Plus500 share price rockets after doubling first half underlying profit

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Plus500 sponsors Spanish football club Atletico Madrid (Source: Getty)

Shares in spreadbetting firm Plus500 were up almost 13 per cent this morning after the group reported a record first half performance.

The figures

Underlying profit doubled to $118.5m (£90.8m) during the first half.

Revenues grew 19 per cent to $188.4m, as the number of new customers in the second quarter grew 43 per cent to 31,671.

The group also reported that it had managed to decrease the cost of acquiring each new customer by 37 per cent to $836 per person.

Read more: Plus500 shares jump as spreadbetter unveils cheery trading update

Why it's interesting

After taking a hammering at the end of last year, Plus500 shares have recovered lost ground and are edging towards one-year highs.

The firm's stock was hit at the end of December when the Financial Conduct Authority (FCA) revealed a crackdown on the spreadbetting sector. Plus500, alongside listed rivals IG Group and CMC Markets, saw a huge chunk wiped off its market capitalisation when the plans were announced last December.

Regulators are eager to protect less sophisticated investors. They proposed capping the level of risk investors can take and banning new customer offers.

The FCA has now handed over the reins to European authorities, which plan to introduce reforms in early 2018.

Read more: Shares in cash-rich Plus500 leap on share buyback

What the company said

Chief executive Asaf Elimelech said: "Plus500 achieved record first half results, significantly ahead of market expectations. New Customers continue to join and the proportion of both new and active customers originating from well-regulated markets is growing and continues to expand the group's community of high-quality customers.

As a leading player in the industry, we are committed to provide all our customers with the most comprehensive product offering alongside best practice regulation. Our trading platform therefore provides all our customers, of all experiences, a protection mechanism to prevent them losing more than their account balance.

We believe that the current regulatory changes will promote a consistent set of conduct rules across all European jurisdictions which will ensure a more sustainable industry, of which we intend to continue to be one of the leaders.

Read more: Plus500 confident it can deal with FCA crackdown and commits to London

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