Trading Statement

Plus500 Limited

10 July 2023

 

10 July 2023                                                                                                                                             

Plus500 Ltd.

("Plus500", the "Company", or together with its subsidiaries the "Group")

Half Year 2023 Trading Update

Strong financial and operational performance driving shareholder returns

Continued strategic progress

FY 2023 expected to be in line with current market expectations

Plus500, a global multi-asset fintech group operating proprietary technology-based trading platforms, today issues the following trading update for the six months ended 30 June 2023^[1]. 

Another strong operational performance was delivered in H1 2023, supported by Plus500's continued ability to attract and retain higher value customers, driving higher lifetime values. This strong performance was achieved despite lower volumes across the wider financial markets during the period. Accordingly, the Board of Directors of the Company (the "Board") expects that Plus500's revenue and EBITDA for FY 2023 will be in line with current market expectations[2].

Continued strong operational and financial performance

Plus500 made good progress against its strategic initiatives, delivering another period of strong operational and financial performance during H1 2023, benefiting also from the Group's operations in the US. This performance was supported by the positive momentum achieved in recent years, the growing breadth of Plus500's product offering, deepening customer relationships and the proven strength of the Group's market-leading proprietary technology.

Financial and operational highlights (unaudited)

	H1 2023	H2 2022	Change %
Revenue	$368.5m	$321.2m	15%
EBITDA[3]	$174.1m	$148.5m	17%
EBITDA Margin	47%	46%	2%

Revenue for the period was $368.5m, comprising of $346.2m in trading income and $22.3m in interest income, which is also included within EBITDA3 for the period, including revenue of $160.6m in Q2 2023 (Q2 2022: $240.5m). Customer Income^[4], a key measure of the Group's underlying performance, was $304.3m in H1 2023 (H2 2022: $299.8m), including $146.5m in Q2 2023 (Q2 2022: $151.8m), with Customer Trading Performance^[5] of $41.9m in H1 2023 (H2 2022: $21.4m), including $(8.2m) in Q2 2023 (Q2 2022: $88.7m).

The Group successfully onboarded 50,449 New Customers^[6] during H1 2023 (H2 2022: 49,274), including 22,248 in Q2 2023 (Q2 2022: 23,535). The Group's base of Active Customers^[7] was 175,762 during H1 2023 (H2 2022: 177,946), including 122,833 in Q2 2023 (Q2 2022: 145,506).

Strategic progress

Plus500 made further strategic progress by entering new markets and launching new products during the first six months of FY 2023. This strategic progress enabled the Group to continue diversifying its revenue streams, geographic footprint and business model and has further strengthened its status as a market leading, global multi-asset fintech group, delivering an exceptional service for the Group's customers globally. 

Further optimising Plus500's growing position in the substantial futures market in the US

Excellent traction was made during the period in the substantial US futures market where the Group is targeting a number of major growth opportunities. 

B2B Opportunity

The Group continued to develop its strategic position in the US as a market infrastructure provider, supporting institutional clients with brokerage-execution and clearing services. This B2B offering will continue to be driven by the Group's robust financial position, its highly differentiated technological capabilities, ongoing operational investment and its position as a full clearing member of the CME Group exchanges and the Minneapolis Grain Exchange (MGEX). The Group is currently in the process of obtaining clearing memberships from additional exchanges.

B2C Opportunity

To leverage the significant US retail trading opportunity, and following the launch of 'TradeSniper' in Q3 2022, Plus500 recently launched 'Plus500 Futures', a new intuitive proprietary futures trading platform specifically tailored for the sizeable US retail trading market, both on iOS and Android. This new offering will enable the Group to further benefit from the continued demand for and increase in accessibility to the futures market for the US retail trading community.

The launch of 'Plus500 Futures' follows the launch of another new offering, 'event-based contracts', now available on TradeSniper's iOS and Android applications. This new offering allows trading in sizable contracts tailored for the retail community over the world's most trusted benchmark equity indices, commodities, and foreign currency futures markets. This represents an innovative trading solution which Plus500 has introduced to customers in the growing futures retail market.

'Plus500 Futures' and 'TradeSniper' uniquely offer customers a fully holistic solution of onboarding, depositing and trading in futures contracts, and will continue to be developed by Plus500 to provide a consistent, best-in-class experience for its customers.

Significant progress made in the high growth UAE market

A new regulatory licence in the high growth UAE market was obtained during the period, further expanding Plus500's geographic footprint. The Group's operation in the UAE is already fully functioning and the Group is pleased to be in line with its strategic roadmap driven by the rapid progress made in developing Plus500's market position in this significant market.

Major growth opportunity in Japan

Plus500 made further progress in broadening the Group's geographic footprint within the substantial Japanese trading market through the development and the expected upcoming launch of its new proprietary trading platform tailored specially for the Japanese market.

Plus500 recognises Japan as one of its key strategic markets and will apply there the Group's financial and technological strength to scale and develop its local position. Accordingly, the Group intends to allocate substantial financial and personnel resources on an on-going basis, in order to maximise these opportunities in the medium term.

More than $240m returned to shareholders so far in FY 2023, supported by Plus500's robust financial position

Plus500's financial position remains robust and the Company continues to be debt-free since inception. The Group maintains healthy cash balances, with approximately $850m held in cash as of 30 June 2023.

With the Group's strong financial position in mind, and reflecting the Board's confidence in the future prospects of Plus500 and its view of the current value of the Company's shares, during the first half of the year, the Company has repurchased 11,485,961 shares, at an average price of £14.93, for a total cash consideration of $214.1m.

In line with the Company's capital allocation and shareholder returns policy, out of the 11,485,961 shares repurchased during the period, 7,327,605 shares were acquired by the Company on 13 June 2023, representing approximately 8.2% of the Company's issued share capital as at such date (excluding treasury shares, which are not entitled to dividends and have no voting rights at the Company's general meetings), for a total cash consideration of $127.5m.

Looking ahead, and further demonstrating the Board's confidence in the future prospects of Plus500, the Company announced on 19 June 2023 that it had convened an EGM to be held on 24 July 2023 for the purposes of authorising the Company to make additional purchases of its shares, up to 10% of the Company's issued share capital.

Outlook - Plus500 remains well positioned to deliver sustainable growth

The Board remains highly confident about the Group's performance for FY 2023, and therefore anticipates that Plus500's revenue and EBITDA for the current financial year will be in line with current market expectations.

Plus500 will continue to pursue several major growth opportunities, through continued investments in its proprietary trading platforms, technological marketing capabilities and by actively targeting attractive acquisition opportunities. Plus500 remains well-positioned to deliver sustainable growth and value for its shareholders over the medium to long term, harnessing its position as a global multi-asset fintech group.

The Company will publish its half-year results for the six months ended 30 June 2023 on 14 August 2023.

David Zruia, Chief Executive Officer, commented:

"Plus500 continued to perform strongly in the first half of 2023, building on the positive momentum achieved in recent years, leveraging our differentiated, market-leading, proprietary technology and benefiting from our increasingly diversified revenue streams, broadened product offering, deep customer relationships and the structural growth drivers in our end markets. We made significant progress in optimising our growth opportunities in the US and Japan, where we continue to make substantial investments to take advantage of the opportunities ahead.  Earlier this year the Group obtained a license in the United Arab Emirates, demonstrating further progress in diversifying our geographic footprint across high growth markets.

"In addition, we continued to deliver outstanding levels of returns to our shareholders during the period, through $214.1m in share repurchases and the $29.9m dividend payment due tomorrow, on 11 July 2023, which emphasise the Board's view of the current value of the Company's shares. Our cash generative earnings model, combined with our continued strategic, operational and financial position, means that Plus500 is well placed to deliver sustainable growth in the medium to long term, enabling the Group to deliver further shareholder value in the future."

For further details
Plus500 Ltd.
Elad Even-Chen, Chief Financial Officer	[phone] [e-mail]
Dentons Global Advisors
James Melville-Ross James Styles Leah Dudley	[phone] [e-mail]

About Plus500

Plus500 is a global multi-asset fintech group operating proprietary technology-based trading platforms. Plus500 offers customers a range of trading products, including OTC ("Over-the-Counter" products, namely Contracts for Difference (CFDs)), share dealing, as well as futures and options on futures. The Group retains operating licences and is regulated in the United Kingdom, Australia, Cyprus, Israel, New Zealand, South Africa, Singapore, the Seychelles, the United States, Estonia, Japan and the UAE and through its OTC product portfolio, offers more than 2,500 different underlying global financial instruments, comprising equities, indices, commodities, options, ETFs, foreign exchange and cryptocurrencies. Customers of the Group can trade its OTC products in more than 50 countries and in 30 languages. Plus500 does not permit customers located in the US to trade its OTC products. Plus500 does not utilise cold calling techniques and does not offer binary options. Plus500's trading platforms are accessible from multiple operating systems (Windows, iOS and Android) and web browsers. Customer care is and has always been integral to Plus500, as such, OTC customers cannot be subject to negative balances. A free demo account is available on an unlimited basis for OTC trading platform users and sophisticated risk management tools are provided free of charge to manage leveraged exposure and stop losses to help customers protect profits, while limiting capital losses. Plus500 shares have a premium listing on the Main Market of the London Stock Exchange (symbol: PLUS) and are a constituent of the FTSE 250 index. www.plus500.com.

Forward looking statements

This announcement contains statements that are or may be forward-looking statements. All statements other than statements of historical facts included in this announcement may be forward-looking statements, including statements that relate to the Group's future prospects, developments and strategies. The Company does not accept any responsibility for the accuracy or completeness of any information reported by the press or other media, nor the fairness or appropriateness of any forecasts, views or opinions express by the press or other media regarding the Group. The Company makes no representation as to the appropriateness, accuracy, completeness or reliability of any such information or publication.

Forward-looking statements are identified by their use of terms and phrases such as "believe", "targets", "expects", "aim", "anticipate", "projects", "would", "could", "envisage", "estimate", "intend", "may", "plan", "will" or the negative of those, variations or comparable expressions, including references to assumptions. The forward-looking statements in this announcement are based on current expectations and are subject to known and unknown risks and uncertainties that could cause actual results, performance and achievements to differ materially from any results, performance or achievements expressed or implied by such forward-looking statements. Factors that may cause actual results to differ materially from those expressed or implied by such forward looking statements include, but are not limited to, those described in the Risk Management Framework section of the Company's most recent Annual Report. These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of the Group and the environment in which it is and will operate in the future. All subsequent oral or written forward-looking statements attributed to the Company or any persons acting on its behalf are expressly qualified in their entirety by the cautionary statement above. Each forward-looking statement speaks only as at the date of this announcement. Except as required by law, regulatory requirement, the Listing Rules and the Disclosure Guidance and Transparency Rules, neither the Company nor any other party intends to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.

---

[1] All figures for the period ended 30 June 2023 included in this trading update are unaudited 

[2] Market expectations based on compiled analysts' consensus forecasts, which can be found on the Investor Relations section of the Company's website

[3] EBITDA - Revenue (trading income and interest income) minus operating expenses plus depreciation and amortisation

[4] Customer income - Revenue from OTC Customer Income (customer spreads and overnight charges) and Non-OTC Customer Income (commissions from the Group's futures and options     

  on futures operation and from 'Plus500 Invest', the Group's share dealing platform)

[5] Customer Trading Performance - Gains/losses on customers' trading positions

[6] New Customers - Customers depositing for the first time

[7] Active Customers - Customers who made at least one real money trade during the period

 

END