- 2024 guidance upgraded again
- Cash pile tops $1 billion
- Additional $185.5 million of returns
Plus500’s (PLUS) shares powered up 5.3% to an all-time high of £25.60 in early dealings on Monday after the online trading platform raised its full year guidance yet again.
The upgrade follows an ‘excellent’ first half to 30 June 2024 from the spread betting and CFDs (Contracts for Difference) provider, which profited from market volatility and its expansion into new geographies and products over recent years.
With cash balances exceeding $1 billion for the first time as of 30 June, more than half Plus500’s current market cap, the company also announced $185.5 million in new distributions comprising share buybacks of $110 million and total dividends of $75.5 million.
AN EXCELLENT START
Plus500 reported an excellent start to its financial year, with revenue up 8% in the first half to $398.2 million, EBITDA (earnings before interest, tax, depreciation and amortisation) 6% ahead at $183.9 million and net profit nudging up from $146.5 million to $148.8 million.
Growth was fuelled by a rise in trading income and customer activity, with customer income, a key measure of Plus500’s underlying performance, rising 8% to $329.4 million.
The self-styled multi-asset fintech group now expects year-to-December 2024 sales and EBITDA will both be ‘ahead of current market expectations’ - $697.8 million and $314.6 million respectively based on Bloomberg consensus forecasts - drawing confidence from the strength of its position in growing end markets and its successful growth efforts in the US, Japan and UAE markets.
WHAT DID THE CEO SAY?
CEO David Zruia said his charge continues to be guided ‘by our strategic ambitions - to expand into new markets, develop new products and deepen engagement with our customers.
‘We delivered growth in revenue and EBITDA, continued to expand our geographic footprint, developed innovative new products and, as a result, saw an increase in new and active customer numbers year-on-year.’
Zruia added: ‘Plus500 remains strategically well positioned to capitalise on both short-term market conditions and the medium-term growth trends in our end markets. The proprietary nature of our technology is what differentiates Plus500, creating an exceptional experience for our customers.’
THE JEFFERIES VIEW
Jefferies, which has a discounted cash flow-based price target of £28 on the stock, observed that Plus500 has now made profits of $2.7 billion since its IPO (initial public offering), of which $2.3 billion, including today’s announced returns, has or will be returned to shareholders.
‘Recent entry to the US market, both retail and institutional, is exciting, and we expect the full year results will give the market some more specific details to bolster enthusiasm,’ said the broker.
‘No company listed in London has provided higher distributions over the last decade, and Plus500 continues to strengthen.’
