Termination of Merger, Dividend and Share Buyback

RNS Number : 5661G

Plus500 Limited

23 November 2015

 

Plus500 Ltd.

("Plus500", "the Company" or "the Group")

Plus500 announces termination of Merger Agreement with Playtech, intended declaration of an Interim Dividend of $0.2121 per share and Share Buyback programme

Further to the determination by Playtech PLC that it will be unable to obtain FCA approval before 31 December 2015, the Company and Playtech agreed to terminate the Merger Agreement. The Board of Plus500 today announces its plans for an independent future. The Board of Plus500 also announces its plan to declare an interim dividend of $0.2121 per share in respect of the 6 month period to 30 June 2015 and share buyback programme.

·   Trading continues to be strong.  The trend of customer numbers and revenues announced in the half-year results and the Q3 trading update has continued through Q4. 

·   Regulatory compliance capability has been strengthened.  The Group has continued to invest in strengthening its management capabilities, particularly in regulatory compliance.  The Group is not subject to restrictions imposed by any of its regulators.

·   Product innovation continues.  The Group continues to enhance the range of product and trades available to customers including the recently launched proprietary Apple Watch app.  The Group recently commenced trading of CFDs on options and these have proved to be popular with customers.  Further innovations are under development.

·   The Group remains strongly cash generative.  As announced in the half year results, the amount of cash held at 30 June 2015, excluding client balances which are held is segregated accounts, was $95m and further cash has been generated in line with the strong trading.

·   Dividend policy confirmed. In the light of the positive trading and the Board's assessment of the prospects for the future of the Group, the Board re-confirms its base dividend pay-out ratio of 60% of retained profits.

·    Interim Dividend of $0.2121 per share announced.  Under the terms of the proposed acquisition by Playtech the Board agreed not to declare an Interim Dividend for 2015.  Following the termination of the merger agreement the Board is pleased to announce an Interim Dividend of $0.2121 per share (representing $24.37m). The Company will issue a separate announcement shortly concerning the record and payment date for this Interim Dividend. It is intended the record date will be in December 2015.

·   In addition, the Board has approved a programme to buyback up to $20 million of the Company's shares. Share purchases will take place in open market transactions and may be made from time to time depending on market conditions, share price, trading volume and other factors.  Such purchases will be made in accordance with all applicable laws and regulations.  The buyback programme, which is expected to commence at the discretion of the Company, does not require Plus500 to acquire a specific number of shares, and may be suspended from time to time or discontinued.  The buyback programme will be funded from available working capital.

·    The Board still expects revenue for the whole of 2015 to be ahead of 2014 but with profitability still not expected to match that of last year.

Gal Haber, Chief Executive Officer of Plus500 commented:

"Following the agreement with Playtech that the merger between the companies will not proceed, we can confirm that our business is in good shape for a successful future as an independent company. 

Plus500 remains a growing, highly profitable and cash generative company with strong momentum in an expanding international market.  We have adopted a "business as usual" policy during the lengthy acquisition timetable and continued to invest in our marketing, technology and regulatory operations during this period. As a result we are very confident that as an independent business we are well positioned to continue to deliver significant returns for shareholders including the declaration today of an intended interim dividend of $0.2121 per share and share buyback programme."  

Enquiries

Plus500
Elad Even-Chen, Finance Director, VP Business Development and Head of Investor Relations	[phone] [e-mail]
Liberum
Clayton Bush/Christopher Britton/Josh Hughes	[phone]
MHP Communications
Reg Hoare/Tim Rowntree/Kelsey Traynor	[phone] [e-mail]

About Plus500

Company website: www.plus500.com

Plus500 has developed and operates an online trading platform for retail customers to trade CFDs internationally over more than 2000 different underlying global financial instruments comprising equities, ETFs, foreign exchange, indices and commodities. The Company enables retail customers to trade CFDs in more than 50 countries. The trading platform is accessible from multiple operating systems (Windows, smartphones (iOS, Android and Windows Phone) and tablets (iOS, Android and Surface)) and the internet. The Directors believe that the success of the Company to date has been primarily due to the proprietary technology it has developed and continues to develop to support the trading platform. The trading platform has been designed to be as intuitive and easy to use as possible. The trading platform has been localised into over 31 languages. The Directors believe that this emphasis on technology, together with the Company's targeted online marketing strategy, has helped to differentiate the Company from its competitors.

 

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