eXp World Holdings, Inc. · NASDAQ:AGNT
eXp World — Q1 2023 Earnings Presentation
34 slides from eXp World's earnings presentation, May 2023
Slide 1: Investor Presentation Q1 2023
INVESTOR PRESENTATION Q1 2023
Slide 2: Safe Harbor
SAFE HARBOR The statements contained herein may include statements of revenue growth and financial performance. Such statements future expectations and other forward-looking statements1 are not guarantees of future performance. Important factors that are based on management’s current views and that m
Slide 3: eXp World Holdings Highlights
eXp World Holdings | HIGHLIGHTS Cloud-Based Increasing Solid Global Strong Agent Fastest Brokerage Market Share Financial Network Value Prop Growing Model Profile Efficient operating >87,000 agents1 Consistent 24 markets Suite of offerings #1 growth model built to positive cash worldwide enable agent s
Slide 4: Real Estate is Cyclical
Real Estate is Cyclical CURRENTLY EXPERIENCING DOWNWARD MARKET DRIVERS UPWARD MARKET DRIVERS DOWNWARD MARKET DRIVERS EXPANSION HYPERSUPPLY The industry continues to grow through cycles. 1975-2022 263% growth in number of U.S. realtors* RECOVERY RECESSION *Source: National Association of Realtors, 1/
Slide 5: We Were Built For This
We Were Built For This A SUSTAINABLE MODEL THROUGH ALL MARKET ENVIRONMENTS Strong agent value proposition ● Agent support drives organic market share growth, retention and productivity Efficient Operating Model ● Lower fixed costs driven by cloud-based model and no brick-and-mortar ● Organic agent grow
Slide 6: Revenue & Agent Growth
Revenue & Agent Growth CONTINUED GROWTH IN AGENT COUNT DESPITE A CHALLENGING REVENUE ENVIRONMENT eXp Realty Ending Agents and Revenue By Quarter Q1 2023 Agent Growth YoY 12% 87K+ Agents as of 3-31-23 Agent Count Total Q1 2023 Revenue $850.6M Revenue 6
Slide 7: Superior Agent and Broker Value Proposition
Superior Agent and Broker Value Proposition EXP'S CLOUD MODEL ENABLES RICHER UNIT ECONOMICS AND BROADER GEOGRAPHICAL REACH FOR AGENTS Traditional Brokerage vs. eXp Realty Operating Model Operating Model ● High operating expenses and capital costs associated ● Cloud-based model with minimal brick-and
Slide 8: High-Quality, Productive Agents
High-Quality, Productive Agents EXP'S MODEL DRIVES RETENTION AMONG HIGHLY PRODUCTIVE AGENTS Attrition by U.S. Agent Annual Productivity 0 - 2 sales 75.9% 3 - 7 sales 14.0% 3.6X Top producing agents 8 - 12 sales 4.9% are 3.6 times less likely to churn than low producers 13 - 20 sales 3.2% 21+ sales 2
Slide 9: Model Drives Organic Growth & Retention
Model Drives Organic Growth & Retention AGENTS ARE INCENTIVIZED TO BUILD THE PLATFORM AND STAY AT EXP THROUGH REVENUE SHARE Agents Driving Organic Growth | RECEIVING REVENUE SHARE 15000 14,742 19.9% of Agents 12500 11,859 18.8% of Agents 10000 Agent Count 7500 7,145 18.3% of Agents 5000 4,816 19.6%
Slide 10: Unique Model Provides Agent Equity Opportunities
Unique Model Provides Agent Equity Opportunities1 AGENTS AND BROKERS ARE LESS LIKELY TO PURSUE OTHER OPPORTUNITIES IF THEY ARE SHAREHOLDERS Equity Awards Agent Equity ICON Agent Award Through Incentive Commission Program Program Additional $4,000 stock Top agents can receive up to $16,000 in stock a
Slide 11: Growth-Oriented & Agent-Led Culture Driving Industry-Leading Programs
Growth-Oriented & Agent-Led Culture Driving Industry-Leading Programs eXp UNIVERSITY MENTORSHIP MASTERMINDS & BROKER SUPPORT TASK FORCES The most innovative Whether you are This is your opportunity Our State Broker Teams university OWNon&the planet! GROW brand new or starting to collaborate with top
Slide 12: Enhancing The Lives Of Our Agents And Our Communities
Enhancing The Lives Of Our Agents And Our Communities We are committed to creating an We are dedicated to the betterment We are committed to wellbeing. equitable, diverse and inclusive of our communities. culture for our employees, agents eXp’s affiliated 501(c)(3) and brokers. The first week of Octobe
Slide 13: Exponential Growth Potential
Exponential Growth Potential INFLUENCERS AND NEW AGENTS eXp REALTY INFLUENCER Chuck Fazio NEW eXp REALTY AGENT Kristen Cantrell Joined eXp Realty in 2018 Joined eXp Realty in 2020 under Chuck Fazio ● Previously ran the largest single office brokerage ● Started team in January 2021 in the U.S. (founded
Slide 14: Today's Market Attracts Broker Teams to eXp
Today’s Market Attracts Broker Teams to eXp AS TRANSACTIONS DECREASE, LIMITED FIXED COST MODEL RETURNS MORE PROFITS TO AGENTS Utah-based Lawson Team of 15 agents Ige Johnson Group moved 35 of the 50 Incorvaia Team, which ranked No. 2 in led by David Lawson. The team moved top producing agents from R
Slide 15: Cloud-First Operating System Creates Competitive Advantage
Cloud-First Operating System Creates Competitive Advantage eXp is one of the only companies operating within a Best-in-class technology partnerships designed to metaverse at scale enhance agent productivity ● Virbela enables eXp to host company meetings, learning and ● Industry-leading CRM options f
Slide 16: Multiple Expansion Opportunities
MULTIPLE EXPANSION OPPORTUNITIES 16
Slide 17: A Large & Underpenetrated Addressable Market
A Large & Underpenetrated Addressable Market Total Addressable Market $488B +$488B $195B Expanded Opportunity 5 International Residential Real Estate Brokerage +$195B $112B Expansion 4 U.S. Commercial Brokerage +$112B Growth Verticals 3 $54B Mortgage, Title & Escrow +34B 1) NAR - 2022 Existing Home
Slide 18: Segments Reflect eXp's Strategic Priorities
Segments Reflect eXp’s Strategic Priorities NORTH AMERICAN REALTY, INTERNATIONAL REALTY, VIRBELA AND OTHER AFFILIATED SERVICES North American Realty ● Profitable core business funds agent-centric innovation ● Driving agent-centric innovation with Revenos™, eXp Luxury™, eXp Referral™ division, eXp Solu
Slide 19: Strengthening Our Agent Value Proposition
Strengthening Our Agent Value Proposition ENHANCE AGENT AND CONSUMER OFFERING WHILE GENERATING ATTRACTIVE, HIGH-MARGIN REVENUE STREAMS ENHANCING OUR EXPANDING SUCCESS FOR SERVICE OFFERINGS PERSONAL DEVELOPMENT Delivering industry-leading coaching and Driving high-quality buyer and seller certificatio
Slide 20: One Brokerage Expanding Globally
One Brokerage Expanding Globally EXP IS CAPTURING GLOBAL MARKET SHARE WITH 52% YEAR-OVER-YEAR1 INTERNATIONAL REVENUE GROWTH EFFECTIVE ENTRY OF 24 NEW MARKETS DRIVEN BY: IN-COUNTRY LEADERSHIP AND REGIONAL SHARED SERVICE HUBS Experienced local teams in each geography are responsible for agent operatio
Slide 21: Expanding the Metaverse Opportunity
Expanding the Metaverse Opportunity ENTERPRISES DEPLOYING VIRBELA TO CREATE END-TO-END EMPLOYEE EXPERIENCE PROGRAMS RECRUITING ONBOARDING, EMPLOYEE STAFF CORPORATE LEARNING, & ENGAGEMENT MEETINGS EVENTS DEVELOPMENT
Slide 22: Financials
FINANCIALS 22
Slide 23: Track Record of Cash Flow Generation
Track Record of Cash Flow Generation 242 Adjusted EBITDA (1) 250 218 Operating Cash Flow (2) 207 200 150 99 100 78 58 61 56 51 50 $ IN MILLIONS 23 13 4 2 0 (4) (50) 2017 2018 2019 2020 2021 2022 TTM Q1 23 (1) Adjusted EBITDA is a non-GAAP term, “Use of Non-GAAP Financial Measures” as disclosed in ou
Slide 24: Operating Efficiently
Operating Efficiently LOWEST GAAP OPERATING EXPENSES PER AGENT & TRANSACTION Operating Expenses / Agent | Q4 2022 Operating Expenses / Transaction | Q4 2022 $80,000 $10,500 $77,136 $10,072 $70,000 $60,000 $7,987 $8,000 $50,000 $40,000 $5,500 $30,000 $26,100 $3,575 $20,000 $3,000 $1,769 $10,000 $1,522
Slide 25: Strong, Consistent Cash Flow Enables Return of Capital to Shareholders
Strong, Consistent Cash Flow Enables Return of Capital to Shareholders $123 MILLION IN CASH | NO DEBT AS OF 3-31-23 Cumulative Share Repurchases Cumulative Dividends Paid 500 BOD increases quarterly dividend by 12.5% to $0.045/share 488 451 50 43 405 400 BOD increases repurchase 37 438 $ IN MILLIONS
Slide 26: Q1 2023 Segment Financial Highlights
Q1 2023 Segment Financial Highlights ● In Q1, home sales declined 29% compared to the same period last year(1) ● Interest rates ranged from 6.1% to 6.7% in Q1, relatively flat from year-end(2) ● Inventory remains constrained with listings in Q1 improving from Q1 2022 lows but still significantly below
Slide 27: 2023 Roadmap
2023 ROADMAP Maintain strong balance Leverage eXp’s disruptive STRONG sheet & cash flow model and technology- COST generation based core MANAGEMENT $123 million Variable cost Balance capacity to of cash as of structure & organic match transaction 3/31/23 growth model volume provides resilience Mainta
Slide 28: eXp World Holdings Leadership
eXp World Holdings Leadership FOUNDER-LED AND SEASONED TEAM Glenn Jeff Courtney Sanford Whiteside Keating Founder & Chairman CFO & Chief CEO, eXp World Holdings Chief Marketing CEO, eXp Realty Collaboration Officer Officer James Jason Gesing Shoeb Bramble Chief Industry Ansari Chief Counsel Relation
Slide 29: eXp Realty Leadership
eXp Realty Leadership FOUNDER-LED AND SEASONED TEAM Michael Patrick Carolyn Valdes O'Neill Merchant Chief Growth Chief Operating Chief Officer Officer Marketing Officer Mike Leo Vein Pareja Executive Chief Strategy Vice President, Officer People
Slide 30: Investor Relations Contact
INVESTOR RELATIONS CONTACT [email protected] | 360-685-4206 2219 Rimland Dr, Suite 301, Bellingham, WA 98226 expworldholdings.com
Slide 31: Appendix
Appendix
Slide 32: Company Timeline 2009-2022
2009 2010 2011 2012 2013 eXp Realty is founded eXp celebrates 1-year eXp recognized as eXp Realty eXp World Holdings goes anniversary, operating in 11 Innovator by Inman launches in Canada public on OTCQB exchange states 2014 2015 2016 2017 2018 Founder and CEO Glenn Sanford eXp launches Agent Equit
Slide 33: Awards and Recognition
exp REALTY MARKETING LEADERSE=HI REALTRENDS GC2021 GAMECHANGERS VV. NGUARDS: glassdoor “ BEST PLACES awork ¢ 5 an ot INSIDERS: 4% RESO Remote 2021 RISING STARS 0) Technology Fast 500 2021 NORTH AMERICA — RISMedia REAL ESTATE NEWSMAKERS 2021 REALTRENDS FIVE HUNDRED Cc) EY Entrepreneur UW of The Year
Slide 34: Unique Model Incentivizes Agents and Brokers
Unique Model Incentivizes Agents and Brokers HIGHLY ATTRACTIVE VERY LOW STARTUP COSTS COMMISSION STRUCTURE AND COMMITMENT COMMISSION* PER TRANSACTION FEE* ONE-TIME COSTS* ● Agents receive an ● $25 Broker Review 80/20 split on first ● $40 Risk Management Fee ● $149 one-time setup fee includes business