FCA regulated Forex and CFD broker Plus500 Ltd (LON:PLUS) has issued a Half Year Trading Update, indicating that its business did very well in the just-completed second quarter of the year.
Without giving specific numbers, which will be delivered in early August, Plus500 stated that the business has continued to trade very strongly, with both revenues and profits for the full year on track to be significantly ahead of current market expectations.
The other interesting note in the update was that Plus500’s user acquisition cost was dropping, and that in a very and increasingly competitive UK online trading market.
Plus500 has grown to be the #2 online CFDs broker in the lucrative UK market, behind only market leader IG Group Holdings plc (LON:IGG). The company initiated a planned $10 million share buyback program last month, to last through the end of August.
The full text of the Plus500 Trading Update follows:
3 July 2017
Plus500 Ltd. (“Plus500” or “the Company”)
Half Year Trading Update
Current trading significantly ahead of market expectations
Plus500, a leading online service provider for retail customers to trade CFDs internationally, today announces that following the announcement made on 2 June 2017, the business has continued to trade very strongly.
As a result, the Company now anticipates that revenues and profits for the year ending 31 December 2017 will be significantly ahead of current market expectations.
The first two quarters of the year saw very positive trading which has exceeded the Board’s expectations with strong new customer sign ups and reduced AUAC (average user acquisition cost). Overall this has delivered a higher EBITDA margin than the same period last year.
The outcome of the year will be subject to the balance between the benefit of the positive trading conditions from the two quarters continuing, set against the possible negative impact of the expected regulatory changes in a number of our countries of operation. The FCA is now expected to implement its conduct rules in the first half of 2018.
FCA and ESMA announcements
With regards to the announcements made by the FCA and ESMA on the 29 June, Plus500 welcomes a co-ordinated approach by regulators and consistent conduct rules across all European jurisdictions. The Company supports changes to regulation that will enable the industry to become more sustainable with only compliant providers. The Company retains a highly flexible business model which we believe will allow us to be one of the leaders in the sector.
Notice of Results
The half year results for the six months ended 30 June 2017 will be announced on 7 August 2017.
Asaf Elimelech commented:
“We have had a very successful half year, significantly ahead of our expectations. This puts us in a strong position for the remainder of the year. We are confident that our flexible business model will enable us to adapt to the upcoming regulatory changes and gives us a competitive advantage that will enable us to deliver another excellent performance this year.”
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (“MAR”). Upon the publication of this announcement via Regulatory Information Service (“RIS”), this inside information is now considered to be in the public domain.