- Real estate company McGrath (MEA) has swung into profitability over FY20, but its CEO is leaving the helm
- Company Chief Geoff Lucas chose to resign today after the company released its full-year results
- Speaking to the decision, Geoff said it was “now time to hand the business to refreshed leadership to continue successfully into the future”
- Geoff will be replaced by Edward Law, who will receive a $500,000 annual base salary and step into the role today
- Meantime, FY20 was a significant year for the ASX-lister — it tabled a $10.1 million turnaround in earnings before interest, taxes, depreciation and amortisation (EBITDA)
- The earnings results boosted MEA into profitability; it went from a $9.7 million loss in FY19 to a $700,000 profit in the 2020 financial year
- McGrath ended the day up a substantial 31.6 per cent, bringing its share price to 25 cents by market close
Real estate company McGrath (MEA) has swung into profitability over FY20, but its CEO is leaving the helm.
Company Chief Geoff Lucas chose to resign today after the company released its full-year results.
“We thank Geoff for navigating McGrath from losses to profitability through the
current COVID crisis, and we wish him all the very best in his future endeavours,” McGrath Chair Peter Lewis stated on Monday.
Speaking to the decision, Geoff said it was “now time to hand the business to refreshed leadership to continue successfully into the future.”
Geoff will be replaced by Edward Law, who will receive a $500,000 annual base salary and step into the role today.
In the past, Edward completed a 14-year stint at ANZ. His most recent role at the ‘big four’ bank was as Global Head of Institutional Property. The new McGrath CEO specialises in structured commercial real estate debt funding.
Other corporate roles he’s held include executive director of Newground Capital Partners and investment director of MaxCap Group.
“McGrath presents an exciting challenge and we have a sound platform, with strong cash reserves and brand positioning in what is a challenging market, ripe for consolidation,” Edward stated today.
FY20 results
Meantime, FY20 was a significant year for the ASX-lister — it tabled a $10 million turnaround in earnings before interest, taxes, depreciation and amortisation (EBITDA).
Breaking down that EBITDA figure, it seems nearly half of the earnings uptake was brought about by cost-cutting measures. In FY20, McGrath’s ‘cost of doing business’ expenses hit 54.1 per cent, down from FY19’s 66 per cent.
The earnings results boosted MEA into profitability; it went from a $9.7 million loss in FY19 to a $700,000 profit in the 2020 financial year.
On top of that, McGrath posted an 11 per cent increase in revenue, up to $91.6 million.
At the end of the financial year, the company had $17.3 million tucked away in cash reserves. It also reported no debt and tabled $30.2 million in net assets.
Looking ahead, the company maintains that Melbourne’s stage four lockdowns will have a limited impact on its FY21 financials.
McGrath ended the day up a substantial 31.6 per cent, bringing its share price to 25 cents by Monday’s market close.