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Plus500 trading ticks up after tense geopolitical times

Plus 500's chief executive said the FTSE 250 company is on track to meet its expectations for the full year

The online trading platform has suffered from regulatory crackdowns on contract for difference tradeing

Shares in Plus500 (LON:PLUS) soared higher on Tuesday after the firm revealed that its revenues rose by 10% to US$110.6mln in its third-quarter as trading momentum picked up as a result of tense times in world geopolitics.

In a Q3 trading update on Tuesday, the online trading platform said its average revenue generated per user climbed to US$997, up 15% compared to the previous three months, driving sales despite new user growth slowing by 7%.

In total, the number of ‘active’ customers, who made at least one trade during the reporting period, trickled up by 2% to 110,939 on the previous three months.

The company's underlying profit (EBITDA) in the third-quarter topped US$70.1mln, a 39% increase in comparison to the same period last year, with margins continuing to grow from quarter to quarter to 63%, up from 57% three months ago.

Plus 500 has had a rocky time over the past year, with its shares halving since February when it issued a profit warning saying tighter regulations in Australia were causing a slump in CFD (contract for difference) trading, sending revenues down from its mega-year in 2018 when it was boosted by surging cryptocurrencies.

The group said that if Australia proceeds with the crackdown, it could affect up to 15% of its Australian sales in the nine months ended 30 September 2019, but it remains optimistic that over time the ruling could reduce the number of its competitors, enabling it to grab market share and lower the spend on acquiring new customers.

Plus 500 chief executive Asaf Elimelech said the company is on track to meet its expectations for the full year.

Elimelech said: "Like all operators in the sector, Plus500's performance for the remainder of the year is dependent, among other things, on financial market conditions providing sufficient trading opportunities for customers.”

In early morning trading, Plus 500 shares were 6.9% higher at 842.60p.


Quick facts: Plus500 Ltd

Price: 1469.5 GBX

Market: LSE
Market Cap: £1.56 billion

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