Plus500 Ltd announced today (Tuesday) a new share buyback program totaling up to $110 million. It follows a recently completed $100 million buyback initiative announced in February and is part of a larger $185.5 million shareholder return package unveiled in the company's H1 2024 results a few weeks ago.

Plus500 Launches Next Share Buyback Program

“The newest share buyback, reflects the Group's robust financial position, cash-generative business model and ongoing ability to deliver strong shareholder returns over the medium-term,” the company commented in the announcement.

Plus500 has a long history of buying back its own shares from the market. Such actions usually have two goals: increasing value for shareholders and allowing the company to use excess cash effectively. For publicly traded companies, this is also an opportunity to gain tax benefits, improve financial ratios, and consolidate ownership.

“As of 30 June 2024, the Group held over $1bn of its own cash on its balance sheet for the first time, enabling it to pursue organic and inorganic growth initiatives, whilst also delivering attractive and sustainable returns to shareholders,” Plus500 added.

Under the program's terms, Plus500 is authorized to repurchase up to 5,694,522 shares. The buyback will be executed in open market transactions and managed by Panmure Liberum Limited, operating under pre-defined parameters without discretionary input from Plus500 or its board members.

The program will run from today until March 31, 2025, with the company retaining the right to continue purchases during any closed periods within this timeframe. All repurchased shares will be classified as treasury shares, with no dividend rights or voting privileges at general meetings.

How Do Plus500’s Financial Results Look?

Recent financial data for Plus500 reveals a mixed performance. In the second quarter of 2024, the company generated revenue of $182.6 million, marking a 14% increase compared to the same period last year. However, this figure represents a 15.3% decrease from the $215.6 million earned in the first quarter of 2024.

EBITDA followed a similar pattern, rising 11% year-over-year to $81.3 million but falling 20.7% compared to the previous quarter. The quarter's EBITDA margin stood at 45%, which is 2 percentage points lower than the same quarter in the previous year.

On a positive note, Plus500 saw growth in its customer base. Between April and June, the company added 24,810 new customers, an improvement from the 22,248 new customers acquired during the same period in 2023.

Plus500 maintains a high revenue per client metric, currently at $3,115. However, it's worth noting that the company has been surpassed in this regard by another publicly traded firm in London, CMC Markets, whose value has increased to $5,816.