Plus500 Ltd. · LSE:PLUS
Plus500 — FY2020 Earnings Presentation
37 slides from Plus500's earnings presentation, Feb 17, 2021
Slide 1: FY 2020 Preliminary Results
FY 2020 Preliminary Results London Stock Exchange symbol: PLUS Presented by: David Zruia, Chief Executive Officer Elad Even-Chen, Chief Financial Officer 17 February 2021 * Illustrative figures
Slide 2: Agenda
Results for the twelve months ended 31 December 2020 2 Agenda Strategic Results Operating Financial Outlook overview highlights review overview
Slide 3: Strategic overview
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Slide 4: Plus500’s Technology Edge
Strategic overview 4 Plus500’s Technology User Interface Online technology 500Affiliates Edge capabilities Programme Our Key Value Driver System Risk Management Anti Fraud Architecture Management Payment Management Customer retention Back Office Infrastructure focused technological capabilities * Il
Slide 5: Plus500 Vision: Enabling simplified, universal access to financial markets
Delivering the future opportunity 5 Plus500 Vision: ”Enabling simplified, universal access to financial markets” Supported by our capabilities, enablers and differentiators Robust financial Strong functional Powerful proprietary Customer centric foundation and infrastructure and technology platform:
Slide 6: Plus500 growth opportunities
Delivering the future opportunity 6 Plus500 growth opportunities Capabilities, enablers and differentiators drives our ability to access growth Expand CFD offering New trading New financial Deeper customer geographically products products engagement In existing and In addition to CFDs Apart from tra
Slide 7: Continued focus on Governance and Social Responsibility
Governance and Social Responsibility 7 Continued focus on Governance and Social Responsibility Further progress in key areas in FY 2020 Developments in Governance: Social responsibility initiatives: Continued broadening of expertise and COVID-19 related activity: increasing gender diversity of the B
Slide 8: Results highlights
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Slide 9: FY 2020 Results – Operational Overview
Results highlights 9 FY 2020 Results – Operational Overview Record performance for Plus500 Driven by strength and Record levels of Unprecedented numbers differentiation of our technology platform usage: of Active Customers2 platform: and New Customers3: Unrivalled ability to respond Customer Income1
Slide 10: FY 2020 Results - Financial Highlights
Results highlights 10 FY 2020 Results - Record financial performance Financial Highlights Revenues up 146% to $872.5m EBITDA up 168% to $515.9m, Financial Performance with improvement in EBITDA margin EPS up 249% to $4.71 (2019: $1.35) FY FY H2 H2 Q4 Q4 Continued high levels of Cash 2020 2019 2020 2
Slide 11: Shareholder returns
Results highlights 11 Shareholder returns FY 2020 Shareholder Returns of $278.3m, including: $186.0m annual dividend Track record, since IPO in 2013 including final dividend of $55.6m Total shareholder returns of $1,196.4m, including $29.4m special dividend, announced today $1,008.2m in cash dividen
Slide 12: Future approach to capital allocation
Delivering the future opportunity 12 Future approach to capital allocation Increasing focus on future growth Balance of shareholder returns, investment in growth and driving business continuity New shareholder returns policy to ensure Investment in Driving business greater flexibility for future inv
Slide 13: Risk Management
Delivering the future opportunity 13 Risk Management Embedded across our business Our approach to risk management: Robust and comprehensive Delivered consistent results Continue to aim to Targeted hedging Approach aligned Customer Income ensure risk exposures implemented with our technology remains
Slide 14: Regulatory developments
Customer dynamics 14 Regulatory developments Robust Global Regulatory Framework Plus500 supportive of Very minimal financial Plus500 continues to Plus500 remains very regulatory changes impact from FCA ban operate in accordance well placed to proposed by ASIC for on sale of crypto CFDs with the appr
Slide 15: Operating review
Pluesoo Operating review
Slide 16: Key market trends in FY 2020
Operating review 16 Key market trends in FY 2020 Offers attractive growth opportunities for Plus500 Market Technology Consumer Regulation Unprecedented Further automation Increasing interest On-going regulatory market environment & user-friendly in trading scrutiny technologies Frequent opportunitie
Slide 17: Market leadership positions
Operating review 17 Leading industry positions in core markets for third year in Market leadership a row: No.1 CFD provider in the UK1 positions No.1 CFD provider in Germany2 No.1 CFD provider in Spain3 Market Share in CFD Market Recent achievements also include: UK No. 1 for satisfaction for Online
Slide 18: Technology developments - systems
Operating review 18 Technology developments - systems Continued investment in the platform to drive customer usage Significant progress made in modernising system infrastructure Consistent level of service Google Cloud Services delivered for customers implemented Particularly notable, Provides furth
Slide 19: Technology developments - product
Operating review 19 Technology developments - product Continued investment in the platform to ensure consistent customer-centric approach On-going upgrades and improvements Mobile and tablet offering remains popular to product design and visuals with customers during FY2020: Additional chart Improve
Slide 20: FY 2020 KPIs by region
Operating review 20 FY 2020 KPIs by region Excellent performances across all regions Active % annual % New % annual % Revenue % annual % ARPU % annual % Customers change proportion Customers change proportion ($m) change proportion ($) change proportion UK 73,042 138% 17% 53,135 256% 18% 109.9 185%
Slide 21: Marketing Investment
Operating review 21 Marketing Investment Cumulative average revenue per Active Customer over time Dynamic New Customer acquisition engine – driven by technology $5,000 Targeted, efficient online marketing initiatives driven $4,000 by Plus500 proprietary technology Sustained levels of significant inv
Slide 22: High Return on Marketing Investment
Operating review 22 Key: High Return on Marketing Investment 2017 2020 2016 2019 Long term revenue return consistently exceeds initial marketing investment 2015 2018 Cumulative Return Cumulative Return Cumulative Return Cumulative Return Cumulative Return 2015 Registrations in FY 2020 2016 Registrat
Slide 23: Further improvements in customer retention
Customer dynamics 23 Further improvements in customer retention Driven step change in Active Customer base, through periods of intensive market activity “Customer experience” is Active Customers, 2014 - 2020 crucial in driving retention: 500,000 Consistent level of service delivered 400,000 Introduc
Slide 24: Long term customer relationships
Customer dynamics 24 Long term customer 0-6 Months 14% 6% 7-12 Months relationships 28% 1-3 Years Key 24% FY 2020 3-5 Years 5+ Years Revenue split by Customer Tenure >1 year 66% 28% Evidence of successful customer retention 11% 11% 8% 4% More weighting to near term cohort in FY 2020 12% 23% 16% 16%
Slide 25: Financial overview
Pluesoo Financial overview
Slide 26: Plus500 – our track record of execution and delivery
Strategic overview 26 Plus500 – our track record of execution and delivery Strong operational and financial performance since IPO in 2013 – further momentum in 2020 Growing topline Low cost operating model 658% revenue growth c.57% average annual EBITDA between 2013-’20 margin 2013-’20 through drive
Slide 27: Income Statement
Financial overview 27 Income Statement Key Metrics ($m) Record year of revenue performance Driven by ability of Plus500 technology to FY 2020 FY 2019 % Change manage unprecedented levels of trading volumes Revenue 872.5 354.5 146% Selling and Marketing Expenses 315.4 138.9 127% Drove excellent growt
Slide 28: Cost profile
Financial overview 28 Cost profile 20% 80% 29% 71% Key elements ($m) FY 2020 FY 2019 * Variable Fixed FY 2020 FY 2019 % Change Advertising, technology and 221.1 95.6 131% marketing investment Lean Cost Structure Processing costs 53.0 15.8 235% Payroll and related expenses 26.0 22.6 15% Highlights fl
Slide 29: Balance Sheet
Financial overview Balance Sheet Plus500 remains debt-free Key Metrics ($m) 29 No debt on balance sheet since being established in 2008 FY 2020 FY 2019 % Change Balance Sheet further strengthened Cash and Cash Equivalents 593.9 292.9 103% Other Current Assets 16.1 14.7 10% Due to strong financial pe
Slide 30: Cash Flow
Financial overview 30 Cash Flow Significant cash generation - operating cash conversion of 106% (FY 2019: 88%) Key Metrics ($m) Driven by EBITDA growth and low capital intensive nature of Plus500 Operating Activities: FY 2020 FY 2019 Change Cash generated from operations 546.6 170.1 221% Substantial
Slide 31: Outlook
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Slide 32: Outlook and guidance
Delivering the future opportunity Our vision: 32 “Enabling simplified, universal access to Outlook and financial markets” Evolving from a technology company solely focused on CFDs to a multi-asset FINTECH FY 2021 revenue: guidance GROUP Expected to grow from more normalised levels delivered in FY 20
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Slide 34: Appendices
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Slide 35: Active Customer and New Customer KPIs
Operating review 35 Active Customer and New Customer KPIs FY 2020 and H2 2020 versus prior period Active Customers New Customers FY 20 FY 19 % change H2 20 H2 19 % change FY 20 FY 19 % change H2 20 H2 19 % change UK 73,042 30,716 138% 45,593 20,366 124% 53,135 14,932 256% 17,307 6,309 174% EEA (exc.
Slide 36: Revenue and ARPU
Operating review 36 Revenue and ARPU FY 2020 and H2 2020 versus prior period Revenue ($m) ARPU ($) FY 20 FY 19 % change H2 20 H2 19 % change FY 20 FY 19 % change H2 20 H2 19 % change UK 109.9 38.6 185% 38.2 22.4 71% 1,505 1,256 20% 838 1,100 (24%) EEA (exc. UK) 365.3 150.9 142% 110.5 89.7 23% 1,565
Slide 37: Disclaimer
Appendices 37 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 sh