Plus500 Ltd. (LSE: PLUS) announced today that it will commence a new $100 million share repurchase initiative. This comes as the publicly-listed broker nears completion of its existing $60 million buyback launched in August 2023. In response to the latest news, PLUS shares opened on Thursday on the London Stock Exchange with a gap of over 3%.
Plus500 Puts $100M toward Share Repurchases
The Board views the new program as underscoring their “continued confidence” in Plus500's future growth prospects and “ability to deliver strong future shareholder returns.” This confidence stems from the significant operational and financial momentum achieved in recent years as Plus500 makes progress on its strategic roadmap.
The company decided to return $175 million to the shareholders as it ended the fiscal year 2023 with a group revenue of $726.2 million. The maximum number of shares to be repurchased in the program is 4.8 million. This falls within the parameters of the authority granted by shareholders at July's general meeting. Purchases will occur through open market transactions, managed day-to-day by Liberum Capital. Liberum will conduct the non-discretionary buyback according to pre-defined guidelines, independent of the Board's influence.
“Plus500's disciplined approach to capital allocation and cash generative business model enables it to invest in growth, both organically and through strategic bolt on acquisitions, maintain a clear dividend policy and return value to shareholders in the form of share repurchases where appropriate,” the Plus500 commented in the official statement.
Shares acquired under the program will be held as treasury shares without entitlements to dividends or voting rights. The share buyback program will run from 22 February until 31 December and may continue during closed periods. Plus500 will announce details of any purchases completed by 7AM the following business day.
Plus500 Continues to Buyback Shares
Over recent years, Plus500 has been actively repurchasing its shares from the market. In the previous fiscal year, the company invested $257.5 million in buying back its shares and paid out $90 million in dividends, underscoring its commitment to returning value to shareholders.
Since the initiation of its buyback program in 2017, Plus500 has acquired 36,651,165 of its own shares, spending a total of $0.6 billion. These shares were purchased at an average price of £13.52 each, reflecting a strategic approach to share repurchase. The last round of share buyback was announced last August and amounted to $60 million.
“Three years ago, Plus500 presented its new strategic plan to become a global, multi-asset fintech group, by expanding into new markets, developing new products, and deepening relationships with customers,” David Zruia, the CEO of Plus500, said. “2023 saw further progress against all three strategic objectives.”
Focusing on multi-asset brokerage services, the firm has seen a mix of dynamics in customer engagement. The fiscal year 2023 report shows that 90,944 new clients joined the platform, marking a decrease of 15% compared to the prior year. Simultaneously, the number of active clients fell 17% to 233,037.
