Trading Update and Directorate Change

RNS Number : 5154K

Plus500 Limited

05 January 2021

 

5 January 2021       

Plus500 Ltd.

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

 Year End Trading Update and Directorate Change

Year End Trading Update

Plus500, a leading technology platform for trading Contracts for Difference ("CFDs") internationally, today issues the following trading update for its financial  year ended 31 December 2020. 

The Company delivered a record performance in FY 2020, with revenue for the year expected to be approximately $87 2 m (Q4 2020: approximately $9 1 m), ahead of the Board's expectations [1] , as outlined in the Company's Q3 2020 Trading Update issued on 27 October 2020.

Driving Customer Income[2] remains the Company's core focus, with record levels achieved during FY 2020 of approximately $997m (Q4 2020: approximately $200m). Customer Trading Performance[3] was approximately $(125m) during the year (Q4 2020: approximately $(109m)). The Company continues to expect that the contribution from Customer Trading Performance will be broadly neutral over time.

The Company's strong performance during FY 2020 demonstrates once again its exceptional ability to respond to news events and volatile financial markets while maintaining a sophisticated, efficient and responsible business model. This performance, driven by record platform usage, was achieved despite the unprecedented and uncertain market conditions experienced throughout the year.

Plus500's performance in FY 2020 was also evidenced by the record number of Active Customers[4] using the platform during the year, with a much reduced rate of customer churn from the prior year.

Supported by the Company's market-leading technology, Plus500 on-boarded a record number of New Customers [5] in FY 2020. During Q4 2020, both client deposits and the number of New Customers more than doubled from   Q4 2019 , and the number of New Customers was also higher than the level achieved in Q3 2020. This was driven in Q4 2020 by sustained levels of the Company's already significant investment in its marketing technology capabilities to help attract New Customers. The heightened investment was made in light of the clear and substantial opportunities available in Q4 2020 to on-board New Customers at an anticipated attractive return-on-investment.

Driven by this short-term investment to capture long term growth and value, FY 2020 EBITDA [6] is expected to be approximately $515m, broadly in line with the Board's expectations [1], as outlined in the Company's Q3 2020 Trading Update.

Given the Company's performance in 2020, building on the momentum of previous years, and its strong balance sheet, t he Board remains confident about the outlook going forward. The Group continues to drive a number of initiatives which will produce sustainable growth and cash generation over the medium to long term . These initiatives, to be delivered through continued organic growth and potential acquisitions, include expanding into new markets and extending into new product lines.

The Group will publish its preliminary results for the financial year ended 31 December 2020 on 17 February 2021.

Directorate Change

The Company also announces today that Gal Haber, one of Plus500's co-founders and its former CEO, has notified the Board of his intention to step down from his executive position as a Managing Director and from his position as a Director of the Board, with immediate effect. Mr Haber will continue to provide consultancy services to the Company in the future.

A selection process is being carried out by the Board, with a view to recruiting additional non-executive directors, to broaden the range of the Board's experience and continue to diversify the composition of the Board.

Penny Judd, Chairman of Plus500, commented on this Directorate Change:

"The Board would like to thank Gal for his significant contribution to the establishment and development of Plus500, since the Company's inception in 2008. Gal played a pivotal role as CEO in leading Plus500 through a successful IPO in 2013. Since then, the Company has built a strong operational and financial track record, with its market capitalisation increasing from approximately $200m at that time to approximately $2 billion as at the end of FY 2020, along with over $1 billion paid in dividends and share buybacks to the Company's shareholders. We wish Gal well for the future and we look forward to working with him, on a consultancy basis, going forward."

David Zruia, Chief Executive Officer of Plus500, commented on the Company's performance in FY 2020:  

"In the context of an unprecedented and uncertain market environment, 2020 was an outstanding year for Plus500, during which we delivered a record financial and operational performance. The positive momentum built up during 2020 was driven by the strength and differentiation of our proprietary technology. This was supported by the expertise of our people, who ensured that our customers received a consistently high quality service during the year, and we are extremely grateful to our people for their continued hard work and commitment.

"We continued to significantly invest in all elements of our technology during the year, with a view to driving its scale, agility and attractiveness for customers. In addition, given our robust compliance systems and our regulatory know-how, we are well prepared for the regulatory changes being introduced in 2021, including those being adopted as a result of last month's Brexit agreement, and we are well positioned to deliver new products and services for our customers. Given these factors, the Board remains confident about the outlook for Plus500."

For further details Plus500 Ltd Elad Even-Chen, Chief Financial Officer Rob Gurner, Head of Investor Relations [phone] [phone] [e-mail] MHP Communications Reg Hoare, Rachel Mann, Pete Lambie [phone] [e-mail]

About Plus500

Plus500 operates a proprietary technology platform for individual customers to trade CFDs internationally. The Group offers more than 2,500 different underlying global financial instruments, comprising equities, indices, commodities, options, ETFs, foreign exchange and cryptocurrencies. Customers of Plus500 can trade CFDs in more than 50 countries and in 32 languages. The trading platform is accessible from multiple operating systems (Windows, iOS, Android and Surface) and web browsers. Plus500 retains operating licences and is regulated in the United Kingdom, Australia, Cyprus, Israel, New Zealand, South Africa, Singapore and the Seychelles. 

Customer care is and has always been integral to Plus500, as such, customers cannot be subject to negative balances. A free demo account is available on an unlimited basis for 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 does not utilise cold calling techniques and does not offer binary options.  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

The   information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation ("MAR"). Upon the publication of this announcement via Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain. 

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 Company'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 factors.  These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of such entity and the environment in which each 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.

 

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[1] On 27 October 2020, the Board expected FY 2020 revenue and EBITDA to be in line with company-compiled consensus forecasts at that time of $829.2m and $520.5m, respectively

[2] Customer Income - Revenue from customer spreads and overnight charges

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

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

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

[6]EBITDA - Earnings before interest, taxes, depreciation and amortisation

 

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