McGrath shares bounce on brighter outlook
McGrath shares have jumped nearly seven per cent after the beleaguered real estate agency reported promising signs it was on a path to better times.
The company reported a net loss for the second year in a row back in August after it was stung by sliding property prices, retreating rents and a slump in the number of homes for sale
But on Thursday it said first-half earnings should in the range of $1.0 million and $1.5 million - prior to the adoption of new leasing standards - representing a median earnings increase of about $3.8 million on a year ago.
The company said improved property prices were an encouraging sign but it did note that listing numbers had continued to decline.
"McGrath expects a return to growth in the FY20 year notwithstanding the continued challenging market conditions," chief executive Geoff Lucas told shareholders at the company's annual general meeting.
McGrath said for the four weeks to October 27 both Sydney and Melbourne listings were down by 6.6 per cent and 15.8 per cent respectively compared to a year ago.
"While recent above reserve prices, increased auction clearance rates and buyer engagement levels have all improved sentiment, all of which might improve listing levels, we do not see evidence yet of any sustainable improvement," Mr Lucas said.
Nonetheless, McGrath shares rose 6.9 per cent to 31 cents at 1430 AEDT.
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