Plus500 Ltd. · LSE:PLUS
Plus500 — FY2021 Earnings Presentation
43 slides from Plus500's earnings presentation, Feb 15, 2022
Slide 1: FY 2021 Preliminary Results
FY 2021 Preliminary Results London Stock Exchange symbol: PLUS Presented by: David Zruia, Chief Executive Officer Elad Even-Chen, Chief Financial Officer 15 February 2022
Slide 2: Agenda
FY 2021 Preliminary Results 2 Agenda Strategic Operating Risk management, Financial Outlook overview review regulation overview & governance
Slide 3: Strategic overview
Plué¢s500 Strategic overview oe
Slide 4: Plus500 Vision: Enabling trusted and intuitive access to financial opportunities
Strategic overview 4 Plus500 Vision: Enabling trusted and intuitive access to financial opportunities Evolving into a global multi-asset fintech group Driven by continued investment to scale our technology Across financial instruments Across countries Across devices through broad product range throu
Slide 5: Our vision is supported by a robust investment case
Strategic overview 5 Our vision is supported by a robust investment case Supportive market State-of-the-art Market-leading core environment with technological product offering with long term structural platforms expansion potential growth drivers into new segments Strong global Long-standing, high Ro
Slide 6: Substantial base of registered customers
Strategic overview 6 Substantial base of registered customers Major milestone achieved in FY 2021 An outstanding achievement, reflecting Plus500’s market-leading offering 22m+ On-going activities to drive Continued investment in customer retention, activation and marketing technologies and monetisat
Slide 7: Plus500 business model
Strategic overview 7 Plus500 business model Our competitive advantages and differentiators Our leadership, Our technology Our track record Our agile business model people and culture Powers our products, Strong financial performance Technological expertise Ensuring a customer-centric operations and
Slide 8: Plus500's proprietary technology is our key enabler
Strategic overview 8 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 Plus500 proprietary technology Analysis tools Marketing te
Slide 9: Plus500 proprietary technology stack
Strategic overview 9 Plus500 proprietary technology stack Supporting our customers at every stage of their journey Marketing Operations Product On-going Product Further Marketing Customer Payment Verification On-boarding product upgrades and products technology service processing usage improvements
Slide 10: Our track record of profitable growth
Strategic overview 10 Our track record of EBITDA ($m) profitable growth 34% 47% 41% 58% 64% 48% 46% 59% 70% 54% 59% 54% % margin 506 516 387 259 192 Number of Active Customers 434 67 145 133 151 (‘000) 407 8 24 23 317 305 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 200 156 Headcount
Slide 11: Excellent progress on strategic roadmap in FY 2021
Strategic overview 11 Excellent progress on strategic roadmap in FY 2021 Continued development of Plus500’s position as a global multi-asset fintech group Strategic priorities achieved in FY 2021: Future strategic priorities: Continued investment in Roll-out of ‘Plus500 Invest’ - Entered US Futures
Slide 12: Operating review
Pluss500 Pan Operating review ®
Slide 13: Operating Overview
Operating review 13 Operating Overview Executing against our strategic priorities - FY 2021 performance Validates continued investment in Continued high customer Another strong performance in our technology platforms engagement attracting and retaining customers Consistently strong levels of 407,374
Slide 14: FY 2021 Financial Highlights
Operating review 14 FY 2021 Financial Highlights 900 Revenue ($m) Financial Performance 308.3 600 254.9 372.5 Financial Summary 300 248.8 564.2 169.1 465.5 206.5 346.2 158.8 188.4 148.0 0 Another outstanding financial performance: 2016 2017 2018 2019 2020 2021 Revenue of $718.7m, supported by consis
Slide 15: Our core product offering – a diverse proposition for customers
CFD Futures and options on futures Share dealing Operating review 15 Our core product offering – a diverse proposition for customers Our range of asset classes Our product proposition Why customers trade CFDs Long term track record as CFD Access to market liquidity platform provider Stocks Highly re
Slide 16: Leading market positions
CFD Futures and options on futures Share dealing Operating review 16 Leading market positions Market Share (%) 19% Leading provider 17% Plus500 Next largest provider Leading industry positions in core markets: Fastest-growing trading platform in UK1 Germany 2 No.1 CFD provider in Germany2 20% 19% No
Slide 17: Core product - market opportunity
CFD Futures and options on futures Share dealing Operating review 17 Core product - market FY 2021 opportunity 12% 17% Substantial untapped 1% customer base outside current key regions Active 13% Population customers by region by region 57% EEA 13% UK 87% Australia RoW1 RoW2 1. RoW – Rest of World 2
Slide 18: Futures and options on futures – market opportunity
CFD Futures and options on futures Share dealing Operating review 18 Futures and options on futures – market opportunity Significant expansion potential in the US and beyond Regulatory framework Fragmented and diverse A very favourable creates high barriers to entry competitive environment – trading
Slide 19: Best-in-class technology applicable to futures and options on futures
CFD Futures and options on futures Share dealing Operating review 19 Plus500’s best-in-class technology is highly applicable to the futures and options on futures market Technology leverage is the key value driver Market-leading technological expertise Robust system architecture Plus500 will be able
Slide 20: Share dealing – Plus500 Invest
CFD Futures and options on futures Share dealing Operating review 20 Share dealing – Plus500 Invest Rationale for market entry: Current offering Future plans: Revenue and product diversification c.1,500 different equities Continued organic investments Customer retention Available in +15 countries ac
Slide 21: Technology developments - operations & systems
Operating review 21 Technology developments - operations & systems Progress made in further strengthening our technology backbone Continued investment in technology Plus500 continues to lead the way in drives its agility and adaptability mobile and tablet interface accessibility Operations Systems R
Slide 22: FY 2021 KPIs by region
Operating review 22 FY 2021 KPIs by region Excellent performance Active % New % Revenue % ARPU Customers proportion Customers proportion ($m) proportion ($) UK 55,329 13% 26,451 13% 88.9 12% 1,606 EEA 232,654 57% 110,193 56% 329.0 46% 1,414 Australia 51,365 13% 28,891 15% 61.6 9% 1,199 RoW1 68,026 1
Slide 23: Our approach to marketing
Operating review 23 Our approach to marketing Multi-layered and multi-channel marketing approach, driven by Plus500 technologies Paid search Media Partners Organic search Content marketing PR and sponsorship Performance marketing, Partnerships with Alongside paid search Technology-driven Brand recog
Slide 24: Marketing Investment
Operating review 24 Marketing Investment Cumulative average revenue per Active Customer over time Drives long term customer cohort value $5,000 Targeted, efficient online marketing initiatives driven by Plus500 proprietary technology $4,000 Sustained levels of investment in marketing technology capa
Slide 25: High return on marketing investment…
Operating review 25 High return on marketing investment… Long term revenue return consistently exceeds initial marketing investment Cumulative cohort revenue Cumulative Return ($m) Marketing investment 2016 2016 registrations registrations 2017 2017 registrations registrations 2018 2018 registration
Slide 26: Monetisation and retention initiatives
Operating review 26 Monetisation and retention initiatives Current programmes Premium Service – “Making Our Customers Feel Special” A dedicated Customer Manager Premium Service customer support Conversion Professional trading webinars Drive customer Weekly analysis emails retention Trust Market Even
Slide 27: Evidence of impact of customer retention initiatives
Operating review 27 Evidence of impact of New Open Positions (millions) customer retention initiatives 4,000 90 Average Position Duration (minutes) Average position duration 82.7 and new open positions 3,228 3,000 60 2,240 57.3 Average position duration increased with reduced leverage limits 2,000 1
Slide 28: Long term customer relationships
Operating review 28 Long term customer FY2021: 16% 4% FY2020: 14% 6% relationships 17% 28% 19% 24% CFD revenue split by customer tenure 79% 66% 44% 28% 0-6 months Long term, sustainable 7-12 months FY2019: 11% 11% FY2018: 8% 4% customer relationships 1-3 years 12% 23% 16% 16% 3-5 years 5+ years >1 y
Slide 29: Risk management, regulation & governance
Risk management, regulation & governance
Slide 30: Plus500 approach to risk management
Risk management 30 Plus500 approach to risk management Market risk managed Three lines of defence through internalisation: Ensures Plus500 interests are aligned with its customers – with Risk policy Risk strategy and a focus on customer protection Risk approach Risk controls approach and customer ex
Slide 31: An established worldwide regulatory framework
Regulation 31 An established worldwide regulatory framework Plus500 operates in a highly regulated, compliance-driven environment Global regulatory framework to enable stability CFD offering Share dealing Futures and options trading IOSCO ESMA ASIC MAS FCA FSA CFTC
Slide 32: Plus500 Group's regulated operations
Regulation 32 Plus500 Group’s regulated operations All customer operations Robust global regulatory framework conducted through licensed and regulated entities Strong background and expertise in successfully navigating regulatory frameworks and adding new regulatory licenses Tallinn Monetary Authori
Slide 33: Further progress in areas of Governance and Sustainability
Governance and sustainability 33 Further progress in areas of Governance and Sustainability Governance: Sustainability: Continued broadening of Further focus on Continued focus on Employee welfare expertise and increasing ESG approach: customer care and and support: diversity of the Board: protectio
Slide 34: Financial overview
Plué¢s500 Financial overview ©
Slide 35: A significant track record of cash generation
Financial overview 35 A significant track record of cash generation Has enabled substantial shareholder returns since IPO Supports our balanced approach to capital allocation: $2.4 billion Shareholder returns Investment in growth: General business Cash generated from of approximately continuity and
Slide 36: Income Statement
Financial overview 36 Income Statement Key Metrics ($m) Another strong revenue performance FY FY % FY % 2021 2020 Change 2019 Change Driven by Customer Income of $702.8m (FY 2020: $997.5m, FY 2019: $382.4m) Revenue 718.7 872.5 (18%) 354.5 103% Selling and Marketing Expenses 279.8 315.4 (11%) 138.9 1
Slide 37: Cost profile
Financial overview 37 Cost profile 28% 72% 20% 80% Key Elements ($m) FY 2021 FY 2020 FY FY % FY % 2021 2020 Change 2019 Change Variable* Fixed Advertising technology 172.1 221.1 (22%) 95.6 80% and marketing investment Processing costs 40.8 53.0 (23%) 15.8 158% Payroll and related expenses 33.0 26.0
Slide 38: Balance Sheet
Financial overview 38 Balance Sheet Key Metrics ($m) FY FY % FY % Plus500 remains debt-free 2021 2020 Change 2019 Change Cash and Cash Equivalents No debt on balance sheet since being established in 2008 749.5 593.9 26% 292.9 156% Other Current Assets 32.7 16.1 103% 14.7 122% Total Current Assets 78
Slide 39: Cash Flow
Financial overview 39 Cash Flow Continued strong cash generation - operating cash conversion of 99% Key Metrics ($m) (FY 2020: 106%) FY FY % FY % Driven by EBITDA performance Operating Activities: 2021 2020 Change 2019 Change and low capital intensive nature of Plus500 Cash generated from operations
Slide 40: Outlook
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Slide 41: Outlook & guidance
Outlook 41 Outlook & Our vision: guidance “Enabling trusted and intuitive access to financial opportunities” Developing our position as a global multi-asset fintech group The Board remains confident about the Medium to long term outlook for Plus500 Our strategic enablers: FY 2022 outlook: outlook: M
Slide 42: Q&A
Plu¢so00 Q&A
Slide 43: Disclaimer
Appendices 43 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 The Company does not accept any responsibility for the accuracy or completeness of any information reported by the press purchase or subscribe f