Plus500 Ltd. (LSE: PLUS) has declared today its intention to initiate a fresh £100 million share repurchase programme.
This announcement comes as the publicly-listed broker nears the conclusion of its ongoing £60 million buyback launched in August 2023.
In response to this latest development, PLUS shares commenced trading on Thursday on the London Stock Exchange, exhibiting an opening gap of over 3%.
The Board interprets the new programme as affirming their “continued confidence” in Plus500’s future growth prospects and its “ability to deliver strong future shareholder returns.”
This confidence is rooted in the significant operational and financial momentum gained in recent years as Plus500 advances along its strategic roadmap.
Having concluded the fiscal year 2023 with a group revenue of £726.2 million, the company resolved to return £175 million to its shareholders.
The maximum number of shares to be repurchased under the programme is 4.8 million, falling within the parameters of the authority granted by shareholders at July’s general meeting.
Purchases will be executed through open market transactions, overseen day-to-day by Liberum Capital.
Liberum will conduct the non-discretionary buyback according to pre-defined guidelines, independently 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,” Plus500 remarked in the official statement.
Shares acquired under the programme will be held as treasury shares without entitlements to dividends or voting rights.
The share buyback programme will run from 22nd February until 31st December and may continue during closed periods.
Plus500 will disclose details of any purchases completed by 7AM the following business day.
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, underlining its commitment to returning value to shareholders.
Since the initiation of its buyback programme 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,” remarked David Zruia, the CEO of Plus500. “2023 saw further progress against all three strategic objectives.”
Focusing on multi-asset brokerage services, the firm has observed a blend of dynamics in customer engagement. The fiscal year 2023 report indicates that 90,944 new clients joined the platform, marking a decrease of 15% compared to the previous year. Concurrently, the number of active clients decreased by 17% to 233,037.