Q1 2019 Revenue Up 153% to Record $157 Million
BELLINGHAM, WASH. — May 9, 2019 — eXp World Holdings, Inc. (NASDAQ: EXPI), the holding company for eXp Realty and eXp World Technologies, today announced financial results for the first quarter ended March 31, 2019.
First-Quarter 2019 Financial Summary
- Revenue increased 153% in the first quarter of 2019 to $157 million, compared to $62 million in the first quarter of 2018.
- Gross profit grew 132% to $14.5 million in the first quarter of 2019, compared to $6.3 million in the first quarter of 2018. Gross profit is calculated as revenues less commission and other agent-related costs.
- Net loss was $6.3 million, or $(0.10) per diluted share in the first quarter of 2019, compared to a net loss of $10.7 million, or $(0.19) per diluted share, in the first quarter of 2018.
- Adjusted EBITDA (a non-GAAP financial measure) was $(773,348) in the first quarter of 2019, compared to $(901,763) in the first quarter of 2018.
- Cash flow from operations increased 39% to $6.7 million in the first quarter of 2019, compared to $4.8 million in the first quarter of 2018.
Focused on Agent eXperience
In the first quarter of 2019, eXp Realty continued its focus and obsession on providing an outstanding experience for its agents. The company uses Net Promoter Score to measure and make sure they are delivering and improving the agent experience. eXp Realty earned a 68 agent Net Promoter Score, which measures agent satisfaction, in the first quarter. The score is a reflection of improvements made based on agent feedback, the tech provided to make sure agents are safe, and the programs offered to help new and experienced agents thrive at eXp Realty and in their business. These things helped to fuel the company’s agent NPS, and solid agent growth and revenue in the first quarter.
- Implemented Safety Check for Workplace by Facebook to better confirm, among its agents, brokers and staff in multiple countries, who is safe or might need assistance in the event of a natural disaster or crisis.
- Introduced ShowMeNow, an on-demand home tour mobile app, to Austin, Texas and Nashville, Tennessee in the first quarter, with additional markets slated to launch in 2019.
“As the most agent-centric real estate brokerage on the planet, eXp kicked off 2019 with new and expanded agent programs and tech initiatives to ensure every agent and broker at eXp Realty has the tools and training to establish or grow their business,” said eXp World Holdings CEO, Chairman and Founder Glenn Sanford. “This has helped us to continue our rapid growth with our ongoing commitment to creating a seamless, tech-enabled, and incredibly rewarding agent experience that is unparalleled within the industry. We established an NPS benchmark across numerous areas of the company to ensure an outstanding agent experience and recognize where we still need to do work.”
Recognized for Agent Production
eXp Realty agents are among the top producers in the country. Real estate industry reports that came out in the first quarter honored eXp Realty with top rankings for its transaction sides, transaction volume and agent count.
- 2018 REAL Trends 500 named eXp Realty No. 4 for closed transaction sides and No. 5 for closed sales volume in 2018.
- 2018 Swanepoel Mega 1000 named eXp Realty the No. 3 top brokerage by agent count at the end of 2018, No. 4 for transaction sides and No. 6 for sales volume in 2018.
Sustainable Equity Plan
Implemented in the first quarter, eXp World Holdings’ Sustainable Equity Plan continues to share equity with eXp Realty agents and brokers while also maintaining the longevity of the company. The company already is starting to recognize the long-term benefits for agents and company profitability.
The company also authorized a stock repurchase program to offset equity issuances. In the first quarter of the year and the program, the company repurchased more than 357,000 shares. This allows the company to offset a portion of the equity issuances provided to agents at eXp Realty.
“We believe agents and brokers deserve the benefits of being a shareholder and income based on the level of their contribution — no matter where life takes them,” said Sanford. “We are happy to report that we are starting to see the benefits of the plan for both agents and the company reflected in revenue this quarter. This goes back to our commitment to offer agents long-term financial opportunities and ensure the longevity of eXp Realty.”
Our acquisition of VirBELA in the fourth quarter of 2018 resulted in immediate improvements in the eXp Realty agent experience and continues to show promise with other current and potential customers.
“We believe that our VirBELA platform will prove to be an attractive virtual alternative to physical offices for companies with a distributed employee base, allowing employees to efficiently collaborate as if they shared an office,” said Sanford.
First-Quarter 2019 Operating and Business Highlights
- The number of agents and brokers on the eXp Realty platform increased by 93% to 17,929 at the end of the first quarter of 2019, compared to 9,290 at the end of the first quarter of 2018.
- Residential transaction sides closed in the first quarter of 2019 was 22,307, an increase of 136% compared to 9,473 during the first quarter of 2018.
- Residential transaction volume closed in the first quarter of 2019 was $5.8 billion, an increase of 149%, compared to $2.3 billion during the first quarter of 2018.
- VirBELA continued development work and put resources in place to allow for growth across a variety of industries.
- Founder Glenn Sanford was named a 2019 RISMedia Real Estate Newsmaker and 2019 REAL Trends Game Changer, and ranked as one of the most powerful and influential leaders in residential real estate by the 2019 Swanepoel Power 200.
- eXp World Holdings hired General Counsel James Bramble, and Dave Conord and Stacey Onnen took on the expanded leadership roles of co-presidents at eXp Realty.
Use of Non-GAAP Financial Measures
To provide investors with additional information regarding our financial results, this press release includes references to Adjusted EBITDA, a non-GAAP financial measure. We view Adjusted EBITDA as an operating performance measure and, as such, we believe that the GAAP financial measure most directly comparable to it is net income (loss). We define Adjusted EBITDA as net income excluding interest, income taxes, depreciation, amortization, and stock-based compensation except for the agent equity program. We believe that Adjusted EBITDA provides us an important measure of operating performance and enhances comparability while providing investors with useful insight into the underlying trends of the business. Our use of Adjusted EBITDA has limitations as an analytical tool, and this measure should not be considered in isolation or as a substitute for an analysis of our results as reported under GAAP, as the excluded items may have significant effects on our operating results and financial condition. Additionally, our measure of Adjusted EBITDA may differ from other companies’ measure of Adjusted EBITDA. When evaluating our performance, Adjusted EBITDA should be considered with other financial performance measures, including various cash flow metrics, net income and other GAAP results. In the future, we may disclose different non-GAAP financial measures in order to help our investors and others more meaningfully evaluate and compare our future results of operations to our previously reported results of operations.
Safe Harbor Statement
The statements contained herein may include statements of future expectations and other forward-looking statements that are based on management’s current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Such forward-looking statements speak only as of the date hereof, and the company undertakes no obligation to revise or update them. These statements include, but are not limited to, statements about the company’s expansion, revenue growth, operating results, financial performance and net income changes. Such statements are not guarantees of future performance. Important factors that may cause actual results to differ materially and adversely from those expressed in forward-looking statements include changes in business or other market conditions; the difficulty of keeping expense growth at modest levels while increasing revenues; and other risks detailed from time to time in the company’s Securities and Exchange Commission filings, including but not limited to the most recently filed Annual Report on Form 10-K.
About eXp World Holdings
eXp World Holdings, Inc. (NASDAQ: EXPI) houses eXp Realty and eXp World Technologies, LLC, which operates the VirBELA platform and eXp World Marketplace.
eXp Realty, The Real Estate Cloud Brokerage™, is the largest residential real estate brokerage by geography in North America. It is one of the fastest growing real estate brokerage firms in North America with more than 18,000 agents across 50 U.S. states, the District of Columbia and three Canadian provinces. As a subsidiary of a publicly traded company, eXp Realty uniquely offers real estate professionals within its ranks opportunities to earn eXp World Holdings stock for production and contributions to overall company growth.
VirBELA offers a modern, cloud-based environment focused on education and team development with clients in various industries from government to retail. VirBELA developed eXp Realty’s current cloud campus, which provides 24/7 access to collaborative tools, training and socialization for the company’s agents and staff.
For more information, please visit the company’s website at www.expworldholdings.com.
Reported Consolidated Results
|EXP WORLD HOLDINGS, INC.|
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|March 31, 2019||December 31, 2018|
|Cash and cash equivalents||$||20,771,971||$||20,538,057|
|Accounts receivable, net of allowance $297,567 and $484,441, respectively||29,693,641||17,428,091|
|Prepaids and other assets||1,792,756||1,857,988|
|TOTAL CURRENT ASSETS||56,452,170||42,326,727|
|Fixed Assets, net||3,153,814||2,739,525|
|Right-of-use assets – operating||291,689||–|
|Intangible assets, net||2,458,678||2,531,669|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Current portion of long-term payable||974,659||974,659|
|Current portion of lease obligation – operating||79,538||–|
|TOTAL CURRENT LIABILITIES||37,313,013||24,212,062|
|Long term payable||1,716,853||1,654,337|
|Long term lease obligation – operating||212,214||–|
|Common Stock, $0.00001 par value 220,000,000 shares authorized;|
|61,499,843 issued and 61,142,091 outstanding at March 31, 2019,|
|60,609,102 issued and 60,609,102 outstanding at December 31, 2018||612||606|
|Additional paid-in capital||102,066,398||90,755,616|
|Treasury stock, at cost: 357,652 shares held at March 31, 2019||(3,647,076||)|
|Accumulated other comprehensive income||3,533||(11,327||)|
|TOTAL STOCKHOLDERS’ EQUITY||31,362,378||29,979,629|
|TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY||$||70,604,458||$||55,846,028|
|EXP WORLD HOLDINGS, INC.|
|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS|
|Three Month’s Ended March 31,|
|Commission and other agent-related costs||142,542,405||55,701,516|
|General and administrative||19,700,772||16,281,113|
|Sales and marketing||888,850||645,797|
|Total operating expenses||163,132,027||72,628,426|
|Net loss from operations||(6,098,395||)||(10,665,895||)|
|Other income and (expenses)|
|Other income (expense)||(80,976||)||–|
|Interest income (expense)||46,245||–|
|Total other income and (expenses)||(34,731||)||–|
|Loss before income tax expense||(6,133,126||)||(10,665,895||)|
|Income tax expense||(162,697||)||(30,450||)|
|Net loss attributable to common shareholders||$||(6,295,823||)||$||(10,696,345||)|
|Net loss per share attributable to common shareholders|
|Basic from continuing operations||$||(0.10||)||$||(0.19||)|
|Diluted from continuing operations||$||(0.10||)||$||(0.19||)|
|Weighted average shares outstanding|
|The accompanying notes are an integral part of these consolidated financial statements.|
|US-GAAP Net Income (Loss) to Adjusted EBITDA Reconciliation|
|Adjusted EBITDA Reconciliation, QTD||Mar-18||Jun-18||Sep-18||Dec-18||Mar-19|
|Net Income / (Loss)||$||(10,696,345||)||$||(1,886,658||)||$||(4,628,171||)||$||(5,219,182||)||$||(6,295,823||)|
|Income Tax Expense||30,450||14,270||7,455||25,625||162,697|
|Depreciation & Amortization||183,321||147,558||240,031||323,079||440,279|
Connect with eXp Realty and eXp World Holdings:
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Media Relations Contact:
Vice president of marketing and communications, eXp Realty
360.419.5285 ext. 116
Investor Relations Contact:
Managing director, MZ Group – MZ North America