Plus500 reports weak financials for Q3, but YTD metrics remain robust
Israeli-based, but London-stock market listed Plus500 said it expects annual revenue and earnings to be ahead of analysts’ estimates even as trading levels normalised from record volumes in the third quarter.
As reported by the fintech company in its financial statements submitted this afternoon to London Stock Exchange, the group’s revenues amounted to $706 million in the nine months through September 2022. This figure was nearly 27 percent higher when weighed against the $557 million it reported for the same period in 2021.
But taking a quarterly perspective, Plus500 reported that its revenue between July and September were $194 million, down by almost 8 percent from $211 million in the third quarter of 2021. The pattern was much the same for its core profits.
At the bottom line, the spread betting and CFDs broker told investors that it earned $407 million so far in 2022, which was also higher by 29 percent from $316 million in 2021. However, Q3 2022’s EBITDA dropped 21 percent to $102 million from $128 million in the same quarter of 2021.
Notably, the group continued to add fewer active accounts, saying that 250,553 new accounts were added during the first nine months of FY 2022. The figure was down by a third from the 367,573 clients it onboarded the previous year.
Plus500, which recently ended its sponsorship deal with Atlético de Madrid, also saw its Average Revenue Per User (ARPU) improving to $2,817 on a year-to-date basis, up 86 percent from $1,517 in 2021. The figure also rose to $1,445 in the third quarter from $1,271 the year prior. Plus500 attributed the better AUAC result to the proportion of high value customers, which also provides potential for increased future revenues.
In terms of the Average User Acquisition Cost (AUAC), Plus500 reported a meaningful increase as the onboarding costs nearly doubled year-over-year to $1,487, which was well above $750 in 2021.
“AUAC during the first nine months of FY 2022 was $1,487 (YTD 2021: $750), driven by the Group’s continued significant investments to attract high value, long term customers, through various marketing and retention initiatives. With further investments expected to be made going forward, to help deliver consistent future returns, the Group continues to expect that AUAC will rise steadily over time,” it further explains.
David Zruia, Chief Executive Officer of Plus500, commented: “Plus500 has continued to outperform in 2022, driven by the power of our market-leading proprietary technology and our on-going ability to attract and retain higher value, long-term customers. We have made further traction in delivering against our strategic priorities, in particular in starting to access the major growth opportunities available in the US. Supported by continued investment in growth, we continue to diversify and develop the business as a global multi-asset fintech group, ensuring Plus500 remains well-positioned to deliver sustainable growth over the medium to long-term.”