Ann: Response to an ASX Query - Appendix 4C , page-6

Apologies for my late reply.

I think that if they can institute a good turnaround, of course this stock can take off.

At the end of the day it all comes down to understanding the revenue streams within a property management business / real estate business. Property Management or "Rentals" are the back bone and sometimes the ONLY income stream for a real estate agency, no matter how large the agency, big or small, private or listed. A sales book is only as good as the last sale and the last sales person (sales people tend to be a dime a dozen in the industry) but property management sees it thru.

Also - a large part, significant part of the balance sheet is the management / rent roll assets - in Melbourne alone, these are often valued at 3 - 3.5 times annual income for a well managed property down to 2 - 2.5 times for poorly managed property.

That is, if the agency receives say the following: On a $400 a week home, 7% management fee, thats $1456 per annum times 3.5, thats an asset value of $5096.00 - these figures are based on an ideal world, top rents, fees and other factors - don't quote me!

As for the rental market - its strong. We only have to look at the influx of arrivals into the country and the major capital cities. Rents are still at a good rate with plenty of tenants still in the market. As rents rise, of course the agency percentage of commission rises in proportion, causing a sort of "bracket creep" effect - in the agent and owners favour - owner gets more rent, the agent gets a greater $ return.

WWM needs to continue to provide a high standard of service to their Landlords and Tenants to ensure that they retain their managements and grow their managements.

The same can be said for similar company, Run Corp ASX:RNC - it too is a similar company but run solely focus on the management and leasing of property.

These are great businesses generally from a cash-flow and asset base - but as we have witnessed sometimes the market under values them, not for any other reason than perhaps they don't understand them?

This is not advice & does not constitute advice. This is solely the opinion of the writer/author.