Plus500 Ltd reports 131 pp ROIC decline from 196% to 65.4% in 2019 in 2019 and 62.0% EBITDA decline
12 Feb 2020 • About Plus500 Ltd (
$PLUS) • By InTwits
Plus500 Ltd reported FY2019 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Plus500 Ltd has low CAPEX intensity: 5 year average CAPEX/Revenue was 0.2%.
- The company has highly profitable business model: ROIC is 65.4%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue dropped on 50.8%. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin dropped on 16.0 pp from 70.2% to 54.2% in FY2019.
SG&A as a % of Revenue jumped on 16.5 pp from 29.9% to 46.4% in FY2019.
Net Income margin decreased on 9.8 pp from 52.6% to 42.8% in FY2019. During the last 5 years Net Income margin topped in FY2018 at 52.6%.
Investments (CAPEX, working capital and M&A)
In FY2019 Plus500 Ltd had CAPEX/Revenue of 0.028%. CAPEX/Revenue decreased slightly on 0.55 pp from 0.58% in FY2016 to 0.028% in FY2019. It's average CAPEX/Revenue for the last three years was 0.082%. During the last 5 years CAPEX as a % of Revenue topped in FY2016 at 0.58% and was declining since that time.
Return on investment
The company operates at high and attractive ROIC (65.4%) and ROE (53.7%). ROIC dropped on 131 pp from 196% to 65.4% in FY2019. ROE dropped on 95.9 pp from 150% to 53.7% in FY2019. During FY2015-FY2019 ROIC topped in FY2018 at 196%. During FY2015-FY2019 ROE topped in FY2018 at 150%.
Leverage (Debt)
Debt level is -1.5x Net Debt / EBITDA and 0.0x Debt / EBITDA. Debt surged while cash decreased on 7.1%.
Plus500 Ltd has no short term refinancing risk: cash is higher than short term debt (18,306.3%).
Valuation and dividends
The company's trades at EV/EBITDA 3.6x and P/E 6.5x.
Financial and operational results
FY ended 30 Nov -0001
Plus500 Ltd ($PLUS) key annual financial indicators| mln. $ | 2015 | 2016 | 2017 | 2018 | 2019 | 2019/2018 |
|---|
P&L
|
|---|
| Revenue | 275.7 | 327.9 | 437.2 | 720.4 | 354.5 | -50.8% |
| SG&A | 143.1 | 177.4 | 178.7 | 215.1 | 164.4 | -23.6% |
| EBITDA | 132.8 | 151.0 | 259.2 | 506.0 | 192.3 | -62.0% |
| Net Income | 96.6 | 117.2 | 199.7 | 379.0 | 151.7 | -60.0% |
Balance Sheet
|
|---|
| Cash | 156.5 | 136.5 | 241.9 | 315.3 | 292.9 | -7.1% |
| Short Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 1.6 | |
| Long Term Debt | 0.0 | 0.0 | 0.0 | 0.0 | 4.1 | |
Cash flow
|
|---|
| Capex | 0.8 | 1.9 | 0.6 | 0.6 | 0.1 | -83.3% |
Ratios
|
|---|
| Revenue growth | 20.4% | 19.0% | 33.3% | 64.8% | -50.8% | |
| EBITDA growth | -8.7% | 13.7% | 71.7% | 95.2% | -62.0% | |
|
|---|
| EBITDA Margin | 48.2% | 46.0% | 59.3% | 70.2% | 54.2% | -16.0% |
| SG&A, % of revenue | 51.9% | 54.1% | 40.9% | 29.9% | 46.4% | 16.5% |
| Net Income Margin | 35.0% | 35.8% | 45.7% | 52.6% | 42.8% | -9.8% |
| CAPEX, % of revenue | 0.3% | 0.6% | 0.1% | 0.1% | 0.0% | -0.1% |
|
|---|
| ROIC | 116.5% | 118.9% | 143.2% | 196.2% | 65.4% | -130.8% |
| ROE | 84.7% | 92.4% | 110.3% | 149.6% | 53.7% | -95.9% |
| Net Debt/EBITDA | -1.2x | -0.9x | -0.9x | -0.6x | -1.5x | -0.9x |
Peers in Financial Services
Below we provide Plus500 Ltd benchmarking against other companies in Financial Services industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Polo Resources Ltd ($POL) | | | -93.4% | 308.5% | -44.4% |
| Impax Asset Management Group ($IPX) | | 6.8% | 55.2% | 100.9% | 12.2% |
| Afh Financial Group ($AFHP) | | 15.0% | 39.4% | 50.6% | 46.7% |
| S & U ($46IE) | -40.6% | 25.2% | 33.9% | 31.8% | |
| Real Estate Credit Investments Pcc ($RECP) | 47.3% | -29.8% | 4.0% | 30.7% | |
| |
|---|
| Median (18 companies) | 2.8% | 5.0% | 12.3% | 17.1% | 12.2% |
|---|
| Plus500 Ltd ($PLUS) | | 19.0% | 33.3% | 64.8% | -50.8% |
Top companies by Gross margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Record ($REC) | 99.3% | 99.0% | 98.8% | 98.7% | |
| First Property Group ($FPO) | 83.0% | 80.6% | 78.6% | 76.3% | |
| Walker Crips Group ($WCW) | 66.7% | 67.7% | 69.8% | 67.2% | |
| Afh Financial Group ($AFHP) | 52.3% | 55.4% | 53.4% | 54.4% | 53.4% |
| S & U ($46IE) | 65.3% | 63.3% | 58.6% | 53.8% | |
| |
|---|
| Median (8 companies) | 52.5% | 59.3% | 51.4% | 54.1% | 35.9% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Real Estate Credit Investments Pcc ($RECP) | 80.3% | 79.3% | 79.5% | 81.8% | |
| Hargreaves Lansdown ($HL.) | 51.2% | 57.5% | 69.3% | 66.8% | |
| First Property Group ($FPO) | 42.9% | 52.2% | 57.4% | 52.9% | |
| S & U ($46IE) | 47.2% | 48.0% | 44.8% | 41.7% | |
| Record ($REC) | 34.4% | 33.7% | 35.7% | 32.6% | |
| |
|---|
| Median (16 companies) | 16.9% | 17.2% | 20.9% | 22.2% | 29.5% |
|---|
| Plus500 Ltd ($PLUS) | 48.2% | 46.0% | 59.3% | 70.2% | 54.2% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| First Property Group ($FPO) | 0.1% | 6.4% | 8.5% | 9.4% | |
| Walker Crips Group ($WCW) | 2.5% | 0.9% | 1.7% | 5.4% | |
| Mxc Capital ($MXCP) | 0.5% | 4.9% | 0.0% | 4.7% | 0.2% |
| Commercial Bank Of Qatar(The) ($CBQS) | 3.9% | 3.3% | 1.8% | 3.8% | 1.9% |
| Impax Asset Management Group ($IPX) | 0.8% | 0.5% | 1.1% | 2.6% | 0.5% |
| |
|---|
| Median (17 companies) | 1.0% | 1.0% | 1.0% | 1.0% | 0.5% |
|---|
| Plus500 Ltd ($PLUS) | 0.3% | 0.6% | 0.1% | 0.1% | 0.0% |
Top companies by ROIC, %
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| Hargreaves Lansdown ($HL.) | 87.5% | 90.0% | 93.3% | 82.4% | |
| Impax Asset Management Group ($IPX) | 16.1% | 15.0% | 19.7% | 30.7% | 28.8% |
| Fulcrum Utility Services Ld ($FCRM) | | 347.2% | 103.4% | 29.9% | |
| Record ($REC) | 20.2% | 18.5% | 20.7% | 22.0% | |
| Numis Corp ($NUM) | 22.3% | 25.2% | 26.3% | 20.5% | 7.7% |
| |
|---|
| Median (24 companies) | 7.6% | 7.5% | 8.5% | 5.8% | 8.6% |
|---|
| Plus500 Ltd ($PLUS) | 116.5% | 118.9% | 143.2% | 196.2% | 65.4% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2015 | FY2016 | FY2017 | FY2018 | FY2019 |
|---|
| First Property Group ($FPO) | 12.3x | 9.4x | 7.6x | 7.7x | |
| S & U ($46IE) | 3.1x | 0.5x | 1.8x | 3.2x | |
| Leeds Group ($LDSG) | -0.3x | 1.4x | 2.6x | 2.5x | |
| Impax Asset Management Group ($IPX) | -0.5x | -0.6x | -2.0x | -0.3x | -0.5x |
| Hargreaves Lansdown ($HL.) | -1.1x | -0.9x | -0.3x | -0.4x | |
| |
|---|
| Median (13 companies) | -1.1x | -1.4x | -1.6x | -0.9x | -0.5x |
|---|
| Plus500 Ltd ($PLUS) | -1.2x | -0.9x | -0.9x | -0.6x | -1.5x |
