Back-to-Back Buybacks: Plus500 Pledges New $60M after Previous $70M Program

<p>After
launching a $70 million share buyback program earlier this year, the
publicly-listed London broker, Plus500 (LSE: <a href="https://www.financemagnates.com/tag/plus500/" target="_blank" rel="follow">PLUS</a>), announced the commencement
of another repurchase, valued at $60 million. According to the official
statement, the company decided to take this step due to the approaching
finalization of the agenda for the first buyback.</p><p>Plus500 Buys Back Shares
Again</p><p>Plus500
claims that its latest asset buyback program underscores its strong financial position.
According to transaction details, a maximum of 8,032,980 shares are up for
repurchase, in line with the permissions granted during the general meeting
held on 24 July 2023. </p><p>Liberum
Capital Limited will oversee the <a href="https://www.financemagnates.com/terms/e/execution/">execution</a>, strictly operating within defined
parameters and without intervention from the company or its board members. All
acquired shares will be categorized as treasury (dormant) shares, meaning they
won't be eligible for dividends or voting rights at general meetings.</p><p>The buyback
program is scheduled to run until the company's preliminary results are
disclosed for the year ending 31 December 2023. Even during the company's
closed periods, the buybacks may continue.</p><p>"The
purpose of this Share Buyback Program is to further underscore the Board's
ongoing confidence in the future prospects of Plus500, reflecting the Group's
strong financial position and ability to deliver impressive future shareholder
returns," the company commented in the official statement. "This
confidence is backed by the significant operational and financial momentum
achieved by Plus500 over recent years, as the Group continues to further its
strategic roadmap."</p><p>As
mentioned earlier, this is the <a href="https://www.financemagnates.com/forex/brokers/plus500-kicks-off-share-repurchase-under-new-70m-program/" target="_blank" rel="follow">second asset buyback program</a> initiated by the
broker this year. The first was announced at the end of February, seamlessly
continuing the previous share buyback phase. It was part of a broader plan <a href="https://www.financemagnates.com/forex/brokers/plus500-announces-100m-investor-payouts-as-2022-profits-soar/" target="_blank" rel="follow">to
distribute $100 million</a> among the company's investors.</p><p>The Plus500's
share price dropped after reaching record levels at the beginning
of 2023, when a single Plus500 share was valued at nearly 2000 pence. From
February to August, it fell by almost 30% and is currently priced at 1400
pence. However, the shares <a href="https://www.financemagnates.com/forex/plus500-shares-rebounds-from-14-month-lows-following-1013-million-share-repurchase/" target="_blank" rel="follow">rebounded from the 14-month lows</a> tested in June.</p><p>Decreasing Traders'
Activity Affects Plus500's Revenue</p><p>The decline
in share value can be attributed, in part, to the deteriorating <a href="https://www.financemagnates.com/institutional-forex/plus500s-revenue-dips-28yoy-in-h1-2023-amid-declining-active-customers/" target="_blank" rel="follow">revenue
performance of the broker</a>. This, in turn, was caused by the generally reduced
activity of consumers and retail investors in the markets during the first half
of 2023.</p><p>Last week,
Plus500 published its interim results for the first half of 2023, revealing
mixed performance for the period. Despite an improvement compared to the
previous six months, Plus500's results showed a year-on-year decline of 28% in revenue.</p><p>The <a href="https://www.financemagnates.com/terms/f/fintech/">fintech</a>
company headquartered in London reported revenues of $368 million for the first
half, which is down $142 million from the $511 million during the same period seen in the
previous year. Out of this revenue, $346 million came from trading, and $22 million
was from interest income.</p><p>Plus500's
customer turnovers came in at $42 million in the year's first half. This figure
marked a sharp decline compared to the $172 million in the previous year's
first half, indicating diminishing customer activity and interest
in investments.</p>

This article was written by Damian Chmiel at www.financemagnates.com.