McGrath return to net profitability, reinstate dividend

The ASX-listed real estate agency McGrath have announced they have returned to net profitability, with new chief executive Eddie Law citing a relatively strong residential real estate market over the past four months.

"It appears consumers are re-assessing their home needs and aspirations in a post-COVID world," Law, who was speaking at his first AGM having taken the top job in August, said.

"Both transaction volumes and average selling prices across our network have exceed the prior year in each of the first four months of FY21."

McGrath's FY20 saw an underlying EBITDA of $3.7 million, a $10.1 million turnaround from FY19 which has seen them return to net profitability.

"We ended 30 June with a strong balance sheet with zero debt and a $17.3 million cash balance, an increase of $7 million from 30 June 2019," Law added.

McGrath are forecasting underlying EBITDA to be in a range of $6 million to $6.5 million for the first half of FY21.

Law however was cautious amid the optimism of the general improved outlook, saying there is still undercertainty in the first half of 2021.

"With the scheduled end of the JobKeeper and deferred mortgage programs still yet to be determined, along with other macro factors impacting consumer confidence, there is still material uncertainty as to whether the momentum evidenced in the first half of FY21 will be maintained in the second half results."

McGrath shares were up over eight per cent on the positive news to 46c a share.