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CFD broker Plus 500 has put out its latest trading update, covering the last quarter of 2017, and is indicating that revenue for the period was better than expected. As such the share price jumped to a yearly high giving the company founded in 2008 a market cap of £1.31bn.
The company, which offers retail customers the chance to trade on CFDs and other financial products, reported that it saw momentum in terms of trading and attracting new clients at the end of 2017 and that it achieved record quarterly revenue, as well as attracting a total of 246,000 new customers for the year, compared to 104,400 during 2016.
As a result, Plus 500 is expecting final revenue and profit figures for the calendar year 2017 to be in excess of expectations. The latest news comes after the company, which recently announced an expansion into the Singapore market, recorded strong Q3 results. Revenue for Q3 was $116.5 million, with EBITDA at $70 million and Net Income at $52.5 million.
Although the trading update didn’t offer specific information on revenue sources, the company did credit a large proportion of the increase to its cryptocurrency trading markets. Plus500 was among the first financial trading brokers to offer cryptocurrency trading products when Bitcoin was introduced in 2013. Although Plus 500 does still not offer financial spread betting which means clients trading bitcoin must pay capital gains tax on profits.
Plus 500 was one of a number of players in the market to suffer a drop in share price in the middle of December, following news that the European financial regulator ESMA was planning to introduce regulatory reforms, including a cut in the maximum level of leverage permitted in trading. The proposals are likely to be introduced in the first quarter of 2018, although Plus500 had seen something of a recovery in share price over the last two weeks.
Commenting on the trading update, the company’s Chief Executive Officer, Asaf Elimelech, highlighted the strong performance of the cryptocurrency CFD product:
“We are pleased to announce another strong period in both revenues and profits. Momentum in the business has continued to be strong with increased interest in our crypto currency CFD offering and record new and active customer numbers.”
The company is likely to produce a preliminary report on results for the financial year to December 31 by the end of February.
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