RUN Corp Limited Results presentation FY 2013 23 August 2013

To be read in conjunction with FY2013

Annual Report and other ASX releases 1

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Disclaimer

The information provided is general in nature and is in summary form only. It is not complete and should be read in

conjunction with the Company’s detailed results and market disclosures. This material is not intended to be relied upon as

advice to investors or potential investors.

Non-IFRS information

Throughout this presentation, RUN has included certain non-IFRS financial information. This information is presented to

assist in making appropriate comparisons with prior periods and to assess the operating performance of the business. RUN

uses these measures to assess the performance of the business and believes that the information is useful to investors.

EBITDA , PBT (excluding re-financing gain), EBITDA (excluding re-financing gain) and Net debt have not been audited but

have been extracted from RUN’s audited financial statements. All other non-IFRS measures, unless otherwise stated, have

not been extracted from RUN’s audited financial statements. For reconciliation to IFRS compliant profit for the period, refer

to the slide on pages 24-25.

Forward looking statements

This presentation contains forward-looking statements that involve subjective judgment and analysis and are subject to

significant uncertainties, risks and contingencies, many of which are outside the control of, and are unknown to RUN.

Forward-looking statements can generally be identified by the use of forward-looking words such as “may”, “will”, “expect”,

“believes”, “plan”, “seeks”, “estimate”, “anticipate”, “can“, or similar words.

No representation, warranty or assurance (express or implied) is given or made in relation to any forward looking statement

by any person (including RUN). In addition, no representation, warranty or assurance (express or implied) is given in

relation to any underlying assumption or that any forward looking statements will be achieved. Actual future events may

vary materially from the forward looking statement and the assumptions on which the forward looking statements are

based. Given these uncertainties, readers are cautioned not to place undue reliance on such forward looking statements.

The factors that may affect RUN’s future performance include, among others:

- Changes in the legal and regulatory regimes in which RUN operates;

- Changes in behaviour of RUN’s major customers;

- Changes in behaviour of RUN’s major competitors;

- General changes in the economic conditions of the major markets in which RUN operates.

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Contents

↘ Section 1: Group summary

- FY13 highlights

- Profit improvement

- Debt reduction

- Name change from ‘RUN Corp Ltd’ to ‘Real Estate Corp Ltd’

- Business overview

↘ Section 2: RUN Property Pty Ltd

Business overview

↘ Section 3: Agentplus Pty Ltd

Business overview

↘ Section 4: Maintenance Matcher Pty Ltd

Business overview

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Group summary Section 1

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FY13 - Highlights

Debt

Reduction

↘ Reduction in *net debt for the period of $5.4M

↘ *Net debt now $11.4M

↘ Debt secured against rent roll indicatively valued at $60M

Profit

Improvement

↘ *Profit before tax of $2.3M up $3.2M from FY12 (excl. FY12 refinancing gain)

↘ *EBITDA of $5.517M for the period, up 16% from the previous year

↘ Cashflow from operations of $3.5M, against $3.1M for the previous period

↘ Original rent roll acquisitions now fully amortised. Rent roll amortisation will reduce

by an approximate further $500K over the next period.

Maiden

dividend

↘ Maiden fully franked interim dividend paid 22 March 2013 of 0.4 cents /share

↘ A further fully franked dividend was declared in August 2013 of 0.4 cents / share

↘ Full year fully franked dividend totalled 0.8 cents per share

Name

change

↘ It is RUN Corp’s goal to build a portfolio of Real Estate related businesses and has

therefore decided to change the name of the public entity to Real Estate Corp Ltd,

subject to approval at the next AGM.

↘ The Board feels that this name more aptly reflects the function of the business and its

intention to build a diversified real estate group.

↘ At a group level there have been some significant improvements in the business:

New

ventures

↘ New Maintenance Matcher business to be launched to capitalise on the challenges

faced by consumers, agents and suppliers when arranging maintenance

↘ Growth in scale and profitability of RUN’s sales division reported

*Refer to Appendix on pages 24-25 for reconciliation of non-IFRS information 5

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Profit improvement

↘ FY13 *Profit before tax result of $2.3M up $3.2M from FY12 (excl. FY12 refinancing gain)

↘ FY13 *EBITDA result of $5.5M was 16% higher than the previous year. Includes a number of investments in

growth in the second half.

↘ Amortisation charge (primarily non-cash) will reduce further as acquisition of rent rolls have been fully amortised.

5.5

4.8

4.0

4.2

2.6

2013

2012

2011

2010

2009

EBITDA PERFORMANCE (EXCL. RE-FINANCE GAIN*)

Actual FY13

Actual FY12

Actual FY11

Revenue $27.7M $28.4M $28.4M

Profit (loss) before tax* $2.3M ($0.9M) ($5.6M)

Amortisation $1.5M $2.8M $5.5M

EBITDA* $5.5M $4.8M $4.0M

Cashflow from operations $3.5M $3.1M $0.8M

Net debt / EBITDA x 2.1 x 3.3 x 9.0

2.0

3.5

8.5

8.6

13.8

2013

2012

2011

2010

2009

NET DEBT / EBITDA*

x x

x

x

x

x x

x

2.3

-0.9

-5.6

-5.5

-6.5

PBT PERFORMANCE (EXCL. RE-FINANCE GAIN*)

x

x

6

*Refer to Appendix on pages 24-25 for reconciliation of non-IFRS information

EXCL. RE-FINANCE GAIN*

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Debt reduction

↘ The group’s debt position has

significantly improved and now has a

sustainable debt position.

↘ Net debt position further improved

by $5.4M with net debt $11.4M as at

30 June 13.

↘ Implied equity in rent roll $48.6M as

at 30 June 2013.

↘ Loan to value ratio 19%

↘ Annual interest cost reduced by

$1.2M per annum with further

reductions expected with debt

repayments.

↘ Rent roll value remained stable with

debt secured against rent roll valued

indicatively at $60M

11.4

17.0

34.0

42.0

Jun-13

Jun 12

Jun 11

Jun 07

NET DEBT POSITION

Actual FY12

Actual FY11

Change FY13/FY12

Indicative rent roll value $60M $60M $60M -

Net debt* $11.4M $17M $34M √ -$5.6M Implied LVR (net

debt:rent roll) 19% 28% 57%

Implied rent roll equity $48.6M $43M $26M √ +$5.6M

Finance costs $1.5M $2.7M $3.6M √ -$1.2M

48.6

43.0

24.2

18.0

Jun 13

Jun 12

Jun 11

Jun 07

RENT ROLL EQUITY

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*Refer to Appendix on pages 24-25 for reconciliation of non-IFRS information

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Name change

↘ RUN Corp Limited, the public entity, holds 100% interest in (i) RUN Property – Australia’s largest independently

owned real estate firm, (ii) Agentplus – a provider of technology and outsourced services to the real estate industry,

and (iii) recently launched Maintenance Matcher – a maintenance provider sourcing platform.

↘ It is RUN Corp’s goal to build a portfolio of real estate related businesses and has therefore decided to change the

name of the public entity to Real Estate Corp Limited. The Board feels that this better reflects the function of the

business and its intention to build a diversified real estate group. This will be put to shareholders at the next AGM.

↘ Maintenance Matcher is a new business being launched by the group, developed to assist real estate agents,

consumers and tradespeople achieve better outcomes when seeking maintenance providers.

Real Estate Corp

Limited

Currently named RUN Corp Limited. The new name Real Estate Corp better reflects a company who plans to develop a diversified stable of real estate businesses.

Maintenance Matcher is an online advertising business that assists in matching a supplier (trade) with a maintenance job in a certain location, via the use of a sophisticated portal. The business provides better outcomes for landlords, consumers, property managers and tradespeople.

Agentplus is a back-office provider of cloud based technology and outsourced services to the real estate industry. Agentplus has recently won the Australian Real Estate Awards ‘Best IT platform in-house’ award.

RUN Property is Australia’s largest independently owned real estate company providing sales, leasing and management services. Today, RUN manages over $10B of rental properties in over 500 postcodes across Australia. 8

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Group entities

Real Estate Corp Limited

Public company, investing in a diversified portfolio of real estate businesses.

DESCRIPTION REVENUES PROFIT CONTRIBUTION

ASSETS

A real estate business providing sales, leasing and management services.

Provider of technology and back office services to the real estate industry.

A maintenance sourcing business providing better outcomes for consumers.

Nil

Cost: $2.5M Provides public co. framework for the group.

$26.1M PM VIC – $11.6M PM NSW – $8.1M PM QLD – $3.4M Sales - $3.0M

Contribution to profit: $7.2M PM VIC – $3.7M PM NSW – $2.3M PM QLD – $0.9M Sales - $0.3M

$3.2M, including inter-segment sales

Contribution to profit: $0.8M

Planned launch in FY14

Planned launch in FY14

Rent roll valued at indicatively $60M. $11.4M net debt secured against rent roll

Valuable IT platform that is capable of considerable scale.

Has developed intellectual property for FY14 launch.

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RUN Property Pty Ltd Section 2

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RUN Property overview

BUSINESS DESCRIPTION

↘ RUN Property provides sales, leasing and management services in over 500 postcodes across Australia

↘ The property management division revenues are predominantly reoccurring, providing stable and predictable income

and profit contributions. Rent rolls are regularly bought and sold within the real estate industry and are generally able to

be used to secure debt. The rent roll that underpins the property management business is indicatively worth $60M but

due to the nature of the asset is not fully accounted on the balance sheet.

↘ RUN also operates a sales division, which although is a relatively new addition to the group provides a significant

opportunity for revenue, profit and brand growth. The property market has strengthened in more recent times in terms of

both property values and transaction volumes and RUN believes the timing is right to substantially invest in this part of

its business.

Actual FY12

Actual FY11

Change FY13/FY12

Property mgt revenue $23.1M $23.5M $23.0M ($0.4M)

EBITDA contribution $7.0M $6.9M $5.7M √ $0.1M

Sales gross comm revenue $3.0M $2.9M $3.3M √ $0.1M

EBITDA contribution $0.2M $(0.3)M $(0.2)M √ $0.5M

% opportunities sold++ 30% 22% 15%

↘ EBITDA contribution from property

management activities was $100K higher

than the previous period

↘ EBITDA contribution from sales improved by

$537K over the period

↘ The percentage of sales opportunities sold

also increased from 22% to 30% over the

period demonstrating improving share of

sales off the rent roll sold by RUN agents.

This excludes the opportunity of selling non

rent roll properties

PER ANNUAL REPORT SEGMENT REPORTING

11 ++ % of properties sold off the rent roll that were sold by RUN

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Growth opportunities

GROWTH OPPORTUNITY

↘ According to the 2012 Macquarie benchmark report1, the average

Australian real estate business generates in excess of $1 of sales

income for every $1 of property management income.

↘ This being the case, under the same metrics RUN should be able

to deliver in excess of $23M in revenues from its sales division

from its $23M property management revenues.

↘ Given RUN’s existing office network and infrastructure it can

leverage its fixed cost base to deliver this

↘ A strong sales business also drives improved brand awareness

that assists in growing the rent roll business in turn.

↘ There are three key initiatives RUN is focussed on to capitalise on

this opportunity:

1. Execute a brand re-fresh

2. Develop supporting IT and business processes

3. Recruitment of quality sales staff

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3

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Current Future opportunity

Property Mgt Sales

A typical real estate agency achieves at least $1 of sales revenue for every $1 of PM income. If RUN can achieve this, in excess of $20M additional revenue could be generated.

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1. Macquarie Relationship Banking 2012 residential real estate benchmarking report

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Sales growth

1. BRAND RE-FRESH

↘ When selling or leasing their property, consumers generally wish to use an

agent that can make their property look the best it can be.

↘ Similarly, real estate agents want to work in agencies where they are proud

of their surroundings and have the resources and facilities required to service

clients.

↘ Over the course of FY13 year, RUN:

- Recruited a new Marketing Manager to lead RUN’s marketing initiatives

- Opened a number of new office locations with a new modern look

- Refurbished a number of old offices with its new modern look

- Rolled out new look ‘For Sale’ and ‘For Lease’ boards

- Updated RUN livery with the new look and feel

↘ The new look is designed to represent RUN’s modern and progressive

approach, utilising silver and black which sits comfortably when selling or

leasing a high, middle or lower end property.

↘ There are three key initiatives underway to support growth of the sales division:

RUN’s new look for sale and lease boards.

RUN Toowong office

RUN’s new look office design. 13

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Sales growth

2. IT & SYSTEMS

↘ RUN is well recognised for developing world class IT and business systems to

support its property management business

↘ Recently RUN won the Real Estate award for ‘Best IT platform – in-house’

↘ A key issue for the Australian real estate industry is that many agencies are

operating in out-dated ways with little to no focus on business process or

technological support. Often agents are recruited and subsequently provided

little support.

↘ RUN is focussed on delivering a new way of doing business by providing

agents best of breed business systems and technology allowing them to obtain

better outcomes for themselves and their clients.

↘ During FY13 RUN implemented:

- A cloud based technology platform to manage its sales business

- salesforce.com assisting to drive world class prospecting and client follow-

up

- an ipad application to allow tracking and support of attendees at open for

inspections

↘ Over the course of FY14, RUN plans to implement further enhancements to

provide RUN sales agents with greater levels of administration support to

enable them to improve productivity and client service.

↘ There are three key initiatives underway to support growth of the sales division: (continued)

Recognition of RUN’s IT and innovation contribution to the real estate industry

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Sales growth

3. RECRUITMENT

↘ Over recent times the real estate market has strengthened from post GFC

levels in terms of sales values and the volume of sales transactions

↘ RUN now feels the time is right to actively grow this division of the business and

is now recruiting real estate sales agents

↘ There is a ‘build phase’ for sales agents:

↘ An investment is required in the early stages to produce profit contributing

agents.

↘ There is a time lag between appraising a property and it coming up for sale.

Increased appraisals completed over the past 12 months should contribute to

revenue growth in the FY14 period.

↘ There are three key initiatives underway to support growth of the sales division: (continued)

Phase I – Induction Phase II - Building Phase III - Profit

0 to 3 months, to establish, induct and train a new sales agent

3 to 12 months, agent is building pipeline. Unlikely to cover fixed costs.

12 + months, agent is contributing to profits and rent roll growth

3 4

9 5

5

5 7

11

11

June 2012 June 2013 August 2013

Phase I agents Phase II agents

Phase III agents

NUMBER OF RUN SALES AGENTS

Total

15

Total

20

Total

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RUN Property summary

↘ RUN Property is Australia’s largest independently owned real estate

business

↘ Its property management business has significant recurring revenue

streams, delivering stable and reliable revenues and profits

↘ The rent roll is valued indicatively at $60M but due to accounting

standards the rent roll is not on the balance sheet

↘ In FY13 the RUN Property business contributed $7.0M to profits with

revenues of $26.1M

↘ The company believes there is an opportunity to significantly increase

revenues by investing in its sales division. This is likely to deliver

increased brand visibility, rent roll growth and profit growth over time.

↘ During the last quarter of FY13 and post year end, RUN commenced

the expansion of its sales division and increased its sales team by

nearly 70% from June 2012.

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Agentplus Pty Ltd Section 3

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Agentplus overview

BUSINESS DESCRIPTION

↘ There are approximately 10,000 real estate agencies in Australia

servicing approximately 1.2M investment properties

↘ The typical agent is owned and operated by Principals who spends

the majority of time focussed on listing and selling real estate. In their

spare time they are juggling everything from reconciling trust

accounts to backing up their computer systems

↘ Agentplus was established to assist real estate principals to

outsource their technology and administration ‘back-end’ to allow

them to focus on their core skillset, being selling real estate. It

charges a fee for service to agents for providing this function.

↘ There are currently 26,000 landlords utilising this platform, including

RUN Property and a number of leading real estate firms

↘ To date, Agentplus has grown through word of mouth with little sales

or marketing activity

↘ The company conducted a review of this business throughout FY13

and plans to invest in growth in FY14.

↘ Agentplus developed a range of mobile and web based applications

over the period, enabling agents to access the Agentplus system in

the field

↘ Agentplus contributed $777K to group EBITDA for the FY13 period.

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Growth opportunity

GROWTH OPPORTUNITIES

↘ There are two key areas of focus for Agentplus:

1. Provide cloud based IT systems so agents don’t have to worry about managing an IT environment

2. Deliver a range of outsourced services so agents don’t have to worry about managing non-

competitive functions in their business. eg. Invoice processing.

↘ In other industries it is common place for organisations to outsource their IT, payroll and various accounting

functions.

↘ It is this type of solution Agentplus offers to the industry.

↘ During FY14 Agentplus will invest in sales and marketing resources to grow its client base.

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Maintenance Matcher Section 4

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Introducing Maintenance Matcher

MARKET OPPORTUNITY

↘ RUN estimates that there is in excess of $1B spent by landlords across Australia on general maintenance of

investment properties

↘ RUN alone sub-contracts approximately 50,000 maintenance jobs per annum

↘ Typically these works are coordinated by property managers and completed by small local maintenance providers

↘ The challenges with the current model are:

- Property managers spend a lot of time trying to access cost competitive, quality maintenance providers

- Maintenance providers spend a lot of time quoting and trying to gain access to tenanted properties which

increases their costs

- Landlords may not always get the most competitive price

SOLUTION

↘ Maintenance Matcher has developed proprietary technology to match the right job with the right provider in the most

time efficient manner for both property manager and supplier

↘ Suppliers will register with Maintenance Matcher, pay a subscription fee and receive opportunities to quote on and

complete maintenance jobs.

↘ With the use of streamlined in-house built technology the property manager can advertise maintenance jobs which will

reach the suppliers matching a set criteria via SMS, email or both.

↘ The supplier can accept opportunities to quote or complete the work at their leisure. Those first to accept the

opportunity will be given the detail to then complete the job.

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Maintenance Matcher launch plans

STRATEGY DEVELOPMENT

↘ Development of the Maintenance Matcher

business plan and technology specification.

STAGE 1 IT DEVELOPMENT

↘ Development of the Stage 1 technology that

will enable suppliers and Agentplus clients to

use the service

LAUNCH TO AGENTPLUS

↘ Phased launch of the service to Agentplus

clients is anticipated to occur in the first half

of FY14

STAGE 2 IT DEVELOPMENT

↘ Planned development of Phase II functionality

will increase features and enable the launch

to mass market

CONSUMER LAUNCH

↘ Once established, Maintenance Matcher

plans to launch to the Mass Market

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In summary

↘ The RUN Corp Ltd (soon to be named Real Estate Corp Ltd, subject to shareholder

approval) group of companies all provide unique and progressive services within the

real estate industry

↘ Current revenues predominantly consist of recurring revenues making them reliable and

predictable

↘ There are significant opportunities to leverage fixed costs, skills, technology and

infrastructure to deliver future shareholder value, with the key opportunities being;

↘ RUN Property – delivering growth though new real estate sales agents

↘ Agentplus – by investing in sales and marketing activities to achieve growth

↘ Maintenance Matcher – leveraging 50,000 maintenance jobs from RUN and

subsequently Agentplus and mass market clients.

↘ The group has sustainable debt levels, and

↘ Is generating positive cashflows (cashflows from operating activities less cash flows

from investing activities)

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Appendix 1 – Non-IFRS information

The following notes provide further details of certain non-IFRS financial measures used throughout this

presentation:

EBITDA is reconciled from Profit Before Tax flow by adjusting for Depreciation, Amortisation, Finance

costs and interest income.

EBITDA before re-financing gain is calculated by adjusting EBITDA (as above) for the re-financing gain

in FY12.

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FY09 FY10 FY11 FY12 FY13

Profit/(loss) before income tax (6,544) (5,546) (5,608) 14,079 2,335

Depreciation 574 587 596 231 339

Amortisation 5,540 5,702 5,526 2,826 1,456

Finance costs 3,136 3,569 3,608 2,699 1,450

Interest income (102) (81) (79) (94) (63)

EBITDA 2,604 4,231 4,043 19,741 5,517

Re-financing gain - - - (14,981) -

EBITDA before refinancing gain 2,604 4,231 4,043 4,760 5,517For

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Appendix 1 – Non-IFRS information

PBT excluding re-financing gain is calculated by adjusting Profit/loss before income tax for the re-

financing gain in FY12.

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FY09 FY10 FY11 FY12 FY13

Profit/(loss) before income tax (6,544) (5,546) (5,608) 14,079 2,335

Re-financing gain - - - (14,981) -

PBT (excluding re-financing gain) (6,544) (5,546) (5,608) (902) 2,335

Net Debt is reconciled as follows:

FY09 FY10 FY11 FY12 FY13

Current interest bearing borrowings 1,006 - - 6,923 1,000

Non current interest bearing borrowings 35,883 35,700 35,571 13,375 13,425

Cash on hand (3,114) (1,723) (1,350) (3,535) (3,074)

Net debt 33,775 33,977 34,221 16,763 11,351

Movement in net debt 202 244 (17,458) (5,412)

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