Plus500 Ltd. · LSE:PLUS
Plus500 — FY2023 Earnings Presentation
40 slides from Plus500's earnings presentation, Feb 20, 2024
Slide 1: Preliminary Results FY 2023
PRELIMINARY RESULTS FY 2023 London Stock Exchange symbol: PLUS Presented by: David Zruia, Chief Executive Officer Elad Even-Chen, Chief Financial Officer 20 February 2024
Slide 2: Agenda
AGENDA OVERVIEW OPERATING TECHNOLOGY FINANCIAL SUMMARY REVIEW OVERVIEW & OUTLOOK
Slide 3: Overview
OVERVIEW Plus500 11'S TRADING WITH A PLUS
Slide 4: The Plus500 of Today
THE PLUS500 OF TODAY A MARKET-LEADING, DIVERSIFIED GLOBAL MULTI-ASSET FINTECH GROUP Global Multi-Asset Fintech Group OTC1 Futures Share Dealing Existing New B2C B2B Existing New markets markets (Retail) (Institutional) markets markets Clearing ’Plus500 Futures’ Execution SaaS | T4 - Trading Platform
Slide 5: Plus500 Business Model
PLUS500 BUSINESS MODEL OUR ENDURING SUCCESS IS BUILT ON STRONG FOUNDATIONS Our customer-centric Our leadership, Our technology Our economic model approach people and culture Powers our products, Our agile business model Technological expertise Financial drivers operations and marketing embedded acro
Slide 6: Plus500's Competitive Advantages and Differentiators
PLUS500’S COMPETITIVE ADVANTAGES AND DIFFERENTIATORS KEY DRIVERS SUPERIOR OFFERINGS >26M 60+ Registered Customers Countries Proprietary Regulatory Balance sheet 13 >2,500 technology licences portfolio strength Regulatory licences globally Financial instruments C.550 >$900M Employees worldwide Cash b
Slide 7: FY 2023 – Strong Performance
FY 2023 – STRONG PERFORMANCE DRIVING GROWTH AND REINFORCING OUR FINANCIAL POSITION STRONG FINANCIAL FOCUS ON HIGHER PERFORMANCE VALUE CUSTOMERS $726.2M $340.5M c.$10,300 $3,116 Revenue EBITDA1 Average deposit per ARPU2 Active Customer 47% $271.4M $1,489 233,037 EBITDA Margin Net Profit AUAC3 Active
Slide 8: Enhanced Customer-Centric Approach
ENHANCED CUSTOMER-CENTRIC APPROACH MONETISATION, ACTIVATION AND RETENTION INITIATIVES Dedicated Account Manager Drive customer retention Best-in-class service Awareness campaign Conversion and tailored solutions 24/7 instant support (Native in 16 languages) Trust Additional trading opportunities Mon
Slide 9: ESG at the Heart of Our Business
ESG AT THE HEART OF OUR BUSINESS REMAINING FOCUSED ON OUR KEY ESG PRIORITIES SOC IA Environment People T L ONMEN TCFD1 report embedded as Training, learning and career part of the Annual Report development opportunities Adoption of Environmental Policy Continued commitment to equal VIR Carbon negati
Slide 10: Operating Review
{ OPERATING REVIEW * Plus50Q0 IT’S TRADING WITH A PLUS
Slide 11: Delivering on Longer Term Business Plan
DELIVERING ON LONGER TERM BUSINESS PLAN STRENGTHS TO GENERATE SUSTAINED VALUE CREATION LICENCES MEMBERSHIPS CAPITAL STRATEGIC PLATFORMS Highly Regulated Scarce assets Strong balance sheet STAKEHOLDERS Technology and to cater significant Business alliances & automation oriented volumes partnerships >
Slide 12: Plus500 - Futures Business
PLUS500 - FUTURES BUSINESS PLUS500’S TECHNOLOGY AND FINANCIAL STRENGTH ENABLE A SUPERIOR FUTURES OFFERING Advanced Dedicated Competitive trading platforms backend solutions fee structures International agile Comprehensive support service clearing capabilities
Slide 13: Understanding the Futures Market
UNDERSTANDING THE FUTURES MARKET A VIEW OF HOW THE FUTURES MARKET LOOKS Introducing Broker A Client A A A Client B B Plus500 has developed ‘Plus500 Futures’ a new US futures trading platform for retail customers Client C B The platform provides access to execute and C Plus500 as a Exchange / Clearin
Slide 14: FY 2023 Operating Overview
FY 2023 OPERATING OVERVIEW PROVEN ABILITY TO ATTRACT, RETAIN AND DEEPEN RELATIONSHIPS WITH HIGHER VALUE CUSTOMERS TO FOSTER INCREASED VALUE CREATION KEY OPERATIONAL DRIVERS OPERATIONAL OUTPUTS 59% of OTC revenue derived from Our proprietary technology customers trading with Plus500 for over three ye
Slide 15: Plus500's 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% 3% 14% 16% 10% 9% 17% 24% 12% 23% 29% 16% 16% 28% 24% 19% 29% 73% 73% 66% 79% 16% 87% 88% 47% 53% 44% 30% 46% 28% FY-2018 FY-2019 FY-2020 FY-2021 FY-2022 FY-2023 0-6 months 7-12 months
Slide 16: Diversified Core Product Offering
DIVERSIFIED CORE PRODUCT OFFERING PLUS500’S HIGHLY ESTABLISHED PROPOSITION Wide range of asset classes enabling Evidence of impact of OTC customers to adapt their strategy OTC customer engagement initiatives % of OTC customers trading 6 classes 7 classes Average position duration and new open positi
Slide 17: FY 2023 KPIs by Region
FY 2023 KPIS BY REGION OUTSTANDING PERFORMANCE ACROSS GEOGRAPHIES 13% 15% 9% $2,137 22% 21% 39% 233,037 90,944 $726.2M $5,638 $3,116 10% Active 11% New $2,519 Revenue ARPU Customers Customers1 45% 55% 53% 7% $2,271 UK EEA Australia Rest of World Record ARPU performance, Active Customer base Strong l
Slide 18: Technology
a a" TECHNOLOGY * Plus50Q0 IT’S TRADING WITH A PLUS
Slide 19: The Benefits of Designing Our Platforms
THE BENEFITS OF DESIGNING OUR PLATFORMS FOR OUR CUSTOMERS: FOR OUR GROUP: Platform design allows us to Agile and efficient adjust quickly to regulatory customer journey changes Enables stronger retention with Strong system architecture allows 59% of OTC revenue derived by 3+ greater scalability, whi
Slide 20: Our Product Offerings
OUR PRODUCT OFFERINGS A FOCUSED TRADING EXPERIENCE FOR CUSTOMERS TRADING ACADEMY SUPPORTED BY PROPRIETARY TECHNOLOGIES TRADING PLATFORMS ACROSS OPERATING SYSTEMS CRM, Marketing Machine, Retention Machine, Webtrader; iOS (Mobile & iPad); Android (Mobile & Tablets) Localisation, Education, Risk Manage
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 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 Manageme
Slide 22: Agile and Efficient Customer Journey
AGILE AND EFFICIENT CUSTOMER JOURNEY SUPPORTING OUR CUSTOMERS AT EVERY STAGE OF THEIR JOURNEY Marketing technology On-boarding Payment processing Risk management MARKETING OPERATIONS PRODUCT Verification Customer service Trading solutions New product offerings In-house, tailored technological soluti
Slide 23: Leading Mobile Offering Across Devices
LEADING MOBILE OFFERING ACROSS DEVICES INNOVATIVE AND INTUITIVE PRODUCT OFFERING ACROSS MOBILE DEVICES PLUS500 CONTINUES TO LEAD THE WAY IN MOBILE AND TABLET INTERFACE ACCESSIBILITY +87% of OTC revenue generated through mobile and tablet offerings +82% of all customer OTC trades took place on mobile
Slide 24: Financial Overview
| FINANCIAL OVERVIEW * Plus50Q0 IT’S TRADING WITH A PLUS
Slide 25: FY 2023 – Another Strong Financial Performance
FY 2023 – ANOTHER STRONG FINANCIAL PERFORMANCE DRIVING GROWTH AND REINFORCING OUR FINANCIAL POSITION STRONG BALANCE SHEET Debt-free since inception 100% average annual Operating Cash Conversion2 FY 2013 - FY 2023 $726.2m $340.5m $3.17 Revenue EBITDA Basic EPS PROVEN RECORD OF SHAREHOLDER RETURNS $2.
Slide 26: Income Statement
INCOME STATEMENT KEY METRICS ($M) FY 2023 FY 2022 % Change H2 2023 H2 2022 % Change Revenue 726.2 832.6 (13%) 357.7 321.2 11% Selling and marketing expenses 296.9 302.1 (2%) 148.6 132.6 12% Administrative and general expenses 92.9 80.1 16% 45.0 41.8 8% EBITDA 340.5 453.8 (25%) 166.4 148.5 12% EBITDA
Slide 27: Cost Profile – Disciplined Approach to Cost Management
COST PROFILE – DISCIPLINED APPROACH TO COST MANAGEMENT CONTROL OVER EXPENSES DUE TO PLUS500’S FLEXIBLE COST STRUCTURE Key Elements of cost base ($m) FY 2023 FY 2022 % change OUR COST BASE Advertising, technology and marketing investment 135.4 157.8 (14%) Payment processing costs 40.0 44.9 (11%) Payr
Slide 28: Balance Sheet
BALANCE SHEET KEY LINE ITEMS ($M) 31/12/2023 31/12/2022 % Change 31/12/2023 31/12/2022 % Change Cash and Cash Equivalents 906.7 930.2 (3%) Current Liabilities 282.2 219.0 29% Other Current Assets 25.4 27.1 (6%) Non Current Liabilities 22.7 10.5 116% Total Current Assets 932.1 957.3 (3%) Total Liabil
Slide 29: Cash Flow
CASH FLOW KEY LINE ITEMS ($M) OPERATING ACTIVITIES: FY 2023 FY 2022 % Change Cash generated from operations 336.6 506.8 (34%) Highly cash generative – average Interest received 51.9 13.5 284% Operating cash conversion for FY 2013 to FY 2023 of 100% Income tax paid, net (39.6) (66.2) (40%) Driven by
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.$350M* of required capital – covering: to be invested in: Regulatory Working Risk Clearin
Slide 31: Our Approach to Shareholder Returns
OUR APPROACH TO SHAREHOLDER RETURNS ESTABLISHED TRACK RECORD OF SIGNIFICANT SHAREHOLDER RETURNS Total of c.$350m shareholder returns announced during FY 2023 Shareholder returns policy: $2.1BN c.$350M $175.0M At least 50% of net profits to Shareholder returns since Shareholder returns Shareholder re
Slide 32: Summary & Outlook
» SUMMARY & OUTLOOK * Plus50Q0 IT’S TRADING WITH A PLUS
Slide 33: A Long Track Record of Profitable Growth & Cash Generation
A LONG TRACK RECORD OF PROFITABLE GROWTH & CASH GENERATION STRONG OPERATIONAL AND FINANCIAL PERFORMANCE SINCE IPO IN 2013 Since IPO year in 2013, STRONG BALANCE SHEET Plus500 has generated: GROWING TOPLINE Debt-free since inception 20% CAGR revenue growth $3.2bn 100% average annual operating between
Slide 34: Diversification Strategy
DIVERSIFICATION STRATEGY HIGHLY DIVERSIFIED REVENUE STREAMS ENABLE CONTINUED GROWTH AND SCALABILITY WHILST RETURNING VALUE TO SHAREHOLDERS DIVERSIFICATION STRATEGY OUTCOMES: A well-balanced portfolio with diverse global regulatory licences Expansion in product offering brings enhanced choice for cus
Slide 35: Our Strategic Roadmap
OUR STRATEGIC ROADMAP KEY GROWTH OPPORTUNITIES OVER THE MEDIUM TERM New Products New Markets Expanding Offering Deepening Customer in Existing Markets Engagement 35
Slide 36: Plus500 Investment Case
PLUS500 INVESTMENT CASE 1 2 3 Established track record Focus on higher-value, long-term Diversification of products, of innovation and growth customers building inherent value markets and revenues 4 5 6 Extremely robust Attractive shareholder returns Long-term planning underpins financial position i
Slide 37: 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 38: Appendix
Plussoo APPENDIX
Slide 39: Plus500's Portfolio of International Licences Continues to Grow
PLUS500’S PORTFOLIO OF INTERNATIONAL LICENCES CONTINUES TO GROW AN INCREASINGLY VALUABLE ASSET United Kingdom Australia South Africa New Zealand USA Jul 2021 Japan Mar 2022 Bahamas Jul 2023 Up to FY 2019 Cyprus Singapore Israel Seychelles Estonia UAE Jan 2020 Feb 2022 Feb 2023 39
Slide 40: 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