Plus500 Ltd. · LSE:PLUS
Plus500 — FY2013 Earnings Presentation
29 slides from Plus500's earnings presentation, February 2014
Slide 1: London Stock Exchange Symbol: PLUS
London Stock Exchange Symbol: PLUS 1
Slide 2: Disclaimer
Disclaimer The Presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares or other securities of the Company, nor shall it (or any part of it), or the fact of its distribution, form the basis of
Slide 3: Business Overview
Business Overview Plus500 in numbers: Plus500 has developed and operates an online trading platform for retail customers to trade Contracts For Difference (CFDs) in more than 50 countries #1 >50 31 Rated on mobile Languages app stores Countries Proprietary technology platform is user friendly, robus
Slide 4: Results Summary
Results Summary Record year for revenue and profit - significantly ahead of expectations at the time of the IPO Successful listing on AIM in July 2013 Active customers increased 47% to 85,795 (FY 2012: 58,343) New customers increased 53% to 56,819 (FY 2012: 37,050) Ongoing strengthening in Plus500’s
Slide 5: Business Overview, Financial Overview, Outlook
Business Overview Financial Overview Outlook 5
Slide 6: Products
Products CFD products Platform and Devices Trading Platform Supporting 31 languages in 1,900 CFD products Retail customers only more than 50 countries 6
Slide 7: Business model
Business model Revenues International Revenue Split FY 2013 Footprint Plus500 UK FCA UK-regulated subsidiary Dealing Spreads Plus500 Ltd. Market Israel Headquarters Difference between the buy price Premium 3% 23% and the sell price of a CFD Overnight Premiums Charges on open customer Spreads 74% pos
Slide 8: Plus500 technology, our key asset
Plus500 technology, our key asset Proprietary technology, developed in-house: key differentiator and flexible advantage System Architecture “Marketing User Interface Machine” Back Affiliate Office Program Hedging and Risk Fraud Payment Management Interface 8
Slide 9: Marketing infrastructure: online is key
Marketing infrastructure: online is key Total marketing investment in $m Online advertising 40 Using our proprietary automated marketing platform 35.9 30 ensures that spending is efficient with a demonstrable return on investment 20 23.0 19.8 10 11.9 The “Marketing Machine” 0 Focus is online 2010 20
Slide 10: Marketing infrastructure: affiliates and offline
Marketing infrastructure: affiliates and offline .com A large international affiliates program Over 5,000 active affiliates who advertise Plus500 Paid on success only Easy-to-access and use affiliates’ portal of marketing collateral Fully automated online analysis and reward platform Localized marke
Slide 11: The Plus500 Brand
The Plus500 Brand United Kingdom Italy Netherlands * Data from Google Trends web searches, Jan 2011 – Jan 2014 11
Slide 12: Mobile as a key growth driver
Mobile as a key growth driver Number of Signups by Device Revenues by Device 100% 100% 90% 90% 80% 80% 70% 70% 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% Windows Web IPhone IPad Android AndroidTablet Windows Web IPhone IPad Android AndroidTablet 12
Slide 13: Risk management
Risk management Financial risk management is key to the business Risk Management Advisory Market Risk Spread of customers acts as a natural risk-mitigation: No dominant customers Real-time monitoring of exposure limits by: Regulators Individual clients Individual instruments Total Group exposure Whe
Slide 14: Regulation and Compliance
Regulation and Compliance Client Take-On Ltd Israel Headquarters FCA / ASIC rules set out client take-on requirements Customers must self-certify their understanding of the risks UK Ltd AU Pty Ltd FCA Registered Australian (ASIC) Regulated All marketing carries appropriate risk warnings All EEA cust
Slide 15: Minimising downside risk: daily income statement
Minimising downside risk: daily income statement $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 Mar 10 Jun 10 Sep 10 Dec 10 Mar 11 Jun 11 Sep 11 Dec 11 Mar 12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13 Sep 13 Dec 13 -$500,000 15
Slide 16: 2013 – Key Management Initiatives
2013 – Key Management Initiatives Launching Plus500AU – Our Australian subsidiary which holds an ASIC license Successful IPO (Q3 2013) Over 600 new CFD products New features in mobile to bring on par with PC version Improving marketing ROI Improved retention initiatives 16
Slide 17: Business Overview, Financial Overview, Outlook
Business Overview Financial Overview Outlook 17
Slide 18: FY 2013 - Best Performances Yet
FY 2013 - Best Performances Yet Key Financial Indicators – Income Statement ($ ,000): Twelve months ended December 31 2013 2012 FY13/FY12 growth Trading income (net) 115,088 56,127 105% Selling and marketing expenses 44,322 28,930 53% Administrative and general expenses 3,563 4,124 -14% EBITDA 67,28
Slide 19: Our Client Base Continues to Grow Fast
Our Client Base Continues to Grow Fast Number of Active Accounts Number of New Accounts 100,000 100,000 90,000 90,000 80,000 85,795 80,000 +47% 70,000 70,000 60,000 60,000 50,000 58,343 50,000 +53% 56,819 40,000 40,000 30,000 30,000 37,050 20,000 20,000 10,000 10,000 FY 12 FY 13 FY 12 FY 13 Ratings
Slide 20: ARPU Vs. AUAC
ARPU Vs. AUAC ARPU ($) AUAC ($) 2,000 2,000 1,800 1,800 1,600 1,600 1,400 1,400 1,200 1,325 1,200 1,000 +38% 1,000 800 962 800 600 600 +1% 400 628 632 400 200 200 0 0 FY 12 FY 13 FY 12 FY 13 Further significant growth expected in ARPU in 2014 due to improved branding and retention initiatives Expect
Slide 21: Spreads and Premium - Key Revenues Sources
Spreads and Premium - Key Revenues Sources Revenue by Source ($, Qs): 60,000,000 50,000,000 40,000,000 30,000,000 20,000,000 10,000,000 0 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 Spreads Premium P&L 21
Slide 22: Lean Operational Infrastructure
Lean Operational Infrastructure Operational Expenses: 50,000 44,322 45,000 Fully automated operations 40,000 35,000 30,000 28,930 Aggressive cost structure 25,000 FY 12 20,000 FY 13 Talented HR generates higher 15,000 10,000 revenues per employee 4,124 3,563 5,000 - Total Sales & Marketing Total G&A
Slide 23: Balance Sheet Strengthened
Balance Sheet Strengthened Key Financial Indicators – Balance Sheet: Twelve months ended December 31 FY 13/FY 12 2013 2012 Growth Current Assets 88,739 24,709 259% Non Current Assets 1,354 546 148% Total Assets 90,093 25,255 257% Liabilities 22,079 13,308 66% Equity 68,014 11,947 469% 23
Slide 24: Cash Grew
Cash Grew Key Financial Indicators – Cash Flow: FY 13/ Twelve months ended December 31 FY 12 2013 2012 Growth Operating activities: Cash generated from operations 66,991 23,216 189% Income tax paid - net (9,894) (3,355) 195% Net cash provided by operating activities 57,097 19,861 187% Net cash used
Slide 25: Dividends Remain High
Dividends Remain High Dividend Paid to Shareholders ($ ,000): 35,000 30,000 33,000 25,000 20,000 15,000 16,810 14,575 10,000 8,795 9,642 5,000 0 2010 2011 2012 2013 Q1 2014 Dividend payout of $0.2873 per share (Ex-Date 12 March 2014) – Final dividend of $0.1506 per share and special dividend of $0.1
Slide 26: Business Overview, Financial Overview, Outlook
Business Overview Financial Overview Outlook 26
Slide 27: 2014 – Key Management Initiatives
2014 – Key Management Initiatives Key focus to continue to invest in current markets Continued optimisation of marketing ROI Establishment of cost effective call centre Launch windows phone app and strengthen web app Exploring opportunities for expansion into new geographies 27
Slide 28: Outlook
Outlook We ended 2013 with record customer and deposit levels Strong start to 2014 Further considerable growth in 2014 The Board remain committed to a 50% payout dividend policy Additional special dividends where capital needs allow 28
Slide 29: Contact Details
Contact Details Elad Even-Chen, Ltd. Head of Investor Relations MATAM, Building 22 Tel: +972-4-8189503 Haifa, 31905 Israel Email: ir@Plus500.com UK Ltd. AU Pty Ltd. 359 Goswell Road 19-21 Hunter St London, EC1V 7JL Sydney, 2000 UK Australia 29