Plus500 forecasts full year revenue and profitability to be ahead of consensus expectations

Maria Nikolova

The brokerage says revenue from Customer Income has been very strong due to the heightened levels of market volatility.

Online trading company Plus500 Ltd (LON:PLUS) today issued an update regarding the ongoing period of increased market volatility resulting in heightened volumes of trading.

The brokerage says it continues to see a significantly increased level of customer trading activity alongside strong momentum across all financial and operational KPIs. The company has seen strong revenue from Customer Income due to the heightened levels of market volatility. Plus500 says it has also experienced gains from Customer Trading Performance which is expected to be neutral over time.

The company notes that it is at an early stage of the financial year and given the uncertainty regarding the duration of current levels of volatility or the unquantified potential impact from regulatory changes in Australia, it remains difficult to predict the outcome for the full year at this stage.

However, Plus500 forecasts revenue and profitability for the full year to be substantially ahead of current consensus expectations.

Less than a month ago, the broker issued an upbeat message reporting a significant increase in levels of customer trading activity. The Group’s financial performance during the first quarter to date is consequently trending substantially ahead of the last quarter of 2019, Plus500 said.

Let’s recall that Plus500 reported total revenues of $354.5 million for 2019, down 51% from $720.4 million registered a year earlier. EBITDA for 2019 was $192.3 million (FY 2018: $506.0 million), with an EBITDA margin of 54% (FY 2018: 70%). Net profit for 2019 was $151.7 million, down 60% from $379 million registered a yea earlier. Earnings per share were $1.35 (FY 2018: $3.33). The new year appears to be starting on a much more positive note for the company.

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