Plus500 Ltd. · LSE:PLUS
Plus500 — H1 2023 Earnings Presentation
36 slides from Plus500's earnings presentation, Aug 14, 2023
Slide 1: H1 2023 Interim Results
H1 2023 INTERIM RESULTS London Stock Exchange symbol: PLUS Presented by: David Zruia, Chief Executive Officer Elad Even-Chen, Chief Financial Officer 14 August 2023
Slide 2: Agenda
AGENDA OVERVIEW OPERATING TECHNOLOGY FINANCIAL OUTLOOK REVIEW OVERVIEW
Slide 3: Overview
OVERVIEW Plus500 11'S TRADING WITH A PLUS
Slide 4: H1 2023 Key Takeaways
H1 2023 KEY TAKEAWAYS H1 2023 KEY TAKEAWAYS Strong Continued Positive Robust Enhanced performance execution momentum cash position shareholder against strategy with further returns global expansion 4
Slide 5: H1 2023 – Strong Performance
H1 2023 – STRONG PERFORMANCE DRIVING GROWTH AND REINFORCING OUR FINANCIAL POSITION Growth across all key financial metrics in H1 2023 versus H2 2022 $368.5M $174.1M 47% $146.5M Revenue EBITDA1 EBITDA Margin Net profit ▲ 15% (H2 2022: $321.2m) ▲ 17% (H2 2022: $148.5) ▲ 2% (H2 2022: 46%) ▲ 16% (H2 202
Slide 6: From the Plus500 of Yesterday, to the Plus500 of Today
FROM THE PLUS500 OF YESTERDAY, TO THE PLUS500 OF TODAY BEFORE: NOW: A MARKET-LEADING, DIVERSIFIED A STRONG OTC TRADING PLATFORM GLOBAL MULTI-ASSET FINTECH GROUP Multi asset Fintech Group OTC OFFERING FUTURES OFFERING SHARE DEALING OTC OFFERING FUTURES OFFERING SHARE DEALING Existing New Existing New
Slide 7: Benefits of Our Diversification Strategy
BENEFITS OF OUR DIVERSIFICATION STRATEGY HIGHLY DIVERSIFIED REVENUE STREAMS FACILITATE COMPOUNDED RETURNS ENABLING CONTINUED GROWTH AND SCALABILITY WHILST RETURNING VALUE TO SHAREHOLDERS AS A RESULT: Broader range of countries brings more balance to portfolio Expansion in product offering brings Smo
Slide 8: 10th IPO Anniversary
10TH IPO ANNIVERSARY SINCE IPO YEAR IN 2013, PLUS500 HAS GENERATED: $3.0BN $2.4BN $1.9BN Cash from operations Accumulated net profit In shareholder returns 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 8
Slide 9: Sustainability at the Heart of Our Business
SUSTAINABILITY AT THE HEART OF OUR BUSINESS REMAINING FOCUSED ON OUR KEY ESG PRIORITIES Environment Customers Carbon negative target by 2030 Customer care and protection Targeting more efficient data remains a key priority centre and server energy use Increase in educational tools TCFD1 report embed
Slide 10: Operating Review
{ OPERATING REVIEW * Plus50Q0 IT’S TRADING WITH A PLUS
Slide 11: H1 2023 – Another Strong Performance
H1 2023 – ANOTHER STRONG PERFORMANCE DRIVING GROWTH AND REINFORCING OUR FINANCIAL POSITION STRONG BALANCE SHEET + Debt-free since inception + 98% average annual Operating cash conversion1 FY 2013-H1 2023 25M+ 50+ 13 Registered Countries International Customers Operating Licenses PROVEN RECORD OF SHA
Slide 12: H1 2023 - Continued Progress Against Strategic Objectives
H1 2023 - CONTINUED PROGRESS AGAINST STRATEGIC OBJECTIVES UNDERPINNED BY MARKET-LEADING TECHNOLOGY, DIVERSIFIED REVENUE STREAMS AND CONTINUED ABILITY TO ATTRACT AND RETAIN HIGHER VALUE CUSTOMERS Further development Major progress in Supported by continued On-going organic of Plus500’s established op
Slide 13: Portfolio of International Licences Continues to Grow
PLUS500’S PORTFOLIO OF INTERNATIONAL LICENCES CONTINUES TO GROW OTC offering Share dealing Futures and options trading IOSCO United Kingdom Australia South Africa New Zealand USA Jul 2021 Japan Mar 2022 Bahamas Jul 2023 Up to FY 2019 Cyprus Singapore Israel Seychelles Jan 2020 Estonia Feb 2022 UAE F
Slide 14: H1 2023 Operating Overview
H1 2023 OPERATING OVERVIEW CONTINUED ABILITY TO ATTRACT, RETAIN AND DEEPEN RELATIONSHIPS WITH HIGHER VALUE CUSTOMERS, DRIVING HIGHER LIFETIME VALUES KEY OPERATIONAL DRIVERS OPERATIONAL OUTPUTS Our proprietary technology 55% of OTC revenue derived from customers trading with Plus500 for over three ye
Slide 15: The US Growth Opportunity
THE US GROWTH OPPORTUNITY PROMISING RETAIL AND INSTITUTIONAL OPPORTUNITIES IN THE US FUTURES MARKET INSTITUTIONAL RETAIL OPPORTUNITY: OPPORTUNITY: Launched ‘Plus500 Futures‘, intuitive new trading platform, Execution designed for retail traders New B2B line of business as Fully holistic, technology-
Slide 16: H1 2023 KPIs by Region
H1 2023 KPIS BY REGION OUTSTANDING PERFORMANCE ACROSS GEOGRAPHIES 13% 9% 15% $1,360 22% 22% 175,762 50,449 42% $368.5M $2,097 $4,028 Active New Total $1,602 10% 12% ARPU Customers Customers1 Revenue 42% 55% 51% 7% $1,520 UK EEA Australia Rest of world Very strong ARPU performance, Strong level of Ac
Slide 17: Long Term Customer Loyalty and Relationships
PLUS500’S LONG TERM CUSTOMER LOYALTY AND RELATIONSHIPS OTC REVENUE SPLIT BY CUSTOMER TENURE 8% 4% 11% 11% 6% 4% 3% 6% 14% 16% 10% 9% 12% 17% 24% 23% 32% Significant increase in 16% 16% 28% longevity of Plus500’s 24% 19% customer base since 2018: 73% 73% 66% 79% 16% 87% 85% 30% 47% OTC customers trad
Slide 18: Marketing Investment
MARKETING INVESTMENT DRIVES LONG TERM OTC CUSTOMER COHORT VALUE Cumulative Average OTC Revenue per Active Customer over time 2018 2019 2020 2021 2022 2023 $4,000 Targeted, efficient online marketing initiatives $3,000 driven by Plus500's proprietary technology $2,000 $1,000 Time since first deposit
Slide 19: Technology
TECHNOLOGY * Plus50Q0 IT’S TRADING WITH A PLUS
Slide 20: Our Product Offerings
OUR PRODUCT OFFERINGS A FOCUSED TRADING EXPERIENCE FOR CUSTOMERS TRADING PLATFORMS Across operating systems: Webtrader; iOS (Mobile & iPad); Android (Mobile & Tablets) SUPPORTED BY PROPRIETARY TECHNOLOGIES TRADING ACADEMY CRM, Marketing Machine, Retention Machine, Localisation, Education, Risk Manag
Slide 21: Plus500's Proprietary Technology Is Our Key Enabler
PLUS500’S PROPRIETARY TECHNOLOGY IS OUR KEY ENABLER ON-GOING INVESTMENT IN OUR TECHNOLOGY TO HELP DRIVE FUTURE GROWTH Front-End and Back-End Systems Architecture CRM Automated Verification Technologies Cashier Technology Analysis Tools Marketing Technology, AI & Big Data PLUS500 PROPRIETARY Risk Man
Slide 22: Plus500 Proprietary Technology Stack
PLUS500 PROPRIETARY TECHNOLOGY STACK SUPPORTING OUR CUSTOMERS AT EVERY STAGE OF THEIR JOURNEY In-house, tailored technological solutions, equivalent to market-leading SAAS and platform offerings MARKETING OPERATIONS PRODUCT Marketing Customer Payment Trading Risk New product Verification On-boarding
Slide 23: The Benefits of Designing Our Platforms This Way
THE BENEFITS OF DESIGNING OUR PLATFORMS THIS WAY FOR OUR CUSTOMERS FOR OUR GROUP Platform design allows us to adjust Agile and efficient quickly amidst the ever-changing customer journey regulatory landscape Enables stronger retention with Strong system architecture allows 55% of OTC revenue derived
Slide 24: Financial Overview
| FINANCIAL OVERVIEW * Plus50Q0 IT’S TRADING WITH A PLUS
Slide 25: Financial Highlights
FINANCIAL HIGHLIGHTS EXCELLENT PERFORMANCE IN H1 2023 REVENUE ($M) EBITDA ($M) EARNINGS PER SHARE (BASIC) 872.5 $4.71 900 832.6 600 5 515.9 718.7 453.8 $3.81 308.3 4 1.73 321.2 154.1 387.1 $3.06 600 400 148.5 1.35 372.5 3 354.5 368.5 199.5 1.44 192.3 2 $1.61 300 200 174.1 $1.35 564.2 361.8 2.98 206.
Slide 26: Income Statement
INCOME STATEMENT KEY METRICS ($M) H1 2023 H2 2022 % Change H1 2022 % Change H1 23 vs H2 22 H1 23 vs H1 22 Total Revenue 368.5 321.2 15% 511.4 (28%) Strong top line performance supported by consistent Customer Selling and marketing expenses 148.3 132.6 12% 169.5 (13%) Income throughout the period Adm
Slide 27: Cost Profile – Disciplined Approach to Cost Management
COST PROFILE – DISCIPLINED APPROACH TO COST MANAGEMENT KEY ELEMENTS OF OUR COST BASE ($M) CONTROL OVER EXPENSES DUE TO PLUS500’S FLEXIBLE COST STRUCTURE H1 2023 H2 2022 % Change H1 2022 % Change H1 23 vs H2 22 H1 23 vs H1 22 OUR COST BASE Advertising, technology and marketing 75.2 75.3 0% 82.5 (9%)
Slide 28: Balance Sheet
BALANCE SHEET KEY LINE ITEMS ($M) 30/06/2023 31/12/2022 % Change 30/06/2023 31/12/2022 % Change Cash and Cash Equivalents 849.0 930.2 (9%) Current Liabilities 231.2 219.0 6% Other Current Assets 30.5 27.1 13% Non Current Liabilities 18.1 10.5 72% Total Current Assets 879.5 957.3 (8%) Total Liabiliti
Slide 29: Cash Flow
CASH FLOW KEY LINE ITEMS ($M) H1 2023 H2 2022 % Change H1 2022 % Change Operating Activities: H1 23 vs H2 22 H1 23 vs H1 22 Continued strong cash balances Cash generated from operations 130.4 161.9 (19%) 344.9 (62%) of $849.0m at period end Interest received, net 22.3 11.3 97% 2.2 914% Driven by str
Slide 30: Our Approach to Capital Allocation
OUR APPROACH TO CAPITAL ALLOCATION REQUIRED REGULATORY / RISK MANAGEMENT CAPITAL AND SURPLUS CAPITAL REQUIRED REGULATORY CAPITAL CURRENT SURPLUS CAPITAL: AND ADDITIONAL RISK MANAGEMENT CAPITAL: c.$550M* UP TO c.$300M* OF REQUIRED CAPITAL – COVERING: TO BE INVESTED IN: Regulatory Working Risk Clearin
Slide 31: Our Approach to Shareholder Returns
OUR APPROACH TO SHAREHOLDER RETURNS TRACK RECORD OF SIGNIFICANT SHAREHOLDER RETURNS Total of $347.4m shareholder returns announced so far in FY 2023 Shareholder returns policy: At least 50% of net profits to be returned to shareholders through SINCE FY 2013 In respect of H1 2023 share buybacks and d
Slide 32: Outlook
» OUTLOOK * Plus50Q0 IT’S TRADING WITH A PLUS
Slide 33: Outlook – Seizing the Growth Opportunities Ahead
OUTLOOK – SEIZING THE GROWTH OPPORTUNITIES AHEAD THE BOARD REMAINS CONFIDENT ABOUT PLUS500’S FUTURE PROSPECTS OUTLOOK MEDIUM TO LONG TERM VIEW Based on Plus500’s significant progress over Plus500 will continue to pursue major growth recent years, the Board remains confident opportunities, through or
Slide 34: Delivering on Longer Term Business Plan
DELIVERING ON LONGER TERM BUSINESS PLAN EXECUTING ON OUR STRENGTHS TO GENERATE SUSTAINED VALUE CREATION US Futures - Monetisation, New geographic Harnessing Expanding increasing retention and expansion best in class product offering market share activation of opportunities proprietary to deliver in
Slide 35: Thank You Q&A
THANK YOU Q&A Investor Relations Contact: Owen Jones Head of Investor Relations owen.jones@plus500.com ir@plus500.com
Slide 36: Disclaimer
DISCLAIMER The Presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any The Company does not accept any responsibility for the accuracy or completeness of any information reported by offer to purchase or subscribe for, any shares or other