ACUMENTIS GROUP LIMITED — Earnings Release 2021

Jul 25, 2021

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26 July 2021

ASX Market Announcements Office ASX Limited 20 Bridge Street Sydney NSW 2000

Level 7, 283 Clarence Street Sydney NSW 2000 GPO Box 3359 Sydney NSW 2001

Telephone: 02 8823 6300 Facsimile: 02 8823 6399

By E-Lodgement

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Acumentis Group Limited (“Acumentis” or “the Company”) is pleased to release its Appendix 4E – Preliminary Final Results for the year ended 30 June 2021.

Highlights

• Revenue up 18% to $46.4M, with the final quarter delivering the strongest quarter of revenues since 2018 totalling $12.8M

• EBITDA of $5.0M or 10.6% of revenue

• Operating profit up 199% to $2.5M

• Continued growth expected for FY2022

• Company is well positioned to deliver on ongoing high demand for valuations and professional property services, driven by a buoyant property sector and the continued strategic expansion of the business

• Ongoing investment in IT and valuation management systems ensures that the Company remains an industry leader with its valuation management system ISO27001 and IRAP certified

• Acquisition of the business and assets of Saunders & Pitt (Tasmania) completed effective 1 April 2021

• • Acquisition of the remaining 57.8% of Acumentis (WA) Holdings Pty Ltd (the Company’s WA associate) which completed effective 1 July 2021

Acumentis delivers a strong result on the back of increased turnover whilst continuing to advance growth initiatives. The Company channelled investment into geographic and product expansion, its IT systems and growing its professional headcount to take advantage of ongoing growth and increases in market share.

With these initiatives well progressed, along with our valuation management system which we believe to be the only ISO27001 and IRAP certified valuation management system in Australia, Acumentis is well positioned for growth and to secure future opportunities the Company is currently pursuing.

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Summary of FY2021 results

ummary of FY2021 results
Revenue Government grant income EBITDA Operating (loss) / profit Acquisition costs expensed Impairment charges - Intangible assets - Right of use assets (Loss) / profit before tax	1stHalf $’000 2ndHalf $’000 FY2020 $’000 1stHalf $’000 2ndHalf $’000 16,832 21,138 37,970 20,678 23,371 - 1,315 1,315 2,320 -	FY2021 $’000
		44,049
		2,320
	16,832 22,453 39,285 22,998 23,371	46,369
	(2,983) 2,947 (36) 2,852 2,103
		4,955
	(4,247) 1,715 (2,532) 1,596 913 - - - - (5) - - - - (11,904) (182) (315) (497) (131) -
		2,509
		(5)
		(11,904)
		(131)
	(4,429) 1,401 (3,029) 1,465 (10,996)	(9,531)

The government grant income relates to JobKeeper receipts which ceased at the end of March 2021.

The impairment charge for intangible assets in FY2021 relate to the customer relationship asset and goodwill associated with the material government contract which came to an end in June 2021.

The impairment charges for right of use assets incurred in FY2021 relate to surplus leased office space in Sydney. This space has now been successfully sub-let.

The following graph displays revenue and EBITDA per month (left hand axis) and on a rolling 12-month basis (right hand axis) since January 2019 and illustrates the recovery in revenues and profits in the second half of FY2020 and continuing through FY2021.

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Acquisition of Saunders & Pitt, Tasmania

The acquisition of Saunders & Pitt announced on 15 March 2021 completed with effect 1 April 2021 which expanded Acumentis’ operations throughout Tasmania. This business generated annual revenues of $1.8M and PBT of $0.2M for the year ended 30 June 2021.

For FY2022, we expect this business to increase its revenue and contribution to group PBT.

Acquisition of Remaining 57.8% of Acumentis (WA) Holdings Pty Ltd

The acquisition of the remaining 57.8% of Acumentis (WA) Holdings Pty Ltd (the Company’s WA associate) completed effective 1 July 2021.

This business generated revenues of $7.0M and PBT of $1.1M for the year ended 30 June 2021.

Outlook

We continue to see high levels of demand for our services driven by buoyant lending activity for both new loans and refinancing. This is supported by historically low interest rates which we anticipate will remain low for the foreseeable future. We expect the strong property market to continue in the medium term and demand for our services to remain high. However, should the current COVID outbreaks continue for an extended period, then revenues could be adversely impacted.

With the geographical and services expansion, and the acquisition of the balance of our WA affiliate, we are well positioned to achieve ongoing revenue growth in FY2022. We are planning further significant investment to support the business growth and deliver future profitability.

We anticipate that our revenues will continue to grow through FY2022 towards our medium term expectation of $60M+ per annum. FY2022 operating margins are expected to be similar to FY2021 (before the one off impairment charges), however, profits are likely to be lower in the first half due to the ongoing investment in the business.

By order of the Board.

John Wise

Company Secretary

(02) 8823 6300 email john.wise@acumentis.com.au

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Acumentis is entrusted to provide commercial and residential valuations, research and property advice to many thousands of homeowners, investors, developers and lenders. The company offers property valuation, insurance valuation and advisory services to clients including major banks and financial institutions, property developers, property trusts, government, lawyers, accountants, real estate agents and major and independent retailers. With 40 offices and more than 300 staff in metropolitan and regional locations around the country, Acumentis is Australia’s only independent, locally owned, ASX-listed property valuation company.

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