors as a % of housing finance commitments by state (May '22)^ ACT TAS 32.8% 32.6% 27.1% WA SA ဟ် 34.8% 34.5% QLD 30.8% 34.0% VIC 31.5% NSW 38.7% 20% National MAY MAY MAY MAY MAY MAY MAY MAY MAY 06 08 10 12 14 16 18 20 22 CoreLogic Source: CoreLogic, * ATO 34.5% 3.25m # of Investment Properties across Australia* FY22 Investor Presentation 19#20Strategic Objectives and Outlook FY22 Investor Presentation 20 20#21STRATEGIC OBJECTIVES $ 8 888 Further expansion of geographical regions across Australia in a disciplined capital and operating expenses approach. Continued growth in agent numbers across the company. Enhancement of adjacency offerings to our agents and customers to increase the share of wallet. Further development and rollout of a Multi Brand Strategy. Training initiatives to ensure our Agents are positioned to capitalise on changing market conditions. Leveraging technology and cost of doing business efficiencies to enhance agent experience and ensure a solid scalable platform for growth. FY22 Investor Presentation 21 24#22OUTLOOK $ A Until there is certainty around interest rates, we expect transaction volumes to remain volatile at a national level. States with lower median price points are expected to outperform higher median priced states in terms of transaction volume movements. We have revised our CY22 National price growth to be -4% to -8%. For the first 7 months for the year, the reduction was -1.0%, meaning we expect more rapid declines in the 2nd half of the calendar year movement. Vendors look to experienced agents who have a track record in changing market conditions. Market Consolidation as smaller independents and franchisees look to access operating efficiencies. Consumer sentiment to rebound as the quantum of interest rate movements reduce. Upon the tipping point of rates reaching their terminal value for this cycle, we believe this will lead to a recovery in transaction volumes in some states. FY22 Investor Presentation 22 22#23Appendix FY22 Investor Presentation 23 3#24PROFIT & LOSS STATEMENT UNDERLYING¹ STATUTORY FY22 FY21 Change Revenue $72.66m $58.04m 24% FY22 $72.66m FY21 Change $58.38m 24% Cost of Sales ($47.43m) ($35.65m) 33% ($47.43m) ($35.65m) 33% Gross Profit $25.22m $22.39m 13% $25.22m $22.73m 13% Other Income Operating Expenses EBITDA $0.53m $0.63m -16% $0.61m $1.29m -53% ($21.90m) ($19.96m) 10% ($20.15m) ($17.65m) 14% $3.85m $3.06m 26% $5.69m $6.37m -11% Depreciation and Amortisation ($3.85m) ($3.94m) 2% ($5.44m) ($5.47m) -1% Share-based payments expense ($0.68m) ($0.22m) n.m ($0.68m) ($0.22m) n.m Impairment recovery/(expense) $- $- n.a $0.40m ($0.40m) n.m Fair Value Gain on Financial n.a $- $0.12m $- n.a Asset Profit on Sale of Asset $- n.a $0.00m $0.20m n.m EBIT ($0.68m) ($1.10m) n.m $0.10m $0.49m -73% Net Finance income/(expense) ($0.52m) ($1.30m) 60% ($0.78m) ($1.99m) n.m Embedded derivative non cash $- $- n.a $1.14m ($2.24m) n.m financing gain/(cost) Net Profit/(Loss) Before Tax ($1.20m) ($2.40m) 50% $0.46m ($3.75m) n.m Income Tax Benefit Net Profit/(Loss) After tax $0.36m ($0.84m) $0.72m -50% $1.12m ($1.68m) n.m. $1.59m $1.89m ($1.86m) -19% n.m. 1. FY22 Underlying adjusted for the impact of AASB16 Leasing Standard and Impairment Reversal. FY21 Underlying adjusted for the impact of AASB16, Gain on Sale and Government Incentives received in the prior period. n.a - Not Applicable FY22 Investor Presentation 24 n.m - Not Meaningful Note - may not add through due to rounding differences#25BALANCE SHEET STATUTORY Cash at bank Other Current Assets Non Current Assets Total Assets Total current liabilities Total Non current liabilities 30 June 2022 $8.26m 30 June 2021 Change $5.10m 61% $11.60m $8.68m 34% $27.84m $31.49m -12% $47.65m $47.65m 5% ($28.25m) ($15.59m) 81% ($3.00m) ($15.54m) -81% Total Liabilities ($32.82m) ($31.12m) 0% Net Assets $16.40m $14.14m 16% Assets not on balance sheet¹ $12.68m $11.19m 13% Estimated Net Assets² $29.08m $25.32m 15% 1: Property Management Portfolio Management Valuation calculated on a blended valuation multiple of 3.65x on Q2 FY22 Annualised Property Management fees and 2.25x Net Trial Income relating to the Mortgage Book (combined value of $22.8m). Only $10.1m of this value is held on the Balance Sheet as an intangible asset. 2: This is a non A-IFRS measure Note - may not add through due to rounding differences FY22 Investor Presentation 25 25#26CASHFLOW STATEMENT FY22 (Underlying)* (Pre AASB16)^ $3.85m FY22 (Statutory) (Post AASB16) $5.69m FY21 (Statutory) (Post AASB16) $6.37m EBITDA Change in net working capital Net interest Paid Net Cashflow from Operating Activities Purchase of property, plant and equipment Purchase of intangibles Deposit for bank guarantees Net Loans to other entities $1.03m $1.34m ($0.23m) ($0.24m) ($0.43m) ($0.98m) $4.64m $6.60m $4.64m ($0.97m) ($0.97m) ($0.24m) ($0.32m) ($0.32m) $- ($0.01m) ($0.01m) $- ($0.71m) ($0.71m) ($0.22m) Net cash received on disposal of asset group $0.49m $0.49m $2.62m Net cash (used in) / received from investing activities ($1.52m) ($1.52m) $2.16m Payment of principal portion of lease liabilities Proceeds from borrowings $- Repayment of borrowings Proceeds from exercise of options $- Share issue costs ÉÀ ÉÀ ÉÀ ÉÀ É $- ($1.96m) ($1.92m) $- $5.00m $- ($7.84m) $- $- $0.39m ($0.06m) Net cash used in financing activities ($1.96m) ($4.42m) Net increase in cash and cash equivalents held $3.12m $3.12m $2.37m Cash and cash equivalents at the beginning of the year $5.10m $5.10m $2.72m Cash and cash equivalents at the end of the year $8.22m $8.22m $5.10m Underlying EBITDA adjusted for the impact of AASB16 ^ This is a non A-IFRS measure Note - may not add through due to rounding differences 26 FY22 Investor Presentation 26#27Geoff Lucas Managing Director & CEO [email protected] LinkedIn: www.linkedin.com/in/geoff-lucas Λ David Tasker Chapter One Advisors [email protected] FY22 Investor Presentation 27 27#28DISCLAIMER NOT AN OFFER This presentation is for information purposes only. This presentation does not comprise a prospectus, product disclosure statement or other offering document under Australian law (and will not be lodged with the Australian Securities and Investments Commission) or any other law. SUMMARY INFORMATION This presentation does not purport to be all inclusive or to contain all information about the Company or any of the assets, current or future, of the Company. This presentation contains summary information about the Company and its activities which is current as at the date of this presentation. The information in this presentation is of a general nature and does not purport to contain all the information which a prospective investor may require in evaluating a possible investment in the Company. The Company does not undertake to provide any additional or updated information whether as a result of new information, future events or results or otherwise. FORWARD LOOKING STATEMENTS Certain statements contained in this presentation, including information as to the future financial or operating performance of the Company and its projects, are forward looking statements. Such forward looking statements: are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Company, are inherently subject to significant technical, business, economic, competitive, political and social uncertainties and contingencies; involve known and unknown risks and uncertainties that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in such forward looking statements; and may may include, among other things, statements regarding estimates and assumptions in respect of prices, costs, results and capital expenditure, and are or may be based on assumptions and estimates related to future technical, economic, market, political, social and other conditions. The Company disclaims any intent or obligation to publicly update any forward looking statements, whether as a result of new information, future events or results or otherwise. The words "believe", "expect", "anticipate", "indicate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate”, “may”, “will”, "schedule" and similar expressions identify forward looking statements. All forward looking statements contained in this Presentation are qualified by the foregoing cautionary statements. Recipients are cautioned that forward looking statements are not guarantees of future performance and accordingly recipients are cautioned not to put undue reliance on forward looking statements due to the inherent uncertainty therein. FY22 Investor Presentation 28#29Empty