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eXp World Holdings Reports Record Third Quarter 2018 Results

Revenue Accelerates to $157.2 Million, 232% Year-over-year Increase

BELLINGHAM, Wash., Nov. 13, 2018 (GLOBE NEWSWIRE) -- eXp World Holdings, Inc. (EXPI), the holding company for eXp Realty, the largest residential real estate brokerage by geography in North America, today announced financial results for the third quarter ended Sept. 30, 2018.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/2ef12f6e-8c80-4f42-899e-099ee8a0f4fd.

“This quarter we reported our highest quarterly revenue ever of more than $157 million as well as triple-digit-percent increases in transaction sales and volume, all of which are a direct result of our fantastic team of agents, brokers and staff who call eXp Realty home,” said eXp World Holdings, Inc. CEO, Chairman and Founder Glenn Sanford. “I am proud of all the great work everyone at eXp Realty is doing and it is great to see that it has translated into continued measurable, eXponential growth.”

Third Quarter 2018 Financial Summary

  • Revenue increased 232 percent in the third quarter, to a record $157.2 million, compared to $47.4 million in the third quarter of 2017. This represents sequential growth of more than 20 percent, compared to $130.5 million in the second quarter of 2018.
  • Gross profit grew 157 percent to $11.5 million in the third quarter of 2018, compared to $4.5 million in the third quarter of 2017.
  • Net loss was $4.6 million, or $(0.08) per diluted share in the third quarter of 2018, compared to net loss of $5.3 million, or $(0.10) per diluted share, in the third quarter of 2017.
  • Adjusted EBITDA (a non-GAAP financial measure) increased to $1.0 million in the third quarter of 2018, compared to ($0.9) million in the third quarter of 2017.
  • Cash flow from operations increased to $6.3 million in the third quarter of 2018, compared to $2.1 million in the third quarter of 2017.

Third Quarter 2018 Consolidated Operating and Business Highlights

  • The number of agents and brokers on the eXp Realty platform nearly tripled year-over-year, growing to 13,859 at the end of the third quarter of 2018 from 4,952 in the same quarter a year ago. This represents sequential growth of 17 percent, compared to 11,856 at the end of the second quarter of 2018.
  • Residential transaction sides closed in the third quarter of 2018 was 23,218, an increase of 211 percent compared to 7,456 during the third quarter of 2017. This represents sequential growth of 17 percent, compared to 19,903 during the second quarter of 2018.
  • Residential transaction volume closed in the third quarter of 2018 was $6.2 billion, an increase of 240 percent, compared to $1.8 billion during the third quarter of 2017. This represents sequential growth of 17 percent, compared to $5.3 billion during the second quarter of 2018.
  • Founder Glenn Sanford won a 2018 Inman Innovator Award for Most Innovative Broker Owner.

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. 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. (EXPI) is the holding company for eXp Realty, LLC, the largest residential real estate brokerage by geography in North America. eXp Realty (exprealty.com) is changing the way that agents, brokers and consumers work together in an adaptive, sustainable environment. As the leading, national, cloud-based real estate brokerage, eXp Realty provides 24/7 access to collaborative tools, training and socialization for real estate brokers and agents through its virtual campus environment. It is one of the fastest growing real estate brokerage firms in North America with more than 14,000 agents in 50 U.S. states, the District of Columbia and three Canadian provinces. As a publicly traded company, eXp World Holdings, Inc. uniquely offers real estate professionals within its ranks opportunities to earn company stock for production and contributions to overall company growth.

For more information, please visit the company’s website at www.eXpRealty.com.

Reported Consolidated Results


           
EXP WORLD HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
           
      September 30, 2018   December 31, 2017
           
           
ASSETS          
CURRENT ASSETS        
  Cash and cash equivalents $ 22,093,710     $ 4,672,034  
  Restricted cash   2,717,187       923,193  
  Accounts receivable, net of allowance $345,032 and $179,759, respectively   21,183,291       6,912,657  
  Prepaids and other assets   757,540       591,034  
  TOTAL CURRENT ASSETS   46,751,728       13,098,918  
OTHER ASSETS        
  Fixed assets, net   2,319,415       1,538,213  
  TOTAL OTHER ASSETS   2,319,415       1,538,213  
  TOTAL ASSETS $ 49,071,143     $ 14,637,131  
LIABILITIES AND STOCKHOLDERS' EQUITY    
CURRENT LIABILITIES      
  Accounts payable $ 1,527,470     $ 635,087  
  Customer deposits   2,717,187       923,193  
  Accrued expenses   21,181,935       8,818,180  
  TOTAL CURRENT LIABILITIES   25,426,592       10,376,460  
STOCKHOLDERS' EQUITY      
  Common Stock, $0.00001 par value 220,000,000 shares authorized; 58,968,762 and 54,962,535 shares issued and outstanding at September 30, 2018 and December 31, 2017, respectively   589       550  
  Additional paid-in capital   79,195,251       36,848,041  
  Accumulated deficit   (55,557,542 )     (32,596,374 )
  Accumulated other comprehensive income   6,253       8,454  
  TOTAL STOCKHOLDERS' EQUITY   23,644,551       4,260,671  
  TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 49,071,143     $ 14,637,131  
           

  

                       
EXP WORLD HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
                       
      Three Months Ended September 30,     Nine Months Ended September 30,  
        2018       2017         2018       2017    
                       
Revenues     $ 157,236,070     $ 47,371,745       $ 349,741,409     $ 107,880,869    
                       
Operating expenses                    
  Cost of revenues   145,740,264       42,903,624         319,560,992       96,604,633    
  General and administrative   14,769,707       9,175,260         43,447,290       19,643,788    
  Professional fees   581,723       223,811         1,770,869       906,654    
  Sales and marketing   774,479       380,452         2,130,644       1,030,497    
                       
  Total expenses   161,866,173       52,683,147         366,909,795       118,185,572    
                       
Net loss from operations   (4,630,103 )     (5,311,402 )       (17,168,386 )     (10,304,703 )  
                       
Other income and (expenses)                  
  Interest income (expense)   9,387       (58 )       9,387       (5,535 )  
                       
  Total other income and (expenses)   9,387       (58 )       9,387       (5,535 )  
                       
Loss before income tax expense   (4,620,716 )     (5,311,460 )       (17,158,999 )     (10,310,238 )  
                       
Income tax expense     (7,455 )     (3,277 )       (52,175 )     (51,615 )  
                       
Net loss     $ (4,628,171 )   $ (5,314,737 )     $ (17,211,174 )   $ (10,361,853 )  
                       
Net loss per share attributable to common shareholders                
  Basic from continuing operations $ (0.08 )   $ (0.10 )     $ (0.30 )   $ (0.20 )  
  Diluted from continuing operations $ (0.08 )   $ (0.10 )     $ (0.30 )   $ (0.20 )  
                       
Weighted average shares outstanding                
  Basic     58,360,233       53,335,822         57,069,377       52,837,134    
  Diluted     58,360,233       53,335,822         57,069,377       52,837,134    
                       


   
   US-GAAP Net Income (Loss) to Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation, QTD Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18
Net Income / (Loss) $ (2,899,821 ) $ (2,147,296 ) $ (5,314,737 ) $ (11,769,111 ) $ (10,696,345 ) $ (1,886,658 ) $ (4,628,171 )
Interest   1,715     3,762     58     (3,458 )   -     -     (9,387 )
Taxes   24,591     23,747     3,277     45,619     30,450     14,270     7,455  
Depreciation & Amortization   13,265     81,437     112,487     146,040     183,321     147,558     240,031  
Stock Compensation   646,232     757,145     2,357,877     7,200,377     8,279,109     3,989,602     4,238,667  
Stock Option   1,467,735     1,126,195     1,971,394     2,290,705     1,301,702     1,181,969     1,103,055  
Adjusted EBITDA     (746,283 )     (155,010 )     (869,644 )     (2,089,829 )     (901,763 )     3,446,741       951,650  
               

 

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