20 February
2024
Plus500
Ltd.
("Plus500", the "Company" or
together with its subsidiaries the "Group")
Preliminary
Results for the
year ended 31 December 2023
FY 2023 results significantly
ahead of market expectations
Significant additional
shareholder returns of $175m announced today
Plus500, a global multi-asset
fintech group operating proprietary technology-based trading
platforms, today announces its preliminary unaudited results for
the year ended 31 December 2023.
David Zruia, Chief Executive Officer of Plus500,
commented:
"Three years ago, Plus500 presented
its new strategic plan to become a global, multi-asset fintech
group, by expanding into new markets, developing new products and
deepening relationships with customers.
2023 saw further progress against
all three strategic objectives: we expanded
our US futures businesses, launched a new retail FX OTC trading
platform in Japan and extended our portfolio of global regulatory
licences to 13. We expanded our core product offering
to include a share dealing platform, and a new
line of business offering futures and options on futures. Our
efforts to deepen customer relationships were enhanced by our
market-leading technology, and we now have over 26 million customers registered on our platforms. During
the period, we achieved a record high average deposit per active
customer reflecting our on-going focus on higher value customers
and the intuitive nature and reliability of our market-leading
technology.
All of this strategic progress has
led to our FY 2023 results being significantly ahead of market
expectations and today we are pleased to announce additional shareholder
returns of $175.0m,
comprising $100.0m in new share buyback programmes and $75.0m of dividends."
Financial highlights
|
H2 2023*
|
H2
2022*
|
Change %
|
FY 2023*
|
FY
2022
|
Change %
|
Revenue
|
$357.7m
|
$321.2m
|
11%
|
$726.2m
|
$832.6m
|
(13%)
|
EBITDA[1]
|
$166.4m
|
$148.5m
|
12%
|
$340.5m
|
$453.8m
|
(25%)
|
EBITDA Margin %
|
47%
|
46%
|
2%
|
47%
|
55%
|
(15%)
|
Cash balance at period
end
|
$906.7m
|
$930.2m
|
(3%)
|
$906.7m
|
$930.2m
|
(3%)
|
*Unaudited
Robust financial performance enabled by Plus500's strong
market position
·
Group revenue was $726.2m, comprising trading
income of $674.3m and interest income of $51.9m
·
EBITDA was $340.5m, with an EBITDA margin of
47%
·
Basic Earnings Per Share (EPS) was
$3.17
·
70% of the Group's costs were variable in nature
(FY 2022: 70%) providing it with a significant competitive
advantage, and highlighting Plus500's lean and flexible business
model
·
The Company's balance sheet remained extremely
strong with cash balances of $906.7m as at 31 December 2023
with no loans or debt
Significant shareholder returns of $175.0m announced
today
·
New shareholder returns of $175.0m announced
today, in line with the Group's clear and disciplined capital
allocation framework, reflecting its enduring financial strength
and the Company's Board of Directors (the
"Board") continued confidence in its
prospects
·
These shareholder returns comprise new share
buyback programmes of $100.0m, as well as total dividends of
$75.0m
·
During FY 2023, Plus500 announced approximately
$350m of total shareholder returns, comprising share buyback
programmes of $257.5m, including $127.5m through the
repurchase of shares executed on 13 June 2023, and total
dividends of $90.0m
·
Since the commencement of Plus500's initial share
buyback programme in 2017 and up to 31
December 2023, the Company has purchased 36,651,165 ordinary
shares, amounting to a total of $0.6bn, excluding the amount
announced today, at an average share price of £13.52
Operational highlights
|
H2 2023
|
H2
2022
|
Change %
|
FY 2023
|
FY
2022
|
Change %
|
New Customers[2]
|
40,495
|
49,274
|
(18%)
|
90,944
|
106,549
|
(15%)
|
Active Customers[3]
|
158,846
|
177,946
|
(11%)
|
233,037
|
280,769
|
(17%)
|
AUAC[4]
|
$1,487
|
$1,527
|
(3%)
|
$1,489
|
$1,481
|
1%
|
ARPU[5]
|
$2,252
|
$1,805
|
25%
|
$3,116
|
$2,966
|
5%
|
Strategic progress in new markets
·
Strong progress made in the US futures market, as
evidenced by the increase in new customers in both B2B
(Institutional) and B2C (Retail) businesses, as well as
through additional memberships being
secured with the Futures Industry Association (FIA) and
Eurex
·
In Japan, the Group launched a localised trading
platform for retail traders which is
gaining good traction
·
During 2023, Plus500 added two new licences, in
the UAE and the Bahamas, bringing the global portfolio of
regulatory licences to 13
New
products and technology underpinning the Group's
growth
·
Launched 'Plus500 Futures', a new proprietary
trading platform designed for the US retail market to trade in
futures, bringing innovative trading solutions to the futures
market
·
Plus500 rolled out AI and big data models to
develop new retention technologies supported by enhanced customer
engagement methodologies
Significant resources committed to improving customer
retention
·
Significant customer progress was demonstrated
during FY 2023 with a record ARPU achieved of $3,116 (FY 2022:
$2,966)
·
Customer deposits increased to
$2.4 billion (FY
2022:
$2.3 billion), with
the average deposit per Active Customer growing to a record high of approximately $10,300 (FY
2022: approximately
$8,000)
·
In FY 2023, over 87% of the Group's OTC
revenue was generated from customers
trading on mobile or tablet devices (FY 2022: over
85%). This highlights Plus500's industry leadership when it
comes to mobile-first services and its relentless focus on
innovation
Outlook
·
Given Plus500's significant strategic,
operational, and financial progress over recent years, and the
Group's robust financial position, the Board remains confident
about the Group's future prospects
For further details
Plus500 Ltd.
|
|
Elad Even-Chen, Chief
Financial Officer
Owen Jones, Head of Investor
Relations
|
+972 4 8189503
+44 (0) 7551 654208
ir@Plus500.com
|
Dentons Global Advisors
|
|
James
Melville-Ross
James Styles
Methuselah
Tanyanyiwa
|
+44 (0)20 7664 5095
Plus500@dentonsglobaladvisors.com
|
Investor and analyst audiocast
Plus500 will host an audiocast for
investors and analysts at 9.00 a.m. UK time today, which can be
accessed via the following link:
https://www.investis-live.com/plus500/65ba5db777117a0c005e4656/rtjwzz.
The audiocast can also be accessed by dialling +44 20 3 936 2999
and using the following access code: 725869. The presentation materials and a
recording of the audiocast will be available at
https://investors.plus500.com/Reports/Presentation.
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, the UAE and the Bahamas 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 60
countries and in 30 languages.
Plus500's trading platforms are
accessible from multiple operating systems (iOS, Android and
Windows) 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.
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 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", "project", "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.
Review of FY 2023
Introduction
Three years ago, Plus500 formulated
its new strategic roadmap to become a global, multi-asset fintech
group supported by its proprietary technology and robust financial
position. The strategic roadmap included targets to expand into new
markets, develop new products (including non-OTC products),
services and features, and to deepen relationships with its
customers. Since then, Plus500 has evolved from being a technology
company with a leading OTC proprietary offering, to a diversified,
multi-asset global business, offering a wide range of technologies
which provides access to various financial trading products and
services in the futures and options on futures markets, as well as
the Group's share dealing platform.
The Group also continued to enhance
its existing OTC offering by harnessing its market-leading
technology and expertise in AI and big data models to improve its
customer retention efforts.
After more than a decade as a highly
successful publicly listed company on the London Stock Exchange,
Plus500 has responsibly extended its footprint through a number of
bolt-on acquisitions, deploying capital to acquire businesses in
the US futures market and in the Japanese retail OTC market,
providing the Group with an established position in these
strategic, high-growth regions.
In the US, Plus500's B2B
(Institutional)
business experienced significant growth across FY 2023 and 'Plus500
Futures', its retail trading platform, which was launched in 2023,
has experienced good levels of traction with retail traders. The
speed with which both the B2B
(Institutional)
and B2C (Retail) businesses have developed reflects the innovative and agile
nature of the Group's operational and technological capabilities.
In addition, the Group has developed enhanced trading platforms
based on new technological solutions for these businesses and
provides optimised service support, risk management and other
solutions.
In Japan, the Group has developed an
OTC FX localised proprietary trading platform for retail traders,
which went live in September 2023 and is progressing
well.
Focus on higher value customers and customer retention is
providing attractive returns to stakeholders
The Group now has more than 26
million customers registered on its platforms globally, reflecting
its continued focus on higher value customers and the strengths of
its intuitive trading platforms.
Customer deposits in FY 2023 stood
at $2.4 billion and the average deposit per Active Customer rose to
a record high of approximately $10,300 versus approximately $8,000
a year earlier. This progress demonstrates the successful nature of
the Group's strategic decision to focus on attracting and retaining
higher value customers, as well as the intuitive nature and
reliability of its market-leading technology.
Good progress made in the US futures market in both B2B
(Institutional) and B2C (Retail) businesses
The opportunities available to
Plus500 in the US futures market are substantial and the Group is
focused on delivering real value to shareholders through its
expansion efforts in this market. The US futures market is sizeable
and Plus500's technology-driven value proposition is unlocking a
material, multi-year earnings opportunity through new and growing
lines of business, spanning both B2B (Institutional) and B2C (Retail)
channels.
In an industry that has undergone
little technological change in recent years, the Group has
developed additional technological capabilities for institutional
customers and launched a unique trading platform for retail
customers. Plus500 now operates in the futures market at a
structural advantage thanks to its high-quality technology,
enabling superior customer service, attractive commercial terms and
other innovative operational capabilities new to this
market.
The Group's US futures business
performed well during FY 2023, growing revenue and customer numbers
year-on-year. The Group is focused on continuing this positive
momentum in the US and will launch new technologies to support its
already enhanced customer offerings to drive revenue and profit
growth.
New memberships secured from
Eurex Clearing AG (Eurex) and the Futures Industry Association
(FIA)
The Group is now a provider of
market infrastructure services, including brokerage-execution and
clearing services for institutional customers in the US futures
market. During 2023, the business worked to increase the number of
clearing memberships it possesses with other international clearing
houses and will continue to do so.
Since the acquisitions of Cunningham
Commodities, a regulated Futures Commission Merchant (FCM) and
Cunningham Trading Systems, a technology trading platform provider,
the Group has secured full clearing memberships with the CME Group
exchanges, as well as with the Minneapolis Grain Exchange
(MGEX).
In addition, the Group has recently
secured a clearing membership of Eurex Clearing AG, the clearing
house for the entire suite of products traded at Eurex Exchange,
the leading European derivatives exchange and one of the
largest futures and options markets globally.
This significant milestone followed the recent receipt of a primary
membership of the Futures Industry Association (FIA), the leading
global trade organisation for futures, options and centrally
cleared derivatives markets.
Obtaining further clearing
memberships will enable Plus500 to expand its network and customer
services further and, subsequently, drive revenue
growth.
US B2B (Institutional)
Opportunity
Good progress was made during the
year in increasing the number of onboarded Introducing Brokers
("IBs") and institutional clients, and efforts to onboard further
IBs will continue during 2024. Additionally, new technologies
dedicated to the needs of the B2B (Institutional) line of business
are expected to be launched later this year.
US B2C (Retail)
Opportunity
The launch of 'Plus500 Futures'
during the period marked a significant strategic step for the Group
in the US futures retail market, a market with compelling long-term
growth characteristics. Plus500 is proud to offer an omni set
solution enabling customers to be onboarded, deposit and trade with
a seamless and unified experience across all elements of the
customer journey. This significant milestone was enabled by
Plus500's technological expertise and innovative approach. 'Plus500
Futures' is live and already benefitting from the full support of
Plus500's sophisticated proprietary marketing technology, as well
as other offline marketing initiatives such as the Chicago Bulls
sponsorship. In 2024, the Group will continue to invest and support
the 'Plus500 Futures' platform by expanding its product offering
with new innovative features.
Plus500's proprietary platform in Japan went live and is
gaining good traction
Launched in September 2023,
Plus500's localised trading
platform catering to the Japanese retail market,
one of the largest retail investor markets globally, is gaining
good traction. The platform's initial offering includes
approximately 50 FX OTC pairings, and the Group aims to enhance its
local product range with additional asset classes and new trading
products. The Group recognises the significance of available
opportunities within the Japanese market and will continue to
allocate its financial and technological resources in order to
maximise this opportunity.
Global portfolio of regulatory licences increased to
13
In 2023, Plus500 obtained two new
regulatory licences, in the UAE and the Bahamas, which together
take the Group's global portfolio of regulatory licences to 13.
This global portfolio provides a significant source of competitive
advantage and inherent value for Plus500, both in a monetary and
operational sense.
The UAE represents a significant and
growing market for the Group and its business in this region is fully
operational and developing quickly. The Group's
customer base in the UAE is growing and Plus500's localised
offering is benefitting from a greater understanding of this
particular market. The Group will continue to develop its localised
offering tailored for the UAE market.
Building on its success of securing
new regulatory licences, the Group will continue to target new
regulatory licences globally, in 2024 and beyond, to support its
strategic objective of entering new markets and offering new products.
The Group's experience in obtaining new regulatory
licences leaves it extremely well positioned to execute
successfully against this objective.
Plus500 remains committed to sustainability and inclusive
access to financial trading products
Plus500's objective is to
provide trusted and intuitive access to
financial products. It seeks to achieve this by offering a broad
range of financial products, aligning its global scale with locally
tailored offering, all of which are powered by a best-in-class
proprietary technology stack.
Enabling customers to access the
financial markets through the Group's intuitive, secure and
user-friendly platforms forms a core part of Plus500's purpose-led
mission, as is the Group's focus on customer care and best in class
service. The Group has greatly enhanced its educational content
available to its customers, including the launch of an innovative
Trading Academy portal and '+Insights', a big-data, analytical tool
designed to provide access to real time and historical trends,
based on the Group's registered customer base. Plus500 also
provides customers with greater technological solutions which
enable more established customer experience and retention
benefits.
Operational and trading overview
In terms of operational performance
during FY 2023, the Group delivered a strong performance in its key
metrics despite lower trading volumes in the global financial
markets, supported by its on-going focus on attracting and
retaining higher value customers.
Customer retention has improved in
recent years, with 88% of FY 2023 OTC revenue being derived from
customers trading with Plus500 for more than a year (FY 2022: 87%),
59% from customers trading for more than three years (FY 2022: 40%)
and 29% for more than five years (FY 2022: 24%), highlighting the
increasing loyalty of its customers and their confidence in the
Plus500 trading platforms. In addition, over 87% of OTC revenue was
generated through mobile or tablet devices (FY 2022: over 85%),
highlighting the strength of the Group's mobile
offerings.
ARPU reached a record annual level
of $3,116 in FY 2023 (FY 2022: $2,966), which highlights the depth
of the Group's product offering and the quality of its intuitive
trading platforms.
In addition, customer deposits
continued to grow, with the average deposit per Active Customer
also reaching a
record annual level of approximately $10,300 (FY 2022:
approximately $8,000), highlighting the continued strong level of
confidence that customers have in Plus500 and the resilience of the
Group's trading platforms. Total customer deposits in FY 2023
increased to $2.4 billion (FY 2022: $2.3 billion).
With continued investment in
strategic markets to attract higher value customers for the long
term, AUAC was $1,489 in FY 2023 (FY 2022: $1,481). The Group continues to expect
that AUAC will rise steadily over time, as the Group's customer
profile further shifts to higher value, long term customers and as
the Group invests in attracting customers to the new trading
products in its portfolio and targeting additional high value
customers in strategic geographies.
The Group onboarded a total of
90,944 New
Customers during the year (FY 2022: 106,549). This was underpinned
by the continued investment in the Group's diversified marketing
approach, which included its sophisticated proprietary marketing
technology and a range of strategic initiatives and advertising
campaigns.
The number of Active Customers
during FY 2023 remained robust at 233,037 (FY 2022: 280,769) thanks
to the Group's customer retention, monetisation and activation
technological capabilities.
Financial Overview
Plus500 delivered another strong
financial performance in FY 2023, during which it continued to
execute against its strategic objectives whilst generating
significant cash flows and attractive returns for
shareholders.
Revenue in FY 2023 was
$726.2m (FY 2022: $832.6m), comprising trading income of
$674.3m and interest income of $51.9m. EBITDA for FY 2023 was
$340.5m (FY 2022: $453.8m) with an EBITDA margin of 47% (FY 2022: 55%). This robust
performance in FY 2023 was achieved despite lower levels of trading
activity seen across the global financial
markets during the year.
Against this challenging macro-economic
environment, Plus500 was still able to
report on financial results for FY 2023 ahead of market
expectations[6].
Customer Income[7] was $600.1m during FY 2023 (FY 2022:
$639.6m) and
Customer Trading Performance[8] was $74.2m (FY
2022: $193.0m). The Group expects that the contribution from
Customer Trading Performance will be broadly neutral over
time.
Net profit in FY 2023 was $271.4m
(FY 2022: $370.4m) and basic earnings per share was $3.17 (FY 2022:
$3.81).
For FY 2023, 70% of the Group's
costs were variable in nature (FY 2022: 70%) providing it with a
significant competitive advantage, and highlighting Plus500's lean
and flexible business model. Such a business model provides the
Group with a greater level of flexibility and agility to respond
quickly to a range of possible market conditions and, where
applicable, regulatory changes.
Total SG&A expenses were $389.8m
during FY 2023 (FY 2022: $382.2m). The main elements were marketing
technological investments of $135.4m (FY 2022: $157.8m), payment
processing costs of $40.0m (FY 2022: $44.9m), employee benefits and
other related expenses of $94.3m (FY 2022: $80.9m) and commissions
and fees of $31.2m (FY 2022: $17.0m).
Net financial expenses (income) were
$0.2m in FY 2023 (FY 2022: ($23.9m)), driven by FX gains and losses
as the Group manages its exposure to a range of operating
currencies versus the US dollar. A substantial portion of the
Group's cash is held in US dollars in order to reduce the impact of
currency movements on financial expenses over time.
As of 31 December 2023, total assets
on the Group's balance sheet were $1,004.7m (FY 2022:
$1,010.0m), with
equity of $699.8m, representing approximately 70% of the balance
sheet.
The Group has remained debt-free
since inception, and had a cash and cash equivalents balance at the
end of FY 2023 of $906.7m (FY 2022: $930.2m). This robust financial position is supported on an on-going
basis by the Group's technology-enabled business model and lean
cost base which allow the Group to invest in its people and its
capabilities with a focus on medium to long-term
returns.
Plus500 continues to generate significant returns for
shareholders
Since the Company's IPO in 2013,
Plus500 has continued to deliver attractive returns of capital to
shareholders of approximately $2.1 billion through dividends and
share buybacks (including returns announced today), having
generated significant levels of cash from operations of
approximately $3.2 billion in that timeframe.
Plus500's shareholder returns policy and the Board's capital
allocation framework
The Company's shareholder returns
policy is to return at least 50% of net profits to shareholders
through share buyback programmes and dividends, on a half yearly
basis, with at least 50% of this distribution being made by way of
share buybacks. The Board will also consider executing special
share buybacks, or other distributions, on a half yearly basis,
dependent on fiscal year results as well as on investment and
growth opportunities. This shareholder returns policy applies to
net profits on a half-yearly basis and is based on a 23% corporate
tax rate, for both interim and final
distributions.
The Board has a clear capital
allocation framework, based on an on-going assessment of the
availability of excess capital going forward, to ensure there
continues to be an optimal balance between shareholder returns,
investments in future growth and in driving business continuity
over the long term. In particular, and aligned to this framework,
the Board will continue to ensure that appropriate levels of
available capital are maintained for required working capital and
other factors to drive future growth.
Shareholder returns announced in FY 2023
The Company returned $365.1m to
shareholders in FY 2023, which included $275.3m of share buybacks and $89.8m in
dividends.
Plus500 is announcing today
additional shareholder returns of $175.0m, comprising of share
buyback programmes of $100.0m and total dividends of $75.0m. The
$100.0m share buyback programme, include a final buyback programme
of $31.0m and a special buyback programme of $69.0m. These
programmes will commence following the completion of the current
share buyback programme of $60.0m, which was announced on 14 August
2023.
The $75.0m of additional dividends
include a final dividend of $31.0m, representing $0.3911 per share,
and a special dividend of $44.0m, representing $0.5551 per share,
equating to a total dividend per share of $0.9462. The final and special dividends
have an ex-dividend date of 29 February 2024, with a record date of
1 March 2024, and a payment date of 11 July 2024. These new
shareholder returns further emphasise the Board's continued
confidence in the prospects for Plus500 and reflect the robust
financial position of the Group. Total dividends paid during 2023
amounted to $89.8m,
representing $1.0578 per share.
At 31 December 2023, the Company
held in treasury a total of 35,170,337 ordinary shares, which were
purchased since the commencement of Plus500's initial share buyback
programmes in 2017, representing approximately 31% of the Company's
issued share capital (the total treasury shares held by the Company
comprise the shares purchased less issued treasury
shares).
Outlook
Based on Plus500's significant
strategic, operational and financial progress over recent years,
and the Group's robust financial position, the Board remains
confident about the Group's future prospects.
Plus500's strategic
roadmap is designed to position the Group for key growth
opportunities, including new products, services and markets, the
expansion of its OTC, futures and share dealing offerings and the
deepening of its customer engagement and retention initiatives.
These growth opportunities will be accessed by the Group's on-going
investment in developing its position as a global multi-asset
fintech group, in particular through further organic investments in
technology, marketing and people, as well as by actively targeting
additional bolt-on acquisitions in selected markets and
geographies.
For FY 2024, the Board expects
Plus500's performance to be in-line with current market
expectations[9] driven by the strength of its
market position, deepening relationship with customers and
successful diversification efforts in the US, Japan and UAE
markets.
Over the medium-term, the Group is
well placed to take advantage of the compelling growth
opportunities in its end markets. Thanks to its proven business
model, strong financial position and disciplined approach to
capital allocation, the Group is focused on driving the
sustainability of its revenues as it develops and invests in its
position as a provider of market-leading B2C (Retail) and B2B
(Institutional) infrastructure services in the US futures
market.
Plus500
LTD.
CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME (UNAUDITED)
|
|
|
|
|
|
|
|
|
|
Trading
income
|
|
674.3
|
832.6
|
Interest
income
|
2c
|
|
|
REVENUE
|
|
726.2
|
832.6
|
Selling and
marketing expenses
|
|
296.9
|
302.1
|
Administrative and general expenses
|
|
|
|
OPERATING
PROFIT
|
|
336.4
|
450.4
|
Financial
income
|
|
6.9
|
41.3
|
Financial
expenses
|
|
|
|
FINANCIAL EXPENSES (INCOME), NET
|
|
|
|
PROFIT BEFORE INCOME TAX
|
|
336.2
|
474.3
|
INCOME TAX EXPENSE
|
|
|
|
PROFIT AND COMPREHENSIVE INCOME FOR THE YEAR
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share (In US
dollars)
|
6
|
|
|
Diluted earnings per share (In
US dollars)
|
6
|
|
|
Plus500
LTD.
CONDENSED CONSOLIDATED STATEMENT OF
FINANCIAL POSITION (UNAUDITED)
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
Non-current assets
|
|
|
|
Property, plant and
equipment
|
|
9.7
|
2.6
|
Goodwill and other intangible
assets, net
|
|
38.3
|
38.7
|
Right of use assets
|
|
17.1
|
5.6
|
Long term other
receivables
|
|
|
|
Total non-current assets
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
Income tax receivable
|
|
1.0
|
0.2
|
Other
receivables and others
|
|
24.4
|
26.9
|
Cash
and cash equivalents
|
|
|
|
Total current assets
|
|
|
|
TOTAL ASSETS
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
Non-current liabilities
|
|
|
|
Lease liabilities (net of current
maturities)
|
|
15.8
|
3.6
|
Deferred tax liability
|
|
|
|
Total non-current liabilities
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
Share based compensation
|
|
3.9
|
6.3
|
Income tax payable
|
|
142.2
|
116.4
|
Other payables
|
|
90.7
|
72.2
|
Service suppliers
|
|
12.6
|
11.7
|
Current maturities of lease
liabilities
|
|
2.6
|
2.0
|
Trade payables - due to
clients
|
7
|
|
|
Total current liabilities
|
|
|
|
TOTAL LIABILITIES
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
Ordinary shares
|
4
|
0.3
|
0.3
|
Share premium
|
|
22.2
|
22.2
|
Cost of Company's shares held by the
Company
|
|
(606.5)
|
(341.1)
|
Retained earnings
|
|
|
|
Total equity
|
|
|
|
TOTAL LIABILITIES AND EQUITY
|
|
|
|
Plus500
LTD.
CONDENSED CONSOLIDATED STATEMENT OF
CASH FLOWS (UNAUDITED)
|
Year ended
|
|
|
|
|
|
|
|
OPERATING ACTIVITIES:
|
|
|
Cash generated from operations (see
Note 8)
|
336.6
|
506.8
|
Income tax paid, net
|
(39.6)
|
(66.2)
|
Interest received
|
|
|
Net cash flows provided by
operating activities
|
|
|
INVESTING ACTIVITIES:
|
|
|
Acquisition of subsidiaries, net of
cash acquired
|
-
|
(4.6)
|
Purchase of property, plant and
equipment
|
|
|
Net cash flows used in investing
activities
|
|
|
FINANCING ACTIVITIES:
|
|
|
Dividend paid to equity holders of
the Company
|
(89.8)
|
(119.9)
|
Payment of principal in respect of
lease liabilities
|
(2.7)
|
(2.3)
|
Acquisition of treasury
shares
|
|
|
Net cash flows used in financing
activities
|
|
|
|
|
|
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS
|
(27.1)
|
187.7
|
|
|
|
BALANCE OF CASH AND CASH EQUIVALENTS AT BEGINNING OF THE
YEAR
|
930.2
|
749.5
|
Gains (Losses) from effects of
exchange rate changes on cash and cash equivalents
|
|
|
BALANCE OF CASH AND CASH EQUIVALENTS AT END OF THE
YEAR
|
|
|
|
|
|
NOTE 1
- GENERAL INFORMATION
Information on activities
Plus500 Ltd. (the "Company" and
together with its subsidiaries, the "Group") 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 Company has developed and operates
online trading platforms, enabling its international customer base
of individual customers to trade OTC products on over 2,500
underlying financial instruments internationally.
The Group's offering is available
internationally with main market presence in the UK, the European
Economic Area ("EEA"), Australia, the US, and the Middle East and
has customers located in more than 60 countries worldwide. The
Group operates through operating subsidiaries regulated by the
Financial Conduct Authority ("FCA") in the UK, the Australian
Securities and Investments Commission ("ASIC") in Australia, the
Cyprus Securities and Exchange Commission ("CySEC") in Cyprus, the
Israel Securities Authority ("ISA") in Israel, the Financial
Markets Authority ("FMA") in New Zealand, the Financial Sector
Conduct Authority ("FSCA") in South Africa, the Monetary Authority
of Singapore ("MAS") in Singapore, the Financial Services Authority
("FSA") in the Seychelles, the Commodities Futures Trading
Commission ("CFTC") in the US, the Estonian Financial Supervision
Authority ("EFSA") in Estonia, the Financial Services Agency
("FSA") in Japan, the Dubai Financial Services Authority ("DFSA")
in the UAE and the Securities Commission of the Bahamas ("SCB") in
the Bahamas.
The Company also has a subsidiary
in Bulgaria which provides operational services to the
Group.
The Company has been listed since
2013 on the London Stock Exchange. Since 2018, Plus500 Ltd. has
been a FTSE 250 listed entity, following the Company's shares being
admitted to the premium listing segment of the Official List and to
trading on the London Stock Exchange Main Market for listed
securities.
The Group offers trading products:
OTC trading; share dealing; and futures and options on futures. The
Group presents its operation as one operating segment.
NOTE
2
- SUMMARY OF MATERIAL ACCOUNTING
POLICIES
a.
Basis of accounting and accounting
policies
The Group's condensed consolidated
financial information as of 31 December 2023 and 2022 and for each
of the two years in the periods ended on 31 December 2023 are
prepared in accordance with International Financial Reporting
Standards ("IFRS").
The material accounting policies in
this financial information have been applied consistently in
relation to all the reporting periods, unless otherwise
stated.
The financial information has been
prepared under the historical cost convention, subject to
adjustments in respect of revaluation of financial assets at fair
value through profit or loss presented at fair value.
b.
Going concern
The Group has considerable
financial resources, a broad range of financial instruments and a
substantial active customer base which is geographically
diversified. As a consequence, the Company's Board of Directors
(the "Board") believes that the Group is well placed to manage its
business risks in the context of the current economic outlook.
Accordingly, the Board has a reasonable expectation that the Group
has adequate resources to continue in operational existence for the
foreseeable future. The Board therefore continues to adopt the
going concern basis in preparing these condensed consolidated
financial statements.
NOTE
2
- SUMMARY OF MATERIAL ACCOUNTING
POLICIES
c.
Interest income
During the year ended 31 December
2023, management has updated the accounting policy regarding the
presentation of interest income. Accordingly, interest income is
accrued based on the effective interest rate method, and is
presented as part of the Group's revenue in the statement of
comprehensive income. Previously, interest income was presented as
part of financial income in the statement of comprehensive income.
The voluntary change in accounting policy is intended to provide
shareholders with better expression of its business activities and
to enhance the comparability of its financial statements to its
peers. The effect of this change on the consolidated financial
statements in previous periods is not material for the consolidated
financial statements as a whole.
NOTE
3
- INCOME TAX
EXPENSES
Law for the Encouragement of Capital Investments,
5719-1959
The Law for the Encouragement of
Capital Investments, 5719-1959, generally referred to as the
"Investment Law", provides certain incentives for capital
investments in production facilities (or other eligible assets) by
"Industrial Enterprises" (as defined under the Investment
Law).
New Tax benefits under the 2017 Amendment that became
effective on 1 January 2017 (the "2017
Amendment")
The 2017 Amendment was enacted as
part of the Economic Efficiency Law that was published on 29
December 2016, and is effective as of 1 January 2017. The 2017
Amendment provides new tax benefits, as described below, and is in
addition to the other existing tax beneficial programmes under the
Investment Law.
The 2017 Amendment provides that a
technology company satisfying certain conditions will qualify as a
Preferred Technological Enterprise ("PTE") and will thereby enjoy a
reduced corporate tax rate of 12% on income that qualifies as
Preferred Technology Income, as defined in the Investment
Law.
Dividends distributed by a PTE,
paid out of Preferred Technology Income, are generally subject to
withholding tax at source at the rate of 20% or such lower rate as
may be provided in an applicable tax treaty.
Company taxation in Israel
The full corporate tax rate in
Israel for the years 2023 and 2022 is 23%.
Under the 2017 Amendment, provided
the conditions stipulated therein are met, technological income
derived by Preferred Companies from "Preferred Technological
Enterprise" (as defined in the 2017 Amendment), would be subject to
reduced corporate tax rates of 12%.
A Preferred Company distributing
dividends from technological income derived from its PTE would
generally subject the recipient to a 20% withholding tax (or lower,
if so provided under an applicable tax treaty).
At the beginning of July 2020, the
Company received an approval from the Israeli Innovation Authority
("IIA") that together with the tax ruling received from the ITA in
May 2019, recognises the Company as a PTE for the years 2017, 2018
and 2019. Accordingly, the applicable tax rate for the preferred
technological income of a PTE for these years was 12%. The Company
was also considered as PTE for the years 2020 and 2021. As a
result, the Company's corporate tax rate for the years 2021 and
2020 was 12%, subject to the Company complying with the conditions
of the Law for the Encouragement of Capital Investments.
In January 2022, the Company's
status as a PTE, as accredited by the ITA under the tax regime in
Israel, has been extended for the years 2022, 2023, 2024, 2025 and
2026, subject to the Company complying with the conditions of the
Law for the Encouragement of Capital Investments. Consequently, the
Company's corporate tax rate for each of these years will be
reduced from 23% to 12% and the withholding tax rate applicable for
dividends will be reduced from 25% to 20%.
NOTE
3
- INCOME TAX
EXPENSES
Tax assessments
The Company is currently subject to
a tax audit in relation to 2020-2022 tax years. The assessments of
amounts of current and deferred taxes require the Group's
management to take into consideration uncertainties that its tax
position will be accepted and of incurring any additional tax
expenses. This assessment is based on estimates and assumptions
based on interpretation of tax laws and regulations, and the
Group's past experience. It is possible that new information will
become known in future periods that will cause the final tax
outcome to be different from the amounts that were initially
recorded, such differences will impact the current and deferred
income tax assets and liabilities in the period in which such
determination is made.
NOTE
4
- SHARE
CAPITAL
Composed of ordinary shares of
NIS 0.01 par value, as follows:
|
Number of ordinary
shares
|
|
|
|
|
|
Authorised
|
|
|
Issued and fully paid
|
|
|
Less treasury shares*
|
|
|
Outstanding shares
|
|
|
*Number of accumulated ordinary
shares that were purchased by the Company as part of the share
buyback programmes, less issue of treasury shares.
NOTE
5
-
DIVIDENDS
The amounts of dividends and the
amounts of dividends per share for the years 2023 and 2022 declared and distributed by the
Company's Board of Directors are as follows:
|
Amount of
dividend
(US $ in
millions)*
|
Amount of
dividend
per share (US
$)
|
Date of payment to
shareholders
|
15 February 2022
|
59.9
|
0.5995
|
11 July 2022
|
17 August 2022
|
60.0
|
0.6238
|
11 November 2022
|
14 February 2023
|
29.9
|
0.3234
|
11 July 2023
|
14 August 2023
|
59.9
|
0.7344
|
9 November 2023
|
*Between the dividend announcement
date and the record date of the dividend, the number of issued and
outstanding ordinary shares of the Company decreased as a result of
the repurchase by the Company of ordinary shares during such period
and the classification of such repurchased ordinary shares as
treasury shares that are not entitled to
dividends. However, this did not affect the dividend per share as
announced on the dividend announcement date.
NOTE
6
- EARNINGS PER
SHARE
Earnings per share is calculated by
dividing the profit attributable to equity holders of the Company
by the weighted average number of ordinary shares in issue during
the year.
|
|
|
|
|
Profit attributable to equity
holders of the
|
|
|
Company (US
dollars in millions)
|
|
|
Weighted average number of ordinary
shares in issue*:
|
|
|
Basic
|
85,744,552
|
97,311,485
|
Dilutive effect of equity share
based compensation
|
|
|
Diluted
|
86,884,126
|
98,254,532
|
Basic earnings per share (In US
dollars)
|
|
|
Diluted earnings per share (In
US dollars)
|
|
|
*After weighting the effect of
Company's share buyback programmes.
NOTE
7
- TRADE PAYABLES
- DUE TO CLIENTS
|
|
|
|
|
|
|
|
|
|
Customers' deposits, net*
|
279.8
|
282.8
|
Segregated client funds
|
|
|
|
30.2
|
10.4
|
|
|
|
*Customers deposits, net, are comprised of the
following:
|
|
|
Customers' deposits
|
409.4
|
411.5
|
Less - financial derivative open
positions:
|
|
|
Gross amount of assets
|
(148.4)
|
(139.0)
|
Gross amount of
liabilities
|
|
|
|
|
|
*The total
amount of 'Trade payables - due to clients' includes bonuses to
clients.
NOTE 8 - CASH GENERATED FROM OPERATIONS
|
|
|
|
|
|
|
Cash generated from operating activities
|
|
|
Net income for the year
|
|
|
Adjustments required to reflect the cash flows
from
|
|
|
operating activities:
|
|
|
Depreciation and
amortisation
|
1.5
|
1.4
|
Amortisation of right of use
assets
|
2.6
|
2.0
|
Liability for share
based compensation
|
2.7
|
11.9
|
Settlement of share
based compensation
|
(10.9)
|
(7.3)
|
Equity share based compensation
|
13.0
|
7.5
|
Taxes on income
|
64.8
|
103.9
|
Interest expenses in respect of
leases
|
0.7
|
0.1
|
Exchange differences in respect of
leases
|
0.7
|
(0.4)
|
Interest income
|
(51.9)
|
(13.5)
|
Foreign exchange losses (gains) on
operating activities
|
|
|
|
|
|
Operating changes in working capital:
|
|
|
Decrease (increase) in other
receivables and others
|
2.4
|
5.2
|
Increase (decrease) in trade
payables due to clients
|
19.8
|
9.8
|
Increase (decrease) in other
payables
|
24.3
|
24.1
|
Increase (decrease) in service
suppliers
|
|
|
|
|
|
Cash generated from
operations
|
|
|
Non-cash
transactions
During the year ended 31 December
2023, $14.1 million in
right of use assets and lease liabilities were
recognised.
NOTE
9
- SUBSEQUENT
EVENTS
In January 2024, the Group
obtained a clearing membership of Eurex
Clearing AG.
On 20 February 2024, the Company
declared a final dividend in an amount of $31.0 million
($0.3911 per share). The dividend record date is 1 March 2024
and it will be paid to the shareholders on 11 July 2024.
On 20 February 2024, the Company
declared a special dividend in an amount of $44.0 million
($0.5551 per share). The dividend
record date is 1 March 2024 and it will be paid to the shareholders
on 11 July 2024.
On 20 February 2024, the Company
declared the adoption of a share buyback programme to buy back up
to $100.0 million of the Company's ordinary shares, comprised of a
final share buyback programme in the amount of $31.0 million and a
special share buyback programme in the amount of $69.0
million.