Earlier today Playtech PLC (LON:PTEC) announced share placing in a bid to support its future acquisitions in the online trading sector. In the filing with the LSE, the company included information on the financial and operating performance of its core business: TradeFX / Markets.com.
You may recall that in April 2015, Playtech agreed to pay €208 million in cash plus payments totaling up to €250 million, based on future performance, to acquire a stake of 91.1% in TradeFX Limited. TradeFX is a holding company whose key business is Safecap Investments Limited, which operates several online trading brands, including Markets.com, TopOption, ForexYard, Finexo, Trade.com, OnlyOption, 24winner, and FireOptions.
Today Playtech said TradeFX has been delivering some solid numbers this year.
During the first five months of the year, TradeFX saw its net revenues from trading reach $42.2 million, which is remarkable 72.2% higher than in the equivalent period in 2015, when net revenues amounted to $24.5 million.
Playtech attributed TradeFX’s success to the execution of its strategy, including the growth in popularity of the mobile application and the effectiveness of its approach to marketing, generating improved performance in its key business metrics of Active Customers and FTDs.
- FTDs for core CFD B2C business to 31 May 2015 amounted to 18.2k, up 34% from 13.6k in same period in 2014.
- Active customers for core CFD B2C business to 31 May 2015 totaled 32.0k, up 30% from 24.6k in same period in 2014.
At Playtech’s core business, average daily run rate revenue for Q2 2015 is up over 25% when compared with Q2 2014.
Before its acquisition by Playtech, the TradeFX Group secured an option to acquire another mid-size B2C broker. Playtech says the business in question is licensed in several jurisdictions, including in Europe. The expected consideration to acquire this business is approximately €100 million.
In conclusion to this article, dedicated to the performance of Playtech’s core business units, we should perhaps add that Plus500 Ltd (LON:PLUS), which Playtech proposes to acquire for 400p per share, has recently updated on its financial metrics. Its current expectation is that the Plus500 Group revenue in 2015 will be slightly lower than in 2014.
In addition, the Plus500 board of directors says that it is in the interests of the Plus500 Group to keep up with its investment in marketing in order to maintain its customer base, which will result in a substantially lower margin in 2015 than in 2014. However, this is consistent with a return to solid revenue growth in 2016.
To view detailed data on TradeFX/Markets.com’s metrics for the first five months of 2015, click here.