Plus500 Ltd (LON:PLUS) has said it expected its full year revenues and earnings to be in line with current forecasts following what it said was “significant year-on-year growth” in its third quarter.
In an update for the three months to September 30, the online Contracts for Difference (CFD), forex and crypto trading broker reported earnings (EBITDA) of US$134.2mln, a 91% increase on the prior year, while revenues also soared 96% to US$216.4mln.
READ: Plus500 shares stumble despite boast of continued 'outstanding' trading
The surge in the financials came alongside a strong rise in new customers, which jumped 90% year-on-year to 46,238, while the number of active customers was up 78% at 197,976.
Plus500 attributed its performance to its “market-leading technology” which it said allowed to its continually benefit from heightened platform usage during “unprecedented levels of market volatility”.
Looking ahead, the firm said it continued to be “very confident about the outlook for the business” despite uncertain market conditions, highlighting that its third quarter was the second highest quarterly level of customer income in the history of the group, although down slightly from the record peak in the second quarter.
The company also said this gradual reduction from the peak has continued into the fourth quarter, although the full year performance was expected to still be in line with consensus forecasts.
"Plus500 has delivered an excellent performance during [the third quarter of] 2020, building on the positive momentum already achieved in the first half of the year. This performance has been driven by the quality and differentiation of our proprietary technology, which has enabled our business to consistently support our customers in these unprecedented market conditions”, chief executive David Zruia said in a statement.
"Given Plus500's exceptional performance this year to date, and with macroeconomic and sector-specific news flow continuing to provide significant trading opportunities for our customers, we remain very confident about the outlook for the business", he added.
In a note on Tuesday, analysts at house broker Liberum reiterated their ‘buy’ rating and 1,950p target price on the stock, saying that the “better than expected” quarterly results were “due to more than just favourable market conditions. They also reflect the benefits of the group’s best-in-class platform, which continues to deliver despite lower leverage limits”.
“[Plus500’s] scalable technology and agile marketing algorithms has enabled it to win significant market share and drive continued improvement in financial returns. With the group having already surpassed our previous [2020] EBITDA estimate, we increase our forecast by 8%”, the broker added.
Despite the positive financial performance, shares in the company turned 5.2% lower to 1,537p in early trading.