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Plus500 Ltd: Intention to IPO and Seek Admission to AIM


    Plus500, which has developed and operates an online trading platform for retail customers to trade CFDs (Contracts for Difference) in over 50 countries, announces today its intention to launch an initial public offering (“the Offer” or “IPO”) and seek admission of its ordinary shares to trading on AIM, a market operated by the London Stock Exchange. The Offer will seek to raise gross proceeds of up to US$50 million via a placing of new and existing ordinary shares (“the Placing”). Liberum Capital Limited is acting as Nominated Adviser and Broker.

    Plus500 has developed and operates an online trading platform (www.plus500.com) for retail customers to trade CFDs internationally over more than 1,700 different underlying global financial instruments comprising equities, ETFs (Exchange-Traded Funds), foreign exchange, indices and commodities.

    Highlights include:

    Scalable Business Model

    • The Directors believe that the success of the Group to date has been primarily due to the self-developed, proprietary technology it has developed and continues to develop to support the Trading Platform. The Trading Platform provides a simple and consistent interface for customers across a number of different devices. It has been designed to be as intuitive and easy to use as possible and is able to provide customers with real-time prices, execution facilities and a multitude of order types.
    • In addition, the Directors believe that the Group’s business model is scalable as a result of the level of automation in the Trading Platform and that there is significant scope for the Trading Platform to process more trades.
    • The Group’s marketing strategy is to focus on investing in targeted and cost-effective marketing initiatives which provide measurable results for the Group. The Group has developed proprietary marketing software which helps the Group to monitor the effectiveness of online marketing campaigns and inform marketing spend.

    Experienced management team and robust controls:

    • All of the founders are actively involved in the Group’s business, including Board members, Gal Haber, CEO, and Alon Gonen, Managing Director.
    • The Group manages risk in a number of ways, in particular by limiting financial exposure to any individual customer to a relatively low level as well as limiting exposure to any individual instrument. The Group also has in place a hedging policy designed to further manage risk.

    Revenue and profit growth:

    • During the year ended 31 December 2012, the Group had over 58,000 active customers (2011: over 45,000) and closed over 10,000,000 trades.
    • For the year ended 31 December 2012, the Group generated a profit before tax of US$23,073,000 on revenues of US$56,127,000. Unaudited consolidated results for the three months ended 31 March 2013 saw the Group achieve a profit before tax of US$6,999,000 on revenues of US$19,796,000.

    Reasons for Admission:

    • The Directors believe that an increasing awareness and willingness for customers around the world to trade derivative products such as CFDs will offer growth potential to the Group.
    • The Directors believe that Admission will increase the profile of the Group in the UK and internationally, thereby helping to attract new customers, as well as providing liquidity in the ordinary shares.
    • The Group´s net proceeds of the Placing will be used to invest in additional marketing activities to increase brand awareness; penetrate new markets and accelerate growth in existing markets; strengthen the Group’s balance sheet and capital base; give the Group additional flexibility when assessing potential acquisitions; and maintain reserve capital surplus to the Group’s existing mandatory regulatory capital requirements.

    Gal Haber, Chief Executive Officer of Plus500, commented,

    “We have worked hard to develop and grow Plus500 over the last five years. Our focus on a self-developed trading platform, underpinned by proprietary technology, has enabled us to expand in key regions in a relatively short period of time.

    The CFD market continues to expand and our planned IPO is the next evolutionary step in our development.

    We believe that there is a significant opportunity to provide a user friendly and reliable CFD trading platform to retail customers and the Company’s Admission to AIM and Placing will support our growth ambitions.”