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eXp World Holdings Reports Record Third Quarter 2017 Results

Revenue increased 203% year-over-year to $48.1 million

BELLINGHAM, WA--(Marketwired - November 14, 2017) -

  • Record revenue of $48.1 million, increase of 203% year-over-year
  • Record cash flow of $3.3 million, increase of 255% year-over-year
  • Record real estate agent increase of 173% year-over-year, surpassed 5,000 in early October

eXp World Holdings, Inc. (OTCQB: EXPI), the holding company for eXp Realty, LLC, the agent-owned cloud brokerage®, today announced financial results for the third quarter ended Sept. 30, 2017.

Third Quarter 2017 Financial Summary

  • Revenue increased 203% to a record $48.1 million from $15.8 million in the third quarter of 2016. This represents 22% growth quarter-over-quarter, from $39.6 million in the second quarter of 2017.
  • Gross margin grew 96% year-over-year for the same quarter to $4.81 million; $12.1 million year-to-date compared to $5.3 million for the same nine-month period in 2016.
  • Net loss was $7.8 million, or $(0.15) per diluted share, compared to net loss of $14.6 million, or $(0.29) per diluted share in the third quarter of 2016.
  • Adjusted EBITDA (a non-GAAP financial measure) decreased 24% to $0.6 in the third quarter of 2017, compared to $0.8 in the third quarter of 2016.
  • Cash flow from operations increased 255% to $3.3 million from $0.9 million in the third quarter of 2016. This represents 106% growth quarter-over-quarter, compared to $1.6 million in the second quarter of 2017.

Third Quarter 2017 Operating and Business Highlights

  • Increased the number of agents and brokers on the eXp Realty platform by 173% to 4,952, compared to 1,816 on the same date last year. This represents 26% growth quarter-over-quarter, compared to 3,913 at the end of the second quarter of 2016.
  • Surpassed a 5,000-agent milestone in early October 2017.
  • Hired Mary Frances Coleman as chief operating officer, Vicki Olafson as vice president of employee experience and Macie Hawkes as general counsel.
  • Expanded into Mississippi and Ontario, Canada.

"eXp World Holdings finished the third quarter of 2017 with another quarter of record revenue, further solidifying our foundation for long-term growth," said eXp World Holdings CEO and Chairman Glenn Sanford. "Our rapidly growing agent and broker family helped us achieve a major 5,000-agent milestone, which we announced at our fourth annual national conference in early October. As we continue to expand into new markets and deeper into existing ones, it is clear our business model of delivering strong economic, technology and marketing solutions resonates with agents and brokers. We are excited about the continued success and opportunities in front of us."

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. (OTCQB: EXPI) is the holding company for eXp Realty, LLC, the Agent-Owned Cloud Brokerage®. eXp Realty (exprealty.com) is changing the way that agents, brokers and consumers work together in an adaptive, sustainable environment. It is an agent-designed and agent-owned company. 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 3-D, fully-immersive, cloud office environment. It is one of the fastest growing real estate brokerage firms in North America with more than 5,600 agents in 45 U.S. states, the District of Columbia and the provinces of Alberta and Ontario, Canada. 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 websites at expworldholdings.com and exprealty.com.

Connect with eXp Realty and eXp World Holdings:

The eXp World Holdings logo is available at http://expworldholdings.com/logos. The agent-owned cloud brokerage is a registered trademark of eXp Realty, LLC.

Reported Consolidated Results

                                                                            
                          EXP WORLD HOLDINGS, INC.                          
                    CONDENSED CONSOLIDATED BALANCE SHEETS                   
                                 (UNAUDITED)                                
                                                                            
                                                                            
                                           September 30,      December 31,  
                                         ----------------- -----------------
                                                2017              2016      
                                         ----------------- -----------------
                                                                            
ASSETS                                                                      
CURRENT ASSETS                                                              
  Cash and cash equivalents              $      3,347,910  $      1,684,608 
  Restricted cash                               1,134,109           481,704 
  Accounts receivable, net of allowance                                     
   $177,563 and $133,845, respectively          7,549,469         3,015,767 
  Prepaids and other assets                       587,904           383,563 
                                                                            
                                         ----------------- -----------------
    TOTAL CURRENT ASSETS                       12,619,392         5,565,642 
                                                                            
OTHER ASSETS                                                                
  Fixed assets, net                             1,298,215           538,405 
                                                                            
                                         ----------------- -----------------
    TOTAL OTHER ASSETS                          1,298,215           538,405 
                                                                            
    TOTAL ASSETS                         $     13,917,607  $      6,104,047 
                                         ================= =================
                                                                            
                                                                            
LIABILITIES AND STOCKHOLDERS' EQUITY                                        
                                                                            
CURRENT LIABILITIES                                                         
  Accounts payable                       $        412,439  $        317,420 
  Customer deposits                             1,134,109           481,704 
  Accrued expenses                              7,745,153         2,742,119 
  Notes payable                                         -            35,778 
                                                                            
                                         ----------------- -----------------
    TOTAL CURRENT LIABILITIES                   9,291,701         3,577,021 
                                                                            
  Commitments and contingencies                         -                 - 
                                                                            
STOCKHOLDERS' EQUITY                                                        
    Common Stock, $0.00001 par value                                        
     220,000,000 shares authorized;                                         
     53,995,962 shares and 52,316,679                                       
     shares issued and outstanding at                                       
     September 30, 2017 and December 31,                                    
     2016, respectively                               540               523 
    Additional paid-in capital                 41,238,713        34,526,859 
    Accumulated deficit                       (36,621,221)      (32,004,561)
    Accumulated other comprehensive                                         
     income (loss)                                  7,874             4,205 
                                                                            
                                         ----------------- -----------------
    TOTAL STOCKHOLDERS' EQUITY                  4,625,906         2,527,026 
                                                                            
    TOTAL LIABILITIES AND STOCKHOLDERS'                                     
     EQUITY                              $     13,917,607  $      6,104,047 
                                         ================= =================
                                                                            
                                                                            
                                                                            
The accompanying notes are an integral part of these condensed consolidated 
                            financial statements.                           
                                                                            
                                                                            
                          EXP WORLD HOLDINGS, INC.                          
               CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS              
                                 (UNAUDITED)                                
                                                                            
                                                                            
                                                                            
                                                                            
                          Three Months Ended     Nine Months Ended September
                            September 30,                    30,            
                     --------------------------- ---------------------------
                          2017          2016          2017          2016    
                     ------------- ------------- ------------- -------------
                                                                            
Net revenues         $ 48,105,769  $ 15,756,956  $109,691,317  $ 36,181,796 
                     ------------- ------------- ------------- -------------
                                                                            
Operating expenses                                                          
  Cost of revenues     43,291,473    13,294,452    97,620,066    30,868,564 
  General and                                                               
   administrative      11,987,268    16,810,567    14,697,040    25,801,423 
  Professional fees       223,811       140,804       906,654       414,197 
  Sales and                                                                 
   marketing              380,452       158,968     1,030,497       358,396 
                                                                            
                     ------------- ------------- ------------- -------------
  Total expenses       55,883,004    30,404,791   114,254,257    57,442,580 
                                                                            
Net loss from                                                               
 operations            (7,777,235)  (14,647,835)   (4,562,940)  (21,260,784)
                                                                            
Other income and                                                            
 (expenses)                                                                 
  Other income                  -          (432)            -            14 
  Interest expense            (58)            -        (2,105)            - 
                                                                            
                     ------------- ------------- ------------- -------------
  Total other income                                                        
   and (expenses)             (58)         (432)       (2,105)           14 
                                                                            
                     ------------- ------------- ------------- -------------
Loss from before                                                            
 income tax expense    (7,777,293)  (14,648,267)   (4,565,045)  (21,260,770)
                                                                            
Income tax expense         (3,277)       (7,444)      (51,615)      (33,015)
                                                                            
                     ------------- ------------- ------------- -------------
Net loss               (7,780,570)  (14,655,711)   (4,616,660)  (21,293,785)
                                                                            
Net loss                                                                    
 attributable to                                                            
 non-controlling                                                            
 interest in                                                                
 subsidiary                     -         8,613             -        20,913 
                                                                            
                     ------------- ------------- ------------- -------------
Net loss                                                                    
 attributable to                                                            
 common shareholders $ (7,780,570) $(14,647,098) $ (4,616,660) $(21,272,872)
                     ============= ============= ============= =============
                                                                            
Net loss per share                                                          
 attributable to                                                            
 common shareholders                                                        
  Basic from                                                                
   continuing                                                               
   operations        $      (0.15) $      (0.29) $      (0.09) $      (0.42)
                     ------------- ------------- ------------- -------------
  Diluted from                                                              
   continuing                                                               
   operations        $      (0.15) $      (0.29) $      (0.09) $      (0.42)
                     ------------- ------------- ------------- -------------
                                                                            
Weighted average                                                            
 shares outstanding                                                         
  Basic                53,335,822    51,225,817    52,837,134    50,929,102 
                     ------------- ------------- ------------- -------------
  Diluted              53,335,822    51,225,817    52,837,134    50,929,102 
                     ------------- ------------- ------------- -------------
                                                                            
                                                                            
The accompanying notes are an integral part of these condensed consolidated 
                            financial statements.                           
                                                                            
                                                                            
         US-GAAP NET INCOME (LOSS) TO ADJUSTED EBITDA RECONCILIATION        
                                                                            
                                                    Quarter Ended,          
Adjusted EBITDA reconciliation                 Sep-16            Sep-17     
----------------------------------------------------------------------------
Net Income / (Loss)                      $    (14,655,711) $     (7,780,570)
Interest                                                -                58 
Taxes                                               7,444             3,277 
Depreciation & Amortization                        12,555           125,752 
Stock Compensation                                795,401         4,846,596 
Stock Option                                   14,632,458         3,409,851 
                                         -----------------------------------
Adjusted EBITDA                          $        792,147  $        604,964 

Media relations contact:
Cynthia Nowak
Director of marketing and communications
eXp Realty
360-419-5285, ext. 116
Email contact


Investor relations contact:

Greg Falesnik
Managing Director
MZ Group - MZ North America
949-385-6449
Email contact

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