Franchisees hard to find

Mortgage Choice, one of the largest aggregators in the mortgage broking space, at its annual meeting yesterday emphasised that its investment plans - which aim to recruit more franchisees and thus to reach more customers - would step up the company's earnings growth.

Managing director Paul Lahiff said the broker expected to grow its EPS between five and 10 per cent in the year to June 2008 and to then provide "faster than 10 per cent growth in fiscal 2009 and 2010". The company reported earnings per share growth of nine per cent in the 2007 financial year and a profit of $19.6 million.

Lahiff included a similar slide in the company's presentation of its 2007 profit in late August though this detail was overlooked in reporting on the company's drift in market share (to 4.5 per cent of all new loans) over the prior year.

The company did explain at the time its plans to turn the business around with a 15 per cent increase in advertising budget and new national positions such as head of sales and national head of recruitment.

Peter Ritchie, chair of Mortgage Choice, said the market for recruitment of franchisees was "challenging" and noted that the sale of existing franchises currently exceeds the sale of new licences.