Plus500 revenue drops but earnings rise; new chairman announced

Online trading platform provider Plus500 reported a 9% drop in revenue for the three months to the end of March, as it announced a change of chairman.

Earnings before interest, taxes, depreciation and amortisation rose 25% to $45.8m, but revenue declined to $77.5m from $85.2m in the first quarter of last year.

The number of active customers rose 6% in the quarter to a record 71,827. However, average user acquisition cost fell by 31% compared to the same period a year ago.

Chief executive officer Asaf Elimelech said: "Plus500 is pleased to announce a strong quarterly performance, with a significant improvement in its profitability and quality of earnings. We have reported a record increase in active customers, which shows the strength of and satisfaction with our trading platform. The strong quarterly EBITDA margin and significant decrease in AUAC reflect improved efficiency and targeted marketing activity and spending.

"We have started 2017 positively; we are confident we can continue to expand and enhance our competitive position whilst successfully incorporating regulatory changes with the minimum of disruption. Our strategy is supported by our strong financial position and cash generative business model, enabling us to deliver good shareholder returns despite short term regulatory uncertainty."

Also on Wednesday, Plus500 said chairman Alastair Gordon will step down from the board following the annual general meeting on 1 June and will be replaced by Penelope Judd, who is currently a non-executive director.

The company said Judd has over 30 years of financial services experience specialising in compliance, governance, regulation, corporate finance and audit.

"Her expertise is particularly relevant given the regulatory challenges faced by the industry and the company," it said, adding that Judd will continue to chair the Regulatory and Risk Committee, which was established last year and is an important element of the company's corporate governance.

At 0950 BST, the shares were up 4% to 461.81p.