PLUS500 Reports 70% Growth in Earnings, Aided by Strong Revenues from Cryptocurrency Trading - The Industry Spread

Karthik Subramanian

Karthik Subramanian has been a professional trader and fund manager over the last 18 years. He is basically a software developer who made the transition to financial domain around 18 years back as the attractiveness of the financial markets proved too much for him. He lives in Chennai in India along with his wife and son. He began his career as a software developer in 1999 and then gradually moved into the financial industry as he began trading stocks in his pastime. He then moved into the financial markets full time and then shifted his focus to the FX markets due to the liquid nature of these markets. Since then, he has been trading FX diligently and his favourite pair are the EURUSD and EURJPY. Over the last couple of years, he has found blockchain to be of high interest and considering his background in software and finance, he has since assembled a team of highly talented developers who have since worked on a variety of projects like crypto exchanges and blockchain architecturing. Now, he balances his time between trading and commenting on both the FX and crypto markets. He has worked with many publications including FX Street and Finance Magnates, which has helped him gain experience and also recognition across the industry. He loves to write and this passion has helped him to reach out across the FX and crypto industry. Right now, he works on his pet projects in the FX and crypto industry and spends his time writing and managing his blockchain team and helping it to reach higher.

Plus500

PLUS500 Reports 70% Growth in Earnings, Aided by Strong Revenues from Cryptocurrency Trading

February 16, 2018

CryptocurrenciesPLUS500 (LON: PLUS), UK’s #2 CFD broker, only behind industry leader IG Group Holding Plc has logged 70 percent jump in profit aided by cryptocurrency trading revenue. PLUS has reported its financial metrics for both full year and Q4 in which it posted 33 percent growth in revenue during the full year compared to 2016.

In the full year, the company reported $437.2 million of revenue compared to $327.9 million in 2016. The fourth quarter proved to be stellar for the brokerage house as it reported $132.3 million of revenue, a 14 percent increase over the previous quarter. In contrast, the company never reported a revenue quarter above $85 million before 2017.

The company earned $259.2 million in EBITDA in 2017, a 72 percent rise from 2016 figures at $151 million. Net Profit came in at $199.7 million, up 70% compared to 2016’s $117.2 million. The revenue from Cryptocurrency CFDs trading was roughly around 15 percent during the year. The platform was initially introduced in 2013, but recent volatility and surreal gains in values have attracted punters to bet on the asset class. 

The Israel based company has announced a dividend per share of $1.7 for 2017, almost double than previous year and a $7.5 million share buyback programme during the year representing a total outflow of 100 percent of net profit for 2017. 

PLUS500 has also able to sign up new customers during the year with 136 percent increase year-over-year, many of which are attracted by the cryptocurrency derivatives trading. The average cost per acquisition of new customers has also gone down drastically from $1,195 in 2016 to $474 during 2017.

In 2017, the group’s 76 percent revenue was contributed from European region and the group is diversifying geographically. The company has secured a license to operate in South Africa and a commodities broker license in Singapore. The company is also witnessing a record financial KPIs in the early weeks of Q1, 2018 indicating higher trading volumes and bottom line during 2018.

Asaf Elimelech, CEO of Plus500 said:

We are pleased to announce record annual results which have demonstrated the significant operational leverage inherent in our business model. Our continued focus on serving our customers’ trading needs through product innovation and technology leadership, combined with our successful marketing activity, has led to strong new customer sign-ups, reduced churn in the second half and increased customer activity.

We continue to have a highly flexible business model, a lean cost structure and geographically diversified revenues and operations that help mitigate the impact of regulatory changes on our financial performance. Overall, we anticipate that the industry will consolidate around a smaller number of larger participants, of which we believe Plus500 will be among the leaders.

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