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Plus500 Ltd.
Annual Report 2022
BEST-IN-CLASS
TECHNOLOGY
TO ENABLE
ACCESS TO
FINANCIAL
OPPORTUNITIES
Excellent performance achieved, driving strong
revenue and EBITDA growth:
+ Powered by the Group’s proven business model and
market-leading proprietary technology
+ Evidenced by Plus500’s on-going ability to attract and
retain higher value, long-term customers, with over 24
million worldwide customers registered on its trading
platforms since inception
Significant progress made in accessing the substantial
institutional opportunity in the US futures market:
+ New B2B business line with major revenue opportunity,
based on a new strategic position developed by the Group
as market infrastructure provider, delivering execution,
clearing and brokerage services for institutional clients
+ Full clearing firm memberships of the CME Group
exchanges and the Minneapolis Grain Exchange (MGEX)
obtained
Major headway achieved in accessing the sizeable and
growing US futures retail trading market:
+ ‘TradeSniper’, an intuitive new proprietary trading platform,
launched in Q3 2022
+ ‘TradeSniper’ provides a highly differentiated, technology-
based proposition for Plus500 in the US futures retail
market
Further delivery against global strategic growth
opportunities:
+ Further roll-out of ‘Plus500 Invest’, the Group’s proprietary
share dealing platform
+ Access to substantial Japanese retail trading market,
through acquisition of a regulated entity in Japan
+ New regulatory licence obtained in Estonia, to act as
additional foundation to Plus500’s OTC
1
business in Europe
+ New regulatory licence from the Dubai Financial Services
Authority (“DFSA”) in the high growth market of the UAE
obtained in Q1 2023
Plus500’s reinforced financial position enables
continued investment in growth:
+ High level of cash balances maintained, with no debts or
loans since the Company’s inception
+ Continued strong Operating cash conversion
2
of 112%
(FY 2021: 99%)
Continued focus on key ESG priorities:
+ Further expansion of the range of the Board of Directors’
(the “Board”) experience and continued diversification of
its gender composition
+ Continued focus on customer care and protection, with
launch of the Group’s Trading Academy
+ Launch of ‘+Insights’, Plus500’s new big-data, analytical
tool designed to provide OTC customers with access to
key trends
Further substantial returns delivered to shareholders,
reaching $270.2m, representing 73% of FY 2022 net
profits:
+ Share buyback programmes in respect of FY 2022 of
$180.2m
+ Dividend payments in respect of FY 2022 of $90.0m
+ A total of approximately $1.7 billion returned to
shareholders since Plus500’s IPO in 2013, through dividends
and share buybacks
WELCOME
Plus500 delivered excellent results in 2022, driven by our unique proprietary
technology, which underpins our on-going ability to attract and retain higher
value customers over the long term. We are in an extremely exciting position,
with multiple potential growth opportunities available, particularly in the US
futures market, which will continue to drive our development as a global
multi-asset fintech group.
With further organic investments and targeted acquisitions, we are confident
that Plus500 is well-positioned to deliver sustainable growth over the
medium to long-term.
David Zruia
Chief Executive Officer
2022 Key Achievements
Plus500 Ltd. (“Plus500”, the “Company” or, together with its subsidiaries, the “Group”) is a global multi-asset fintech group operating proprietary
technology-based trading platforms.
2022 Financial
Highlights
2022 Operational
Highlights
Strategic Report
Group at a Glance 2
Chair’s Statement 4
Q&A with the Chief Executive Officer 7
Our Strategic Roadmap 10
Our Strategy in Action 12
Our Market-Leading Technology 14
Strong Customer Base 16
Our Marketing Strategy 18
Operational Excellence 20
Our Business Model 22
Key Performance Indicators 24
Key Stakeholder Relationships 26
Our ESG Approach 28
Report on the Task Force on
Climate-Related Financial Disclosures (TCFD) 33
Financial and Business Review – Statement
of the Chief Financial Officer 38
Group Tax Policy 40
Risk Management Framework 41
Going Concern and Viability Statement 46
Governance
Governance at a Glance 48
Chair’s Introduction to Governance 50
UK Corporate Governance Code Compliance Statement 51
Board of Directors 52
Governance Report 56
Shareholder Engagement 61
Report of the Nomination Committee 62
Report of the Audit Committee 66
Report of the Regulatory & Risk Committee 73
Report of the ESG Committee 76
Report of the Remuneration Committee 79
Directors’ Remuneration Report 85
Directors’ Report 95
Corporate Law 97
Directors’ Responsibility Statement 99
Financial Statements
Independent Report of the Auditors 101
Consolidated Statement of Comprehensive Income 106
Consolidated Statement of Financial Position 107
Consolidated Statement of Changes in Equity 108
Consolidated Statement of Cash Flows 109
Notes to the Consolidated Financial Statements 110
Further information
Advisors Inside back cover
Contents
1. ‘Over-the-Counter’ products, namely CFDs (‘Contracts for Difference’).
2. Cash generated from operations / EBITDA.
3. Customers depositing for the first time.
All charts and graphs contained in this Annual Report are graphical
representations of the underlying data to which each chart or graph
relates and have been included to aid interpretation of such data and
are therefore included for illustrative purposes only.
4. Customers who made at least one real money trade during the period.
5. Average Reveue Per User.
6. Average User Acquisition Cost.
Revenue
$832.6m
New Customers
3
106,549
EBITDA
$453.8m
Active Customers
4
280,769
EBITDA Margin
55%
ARPU
5
$2,966
Cash balance at year end
$930.2m
AUAC
6
$1,481
1 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
Plus500 is a global multi-asset fintech group operating proprietary
technology-based trading platforms, and is a constituent of the FTSE
250 index, with a premium listing on the Main Market of the London Stock
Exchange (symbol: PLUS). Plus500 offers customers a range of trading
products, including OTC, share dealing, as well as futures and options on
futures.
500+
Employees globally
50+
Countries where customers
can access Plus500’s products
24+ million
Registered customers on
Plus500’s platforms since
inception
Group at a Glance
Our valuesOur strategyOur purpose
Enabling trusted and intuitive
access to financial opportunities
Across financial instruments
Through a broad range of
innovative products
Across countries
Through global scale with localised
services
Across devices, platforms and
systems
Through best-in-class technology
Well positioned to access a range
of significant growth
opportunities
Plus500’s strategy is to further
develop its position as a global
multi-asset fintech group by
launching new products, entering
new markets, expanding its offering
in existing markets and deepening
engagement with customers
Technology driven
Our state-of-the-art proprietary
technology enables our product
leadership and agility
Strive for excellence
We do not compromise on the
quality of our products or on the
talent of our people
Customer-centric approach
Our customers are at the centre of
every decision we make, to ensure
we deliver best-in-class service
Committed to operating
sustainably and responsibly
We are focused on carrying out a
range of sustainability initiatives to
deliver tangible value for our
stakeholders
Read more on pages 28 – 32Read more on pages 10 – 13Read more on pages 4 – 9
A GLOBAL MULTI-ASSET
FINTECH GROUP
2 Plus500 Ltd. Annual Report 2022
US
Seychelles
Singapore
Australia
Japan
Estonia
UK
Bulgaria
UAE
Israel
Cyprus
Global operations
Plus500 global operations are managed by highly
skilled and experienced local management teams.
Plus500 licences
The Group’s portfolio of 12 regulatory
licences is an increasingly valuable asset.
To find out more about our Group visit:
www.plus500.com
Our competitive advantages and differentiators
Our Global position
Our technology Our track record Our leadership,
people and culture
Our agile
business model
Strong financial
performance since IPO
in 2013
+ c.25% compound
annual revenue growth
rate
+ Flexible cost base with
average annual EBITDA
margin of c.57%
+ Reinforced financial
position, with a strong
balance sheet, high
levels of cash
generation and debt-
free since inception
+ Approximately $1.7
billion returned to
shareholders in
dividends and share
buybacks
Technological expertise
embedded across the
business
+ Highly skilled
leadership team with
long-standing
technological
experience
+ Strong track record in
attracting and
retaining the best
technology talent in
Israel, the “start-up
nation”
+ Entrepreneurial, high
performance culture,
with customers at the
centre
Ensuring a customer-
centric approach
+ Unique edge in
attracting and
retaining customers
through multiple
marketing channels
+ Proven business model
serving customers
globally for over a
decade
+ Strong global brand
and reputation
+ Best-in-class customer
experience
+ Highly focused on
customer care and
protection
Powers our products,
operations, marketing
and our approach to risk
management
+ Proprietary, wholly
owned, managed and
operated by Plus500
+ Drives our customer-
centric approach
+ Continued significant
investment in R&D to
drive on-going
innovation
+ Supports our continued
alignment with relevant
global regulatory
standards and best
practice
3 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
FY 2022 was another excellent year for Plus500 and I remain
proud and privileged to be leading the Board as its Chair. This
is an extremely exciting time for Plus500 – the fundamentals of
our business are strong, we have a reinforced financial
position and there are a number of substantial strategic
growth opportunities available to us.
I am particularly excited about the significant growth
opportunities in the US futures market.
Furthermore, I am confident that my long-standing experience
and expertise in the US financial and capital markets will help
to support our management team in executing against our
strategic objectives in the US.
To this end, we achieved further success in FY 2022 in delivering
against our strategic roadmap. This was primarily driven by
our impressive and dynamic management team, capably
supported by our highly talented people around the world.
Our outstanding performance during the year was of course
supported by our powerful and customer-centric proprietary
technology, which remains one of our key differentiators. In
addition, there was further diversification and enhancement
of our Board during the year and we continue to act as a solid
foundation and support our management team as they
continue to deliver against our commercial, financial and
operational goals.
WELL PLACED
FOR FUTURE GROWTH
Chair’s Statement
Revenue
$832.6m
$832.6m
$718.7m
2022
2021
Total shareholder returns in respect of FY 2022,
including dividends and share buybacks
$270.2m
$270.2m
$200.2m
2022
2021
We achieved further success in
FY 2022 delivering against our
strategic roadmap. This was
primarily driven by our
impressive and dynamic
management team, capably
supported by our highly talented
people around the world
Prof. Jacob A. Frenkel
Chair
4 Plus500 Ltd. Annual Report 2022
Our purpose is being delivered by a clear investment case
I remain very excited and optimistic about the future for Plus500,
given our progress over the years, during which time we have
consistently delivered against all key metrics. This gives me
confidence that we can continue to achieve our ambition of
ensuring that Plus500 remains well placed to access a range of
substantial growth opportunities going forward.
Excellent operational performance in FY 2022, driving
growth and building on our strong track record
The Group delivered an excellent operational and financial
performance in FY 2022, driving further growth. As well as
producing operational and financial growth, we continued to
deliver attractive returns to shareholders during the year.
Against a challenging macro-economic environment,
Plus500’s balance sheet remains extremely robust, with the
Group continuing to hold no debt or loans since inception and
with cash balances as at 31 December 2022 increasing to
$930.2m.
The Group’s reinforced financial position will continue to fund
Plus500’s investment in future growth, through organic
investments and targeted acquisitions and will enable further
attractive returns to be delivered to shareholders, through
share buybacks and dividend distributions, as reflected in the
highly scaled returns of over 70% of FY 2022 net profits to
shareholders.
We also made significant strategic progress during the year, in
particular by developing a substantial and growing position in
the futures market in the US, supported by our best-in-class
technology and robust financial position.
We have two major strategic growth opportunities in that
market, on which we made excellent progress during FY 2022.
Firstly, we enhanced our position as a market infrastructure
provider, delivering brokerage-execution and clearing
services for institutional clients. Secondly, we launched a new
B2C proprietary trading platform tailored for the sizeable US
retail trading market.
Elsewhere, we gained initial access to the substantial
Japanese trading market, through an acquisition during FY
2022 and we continue to target several new potential markets
to expand our existing OTC product offering.
To this end, in February 2023, we obtained a regulatory licence
in the significant and high growth market of the United Arab
Emirates. Our strategic and operational success during the
year ensured we continued to develop our already strong
financial track record.
The growth outlook for Plus500
Based on our significant strategic, operational and financial
progress over recent years, and our reinforced financial
position, the Board remains confident about the Group’s future
prospects, with Plus500 remaining well positioned to access a
range of significant opportunities to grow and diversify its
revenue streams, geographic footprint and business model.
These growth opportunities will be accessed by our on-going
investment in developing our position as a global multi-asset
fintech group, in particular through further organic
investments in technology, innovation and people and by
actively targeting additional acquisitions.
Further developments in corporate stewardship and
investor engagement during the year
The range of the Board’s experience, knowledge and expertise
continues to broaden, with further diversification of its gender
composition achieved during the year. The representation of
women on the Board remains well ahead of the 40% target set
by the “FTSE Women Leaders review” framework and surpasses
the new FCA diversity target that at least 40% of the Board are
women, as currently female representation on Plus500’s Board
is 50%. There were several changes to the composition of the
Board and its Committees during the year. In March 2022, Prof.
Varda Liberman, a renowned international expert in the field of
decision-making and behavioural economics, was appointed
as an Independent Non-Executive Director. In June 2022,
Daniel King, our long-serving director, completed his
maximum nine-year tenure as an Independent Non-Executive
Director and External Director. Subsequently, Anne Grim
became a member of the Nomination Committee and Chair
of the Remuneration Committee, and Steve Baldwin became
Chair of the ESG Committee. Additionally, David Zruia became
a member of the ESG Committee.
To further diversify the composition of Board Committees,
additional rotations came into effect in Q1 2023, with Prof.
Varda Liberman, a member of the Regulatory & Risk
Committee, becoming its Chair, and also replacing Sigalia
Heifetz as a member of the Remuneration Committee.
Our investment case
1
Consistent track
record of growth
and delivery,
supported by our
long-term, high
value customer
base
2
Proprietary
technology is
Plus500’s key
differentiator
and enabler
3
Diversified
product portfolio
and geographic
footprint
4
Growth
supported by
organic
investments
and targeted
acquisitions
5
Reinforced
financial position
6
Major growth
opportunities
available to drive
shareholder
value
5 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
We continued to place great emphasis on shareholder
engagement in FY 2022. Our management team and I hosted
Plus500’s first ever Capital Markets Day in September 2022,
where we provided information on key elements of Plus500’s
investment case, business model and major growth
opportunities, and addressed questions from our
shareholders. A recording of the event is available on the
Group’s new Investor Relations website, launched last year
(investors.plus500.com).
Continued focus on key ESG priorities
We remain focused on a number of important ESG priorities,
including customer care and protection, which are outlined in
more detail on pages 28 to 32 of this Annual Report.
As a technology-based business, our carbon footprint is
relatively minimal and we remain committed to ensuring that
this continues to be the case. We are also committed to
providing detailed disclosure on our environmental impact
and, on pages 33 to 37, we include for the first time a
comprehensive report on our alignment to the Task Force on
Climate-Related Financial Disclosures (“TCFD”).
On employee welfare, well-being and development, Plus500
operates an entrepreneurial and high-performance
organisational culture globally to empower on-going
improvements in employee development, attraction and
retention, through training, learning, community engagement,
welfare, wellbeing and career progression. We also remain
very active supporting a number of stakeholders in the local
communities in which we operate and we continue to make
both financial and in-kind donations to these communities
and to a variety of charitable organisations supporting these
communities.
The Board continues to monitor and review the Group’s culture,
values and performance primarily through regular
discussions with our Executive Directors, senior management
and their teams. This engagement is driven by Steve Baldwin,
one of our Independent Non-Executive Directors, in his role as
a workforce engagement representative on the Board.
This helps to provide a channel through which our employees
worldwide can share their views and thoughts directly to the
Board, to help inform the Board’s approach to supporting on-
going improvements in our organisational culture and values.
To that end, I would like to take this opportunity, on behalf of the
Board, to pass on our appreciation to our talented and
enthusiastic people for their continued hard work and
dedication in helping to drive Plus500’s continued outstanding
performance.
Regulatory compliance remains a major area of Board and
management focus
The Group maintains a highly robust, customer-centric
approach to compliance, supported by our expertise in the
relevant global regulatory standards and our teams’ long-
standing relationships with the regulators in the markets and
industries in which we operate. We also have the technological
skills and capabilities to ensure that we can efficiently react
with speed to any regulatory changes that occur. This
approach has continued to deliver consistent results and has
helped to support our performance since Plus500’s inception.
With an established global regulatory network, managed by
our regulated subsidiaries and coordinated centrally, the
Group remains well positioned to cater for the regulatory
framework across the markets in which we operate. As at the
date of this Annual Report, the Group holds 12 regulatory
licences (three of which were obtained during FY 2022 and Q1
2023) and, this portfolio of licences is an increasingly valuable
asset for the Group, given its scarcity and the growing
complexity of obtaining new licences.
Continued delivery of attractive returns to shareholders
The Board has a clear capital allocation framework, based on
an on-going assessment of the availability of excess capital
going forward, to ensure there continues to be an optimal
balance between shareholder returns, investments in future
growth and in driving business continuity over the long term. In
particular, and aligned to this framework, the Board will
continue to ensure that appropriate levels of available capital
are maintained for required working capital and other factors
to drive future growth. To this end, the Company returned
$270.2m to shareholders in relation to FY 2022, including
$180.2m in share buybacks and $90.0m in dividends.
The announced share buyback programmes in respect of FY
2022 include a final buyback programme to purchase up to
$42.4m of the Company’s shares and a special buyback
programme to purchase up to $27.6m of the Company’s
shares, which are currently underway. We also conducted a
share buyback programme of $60.2m, announced on 17
August 2022, and a special buyback programme of $50.0m,
announced on 13 April 2022, both of which completed. Total
dividends in respect of FY 2022 amount to $90.0m, comprising
of a final dividend of $20.0m, a special dividend of $10.0m, and
an interim dividend of $60.0m (paid in November 2022).
Since the Company’s IPO in 2013, Plus500 has delivered
attractive returns to shareholders of approximately $1.7 billion
through dividends and share buybacks (including the returns
in respect of FY 2022), having generated significant levels of
cash from operations of approximately $2.9 billion in that
timeframe.
I look forward to reporting on the Group’s further progress in
next year’s Annual Report.
Prof. Jacob A. Frenkel
Chair of the Board
22 March 2023
Chair’s Statement continued
6 Plus500 Ltd. Annual Report 2022
The outlook for our business is
extremely exciting and our
prospects are highly compelling,
particularly as we continue to
further develop and differentiate
our strategic position as a global
multi-asset fintech group
David Zruia
Chief Executive Officer
Q&A with the Chief Executive Officer
DELIVERING FOR CUSTOMERS
THROUGH OUR TECHNOLOGY
A. Our purpose, which we remained focused on during FY
2022, is to enable trusted and intuitive access to financial
opportunities for our customers, across a wide range of
financial products, geographies and devices. This is being
driven by our continued development as a global multi-
asset fintech group, supported by organic investments
and targeted acquisitions.
The rationale for this purpose and strategy is that, by
expanding our product range from our historic single-
product focus, we can meet more of our customers’ needs,
diversify our revenue base, broaden our geographic
footprint and drive higher customer retention.
This will be achieved by successfully delivering against
our strategic roadmap of:
+ Launching new products;
+ Entering new markets;
+ Expanding our offering in existing markets; and
+ Deepening engagement with our customers.
Can you outline Plus500’s
purpose and strategy?
Q
7 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
Where else did Plus500 make strategic
progress in FY 2022?
Q
A. We made excellent progress in launching new products
and entering new markets during the year.
For example, in FY 2022 we gained initial access to a brand
new and exciting market for Plus500 – Japan. This was
achieved through the completion of an acquisition of a
regulated entity during the year, for which integration plans
are progressing well.
Over time, this will enable us to access the substantial
Japanese trading market, where we will apply our
considerable technological capabilities and financial
strength to build our market position locally.
In addition, ‘Plus500 Invest’, our new proprietary share
dealing platform, was launched in Europe on Android and
iOS mobile apps during the year. This product further drives
the expansion of our product range and geographic
footprint, as well as improving customer retention and
further diversifies our revenue base.
Can you talk about Plus500’s success in
further deepening customer engagement
during the year?
Q
A. In line with our plan to incrementally invest approximately
$50m in our R&D capability between FY 2021 and FY 2023, we
continue to invest in product development to further
deepen customer engagement, including through on-
going recruitment at our R&D centres in Israel.
We now have a latent base of over 24 million registered
customers on our trading platforms worldwide since
inception, which can be accessed through a number of
new retention technologies, products, tools and innovations.
These new innovations include ‘+Insights’, which was
launched during the year on our OTC trading platform as a
complementary service for customers across our web app,
iOS and Android applications. ‘+Insights’ is a new proprietary
big-data, analytical tool designed to provide customers
with access to real-time and historical trends, based on our
registered customer base. ‘+Insights’ enables customers to
view previously undisclosed key data points and
information which is uniquely segmented by the selected
core measurement and customisable filters, providing a
tailored experience for customers.
What are Plus500’s major growth
opportunities in the US?
Q
A. We are extremely excited about our growth prospects in
the substantial US futures market, having established a
strong and growing position in that market, supported by
our best-in-class technology and our robust financial
position.
In the US, we are targeting several significant growth
opportunities and, to this end, we made excellent progress
in 2022. This progress was supported by our new partnership
with the NBA Chicago Bulls, announced during the year,
which will drive brand awareness for Plus500, both in the
attractive US market and globally.
We also developed a new B2B line of business and a
strategic position as a market infrastructure provider, with a
view to delivering brokerage-execution and clearing
services for institutional clients. Our future progress in the
institutional market will be driven by our operational
capabilities, proprietary technology and our robust
financial position. Our proposition in this new line of
business is further strengthened by our position as a full
clearing member of the CME Group exchanges and the
Minneapolis Grain Exchange (MGEX), which were achieved
during the year.
In Q3 2022, we launched a new B2C proprietary trading
platform – ‘TradeSniper’, an intuitive futures trading
platform specifically tailored for the sizeable US retail
trading market. Like our OTC product offering, ‘TradeSniper’
has been developed with a customer-centric approach,
including a number of embedded features designed to
help support and protect customers while offering them a
fully holistic solution of onboarding, depositing and trading,
with new payment methods. All of these features are now
available for the first time for customers in the US futures
market.
Q&A with the Chief Executive Officer continued
8 Plus500 Ltd. Annual Report 2022
Can you discuss Plus500’s operational and
financial performance during FY 2022?
Q
A. Our strong operational and financial performance last
year was fundamentally driven by our proven business
model, our market-leading proprietary technology and our
on-going ability to attract and retain higher value, long-
term customers.
Long-term customer loyalty increased to an extraordinary
position, with 87% of FY 2022 OTC revenue derived from
customers trading with Plus500 for more than a year, 40%
for more than three years and 24% for more than five years.
Highlighting the long-term value creation being delivered
by our business model, the cumulative average revenue
from OTC Active Customers who first started trading with
Plus500 during 2016 was approximately $5,000 as at the end
of FY 2022, reflecting the long-term, sustainable value of our
customer base.
ARPU reached a record annual level of $2,966 in FY 2022.
Customer deposits remained high with average deposit
per Active Customer also achieving a record annual level of
approximately $8,000, highlighting the continued strong
level of confidence that customers have in Plus500 and the
resilience of our trading platforms. Total customer deposits
in FY 2022 amounted to $2.3 billion.
We onboarded a total of 106,549 New Customers during the
year and the number of Active Customers remained robust
at 280,769. This was supported by continued investment in
our diversified marketing approach, which included our
sophisticated proprietary marketing technology and a
range of strategic initiatives and advertising campaigns to
drive customer retention, monetisation and activation.
These initiatives included, among others, the launch of a
major bespoke global advertising campaign, featuring
actor Kiefer Sutherland, to build brand awareness in key
strategic markets. This international advertising campaign,
the first in Plus500’s history, is embedded across our social
media networks and other online and offline marketing
channels. The next phase of the campaign has been
initiated in Q1 2023, specifically focusing on the launch and
development of ‘+Insights’.
Finally, in your view, what is the outlook
for Plus500?
Q
A. The outlook for our business is extremely exciting and our
prospects are highly compelling, particularly as we
continue to further develop and differentiate our strategic
position as a global multi-asset fintech group.
We are in an extremely exciting strategic and commercial
position, with multiple potential growth opportunities
available, particularly in the US futures market, which will
continue to drive our growth as a global multi-asset fintech
group. With further organic investments and targeted
acquisitions, we are confident that Plus500 remains well-
positioned to deliver sustainable growth over the medium
to long-term.
My confidence and optimism about the outlook for Plus500
is also driven by the dedication and talent of all our people
around the world. I am extremely grateful for their hard work
and commitment, which continues to ensure that Plus500
remains in an excellent position to deliver sustainable
future growth.
David Zruia
Chief Executive Officer
22 March 2023
We are in an extremely exciting
strategic and commercial position,
with multiple potential growth
opportunities available, particularly
in the US futures market.
9 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
Our purpose is to enable trusted and intuitive access to financial opportunities
for our customers, across a wide range of financial instruments, geographies
and devices. This strengthens our position as a global multi-asset fintech
group and is supported by four key differentiators.
OUR PURPOSE, STRATEGY
AND KEY DIFFERENTIATORS
Our Strategic Roadmap
Our powerful
proprietary technology
Our proprietary technology remains our fundamental
competitive advantage, enabling Plus500 to respond
with agility to customer requirements, fast-emerging
market developments and regulatory changes. It has
taken many years to develop this technology, enabling
Plus500 to build a long track record of innovation and a
market-leading technological capability.
Our long
track record
We have built a long track record of financial
performance, with approximately 25% CAGR in revenue
since the IPO year, and an average EBITDA margin of 57%
over that time. We have remained debt free since
inception and have continued to be highly cash
generative since that time.
1 2
Read more on pages 14-15 Read more on pages 38 – 40
Customers using Plus500’s OTC platform through
mobile or tablet devices, generated
85%+
of the Group’s OTC revenue in FY 2022
Shareholder returns of
$1.7 billion
since IPO in 2013
Plus500’s differentiators ensure that it is well positioned to continue
diversifying its revenue streams, product range and geographic
footprint.
10 Plus500 Ltd. Annual Report 2022
Our leadership,
people and culture
Our operating track record and technology
development are a testament to the quality of our
people. We have fostered a high-performance
organisational culture, reflecting Israel’s technology-
based and innovative environment. This has been led
by a highly skilled management team, with specialist
expertise and experience in technology.
Our agile
business model
Our agile, customer-centric business model, with its
unique edge in attracting and retaining customers
through multiple channels, strong brand, and
continued focus on customer care and protection, has
ensured that we have consistently driven an attractive
marketing Return on Investment (“ROI”) over time.
3 4
Read more on pages 28 – 32 Read more on pages 22 – 23
Our people
500+
at the end of FY 2022
Registered customers on our
platforms globally, since inception
24+ million
11 Plus500 Ltd. Annual Report 2022
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Significant
progress made
in the US futures
market
Our Strategy in Action
In the substantial futures market in the US, Plus500 has
established a strong and growing position, which remains
supported by Plus500’s best-in-class technology and its
reinforced financial position.
Plus500 made excellent progress in FY 2022 in targeting a
number of substantial growth opportunities in the US futures
market. This progress was supported by increased brand
awareness of Plus500 in the US through the Group’s new
partnership with the NBA Chicago Bulls.
During FY 2022, the Group established a new B2B line of
business and a strategic position as a market infrastructure
provider. This new business line will drive Plus500 in delivering
brokerage-execution and clearing services for institutional
clients. Plus500’s operational capabilities, proprietary
technology and the Group’s robust financial position will
help to drive the Group’s future progress with institutional
clients in the US futures market. In addition, Plus500’s
proposition as a market infrastructure provider is
strengthened by its position as a full clearing member of the
CME Group exchanges and the Minneapolis Grain Exchange
(MGEX), both of which were achieved during FY 2022.
Also during FY 2022, Plus500 launched ‘TradeSniper’, an
intuitive proprietary B2C futures trading platform tailored for
the sizeable and latent US retail trading market. This platform
has been developed with a customer-centric approach,
with a number of embedded features designed to help
support and protect customers.
‘TradeSniper’ offers a highly differentiated, technology-
based proposition for Plus500 in the US futures retail trading
market, with high levels of automation and technological
integration. This allows ‘TradeSniper’ to provide customers
with a fully holistic solution, including many features that are
available for the first time for US futures market retail
customers.
Plus500 will continue to allocate the appropriate financial,
operational and human resources to maximise these
significant opportunities in the US over the medium term.
Plus500 continues to make strong progress against its strategic
roadmap, particularly in developing a compelling proposition in the
US futures market.
12 Plus500 Ltd. Annual Report 2022
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13 Plus500 Ltd. Annual Report 2022
Supporting the customer journey
across our technology stack
Our technology powers our operations and trading
platforms, and is supported by an industry-leading, full
stack R&D team. We have continuously driven technological
innovation to provide our customers with a best-in-class
experience. Consequently, our technology stack supports
our customers through every step of their journey with
Plus500.
Marketing
Our technology efficiently ensures our online marketing
campaigns achieve an attractive return-on-investment.
The marketing technology includes artificial intelligence
characteristics and its optimisation process is made as a
result of its big data capabilities.
Operations
Once a customer has decided independently to open an
account on our platforms, the operational element of our
technology is initiated. At that point, customers go through a
stringent, rigorous verification and on-boarding process, in
accordance with the applicable regulation, supported by
24/7 localised customer care and a best-in-class payment
processing service, utilising a range of possible payment
methods for our customers. This is all achieved “behind the
scenes”, ensuring the customer experience remains efficient
and seamless.
Product
The on-going product experience is a critical element of the
customer journey. This element of the customer experience
includes a range of educational and training tools, which is
continuously updated and upgraded, through new features,
new analysis tools, new products and new financial
instruments. All of these dynamics ensure that we can drive
customer retention and value over time.
Systems infrastructure
The customer journey is supported and secured by a robust
systems infrastructure, with a powerful proprietary CRM
platform, cyber security and anti-fraud protection features
and a robust risk management framework. These elements
are a crucial part of our wholly owned and managed
technology. Our scalable and reliable systems architecture
also facilitates the customer journey.
Innovating our product through our
proprietary technology in FY 2022
We offer our customers a range of trading products,
including our market-leading and long-standing OTC
product offering across many countries around the world,
our new and exciting products in share dealing in various
European markets and futures and options on futures in the
US.
Through our OTC product portfolio, we offer over 2,500
different underlying global financial instruments for
customers using our products across more than 50
countries and in 30 languages.
During FY 2022, our proprietary share dealing platform,
‘Plus500 Invest’, was launched in Europe on Android and iOS
mobile apps. This product helps to drive the expansion of our
product range and geographic footprint, as well as
improving customer retention and further diversifying our
revenue base.
In line with our plan to incrementally invest approximately
$50 million in our R&D capability between FY 2021 and FY
2023, we continue to invest in product development and
innovations to further deepen customer engagement,
including through continued recruitment at our R&D centres
in Israel.
These new innovations include ‘+Insights’, launched during
the year on our OTC trading platform.
PLUS500’S MARKET-LEADING
PROPRIETARY TECHNOLOGY CAPABILITY
Our Market-Leading Technology
82%+
of customer trades on Plus500’s OTC platform took
place on mobile or tablet devices in FY 2022
2,500+
different underlying OTC financial instruments
14 Plus500 Ltd. Annual Report 2022
Supporting proprietary technologies
A focused trading experience for customers
CRM
Marketing Machine
Retention Machine
Localisation
Cashier-Payments
Trading & Risk Management
Education
Analytical Tools
INNOVATING OUR PRODUCT THROUGH
OUR PROPRIETARY TECHNOLOGY
Our core product offering, available
across over 2,500 underlying
financial instruments internationally
Our big-data, analytical tool
designed to provide OTC customers
with access to real-time and
historical trends, based on our
registered customer base
Plus500’s intuitive proprietary futures
trading platform specifically tailored
for the sizeable US retail trading
market
Plus500’s proprietary share dealing
platform, available in mobile
applications across European
markets
Our educational portal for customers,
which includes training videos, an
eBook, relevant news alerts and
detailed FAQ on key trading dynamics
15 Plus500 Ltd. Annual Report 2022
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The recent launch of Plus500’s ‘+Insights’ further enhances
our best-in-class experience for customers
As a consequence of the Group’s substantial market position
and high levels of trading volumes on its platforms, Plus500
is able to utilise its unique proprietary data to generate
dedicated tools and content to empower its customers
around the world.
To this end, in November 2022, Plus500 launched ‘+Insights’,
a new big-data, analytical tool designed to provide
customers with access to real-time and historical trends,
based on the Group’s registered customer base. Plus500’s
‘+Insights’ is available on the Group’s OTC trading platform
as a complementary service for customers across its web
app, iOS and Android offerings.
The launch of ‘+Insights’ is the latest innovation in Plus500’s
long track record of product development and technological
advancement.
The Group’s continued investment in its ESG framework is
evidenced by the offering of ‘+Insights’, given it was
developed on the basis of customer feedback. This new tool
demonstrates Plus500’s on-going focus on customer care
and delivering on customer requirements, to ensure that a
best-in-class experience is maintained for customers.
By using aggregated and anonymous big-data, which is
fundamentally based on key real-time and historic trends
across the trading community, customers are now able to
view never-before-seen key data points and information, to
enhance their trading activities subject to their own
independent discretion.
This information is uniquely segmented by the selected core
measurement and customisable filters to provide a unique,
tailored experience for customers.
24+ million
registered
customers
Strong Customer Base
16 Plus500 Ltd. Annual Report 2022
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17 Plus500 Ltd. Annual Report 2022
A clear and focused marketing approach
Plus500’s marketing approach is multi-dimensional and
diverse, fundamentally driven by our technology. With the
support of key strategic partners, we manage multiple
marketing initiatives in paid search and organic search, as
well as running numerous content marketing and PR
campaigns. Plus500 is a leader within the marketing
technology space and our superior technology is continuously
optimised to deliver consistent improvement in our results.
Our marketing technology – a key differentiator
Our unique and wholly-owned marketing technology remains
a fundamental driver to our performance. We continue to
invest in this technology, through targeted and efficient
marketing technology initiatives, including big data and AI.
This helps us to drive customer acquisition, activation,
retention and long-term monetisation. In this way, we are able
to drive customer retention and cohort value over the long
term.
Our marketing technology is efficient, scalable and agile, with
all data fully segmented from top to bottom, ensuring that we
are able to achieve our objective of driving volumes while at
the same time maintaining a high ROI.
Diverse and highly skilled marketing team
Plus500’s marketing technology success is delivered thanks to
our marketing team, which is comprised of data-driven and
highly skilled technologists and engineers.
We have dedicated teams with a specific focus on key areas
such as search engines, social media, creative design and
data analytics. Importantly, all these teams are constantly
collaborating and communicating with each other, ensuring
a consistent, joined-up approach for every marketing initiative
we develop.
Technology also focused on customer retention
Our marketing technology is also focused on customer
retention. Our retention approach is based on tailored
communications at scale and we use a range of measurement
techniques in developing our retention campaigns, including
A/B testing and control group methodology. This helps to fine-
tune segmentation strategies and campaign management
and planning.
We also share with customers targeted news flow in areas
where they have shown interest in the past and we look to
reduce churn by notifications around potential trading
insights and ideas. ‘+Insights’ is another, even more
sophisticated tool, in this regard, as well as our Premium
Service for customers.
Key market trends and Plus500’s strong market position
Our approach to marketing is aligned to a key trend in the
global trading industry of continued digitalisation, which is
driving further accessibility to online channels by customers.
To illustrate this, and to highlight Plus500’s continued market
leadership and focus on innovation in the mobile and tablet
space, over 85% of the Group’s OTC revenue in FY 2022 was
generated from customers which utilised Plus500’s OTC
platform on mobile or tablet devices (FY 2021: over 83%), with
over 82% of OTC customer trades taking place on mobile or
tablet devices in FY 2022 (FY 2021: over 79%).
During the year, Plus500 maintained its market-leading
positions in key strategic markets and was ranked as the
number one OTC provider in the UK
1
, Germany
2
and Spain
3
for
its OTC product offering.
1. By total number of primary customer relationships. Investment Trends
2022 UK Leverage Trading Report.
2. By total number of customer relationships. Investment Trends 2022
Germany Leveraged Trading Report.
0-6 months
3%
10%
47%
16%
24%
7-12 months
1-3 years
3-5 years
5+ years
3. By total number of customer relationships. Investment Trends 2022 Spain
Leveraged Trading Report.
A MULTI-DIMENSIONAL
MARKETING APPROACH
Our Marketing Strategy
OTC Revenue split by customer tenure in FY 2022
Customers trading with
Plus500 for more than 1 year
87%
18 Plus500 Ltd. Annual Report 2022
During FY 2022 we established a multi-year global partnership with the NBA
Chicago Bulls to drive awareness in the US and globally.
In October 2022, Plus500 announced a major multi-year
agreement to become an official global partner of the
Chicago Bulls, the iconic NBA team and one of the most well
known sports franchises in the world.
The Plus500 logo is the first ever to feature exclusively on the
front of the team’s warmup shooting shirts and jackets.
Plus500 has access to branding rights as the “Official Global
Online Trading Partner” of the Chicago Bulls, marking the
official formation of a truly unique partnership that sees an
inter-connectivity of sports and digital trading platforms.
By leading with its customer-centric approach, Plus500 is
already delivering intuitive and accessible trading products.
The partnership includes various marketing elements,
community initiatives, social media content, events and
more, to drive brand awareness and build on the core
synergies that both brands have in common: innovation,
culture and success.
Our global partnership with the NBA Chicago Bulls
It also emphasises Plus500’s ambitions to develop its global
footprint by entering new markets, and specifically the
Group’s connection with the city of Chicago — the heart of
the US futures industry and where Plus500’s US operations
are located.
The sponsorship of the Chicago Bulls coincides with
Plus500’s continued expansion and appetite to launch new
products for different types of customers, resulting in a
dedicated effort to establish a strong and growing position
in the US futures market, which it sees as a significant
opportunity for long-term growth.
19 Plus500 Ltd. Annual Report 2022
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Driving
operational
excellence
Operational Excellence
Delivered by our technology
Our operational systems and processes, powered by our
proprietary technology and managed by our talented
people, have always been fully developed in-house. This
differentiates Plus500 from its competitors, many of which
aggregate a range of processes and systems from different
suppliers, which are not always directly connected. Our
integration-based, inter-connected approach provides our
customers with a seamless experience across all elements
of their journey.
Our mission within our operational team is to create the
environment for the execution of the Group’s strategy by
providing the operational capacity for resources, internal
efficiency and a customer-centric approach. This is based
on an agile operational model, which enables us to scale up
at speed, a large pool of highly skilled, experienced and
committed operational employees and a high performance
culture which is focused on tangible deliverables and
outputs.
These factors ensure that, as an operational team, we are
consistently delivering best-in-class customer experience
and efficient internal processes, particularly to support our
operating teams around the world in achieving a consistent
global product and service for customers.
Delivered by our people
Our organisational structure ensures our operational team
is completely focused on constantly driving efficiency.
Across the team, we share and develop knowledge,
collaborating between sub-teams, and thereby always
improving the way we work.
This helps us to optimise our processes and functions and
allows us to scale up quickly to support our trading platforms
when they need to cater for higher volumes at short notice.
Ultimately, our culture helps to attract, retain and drive the
quality of our employees, which ensures that customers are
always receiving a best-in-class experience.
Our proprietary technology-based operational capabilities
form the foundation from which the Group can execute on its
global strategic roadmap.
20 Plus500 Ltd. Annual Report 2022
Creating operational consistency through systems
and processes
Our consistent operational platform is used as a foundation
from which our global business can manage its day-to-day
activities and deliver growth. We have developed an internal
knowledge hub, to support our global subsidiaries, with all the
relevant information they require housed in one place. This is
constantly updated with the latest regulatory and compliance
framework requirements and is used as a guidebook for daily
usage across the Group’s internal teams.
Looking ahead, we are creating a foundation for the new
subsidiaries that have been set up over the last year or so,
including the US, Japan, Estonia and the UAE.
Best-in-class customer support
Our customer support team maintains a consistent focus
on cutting-edge localised customer care on a 24/7 basis.
This is delivered through email, live chat and WhatsApp in
multiple languages. There are dedicated teams for trading,
payments and Premium Service. The teams are all directly
connected to each other to ensure all customer queries are
dealt with quickly and efficiently. We also have an
educational team which trains our internal teams on
matters of customer service.
Governance Financial statementsStrategic report
21 Plus500 Ltd. Annual Report 2022
CREATING VALUE THROUGH
OUR BUSINESS MODEL
Our Business Model
Responding to customer
requirements…
Customer-centric approach
Embedded in the Group’s culture, ensuring a
best-in-class customer experience, enabled by
on-going technological development of Plus500’s
trading platforms.
Further automation across the industry
Greater accessibility to digital channels by
customers.
Aligned to relevant regulatory requirements
Enables continued customer care and protection,
through educational and training features.
Financial position and capacity
The Group has built a strong financial track
record, maintaining a debt-free balance sheet
since inception, with a lean and flexible cost
structure and consistently high levels of cash
generation.
Read more on pages 38 – 40
Corporate reputation
Plus500 is a FTSE 250 company with a Premium
Listing on the London Stock Exchange. The Group
has a long track record of strong operational and
financial performance, supported by its market-
leading and technology based trading platforms.
Read more on pages 1 – 9
Regulators
The Group ensures that it remains in compliance
with relevant global regulatory standards.
Read more on pages 26 – 27
People
The Group attracts and retains talented people to
drive on-going optimisation and management of
its technology platforms and its ability to attract
and retain customers.
Read more on pages 28 – 32
Technology
Plus500 operates its robust and agile trading
platforms which are based on its proprietary
technology.
Read more on pages 28 – 32
Service Providers
Plus500 has strong and strategic relationships
with a range of service providers to support its
commercial efforts and business initiatives.
Read more on pages 26 – 27
With a clear purpose
and strategy…
Our purpose is to enable trusted and intuitive
access to financial opportunities for our
customers, across an increasingly broad range of
financial instruments, countries and devices, to
drive our continued progress as a global multi-
asset fintech group.
Supported by…
Comprehensive risk management
Proprietary OTC risk management system that
incorporates real-time functionality risk
management systems and trading threshold
triggers to reduce risk.
Sound governance
Plus500’s Board is comprised of a diversified and
highly experienced group of individuals with
extensive knowledge across multiple disciplines,
in particular financial services and technology.
Our robust and scalable
business model creates
value for our stakeholders
Resources and
relationships
How we create and
maximise value
22 Plus500 Ltd. Annual Report 2022
People
Plus500 offers rewarding and interesting
professional opportunities for our people to
achieve long-term development and career
progression.
Customers
Customers enjoy highly rated, robust and
scalable, user-friendly trading platforms, which
are tailored for mobile usage. Intuitive navigation
and consistency minimises the learning curve
between devices and improves user experience.
Shareholders and
investors
Plus500 has delivered attractive returns through
ordinary and special dividends and share
buybacks. Total returns in dividends and
share buybacks since IPO in 2013 amount
to approximately $1.7 billion.
Regulators
The Group engages with regulators to ensure
the integrity of the industry remains robust,
contributing to round table discussions within
the industry and holding regular dialogue with
global and regional regulators.
Service providers
The cooperation and collaboration of the
Company with its service providers delivers
value and synergy.
Society
Helping the communities in which we operate
with monetary and in-kind donations
and support.
Key
Stakeholders
Value created
in FY 2022
Revenue
$832.6m
EBITDA
$453.8m
Shareholder returns
$270.2m
Basic earnings per share
$3.81
Operating cash conversion
112%
Customer deposits
$2.3bn
Governance Financial statementsStrategic report
23 Plus500 Ltd. Annual Report 2022
MEASURING OUR
PERFORMANCE
Key Performance Indicators (“KPIs”)
1. Revenue from OTC Customer Income (customer spreads and
overnight charges) and Non-OTC Customer Income (commissions
from the Group’s futures and options on futures operation and from
‘Plus500 Invest’, the Group’s share dealing platform)
2. Gains/losses on customers’ trading positions
Our KPIs are used to
benchmark the Group’s
performance and its ability to
drive ROI over time.
Revenue
$832.6m
What it is
The Group’s revenue is the income it generates through
Customer Income
1
and Customer Trading Performance
2
.
Why we measure it
Revenue is a measure of the Group’s ability to maximise
the strength of its technology, representing the total
income generated from customer usage of the Group’s
trading platforms in the relevant financial period.
EBITDA
$453.8m
What it is
EBITDA is defined as earnings before interest, tax,
depreciation and amortisation.
Why we measure it
EBITDA is a measure of the Group’s profitability and
can be used to directly compare the Group’s profitability
to that of other companies and other sectors.
Financial KPIs
$832.6m
$718.7m
2022
2021
$453.8m
$387.1m
2022
2021
Read more on pages 38 – 40
Read more on pages 38 – 40
24 Plus500 Ltd. Annual Report 2022
ARPU
$2,966
What it is
ARPU is calculated by dividing the revenue by the
number of Active Customers in the relevant period.
Why we measure it
This measure helps to provide an understanding
of the average revenue we are generating on a
customer-by-customer basis. This helps us to identify
and optimise our customer acquisition strategies to
deliver an attractive return-on-investment over time.
$2,966
$1,764
2022
2021
AUAC
$1,481
What it is
AUAC shows the average cost of attracting a new
customer and is calculated by dividing our total
marketing expenses by the number of New Customers
in the relevant period.
Why we measure it
AUAC is a reflection of the marketing cost of recruiting
New Customers in the relevant period.
$1,481
$877
2022
2021
Active Customers
280,769
What it is
Active Customers are customers who made at least one
trade using real money (rather than trading through a
demo account) on one of our trading platforms in the
relevant period.
Why we measure it
This measure reflects the level of customer activity on
the trading platforms during the relevant period. It is an
indicator of how successful the Group is in attracting
and retaining customers, with a view to delivering
sustainable revenue and profits.
280,769
407,374
2022
2021
New Customers
106,549
What it is
New Customers are customers who have deposited into
their trading account for the first time.
Why we measure it
This metric tracks the number of New Customers the
Group attracts. This helps us to understand the success
of our technological capabilities and effectiveness of
marketing initiatives.
106,549
196,336
2022
2021
Non-financial KPIs
Read more on pages 38 – 40 Read more on pages 38 – 40
Read more on pages 7 – 9 Read more on pages 7 – 9
25 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
ENGAGING WITH
OUR STAKEHOLDERS
Key Stakeholder Relationships
The Group aims to develop long-lasting and valuable relationships with
its key stakeholders through open and consistent engagement and
communication. The feedback and insights of the Group’s key stakeholders
are taken into consideration as part of the Board’s discussions and
decision-making processes.
Why we engage
We aim to ensure that Plus500 continues to provide a consistent, best-
in-class service to our customers and that we continue to listen to our
customers about their requirements and interests. This approach
helps Plus500 to retain existing customers and attract new customers.
In addition, we aim to ensure our customer care and protection is
maintained, through educational tools and risk management
features.
How we engage
We engage with customers through an omni-channel customer-
centric approach. We provide 24/7 customer support, which is
available in multiple languages across a number of channels.
We also provide customers with a range of educational and training
tools to support them with their trading activities, including the launch
of the Plus500 Trading Academy in FY 2022. In addition, a free demo
account is available for our OTC and ‘TradeSniper’ customers.
In addition, we conduct customer surveys to better understand their
views on Plus500’s service, so that we can continue to innovate and
develop our products, based on customer feedback. As an example,
in FY 2022, based on customer feedback, the Group launched
‘+Insights’, a big-data, analytical tool designed to provide its OTC
customers with access to real-time and historical trends, based on
the Group’s registered customer base.
A new Premium Service was also introduced, including 24/7 premium
customer support and access to a dedicated team of client
managers, to support customers. This service also includes access to
premium educational webinars, weekly analysis and tailored emails
and educational materials on trading.
Key focus areas
+ Consistent level of service delivery;
+ Continued 24/7 customer service availability;
+ Further expansion of range of educational and training tools;
+ Provision of negative balance protection and other embedded
risk management features, to ensure customer care and
protection is maintained; and
+ On-going customer surveys to ensure we remain cognisant of
customer requirements and ideas.
Why we engage
Organisational culture and employee welfare and well-being are
critical in ensuring that our services are delivered, through the on-
going development of our technology by our people, on a consistent,
long-term basis. With this in mind, the Group regards its talented and
committed people around the world as its key asset to enable its
technology and services.
How we engage
The Group undertakes regular evaluation processes for our people
and provides competitive reward packages to attract and retain high
quality people. We encourage our people to participate in training,
learning and development, and make them aware of possible career
progression opportunities within the Group.
We provide our people with a dynamic work environment, with high
quality office facilities, including a number of new offices opened
during the year, and the opportunity to engage in a number of social
activities and community engagement programmes.
One of our Non-Executive Directors, Steve Baldwin, is the workforce
engagement representative on the Board who provides a channel
through which our people can share their views directly to the Board,
informing the Board’s approach to supporting improvements in
organisational culture.
Key focus areas
+ Consistent internal communication on developments within
the Group and across our industry;
+ Continued opportunities for training, learning, development
and career progression; and
+ Continued communication of people matters to the Board.
Customers People
26 Plus500 Ltd. Annual Report 2022
Why we engage
Plus500 works with various service providers, including processors,
marketing partners and sports sponsorship partners, who support the
Group with various activities.
How we engage
We build strong partnerships with service providers through an open
dialogue to ensure we can develop long-term valuable relationships.
Our relationships with our service providers include the on-going
review and monitoring of their performance levels, to ensure that the
Group is achieving quality and value from its partnerships. Ultimately,
this helps to build mutually beneficial relationships with our service
providers.
Key focus areas
+ On-going dialogue with our service providers;
+ Continued fair treatment of service providers in our dealings
with them; and
+ Consistent focus on innovation and new initiatives to help
deliver enhanced value from service provider partnerships.
Why we engage
Engagement with local communities is important from social welfare
and sustainability perspectives and, with this in mind, the Group
continues to support its local communities.
How we engage
The Group participates in a number of projects to support and assist
local communities and charities. These include on-going monetary
contributions and the provision of resources and equipment to a
number of charities, non-profit organisations, community centres
and disadvantaged families in local communities.
The Group also maintains strategic partnerships and alliances with
community partners, including our on-going collaboration with top
tier academic institutions, for example the ‘Technion – Israel Institute
of Technology’, through which we participate in several innovation
and entrepreneurship initiatives.
Key focus areas
+ Continued financial donations;
+ On-going supply and provision of resources and equipment;
+ Further employee engagement in local community projects;
and
+ Continued focus on strategic partnerships with top tier
academic institutions.
Service ProvidersCommunities
Why we engage
Plus500 aims to provide fair, balanced and understandable
information to investors and shareholders, to ensure their continued
support of the Company. Maintaining a close connection to its
shareholders through clear and transparent dialogue continues to be
a major focus for Plus500. The Company continues to seek ways in
which to enhance its relationship with investors.
How we engage
An open dialogue with investors is achieved through meetings, results
presentations, Capital Markets Day events, conference attendance
and group meetings, such as the Annual General Meeting. In addition,
the Company produces a variety of investor-focused materials,
including annual reports, news published on the Regulatory News
Service and investor presentations. These are available on our
dedicated Investor Relations website (investors.plus500.com).
Key focus areas
+ On-going transparent dialogue with investors;
+ Open lines of communication for shareholders;
+ Regular collection of investor feedback and dissemination to
the Board; and
+ Executive management participation in investor-focused
events and activities.
Why we engage
Regulatory oversight is an integral part of the Group’s business, as its
regulated subsidiaries retain operating licences and are supervised
by various regulators around the world. Regulatory compliance
procedures are constantly reviewed and enhanced, with a culture of
compliance embedded within the business, including open and
constructive communications with relevant regulatory bodies.
How we engage
The Group communicates with regulators on an on-going,
constructive and open basis and participates in a number of
regulators’ co-ordination groups. In addition, we contribute to public
consultations issued by regulators on relevant industry matters.
Key focus areas
+ Continued monitoring of, and compliance with, appropriate
laws, relevant regulatory standards and industry best
practices;
+ Rapid implementation of regulatory changes, driven by our
proprietary technology; and
+ On-going communication with, and support of, regulators in
current markets where the Group is operating and in
jurisdictions where the Group may operate in the future.
InvestorsRegulators
27 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
ENVIRONMENTAL, SOCIAL
AND GOVERNANCE
Introduction
The Group remains committed to operating responsibly and
sustainably in all aspects of its business, carrying out a range
of ESG initiatives to deliver tangible value for its stakeholders.
The Group’s core ESG values are:
+ Creating long-term value for our stakeholders;
+ Putting our customers first by leading the industry in which
we operate and by delivering innovative and high quality
products;
+ Maintaining a dynamic and creative work environment for
our people around the world, which promotes diversity and
equal opportunity, protects human rights and eliminates
discrimination; and
+ Minimising any impact of the Group’s operations on the
environment.
Plus500’s key ESG priorities are:
+ customer care and protection;
+ organisational culture;
+ cyber security;
+ systems infrastructure; and
+ leadership and governance.
This section of the Annual Report outlines the Group’s progress
in each of these areas in FY 2022, as well as providing
comprehensive disclosure in relation to the Task Force on
Climate-related Financial Disclosures (TCFD) on pages 33
to 37.
Plus500 continues to take steps to mitigate the risks associated
with each of these priority areas, supported by on-going
engagement with key stakeholders. The Key Stakeholder
Relationships and Risk Management Framework sections on
pages 26 to 27 and 41 to 45 of this Annual Report outline how
the Group is mitigating these risks in more detail.
During FY 2022, the Group
remained focused on its
key priorities in the areas of
Environmental, Social and
Governance (“ESG”) in particular
customer care and protection
as well as employee well-being,
welfare and development.
Leadership and governance
Plus500 makes significant effort to remain in compliance with
all relevant governance requirements, in particular ensuring
the appropriate Board composition and diversity, and
maintaining a remuneration policy for Directors and
executives which is aligned to the long-term interests of
shareholders.
In addition, the Board remains aware that it must continue to
attract and retain high quality Board membership and
executive management leadership, to ensure the Group
continues to deliver a consistently strong operational
performance and achieve its strategic objectives.
More details on the Board’s approach to governance, covering
each of these priority areas, can be found in the Governance
section of this Annual Report, on pages 48 to 51, with
biographies of each Board member on pages 52 to 55.
Customer care and protection
Customer care and protection, in particular ensuring
customers remain protected from, and well informed of, the
inherent risks involved with trading, remains a high priority for
the Group, in line with global regulatory requirements in this
area. This is not only a specific priority for Plus500, but also for
the entire industry as a whole.
Measures such as negative balance protection and
maintenance margin protection on the Group’s OTC trading
platform remain crucial in ensuring customers are well
protected, having been embedded in Plus500’s technology
since its inception, and now integrated across many
regulatory regimes around the world.
In addition, a free demo account is available on an unlimited
basis for the Group’s OTC and ‘TradeSniper’ customers, while
sophisticated risk management tools are provided free of
charge for customers to manage leveraged exposure,
including measures such as stop losses.
The Group continued to develop its range of educational and
training tools and features on its platforms in FY 2022, including
the launch of a Trading Academy portal, which includes
training videos, an eBook, relevant news alerts and detailed
FAQ on key trading dynamics. In the Group’s US operation, there
also remains a focus on the training and educational materials
for customers, with Plus500 launching a range of educational
content for customers during the year. In addition, the Group
continues to ensure that risk warnings are prominent on its
trading platforms and marketing materials and provides
appropriate risk disclosures in line with applicable regulatory
requirements.
Our ESG Approach
28 Plus500 Ltd. Annual Report 2022
Furthermore, the Group’s continued investment in its ESG
framework and clear focus on customer education and
training is evidenced by the launch of ‘+Insights’, which was
developed by the Company based on feedback from
customers. This new tool demonstrates Plus500’s on-going
focus on customer care and delivering on customer
requirements, to provide a best-in-class experience for
Plus500 customers.
The Group maintains a highly robust, customer-centric
approach to compliance, supported by its expertise in the
applicable global regulatory standards and its long-standing
relationships with the regulators in the markets and industries
in which it operates. The Company also has the technological
skills and capabilities to ensure that it can efficiently react with
speed to any regulatory changes that occur.
Organisational culture
Plus500 operates an entrepreneurial and high-performance
organisational culture to empower on-going improvements in
employee development, attraction and retention, through
training, learning, community engagement, welfare, wellbeing
and career development. This ultimately ensures the delivery
of a consistent level of high quality products and services for
customers.
Employee development
The Group’s headquarters and R&D centres are in Israel, a
major global hub for technology and innovation, where there
is a skilled and educated workforce which is highly trained in
all elements of technological development. Plus500 has
fostered an entrepreneurial and high-performance
organisational culture that reflects Israel’s technology-based
environment. The Group aims to replicate this cultural mindset
in each of its global subsidiaries, as has been the case
historically.
This has created a working environment which empowers on-
going improvements in employee development, through
training, learning and career progression. This includes
Group-subsidised training programmes for employees to
enhance their understanding of a number of commercial
areas, including technology and marketing. The Group also
runs a programme which involves a series of expert lectures
for employees to broaden their knowledge outside of their
day-to-day roles.
Furthermore, the Group carries out annual performance
evaluations for all employees, to help continue their
development and meet their career aspirations at Plus500.
The Group is committed to fair wages for all employees and
enables them to participate in its success through competitive
reward packages, alongside share-related benefits that are
linked to the financial and operational performance of
Plus500.
29 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
Employee health, safety and well-being
The Group is particularly dedicated to the health, safety and
wellbeing of its people and aims to continue to provide them
with optimal working conditions to support a healthy, safe and
balanced working environment.
Employees at the Group’s headquarters are encouraged to
make use of Plus500’s office facilities, resources and events,
including organised social activities, lectures, access to a
private gym, yoga and pilates classes, team retreats, a varied
library, a fully equipped kitchen, meal vouchers and other
benefits.
Furthermore, to help drive even greater employee satisfaction,
the Group provides gifts and merchandise to employees at its
headquarters to celebrate such events as public holidays and
employees’ birthdays and weddings. The Group also holds
annual employee events, with various departments arranging
regular “family days” and team events across its global
operations. There were no employee fatalities in FY 2022, nor in
any of the prior two fiscal years.
The Group’s approach to equal opportunity, protecting
human rights and employee diversity
Plus500 is committed to maintaining high ethical standards
and protecting human rights across its operations and supply
chain. The Company’s Human Rights and Modern Slavery
Statement pursuant to Section 54 of the UK Modern Slavery Act
2015, can be found on the Company’s website. In FY 2022, the
Group continued to monitor and track potential human rights
and modern slavery issues, as part of its overall compliance
risk management programme. It was found that there were no
incidences of modern slavery or human rights abuses across
the Group’s operations.
The Group is committed to equal opportunity in employment
and to creating, managing, valuing and promoting diversity
and eliminating discrimination in its workforce. The Group
maintains an Equality, Diversity and Inclusion Policy with
respect to candidate selection processes, hiring, promotion,
compensation, training and assignment of responsibilities,
termination or any other aspect of the employment
relationship.
The Group is also committed to equality and fairness to all and
does not provide less favourable facilities or treatment on the
grounds of characteristics such as age, disability, gender,
gender reassignment, marriage and civil partnership,
pregnancy or maternity, race, ethnic origin, colour, nationality,
national origin, religion or belief, sex or sexual orientation,
educational, professional, cultural and social-economic
backgrounds, political opinion, sensitive medical conditions
and trade union membership.
Plus500’s people come from diverse backgrounds and the
Group ensures that all employees, both prospective and
current, are given access to equal opportunities. All
employees, whether they are part-time, full-time or temporary,
will be treated fairly and with respect.
Plus500’s people come from
diverse backgrounds and
the Group ensures that all
employees, both prospective
and current, are given access
to equal opportunities.
Our ESG Approach continued
30 Plus500 Ltd. Annual Report 2022
The Group is committed to achieving the purpose of its
Equality, Diversity and Inclusion Policy by:
+ Creating a secure and positive working environment:
+ free of bullying, harassment, victimisation and unlawful
discrimination in which individual differences and the
contributions of all staff are recognised and valued.
+ that promotes, and encourages all staff to treat
everyone with dignity and respect.
+ that promotes equality, diversity and inclusion. This
includes training managers and all other staff about
their rights and responsibilities under this policy
throughout the period of their employment.
+ Not tolerating, and taking seriously, complaints of any form
of intimidation, bullying, harassment, victimisation or
unlawful discrimination by staff, customers, suppliers,
visitors, the public and any others in the course of the Group’s
work activities and to take appropriate action where
breaches of this policy arise.
+ Making training, development and progression
opportunities available to all staff, who will be helped and
encouraged to develop their full potential, so their talents
and resources can be fully utilised to maximise the efficiency
of the organisation.
+ Encouraging anyone who feels they have been subject to
any form of discrimination raised in this policy, or otherwise,
to raise their concerns in a timely manner so the Group can
take appropriate action.
+ Reviewing the Group’s employment practices and
procedures when necessary to ensure fairness is
maintained at all times and to ensure that they take account
of any changes in any relevant local law.
The Equality, Diversity and Inclusion Policy is monitored and
reviewed annually by the Board, with the assistance of the
Nomination Committee and the ESG Committee, to ensure
that equality, diversity and inclusion are continually promoted
in the workplace.
The Group’s organisational culture and mindset has helped to
drive employee attraction and retention and has ultimately
led to the Group’s innovation and technological excellence.
More information on Equality, Diversity and Inclusion Policy
can be found on page 65 of this Annual Report. This policy can
also be found on the Company’s website.
Gender equality
The Group is committed to the progression of its talented
women, with female representation across the Group
remaining relatively strong. Plus500’s gender diversity
statistics as at 31 December 2022 were as follows:
Female Male Total
Board 4 (50%) 4 (50%) 8
Senior management 14 (38%) 23 (62%) 37
All employees 240 (46%) 281 (54%) 521
Senior management in the table above includes executive
management and the first layer of management below.
During FY 2022, gender diversity at Board level was further
improved through the appointment of Prof. Varda Liberman as
an Independent Non-Executive Director.
This appointment not only continues to diversify the Board’s
gender composition, but also further expands the range of the
Board’s expertise, knowledge and experience. Plus500
believes that diversity across the Board and the Group is an
important element in maintaining competitive advantage
and effective governance, as well as mitigating the risk of a
“group think” culture. As at the date of this Annual Report,
female representation on the Board comprised 50% (four
female Directors out of eight Directors).
Information and data security
Ensuring that the Group’s technology remains highly secure
and immune from breaches of privacy, particularly around
personal information and data, is another key priority area.
The Group’s corporate IT and information and data security as
well as the specialist cyber security team, which reports to the
Group’s Chief Operating Officer, is responsible for Information
and data security matters relating to Plus500’s offices and
employee devices, as well as running an on-going employee
security awareness programmes.
Product and customer data security is led by a team reporting
to the Group’s Chief Technology Officer. This team ensures the
Group’s systems across all layers (from infrastructure to
applications, products and data) and across all environments
(for example production and development) are kept highly
secure.
46%
54%
Female
Male
Gender equality:
all employees
521 total
31 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
Our ESG Approach continued
As a result of the rigorous systems and processes established
by these teams, there were no security or data breaches
across the Group’s platforms during FY 2022, nor in FY 2021. In
addition, no customers were affected by data breaches in FY
2022, nor in the previous two fiscal years.
The Group’s IT infrastructure production environment is hosted
by a third party supplier, which is certified under ISO/IEC 27001,
ISO 14001, ISO 18001 and ISO 9001 compliance certifications.
Systems infrastructure
Maintaining a robust systems infrastructure, with embedded
risk management features and in-built redundancy, remains
crucial to ensure that Plus500 customers receive a consistent
level of service. This is supported by continued investment by
the Group in the development of its technology.
The Company continues to invest in its systems architecture,
to support customer requirements. Google Cloud Services
provides additional flexibility, security and scale to the
platforms, additional server capacity and redundancy, as well
as enhanced data analysis, data processing and business
intelligence capabilities. This supports the Company’s main
data centres, which host its trading platforms and major
network equipment.
The strength of the Company’s IT infrastructure has ensured
that the core platform has consistently delivered the capacity
to support significant volumes, including the multiple volume
spikes which have rapidly, and sometimes instantly, arisen on
demand in recent years.
Anti-bribery and corruption
As a company listed on the Main Market of the London Stock
Exchange in the UK, Plus500 is subject to the UK Bribery Act 2010
and, as a company incorporated in Israel, it is also subject to
anti-bribery and anti-corruption regulation under applicable
Israeli law.
Plus500 operates a zero-tolerance approach to bribery and
corruption. The Group’s Anti-Bribery Policy ensures it conducts
all business in an honest and ethical manner whilst acting
professionally and fairly with integrity in business dealings
and relationships.
This policy applies to all individuals working for Plus500, at all
levels and grades, as well as consultants, contractors, trainees,
seconded staff, homeworkers, casual workers and agency
staff, volunteers, interns, agents, sponsors, or any other person
associated with Plus500, or any of its subsidiaries or their
employees, wherever located. This policy covers:
+ Bribes;
+ Gifts, hospitality and expenses;
+ Facilitation payments;
+ Third-party suppliers or agents;
+ Client entertainment and benefits;
+ Money laundering;
+ Obstruction of justice;
+ Political contributions; and
+ Charitable contributions.
The prevention, detection and reporting of bribery and other
forms of corruption are the responsibility of all employees of
the Group. All individuals are required to avoid any activity that
might lead to, or suggest, a breach of this policy and to raise
any concern, should they have any, in this regard to the
Company Secretary, who shall keep these concerns strictly
confidential. Internal control systems and procedures are
subject to regular audits to provide assurance that they are
effective in countering bribery and corruption.
Training on the Anti-Bribery Policy forms part of the introduction
process for all of the Group’s new recruits. All of the Group’s
employees receive relevant training on how to implement and
adhere to all aspects of the policy.
The Anti-Bribery Policy and its implementation is reviewed on
a regular basis, and annually at Board level, to ensure that
Plus500 conducts all of its business in an honest and ethical
manner.
Plus500 prohibits donations, whether in cash or in kind, and
involvement of any kind in support of any political parties or
candidates. In addition, to avoid criminal offence and to
protect the Group’s reputation, it is important that the Group
does not become involved with third-party criminal activities.
To this end, the Group continues to ensure that it does not
receive funds relating to criminal activities which could be
associated with money laundering (the activity of taking the
proceeds of criminal activity, and disguising the origin, identity
and destination of this illicit money through a series of
transactions).
Community engagement
The Group encourages its people to get involved and
contribute to their local communities. Workforce social
initiatives are supported by Plus500’s Donations Committee
comprised of workforce volunteers, which oversees the
planning and performance of relevant activities, with
meetings occurring on a quarterly basis. The CEO, VP of Human
Resources and the Company Secretary are also members of
this Committee.
During FY 2022, supervised by the Group’s Donations
Committee, the Group made cash donations to various
community projects and non-profit organisations in Israel,
including to women and children at risk, holocaust survivors,
as well as to a youth support programme and a number of
education support and enrichment programmes for deprived
and vulnerable children in local communities. In addition, the
Group donated IT equipment and clothing to various charities
and local community initiatives.
Plus500 maintains strategic partnerships and alliances with
community partners, such as the on-going collaboration with
top tier academic institutions like the ‘Technion – Israel Institute
of Technology’, participating in innovation and
entrepreneurship initiatives.
The Group aims to carry out new employee-volunteer
community initiatives during paid working hours in the local
community going forward, and to expand the level of in-kind
contributions.
32 Plus500 Ltd. Annual Report 2022
The Group is committed to managing its environmental
impact, which results from the energy usage relating to the
maintenance of the Group’s IT infrastructure and the operation
of its network of offices around the world. As a technology
business, Plus500 does not carry out any industrial activity, is
not involved in anything which would emit environmentally
harmful substances and has a relatively low environmental
impact. However, the Group aims to ensure that it conducts
appropriate and necessary actions to minimise the impact of
its infrastructure and operations on the environment, with
commitments to:
+ Protect the environment;
+ Reduce waste as well as water, energy and resource use;
+ Monitor the Group’s environmental performance;
+ Provide environmental training for employees; and
+ Ensure that office services are sourced from providers that
share these commitments.
Plus500 received no environmental fines or penalties in FY
2022, or in the prior two fiscal years.
Emissions reporting
The tables below outline the Group’s energy and emissions
output over the last two years, particularly in relation to Scope
2 emissions, which have been calculated using a location-
based calculation method based on the Greenhouse Gas
Protocol (the Group does not emit any Scope 1 emissions, given
the nature of its business).
Emmissions table
Energy consumption (kWh)
FY22 FY21
UK
Global
(excl U K) Group Total UK
Global
(excl U K) Group Total
Total Group energy consumption (kWh)
40,354 687,320 727,674 39,706 535,670 575,376
GHG Emissions (tCO
2
e)
FY22 FY21
UK
Global
(excl U K) Group Total UK
Global
(excl U K) Group Total
Total Scope 1 (tCO
2
e)
0 0 0 0 0 0
Total Scope 2 (tCO
2
e)
7.8 292.1 299.9 7.6 227.5 235.1
Total Scope 1 & 2 (tCO
2
e)
7.8 292.1 299.9 7.6 227.5 235.1
Intensity measure (Group turnover $m)
832.6 718.7
GHG Emissions Intensity Ratio (per Group turnover $m)
0.36 0.33
The two factors within the Group’s business with the most
significant potential environmental impact, in relation to
emissions, are:
+ The maintenance of Plus500’s technology infrastructure, in
particular the management of the various data centres and
servers that are owned or leased by the Group around the
world; and
+ The Group’s global office network.
In FY 2022, electricity consumption and expenditure increased
compared to FY 2021 mainly due to the expansion of the Group
with the additions of local operations in the US, Japan and
Estonia and the opening of the R&D site in Tel Aviv resulting in a
higher number of employees and offices around the world, to
support the growth of the business.
The Group is on track to meet its commitment of becoming
carbon negative and net zero for Scope 1 and Scope 2
emissions by 2030. This commitment will be supported by a
number of activities, including looking for opportunities to
improve the efficiency and performance of its servers and
third-party data centres. The Group continues to investigate
ways to measure its Scope 3 emissions and, when finalised,
the Group will report on these Scope 3 emissions, including
them in future disclosure and, potentially, incorporating them
into the Group’s emissions targets.
The Group has adopted an Environmental Policy, which can be
found on the Company’s website.
Report on the Task Force on Climate-Related Financial Disclosures (TCFD)
MINIMISING OUR
ENVIRONMENTAL IMPACT
33 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
In 2022, the Group continued making progress towards its
climate strategy. The following pages cover Plus500’s
governance of climate change, the integration with overall risk
management, strategy in managing climate-related issues
and opportunities, and the metrics to measure progress
towards our targets. In recognition of Listing Rule 9.8.6R(8), the
following pages set out the Group’s climate-related financial
disclosures, consistent with the TCFD Recommendations and
Recommended Disclosures as detailed in “Recommendations
of the Task Force on Climate-related Financial Disclosures”,
2017, with use of additional guidance set out in the Company’s
TCFD 2021 Annex as part of the 2021 Annual Report,
“Implementing the Recommendations of the Task Force on
Climate-related Financial Disclosures”.
The Group has a net zero target for Scope 1 and Scope 2
emissions by 2030 or earlier and in turn recognises the
requirement to develop a transition plan inclusive of value
chain emissions, consistent with the UK Government’s net zero
commitment.
Recommendation Recommended disclosures (outlined in various pages throughout this Annual Report)
Governance
Disclose the organisation’s governance
around climate-related risks and
opportunities
a) Describe the Board’s oversight of climate-related risks and opportunities
b) Describe management’s role in assessing and managing climate-related
risks and opportunities
Strategy
Disclose the actual and potential
impacts of climate-related risks and
opportunities on the organisation’s
businesses, strategy and financial
planning where such information is
material
a) Describe the climate-related risks and opportunities the organisation has
identified over the short, medium and long term
b) Describe the impact of climate-related risks and opportunities on the
organisation’s businesses, strategy and financial planning
c) Describe the resilience of the organisation’s strategy, taking into consideration
different climate-related scenarios, including a 2°C or lower scenario
Risk Management
D i s c l o s e h o w t h e o r g a n i s a t i o n i d e n t i fi e s ,
assesses and manages climate-
related risks
a) Describe the organisation’s processes for identifying and assessing climate-
related risks
b) Describe the organisation’s processes for managing climate-related risks
c) Describe how processes for identifying, assessing and managing climate-
related risks are integrated into the organisation’s overall risk management
Metrics and Targets
Disclose the metrics and targets used to
assess and manage relevant climate-
related risks and opportunities where
such information is material
a) Disclose the metrics used by the organisation to assess climate-related risks
and opportunities in line with its strategy and risk management process
b) Disclose Scope 1, Scope 2 and, if appropriate, Scope 3 greenhouse gas (GHG)
emissions, and the related risks
c) Describe the targets used by the organisation to manage climate-related risks
and opportunities and performance against targets
Report on the Task Force on Climate-Related Financial Disclosures (TCFD) continued
34 Plus500 Ltd. Annual Report 2022
Governance
Board level
At Plus500, the Board has overall responsibility for climate
change management, including oversight of climate-related
risks and opportunities, as with all matters which impact the
strategy, risk management, vision and direction of the Group.
ESG matters, including climate change, are discussed more
than once a year at Board meetings and the Board receives
regular training on sustainability issues that have the potential
to impact the businesses, including climate change.
The Board is supported and informed on climate-related
issues via the ESG Committee, which ensures that any
potential impacts of climate change are incorporated into the
review of Group strategy, business plans and risk
management. The ESG Committee was established in 2020
and is chaired by Steve Baldwin, an Independent Non-
Executive Director. The ESG Committee monitors progress
against the Group’s ESG approach and priority areas, and is
responsible for externally reporting these elements.
The ESG Committee meets at least twice a year, as outlined in
the ESG Committee Terms of Reference, and provides updates
to the Board at least annually. In 2022, the ESG Committee met
three times.
Progress against the Group’s net zero targets and its climate-
related risks and opportunities is monitored and overseen by
the Board, based on information (progress and metrics as
outlined below) received from the ESG Committee.
Management level
As a member of Plus500’s ESG Committee, David Zruia, the
Group CEO is responsible for management-level climate
change oversight. The ESG Committee receives input from
executive management but is predominantly supported by
the Company’s internal ESG working group. The ESG working
group was established in FY 2021 to assist the ESG Committee
in monitoring and reviewing ESG risks and opportunities. The
ESG working group comprises of the Company Secretary and
Head of Investor Relations, who work with a specialist ESG
consultancy for external guidance.
The ESG Committee receives reports on ESG risks, including
climate-related risks, identified through the Group’s Risk
Management Framework and, with support from the ESG
working group, determines the nature and potential impact of
climate-related risks and opportunities facing the Group in
achieving its purpose and strategic objectives. The ESG
Committee subsequently advises the Board, when necessary,
on current and future strategies regarding climate-related
risks and opportunities.
Risk management
Plus500’s climate-related risk management is integrated into
the Group’s overall risk management framework. All climate-
related risks are assessed in the same manner as other Group
risks, so that their relative significance is comparable. The
Group’s Risk Register categorises all existing and emerging
risks, including climate-related risks, with the register covering
the likelihood of the risk occurring and the degree of the
potential impact. Climate-related risks and opportunities
relevant to the Group were identified with the help of external
consultants, CEN-ESG, in collaboration with senior
management. All risks are assessed on a 5x5 matrix
incorporating an assessment of both impact and likelihood,
which allows for the prioritisation of risks.
Risk impact (materiality) is defined by the table below.
Risk likelihood is defined under five categories: Slight, Not Likely,
Likely, Highly Likely and Expected.
Risk mitigation factors for all risks, including climate-related,
are included in the Risk Register and this combined view
determines the approach for managing climate-related risks
(e.g., mitigation, accept or control). ESG-related risks are
reviewed annually to reflect new and developing areas in the
operating environment which might impact business strategy
and to include the on-going refinement and quantification of
risks over time. Internally, the cost of mitigation is described
(where possible) along with an explanation of how this is
derived. The Regulatory & Risk Committee meets at least three
times a year, with all Board members receiving Risk &
Compliance reports on a monthly basis.
Strategy
Time horizons for the climate-related risk assessment have
been chosen on the basis that they encompass our emissions
reduction targets and as climate change impacts tend to
materialise in the longer term; short- (0 to 3 years), medium-
(2025-2030), or long-term (2031-2040). Climate change has
had observable effects on the environment and at Plus500 we
realise climate change may present both risks and
opportunities to the business.
As an asset-light technological business, Plus500’s overall
climate risk exposure is limited. For example, our only potential
physical risk exposure identified using a geo-spatial tool (flood
risk in Haifa, Israel) is considered to be extremely limited and
very unlikely in reality, and is mitigated by established home
working procedures, insurance recovery in the event of natural
disasters. Transition risks were analysed, but deemed limited.
Impact Minor Low Medium High Critical
Financial impact X < $9m
1% from cash
$9m < X < $20m $20m < X < $40m $40m < X < $60m 15% from EBITDA
($65m)
or 10% cash
($90m)
35 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
The Group has used scenario analysis to improve
understanding of how different climate outcomes may affect
the behaviour of risks, and thereby improve the resilience of
the business to climate change. Three climate-related
scenarios have been selected, looking forward to our long-
term time horizon of 2040:
+ Net Zero 2050 (NZE)
1
outlining a pathway for the global
energy sector to achieve net zero CO
2
emissions by 2050,
which limits the global temperatures rise to 1.5°C by 2100,
with 50% probability. This scenario is included as it informs
decarbonisation pathways used by the Science-Based
Targets initiative (“SBTi”).
+ Stated Policies (STEPS)
1
outlining a combination of physical
and transitions risk impacts as temperatures rise by 2.5°C by
2100, with 50% probability. This scenario is included as it
represents a midway path with the trajectory implied by
today’s policy settings.
+ RCP 8.5
2
where global temperatures rise between 4.1-4.8°C
by 2100. This scenario is included for its extreme physical
climate risks as the global response to mitigating climate
change is limited.
The Group has analysed and quantified how each climate-
related risk and opportunity behaves under the three
scenarios in line with definitions for risk impact outlined above.
When taken in aggregate, the conclusion is that the Group’s
exposure, risk mitigation strategies, strategy, disclosure and
ambition provide financial resilience and strategic robustness
to climate change with the Group’s overall climate-related risk
1. IEA (2022), “World Energy Outlook 2022”, IEA, Paris.
2. IPCC, 2014: “Climate Change 2014: Synthesis Report. Contribution of Working Groups I, II and III to the Fifth Assessment Report of the Intergovernmental
Panel on Climate Change”.
exposure being “Minor”. A fundamental change to the business
strategy or financial planning resulting from the impact of
climate change is not likely to be required through to 2040 and
there are no effects of climate-related matters reflected in
judgements and estimates applied in the financial statements
as a result. The Group will continue to develop this analysis as
new data is made available both internally and externally and
the Group will continue to monitor climate exposures and
action plans through the Group’s risk management framework.
The opportunities identified continue to be developed in line
with the Company’s strategy and objectives.
Risks
Two key climate-related risks have been identified:
1. Risk to Plus500 not meeting its Scope 1 and 2 Net Zero and
Carbon Negative Targets
Plus500 has clear targets associated with climate change
and a continual obligation to report to external stakeholders
to provide evidence of the Group’s on-going commitment to
this area. However some aspects of the delivery against this
plan are reliant on third parties. At present the only source of
operational emissions for the Group are within Scope 2
(electricity purchased), where the ability to decarbonise
electricity supply may be hindered by the pace of renewable
energy adoption by the Group offices’ landlords. The location
of some sites may have more limited options for renewable
energy. Failure to meet the defined net zero targets may cause
reputational damage, dissuade potential investors, or result in
greater costs due to the introduction of carbon pricing.
Risk
Risk to Plus500 not meeting Scope 1 and 2 Net Zero and
Carbon Negative Targets
Carbon pricing in the value chain
Type
Transition (market and reputation) Transition (current and emerging
regulation)
Area
Own operations Upstream
Primary potential financial impact
Potential impact on revenue and/or
cost of capital
Higher costs associated with energy
and other inputs
Time horizon
Medium/Long term Medium term
Likelihood
Not likely Highly likely
Impact
Minor Minor
Location or service most impacted
Group Purchased goods & services
Report on the Task Force on Climate-Related Financial Disclosures (TCFD) continued
36 Plus500 Ltd. Annual Report 2022
3. Based on a 100% reduction from 2022 as the base year of which Scope 2, location-based emissions from purchased electricity was 299.9 tCO
2
e.
The following table below estimates the residual emissions for
Plus500 based on the Group’s 2022 emissions, after factoring
in forecast electricity grid decarbonisation and the successful
completion of the Group’s near term target of reducing Scope
1 and 2 emissions to net zero by 2030. Results are shown under
both STEPS and NZE scenarios projected out to 2040. The
resulting emissions balance thus requires direct action from
Plus500 or indirect action from third parties. Even with extreme
carbon pricing of $200 per ton, the overall impact would
be minor.
The Group typically operates with short-term leases, making it
feasible to move operations in areas where it is difficult to find
renewable energy contracts with landlords.
Scenario
Plus500 Scope 2 residual
emissions (tCO
2
e)
2022 2030 2040
STEPS
No internal action
(grid decarbonisation
only)
299.9 224.5 153.4
Net Zero by 2030
3
299.9 0 0
NZE
No internal action
(grid decarbonisation
only)
299.9 123.8 0
Net Zero by 2030
3
299.9 0 0
2. Carbon pricing in the value chain
The cost of carbon and the number of countries adopting
carbon price mechanisms is expected to rise as businesses
are made more accountable for their energy use and carbon
emissions. As Plus500’s suppliers come under carbon pricing
mechanisms this could result in suppliers passing on the
added cost from the carbon tax. The following table shows the
International Energy Agency’s (“IEA”) forecasts for carbon
pricing under NZE and STEPS scenarios. Whilst quantification is
reliant on a full Scope 3 footprint analysis, Plus500’s current
assessment of this risk is minor.
Carbon Price
estimates (US$/t)
Scenario – STEPS 2030 2040
UK* 90 98
Scenario – NZE 2030 2040
UK* 140 205
* Used as Global estimate.
OPPORTUNITIES
Two key climate-related opportunities have been identified:
Opportunity 1. Energy Savings 2. Renewable Energy
Type
Resource efficiency Energy source
Primary potential financial impact
Decreased costs Decreased costs
Time horizon
Medium term Medium term
Likelihood
Highly likely Expected
Impact
Minor Minor
Location
Group Group
KPI
Total Group energy consumption (kWh) Proportion of global electricity from
renewable sources (%)
1) Energy savings
Decreasing energy consumption and increased energy
efficiency may decrease outgoing costs and mitigate against
the cost of future carbon pricing. This will have the emergent
benefit of further mitigating the impact of Risk 1 outlined above.
As the Group’s offices are leased, the strategy to realise this
opportunity will partly involve engagement with landlords to
introduce energy saving measures. Implementing best
practice in energy management in current offices will also be
a factor in reducing consumption. Alternatively, the business
has the opportunity to move to more energy efficient locations
at the time of lease renewal.
2) Renewable energy
Transitioning to renewable energy sources (self-generation or
power purchase agreements) can help in reducing market-
based Scope 2 emissions to zero. As office locations are not
owned, the most likely route for the Group is to negotiate with
landlords for the supply of renewable energy. Given the
typically short-term nature of the Group’s leases and energy
requirements of a services-based business, investment in
self-generation would likely be unfeasible.
Metrics and targets
Plus500 has a clear target to be net zero for Scope 1 and Scope
2 emissions by 2030 or earlier, which is in line with the UK
government’s commitment to net zero by 2050. The Group
reports its Scope 1 and 2 greenhouse gas emissions, calculated
in line with the Greenhouse Gas Protocol and discloses total
energy consumption. In line with the risk and opportunities
identified, the Group has also initiated an internal reporting
process to understand the proportion of global electricity
from renewable sources.
Whilst acknowledging the TCFD recommendations to
integrate an internal carbon price into Group processes, the
risk assessment process has highlighted that at this point,
climate-related risks are financially immaterial to Plus500 and
therefore deemed unnecessary to implement. However, it
may be used in assessing any future large capital expenditure
and investment activities.
Additional metrics that monitor the climate-related risks and
opportunities, such as upstream and downstream Scope 3
emissions, are being considered for future reporting.
37 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
FY 2022 was another outstanding year for Plus500 and I am
delighted with our operational progress, commercial
successes and the financial performance that we delivered
during the year. In our 10th anniversary year as a publicly listed
entity on the London Stock Exchange, Plus500 has built a very
substantial track record of consistently delivering against all
operational and financial KPIs. This track record and our
subsequent reinforced financial position ensured an excellent
performance in FY 2022, against a challenging macro-
economic environment.
Plus500 continues to hold no debt or loans, has a flexible and
lean cost base which is predominantly weighted to variable
costs and financial expenses which have a relatively low
exposure to the current macro inflationary environment. This
financially responsible culture and approach, embedded
within the Group since inception, continues to enable Plus500’s
focused strategic investments and, ultimately, its strong
financial performance.
With strong financial foundations in place in place, the Group
can continue to execute on its strategy of entering new
geographies and expanding our product offering, through
on-going organic investments and targeted acquisitions.
Financial and Business Review – Statement of the Chief Financial Officer
WELL POSITIONED
FOR GROWTH
Plus500 delivered
another outstanding
performance in FY 2022,
as our business continues to
execute on its strategy of
entering new geographies
and expanding our product
offering, through on-going
organic investments and
targeted acquisitions
Elad Even-Chen
Chief Financial Officer
Revenue
$832.6m
(FY 2021: $718.7m) 16% Growth
EBITDA
$453.8m
(FY 2021: $387.1m) 17% Growth
EBITDA margin
55%
(FY 2021: 54%)
Operating cash conversion
112%
(FY 2021: 99%)
38 Plus500 Ltd. Annual Report 2022
Variable costs remain positively correlated to enhanced
performance and higher volumes. In FY 2022, 70% of the
Group’s costs were variable (FY 2021: 72%), with Plus500
maintaining a flexible and controlled cost base.
Total SG&A expenses were $382.2m during FY 2022 (FY 2021:
$334.1m), the major elements of which were marketing
technological investment of $157.8m (FY 2021: $172.1m),
commissions to processing companies of $44.9m
(FY 2021: $40.8m) and payroll and related expenses of $40.5m
(FY 2021: $33.0m).
Investing in long-term, high value customers
Plus500 continued to invest in strategic markets to attract
higher value customers for the long term. As a result, AUAC was
$1,481 in FY 2022 (FY 2021: $877). We continue to expect that
AUAC will rise steadily over time, as our customer profile further
shifts to higher value, long-term customers and as we invest in
attracting customers to the new trading products in our
portfolio and targeting additional high value customers in
strategic geographies.
As a result of this on-going investment, long-term customer
loyalty significantly increased during the year, with 87% of FY
2022 OTC revenue derived from customers trading with
Plus500 for more than a year, 40% for more than three years
and 24% for more than five years.
Net financial income
Financial income, net, for FY 2022 was $23.9m (FY 2021: $1.8m),
mainly as a result of developments in the global interest rate
environment and its positive impact on the Group’s cash
balances. In addition, in order to manage the exposure
between the US dollar, as the functional currency of the Group,
to the other range of currencies applicable to the Group’s
operations, a substantial proportion of the Group’s cash is held
in US dollars, to reduce the impact on financial exposure. This
approach also enabled the Group’s strong financial income
performance.
Corporate tax
In January 2022, the Company’s status as a Preferred
Technological Enterprise (“PTE”), as accredited by the Israeli
Tax Authority (“ITA”) under the tax regime in Israel, was extended
for the financial years 2022, 2023, 2024, 2025 and 2026, subject
to the Company complying with the conditions of the Law for
the Encouragement of Capital Investments, 5719-1959
(“Investment Law”). Consequently, the Company’s corporate
tax rate for each of these years will be reduced from 23% to 12%
and the withholding tax rate applicable for dividends will be
reduced from 25% to 20%. For further information, see notes 3
and 10 to the Consolidated Financial Statements.
Business development
The Group made great progress in business development
during the year through pursuing a range of potential growth
opportunities. Major achievements included obtaining a new
regulatory licence in Estonia to strengthen the Group’s OTC
offering in Europe, supported by the establishment of a new
local subsidiary.
In March 2022, the Company completed an acquisition of a
local regulated firm in Japan, representing a major growth
opportunity for Plus500, through immediate access to the
substantial Japanese retail trading market.
In February 2023, the Group obtained a regulatory licence in
the United Arab Emirates, granted by the Dubai Financial
Services Authority (DFSA), offering a major potential growth
opportunity for Plus500, by allowing expansion of our offering
to customers in a significant and high growth market.
The business development team made further progress
during the year in exploring a number of other growth
initiatives, including advancing the Group’s position with
several other potential regulatory licence applications and
acquisition targets.
In addition, continued progress was made during the year in
further advancing a number of significant strategic growth
opportunities in the US futures market.
Revenue, EBITDA, net profit and earnings per share
The Group generated total revenue in FY 2022 of $832.6m,
representing a 16% increase year-on-year (FY 2021: $718.7m).
EBITDA for FY 2022 increased by 17% to $453.8m (FY 2021:
$387.1m). EBITDA margin increased during FY 2022 to 55% (FY
2021: 54%). Net profit in FY 2022 increased by 19% to $370.4m (FY
2021: $310.6m) and basic earnings per share increased by 25%
to $3.81 (FY 2021: $3.06).
Cost base
The Group’s cost base remained well contained, supported by
the fact that its cost base continues positively to be heavily
weighted towards variable costs, which is a key financial
strength in an uncertain and dynamic economic environment.
Furthermore, in the face of an extremely volatile foreign
exchange environment in FY 2022, the Group’s management
of currency risk continued to be efficient and dynamic.
Our cost base remains well
managed and very flexible, given
it is heavily weighted towards
variable costs. Plus500’s financial
position remains very strong,
with cash balances of over
$930m at year end, and without
debts or loans.
39 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
Financial and Business Review – Statement of the Chief Financial Officer continued
Balance sheet and cash generation
As at the end of FY 2022, total assets were $1,010.0m (FY 2021:
$822.8m) with equity of $780.5m, representing approximately
77% of the balance sheet, with no debt or loans.
The Group remains highly cash generative, supported by the
relatively low levels of capital expenditure as a result of its
automation and technological capabilities, with cash
generated from operations during the year of $506.8m (FY
2021: $383.0m) and 112% operating cash conversion achieved
(FY 2021: 99%). As a result, with the Group remaining debt-free,
the cash and cash equivalents balance at the end of FY 2022
was $930.2m (FY 2021: $749.5m).
Presentation of currencies
The Consolidated Financial Statements are presented in US
dollars, which is the Group’s functional and presentation
currency. Foreign currency transactions and balances in
currencies different from the US dollar are translated into the
US dollar using the exchange rates prevailing on the dates of
the transactions or at the balance sheet date.
Shareholder returns
Since its IPO in 2013, Plus500 has returned approximately $1.7
billion to shareholders, through dividends and share buybacks.
The Company’s shareholder returns policy is to return at least
50% of net profits to shareholders through share buyback
programmes and dividends, on a half yearly basis with at
least 50% of this distribution being made by way of share
buybacks. The Board will also consider executing special
share buybacks, or other distributions, on a half yearly basis,
dependent on fiscal year results as well as on investments and
growth opportunities. This shareholder returns policy applies
to net profits on a half-yearly basis and is based on a 23%
corporate tax rate, for both interim and final distributions.
The Company returned $270.2m to shareholders in relation to
FY 2022, comprised of $180.2m in share buybacks and $90.0m
in dividends. The announced share buyback programmes in
respect of FY 2022 include a final buyback programme to
purchase up to $42.4m of the Company’s shares and a special
buyback programme to purchase up to $27.6m of the
Company’s shares, which are currently underway. We also
conducted a share buyback programme of $60.2m,
announced on 17 August 2022, and a special buyback
programme of $50.0m, announced on 13 April 2022, both of
which completed. These share buyback programmes
emphasise the Board’s continued confidence in the prospects
for Plus500 and reflect the robust financial position of the
Group. Total dividends for FY 2022 of $90.0m, ($0.9472 per
share), comprise a final dividend for FY 2022 of $20.0m, a
special dividend of $10.0m, and an interim dividend of $60.0m.
The interim dividend was distributed to shareholders in
November 2022. The final and special dividends had an ex-
dividend date of 23 February 2023, with a record date of 24
February 2023, and a payment date of 11 July 2023.
Elad Even-Chen
Chief Financial Officer
22 March 2023
Group Tax Policy
The Group actively seeks to comply with both the spirit and
the letter of all relevant taxation laws and regulations
where it operates, and it is committed to a transparent
and open approach to reporting on tax. The Group’s policy
is to file all tax returns on time, and to pay tax as it falls due.
The Group has a low risk tolerance for uncertain tax
positions in the jurisdictions in which it operates and does
not undertake any aggressive or unreasonable tax
planning schemes for the purpose of tax avoidance, and
broadly aims to align tax payments to revenue generation.
The Group does not knowingly help others avoid their tax
obligations.
During FY 2020, Plus500 Ltd became one of the first
companies to receive approval from both the ITA and the
Israeli Innovation Authority (“IIA”) under the new tax regime
in Israel, recognising the Company as a PTE and as “an
enterprise which promotes innovation”. At the beginning of
July 2020, Plus500 Ltd received an approval from the IIA
that together with the tax ruling received from the ITA in
May 2019, recognises Plus500 Ltd as a PTE. In January 2022,
the Company’s status as a PTE, as accredited by the ITA
under the tax regime in Israel, has been extended for the
financial years 2022, 2023, 2024, 2025 and 2026.
Consequently, the Company’s corporate tax rate for each
of these years will be reduced from 23% to 12% and the
withholding tax rate applicable for dividends will be
reduced from 25% to 20% subject to the Company
complying with the conditions of the Investment Law. See
also note 3 and note 10 to the Consolidated Financial
Statements.
All intra-group transactions are required to be priced on
an arm’s length basis in accordance with the Group’s
internal transfer pricing policies which reflect
internationally accepted transfer pricing standards and
local tax laws, approved by leading international
accounting firms as well. Taxation is a regular agenda
item for the Audit Committee, which meets at least four
times a year, and reports to the Board. Tax compliance
risks are managed through the Group’s Governance
Framework, overseen by its Audit Committee, and
supported by the Chief Financial Officer.
40 Plus500 Ltd. Annual Report 2022
Governance
The role of the Board
The Board is ultimately responsible for the risk strategy, having
developed a Risk Governance Framework, which is regularly
reviewed and assessed by the Board, particularly with regards
to principal and emerging risks.
The Board believes that the robust, technology-driven risk
management systems of the Group are a key competitive
strength and an important factor in its revenue generation.
The implementation of the risk strategy is delegated to
management under the more detailed supervision of the
Regulatory & Risk Committee.
The role of the Regulatory & Risk Committee
The Regulatory & Risk Committee receives updates from
management on risk, compliance and regulatory issues and
reviews the related internal systems. This Committee also
receives monthly reporting packages relating to risk and
compliance.
The Regulatory & Risk Committee is responsible for reviewing
relationships with the regulatory authorities and reviewing the
adequacy and quality of the Group’s systems and procedures
for compliance with relevant regulatory requirements where
the Group is regulated and in other jurisdictions where the
Group has a significant market presence. The Regulatory &
Risk Committee also has responsibility for reviewing the
Group’s most significant risks to the achievement of strategic
objectives and reviewing the Group’s risk management policy.
Lines of defence
Within the Risk Governance Framework, three lines of defence
are created through:
+ Front-line risk management processes
+ Regulatory compliance
+ Independent assurance provided by internal audit
First line of defence
The first line of defence consists of front-line risk management
processes operated by management within the day-to-day
trading activities of the Group’s business.
There are three elements to the management of day-to-day
trading risk:
a. Financial Risk Limitation Policies
The Group has developed proprietary risk management
systems that incorporate various real-time financial risk
limits.
Assessing and managing our risks
The Group maintains a robust, customer-centric approach to
the management and control of risks, which is fully embedded
within the Group’s technology and its day-to-day operating
procedures.
Furthermore, the Group has a comprehensive risk mitigation
plan, which helps to control exposures and provide robust
solutions. This plan includes a range of measures, such as,
corporate policies, operating rules, systematic reporting,
external audits, internal audits, self-assessment and
continuous monitoring by the Regulatory & Risk Committee,
the Board and the executive management.
Risk governance framework
The financial, market and regulatory environments in which
Plus500 operates inherently expose it to a number of strategic,
financial, operational, regulatory and ESG-related risks. The
Group recognises the importance of understanding and
managing these risks and has determined levels of risk that it
believes are efficient. Policies and procedures have been
developed within a robust risk management framework that
attempts to minimise various risks, including market risk.
The Group aims to ensure its risk exposures are aligned with its
risk appetite across its product portfolio. This is supported by
real-time monitoring technology which is embedded in the
Group’s platforms. The Group continues to test a more holistic,
automated hedging capability and will provide information
on this approach, if and when it is implemented.
This overall approach aligns the Group’s interests with its
customers, with a particular focus on customer care and
protection and customer experience, helping to deliver a more
stable revenue stream over time, given the consequently
lower level of top line volatility. The Group continues to expect
that revenue contribution from Customer Trading
Performance will be broadly neutral over time.
Plus500 has a low customer concentration and therefore does
not rely on trading activity from a small number of very large
customers – the largest customer in FY 2022 contributed less
than 1% of total Group revenue.
Plus500 monitors trading levels and exposure limits (for
example by customer, instrument and asset class), and credit
risk is limited by having all OTC customers’ accounts pre-
funded. The Group also offers negative balance protection
and a margin close-out policy to all of its OTC customers on a
global basis.
Risk Management Framework
A RIGOROUS RISK FRAMEWORK
41 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
b. Trading Limits
i. Customer limits
Monetary limits are placed on a customer’s:
(a) Exposure to any single instrument;
(b) Aggregate open positions as a whole; and
(c) Aggregate deposit amounts.
Customer limits are determined with reference to,
amongst other things, a customer’s credit score, trading
history, location and other due diligence results.
ii. Group limits
Monetary limits are also placed on the Group’s exposure to
individual instruments. These limits are set according to,
amongst other things, the asset class, the size, the liquidity
and the beta (volatility) of the underlying instrument. In
each case, when these limits are reached on the OTC
trading platform, it automatically ceases to accept trades
from the relevant individual or on the underlying
instrument until exposure levels fall below the relevant
threshold(s) or threshold(s) are reviewed and amended.
c. Hedging
To further manage risk, the Group has a hedging approach
in place, including targeted hedging in certain
circumstances. This approach would, in extremis, mitigate
exposure of the Group as a whole beyond certain thresholds.
Second line of defence
A strong compliance function is in place in all of the Group’s
regulated subsidiaries. The Board continues to develop the
Group’s compliance policies in line with each of the regulatory
environments in which the Group’s product offerings are
available.
Third line of defence
The third line of defence, independent assurance, is provided
by internal audit.
The role of the internal auditor is to examine, among other
things, the Company’s compliance with relevant law and
orderly business procedures. In accordance with the Israeli
Companies Law 5759-1999 (the “Companies Law”), the internal
auditor is appointed by the Board on the recommendation of
the Audit Committee, which also oversees the internal
auditor’s work plan, monitors its activities and assesses its
performance. Pursuant to the Companies Law, the internal
auditor may not be: (1) a person who holds more than 5% of the
Company’s outstanding shares or voting rights; (2) a person
who has the power to appoint a Director or the Chief Executive
Officer of the Company; (3) an officer or Director of the
Company; or (4) a member of the Company’s independent
accounting firm, or anyone on its behalf.
In January 2022, following receipt of recommendation from
the Audit Committee, the Board appointed Kost Forer Gabbay
& Kasierer ("EY Israel"), a member firm of Ernst & Young as the
Company’s internal auditor as of FY 2022, replacing Brightman
Almagor Zohar & Co. (Deloitte Israel), a member firm of Deloitte
Touche Tohmatsu Limited.
Compliance with relevant regulations is also provided by local
advisors in the main territories that the Group operates in, and
advice on the regulatory regime is considered when planning
new licence applications or sourcing acquisitions.
Internal controls
The Board has overall responsibility for the Group’s systems of
internal control and for monitoring their effectiveness.
Although no system of internal control can provide absolute
assurance against material misstatement or loss, the Group’s
systems are designed to provide the Board with reasonable
assurance that issues are identified on a timely basis and
dealt with appropriately.
The Group’s key internal financial control procedures include:
+ A review by the Board of actual results compared with
budget and forecasts;
+ Reviews by the Board of year-end forecasts;
+ The establishment of procedures for acquisitions, capital
expenditure and expenditure incurred in the ordinary course
of business;
+ The appraisal and approval of proposed acquisitions
outside of the ordinary course of business by the Board;
+ The detailed budgeting and monitoring of costs incurred in
the development of new products;
+ A review of day-to-day management controls and test of
operating effectiveness of key controls;
+ An annual review of the internal controls system;
+ A regular review of risk limits, with a view to conducting
targeted hedging to reduce market risk, as and when
appropriate;
+ The reporting to, and review by, the Board on changes in
legislation, regulatory requirements and practices within
the sector, as well as accounting, regulatory and legal
developments pertinent to the Group; and
+ The appointment of experienced and suitably qualified staff
to take responsibility for key business functions to ensure
maintenance of high standards of performance.
Risk assessment and review
The Board confirms that it has completed a robust assessment
of the Company’s principal and emerging risks. The Board
continues to assess emerging risks but has not identified any
emerging risks that were not already captured as principal
risks through the Group’s comprehensive risk assessment
process, carried out in FY 2022, in accordance with Provision 28
of the UK Corporate Governance Code 2018 (the “Code”).
Principal risks are considered those that would threaten its
business model, future performance, solvency or liquidity.
These are outlined below and further details of financial risks
and their management are set out in note 26 to the
Consolidated Financial Statements.
The comprehensive risk assessment process identified certain
risks which were narrowed down into major risks monitored by
the executive management and the Regulatory & Risk
Committee, then further consolidated into ten principal risks
closely monitored by the Board. The annual and on-going
elements of the Group’s risk management processes are
controlled by an established risk identification, assessment
and monitoring process.
Throughout FY 2022 and up to the date of this Annual Report,
the Board has reviewed the effectiveness of the Group’s
internal controls system. As a result of this review, the Board
considers that the measures that have been, or are, planned
to be implemented, complement the Group’s risk
management framework and are appropriate to the Group’s
circumstances. The measures cover all controls, including
financial and operational controls and compliance with
relevant laws and regulations.
Risk Management Framework continued
42 Plus500 Ltd. Annual Report 2022
RISK DESCRIPTION MANAGEMENT AND MITIGATION
Legal and
jurisdictional risk
The risk that changes in the legal
and regulatory frameworks in
which the Group currently operates
could adversely affect its
performance
+ Diversification of jurisdictions in which the Group’s product
offerings are available
+ On-going monitoring of legal and regulatory
developments and taking necessary actions to remain in
compliance
Regulatory risk
Regulatory changes could result in
one or more of the Group’s product
offerings becoming less profitable,
restrictions on the products
marketing, or a ban on the product
offerings in one or more of the
jurisdictions in which the Group
operates
+ On-going monitoring of market and regulatory sentiment,
developments and advice from compliance functions on
actual and possible future changes and taking remedial
action
+ Maintaining an open and robust dialogue with regulators
+ Continuing to make efforts and investment to diversify the
Group’s product portfolio and broaden its geographic
footprint
Customer care and
protection risk
The risk that a lack of customer
care and protection could
negatively impact customer
welfare, particularly in relation to
compliance with relevant
regulations on these issues
+ Continued efforts to educate and inform customers of the
inherent potential risks involved in trading, through
required risk disclosures, educational features and by
offering an unlimited and free demo account for OTC and
‘TradeSniper’ customers
+ Negative balance protection has been an on-going
feature of the Plus500 OTC platform since inception. This
guarantees that maximum losses of all customers are
limited to the amount of their deposits
+ Other risk management features, including margin close-
out policy, are also embedded within Plus500’s technology
+ Launch of Trading Academy to educate and inform
customers
+ Assessment of potential customers prior to and during the
completion of the on-boarding process
Business risk
The risk of a commercially adverse
impact on the business resulting
from:
+ The Group’s strategic decision-
making failing to seize business
opportunities or react to
changes in the market. This risk
may result in damage or loss,
financial or otherwise, to the
Group as a whole
+ The risk that a third-party
organisation on which the Group
relies significantly will
inadequately provide or fail to
deliver its outsourced activities
or contractual obligations to the
standard required
+ Robust governance, challenge and oversight
+ Managing the Group in line with the agreed strategy,
policies and risk appetite and periodic reviews of such
assumptions compared to developments in the markets,
business and regulation
+ Developing redundancies for material services provided
by third parties by having secondary providers and alert
systems, as well as automated processes to operate
redundancies
+ Due diligence performed on service providers
+ Service level agreements in place and regular monitoring
of performance
+ Input from best-in-class advisors involved in decision-
making processes of strategic developments and
initiatives
BUSINESS AND STRATEGIC RISKS
FINANCIAL RISKS
43 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
Risk Management Framework continued
RISK DESCRIPTION MANAGEMENT AND MITIGATION
Market risk
The risk of exposure to the market.
Market risk is mainly comprised of
the following factors:
+ Price movements
+ Foreign currency exposures
+ The Group manages market risk by steering/balancing
natural hedge and the Group risk tolerance. Market risk is
mitigated by:
+ The Group’s proprietary technology platforms which
enable real-time position monitoring and alerts to help
the Group to constantly manage market exposure and
adjust its controls
+ Defining daily/weekly/monthly Group market risk limits
for each financial market or instrument
+ If predetermined limits are exceeded, the Group takes
appropriate actions to reduce exposure
+ Targeted hedging is conducted on a limited basis, as
appropriate
Credit risk
The risk of clients or counterparties
failing to fulfil contractual
obligations and/or settlements
resulting in financial loss,
specifically:
Client credit risk:
Leveraged trading in the OTC
business can result in client trading
losses exceeding available funds
in their account (mainly due to
sharp market movements); such
losses are absorbed by the Group
(negative balance protection has
always been offered to all the
Group’s OTC customers, in all
markets and across all underlying
assets)
Institutional credit risk:
The risk that financial
counterparties will not meet their
obligations, risking both client and
Group assets
Client Credit Risk:
The Group has a “no-credit” policy in which OTC customers
can only fund their accounts from their own resources, with
all accounts being pre-funded. OTC customers can set a
wide range of loss risk mitigation tools such as alerts and
stops features
Institutional Credit Risk:
The Group engages only with prominent, high ranked and
well-established financial institutions for the holding of its
own assets and in order to meet its regulatory obligations to
safeguard client money in segregated accounts. The Group
periodically reviews its engagements with such financial
institutions to make sure they continue to operate within the
applicable standards and also diversify the Group’s assets
across those financial institutions to reduce risk
Liquidity risk
The risk that there is insufficient
available liquidity to meet the
financial liabilities of the Group
The Group utilises liquidity forecasts to identify potential risks.
These forecasts incorporate the impact of all applicable
liquidity regulations in force in each jurisdiction and other
hindrances to the free movement of liquidity around the
Group. Key issues affecting the Group’s liquidity are discussed
with the Board
Operational risk
The risk of enduring losses resulting
from inadequate or failed internal
processes due to people, failed
technology deployment, adoption
and innovation, external events
(such as natural disasters, major
utilities or infrastructure failure
etc.), or the inability to attract and
maintain competent staff which
the Group requires for operational
purposes
+ Business and regulatory sign-off of processes and
procedures to ensure business efficiency and regulatory
compliance
+ Invest in system development to improve process
automation
+ Monitoring, quality checks and robust analysis of
performance to identify errors, inefficiencies, underlying
causes and mitigation plans
+ Centralised operations – to enable rapid implementation
of business innovation, adjustments to business and
regulatory changes, monitoring and maintaining high
standards, and cost-efficient structure
+ Centralised technical operations, to ensure Group-wide
monitoring, issue handling and analysis
FINANCIAL RISKS continued
OPERATIONAL RISKS
44 Plus500 Ltd. Annual Report 2022
RISK DESCRIPTION MANAGEMENT AND MITIGATION
+ Unified IT strategy focused on performance and growth
+ Continuous development efforts towards operational risk
framework to ensure risk recognition and timely control
+ Recruitment of highly competent employees and
developed employee retention programmes, with
enhanced staff training and oversight
+ Additional support through Google Cloud services,
providing further flexibility, security and scale to our
platforms
+ The Group has a clear business continuity plan, ensuring
quick recovery and cover for both IT and operational
aspects (connectivity, Distributed DoS Attacks,
unresponsiveness of server etc., as well as external events
have an emergency plan and contacts in place)
Information and
data security risk
The risk of loss of technology
services caused by network
disruption and loss of systems,
data and failure to restore services
of a third party in a timely manner
resulting in the Group’s inability to
offer its services
The risk of loss or misuse of
individuals’ personal information
provided to the Group
+ Operate multi-layered delivery, security and mitigation
solution
+ Continuous investment in increased functionality,
scalability, capacity and responsiveness of systems to
monitor, react and prevent cyber attacks
+ Continuous real-time monitoring of incoming and
outgoing network activity
+ Constant monitoring of systems performance and controls
+ Selective software design methodologies and testing
regimes
+ A robust Group IT policy sets out strategic, stability, security
and performance standards as well as backup processes
to enable service availability in the event of failures
+ Privacy as culture – creating awareness among employees
of privacy-related matters including proper use of
personal information, protection of such information and
loss prevention
+ Dedicated cyber security training for all global employees
and the Board
+ Robust privacy oriented compliance programme to ensure
compliance with relevant data privacy regulations
Climate-related risk
Complete or partial prevention of
maintaining the Group’s on-going
operations and the provisions of
services to its customers (e.g., due
to office premises unavailability,
systems connectivity downtime,
datacentre disaster, etc.) as a
result of a natural disaster (e.g.,
earthquake, flood), fire or any other
external factors
+ Plus500 has a Disaster Recovery site supported by a
database which is updated in real time
+ The Group’s headquarters are equipped with an
emergency generator that would be automatically
activated in the event of a power outage and has facility
uninterruptable power supply units that would be
automatically activated if the emergency generator fails
+ “Work From Home” mode – all employees are assigned with
equipment and connectivity, so that there will not be any
interruptions to working activity in the event of office
unavailability
OPERATIONAL RISKS continued
45 Plus500 Ltd. Annual Report 2022
Governance Financial statementsStrategic report
The budgeting process also covers liquidity and capital
planning and, in addition to the granular budget, a three-
year outlook is prepared using assumptions on industry
growth, the effects of regulatory changes, revenue growth
from strategic initiatives and cost growth required to
support initiatives. The budget was reviewed by the Board in
October 2022 and in December 2022 and received final
approval in December 2022.
+ On-going review and monitoring of risks: these are outlined
in the Group’s principal risks and uncertainties on pages 43
to 45 of this report and are monitored monthly by
management, with review and challenge from the
Regulatory & Risk Committee. Based on the various
scenarios tested, the Company has sufficient liquidity and
headroom to operate its business.
Viability
Scenario stress testing of available liquidity and capital
adequacy are central to understanding the Group’s viability.
This testing replicates adverse market conditions and
regulatory change, and is therefore considered in the Group’s
Individual Capital Adequacy Assessment Process and
Individual Liquidity Adequacy Assessment documents, which
are shared with our regulators on request. The results of the
scenario stress testing showed that, due to the robust nature
of the business, the Group would be able to withstand these
scenarios, both in isolation and combined scenarios, over the
financial planning period by taking management actions that
have been identified.
The Board has considered that three years is an appropriate
period over which to provide a viability statement, as this is the
longest period over which the Board reviews the success of
strategic opportunities. This timeline is also aligned with the
period over which internal stress testing occurs. The Board has
no reason to believe that the Group will not be viable over a
longer period, but given the uncertainty involved, in particular
of regulatory changes, the Board believes this period presents
the readers of the Annual Report with a reasonable degree of
confidence.
The Group also monitors performance against predefined
budget expectations and risk indicators, along with strategic
progress updates, allowing management action to be taken
where required, including the assessment of new
opportunities.
Going Concern
Having given due consideration to the nature of the Group’s
business, the Group’s budget, liquidity resources and cash
flow forecasts for the period of three years ending 31 December
2025, taking into account the Group’s anticipated investment
commitments and working capital requirements, the Board
considers that the Company and the Group as a whole are a
going concern and the Consolidated Financial Statements
are prepared on that basis.
This treatment reflects the reasonable expectation that the
Group has adequate resources to continue in business for
over a period of at least 12 months from the date of approval of
the Consolidated Financial Statements and the consideration
of the various risks set out on pages 43 to 45 and the financial
risks described in note 26 to the Consolidated Financial
Statements.
Viability Statement
In accordance with Provision 31 of the Code, the Board has
considered the Group’s current financial position and future
prospects, its strategy, risk appetite and the potential impact
of the principal risks and how these are managed and has a
reasonable expectation that the Group will be able to continue
in operation and meet its liabilities as they fall due over the
three-year assessment ending 31 December 2025.
The Directors confirm that they have performed a robust
assessment of the principal risks facing the Group as detailed
on pages 43 to 45 including those that will threaten its business
model, future performance and liquidity.
In reaching this conclusion, both the prospects and viability
considerations have been assessed:
Prospects
+ The Group’s current financial position is outlined in the
Strategic Report.
+ The Group’s business model: despite regulatory changes in
a number of jurisdictions, the core of the current strategy
remains in place and continues to demonstrate sufficient
cash generation to support operations. In addition, we
believe the Group will continue to be viable beyond the three
years as mentioned above, in accordance with our business
model.
+ Assessment of prospects and assumptions: conservative
expectations of future business prospects through delivery
of the Group strategy as presented to the Board through the
budget approval process. The annual budget approval
process consists of a detailed bottom-up process with a
twelve month outlook which involves input from all relevant
functional and regional heads. The process includes a
collection of resource assumptions required to deliver the
Group strategy and associated revenue impacts with
consideration of key risks. This is used in conjunction with
external assumptions such as, a region-by-region review of
the regulatory environment and incorporation of any
anticipated regulatory changes as outlined in the Strategic
Report, to revenue modelling, market volatility, interest rates
and industry growth which materially impact the business.
The budget is used to set targets across the Group.
Going Concern and Viability Statement
GOING CONCERN AND
VIABILITY STATEMENT
46 Plus500 Ltd. Annual Report 2022
Contents
GOVERNANCE
Governance at a Glance 48
Chair’s Introduction to Governance 50
UK Corporate Governance Code
Compliance Statement
51
Board of Directors 52
Governance Report 56
Shareholder Engagement 61
Report of the Nomination Committee 62
Report of the Audit Committee 66
Report of the Regulatory & Risk
Committee
73
Report of the ESG Committee 76
Report of the Remuneration
Committee
79
Directors’ Remuneration Report 85
Directors’ Report 95
Corporate Law 97
Directors’ Responsibility Statement 99
47 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Governance at a Glance
GOVERNANCE
IN NUMBERS
8
Board members
In numbers
50%
Female representation on the Board
6
Board Committees:
Audit, Remuneration, Nomination, ESG, Regulatory &
Risk and Disclosure
Board gender diversity
as of the date of this
Annual Report
Board independence
as of the date of this
Annual Report
Board tenure
as of the date of this
Annual Report
Ethnicity
as of the date of this
Annual Report
54
48
Key activities of the Board in 2022
+ Strategic discussions relating to developing the
Group’s position in the US futures market, in line with
the Group strategy to evolve into a multi-asset fintech
group and expand the Group’s geographic footprint
and product offering.
+ Review, discussions and approval of trading updates
and results announcements.
+ Conduct of an independent third-party effectiveness
evaluation of the Board and its Audit Committee.
+ Review of monthly updates including CEO and CFO
reviews, financial performance and business
development updates and risk and regulatory
compliance reports.
+ Monitoring and reviewing the Group’s culture, values
and performance, through regular discussions with
the Executive Directors, senior management and their
teams and through the workforce engagement
representative on the Board who held round table
sessions with employees.
Read more about key activities of the Board on page 56
44
Female
Male
6
2
Independent
Non-Independent
6
1
1
3-6 years
6+ years
0-3 years
6
2
Ethnically diverse
White
Corporate governance remained a key priority
area for the Group. During the last two years, we
have strengthened our governance framework and
continued to diversify our Board. These efforts have
ensured Plus500 has a solid governance foundation
from which to deliver on its strategic roadmap
and drive further value for our shareholders going
forward.
48 Plus500 Ltd. Annual Report 2022
Board attendance
The Board met on eleven
occasions in 2022 to review,
formulate and approve the
Group’s strategy, budgets
and corporate actions and to
oversee the Group’s progress
towards its goals. The Board
also holds regular conference
calls to update the members on
operational, financial and other
business matters.
Board training
and development
All Board members are given
updates, on a regular basis, on
changes and developments in
the business and the environment
in which the Group operates,
in order to further develop the
Board’s understanding and
awareness of the business and its
future prospects.
During the year, Board members
attended training sessions
on various areas including
accounting and UK reporting,
M&A, GDPR, prevention of
corruption and bribery, Plus500
trading platforms and products,
ESG and UK regulation.
In line with Plus500’s development
as a global
multi-asset fintech
group, and in order to
appropriately govern and
manage the business as it seeks
to achieve significant future
growth, a further comprehensive
Board training plan was adopted,
to be initiated in 2023.
Board changes
Prof. Varda Liberman
(Independent Non-Executive
Director) was appointed in March
2022.
Daniel King (Independent Non-
Executive Director) stepped down
in June 2022, after completing his
maximum nine-year tenure.
Board skills and experience
Number of Board members with the relevant skills and experience
Audit and risk management
8
Capital raising, mergers, acquisitions, investment and transactions
5
Compliance and regulation
8
Digital technology
4
ESG
6
7
Finance, banking, financial services and fund management
3
Marketing
4
Shareholder relations
7
Innovation
6
Enterprise risk management
Nomination Committee Report page 62 Read more on page 60
49 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Dear shareholder
In my second year as Chair of Plus500, and after continuing to
review and assess all aspects of our business, including
corporate governance, as well as our activities in the area of
sustainability, I would like to take this opportunity to give you an
overview of the work of the Board during 2022.
Corporate governance remained a key focus area for the
Board during the year, as well as our activities in the area of
sustainability. This year we have managed to further diversify
the composition of the Board, in line with the Code and the
recommendations of the FTSE Women Leaders Review and the
new Listing Rules on gender equality in leadership positions. I
am delighted that, as announced on 18 March 2022, Prof. Varda
Liberman has been appointed as an Independent Non-
Executive Director. I would like to take this opportunity to
welcome Prof. Liberman once again to our Board, and I am
certain that this appointment will further expand the skill set of
our Board.
In June 2022, our long-serving Independent Non-Executive
Director and External Director, Daniel King, completed his
maximum nine-year term under the provisions of the Companies
Law and consequently stepped down from the Board.
I would also like to take the opportunity to thank Daniel, who
has been with Plus500 since its IPO in 2013, whose expertise
working with technology businesses, many of which are based
in Israel, has been invaluable in helping to navigate the Board
and the business through various challenges and to help
optimise the opportunities that have arisen during his tenure.
In addition, his leadership, contribution and commitment as
Chair of the Remuneration and ESG Committees have been
extremely appreciated. We wish Daniel all the best.
In 2022, we dedicated considerable time to evaluating the
effectiveness of the work of our Board and its Audit Committee,
and undertook an independent third-party review by Nasdaq
Governance Solutions, in accordance with Provision 21 of the
Code, which requires FTSE 350 companies to have an
externally facilitated board evaluation at least once every
three years. The evaluation process included personal
questionnaires, one-on-one follow up interviews with Board
members and the Company Secretary, alongside Board
meeting observance. A detailed report on the results was
presented to the Board in December 2022. This was a valuable
exercise which resulted in a number of important
recommendations which will be implemented during the
course of 2023. In parallel, we have continued to implement
the feedback and insights derived from our 2021 internal Board
evaluation.
During the year, I met with a number of our major shareholders
to ask for feedback on the Company’s approach to
governance, its strategic priorities and its operational and
financial performance. In addition, I participated in the
Company’s Capital Markets Day, held in September 2022, with
key members of our senior management team. Shareholder
engagement is extremely important and I will continue to
meet regularly with key investors, as will other of our Board
members, to ensure we keep representing investors’ interests.
As detailed below, and as detailed further in the independent
reports by each of our Board Committees’ chairs, our
Committees have continued to assist the Board with reviewing,
monitoring and promoting high standards of corporate
governance. Also, during 2022 and Q1 2023 we approved
several rotations to the Committees’ compositions, including
rotations of some chair roles, following changes made to the
composition of the Board as a whole, as mentioned above.
The Nomination Committee, chaired by Steve Baldwin,
continues to review the skills that we need while always
considering diversity and the need for independent thinking
and challenge.
Chair’s Introduction to Governance
CHAIR’S INTRODUCTION
TO GOVERNANCE
Corporate governance
remained a key focus area for
the Board during the year, as
well as our activities in the area
of sustainability
Prof. Jacob A. Frenkel
Chair of the Board
50 Plus500 Ltd. Annual Report 2022
The Committee will also continue to review the size of the
Board to confirm that it is appropriate and has a good mix of
skills, experience and knowledge and the ability to maintain
appropriate oversight of the executive team and provide
constructive challenge and support. During 2022, significant
effort by the Nomination Committee ensured a further
diversification of the composition of the Board, with the
appointment of Prof. Varda Liberman as an additional Non-
Executive Director, following the appointments of Ms. Tami
Gottlieb and Ms. Sigalia Heifetz as Non-Executive Directors in
2021. As a result, the Board has 50% female representation as of
the date of this Annual Report. The Committee also discussed
and considered ethnic diversity and concluded that the Board
is sufficiently diverse also from that perspective, given the
mixed ethnic background of two of our Board members.
Our oversight of principal and emerging risks including
business, strategic, financial and operational challenges
facing the Group continues. The Regulatory & Risk Committee,
led by its recently appointed chair, Prof. Varda Liberman,
reviews these risks and receives assurance from management
and the Group’s various advisors as to how they are
understood and mitigated to the level of risk acceptable to the
Board. In 2022, the Committee has monitored upcoming
regulatory changes that have arisen during the year.
The Audit Committee, led by its chair, Tami Gottlieb, continues
its work overseeing the internal controls of the business, the
internal audit plan and its implementation, as well as approvals
of certain transactions as required under the Companies Law.
During 2022, significant effort by the Audit Committee took
place in the process to replace the Company’s internal
auditors with more tech-oriented, internal auditors, who are
familiar with the Group’s business and operations, as the Group
continues to expand its product offerings and geographic
footprint. It also works closely with our external auditors and
oversees the production of the Consolidated Financial
Statements. The Audit Committee also went through an
independent third-party evaluation of its effectiveness.
Also in 2022 the Board has continued to develop and strengthen
Plus500’s ESG framework, alongside its ESG Committee, to
assess the Group’s priorities and risks in the area of ESG.
Chaired by its new chair, Steve Baldwin, who replaced Daniel
King in the second half of 2022, and supported by our ESG
internal working group, alongside external ESG advisors, the
Committee updated its Environmental Policy, supported by an
extensive gap analysis, to help us become aligned with the
Task Force on Climate-Related Financial Disclosures (“TCFD”)
recommendations. Further details can be found in our ESG
Report and in the Report of the ESG Committee.
The Remuneration Committee, led by its new chair, Anne Grim,
who replaced Daniel King in the second half of 2022, continues
to monitor all areas of remuneration, including Non-Executive
Directors’ remuneration and Executive Directors’ remuneration,
and ensured continued alignment with the Company’s
approved Remuneration Policy for Directors and Executives, as
further detailed in the Remuneration Committee Report.
The following Governance Report describes the activities of
the Board and its Committees during 2022 in more detail.
The Board has operated very efficiently during 2022. Given
that our Board is extremely diverse, and its members are
based in various international locations, the vast majority of
Board meetings were held as hybrid sessions (which is a
mixture of in-person and virtual attendance), with some Board
and Committee meetings being held on a full in-person basis
in Israel. The Board held a number of meetings during the year
to assess the Group’s strategy and its progress against this
strategy, as well as reviewing key operational elements of the
business. The Board remains very supportive of executive
management in developing the Group’s strategic position as
a global multi-asset fintech group, through a clear focus on
delivering growth, supported also by organic investments and
targeted acquisitions. This strategy is key to the Group’s future
success and has continued to drive the diversification of the
Group’s revenue streams, product range, geographic footprint
and enabled the Group’s reinforced financial position. This is
evident in the significant progress made in 2022 in the US
futures market, in the significant advances in a number of key
areas of product development and in the continued
enhancement of the Group’s geographic footprint and
marketing approach.
Finally, and on behalf of the Board, I would like to reiterate our
deep gratitude to all of our management and talented
employees across our operations worldwide, for their
dedicated work and excellent contribution to the Group’s
culture, performance and great achievements during the year.
I look forward to reporting on the Board’s further progress in
next year’s Annual Report.
Prof. Jacob A. Frenkel
Chair of the Board
22 March 2023
UK Corporate Governance Code Compliance Statement
As a Main Market listed company, and with respect to 2022,
Plus500 is required to comply with the principles and
provisions of the UK Corporate Governance Code 2018 (the
“Code”) (a copy of which can be found on the website of
the Financial Reporting Council: www.frc.org.uk), or
otherwise explain its reasons for non-compliance.
The following statement is therefore made in respect of
the year ended 31 December 2022 in compliance with this
requirement. The following sections of this report explain
how the principles of the Code were applied and provide
cross-references to other sections of the report and/or the
Company’s website (www.plus500.com) where more
detailed descriptions are available.
As a company incorporated in Israel, Plus500 is subject to
mandatory corporate governance requirements under
the Companies Law. Accordingly, there are areas where
Plus500 could not comply with the provisions of the Code
which may be in contradiction to the Companies Law’s
provisions, that must prevail.
For the financial year ended 31 December 2022, the
Company has complied with the provisions of the Code,
other than in respect of the directors’ re-election
mechanism (Provision 18 of the Code) and in relation to
pay ratios and pay gaps (Provision 41 of the Code). While
the Code recommends the submission of all directors for
re-election annually, the Companies Law requires that a
public company must have at least two External Directors
who meet certain statutory requirements of
independence. The Company’s External Directors as of
the date of this Annual Report are Anne Grim and Tami
Gottlieb. The External Directors, as prescribed by the
mandatory requirements of the Companies Law, must be
elected for three-year terms and not annually as the Code
recommends.
Plus500 is not required to compile gender pay gaps and
pay ratios under the Israeli legislation, whereas companies
incorporated in the United Kingdom are required to do so
under UK legislation.
51 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Board of Directors
Prof. Jacob A. Frenkel
Chair
Tenure: 2 years
(Appointed May 2021)
Prof. Jacob A. Frenkel is a Non-Executive
Director and Chair of the Board.
Prof. Frenkel is a renowned global
economist and illustrious business
leader, with significant experience
developed over many years of
leadership. He is Chairman Emeritus of
the Group of Thirty (G-30), and Chairman
of BrainStorm Cell Therapeutics Inc., a
NASDAQ-listed biotechnology company.
Prof. Frenkel served as Chairman of
JPMorgan Chase International (2009-
2020), Chairman and CEO of the G-30
(2001-2011), Chairman of the Board of
Trustees of the G-30 (2012-2022), Vice
Chairman of American International
Group, Inc. (2004-2009), Chairman of
Merrill Lynch International (2000-2004),
Chairman of the Board of the Inter-
American Development Bank (1995-
1996) and Vice Chairman of the Board of
the European Bank for Reconstruction
and Development (1999-2000). He also
served as Chairman of the Board of
Governors of Tel Aviv University (2013-
2021).
Prior to this he served two terms as the
Governor of the Bank of Israel (1991-2000),
as the Economic Counsellor and Director
of Research at the International
Monetary Fund (1987-1991) having
previously been Professor of Economics
and the David Rockefeller Professor of
International Economics at the University
of Chicago (1973-1987).
He is a Laureate of the Israel Prize in
Economics and is a recipient of several
Honorary Doctoral Degrees and other
decorations and awards. He is an
Honorary Member of the American
Academy of Arts and Sciences, a Fellow
of the Econometric Society, a Fellow of
the International Economic Association,
a Senior Advisor of Temasek International
Advisors, a member of the Competitive
Markets Advisory Council of the CME
Group, a Global Member of the Trilateral
Commission, a former member of the
Economic Advisory Panel of the Federal
Reserve Bank of New York, a member of
the G20 Eminent Persons Group on
Global Financial Governance, and a
member of the G20 High Level
Independent Panel on Financing of the
Global Commons for Pandemic
Preparedness and Response.
Prof. Frenkel holds a BA in economics and
political science from the Hebrew
University of Jerusalem, and an M.A. and
Ph.D. in economics from the University of
Chicago.
BOARD OF
DIRECTORS
As at the date of this Annual Report
Prof. Jacob A. Frenkel
The role of the Board
The Board is responsible to
shareholders for effective direction
and control of the Company, for
promoting its long-term success
and determining the Group’s
strategy, vision and culture. In order
to lead the development of the
Company’s strategy, the Board is
provided with timely and
comprehensive information that
enables it to effectively review and
monitor the performance of the
Company and to ensure it is in line
with its objectives for achieving its
strategic goals.
Committee
Membership Key:
Nomination
Audit
Regulatory & Risk
Remuneration
ESG
Disclosure
Chair of the Committee
52 Plus500 Ltd. Annual Report 2022
David Zruia
Chief Executive Officer and Director
Tenure: 3 years
(Appointed April 2020)
David Zruia is the Chief Executive Officer.
David joined Plus500’s leadership team
in 2010 as a senior manager in the
Group’s marketing department. In that
role, David was instrumental in
establishing Plus500’s technology-
based marketing capabilities and in
building awareness of, and recognition
for, the Plus500 brand in key strategic
markets around the world, through a
broad range of marketing initiatives and
activities.
He was appointed as the Group Chief
Operations Officer in 2013 and led the
establishment and management of the
operational division of the Group,
including the implementation and
development of ‘KYC’ processes,
payments processing, back-office
services, customer support and risk
management.
In April 2020, David was appointed as
Chief Executive Officer of Plus500. Since
that time, under his leadership, Plus500
has developed a new strategic
roadmap, which has been designed to
diversify and grow the business as a
global multi-asset fintech group. As part
of the new strategic roadmap, Plus500
has conducted its first ever acquisitions,
in the US and Japan, thereby expanding
the Group’s global footprint, broadening
its product range and enabling access
to a number of significant future growth
opportunities for Plus500.
David holds a B.Sc. in Industrial
Engineering and Management from the
Technion – Israel Institute of Technology.
Elad Even-Chen
Group Chief Financial Officer and Director
Tenure: 7 years
(Appointed June 2016)
Elad Even-Chen is the Chief Financial
Officer of the Group and Vice President of
Business Development.
Elad joined the Group in 2011 and his
responsibilities cover a broad range of
finance, business, corporate and strategic
functions.
Elad established the business development
department which he is leading and
managing. The business development
department is responsible for the Group’s
strategic investments and expansion plans
into new and existing markets, through
receipt of new regulatory licences across
the globe, including by targeting and
executing acquisitions.
Elad has played a key role in driving the
Group’s strategic and financial performance
and its business expansion in recent years,
into new markets and new product areas.
Elad leads the Group’s financial divisions and
also oversees the financial performance,
including treasury, consolidated financial
statements and tax matters.
Elad has an extensive corporate finance,
legal and regulatory background. Over the
last 12 years he has held a number of
positions within the Group also acting as
Company Secretary, Head of Risk
Management and Head of IR.
Elad is a certified accountant in Israel and,
prior to joining the Group, was a senior
associate at KPMG.
Elad holds a BA in Accounting and
Economics from Tel Aviv University, an LL.B
from the College of Management and an
MBA (specialising in Financial Management)
from Tel Aviv University.
David Zruia Elad Even-Chen
Changes to the Board during 2022
+ Prof. Varda Liberman joined the
Board on 18 March 2022.
+ Daniel King stepped down
from the Board on 19 June 2022
(after completing his maximum
nine-year tenure).
53 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Board of Directors continued
Committee
Membership Key:
Nomination
Audit
Regulatory & Risk
Remuneration
ESG
Disclosure
Chair of the Committee
Anne Grim
Senior Independent Non-Executive
Director and External Director
Tenure: 2.5 years
(Appointed September 2020)
Anne Grim is a Non-Executive Director,
the Senior Independent Director and
Chair of the Remuneration Committee.
Anne is an experienced executive turned
advisor, consultant and board member
with more than 30 years in senior
financial services leadership roles at
Barclays, Wells Fargo, American Express,
Mastercard and most recently as Chief
Customer Officer at Fidelity International,
prior to embarking on her Board portfolio
career. Her expertise is in customer
experience, strategic planning and
execution, technology innovation and
business transformation.
Anne is an independent non-executive
board member for Insight Investment,
where she chairs Insight Investment
Fund Management Ltd and the Insight
Investment Strategic Technology
Committee; Metro Bank PLC; and
Openwork Holdings Ltd. where she chairs
the Risk and Compliance Committee.
Anne holds a BA in Mathematics and
Computer Science and an MBA in
Strategic Management and Finance,
both from the University of Illinois.
Steve Baldwin
Independent Non-Executive Director
Tenure: 6 years
(Appointed June 2017)
Steve Baldwin is a Non-Executive Director
and Chair of the Nomination and ESG
Committees.
Steve is currently the Chair of TruFin plc
and is also a Non-Executive Director of
The Edinburgh Investment Trust PLC.
Steve has an extensive corporate
finance background and held the
position of Head of European Equity
Capital Markets and Corporate Broking
at Macquarie Capital until 2015 when he
decided to pursue a non-executive
career.
Prior to joining Macquarie Capital, Steve
was a Corporate Finance Director at JP
Morgan Cazenove for ten years and
previously a Vice President of Corporate
Finance at UBS.
Steve qualified as a Chartered
Accountant at Coopers & Lybrand after
graduating with a BA in Zoology from St
Catherine’s College, Oxford University.
Anne Grim Steve Baldwin
54 Plus500 Ltd. Annual Report 2022
Tami Gottlieb
Independent Non-Executive Director
and External Director
Tenure: 2 years
(Appointed March 2021)
Tami Gottlieb is a Non-Executive Director
and Chair of the Audit Committee.
Tami has a long track record in the
financial services industry in Israel and is
currently an External Director at Bank
Leumi Le-Israel – one of Israel’s two
largest commercial banks, where she is
the Chair of the Audit and Financial
Reports Committees and a member of
the Remuneration and Business & Credit
& Resources Committees, having
previously been on the Technology
Committee and on the Risk Management
Committee.
Tami Gottlieb is also an Independent
Director at Novolog (Pharm-Up 1966) Ltd,
an External Director at Extell Limited and
a Director at Emilia Development (O.F.G)
Ltd. She is also a founder and Co-
Managing Director of Harvest Capital
Markets Ltd, a wealth management and
corporate finance boutique firm.
Tami holds a BA in International Relations
from the Hebrew University of Jerusalem
and an MA in Economics from Indiana
University.
Sigalia Heifetz
Independent Non-Executive Director
Tenure: 2 years
(Appointed February 2021)
Sigalia Heifetz is a Non-Executive
Director.
Sigalia holds non-executive
directorships at a number of leading
Israel-based corporations across a
range of sectors and industries,
including Nesher Israel Cement
Enterprises Ltd, Clal Biotechnology
Industries Ltd, RHI Magnesita N.V, Maman
Cargo Terminals and Handling Ltd,
Tamar Petroleum Ltd, Mashav Initiating &
Development Ltd and Vesta Investments
and Management Ltd.
She also previously held non-executive
positions at Bet Shemesh Engines Ltd
and Hadera Paper, prior to which she
was an audit partner at accountancy
firm BDO. She also served as a non-
executive director at Golf & Co Ltd.
Sigalia holds a BA in Accounting and
Economics from Tel Aviv University and
an Executive MBA from INSEAD and
Tsinghua University.
Prof. Varda LibermanTami Gotlieb Sigalia Heifetz
Prof. Varda Liberman
Independent Non-Executive Director
Tenure: 1 year
(Appointed March 2022)
Prof. Varda Liberman is a Non-Executive
Director and Chair of the Regulatory &
Risk Committee.
Prof. Liberman is an internationally
renowned expert in the field of decision-
making and behavioural economics. In
this capacity, she provides consulting
and workshops in key elements of
managerial decision-making and risk
management to senior managements
in organisations across a range of
sectors, including healthcare, banking,
investment, technology, the judicial
system and the Israeli Defence Forces.
Prof. Liberman is the Rector of Reichman
University (IDC Herzliya) in Israel, and one
of its founders and leaders. She is a
professor of the business school of
Reichman University, a visiting
researcher at Stanford University, and
the author of several books and many
scientific articles. Over the years, she has
held a variety of managerial positions at
the Reichman University, among them
heading the mathematics and statistics
studies, leading the decision-making
area in the business school, and
founding and heading the MBA
programme in Healthcare Innovation.
Prof. Liberman holds a B.Sc. in
Mathematics and Statistics, an M.Sc. in
Mathematics and a Ph.D. in Mathematics,
all from Tel Aviv University.
55 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
The Board
The Board maintains full control and direction over appropriate
strategic, financial, organisational and compliance issues.
The Company’s organisational structure has clearly defined
lines of authority, responsibility and accountability, which are
reviewed regularly. The annual budget and forecasts are
reviewed by the Board prior to their approval. This includes the
identification and assessment of the business risks inherent in
the Group and the online financial trading industry as a whole,
along with associated financial and regulatory risks. At least
annually, and on other occasions as necessary, the
Company’s senior Executives are invited to attend meetings of
the Board in order to present and discuss various matters
relating to their functions and areas of responsibilities.
Board activities during the year
The Board agrees at the end of each year the annual calendar
and forward meeting agenda for the following year, and
additionally meets at such other times as required.
The matters accepted by the Board for consideration at Board
meetings are: business strategy, operational highlights
and current trading, budget and financial performance,
governance, sustainability, organisational culture and risk
and regulation. This is further detailed in the schedule of
matters specifically reserved for decision by the full Board
members, which can be found on the Company’s website:
www.plus500.com.
Board activity in 2022
Strategy
+ During 2022 the Board discussed on-
going actions to be taken to further
develop its strategic roadmap for the
coming years, as set out on pages 10-
11.
+ The Board held strategic discussions
relating to developing Plus500’s
position in the US futures market, in
line with the strategy to evolve into a
multi-asset fintech group and
expanding the Group’s geographic
footprint.
+ The Board approved an acquisition of
a regulated firm in Japan, in line with
its strategy to expand its geographic
footprint.
Business,
operational
highlights and
current trading
The Board received monthly updates
including CEO and CFO reviews,
financial performance and business
development updates and risk and
compliance reports.
Quarterly
forecasts and
budget
Updates were provided and discussed
on a monthly and quarterly basis.
Discussions on the 2023 budget were
held in October and December 2022
with final approval received in
December 2022.
Financial
performance
The Board reviewed and approved the
on-going trading updates and results
announcements. The Board considered
and approved the Consolidated
Financial Statements and the Annual
Report.
People,
governance,
risk and
regulation
The Board received updates and
conducted discussions about
regulatory developments and
emerging risks. It also received training
and briefings on regulation, in addition
to on-going updates on compliance
and risk matters.
Whistleblowing
The Board reviewed and approved the
Group’s Whistleblowing Policy, as it does
on an annual basis, and received an
update by the Whistleblowing
Supervisor that no complaints were
received in 2022.
Culture and
values
The Board continued to monitor and
review the Group’s culture, values and
performance primarily through regular
discussions with the Executive Directors,
senior management and their teams. In
addition, Steve Baldwin, in his role as the
workforce engagement representative
on the Board, held round table sessions
with employees from various
departments of the Company.
Shareholder
returns
The Board approved share buyback
programmes and declared the
payment of dividends during the year,
in line with the Company’s most recent
shareholder returns policy.
Independent
third-party
Board
evaluation
An external effectiveness evaluation of
the Board and the Audit Committee has
been conducted and a discussion was
held to address the recommendations
provided, as further detailed on pages
59-60.
Other
+ Review of monthly reporting decks on
risk and compliance;
+ Receiving on-going updates from
Board Committees’ chairs;
+ Board training sessions on various
topics, including: accounting and UK
reporting, M&A, Plus500 trading
platforms and products, GDPR and
ESG;
+ Annual review and approval of
Human Rights and Modern Slavery
Statement; and
+ Annual review and approval of
Company’s policies and procedures.
GOVERNANCE REPORT
Governance Report
56 Plus500 Ltd. Annual Report 2022
Board Committees
The Board has appointed six principal committees to which
certain aspects of the Board’s work are delegated, in order to
assist the Board in carrying out its responsibilities and as
required under the Companies Law. Each committee has
adopted its own terms of reference, approved by the Board,
and establishes an annual plan. The full terms of reference of
the Board’s committees are available on the Company’s
website. The chair of each committee provides regular
updates to the Board on the matters discussed at the
committee’s meetings and provides the committee’s
recommendations to the Board when required.
A brief description of the main roles of each of the Board
Committees is set out below.
Nomination Committee
The Nomination Committee has been delegated responsibility
for the oversight of appointments to the Board and the senior
management team. The Committee’s responsibilities, main
activities and priorities for the next reporting cycle are set out
on pages 62-65.
Audit Committee
The Audit Committee has been delegated responsibility for
ensuring the financial performance of the Group is properly
reported on and reviewed and the monitoring of the external
auditor, the internal auditor and oversight of internal controls.
The Committee’s responsibilities, main activities and priorities
for the next reporting cycle are set out on pages 66-72.
Regulatory & Risk Committee
The Regulatory & Risk Committee has been delegated
responsibility for the monitoring and oversight of risk
management and mitigation and the approval of risk
appetite. The Committee’s responsibilities, main activities and
priorities for the next reporting cycle are set out on pages 73-
75.
ESG Committee
The ESG Committee has been delegated responsibility for
considering the adequacy of the Group’s ESG policies and
processes. The Committee’s responsibilities, main activities
and priorities for the next reporting cycle are set out on pages
76-78 .
Remuneration Committee
The Remuneration Committee has been delegated
responsibility for determining, within the agreed terms of
reference and in accordance with the Companies Law, the
Group’s policy on the remuneration packages of the
Company’s Chief Executive Officer and Chief Financial Officer,
the Chair and other Non-Executive Directors, the Company
Secretary and other senior Executives and the Company’s
remuneration policy. The Committee’s responsibilities, main
activities and priorities for the next reporting cycle are set out
on pages 79-84.
Disclosure Committee
The Disclosure Committee assists the Board in fulfilling its
obligation to make timely and accurate disclosure of all
information that is required to be disclosed to meet legal and
regulatory requirements and obligations under the UK Market
Abuse Regulations and the Disclosure Guidance and
Transparency Rules of the FCA, including the requirement for
the Company to establish and maintain adequate procedures,
systems and controls to enable it to comply with these
obligations. Whenever necessary, the Committee meets to
discuss the content of announcements proposed to be
released to the London Stock Exchange and approve their
content.
Operation of the Board
The Board is responsible for the effective direction and control
of the Group. The Board is also responsible for the overall
strategy and financial performance of the Group and has a
formal schedule of matters reserved for its approval. The
schedule of matters covers key strategic, financial and
operational matters including:
+ Approval of the Group’s strategic objectives;
+ Approval of the annual operating and capital expenditure
budgets of the Group, and any material changes to them;
+ Changes to the Group’s capital structure, management and
control structure;
+ Contracts which are material, strategically or by reason of
size, entered into by the Company in the ordinary course of
business; and
+ Recommended appointments to the Board.
The Company Secretary, Hila Barak, is responsible for ensuring
that the Company complies with the statutory and regulatory
requirements and maintains high standards of corporate
governance. She supports and works closely with the Chair of
the Board, the Senior Independent Director, the Chief Executive
Officer and the Board Committees, chairs in setting agendas
for meetings of the Board and its committees. She also
supports the transfer of timely and accurate information flow
from and to the Board and the management of the Company.
Hila Barak is a certified lawyer in Israel since 2012 and joined
Plus500 in 2020 after years of experience in corporate and
securities law, being an associate with one of the leading law
firms in Israel. Hila holds an LLB (Magna Cum Laude), BA in
Social Science and an Executive MBA, all from the University of
Haifa. All Board members have access to the advice and
services of the Company Secretary. Both the appointment
and removal of the Company Secretary are a matter for the
Board as a whole.
Board effectiveness
The Board holds its meetings in accordance with its scheduled
calendar. Each Board meeting is preceded by a clear agenda
and any relevant information is provided to the Board members
in advance of the meeting. The Board met on eleven occasions
in 2022 to review, formulate and approve the Group’s strategy,
budgets and corporate actions and to oversee the Group’s
progress towards its strategic goals. The Board also holds
regular conference calls to update the members on operational
and other business matters. A summary of the key activities of
the Board in 2022 is set out on page 56.
Where Board members have concerns, which cannot be
resolved, about the running of the Company or a proposed
action, they may request that their concerns are recorded in
the Board minutes. An agreed procedure exists for Board
members in the furtherance of their duties to take independent
professional advice.
Induction of newly appointed Board members
Whenever there is a necessity to add a new Non-Executive
Director to the Board, the Nomination Committee operates an
orderly procedure for identifying the relevant skills, knowledge
and experience which are required. As part of this process, the
Nomination Committee takes into consideration various
parameters, including the existing skill set on the Board as well
as diversity aspects. Where a potential candidate is identified,
the Nomination Committee recommends the appointment to
the Board. If approved by the Board, it recommends the
appointment to the Company’s shareholders.
57 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Newly appointed Board members are made aware of their
responsibilities through the Company Secretary. The
Company has accordingly implemented an internal induction
plan for newly appointed Board members which provides
them with training sessions via internal meetings,
presentations and discussions. These are conducted by the
Company’s advisors (such as legal advisors), the senior
management and other relevant persons in order to enable
greater awareness and understanding of the Company’s
business and the legal and business environment in which it
operates. Moreover, the induction plan includes provision of
various documents and reports, such as constitutional
documents, organisational chart and Group structure,
previous Board minutes, Group’s policies as well as PR and IR
materials.
Chair of the Board
The Chair of the Board, Prof. Jacob A. Frenkel, is responsible for
leading the Board and ensuring its effectiveness, by setting
the relevant agenda and providing sufficient time for
constructive discussions in which the Board has the ability to
challenge the discussed items. The Chair is responsible for
creating the open and engaging atmosphere that enables
the healthy and constructive discussions of the Board. The
Chair is also responsible for ensuring effective communication
between Executive and Non-Executive Directors, shareholders
and between other major stakeholders and the Board.
Chief Executive Officer
The Chief Executive Officer, David Zruia, acts as the main point
of communication between the Board and management and
is responsible for the day-to-day running of the business and
implementation of strategy.
Chief Financial Officer
The Chief Financial Officer, Elad Even-Chen, is responsible for
covering a broad range of finance, business, corporate and
strategic functions, such as monitoring the operational and
financial results, overseeing liquidity, managing the financial
reporting of the Group and developing the Group’s strategy
into new and existing markets.
Non-Executive Directors
Collectively, the Non-Executive Directors bring a valuable
range of expertise in assisting the Company to achieve its
strategic goals. The effectiveness of the Board benefits from
the following skills, expertise and experience offered by the
current members of the Board: financial services, finance and
accounting, governance and regulatory, research and
development, ESG, risk and regulation, marketing, innovation,
technology and other financial expertise.
Senior Independent Director
The Senior Independent Director, Anne Grim, acts as a
sounding board for the Chair, providing him with support in the
delivery of his objectives and leading the evaluation of the
Chair on behalf of the other Board members. As a Senior
Independent Director, Anne Grim may also take responsibility
for an orderly succession process for the Chair, and is a
member of the Nomination Committee and also serves on
several other Board Committees. She is available to meet with
shareholders if they have concerns which are not being
addressed through the usual channels of the Chair, the Chief
Executives or the Investor Relations team.
Board composition
As of the date of this Annual Report, the Board comprises two
Executive Directors (who constitute 25% of the Board): David
Zruia and Elad Even-Chen, and six Non-Executive Directors
(who constitute 75% of the Board): Prof. Jacob A. Frenkel (Chair
of the Board), Anne Grim (Senior Independent Non-Executive
Director), Steve Baldwin, Sigalia Heifetz, Tami Gottlieb and Prof.
Varda Liberman. Prof. Frenkel was independent on
appointment (and still is), in accordance with the requirements
of the Code.
In accordance with the Companies Law, the Board must have
at least two external directors who meet certain statutory
requirements of independence (the “External Directors”).
Following Daniel King’s completion of his maximum nine-year
tenure in June 2022, the Company’s External Directors are
Anne Grim and Tami Gottlieb. Under the Companies Law, the
term of office of an External Director is three years, which can
be extended for two additional three-year terms. External
Directors are elected by shareholders subject to a special
majority and may be removed from office only in limited
cases. The Board is therefore fully aligned with the provisions
of the Companies Law. In addition, any committee of the Board
to which the Board delegated one or more of its responsibilities
must include at least one External Director and the Audit
Committee and Remuneration Committee must each include
all of the External Directors (including an External Director
serving as the chair of the Audit Committee and Remuneration
Committee). A majority of the members of the Audit
Committee must comply with the Director independence
requirements, while the majority of the members of the
Remuneration Committee must be External Directors and its
other members must be remunerated in the same manner as
the External Directors.
Governance Report continued
58 Plus500 Ltd. Annual Report 2022
Board attendance in FY 2022
Details of the number of scheduled Board meetings and
individual attendance at these meetings are set out in the
Board attendance table below. Where Board members are
unable to attend meetings, for any reason, they are
encouraged to share with the Chair in advance their views on
the agenda items to be discussed at the meetings.
SCHEDULED
MEETINGS
ELIGIBLE TO
ATTEND
SCHEDULED
MEETINGS
ATTENDED
Chair of the Board
Prof. Jacob A. Frenkel 11 11 (100%)
Executive Directors
David Zruia 11 11 (100%)
Elad Even-Chen 11 11 (100%)
Senior Independent Non-Executive, External Director
Anne Grim 11 11 (100%)
Independent Non-Executive, External Director
Tami Gottlieb 11 11 (100%)
Independent Non-Executive
Directors
Steve Baldwin 11 11 (100%)
Sigalia Heifetz 11 8 (72%)
Prof. Varda Liberman
1
8 8 (100%)
Past Independent Non-Executive Director
Daniel King
2
5 5 (100%)
1. Prof. Varda Liberman was appointed on 18 March 2022.
2. Daniel King stepped down from the Board on 19 June 2022.
Election of Board members
Following recommendations from the Nomination Committee
and a review by the Chair of the Board, the Board considers
that all Board members continue to be effective, remain
committed to their roles and have sufficient time available to
perform their duties. Information with respect to their re-
election will be set out in the 2023 Notice of AGM to be
circulated by the Company to all shareholders in due course.
Independence of Non-Executive Directors and time
commitment
Each of the Non-Executive Directors is considered to be
independent of management and is considered by the Board
to be free from any business or other relationships that could
compromise their independence. Their role is to effectively
advise and challenge management, and to monitor
management’s success in delivering the strategy agreed by
the Board. The Chair and the Non-Executive Directors held
discussions and met during the year, without the Executive
Directors’ presence, in order to review and monitor
management performance. Also, during the year, the Non-
Executive Directors, led by the Senior Independent Director,
met twice without the Chair’s presence, in order to, among
other things, evaluate his performance.
Each Board member is aware of the need to allocate sufficient
time to the Company in order to fulfil their responsibilities and
is notified of all scheduled Board and Board Committee
meetings. None of the Non-Executive Directors hold any
directorships in any FTSE 100 company.
Conflicts of interest
The Company has procedures for the disclosure and review of
any conflicts of interest, or potential conflicts of interest, which
may arise in relation to Board members. The Board members
are asked to disclose any conflict of interests at each
scheduled Board meeting and are aware of their
responsibilities to avoid conflict of interests and to disclose
any conflict or potential conflict of interest to the Board. A
Board member who has a personal interest in a matter that is
considered at a meeting of the Board, the Audit Committee or
the Remuneration Committee shall not attend that meeting
(unless the chair of the Board, the Audit Committee or the
Remuneration Committee, as the case may be, determines
that such person’s presence at the meeting is required for
presentation of the relevant transaction) or vote on that
matter, unless a majority of the respective forum has a
personal interest in the matter as well. If a majority of the Board
has a personal interest in the transaction, then shareholders’
approval is also required.
The authorisation of a conflict matter, and the terms of
authorisation, may be reviewed at any time by the Board. The
Board considers that these procedures are operating
effectively. There have been no matters arising requiring
assessment by the Board as a potential conflict during this
year.
Board evaluation
In accordance with Provision 21 of the Code, and as a FTSE 250
company, Plus500 is required to conduct an externally
facilitated evaluation of the Board every three years, with the
previous externally facilitated evaluation taking place in 2019
by Genius Board. Therefore, in 2022, Plus500 engaged Nasdaq
Governance Solutions to facilitate the external evaluation of
the Board and Audit Committee and the final reports (one for
the Board and one for the Audit Committee) were presented
by Nasdaq Governance Solutions at the December 2022
Board meeting.
The evaluation comprised completion of written
questionnaires via a secure digital platform, individual
interviews conducted by Nasdaq Governance Solutions’
experts with Board members and with the Company Secretary
and observance of the October Board and Audit Committee
meetings.
The questionnaires were developed by Nasdaq Governance
Solutions, taking into consideration the findings of the 2019
external evaluation, the findings of the 2020 and 2021 internal
evaluations, and in accordance with the guidance from the
Financial Reporting Council on Board Effectiveness.
Nasdaq Governance Solutions’ experts discussed the
feedback received from the completed questionnaires and
the individual interviews with the Chair of the Board and the
Chair of the Audit Committee, for the respective evaluations.
The final reports on the feedback, comments and suggestions
received were circulated to the Board, and were presented by
Nasdaq Governance Solutions and discussed by the Board
and the Audit Committee, at their meetings held in December
2022.
59 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
The Board evaluation covered various aspects of Board
performance including:
+ Board culture and accountability
+ Board composition and director engagement
+ Strategy and performance oversight
+ Audit, risk and internal controls
+ Board’s relationship to management
+ Board meetings and administration
+ Remuneration, talent management and succession
planning
The findings determined that the Board had higher degrees of
effectiveness, inter alia, in relation to the following:
+ High levels of engagement and a collegiate, collaborative
and professional environment among Board members and
management
+ Oversight of the setting and implementation of strategy
+ The Board Chair is viewed by Board members as a credible,
disciplined and inclusive leader
+ Board administration
+ The Board’s skills, knowledge and experience profile,
supported by strong onboarding and on-going training
initiatives
+ A diligent approach to employee engagement and strategic
HR matters, supported by a designated employee
“champion” on the Board
Opportunities for improved effectiveness were also identified,
alongside some focus areas for 2023 and topics for Board
training and education. To strengthen its effectiveness, the
Board, supported by the Company Secretary, is evaluating the
findings from the external evaluation and with the help of the
actions identified in the report will address and strengthen
different focus areas arising from the external evaluation.
Board training and development
All Board members are given updates, on a regular basis, on
changes and developments in the business and the
environment in which the Group operates, in order to further
develop the Board’s understanding and awareness of the
business and its future prospects.
The Company Secretary and the Company’s advisors provide
updates to the Board on relevant legislative and regulatory
corporate governance-related changes, on an on-going
basis.
During the year, Board members attended training sessions
on various areas including accounting and UK reporting, M&A,
GDPR, prevention of corruption and bribery, Plus500 trading
platforms and products, ESG and UK regulation.
In line with Plus500’s development as a global multi-asset
fintech group, and in order to appropriately govern and
manage the business as it seeks to achieve significant future
growth, a further comprehensive Board training plan was
adopted, to be initiated in 2023.
This training plan was designed and tailored for Plus500 and
the specific commercial dynamics of the business, and was
developed in alignment with the recommendations received
as part of the independent third party evaluation which took
place in 2022.
Ensuring that the Annual Report is fair, balanced and
understandable
In relation to the Annual Report and the Consolidated Financial
Statements for the year ended 31 December 2022, the Board, in
conjunction with the Audit Committee, have sought to ensure
that the Annual Report is fair, balanced and understandable.
The Board considers that, taken as a whole, the Annual Report
is fair, balanced and understandable, and provides the
information necessary for shareholders to assess the
Company’s position, performance, business model and
strategy.
In September 2022, the Company held its first ever Capital
Markets Day with the Chair of the Board and key members of
Plus500’s senior management team.
The Company continues to encourage the engagement of
both institutional and private investors. During the year,
investor meetings were conducted on an in-person basis,
while others were conducted through virtual channels,
including conference calls and video conferences. The Chief
Executive Officer, David Zruia, and Chief Financial Officer, Elad
Even-Chen, met regularly with institutional investors,
particularly with regard to the issuance of half and full year
results. They were accompanied at these meetings by the
Company’s Head of Investor Relations, who manages
Plus500’s relationships and communications with the
investment community. The Chair of the Board also met
regularly with key investors during the year.
Communication with private individuals is maintained
through the Annual General Meeting and any Extraordinary
General Meeting, the Company’s annual and interim reports
and the scheduled, or otherwise required, trading updates.
The Chairs of the Audit, Remuneration, Nomination, Regulatory
& Risk and ESG Committees are available to answer questions
at the Company’s Annual General Meetings. In addition,
further details on the strategy and performance of the
Company can be found on the new Investor Relations website,
which includes copies of the Company’s regulatory news,
financial statements, investor presentations and other reports.
Regular updates are provided to the Board on meetings with
shareholders and analysts, as well as on brokers’ opinions.
Non-Executive Directors are available to meet major
shareholders, as required. Investors are also encouraged
to contact the Company’s Head of Investor Relations at:
ir@Plus500.com.
Governance Report continued
60 Plus500 Ltd. Annual Report 2022
Major interests in shares
As at 21 March 2023, being the latest practicable date before
the approval of this Annual Report, the Company is aware of
the following persons who, directly or indirectly, were interested
in 3% or more of the Company’s capital or voting rights:
FUND MANAGER
NUMBER
OF
SHARES %
Odey Asset Management 7,949,563 8.67
BlackRock Inc 5,688,646 6.20
Schroder Investment Management 5,542,590 6.04
The Vanguard Group, Inc 4,277,506 4.66
2022 Annual General Meeting
The 2022 Annual General Meeting was held on 3 May 2022 as a
hybrid meeting, given that many of the Board members are
based in international locations, and with travel restrictions
still in place in certain geographies at that time. This facilitated
an effective participation by shareholders from various
jurisdictions.
All resolutions proposed at the 2022 AGM were duly passed by
shareholders by means of a poll vote (excluding a non-binding
advisory vote on the Directors’ Remuneration Report).
The Board also noted that two resolutions passed at the 2022
AGM had more than 20% of votes cast against them. These
resolutions related to the re-election of one of the Board’s
Independent Non-Executive Directors and an allotment of
shares to the Chair of the Board. Since the AGM results,
members of the Board have engaged with several
shareholders and shareholder advisory bodies to understand
their perspective on these resolutions, and on the Group’s
overall framework for governance and remuneration. As a
result, the Board believes it understands the rationale
regarding the votes cast against these resolutions and where
appropriate will take these views into consideration in its
approach to these areas in the future.
All the other resolutions which were duly passed at the AGM,
had at least 80% of votes cast in favour, with a number of these
resolutions relating to remuneration increases of the Chair
and the Independent Non-Executive Directors. This
demonstrates shareholders’ overall on-going recognition of
the importance of providing appropriate incentives to attract
and retain high quality individuals to the Board whose
stewardship is helping to drive the value of Plus500’s business
as the Group successfully continues to deliver against its
strategic objectives.
The Board remains fully committed to achieving the highest
governance standards and will continue to engage regularly
with shareholders and to consider their views in its decision-
making.
2023 Annual General Meeting
The Company’s 2023 Annual General Meeting is scheduled to
be held at 10.00am UK time on 2 May 2023 at Liberum Capital
Limited, Level 12, Ropemaker Place, 25 Ropemaker Street,
London EC2Y 9LY UK.
Details of all resolutions to be proposed at the 2023 Annual
General Meeting will be included in the Notice of the 2023
Annual General Meeting to be circulated by the Company to
all shareholders in due course.
SHAREHOLDER
ENGAGEMENT
Shareholder Engagement
61 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Dear shareholder
As the Chair of the Nomination Committee, I am pleased to
have this opportunity to give you an overview of the work of the
Committee during 2022.
The Board is committed to evaluating and reviewing its
structure, size and composition on a continual basis, including
its balance of skills, knowledge, experience and diversity
(including gender and ethnic diversity) while factoring in the
Company’s strategy, risk appetite and future development.
The Nomination Committee reviews and assesses Board
composition on behalf of the Board and recommends the
appointment of new Board members. In reviewing Board
composition, the Nomination Committee considers the
benefits of all aspects of diversity. I am glad that in 2022 the
Committee continued to assist the Board in this regard.
During the year, the Committee continued to undertake a
review of the broader composition of the Board, following the
appointments of three Independent Non-Executive Directors
during 2021.
The Committee identified a need to add an additional
Independent Non-Executive Director in 2022 to increase the
Board’s talent diversity. Furthermore, the Committee was
mindful that Daniel King, our long-serving Independent Non-
Executive Director and External Director had served since the
Company’s IPO in 2013, and after completing his third (and
last) three-year term, he was not eligible under the Companies
Law for re-election in 2022. Following a further search process,
and as announced on 18 March 2022, Prof. Varda Liberman
was appointed as an Independent Non-Executive Director.
REPORT OF THE
NOMINATION COMMITTEE
Committee attendance in FY 2022
Details of the number of scheduled Committee meetings
and individual attendance at these meetings are set out in
the Committee attendance table below.
Scheduled meetings
eligible to attend
Scheduled meetings
attended
Steve Baldwin (Chair) 2 2 (100%)
Prof. Jacob A. Frenkel 2 2 (100%)
Anne Grim
1
1 1 (100%)
Past member
Daniel King
2
1 1 (100%)
1. Anne Grim was appointed as a member of the Committee on 19 June
2022.
2. Daniel King stepped down from the Committee (and from the Board)
on 19 June 2022.
Report of the Nomination Committee
We aspire to promote
diversity, equality and
inclusion and I am
pleased that these
are also reflected in our
Board, with an equal
representation of female
and male Board members
Steve Baldwin
Chair of the Nomination Committee
62 Plus500 Ltd. Annual Report 2022
Prof. Liberman, as all other new Board members, has gone
through an extensive induction process, as further described
on page 57.
The Board is committed to diversity of gender, ethnicity,
background, nationality and professional experience. I am
delighted that our Board composition was again diversified
during FY 2022 by the addition of Prof. Varda Liberman as an
Independent Non-Executive Director, in addition to Ms. Sigalia
Heifetz, Ms. Tami Gottlieb and Prof. Jacob A. Frenkel, all of them
Independent Non-Executive Directors appointed in 2021.
These appointments have increased the gender diversity on
the Board, and have ensured that the Company increases its
talent diversity. As a result of the appointments of Non-
Executive Directors made over the last two years, I am pleased
to report that, as of the date of this Annual Report, the Board
meets the diversity targets set out in the FCA Listing Rules with
50% female Board members, including one of the senior Board
positions being held by a woman (Ms. Anne Grim as the Senior
Independent Director).
Ethnic diversity was also considered and discussed at the
Committee. I am pleased that our Board is diverse from an
ethnic perspective as well, in line with the FCA Listing Rules, with
25% of Board members (two Board members out of eight
Board members) from a minority ethnic background.
According to the evaluation carried out by the Board, all Non-
Executive Directors are considered to be independent in
character and judgement and no cross-directorships exist
between any of the Board members.
Due to the enhanced role of the Nomination Committee set
out in the Code, we are continuing to develop our programme
of activity accordingly. Throughout 2022, the Nomination
Committee dedicated time to review and discuss succession
planning across the business, in order to ensure, among other
things, that there is a good pipeline of female successors to
many of the senior management roles throughout the
business. Also, the Nomination Committee assured that all
immediate successors are already being developed in
accordance with the Company’s training programme which is
in place.
We aspire to promote diversity, equality and inclusion and I
am pleased that these are also reflected in our Board, with an
equal representation of female and male Board members.
The Committee will continue this year to ensure that there is a
strong talent pipeline with the necessary set of skills and
expertise, whilst considering female representation and other
diversity pillars as part of this process.
I look forward to reporting on the Nomination Committee’s
further progress in next year’s Annual Report.
Steve Baldwin
Chair of the Nomination Committee
22 March 2023
Committee composition
The Nomination Committee comprises Steve Baldwin
(as Chair), Prof. Jacob A. Frenkel and Anne Grim. The Code
recommends that a majority of the members of a
nomination committee should be Independent
Non-Executive Directors. The Board considers Steve
Baldwin, Jacob Frenkel and Anne Grim to be independent
for the purposes of the Code. Anne Grim, the Senior
Independent Director and External Director, replaced
Daniel King as a member of the Nomination Committee
as of June 2022. Details of the skills and experience of the
Nomination Committee members are set out on pages
52-55 of this Annual Report.
63 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Diversity
+ Review and amend the Equality,
Diversity and Inclusion Policy, in line
with the Code and the 40% target for
female board representation set out in
the FCA’s Listing Rules;
+ Review of gender diversity on the
Board, and increase the level of female
representation on the Board; and
+ Review of ethnic diversity on the Board
Governance
+ Review of the Committee’s terms of
reference in light of the Code and the
Companies Law; and
+ Review of 2022 Nomination Committee
Report which is included within this
Annual Report.
Following the activities of the Committee in 2022, the
Committee is confident that each Board member brings a
unique set of skills and experience which enables the Board to
be reflective of a diverse and varying range of perspectives
and opinions and enables the Company to achieve its strategy
and targets going forward.
The Committee believes that each Board member’s
contribution is important to the Company’s long-term
sustainable success.
Priorities for FY 2023
In the coming year the Committee will continue to focus on key
themes such as diversity and succession planning and
ensuring a diverse talent pipeline throughout the Group.
Equality, Diversity and Inclusion
Our policy on equality, diversity and inclusion commits to:
+ Ensuring that the selection and appointment process for
employees and Board members includes a diverse range of
candidates;
+ Ensuring that no unlawful discrimination, unfavourable or
less favourable facilities or treatment occurs at any stage in
the selection process on the grounds of age, disability,
gender, gender reassignment, marriage and civil
partnership, pregnancy or maternity, race, ethnic origin,
colour, nationality, national origin, religion or belief, sex or
sexual orientation, educational, professional, cultural and
socio-economic backgrounds, political opinion, sensitive
medical conditions and trade union membership;
+ Disclosing statistics on gender diversity in this Annual Report
as further detailed in page 31; and
+ Reviewing the Equality, Diversity and Inclusion Policy from
time to time to ensure that it complies with relevant local
laws and continuing to disclose the policy in the Annual
Report.
The Board has taken significant steps to increase gender
diversity. All Board appointments are made objectively, based
on an individual’s skills and expertise and consistent with the
Equality, Diversity and Inclusion Policy.
Report of the Nomination Committee continued
Committee responsibilities and activities
The Nomination Committee has responsibility for reviewing
the structure, size and composition (including the skills,
knowledge and experience) of the Board, considering
succession planning and ensuring diversity at Board-level.
The other key governance mandates pursuant to the written
terms of reference of the Nomination Committee (which are
available on the Company’s website) are as follows:
+ To oversee succession planning for Board members and
other senior Executives, taking into account the challenges
and opportunities facing the Company;
+ To identify, and nominate for the approval of the Board,
candidates to fill Board vacancies (including External
Directors’ vacancies);
+ To make recommendations concerning the continuation in
office of any Board member at any time, including the
suspension or termination of service; and
+ To prepare a description of the role and capabilities required
for a particular appointment.
The Nomination Committee meets not less than twice a year
and at such other times as required. The Nomination
Committee takes into account the challenges and
opportunities the Group is facing and which skills and expertise
are therefore needed on the Board and its Committees in the
future, whilst remaining committed to diversity of gender,
ethnicity, background, nationality and professional experience
and developing a talent pipeline reflective of this diversity.
A summary of the major activities and decisions of the
Committee in 2022 is set out below:
Board
composition
and time
commitment
+ Re-election of Board members;
+ Review of core skills and experience of
the Board and the independence of
the Non-Executive Directors;
+ Appointment of one Independent Non-
Executive Director;
+ Rotations of some members of the
committees;
+ Appointment of new Chairs of the
Remuneration, ESG and Regulatory &
Risk Committees (in Q1 2023); and
+ Review of time commitment of the
Non-Executive Directors.
Succession
planning
+ Review tenure of the Board members;
+ Review of the Company’s written
succession plan; and
+ Foster the development of talented
employees throughout the business.
64 Plus500 Ltd. Annual Report 2022
Equality, Diversity and Inclusion Policy
Objectives Progress updates
Ensuring the selection
and appointment process
for employees and Board
members includes a diverse
range of candidates
Review employees and
Board members’
recruitment procedure
which includes, among
others, a non-
discriminatory selection
process, allowing the
recruitment of a diverse
workforce.
Ensuring that no unlawful
discrimination occurs at
any stage in the selection
process on the grounds
of age, disability, gender
reassignment, marriage
and civil partnership,
maternity, pregnancy, race,
religion or belief, gender
or sexual orientation,
ethnicity, country of origin,
nationality and cultural
background
Review employees and
Board members’
recruitment procedures
which include non-
discriminatory selection
process, at all stages of the
selection process.
Relevant skills and experience on the Board
JACOB A.
FRENKEL
DAVID
ZRUIA
ELAD EVEN-
CHEN
STEVE
BALDWIN
ANNE
GRIM
SIGALIA
HEIFETZ
TAMI
GOTTLIEB
VARDA
LIBERMAN
Audit and risk management
NED ED ED NED NED NED NED NED
Finance, banking, financial
services and fund
management
NED ED NED NED NED NED NED
Capital raising, mergers,
acquisitions, investment and
transactions
NED ED NED NED NED
Marketing
ED NED NED
Compliance & regulation
NED ED ED NED NED NED NED NED
Shareholder relations
NED ED ED NED
Digital technology
ED NED NED NED
Innovation
NED ED ED NED NED NED NED
ESG
ED ED NED NED NED NED
Enterprise risk management
NED ED NED NED NED NED
ED
Executive Director
NED
Non-Executive Director
Objectives Progress updates
Improve gender diversity
at Board and senior
management level
One female Non-Executive
Director was appointed in
March 2022.
One female manager was
promoted to senior
management position in
January 2022.
Reviewing the Equality,
Diversity and Inclusion
Policy
The Committee has
reviewed and approved
the updated Equality,
Diversity and Inclusion
Policy, a copy of which is
available on the
Company’s website.
Succession planning
The Committee spent time in 2022 considering the important
matter of succession planning across the business and
reviewed the written Succession Planning Procedure. In order
to ensure minimal business disruption in the event of any
unexpected senior management or Board departures, the
Committee is committed to continue developing plans for
identifying appropriate successors in the short, medium and
long term, whilst also having regard to the importance of
diversity throughout the Group.
Due to the size of the Group, it is not always possible to identify
internal successors for all roles throughout the business.
Nevertheless, the Committee has reviewed plans for the
succession of senior management roles throughout the
business and has identified appropriate candidates as
potential successors (both immediate successors and long-
term successors).
65 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Report of the Audit Committee
Dear shareholder
I am pleased to take this opportunity to give you an overview
of the work of the Committee during 2022. The Audit Committee
performs a key role in the Group’s governance framework, in
assessing internal controls across the Group and ensuring the
integrity of the Group’s financial results.
Priorities for the Audit Committee during the year included
financial reporting and the associated assurance of these
reports, replacement of our internal auditors and an
independent third-party evaluation of the Committee’s
performance and effectiveness. The Audit Committee
functions very efficiently, supported by a number of consistent
and professional processes that form the basis of the
Committee’s monitoring and review framework.
In January 2022, we concluded that given the increase in the
scope of business of the Group and the diversification of its
portfolio and geographical scope, it would be in the
Company’s best interests to replace our internal auditors. As a
result, and after due process, conducted in accordance with
the provisions of the Companies Law, the Audit Committee
recommended to the Board to appoint EY as our new internal
auditors, as of FY 2022, and the Board adopted this
recommendation. EY’s team is risk-oriented, professional and
familiar with the Group’s business and operations. Since being
appointed, the EY team has carried out an extensive risk
assessment, which was presented to the Committee at its
October 2022 meeting. Also, a multi-year internal audit plan
was approved by the Audit Committee, including a specific
work plan for FY 2023.
Committee attendance in FY 2022
Details of the number of scheduled Committee meetings
and individual attendance at these meetings are set out in
the Committee attendance table below.
Scheduled meetings
eligible to attend
Scheduled meetings
attended
Tami Gottlieb (Chair) 7 7 (100%)
Steve Baldwin 7 7 (100%)
Anne Grim 7 7 (100%)
Prof. Varda Liberman
1
5 5 (100%)
Past member
Daniel King
2
4 3 (75%)
1. Varda Liberman was appointed as a member of the Committee on 18
March 2022.
2. Daniel King stepped down from the Committee (and from the Board)
on 19 June 2022.
REPORT OF THE AUDIT
COMMITTEE
The Audit Committee
functions very efficiently,
supported by a number of
consistent and
professional processes
that form the basis of the
Committee’s monitoring
and review framework
Tami Gottlieb
Chair of the Audit Committee
66 Plus500 Ltd. Annual Report 2022
In March 2022 we welcomed Prof. Varda Liberman as a
member of the Committee and in June 2022 we thanked
Daniel King, our long-serving director and a member of the
Audit Committee over the past nine years, who ended his
maximum tenure under the provisions of the Companies Law.
The Committee also reviewed a list of non-audit services
provided this year by the Company’s external auditors and
approved the audit plan for 2023. Related party transactions
were also reviewed and monitored by the Committee on a
semi-annual basis and the Committee members held two
closed sessions with its internal and external auditors only, in
order to evaluate and assess management’s effectiveness.
During the year, an independent third-party evaluation of the
Audit Committee was carried out by Nasdaq Governance
Solutions in order to assess the Committee’s performance
and effectiveness. The results of the evaluation were good and
the Committee will implement several recommendations
derived from this evaluation in the course of 2023.
I look forward to reporting on the Audit Committee’s progress
going forward, in next year’s Annual Report.
Tami Gottlieb
Chair of the Audit Committee
22 March 2023
Committee composition
The Code recommends that an Audit Committee should
include at least three members who are Independent
Non-Executive Directors, and that at least one member
should have recent and relevant financial experience. The
Companies Law requires that an Audit Committee consist
of at least three Directors qualified to serve as members of
an audit committee under the Companies Law, including
all External Directors, and must be comprised of a majority
of Board members meeting certain independence
criteria of the Companies Law. The Chair of the audit
committee must be an External Director.
The Audit Committee is chaired by Tami Gottlieb and its
other members are Steve Baldwin, Anne Grim and Prof.
Varda Liberman (appointed as of March 2022). All of the
members are therefore Independent Non-Executive
Directors under the Code and meet the criteria for
independence under the Companies Law. Tami Gottlieb
and Anne Grim are considered External Directors under
the Companies Law.
The Board considers that Tami Gottlieb has recent and
relevant financial experience in accordance with the
requirements of the Code. All of the Committee members
have relevant diversified financial services experience.
Details of the skills and experience of the Audit Committee
members are set out on pages 52-55.
67 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Report of the Audit Committee continued
A summary of the major activities and decisions of the
Committee in 2022 is set out below:
Financial
performance
review
Review of the financial performance and
review of the Consolidated Financial
Statements of the Group twice a year.
Replacement
of internal
auditors
Replacement of the Company’s internal
auditors after due process, conducted in
accordance with the provisions of the
Companies Law.
Risk
assessment
review and
internal audit
plan
Review of findings of the risk assessment
conducted by the Company’s new
internal auditor EY Israel and subsequent
adoption of a multi-year internal audit
plan including a specific internal audit
plan for FY 2023.
External audit
review
Review progress on implementing
external audit recommendations.
Monitor and review the effectiveness,
independence and objectivity of the
external audit function.
Risk control
Assist the Board in the monitoring of the
Group’s internal controls and risk
management systems and their
effectiveness.
2022 external
Committee
evaluation
Discussion and assessment of the 2022
independent third-party Audit
Committee evaluation findings.
Governance
+ Review of the Committee’s terms of
reference in light of the Code and the
Companies Law.
+ Review of 2022 Audit Committee Report
which is included within this Annual
Report.
Significant accounting and financial judgements in 2022
The Committee considered a number of significant
accounting and financial judgements and estimates, which
were discussed with the external auditors in the planning
stage of the audit, and received the external auditor’s
confirmation that no additional matters have arisen which
require the Committee’s attention.
The significant judgements considered were: revenue
recognition, uncertain tax positions, the control environment,
compliance with laws and regulations. Also, the committee
considered the appropriateness of the going concern basis of
the Consolidated Financial Statements and the level of cash
required within the business to satisfy both external regulatory
requirements and the Group’s market risk management.
Committee responsibilities and activities
The Audit Committee is responsible for ensuring that the
financial performance of the Group is properly reported on
and reviewed. The other main key governance mandates
pursuant to the written terms of reference of the Audit
Committee (which are available on the Company’s website)
are, among others, as follows:
+ To monitor the integrity and adequacy of the Consolidated
Financial Statements of the Group (including annual and
interim accounts and results announcements);
+ To monitor the adequacy and effectiveness of the
Company’s internal financial controls and internal control
and risk management systems;
+ To advise on the appointment of the Company’s external
auditor and on their remuneration; and
+ To monitor and review the effectiveness of the Company’s
internal audit function.
In addition, under the Companies Law, the Audit Committee is
required to monitor deficiencies in the business management
of the Company, including by consulting with the internal
auditor and independent accountants, to review, classify and
approve related party transactions and extraordinary
transactions, to review the internal auditor’s audit plan, to
oversee the performance of the Company’s internal auditor
and the internal control functions and to establish and monitor
whistleblower procedures.
The Audit Committee meets not less than four times a year at
appropriate intervals in the financial reporting and audit cycle
and otherwise as required. The Audit Committee met seven
times during 2022. The internal and external auditors have the
right to attend meetings. The relevant Executive Directors, the
Company’s legal advisors and other persons may, by invitation
from the Chair of the Audit Committee, attend meetings.
As recommended under the Companies Law, an Audit
Committee should hold at least once a year a meeting to
consider any defects in the Company’s business
administration, with the presence of the internal and external
auditors, and without the presence of officers in the company
who are not members of the Audit Committee. Our Audit
Committee members have followed this recommendation,
and as a matter of enhanced best practice, it meets privately
twice a year with its external auditor and the internal auditor to
discuss these issues.
68 Plus500 Ltd. Annual Report 2022
External auditor
It is the responsibility of the Audit Committee to keep under
review the scope and effectiveness of the external auditor. This
includes recommending the appointment and/or
reappointment of the external auditor to the Board (and to
shareholders) and reviewing the scope of the audit, approving
the audit fee and, on an annual basis, satisfying itself that the
auditor is independent and objective. The external auditor is
engaged to express an opinion on the Consolidated Financial
Statements. The external auditor conducts the audit
according to the audit plan which includes different audit
procedures like confirmations, testing samples and discussing
with management the reporting of operational results and the
financial status of the Group, to the extent necessary to
express their audit opinion.
Performance and effectiveness of the external auditor
Kesselman & Kesselman, a member firm of Pricewaterhouse-
Coopers International Limited, was appointed as the
Company’s external auditor in 2013 and has been retained
since then to perform audit and audit-related work on the
Company, and other local offices of PricewaterhouseCoopers
perform audit and audit-related work on the majority of the
Company’s subsidiaries. The Committee assesses the
auditor’s independence, effectiveness and objectivity at least
on an annual basis, through closed sessions and enquiries by
the Committee members.
The Audit Committee monitors the nature and extent of non-
audit work undertaken by the auditors. Given the non-audit
work undertaken by the external auditor and the Committee’s
oversight of its work, the Committee is satisfied that the
independence and objectivity of the external auditor was
adequately safeguarded throughout 2022. Nevertheless, the
external auditor’s independence and objectivity is kept under
on-going review and is a standing item on the agenda for the
Audit Committee.
In addition, the Audit Committee monitors annually the cost of
non-audit work undertaken by the external auditor. The Audit
Committee considers that it is in a position to take action if at
any time it believes there is a risk of the auditor’s independence
and objectivity being undermined through the award of this
task.
Having assessed the external auditor’s effectiveness and
independence during 2022, the Audit Committee concluded
that the auditor has demonstrated professional scepticism
and judgement and that the audit process as a whole has
been conducted robustly and that the team selected to un-
dertake the audit has done so thoroughly and professionally.
Audit tender process
In FY 2022, the external audit engagement partner was rotated.
The Committee has noted the tendering and rotation
provisions in the EU Audit Directive and Regulation, which state
that there should be a public tender every ten years and
rotation of auditors at least every twenty years. The Committee
also confirms compliance with the provisions of the Statutory
Audit Services for Large Companies Market Investigation
(Mandatory Use of Competitive Tender Processes and Audit
Committee Responsibilities) Order 2014.
To that effect, the Company intends to conduct a formal
tender process for audit services during the financial year
ended 2023. The Audit Committee considers this timing to be
in the best interest of the Company and following this process,
a recommendation will be made to the shareholders at the
2024 AGM for the appointment of the selected auditors.
Non-audit services
The Company maintains a Non-Audit Services Policy in order
to ensure that the provision of non-audit services do not
impair the external auditor’s independence or objectivity.
During 2022, Kesselman & Kesselman, a member firm of
PricewaterhouseCoopers International Limited, and other
local offices of PricewaterhouseCoopers, provided non-audit
services, such as tax assessments and advice and regulatory
reporting requirements, which totalled $0.8m (including
assurance-related services of $0.3m). The assurance-related
services include mainly local regulatory reporting
requirements for the regulated subsidiaries which are linked
directly with the external auditor’s services. In addition, part of
the non-audit services in the amount of $0.5m are related to
tax assessments which are provided by the external auditor
according to common practice in specific territories.
The non-audit services fee constitutes 57% of the fees payable
to the external auditor in 2022.
Overview of the Non-Audit Services Policy
Under the policy, all services provided by the external auditor
(other than the audit itself) are regarded as non-audit
services. The policy draws a distinction between permitted
services (which could be provided subject to conditions set by
the Committee) and prohibited services. The type of non-
audit services deemed to be permitted include assurance
work on non-financial data, tax services including tax advisory
and reporting best practice.
The Committee has provided pre-approval which allows
management to appoint the external auditor to conduct
permitted non-audit services if they fall below a set fee level.
The Committee reviews the pre-approval limit on an annual
basis and it is currently set at $50,000. Any non-audit service
provided by the external auditor is reported to the Board. In the
event that the provision of non-audit services would exceed
$50,000, the Committee would request Board approval.
69 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
KEY FINANCIAL REPORTING AND SIGNIFICANT FINANCIAL JUDGEMENTS HOW THE ISSUE WAS ADDRESSED BY THE AUDIT COMMITTEE
Revenue recognition
The recognition of revenue is
a key matter to be reviewed,
monitored and tested
+ The Audit Committee held meetings, among others, with the
operation, R&D and risk teams to verify compliance of revenue
recognition from all related aspects such as: IT general controls,
access to programs and supporting data, program changes and
computer operations for the platform and for the ERP system.
+ The Audit Committee discussed this matter with the external
auditor at the planning and conclusion phases of the audit.
+ The Audit Committee concluded that the revenue recognition
process is appropriate and controls are effective and are
appropriately disclosed in the Consolidated Financial Statements.
Uncertain tax positions
The Audit Committee is
responsible for the
adequacy of the uncertain
tax positions
+ The Audit Committee held meetings, amongst others, with
management and tax advisors to assist in assessing the technical
aspect of the Group’s tax positions, including understanding the
correspondence with the different tax authorities and reviewing
other third parties’ advice obtained by management.
+ The Audit Committee discussed this matter with the external
auditor through the process of the audit, and received periodical
updates during the year.
+ The Audit Committee concluded that the provision for uncertain
tax positions is reasonable.
Review and
assessment of the
control environment
The Audit Committee has the
ultimate responsibility for the
supervision of the control
environment. A key role of the
Committee is to provide
oversight and reassurance to
the Board with regard to the
integrity of the Company’s
financial reporting, internal
control policies and
procedures for the
identification, assessment
and reporting of risk
+ The Audit Committee reviewed and approved a multi-year internal
audit plan, as well as a specific internal audit plan for FY 2023,
following an extensive risk assessment process conducted by EY,
the Company’s new internal auditors. The Audit Committee
discussed key findings with management and reviewed the
implementation of all internal audit report recommendations
brought forward from previous years. In addition, the Committee
reviewed key audit risk topics as presented by the Company’s
internal auditors.
+ Management is responsible for establishing and maintaining
adequate internal control over financial reporting. Under the
supervision of the Audit Committee and with management
participation, including the Chief Executive Officer and the Chief
Financial Officer, the Audit Committee evaluated the effectiveness
of the Company’s internal control over financial reporting. In
making this evaluation, which included planning and scoping,
design assessment of the risks and controls, and controls
effectiveness assessment (testing), the Audit Committee and the
management have concluded that, as of 31 December 2022, the
internal control over financial reporting is effective.
Review and
assessment of
compliance with laws
and regulations
A key risk to the business is
the fact that the Group’s
business is subject to various
laws and regulations in
different jurisdictions
according to its activities
+ The Committee, in conjunction with the work of the Regulatory & Risk
Committee, reviewed regulatory and compliance reports prepared
by the Risk and Compliance teams, to ensure compliance with local
regulations in the geographic and business areas the Group
operates in.
+ The Committee considers the grid of audits and regulatory
assessments and reviews their findings. The relevant aspects of
such assessments to the Committee’s work are discussed and
assessed by the Committee.
+ Based on discussions with management and discussions held in
the Regulatory & Risk Committee, the Audit Committee came to the
conclusion that the Group is compliant with the required regulations.
Report of the Audit Committee continued
70 Plus500 Ltd. Annual Report 2022
Internal auditor
Pursuant to the Companies Law, the Board must appoint an
internal auditor recommended by the Audit Committee. An
internal auditor may not be:
+ a person who holds more than 5% of the Company’s
outstanding shares or voting rights;
+ a person who has the power to appoint a Board member or
the Chief Executive Officer of the Company;
+ an officer or Board member of the Company; or
+ a member of the Company’s independent accounting firm,
or anyone on its behalf.
The role of the internal auditor is to examine, among other
things, the Company’s compliance with applicable laws and
orderly business procedures. The Audit Committee is required
to oversee the activities and to assess the performance of the
internal auditor, as well as to review the internal auditor’s work
plan, and the Committee has done so in FY 2022.
Following a review by the Audit Committee, the Committee
came to the conclusion that, given the increase in the scope of
business of the Group and the diversification of its portfolio and
geographical scope, it would be in the Company’s best interests
to replace the Company’s internal auditors. Subsequently, and
after due process, conducted in accordance with the provisions
of the Companies Law, the Audit Committee decided to appoint
Kost Forer Gabbay & Kasierer (EY Israel), a member firm of Ernst
& Young, as the Company’s new internal auditors, as of FY 2022.
During 2022, EY Israel performed an extensive risk assessment,
which was presented to the Committee at its October 2022
meeting. The Committee concluded that the internal audit
function was an effective provider of assurance over the
Company’s risks and that the Company had the controls and
appropriate resources as required.
Based on the findings of the risk assessment conducted by EY
Israel, a multi-year internal audit plan, including a specific
internal audit plan for FY 2023, was approved by the Committee.
Fair, balanced and understandable
The Audit Committee undertakes a duty to consider
whether the 2022 Annual Report and Consolidated
Financial Statements taken as a whole, are fair, balanced
and understandable, while final determination lies within
the responsibilities of the Board. The Audit Committee, on
behalf of the Board, also assesses whether there is enough
information in the Annual Report and Consolidated
Financial Statements necessary for shareholders to
evaluate the financial position, performance, governance,
business model and strategy of the Group.
The process
The Committee reviews the Consolidated Financial
Statements and recommends their approval by the Board.
During the drafting process of the 2022 Annual Report and
Consolidated Financial Statements, the Committee was
given the opportunity to comment and provide feedback
on the drafts. The Committee also considers whether the
content provided in the report has illustrated the whole
picture for the year.
The Committee then evaluated whether the report is
consistent throughout, with a clear layout and linkage to
the different front and back sections, and whether it is
presented in a logical manner to the shareholders.
Conclusion
Following the review, it was the Committee’s opinion that
the 2022 Annual Report and Consolidated Financial
Statements are representative of the year and, taken as a
whole, present a fair, balanced and understandable
overview and provides the information necessary for
shareholders to assess the financial position, governance,
performance, business model and strategy of the Group.
KEY FINANCIAL REPORTING AND SIGNIFICANT FINANCIAL JUDGEMENTS HOW THE ISSUE WAS ADDRESSED BY THE AUDIT COMMITTEE
Review and assessment
of appropriateness
of the going concern
basis of the Financial
Statements and long-
term viability
Going concern and viability
are key matters for the
operations of the Group
+ The Audit Committee has reviewed the assessment setting out the
key assumptions related to the nature of the Group’s business,
budget reports and cash flow forecasts for the period of three
years ending 31 December 2025, taking into account the Group’s
anticipated investment commitments and working capital
requirements.
+ These reports detailed the impact of outcomes of stress tests after
applying multiple scenarios to determine how the Group is able to
cope with deterioration in the liquidity profile or capital position.
+ The Audit Committee recommended the Going Concern and
Viability Statement to the Board for approval.
Review and assessment
of the level of cash
required within the
business to satisfy both
external regulatory
requirements and the
Group’s attitude to
market risk
The Group requires a level
of cash to ensure that it
can operate its trading
platforms and maintain
sufficient cash in its
regulated entities to satisfy
regulatory and operational
needs
+ The Audit Committee reviews on an on-going basis the level of
cash required from a regulatory, operational and risk perspective.
+ The Audit Committee concluded that the cash amounts held are
sufficient for all the above-mentioned perspectives.
71 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Audit Committee evaluation
In 2022, the Company engaged Nasdaq Governance Solutions
to facilitate the external evaluation of the Board and the Audit
Committee.
The Audit Committee evaluation comprised completion of
written questionnaires via a secure digital platform, individual
interviews conducted by Nasdaq Governance Solutions’
experts with Audit Committee members and observance of
one Audit Committee meeting.
The observations and recommendations from the evaluation
were discussed with the Chair of the Audit Committee and the
final evaluation report was presented by Nasdaq Governance
Solutions in December 2022.
The Audit Committee evaluation covered various aspects of
the Committee performance including:
+ Committee culture
+ Committee composition and structure
+ Committee meetings, information and resources
+ Committee role, including oversight of financial reporting,
internal audit and external audit functions
The evaluation determined that the Audit Committee had high
degrees of effectiveness, inter alia, in relation to the following:
+ Committee engagement with internal and external auditors
+ Committee’s management of the process to replace the
internal auditors
+ Committee leadership – the Chair being viewed by the
members as an excellent and inclusive leader
Opportunities for improved effectiveness were also identified,
alongside some focus areas for 2023. To strengthen its
effectiveness, the Audit Committee, supported by the Company
Secretary, is evaluating the findings from the external evaluation
and, with the help of the actions identified in the report, will
address and strengthen different focus areas arising from the
external evaluation.
Whistleblowing Policy
The Group operates a Whistleblowing Policy which encourages
all individuals within the Group (including employees, partners,
consultants, contractors, suppliers, customers and other third
parties) to feel confident to voice concerns internally in a
responsible, anonymous, confidential and effective manner
when they discover information which they believe shows
serious malpractice or impropriety, and to question and act
upon those concerns. It provides a method of properly
addressing bona fide concerns of such individuals, while
offering whistleblowers protection from victimisation,
harassment or disciplinary proceedings. Such anonymous
reporting can be undertaken 24/7 in local languages. This
policy and its implementation are reviewed on a regular basis,
and annually by the Audit Committee and the Board. The Audit
Committee reports to the Board on the effectiveness of the
Group’s whistleblowing mechanism and on any matter that
arises as a result of it. The current Whistleblowing Policy
supervisor is Steve Baldwin, who replaced Daniel King upon his
tenure ending in June 2022. No whistleblowing complaints were
received in 2022.
Report of the Audit Committee continued
72 Plus500 Ltd. Annual Report 2022
Dear shareholder
I am privileged to have been appointed recently as Chair of
the Regulatory & Risk Committee, after serving as a member
of the Committee since the day I joined the Board, in March
2022. I would like to take this opportunity to thank Sigalia
Heifetz, my predecessor, for her dedication in leading the
Regulatory & Risk Committee in the past two years.
Regulatory compliance and risk management underpin the
integrity of our business model and the continued delivery of
our strategy. The Regulatory & Risk Committee receives regular
reports on both compliance and risk and challenges the
performance in these areas. It also receives AML reports and
internal audit reports relating to the Group’s regulated entities,
and other reports on specific areas where more detailed
testing is felt appropriate. These are described more fully in
the following report.
In addition, we undertook a robust assessment of the principal
risks facing the Group and updated its internal risk matrix
accordingly. We have also monitored new areas of regulatory
compliance such as emerging risks and developments in
securities markets regulation.
As the Group has continued to develop its position as a global
multi-asset fintech group, by launching new products and
extending its geographic footprint, the Committee continued
to monitor the main trading-related risks of the Group. On a
monthly basis, the Committee is provided with detailed risk
reports covering, inter alia, system exposures, performance
analysis, risk mitigation and VaR analysis.
Committee attendance in FY 2022
Details of the number of scheduled Committee meetings
and individual attendance at these meetings are set out
in the Committee attendance table below.
Scheduled meetings
eligible to attend
Scheduled meetings
attended
Prof. Varda Liberman
(Chair)
1
3 3 (100%)
Elad Even-Chen 3 3 (100%)
Tami Gottlieb 3 3 (100%)
Prof. Jacob A. Frenkel 3 3 (100%)
Sigalia Heifetz 3 3 (100%)
1. Prof. Varda Liberman was appointed as a member of the Committee
on 18 March 2022 and serves as the Chair of the Committee as of 14
February 2023.
REPORT OF THE REGULATORY
& RISK COMMITTEE
Report of the Regulatory & Risk Committee
The Committee has
monitored upcoming
regulatory changes that
have arisen during 2022
which are applicable to
the Group’s operations
Prof. Varda Liberman
Chair of the Regulatory & Risk Committee
73 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Report of the Regulatory & Risk Committee continued
The Committee and the Board have received reports in
relation to the new trading products launched by the Group in
2021 and 2022 – share dealing through ‘Plus500 Invest’ and
futures and options on futures, including ‘TradeSniper’, our
intuitive new proprietary trading platform for US futures retail
traders. In 2022, the Committee monitored regulatory changes
that arose during the year, which are applicable to the Group’s
operations.
The Group’s portfolio of regulatory licences is an increasingly
valuable asset, given their scarcity and the growing
complexity of obtaining new licences. I am pleased that
during 2022 and Q1 2023 this portfolio of regulatory licences
was further strengthened.
The regulatory licence granted in Estonia in February 2022 will
further support the Group’s business across European markets
in its core product offering. The acquisition of a regulated firm
in Japan, completed in March 2022, represents a major growth
opportunity for the Group, through an immediate presence in
the substantial retail trading market in Japan.
In February 2023, the Group obtained a regulatory licence in
the United Arab Emirates, granted by the Dubai Financial
Services Authority (DFSA), offering a major potential growth
opportunity for Plus500, by allowing the Group to expand its
offerings to customers in a significant and high growth market.
During the year, the Committee invited representatives from
the Group’s subsidiaries such as CEOs and Risk & Compliance
officers to present to the Committee the main risk and
compliance issues related to their operations. In-depth
discussions were held by the Committee in relation to the risks
associated with the Group’s US operation, as well as an
overview of the other Group’s operations. The Committee will
continue to host subsidiaries’ representatives in the course of
FY 2023. In 2022, the Committee members (and the Board as a
whole) participated in regulatory training by the Company’s
external legal advisors and the Group’s Chief Regulation
Officer.
Our priorities for the coming year will be to continue to monitor
regulatory changes and to enhance the risk assessment and
monitoring within the business in the face of changing
regulatory and market conditions.
More specifically, we will continue to assess, and seek to
enhance, our approach to risk management, which is based
on ensuring our risk exposures are aligned with our risk
appetite across our product portfolio.
From a regulatory and compliance perspective, with a global
regulatory network already well established, the Committee
believes that the Group remains well positioned for potential
future changes to the regulatory environment across the
markets in which it operates.
I look forward to reporting on the Regulatory & Risk Committee’s
further progress in next year’s Annual Report.
Prof. Varda Liberman
Chair of the Regulatory & Risk Committee
22 March 2023
74 Plus500 Ltd. Annual Report 2022
Committee responsibilities and activities
The Regulatory & Risk Committee meets not less than three
times a year and otherwise as required. The Regulatory & Risk
Committee receives monthly updates from management on
risk, compliance, AML and regulatory issues and reviews the
related internal reports. The Regulatory & Risk Committee has
responsibility for providing oversight with respect to current
and potential future risk exposures of the Group and for
overseeing and monitoring the Group’s compliance with
applicable laws, regulations and orders as required. Its
activities include reviewing relationships with regulatory
authorities such as: the Financial Conduct Authority (FCA) in
the UK, the Australian Securities and Investments Commission
(ASIC) in Australia, the Cyprus Securities and Exchange
Commission (CySEC) in Cyprus, the Israel Securities Authority
(ISA) in Israel, the Financial Markets Authority (FMA) in New
Zealand, the Financial Sector Conduct Authority (FSCA) in
South Africa, the Monetary Authority of Singapore (MAS) in
Singapore, the Financial Services Authority (FSA) in the
Seychelles, the Commodities Futures Trading Commission
(CFTC) and National Futures Association (NFA) in the US, the
Estonian Financial Supervision Authority (EFSA) in Estonia, the
Financial Services Agency (FSA) in Japan, the Dubai Financial
Services Authority (DFSA) in the UAE and other regulatory
authorities, as appropriate, in jurisdictions where the Group
has a significant operation. The Committee is also responsible
for reviewing risk assessment programmes and internal
controls.
The Regulatory & Risk Committee is responsible for reviewing
the Group’s most significant risks to the achievement of
strategic objectives and any emerging risks, reviewing the
Group’s Risk Management Policy and ensuring that the
Company’s ethics are being adhered to. The other key
governance mandates, pursuant to the written terms of
reference of the Regulatory & Risk Committee (which are
available on the Company’s website), are as follows:
+ To oversee and advise the Board on current and emerging
risk exposures of the Company and future risk strategy;
+ To keep under review the adequacy and effectiveness of the
Company’s internal financial controls and internal control
and risk management strategy and systems;
+ To review the Group’s capability to identify and manage new
risk types;
+ To review the most significant risks to the achievement of
strategic objectives;
+ To review incident reports to monitor incidents and remedial
activity; and
+ To consider and approve the remit of the risk management
function and ensure that it has adequate resources and
appropriate access to information to enable it to perform its
function effectively and in accordance with the relevant
professional standards.
A summary of the major activities and decisions of the
Committee in 2022 is set out below.
Regulatory
and
compliance
review
+ Periodic regulatory, compliance and
AML reports review.
+ Oversee the implementation of new
regulatory requirements.
+ Monitor and assess the Group’s
relationships with regulatory
authorities.
Licence
application
review
+ Review licence applications prepared
during the period.
Risk
review and
assessment
+ Review periodic risk reports, including
VaR reports and performance analysis
reports.
+ Review risk assessment programmes
and internal risk management
controls.
+ Review emerging and principal risks for
the period and the Company’s risk
register.
+ Review and assess current approach
to hedging as well as possible options
for future approaches in this area.
+ Review risks associated with the
Group’s new operations.
Regulatory
training
+ Participated in regulatory training by
the Company’s external legal advisors
and the Group’s Chief Regulation
Officer.
Governance
+ Review of the Committee’s terms of
reference.
+ Review of 2022 Regulatory & Risk
Committee Report which is included
within this Annual Report.
+ Review of 2022 Risk Management
Framework which is included within this
Annual Report.
Climate
Change
+ Review of 2022 TCFD Report which is
included within this Annual Report.
Committee composition
The Regulatory & Risk Committee is chaired by Prof. Varda
Liberman (appointed as a member in March 2022 and as
Chair in February 2023), succeeding Sigalia Heifetz as
Chair. The other members are Elad Even-Chen, Tami
Gottlieb, Sigalia Heifetz and Prof. Jacob A. Frenkel.
According to the Committee’s terms of reference (which
are available on the Company’s website) the Committee
shall comprise at least three members, the activities of
the Committee should involve participation by the Chair
of the Audit Committee (Tami Gottlieb) and the Group
Chief Financial Officer (Elad Even-Chen) should be a
member of the Committee. Details of the skills and
experience of the Regulatory & Risk Committee members
can be found on pages 52-55.
75 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Dear shareholder
Having served as a member of the ESG Committee since its
establishment in 2020, I am honoured to have been also
appointed as Chair of the Committee as of June 2022. I would
like to thank Daniel King, my predecessor, for his continuous
efforts in establishing, shaping and guiding the work of the
Committee, and for his dedication and focus on ensuring that
the Committee has a clear framework from which to operate. I
would also like to welcome our CEO, David Zruia, who was
appointed as a member of the Committee as of August 2022.
ESG continues to be a critical element of organisational
culture, operations, reporting and disclosure and is now, more
than ever before, a highly prevalent theme across global
capital markets. This has been driven by growing public
pressure, increasing regulator engagement and investors
integrating ESG into their investment analysis. In this dynamic
and complex environment, ESG issues can have a direct
impact on a company’s competitive advantage and
operational performance. Furthermore, investors, naturally,
are seeking more understanding and detail about how
companies are managed in this regard.
Being established for more than two years now, the ESG
Committee, as well as the Board and the entire Group, remain
committed to developing our ESG strategy, and will continue
to broaden the disclosure on ESG matters in order to ensure
key stakeholders have a clear and comprehensive
understanding of the Group’s activities in these areas.
Committee attendance in FY 2022
Details of the number of scheduled Committee meetings
and individual attendance at these meetings are set out
in the Committee attendance table below.
Scheduled meetings
eligible to attend
Scheduled meetings
attended
Steve Baldwin (Chair)
1
3 3 (100%)
Anne Grim 3 3 (100%)
David Zruia
2
2 2 (100%)
Past member
Daniel King
3
1 1 (100%)
1. Steve Baldwin was appointed as Chair of the Committee on
19 June 2022.
2. David Zruia was appointed as a member of the Committee
on 1 August 2022.
3. Daniel King (previous Chair of the Committee) stepped down from
the Committee (and from the Board) on 19 June 2022.
REPORT OF THE ESG
COMMITTEE
ESG continues to be a
critical element of
organisational culture,
operations, reporting
and disclosure and is
now, more than ever
before, a highly prevalent
theme across global
capital markets
Steve Baldwin
Chair of the ESG Committee
Report of the ESG Committee
76 Plus500 Ltd. Annual Report 2022
I am pleased to provide an overview of the work carried out by
the ESG Committee in 2022, as well as its objectives and
priorities for the coming year.
A comprehensive materiality assessment carried out in 2021
identified several ESG priority areas for Plus500 – namely,
customer care and protection, organisational culture, cyber
security, systems infrastructure and leadership and
governance. Our commercial and operational approach and
progress during 2022 in each of the areas can be found in this
Annual Report, in particular in the ESG section on pages 28-32.
With the assessment laying the foundations of the Group’s
approach in this area, the Committee made strong progress
during the year to develop Plus500’s position in ESG, in
particular by refreshing our reporting and disclosure, in line
with the latest regulatory and disclosure requirements, as
exemplified in various sections of this Annual Report.
The Company supports the recommendations published by
the TCFD and during 2021 and 2022, the Committee worked
with a specialist ESG consultant, which conducted a rigorous
gap analysis and assessment of the Group’s ESG reporting
and disclosure, against its UK-listed peer group and a range of
US-listed fintech groups. This assessment has helped to
provide a foundation for the Group’s on-going approach to
ESG reporting and disclosure going forward.
More specifically, conclusions from this assessment have
helped to inform the Group’s detailed reporting and disclosure
against the TCFD recommendations, which includes the
reporting of our Scope 1 and Scope 2 emissions data. This
information, including the Group’s future plans to continue to
align itself to the TCFD recommendations, is outlined in the
TCFD section on pages 33-37 of this Annual Report.
Also during the year, the Committee and the Board continued
to review Plus500’s Environmental Policy, which is available on
the Company’s website. The Group remains committed to
managing its environmental impact, consistently aiming to
ensure that it conducts appropriate and necessary actions to
minimise the impact of its operations on the environment. The
Group has made various commitments, including, to protect
the environment, to reduce waste as well as water, energy and
resource use, to monitor the Group’s environmental
performance and to ensure that office services are sourced
from providers that share these commitments.
The Committee reviewed the Donations & Volunteering
Procedure and received a report from the Company’s
Donations Committee detailing the type and amounts of
donations made during 2022 and 2021 (both monetary and in-
kind donations), the profile of charitable and non-profit
organisations which received the donations and future
charitable initiatives.
The Committee continued to be mindful of the various diversity
aspects, and monitored, in conjunction with the Nomination
Committee, that our Board is sufficiently diverse from both
gender and ethnic perspectives, and also reviewed gender
diversity as part of the Group’s succession planning. In depth
discussions were held in the Committee during the course of
2022, with key focus on social aspects, such as customers’
satisfaction and employee welfare and wellbeing.
I look forward to reporting on the ESG Committee’s further
progress in next year’s Annual Report.
Steve Baldwin
Chair of the ESG Committee
22 March 2023
Committee composition
The ESG Committee is chaired by Steve Baldwin. The other
members are Anne Grim and David Zruia (as of August
2022). According to the Committee’s written terms of
reference (which are available on the Company’s website)
the Committee shall comprise at least three members, a
majority of the members of the Committee should be
Independent Non-Executive Directors (Steve Baldwin and
Anne Grim) and at least one member shall be an External
Director (Anne Grim). Details of the skills and experience of
the ESG Committee members can be found on pages
52-55.
77 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Report of the ESG Committee continued
A summary of the major activities and decisions of the
Committee in 2022 is set out below:
Reports and
policies
review
+ Periodic review of ESG reports.
+ Review of succession planning (from a
gender diversity perspective).
+ Review of Donations & Volunteering
Procedure.
Diversity
review
+ Review of gender diversity on the Board.
+ Review of ethnic diversity on the Board.
Review of
policies
+ Review of the Company’s Environmental
Policy and Equality, Diversity and
Inclusion Policy.
Donations
and
community
initiatives
review
+ Review type and amounts of donations
made during 2021-2022 (both monetary
and in-kind donations), profile of
charitable and/or non-profit
organisations which received the
donations and future charitable
initiatives.
Customer
satisfaction
+ In depth review of customer feedback in
2022, presented by the Group Head of
Customer Support.
Employees
welfare &
wellbeing
+ In depth review of employees’ welfare,
wellbeing and development, presented
by the Group VP HR.
Materiality
assessment
+ Review of, and feedback on, detailed
materiality assessment.
+ Discussion and agreement on key priority
areas emanating from this assessment,
including an approach on future
reporting and disclosure in each of these
areas.
Gap
analysis
+ Working with a specialist ESG consultant
to conduct gap analysis of the Group’s
ESG reporting and disclosure, compared
to our UK-listed peer groups and US-
listed fintech groups.
+ Discussed and agreed approach for
Group’s ESG reporting and disclosure,
based on the findings of this analysis.
TCFD
reporting
+ Working with a specialist ESG consultant
to prepare detailed reporting and
disclosure against the TCFD
recommendations, which includes the
reporting of our Scope 1 and Scope 2
emissions data (see page 33 of this
Annual Report).
Governance
+ Appointment of new Committee Chair
and new Committee member.
+ Review of the Committee’s terms of
reference.
+ Review of 2022 ESG Report which is
included within this Annual Report.
+ Review of 2022 ESG Committee Report
which is included within this Annual
Report.
Committee responsibilities and activities
The overall responsibilities of the ESG Committee are to assess
the following pillars:
+ Environmental: the Group’s impact on the natural
environment and its adaptation to climate change including
greenhouse gas emissions, energy consumption,
generation and use of renewable energy, biodiversity and
habitat, impact on water resources and the status of water
bodies, pollution, resource efficiency, the reduction and
management of waste, and the environmental impact of
the Group’s supply chain;
+ Social: the Group’s interactions with employees, commercial
counterparties, stakeholders and the communities in which
it operates and the role of the Group in society, workplace
policies (for example, employee relations and engagement,
diversity, non-discrimination and equality of treatment,
health and safety and well-being), ethical procurement, any
social or community projects undertaken by the Group,
social aspects of the supply chain, community and
stakeholder engagement or partnerships; and
+ Governance: the ethical conduct of the Group’s business
including its business ethics policies, code of ethics and
counterparty due diligence.
The other key governance mandates, pursuant to the written
terms of reference of the ESG Committee (which are available
on the Company’s website), are as follows:
+ To ensure that sufficient focus and resource is given to
implementing, monitoring and managing the Company’s
ESG policies and processes and that these remain effective;
+ To ensure that the Board’s ethics are being adhered to and
the Company continues its commitment to issues
concerning social responsibility; and
+ To consider the adequacy of the Group’s ESG policies and
processes by reviewing reports prepared by management
on:
+ review of any key learnings from internal or external
reviews and investigations of any marketing, advertising
campaigns and promotional activities which have had a
significant negative impact on the brand or image of the
Group;
+ diversity in the workplace;
+ security and health and safety in respect of the Group’s
employees and premises;
+ charitable donations and pro bono programmes; and
+ the Company’s impact on the environment.
78 Plus500 Ltd. Annual Report 2022
Dear shareholder
I am privileged to have been appointed as Chair of the
Committee as of June 2022, after serving as a member of the
Committee for over two years now, replacing Daniel King who
completed his maximum nine-year tenure. I would like to thank
Daniel for his tremendous efforts in designing and guiding the
work of the Committee during the past years and for his
endless dedication to ensure that the Committee has a solid
framework from which to evolve.
Accordingly, as the new Chair of the Remuneration Committee,
and on behalf of the Board, I am pleased to present the
Remuneration Committee Report for FY 2022.
Plus500 is a corporate entity incorporated in Israel and is
therefore not legally required to comply with the requirements
applicable to a UK incorporated company. The Directors’
Remuneration Report, which will be put to shareholders’ vote
(as a non-binding advisory vote) at our 2023 AGM, has been
prepared once again with a view to the standards for a UK
company, while making required adjustments in order to
conform with the requirements under the Israeli law pertaining
to remuneration, and best market practice in the Israeli hi-
tech environment.
Our Directors’ Remuneration Report provides a short overview
of remuneration paid in respect of performance in 2022.
In accordance with the provisions of the Companies Law,
shareholders’ approval will be sought for our Remuneration
Policy once every three years or earlier if a change to policy is
Committee attendance in FY 2022
Details of the number of scheduled Committee meetings
and individual attendance at these meetings are set out
in the Committee attendance table below.
Scheduled meetings
eligible to attend
Scheduled meetings
attended
Anne Grim (Chair)
1
3 3 (100%)
Tami Gottlieb 3 3 (100%)
Past members
Sigalia Heifetz
2
3 3 (100%)
Daniel King
3
1 1 (100%)
1. Anne Grim was appointed as Chair of the Committee on
19 June 2022.
2. Sigalia Heifetz stepped down from the Committee on
14 February 2023.
3. Daniel King (previous Chair of the Committee) stepped down from
the Committee (and from the Board) on 19 June 2022.
Prof. Varda Liberman was appointed as a member of the Committee
in February 2023, therefore she is not included in the Committee’s
attendance table in FY 2022.
REPORT OF THE REMUNERATION
COMMITTEE
Report of the Remuneration Committee
Our 2022 Remuneration
Report has further evolved,
as we continue to provide
clearer and more
transparent disclosures
more closely aligned to UK
best practice
Anne Grim
Chair of the Remuneration Committee
79 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Report of the Remuneration Committee continued
Full details of the remuneration payable for 2022 performance
and performance against targets is set out in the Annual
Report on Remuneration. The Remuneration Committee
comprehensively assessed Executive Management’s
performance against these targets and, given Executive
Management’s substantial commitment in leading and
delivering Plus500’s outstanding strategic, operational and
financial performance during FY 2022, determined that these
targets were met in full. Furthermore, the Committee is
comfortable that the remuneration paid for 2022 is aligned to
the strong performance in the year and investor returns,
particularly in the context of a challenging macro-economic
environment and the impact of on-going uncertainty on
international capital markets.
Increase in fees (as of 1 January 2022) for the Chair of the
Board and the Non-Executive Directors
Given the long-standing experience, high calibre and value
creation being delivered by the Chair of the Board and its Non-
Executive Directors, the Remuneration Committee proposed
to increase the remuneration of the Chair of the Board and the
remuneration of each of the Board’s Non-Executive Directors.
As explained by the Remuneration Committee and the Board,
during FY 2021 and Q1 2022, the Group has significantly
expanded its international operations, making an initial entry
in the US for the first time, through two acquisitions, and by
establishing a new operation in Europe through a new licence
in Estonia and in Asia, through an acquisition in Japan. In
addition, the Group is expected to establish further new
operations in additional geographies over the next year and
into the future.
With the expanded, and expanding, global operations of the
Group, additional time, availability and attention is required of
the Non-Executive Directors. The Remuneration Committee
therefore believes the remuneration increase which was
proposed is commensurate with the increased attention and
time required of the Non-Executive Directors. Also, the
proposed level of remuneration was appropriate and in line
with US Non-Executive remuneration, which is relevant as
several of the Board’s Non-Executive Directors are either
based in the US or spend a significant amount of time there.
When proposing the increase in the remuneration of Prof.
Frenkel as Chair of the Board, the Remuneration Committee
took into account Prof. Frenkel’s more than 40 years of
experience in global economics and in leading and advising
major multi-national financial organisations and high-profile
public sector institutions. In particular, the Committee was
minded that Prof. Frenkel has significant, long-standing
experience in the US financial, futures and capital markets,
with a long track record of engaging with regulators and major
government agencies and institutions in the US and around
the world.
Accordingly, and given his significant leadership and
contribution to Board meetings, Prof. Frenkel is proving to be a
significant asset to the Company in crafting its strategic
objectives and advancing the development of its operations.
With all of this in mind, the Remuneration Committee
suggested that the increase in Prof. Frenkel’s remuneration
was appropriate for the level of value that he is providing, and
will continue to provide, for the Group and its shareholders.
required, as was sought in 2021 for the years 2021, 2022 and
2023 and which was approved at the 2021 AGM held on 4 May
2021 with excellent support of over 94% of the votes.
Shareholders will also be aware that as an Israeli company we
are required to obtain shareholder approval to the
remuneration packages for our Executive Directors. If changes
are made to the annual remuneration packages,
shareholders’ approval will be sought.
Our 2022 Remuneration Report has further evolved, as we
continue to provide clearer and more transparent disclosures
more closely aligned to UK best practice and the UK Directors’
Remuneration Reporting Regulations.
Business performance
The Group delivered an excellent operational and financial
performance in FY 2022, delivering further growth and building
on its long-term track record of performance since the IPO in
2013. Plus500 made outstanding progress against its strategic
roadmap this year, with the objective of further developing its
position as a global multi-asset fintech group and in terms of
its operational performance, the Group delivered strong
operational delivery across all key metrics during 2022.
Plus500’s financial performance in FY 2022 was also
exceptional, reinforcing the Group’s financial position,
delivering further outstanding revenue and EBITDA growth,
well ahead of market expectations related to Plus500’s
financial performance at the start of the year, following several
upgrades to these market expectations throughout the year.
2022 operation of policy
2022 was a year of excellent financial and operational
performance and the annual bonus targets were met in full
with bonus payable to David Zruia of $1,531,000 and Elad Even-
Chen of $1,531,000. As a result of their leadership, hard work and
commitment, the Group delivered an excellent operational
and financial performance in FY 2022, well ahead of market
expectations. In addition, Plus500 outperformed against a
number of strategic objectives, including the delivery of the
major milestones:
+ Access to the substantial Japanese retail trading market
achieved, through acquisition of a regulated entity in Japan
+ New regulatory licence obtained in Estonia, to act as an
additional foundation to the Group’s business across Europe
in its OTC product offering
+ New technological retention initiatives developed and
launched, including premium service, demonstrating the
Group’s continued focus on high value customers
+ Launch of ‘+Insights’, Plus500’s big-data, analytical tool
designed to provide its OTC customers with access to real-
time and historical trends
+ Major commercial milestone, with over 24 million worldwide
customers now registered on its trading platforms since
inception
+ Over $270m delivered in shareholder returns through
dividends and share buybacks (compared to over $200m in
FY 2021), which equates to 73% of the Group’s net profits in
FY 2022
+ 33% increase in Plus500’s share price from 1 January 2022 to
31 December 2022
80 Plus500 Ltd. Annual Report 2022
The abovementioned increases in fees for the Chair of the
Board and the Non-Executive Directors were brought for
shareholders approval at the 2022 AGM held on 3 May 2022.
Further details of these proposed changes can be found in the
Notice of the 2022 Annual General Meeting, published on 23
March 2022.
I would like to thank our investors who were supportive and
approved these changes. I am grateful for the engagement,
feedback and support we have received from our
shareholders.
Proposed increase in fees (as of 1 January 2023) for the
Chair of the Board and the Non-Executive Directors
In light of the business performance outlined above, and given
that with the expanded, and expanding, global operations of
the Group, additional time, availability and attention are
required from the Chair of the Board and the other Non-
Executive Directors. Therefore, the Remuneration Committee
proposes to moderately increase the remuneration of Prof.
Frenkel as Chair of the Board and to moderately increase the
remuneration of each of the Board’s Non-Executive Directors,
all effective as of 1 January 2023.
Further details of these proposed changes can be found in the
Notice of the 2023 Annual General Meeting, to be circulated by
the Company to all shareholders in due course.
Rationale for proposed increase in remuneration of Non-
Executive Directors and Chair of the Board
The Remuneration Committee believes the remuneration
enhancements being proposed are commensurate with
the increased attention and time required of the Chair and
the Non-Executive Directors to take account of an expanded
and more globally diversified business. Furthermore, the
Remuneration Committee believes that the enhancements
are appropriate for the level of value that the Chair and
Non-Executive Directors are providing, and will continue to
provide, for the Group and its shareholders. In addition, the
proposed enhancements are aligned with US Non-Executive
remuneration, which is relevant and appropriate, as explained
above.
Next steps
The Remuneration Committee believes that it is in the best
interests of the Company and its shareholders to approve the
resolutions related to the items outlined above at the
Company’s 2023 AGM.
Concluding remarks
Since the 2022 AGM results, the Board engaged with various
shareholder advisory bodies and a number of shareholders,
taking into account their feedback.
The Board always takes the outcome of shareholder votes
seriously and, going forward, will continue its engagement
and dialogue with shareholders and their representatives and
will continue to consider related shareholder feedback, with a
view to implementing this feedback, as appropriate.
All the resolutions put to the 2022 AGM were approved by the
requisite majority with the exception of the non-binding
advisory resolution to approve the Directors’ Remuneration
Report. In addition, two resolutions proposed at the 2022 AGM
had more than 20% of votes cast against them. These
resolutions related to the re-election of one of the Board’s
Independent Non-Executive Directors and an allotment of
shares to the Chair of the Board.
Members of the Board engaged with several shareholders
and shareholder advisory bodies to understand their
perspective on the above-mentioned resolutions, and on the
Group’s overall framework for governance and remuneration.
As a result, the Board believes it has a good understanding of
the rationale regarding the votes cast against and where
appropriate will take these views into consideration in the
Group’s future approach to these areas.
All other resolutions at the AGM were passed by a majority of at
least 80% of votes cast in favour, with a number of these
resolutions relating to remuneration increases of the Chair
and the Independent Non-Executive Directors, as described
above. This support demonstrates shareholders’ overall on-
going recognition of the importance of providing appropriate
incentives to attract and retain high quality individuals to the
Board whose stewardship is helping to drive the value of
Plus500’s business as the Group successfully continues to
deliver against its strategic objectives.
The Board remains fully committed to achieving the highest
governance standards and will continue to engage regularly
with shareholders and to consider their views in its decision-
making.
I look forward to reporting on the Remuneration Committee’s
further progress in next year’s Annual Report.
Anne Grim
Chair of the Remuneration Committee
22 March 2023
Committee composition
The Code recommends a remuneration committee to
consist of at least three members and that all of its
members be Non-Executive Directors, independent in
character and judgement and free from any relationship
or circumstance which may, could or would be likely to, or
appear to, affect their judgement.
The Companies Law requires a remuneration committee
to consist of at least three members, and all of the External
Directors must be members of the committee and
constitute the majority thereof. The remaining members
must qualify to serve as members of the Audit Committee
as defined in the Companies Law and whose
compensation is in accordance with the compensation
requirements applicable to the External Directors. The
Chair of the Remuneration Committee must be an External
Director.
The Remuneration Committee comprises three
Independent Non-Executive Directors: Anne Grim, Tami
Gottlieb and Prof. Varda Liberman (appointed on 14
February 2023, replacing Sigalia Heifetz) and is chaired by
Anne Grim (appointed as chair in June 2022, replacing
Daniel King following his end of tenure). Anne Grim and
Tami Gottlieb are External Directors under the Companies
Law. Details of the skills and experience of the
Remuneration Committee members can be found on
pages 52-55.
81 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
A summary of the major activities and decisions of the
Committee in 2022 is set out below:
Base salary/
service fees
+ Executive Directors’ remuneration
review.
+ Review and approval of Chair’s and
Non-Executive Directors’ fees and
recommendations to the Company’s
shareholders.
Bonus
+ Review of the performance of the
Chief Executive Officer and the
Executive Directors compared to the
targets previously set and approval of
annual bonus awards for 2022 based
on fulfilment of such performance
targets.
Long Term
Incentive Plans
(“LTIPs”)/
Restricted
Share Units
(“RSUs”)
+ Review of Executive Directors’ 2022
LTIP and RSU plans.
+ Review and approval of 2022 RSU
grants to Executive employees.
Governance
+ Review of corporate governance and
determining appropriate levels of
disclosure for the 2022 Directors’
Remuneration Report.
+ Review of 2022 AGM remuneration
report results, and investor and
shareholder advisory bodies’ views
on remuneration.
+ Review of the Committee’s terms of
reference in light of the Code and the
Companies Law.
+ Review of 2022 Remuneration
Committee Report which is included
within this Annual Report.
+ Review of 2022 Directors’
Remuneration Report which is
included within this Annual Report.
Other
+ Review of remuneration consultant
costs and appointment.
The Company Secretary ensures that the Remuneration
Committee fulfils its duties under the Companies Law and its
terms of reference and provides regular updates to the
Remuneration Committee on relevant regulatory
developments in the UK, information on Israeli market trends
and compensation structures on a broader Group level.
Report of the Remuneration Committee continued
Annual report on remuneration 2022
This section of the Annual Report describes the
implementation of the Terms of Reference, Israeli law
requirements and the provisions of the Code.
Committee responsibilities and activities
The Remuneration Committee meets not less than twice a
year and at such other times as required. The
Remuneration Committee has responsibility for
determining, within the agreed terms of reference, the
Companies Law provisions and subject to the
Remuneration Policy of the Group, the Group’s policy on
the remuneration packages of the Company’s Chief
Executive Officer, Chief Financial Officer, the Chair of the
Board and the other Non-Executive Directors, the
Company Secretary and other senior Executives
determined by the Committee.
The other key governance mandates of the Committee
pursuant to the Companies Law and the written terms of
reference of the Remuneration Committee (which are
available on the Company’s website) are as follows:
+ Reviewing the remuneration policy and approving a
remuneration policy at least once in every three years;
+ In determining remuneration policies for the Company’s
senior management and/or individual remuneration
packages of each Executive Director, the Chair of the
Board and other designated senior Executives, the
Remuneration Committee is required to give regard to
the relevant legal and regulatory requirements, the
provisions of the Companies Law, the provisions and
recommendations of the Code and associated
guidance;
+ Approving and determining the targets for any
performance-related pay schemes; and
+ Reviewing the design of all share incentive plans for
approval by the Board and (if required or deemed
appropriate) the shareholders.
82 Plus500 Ltd. Annual Report 2022
Remuneration policy
Pursuant to the Companies Law, all public Israeli companies,
including companies whose shares are only publicly listed
outside of Israel, such as Plus500, are required to adopt a
written remuneration policy for their Board members and
Executives, which addresses certain items prescribed by the
Companies Law. The adoption, amendment and restatement
of the policy is to be recommended by the Remuneration
Committee and approved by the Board and the Company’s
shareholders.
The Remuneration Policy was approved at the 2021 AGM on 4
May 2021, after a thorough and comprehensive review
undertaken by the Committee, which included consultation
with major shareholders and engagement with shareholder
advisory bodies.
The Remuneration Policy and operation of policy for the years
2021, 2022 and 2023, provides some far-reaching changes
from the previous policy and operation to ensure that we are
making significant strides to align to the UK norm.
We have not made any changes to the Remuneration Policy
that was approved at the 2021 AGM. Further details of the
approved Remuneration Policy are included within our 2020
Annual Report, which can be found on the Company’s website.
In accordance with the provisions of the Companies Law,
shareholders’ approval will be sought for our Remuneration
Policy at least once in every three years.
Stakeholder engagement
Employees, customers and suppliers
The Board regularly communicates with and receives
feedback from the Group’s employees through a variety of
channels. Steve Baldwin, as the designated Non-Executive
Director dedicated to workforce engagement, meets on a
yearly basis with the Group’s workforce and at such meetings
employees have the opportunity to share their views, including
on executive and employee remuneration.
In addition, employees can contact Steve Baldwin directly on
matters they wish to discuss with him or with the Board. Steve
Baldwin also regularly communicates with the senior
management who have connections with other stakeholders
of the Company, such as customers and suppliers. Steve
reports any key messages deriving from such conversations
to the Board and ensures that such messages are considered
as part of the Board’s decision-making process. Plus500 holds
regular employee workshops and briefings on a variety of
topics and conducts round table discussions with its
employees worldwide.
The Company seeks to consider and act on employee
feedback and is committed to ensuring that its remuneration
structures are supported by its employees. The Company is
also continually working to develop best practice in line with
the Code and is considering whether additional channels of
employee communication are required in order to better
develop employee engagement and foster stronger
connections with its workforce.
Shareholders
The Chair of the Board and the Chair of the Remuneration
Committee are in regular communication with shareholders
of the Company on a variety of matters and are grateful for
shareholders’ engagement and feedback.
As mentioned, in developing the Company’s Remuneration
Policy, which was approved by over 94% of shareholders’ votes
cast at the 2021 AGM, the Committee consulted with major
shareholders and engaged with other shareholder advisory
bodies. Shareholders have also understood that as the
Company is incorporated under the laws of the State of Israel,
there is a small number of matters that are not fully aligned
with UK investor expectations.
The Board always takes the outcome of shareholder votes
seriously and, going forward, will continue its engagement
and dialogue with shareholders and their representatives and
will continue to consider related shareholder feedback, with a
view to implementing this feedback, as appropriate.
Approach to recruitment and remuneration of Executive
Directors
Plus500 believes that strong, effective leadership is
fundamental to its continued growth and success in the future.
This requires the ability to attract, retain, reward and motivate
highly-skilled Executive Directors, with the competencies
needed to excel in a rapidly changing marketplace and to
continually motivate their employees.
When setting remuneration packages for new Executive
Directors, pay will be set in line with the Remuneration Policy of
the Company. Several factors will be considered, including: the
geography in which the role competes or is recruited from; the
candidate’s experience and skills; the remuneration levels of
other Executive Directors and colleagues in peer companies in
Israel and in the international market; market standards and
norms in the UK and the international markets.
If necessary, Executive Directors may be provided with
contributions towards relocation expenses, housing, school
fees etc., all in line with the practices within the relocated
countries and the level of executive seniority.
Non-Executive Directors
Non-Executive Directors are appointed for a one-year term
and are subject to re-election at each AGM. External Directors
are appointed by shareholders at an EGM or AGM for a three-
year term commencing on the date of their appointment by
the shareholders. This term may be extended for up to two
additional three-year terms subject to re-election by
shareholders at an EGM or AGM. The term of office can be
terminated by the Non-Executive Director with two months’
written notice, or by the Company with immediate effect if the
Non-Executive Director is not re-elected or is otherwise
removed from office in accordance with the Articles.
Notwithstanding, External Directors’ service may be
terminated by the Company only in such circumstances and
manner provided under the Companies Law. Upon termination
no additional payments are due.
83 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
The table below details the date and period of appointment of each Non-Executive Director presiding
NAME
POSITION
DATE O F
APPOINTMENT
TO THE BOARD
OF DIRECTORS
DATE O F
RE-APPOINTMENT
TO THE BOARD
OF DIRECTORS
PERIOD OF
APPOINTMENT
Prof. Jacob A. Frenkel
Independent Non-Executive Director and
Chair
May 2021 May 2022 1 year
Anne Grim
Senior Independent Non-Executive Direc-
tor and External Director
September
2020
N/A 3 years
Steve Baldwin
Independent Non-Executive Director June 2017 May 2022 1 year
Sigalia Heifetz
Independent Non-Executive Director February 2021 May 2022 1 year
Tami Gottlieb
Independent Non-Executive Director and
External Director
March 2021 N/A 3 years
Prof. Varda Liberman
Independent Non-Executive Director March 2022 May 2022 1 year
The table below details the date and period of appointment of each Executive Director presiding
NAME
POSITION
DATE O F
APPOINTMENT
TO THE BOARD
OF DIRECTORS
DATE O F
RE-APPOINTMENT
TO THE BOARD
OF DIRECTORS
PERIOD OF
APPOINTMENT
David Zruia Executive Director April 2020 May 2022 1 year
Elad Even-Chen Executive Director June 2016 May 2022 1 year
Report of the Remuneration Committee continued
84 Plus500 Ltd. Annual Report 2022
Introduction
This report sets out information about the remuneration of the Board members of the Company, for the year ended 31 December
2022.
Audited information – Directors’ remuneration – 1 January 2022 to 31 December 2022
Single figure of remuneration
The detailed emoluments received by the Executive and Non-Executive Directors during the year ended 31 December 2022 are
detailed below.
The information provided in the section and accompanying notes has been audited by Kesselman & Kesselman, a member
firm of PricewaterhouseCoopers International Limited.
BASE SALARY/
SERVICE FEES
1
OTHER
EXPENSES
2
TOTAL
FIXED PAY
ANNUAL
BONUS LTIPs/RSUs
SHARE
APPRECIATION
RIGHTS
TOTAL
VARIABLE PAY TOTAL
(US$000) 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
Executive
Directors
David Zruia 639 636 143 220 782 856 1,531 1,590 231 – 1,842 – 3,604 1,590 4,386 2,446
Elad Even-Chen 639 636 143 142 782 778 1,531 1,590 289 265 2,093 – 3,913 1,855 4,695 2,633
Non-Executive
Directors
Jacob A. Frenkel
3
(Chair) 705 472 – – 705 472 – – – – – – – – 705 472
Anne Grim 124 100 – – 124 100 – – – – – – – – 124 100
Steve Baldwin 124 103 – – 124 103 – – – – – – – – 124 103
Tami Gottlieb
4
124 84 – – 124 84 – – – – – – – – 124 84
Sigalia Heifetz
5
124 98 – – 124 98 – – – – – – – – 124 98
Varda Liberman
6
97 N/A 97 N/A 97 N/A
Past Non-Executive
Director
Daniel King
7
62 103 – – 62 103 – – – – – – – – 62 103
1. The remuneration terms comprised of a salary for David Zruia and service contract fees for Elad Even-Chen (the “base service fees”).
2. Includes social and other contractual-related expenses.
3. Prof. Jacob A. Frenkel was appointed as a Non-Executive Director and Chair of the Board at the 2021 AGM held on 4 May 2021.
4. Tami Gottlieb was appointed as a Non-Executive Director and External Director on 16 March 2021.
5. Sigalia Heifetz was appointed as a Non-Executive Director on 4 February 2021.
6. Prof. Varda Liberman was appointed as a Non-Executive Director on 18 March 2022.
7. Daniel King stepped down from the Board on 19 June 2022.
General note: In line with the UK reporting regulations, LTIP and RSU awards shall be reported in the year that the performance period ends with the value of
the award on grant date.
ANNUAL REPORT ON
REMUNERATION 2022
Directors’ Remuneration Report
85 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Directors’ Remuneration Report continued
Commentary on the single figure table
Base salary, base service fees and social and other contractual related expenses
David Zruia’s base salary in 2022 was ILS 2,060,000 as approved by the AGM on 4 May 2021. Elad Even-Chen’s base service fees in
2022 was ILS 2,060,000 as approved by the AGM on 4 May 2021.
Annual Bonus
The 2022 annual bonus for the Executive Directors was determined based on the achievement of the performance measures
and targets set out below:
FINANCIAL
METRICS WEIGHTING OBJECTIVES PERFORMANCE
ACHIEVEMENT
(% OF MAXIMUM)
EPS 40% EPS target to be set according to stretched external
independent consensus. Achievement of an EPS
growth rate. Target EPS threshold of $1.91. Minimum
threshold is 15% lower EPS from the target threshold
EPS and the maximum payout is made for reaching
a 15% increase from the target threshold, calculated
on a linear basis.
Actual basic EPS for
FY 2022 is $3.81
100%
Revenue 20% Revenue target to be set according to stretched
external independent consensus. Achievement
of revenue growth rate. Target revenue threshold
of $567.9m. Minimum threshold is 15% lower
revenue from the target threshold revenue and
the maximum payout is made for reaching a 15%
increase from the target threshold, calculated on a
linear basis.
Actual Revenue for
FY 2022 is $832.6m
100%
Total 60% 100%
NON-FINANCIAL
METRICS WEIGHTING OBJECTIVES PERFORMANCE
ACHIEVEMENT
(% OF MAXIMUM)
Operational 40% Achievement of operational targets comprise
three equally weighted elements: Customers and
Systems, Operations and Risk & Regulation
Parameters achieved for
2022
100%
Total 40% 100%
The Remuneration Committee comprehensively assessed Executive Management’s performance against these stretching
targets, which were set before the start of FY 2022. Given Executive Management’s substantial commitment in leading and
delivering Plus500’s outstanding strategic, operational and financial performance during FY 2022, determined that these
targets were met in full. Further details of the financial and non-financial KPIs are as follows:
Financial KPIs: the EPS and revenue targets applying to the performance-related Annual Bonus are reviewed annually, and the
Remuneration Committee uses external market consensus as a basis to the threshold targets. This is the external market
consensus of various analysts which cover the Company in their views towards the Company’s performance. The Remuneration
Committee believes that using the external market consensus as a basis to the threshold target allows for alignment between
remuneration paid to Executive Directors and the market expectations. Thus, the Committee feels comfortable that such
independent measures are sufficiently stretching.
The target performance related to the Annual Bonus requires meaningful improvement on the previous year’s outcome, and
for financial targets are typically in line with the top end of external market expectations. Plus500 FY 2021 EPS target of $1.98,
which was based on external market expectations, was driven by the significant positive impact of the COVID19 situation on the
business in FY 2020. Plus500 FY 2022 EPS target of $1.91, which was also based on external market expectations, took into
consideration an assumption of the business coming back in FY 2022 to the run rate of its ordinary course of business, plus a
stretched growth element. Therefore, the FY 2022 EPS target of $1.91, was stretched and meaningfully higher than that of the
previous year. Additionally, the actual outcome of FY 2022 EPS was meaningfully higher than the targeted external market
expectations, as a result of the executive management’s successful deployment against the Group’s strategic roadmap.
EPS is a primary KPI and important underlying measure for Plus500, which helps investors compare the Group’s performance to
its peer group and the wider market. It takes into account the underlying performance, including revenue and profitability, of
the business. Therefore, the Remuneration Committee believes EPS should be an important element in both the Annual Bonus
and LTIP awards for executive management.
86 Plus500 Ltd. Annual Report 2022
Non-financial KPIs: the operational KPIs outlined in the table above consist of:
+ Customer Experience and Systems Availability, measured by Customer Satisfaction Levels. The Group puts a great deal of
focus on customer care and the Board believes that in order to enable continued future growth for Plus500, there should be
an on-going focus on Customer Satisfaction levels, and customer engagement, measured quantitatively;
+ Development and implementation of new technologies to enable the expansion of the localised payment abilities, measured
by level of functioning of various technology-based operational systems. In FY 2022, various payment methods and other
technological solutions were developed internally to enable such new capabilities.; and
+ Risk and Regulation, measured by KPIs related to the regulatory framework. As a Group which has various highly regulated
wholly-owned subsidiaries, there are thresholds to be met in order to confirm there are appropriate and clear outcomes to
the risk and regulatory framework. In FY 2022, such thresholds were fully met.
Further specific details of these targets and performance against them are not disclosed as the Board believes they are
commercially sensitive. They will remain market sensitive because they are an integral part of our on-going business operations.
The Remuneration Committee has provided as much information as it is able to, given the nature of the objectives, so that
investors can be comfortable that the Remuneration Committee has used a thorough approach in setting the objectives and
targets and measuring the outcome.
Based on the performance against these targets described above the Committee agreed the following 2022 bonus awards
based on 100% of the maximum opportunity to present achievements and meeting targets.
2022 bonus awards (US$000)
CASH BONUS
BONUS
ALLOCATED
IN SHARES
TOTAL
ANNUAL BONUS
MAXIMUM OPPORTUNITY
AS PERCENTAGE OF ANNUAL
SALARY/BASE
SERVICE FEES*
David Zruia 1,021 510 1,531 250%
Elad Even-Chen 1,021 510 1,531 250%
* Percentage calculation based on annual employment/contractual agreements in ILS.
An amount equal to 33.33% of the Annual Bonus achieved was paid by way of allotment of ordinary shares of the Company on
31 December 2022. The number of ordinary shares allotted on the payment date was calculated based on the ordinary share
price at 2 January 2022, as adjusted for shareholder returns. The allotted ordinary shares are subject to a post vesting holding
period.
Legacy Share Appreciation Rights (“SARs”)
SARs are a deferred cash settled award subject to providing continued service or employment over long-term periods and tied
to the long-term performance of the Company’s ordinary shares.
In respect of FY 2020 SARs granted on 31 December 2019, the remuneration package to David Zruia included SARs granted in
December 2019 to be vested after three years in December 2022. The grant was fully vested on 31 December 2022 in the amount
of $1,842,000. The remuneration package to Elad Even-Chen included SARs granted in December 2019 to be vested after three
years in December 2022. The grant was fully vested on 31 December 2022 in the amount of $2,093,000.
In line with the rigorous changes which were implemented as part of the FY 2021 Remuneration Policy, it was agreed that SARs
would no longer be awarded to Executive Directors. Instead, to ensure the policy’s approach in relation to executive remuneration
was fully aligned to UK best practice, Executive Directors would be awarded Long Term Incentive Plans, with long-term lock-up
periods. Consequently, as of FY 2021 and FY 2022 there are no new SARs entitlements for Executive Directors.
87 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
2022 LTIP/RSUs Awards
Scheme interests awarded during the year ending 31 December 2022
Executive Directors were granted Long Term Incentive Plan (“LTIP”) and Restricted Share Units (“RSUs”) grants in respect of 2022
which will vest after three years to the extent performance targets and KPIs have been achieved, as summarised in the table
below.
TARGETS
PERFORMANCE MEASURE WEIGHTING THRESHOLD (25% OF MAX) MAXIMUM (100% OF MAX)
Relative TSR vs bespoke
group
20% Median Median plus 10% p.a.
Relative TSR vs FTSE 250
10% Median Upper Quartile
EPS
30% Subject to achieving EPS target to be set according to
stretched external independent consensus
Strategic
20% Subject to achieving strategic objectives,
as set by the Board and related to growth through M&A,
new products and new markets
Operational
20% Subject to achieving operational objectives,
as set by the Board and related to customer growth
and people objectives
Further details of a number of these performance measures outlined above are as follows:
EPS: the EPS target uses market consensus as a basis to the threshold targets. This is the external market consensus of various
analysts which cover the Company in their views towards the Company’s performance. The Remuneration Committee believes
that using the external market consensus as a basis to the EPS target allows for alignment between remuneration paid to
Executive Directors and the external market expectations. Thus, the Committee feels comfortable that such independent
measures are sufficiently stretching. The target performance requires meaningful improvement, and financial targets are
typically in line with the top end of external market expectations.
Operational: the operational objectives consist of integration of new business, regulation of new products, customer service
and people. These objectives are measured by such factors as:
+ ESG targets, such as gender diversity, aligned to the Group’s Equality, Diversity and Inclusion Policy. Measurable elements are
in place in relation to gender diversity; and
+ a clear approach to recruitment, aligned to the Group’s strategy in this area.
Strategic: the strategic objectives are based on development of the business as a global multi-asset fintech group and consist
of launching new products and entering new geographic markets, which was achieved on a number of dimensions in FY 2022,
including:
+ acquisition in Japan, including sign-off and closing of the acquisition transaction, developing and implementing an
integration plan;
+ development of US business, including implementing an operational integration plan through development of new
proprietary technologies such as the ‘TradeSniper’ platform for the US futures retail market and the establishment of a new
B2B line of business for the institutional US futures market;
+ achievement of new regulatory licence and establishment of new subsidiary in Estonia;
+ plans in place for establishment of subsidiary in UAE (with regulatory licence obtained and operational in Q1 2023);
+ launch of a new mobile share dealing platform, ‘Plus500 Invest’, across Europe; and
+ launch of ‘+Insights’, Plus500’s proprietary new big-data analytic tool.
The exact KPIs for the LTIP strategic and operational metrics remain commercially sensitive at this time and/or contain or are
based upon data that is not otherwise included in the Company’s market guidance (such as the Group’s expected profitability),
and therefore will be retrospectively disclosed within the Annual Report in the Remuneration Report with performance against
them. The TSR bespoke group companies are also considered to be commercially sensitive and will be retrospectively disclosed
with performance against the targets in the annual audited accounts in the Remuneration Report with performance against
them.
Directors’ Remuneration Report continued
88 Plus500 Ltd. Annual Report 2022
The details for the LTIPs and RSUs awards granted to each Executive Director are shown below.
GRANT DATE
NUMBER OF
SHARES GRANTED
FACE VALUE OF
THE AWARD (USD) VESTING DATE
MAXIMUM OPPORTUNITY
AS PERCENTAGE OF
ANNUAL SALARY/BASE
SERVICE FEES
1
David Zruia 2 January 2022 94,910 1,653,662 31 December 2024 250%
Elad Even-Chen 2 January 2022 94,910 1,653,662 31 December 2024 250%
1. Percentage calculation based on annual amounts of the contractual agreements in ILS.
General note: Face value of the award and the number of shares granted on grant date are calculated with reference to share price of 1,291 GBP pence and
FX rate USD/ILS of 3.114.
The ordinary shares allotted on the vesting date, which are subject to a lock-up period, shall be subject to a two-year lock-up
beginning on the vesting date.
On the vesting date the Company shall allot to the employee or service contractor, ordinary shares, subject to the service
condition and achieving specific KPIs as described in the table above for each grant.
The number of ordinary shares allotted on the vesting date shall be calculated based on the ordinary share price at grant date
as specified in the table above for each plan, as adjusted for shareholder returns. An amount equal to the applicable tax
liability connected to the LTIPs, RSUs, SARs and annual bonus deferred in shares plans shall be added by way of gross-up and be
paid in cash to fund the tax liability. The allotted ordinary shares will be transferred out of the treasury shares of the Company.
The 2020 LTIP and RSU Grants were subject to service condition as well as additional performance targets and KPIs. The 2020 LTIP
and RSU Grants vested on 31 December 2022 and the Company issued 82,824 of its treasury shares.
FINANCIAL
METRICS WEIGHTING OBJECTIVES PERFORMANCE
ACHIEVEMENT
(% OF MAXIMUM)
EPS 40% Subject to achieving the three-year compounded
annual EPS growth rate and calculated on a linear
basis, with 30 per cent. payable upon achievement
of 5 per cent. compounded annual EPS growth rate
and 100 per cent. payable upon achievement of 12
per cent. compounded annual EPS growth rate
Actual basic EPS for
FY 2022 is $3.81, which
represents 182% growth
100%
TSR 40% Subject to achieving the three-year FTSE 250 TSR
target and calculated on a linear basis, with 30
per cent. Payable upon achievement of median
TSR for FTSE 250 and 100 per cent. Payable upon
achievement of upper quartile TSR for FTSE 250
Actual TSR of 152%> FTSE
250 TSR upper quartile of
19%
100%
Total 80% 100%
NON-FINANCIAL
METRICS WEIGHTING OBJECTIVES PERFORMANCE
ACHIEVEMENT
(% OF MAXIMUM)
HR 20% Achievement against Board approved strategic
plan, covering the following areas:
+ Employee attrition rates
+ Development of the R&D team
Parameters achieved for
the period
100%
Total 20% 100%
The Committee carefully assessed performance against objectives set for the LTIP and RSU Grants and noting exceptionally
strong performance against all of the objectives set, determined full achievement of the objectives.
The HR objectives are based on development of the R&D team and employee attrition rates. In line with the Company’s plan to
incrementally invest approximately $50m in its R&D capability between FY 2021 and FY 2023, the Company continues to invest in
product development to further deepen customer engagement, including through continued recruitment at the Company’s
R&D centres in Israel. The Group had a great success to retain its employees and to recruit new employees in order to support its
strategic roadmap and as employee welfare and development is a key priority for the Group.
.
89 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Directors’ Remuneration Report continued
Payments to past Director and payments for loss of office
Non-Executive Director Daniel King stepped down from the Board on 19 June 2022. He was not entitled to and subsequently did
not receive any payment for Loss of Office.
All amounts paid are set out in the single figure of remuneration table.
Further information on 2022 remuneration
Directors’ shareholdings and share plan interests
Summary of Directors’ shareholdings and share plan interests as at 31 December 2022
1
.
OUTSTANDING SCHEME
INTERESTS AS AT 31/12/2022 BENEFICIAL OWNERSHIP IN SHARES
SUBJECT TO
PERFORMANCE
CONDITIONS
WITHOUT
PERFORMANCE
CONDITIONS
AS AT
1 JANUARY
2022
AS AT
31 DECEMBER
2022
2
SHAREHOLDING
REQUIREMENT
(% OF SALARY/BASE
SERVICE FEES)
CURRENT SHAREHOLDING
AS AT 31/12/2022
(% OF SALARY/BASE SERVICE FEES)
Executive Directors
David Zruia 175,766 – 46,031 101,748 200% 379%
Elad Even-Chen
3
223,107 20,078 184,075 321,074 200% 1,196%
Non-Executive Directors
Jacob A. Frenkel – – 5,424 19,589 – –
Anne Grim – – – – – –
Steve Baldwin – – – – – –
Tami Gottlieb – – – 553 – –
Sigalia Heifetz – – – – – –
Varda Liberman – – N/A
4
–
Past Non-Executive Director
Daniel King – – 30,993 30,993
5
– –
As of 31 December 2022, none of the presiding Board members held more than 0.34% in the Company’s issued share capital.
1. As disclosed above, none of the Directors has any interest in the share capital of the Company or of any of its subsidiaries nor persons connected to the
Directors (within the meaning of s.252 of the Companies Act) have any such interest, whether beneficial or non-beneficial.
2. As at 31 December 2022 and up to the date of this Annual Report.
3. The shares are registered in the name of Elad Even-Chen Consulting Services Ltd. or Elad Even-Chen.
4. Varda Liberman was appointed as a Non-Executive Director on 18 March 2022.
5. Daniel King shareholding as at date when stepped down from the Board on 19 June 2022.
General notes:
(a) Outstanding scheme interest as at 31 December 2022 include 2022 and 2021 LTIP/RSU awards that have not vested, and vested deferred bonus for 2020.
(b) Beneficial ownership in shares include all share plan interests together with any holdings of ordinary shares.
(c) Current shareholding as at 31 December 2022 as a % of salary/base service fees were calculated based on share price as at 31 December 2022 and FX
GBP/ILS as of that date.
Executive Director’s service contract
Elad Even-Chen, an Executive Director, provides his consulting services to the Company pursuant to a service contract.
The terms of his service contract are summarised below.
Elad Even-Chen – Chief Financial Officer
The consulting services of Elad Even-Chen are provided to the Company through Elad Even-Chen Consulting Services Ltd.,
pursuant to the service contract entered into by the parties. Elad Even-Chen Consulting Services Ltd. is also entitled to
participate in a bonus, legacy SAR entitlements, LTIP schemes and other contractual-related expenses on terms decided by the
Remuneration Committee for specific projects provided by the consultant.
90 Plus500 Ltd. Annual Report 2022
Performance graph and table
Plus500 was admitted to the Alternative Investment Market of the London Stock Exchange on 24 July 2013. Following a period of
sustained growth, the Company applied for Admission to the Main Market which became effective on 26 June 2018.
The chart below shows the TSR performance of £100 invested in Plus500 at IPO vs performance of the FTSE All Share index. As part
of the Company’s continued commitment to strengthen corporate governance, the reporting of Directors’ remuneration in
2022 is being aligned to a greater extent with the regulations applicable to a UK incorporated company. This disclosure will be
built up over the coming years in line with these requirements.
TSR performance of £100 invested in Plus500 at IPO vs performance of the FTSE All-Share index
0
500
1000
1500
2000
2500
3000
3500
4000
24 Jul
2013
31 Dec
2013
31 Dec
2014
31 Dec
2015
31 Dec
2016
31 Dec
2017
31 Dec
2018
31 Dec
2019
31 Dec
2020
31 Dec
2021
31 Dec
2022
Plus500
FTSE AllShare index
2022
CEO single figure total remuneration ($000s) 4,386
Annual bonus achieved for 2022 (as % of maximum opportunity) 100%
Relative importance of the spend on pay
The following table sets out the change in shareholder returns and overall spend on pay in the years ended 31 December 2022
and 2021.
US$ IN MILLIONS 2022 2021 PERCENTAGE CHANGE
Total gross employee and other related expenses pay 80.9 58.9 37%
Dividends 119.9 144.9 (17)%
Share buybacks 138.8 64.9 114%
91 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Directors’ Remuneration Report continued
Non-Executive Directors’ letters of appointment
On their initial appointment, each of the Non-Executive Directors (who are not External Directors) signed a letter of appointment
with the Company, for an initial period commencing upon the date of their appointment by the Board and ending on the date
of the next AGM (and with respect to External Directors – ending on the date which is three years from the date of their
appointment’s approval by the Company’s shareholders at an AGM/EGM).
The letters of appointment of Prof. Jacob A. Frenkel, Steve Baldwin, Sigalia Heifetz and Prof. Varda Liberman as Non-Executive
Directors require them to retire and be subject to re-election at each Annual General Meeting in accordance with Provision 18 of
the Code. The letters have been drafted such that renewed appointment will not necessitate a new letter of appointment. The
appointments of Prof. Jacob A. Frenkel, Steve Baldwin, Sigalia Heifetz and Prof. Varda Liberman can be terminated by the Non-
Executive Director with two months’ written notice, or by the Company with immediate effect if the Non-Executive Director is not
re-elected or is otherwise removed from office in accordance with the Articles.
As required under, and subject to the Companies Law, the appointments of Anne Grim and Tami Gottlieb as External Directors
are for a period of three years from the date of appointment (which may be extended for up to two additional three-year
terms). Daniel King was re-elected for a third and final three-year term effective from the 2019 AGM held in June 2019.
Consequently, his nine-year term ended in June 2022. Anne Grim was elected for her first three-year term effective from the
2020 AGM held in September 2020. Tami Gottlieb was elected for her first three-year term effective from the 2021 EGM held in
March 2021.
Each Non-Executive Director is expected to commit to a minimum of 24 days per year in fulfilling their duties as a director of the
Company.
Other than the External Directors, there are no existing or proposed service contracts or consultancy agreements between any
of the Directors and the Company which cannot be terminated by the Company within 12 months without payment of
compensation.
Copies of the letters of appointment of the Chair and the other Non-Executive Directors of the Company are available for
inspection at the Company’s registered office during normal business hours.
The Chair and Non-Executive Directors do not participate in any long-term incentive or annual bonus schemes, nor do they
accrue any pension entitlement. The Chair’s and Non-Executive Directors’ current remuneration is as detailed in the 2022 AGM
Notice as published on 23 March 2022 and as approved by shareholders at the 2022 AGM held on 3 May 2022.
In addition, there are more stringent regulations around the exact roles of Non-Executive Directors. The Audit and Remuneration
Committees’ Chair must be External Directors who once appointed serve for three years (which may be extended for up to two
additional three year terms). However, they are then restricted from becoming the Chair of the Board or holding any paid role at
the Company for two years after they step down from the Board.
External board appointments
Where Board approval is given for a Board member to accept an outside non-executive directorship, the individual is entitled to
retain any fees received. The Board assesses and confirms that such appointment will not have any material impact on the
performance of the Director, and will not affect the Director’s commitments and duties as a Director of the Company.
Below are the details of external Board memberships of the Company’s Non-Executive Directors, in publicly listed companies,
as of the date of this Annual Report:
Steve Baldwin is currently Chair of TruFin plc and a Non-Executive Director of The Edinburgh Investment Trust PLC.
Prof. Jacob A. Frenkel is currently the Chair of BrainStorm Cell Therapeutics Inc., a NASDAQ publicly listed biotechnology
company.
Anne Grim is currently a Non-Executive Director of Metro Bank PLC and Insight Investment Management Ltd. (subsidiary of Bank
of New York Mellon, a NYSE publicly listed company).
Sigalia Heifetz is currently a Non-Executive Director of RHI Magnesita N.V, Clal Biotechnology Industries Ltd, Maman – Cargo
Terminals and Handling Ltd. and Tamar Petroleum Ltd.
Tami Gottlieb is currently an External Director of Bank Leumi Le-Israel, an External Director of Extell Limited, an Independent
Director of Novo-log (Pharm-Up 1966) Ltd. and a Non-Executive Director of Emilia Development (O.F.G) Ltd.
Prof. Varda Liberman is currently an External Director of Cellcom Israel Ltd.
92 Plus500 Ltd. Annual Report 2022
Non-Executive Director fees
The current annual fees for our presiding Non-Executive Directors are as follows:
NAME ROLE FEE
Jacob A. Frenkel Chair $705,000
Anne Grim NED & SID, External Director $124,000
Tami Gottlieb NED, External Director $124,000
Steve Baldwin NED $124,000
Sigalia Heifetz NED $124,000
Varda Liberman NED $124,000
For further details with respect to the structure of the remuneration paid to our Chair, please refer to our 2022 AGM Notice
published on 23 March 2022.
External advisors
In 2022, the Committee appointed Ernst & Young Global Limited as an independent advisor to carry out a detailed benchmarking
exercise in relation to an increase in the remuneration of Prof. Jacob A. Frenkel as an Independent Non-Executive Director and
Chair of the Board and in relation to an increase in the remuneration of the other Independent Non-Executive Directors. These
increases were voted on at the Company’s 2022 AGM and received shareholders’ support. The Remuneration Committee is
satisfied that the advice provided by EY in relation to these remuneration matters is objective and independent.
In Q1 2023, the Committee appointed Pearl Meyer and Partners, LLC (“Pearl Meyer”) as an independent advisor to carry out a
detailed benchmarking exercise in relation to further evolving the Company’s remuneration disclosures, including by further
enhancing transparency and aligning them with UK best practice and shareholders’ expectations. This will include adoption of
a new Remuneration Policy for the years 2024-2026, and addressing other remuneration matters. Alongside the appointment
of Pearl Meyer, the Company also worked with a compensation governance advisory firm in this regard. These remuneration
matters will be voted on at the Company’s 2023 AGM. The Remuneration Committee is satisfied that the advice provided by
Pearl Meyer in relation to the remuneration matters is objective and independent.
Statement of voting on remuneration at 2022 annual general meeting
The table below shows votes cast by proxy at the AGM held on 3 May 2022 in respect of the Directors’ remuneration.
AGM RESOLUTIONS FOR % VOTES CAST AGAINST % VOTES CAST VOTE WITHHELD
Approve increase in fees to Anne Grim 50,067,752 82.2 10,842,765 17.8 5,000
Approve increase in fees to Tami Gottlieb 50,067,752 82.2 10,842,765 17.8 5,000
Approve increase in fees to Daniel King 50,067,752 82.2 10,842,765 17.8 5,000
Approve increase in fees to Steve Baldwin 50,067,752 82.2 10,842,765 17.8 5,000
Approve increase in fees to Sigalia Heifetz 50,067,752 82.2 10,842,765 17.8 5,000
Approve fees to Varda Liberman 50,067,752 82.2 10,842,765 17.8 5,000
Approve increase in the remuneration of
Jacob A. Frenkel 51,112,544 83.91 9,797,973 16.09 5,000
Allotment of shares to Jacob A. Frenkel 45,361,405 74.47 15,554,112 25.53 –
Advisory vote – Approve the Directors’
Remuneration Report 27,480,108 45.12 33,430,409 54.88 5,000
The following list shows the remuneration of the Company’s six most highly compensated executives in 2022 (including two
Executive Directors): Elad Even-Chen* US$ 4,695,306; David Zruia* US$ 4,386,109; Nir Zatz US$ 3,172,604; Alon Cohen Naznin US$
1,413,668; Al Yaros US$ 1,303,114; Dani Magner US$ 1,120,429. (*For further disclosure refer to the single table on the Remuneration
Report).
93 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Directors’ Remuneration Report continued
Implementation of policy in 2023
2023 Executive Directors’ remuneration
During the past couple of years, the Remuneration Committee has continued its efforts to modify the remuneration
arrangements of the Executive Directors to better align executive compensation with UK governance standards followed by
Main Market-listed companies, and move further towards a structure in line with investor expectations and developments in
best practice. The remuneration for Executive Directors for FY 2023 remains the same as it was in FY 2022.
The Company’s remuneration policy was approved by the shareholders for the years FY 2021, FY 2022 and FY 2023 at the 2021
AGM and received over 94% approval. During FY 2023, a new Remuneration Policy for the years FY 2024, FY 2025 and FY 2026, will
be brought for approval by shareholders. This proposed policy will include additional enhancements, in line with UK best
practice.
This report has been approved by the Board of Directors of Plus500 Limited.
Signed on behalf of the Board
Anne Grim
Chair of the Remuneration Committee
22 March 2023
94 Plus500 Ltd. Annual Report 2022
The Directors of Plus500 present their report for the year ended 31 December 2022. The Directors believe that the requisite
components of this report are set out elsewhere in this Annual Report and/or on the Company’s website (www.plus500.com).
The table below sets out where the necessary disclosure can be found.
Directors
Directors that have served during the year and summaries of the current Directors’ key
skills and experience are set out on pages 52-55 and on page 65.
Results and shareholder
returns
Results for the year ended 31 December 2022 are set out in the Financial and Business
Review on pages 38-40 and the Consolidated Statement of Comprehensive Income on
page 106. Information regarding the final and special dividends can be found in the
Financial and Business Review on page 40. Dividend payments made during the year
ended 31 December 2022 can be found in the notes to the Consolidated Financial
Statements on page 124. During FY 2022, the Company executed its existing share buyback
programmes, with 6,943,359 ordinary shares purchased during the year, amounting to a
total of $138.8m, at an average share price of £16.27.
Articles of Association
The Company’s full Articles of Association can be found on the Company’s website.
https://cdn.plus500.com/media/Investors/ConstitutionalDocuments/ArticlesOfAssociation.pdf
Any amendments made to the Articles of Association may be made by a special resolution
of shareholders.
Share Capital
Details of the Company’s share capital are set out in note 22 to the Consolidated Financial
Statements on page 126. At the close of business on 21 March 2023, the Company had
91,731,052 ordinary shares in issue, and an additional 23,157,325 ordinary shares are held in
treasury by the Company.
Authority to purchase own
shares
The Company has authority to purchase its own shares.
Directors’ interests
Details of the Directors’ beneficial interests are set out in the Directors’ Remuneration
Report on page 90.
Directors’ indemnities
The Company has given indemnities to each of the Directors in respect of any liability
arising against them in connection with the Company’s (and any associated company’s)
activities in the conduct of their duties. These indemnities are subject to the conditions set
out in their indemnification agreements and remain in place at the date of this report.
Directors’ and Officers’
Liability Insurance
Directors’ and Officers’ Liability Insurance cover is in place at the date of this report. Cover
is reviewed annually and the last renewal was carried out in October 2022.
Major interests in shares
Notifiable major shares interests of which the Company has been made aware are set out
on page 61.
Political contributions
The Company did not make any donations to political organisations during the year.
Equality, Diversity and
Inclusion Policy
In December 2022 the Company reapproved and published on its Equality, Diversity and
Inclusion Policy.
https://cdn.plus500.com/media/Investors/Docs/EqualityDiversityInclusionPolicy.pdf
Financial risk
Details of the Company’s policies on financial risk management and the Company’s
exposure to market price risk, credit risk, liquidity risk and cash flow risk are outlined in note
26 to the Consolidated Financial Statements.
Research and Development
Details about the Company’s future developments can be found in the Strategic Report on
pages 7-9.
Auditors
A resolution to reappoint Kesselman & Kesselman, a member firm of
PricewaterhouseCoopers International Limited as external auditors will be proposed at
the 2023 Annual General Meeting.
Post balance sheet events
There have been no post balance sheet events.
Audit information
Each of the Directors at the date of the approval of this report confirms that:
+ so far as he/she is aware, there is no relevant audit information of which the Company’s
auditors are unaware; and
+ he/she has taken all the reasonable steps that he/she ought to have taken as a Director
to make himself/herself aware of any relevant audit information and to establish that
the Company’s auditors are aware of the information.
DIRECTORS’ REPORT
Directors’ Report
95 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Directors’ Report continued
Listing Rule 9.8.4R disclosures
The table below sets out where disclosures required in compliance with Listing Rule 9.8.4R are located.
Interest capitalised and tax relief n/a
Publication of unaudited financial information n/a
Details of long-term incentive schemes Page 85 to 91
Waiver of emoluments by a Director n/a
Waiver of future emoluments by a Director n/a
Non pre-emptive issues of equity for cash n/a
Non pre-emptive issues of equity for cash by major subsidiary undertakings n/a
Parent company participation in a placing by a listed subsidiary n/a
Contracts of significance n/a
Provision of services by a controlling shareholder n/a
Agreements with controlling shareholders n/a
Shareholder waivers of dividends n/a
Shareholder waivers of future dividends n/a
The Directors’ Report has been approved by the Board of Directors of Plus500 Ltd.
Signed on behalf of the Board
Elad Even-Chen
Chief Financial Officer
22 March 2023
96 Plus500 Ltd. Annual Report 2022
Mandatory bids, squeeze out and sell out rules relating to
the Company’s ordinary shares
As the Company is incorporated in Israel, it is subject to Israeli
law and the City Code on Takeovers and Mergers (the
“Takeover Code”) will not apply to the Company. It shall be
noted that the Company has incorporated in its Articles of
Association provisions analogous to Rules 4, 5, 6 and 8 of the
Takeover Code, as described below.
Mergers
The Companies Law permits merger transactions, provided
that each party to the transaction obtains the approval of its
board of directors and shareholders (excluding certain
merger transactions which do not require the approval of the
shareholders, as set forth in the Companies Law).
Pursuant to the Company’s Articles of Association, the
shareholders of the Company are required to approve the
merger by the affirmative vote of a majority of the outstanding
ordinary shares of the Company. In addition, pursuant to the
Companies Law, for purposes of the shareholder vote of each
party, the merger will not be deemed approved if a majority of
the shares not held by the other party, or by any person who
holds 25% or more of the shares or the right to appoint 25% or
more of the directors of the other party, has voted against the
merger.
The Companies Law requires the parties to a proposed merger
to file a merger proposal with the Israeli Registrar of
Companies, specifying certain terms of the transaction.
Shares in one of the merging companies held by the other
merging company or certain of its affiliates are
disenfranchised for purposes of voting on the merger. A
merging company must inform its creditors of the proposed
merger. Any creditor may submit any request to the court in
relation to the merger, and the court may: (1) order to delay or
prevent the merger, if the court finds a reasonable concern
that the surviving party will not be able to satisfy all its
obligations, and (2) instruct orders to guarantee the creditors’
rights. Moreover, a merger may not be completed until at least
50 days have passed from the time that the merger proposal
was filed with the Israeli Registrar of Companies and at least
30 days have passed from the approval of the shareholders of
each of the merging companies.
In addition, under certain circumstances, the provisions of the
Companies Law that deal with “arrangements” between a
company and its shareholders may be used to effect squeeze-
out transactions in which the target company becomes a
wholly-owned subsidiary of the acquirer. These provisions
generally require that the merger be approved by a majority
of the participating shareholders holding at least 75% of the
shares voted on the matter, as well as 75% of each class of
creditors. In addition to shareholder approval, court approval
of the transaction is required.
CORPORATE LAW
Companies Law – Special tender offer
The Companies Law provides that an acquisition of shares of a
public Israeli company must be made by means of a special
tender offer if, as a result of the acquisition, the purchaser shall
become a holder of 25% or more of the voting rights in the
company. This rule does not apply if there is already another
holder of at least 25% of the voting rights in the company.
Similarly, the Companies Law provides that an acquisition of
shares in a public company must be made by means of a
special tender offer if, as a result of the acquisition, the
purchaser could become a holder of more than 45% of the
voting rights in the company, if there is no other shareholder of
the company who holds more than 45% of the voting rights in
the company.
In addition, under the Companies Law, the entry by two or
more shareholders into a shareholders’ agreement, where
such shareholders’ agreement will result in such shareholders
holding concert shares in a company in an amount exceeding
the thresholds set out above, the Company may also be
subject to the requirement to publish a special tender offer.
A special tender offer must be extended to all shareholders of
a company but the offeror is not required to purchase shares
representing more than 5% of the voting power attached to
the company’s outstanding shares, regardless of how many
shares are tendered by shareholders. A special tender offer
may be consummated only if at least 5% of the voting power
attached to the company’s outstanding shares will be
acquired by the offeror and the number of shares tendered in
the offer exceeds the number of shares whose holders
objected to the offer.
If a special tender offer is accepted, then the purchaser or any
person or entity controlling it or under common control with
the purchaser or such controlling person or entity may not
make a subsequent tender offer for the purchase of shares of
the target company and may not enter into a merger with the
target company for a period of one year from the date of the
offer, unless the purchaser or such person or entity undertook
to effect such an offer or merger in the initial special tender
offer. Shares that are acquired in violation of this requirement
to make a tender offer will be deemed Dormant Shares (as
defined in the Companies Law) and will have no rights
whatsoever for so long as they are held by the acquirer.
Corporate Law
97 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Corporate Law continued
Companies Law – Full tender offer
Under the Companies Law, a person may not purchase shares
of a public company if, following the purchase, the purchaser
would hold more than 90% of the company’s shares or of any
class of shares, unless the purchaser makes a tender offer to
purchase all of the target company’s shares or all the shares
of the particular class, as applicable. If, as a result of the tender
offer, either:
+ The purchaser acquires more than 95% of the company’s
shares or a particular class of shares and a majority of the
shareholders that did not have a Personal Interest accepted
the offer; or
+ The purchaser acquires more than 98% of the company’s
shares or a particular class of shares.
Then, the Companies Law provides that the purchaser
automatically acquires ownership of the remaining shares.
However, if the purchaser is unable to purchase more than
95% or 98%, as applicable, of the company’s shares or class of
shares, the purchaser may not own more than 90% of the
shares or class of shares of the target company.
Articles of Association – Anti-Takeover and prohibited
acquisitions provisions
In addition to the tender offer rules applied by the Companies
Law (as described above), offers are also subject to the
takeover provisions incorporated in the Company’s Articles of
Association, which provisions refer to compliance with Rules 4,
5, 6 and 8 of the UK City Code on Takeovers.
Convening General Meetings by Directors and
Shareholders and adding items to the agenda
According to the Companies Law, the board of directors of a
public company shall convene an extraordinary general
meeting at its own decision, and also on the demand of each
of the following:
+ two directors or a quarter of the serving directors; or
+ one or more shareholders who have at least 5% of the issued
share capital and at least 1% of the voting rights in the
company, or one or more shareholders who have at least 5%
of the voting rights in the company.
In addition, one or more shareholders with at least 1% of the
voting rights at the general meeting may request that the
board of directors include a subject on the agenda of a
general meeting that will be convened in the future, on
condition that the subject is suitable for discussion at a
general meeting.
98 Plus500 Ltd. Annual Report 2022
The Directors are responsible for preparing the Annual Report
and the Consolidated Financial Statements in accordance
with applicable law and regulations. The Companies Law
requires the Directors to prepare Consolidated Financial
Statements for each financial year. Under that law, the
Directors have elected to prepare the Consolidated Financial
Statements in accordance with International Financial
Reporting Standards as issued by the IASB (“IFRS”). The
Directors must not approve the Consolidated Financial
Statements unless they are satisfied that they give a true and
fair view of the state of affairs of the Group and the
Comprehensive Income of the Group for that period. The
Directors considered the information provided in the Annual
Report and how it assists the Company’s shareholders in
understanding the Group’s position, performance business
model and strategy.
In preparing these Consolidated Financial Statements, the
Directors are required to:
+ Present fairly the financial position, financial performance
and cash flows of the Group;
+ Present information, including accounting policies, in a
manner that provides relevant, reliable, consistent and
understandable information;
+ Make judgements and accounting estimates that are
reasonable;
+ State whether applicable IFRS have been followed, subject
to any material departures disclosed and explained in the
Consolidated Financial Statements;
+ Provide additional disclosures when compliance with the
specific requirements in IFRS is insufficient to enable users to
understand the impact of transactions, other events and
conditions on the Group’s financial position and financial
performance;
+ Prepare the Consolidated Financial Statements on the
going concern basis unless it is inappropriate to presume
the Group will continue in business.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain the
Group’s transactions and to disclose with reasonable
accuracy at any time the financial position of the Group and
enable them to ensure that the Consolidated Financial
Statements comply with applicable law.
DIRECTORS’ RESPONSIBILITY
STATEMENT
They are also responsible for safeguarding the assets of the
Group and hence for taking reasonable steps in the prevention
and detection of fraud and other irregularities.
Each of the Directors confirms that, to the best of each person’s
knowledge and belief:
+ The Group’s Consolidated Financial Statements, which have
been prepared in accordance with IFRS, give a true and fair
view of the assets, liabilities, financial position and profit of
the Group;
+ The Directors’ Report includes a fair review of the
development and performance of the business and the
position of the Group, together with a description of the
principal risks and uncertainties that it faces.
The Directors consider that the Annual Report, taken as a
whole, is fair, balanced and understandable, and provides the
information necessary for shareholders to assess the Group’s
position, performance, business model and strategy.
The Directors are also responsible for preparing the Directors’
Report, Strategic Report, Corporate Governance Report and
the Directors’ Remuneration Report.
This report has been approved by the Board.
Signed on behalf of the Board
David Zruia
Chief Executive Officer
22 March 2023
Directors’ Responsibility Statement
99 Plus500 Ltd. Annual Report 2022
Financial statementsGovernanceStrategic report
Contents
FINANCIAL
STATEMENTS
For illustrative purposes
Independent Report
of the Auditors
101
Consolidated Financial
Statements in US Dollars ($)
Consolidated Statement
of Comprehensive Income
106
Consolidated Statement
of Financial Position
107
Consolidated Statement
of Changes in Equity
108
Consolidated Statement
of Cash Flows
109
Notes to the Consolidated
Financial Statements
110
100 Plus500 Ltd. Annual Report 2022
Report on the audit of the
consolidated financial statements
Opinion
In our opinion, the consolidated financial statements present
fairly, in all material respects, the consolidated financial
position of Plus500 Ltd. (the “Company”) and its subsidiaries
(the “Group”) as at 31 December 2022 and its consolidated
results of operations and its consolidated cash flows for the
year then ended in accordance with International Financial
Reporting Standards (“IFRSs”) as issued by the International
Accounting Standards Board.
What we have audited
The Group’s consolidated financial statements comprise:
+ The consolidated statement of financial position as at
31 December 2022;
+ The consolidated statement of comprehensive income for
the year then ended;
+ The consolidated statement of changes in equity for the
year then ended;
+ The consolidated statement of cash flows for the year then
ended; and
+ The notes to the consolidated financial statements, which
include a summary of significant accounting policies and
other explanatory information.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (“ISAs”). Our responsibilities under those
standards are further described in the Auditor’s responsibilities
for the audit of the consolidated financial statements section
of our report.
We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Group in accordance with the
International Ethics Standards Board for Accountants’ Code of
Ethics for Professional Accountants including International
Independence Standards issued by the International Ethics
Standards Board for Accountants (“IESBA Code”). We have
fulfilled our other ethical responsibilities in accordance with
the IESBA Code.
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the
consolidated financial statements of the current period. These
matters were addressed in the context of our audit of the
consolidated financial statements as a whole, and in forming
our opinion thereon, and we do not provide a separate opinion
on these matters.
Independent Report of the Auditors
TO THE SHAREHOLDERS
OF PLUS500 LTD.
Kesselman & Kesselman, PwC Israel, 146 Derech Menachem Begin St. Tel-Aviv 6492103,
P.O. Box 7187 Tel-Aviv 6107120 Telephone: +972 -3- 7954555, Fax: +972 -3- 7954556, www.pwc.com/il
Financial statements
101 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
KEY AUDIT MATTER HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
Plus500 offers customers a range of trading products,
including OTC (“Over-the-Counter” products, namely
Contracts for Difference (CFDs)), share dealing, as well as
futures and options on futures.
The Group has developed and operates online trading
platforms.
Trading income represents Customer Income, which mainly
includes revenue from OTC Customer Income (customer
spreads and overnight charges) and Non-OTC Customer
Income (commissions from the Group’s futures and options
on futures operation and from ‘Plus500 Invest’, the Group’s
share dealing platform), and Customer Trading Performance,
which includes gains/losses on customers’ trading positions,
arising on client trading activity.
In respect of trading income generated from OTC offering, the
Group has developed and operates an online trading platform
for trading OTCs. The computation of the revenue is carried out
automatically by using its own developed platform which is an
internal IT system (the “Platform”).
The revenue is calculated based on several parameters. Part
of the parameters that feed into that calculation are received
from external quotation suppliers and others depend on
internally developed program code within the Platform.
The revenue depends on a combination of the effective
operation and accuracy of controls over, and access rights to,
the Platform.
Our audit predominantly focused on the Group’s control
environment, including the IT environment. We tested key
controls over the revenue process, from the acceptance of a
new customer, through the trading activity to the revenue that
is recorded in the Company’s general ledger.
We tested the operating effectiveness of IT general controls,
including: access to programmes and supporting data,
program changes and computer operations for the Platform
and for the ERP system. In addition, we tested program
development controls over the ERP system.
We also tested, through a combination of controls and
substantive testing techniques, the following:
+ Profit/loss calculations in respect of closed positions;
+ Calculation of the fair value adjustment of year-end
positions held by clients and the calculation of the “open
positions” report produced by the Platform;
+ Appropriate use of feeds the Group receives from its data
suppliers to confirm the integrity of the feeds used to
calculate the open/close position; and
+ Controls associated with cash reconciliations and
reconciliations with external counterparties throughout the
year including client deposits/withdrawals.
We agreed cash amounts of client deposits to external third-
party evidence at the year-end by receiving independent
confirmations from banks and other third-party providers. In
addition, we tested the interface between the data of client
money as presented in the Platform to the general ledger to
ensure completeness and accuracy.
Finally, to address the risk that fraudulent adjustments or
transactions had been entered into the trading platform, we
read client activity reports and read a sample of client
complaints.
No material issues noted.
Kesselman & Kesselman, PwC Israel, 146 Derech Menachem Begin St. Tel-Aviv 6492103,
P.O. Box 7187 Tel-Aviv 6107120 Telephone: +972 -3- 7954555, Fax: +972 -3- 7954556, www.pwc.com/il
REVENUE RECOGNITION
Independent Report of the Auditors continued
102 Plus500 Ltd. Annual Report 2022
KEY AUDIT MATTER HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
As discussed in Note 3 and Note 10 to the consolidated financial
statements, the Group operates in a multinational tax
environment and is subject to tax laws, regulations and
transfer pricing guidelines for intercompany transactions
across several tax jurisdictions. Furthermore, the Company’s
tax years for 2022, 2021 and 2020 are yet to be assessed by the
Israeli tax authorities. The subsidiaries of the Group have not
yet been subject to tax assessments since their inception. The
Group recognises tax provisions from uncertain tax positions
when there is more likely than not a likelihood that the tax
position will be sustained upon examination by the taxation
authorities based on the technical merits of the position.
Auditing management’s estimate of amounts related to tax
provisions involves auditor judgement and challenging
management because management’s estimates are
complex, judgemental and based on interpretations of tax
laws, regulations and legal rulings.
Among the audit procedures we performed, we involved our
tax specialists to assist us in assessing the technical merits of
the Group’s tax positions. This included assessing the Group’s
correspondence with the relevant tax authorities and
evaluating income tax opinions or other third-party advice
obtained by the Group. In addition, we evaluated the
appropriateness of the Group’s accounting for its tax positions.
We analysed the Group’s assumptions and data used to
determine the amount of tax provision and tested the
accuracy of the calculations. We also evaluated whether the
Group’s disclosures complied with the accounting framework.
No material issues noted.
Kesselman & Kesselman, PwC Israel, 146 Derech Menachem Begin St. Tel-Aviv 6492103,
P.O. Box 7187 Tel-Aviv 6107120 Telephone: +972 -3- 7954555, Fax: +972 -3- 7954556, www.pwc.com/il
UNCERTAIN TAX PROVISIONS
Financial statements
103 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
Other information
The Directors are responsible for the other information, which
includes reporting based on the Task Force on Climate-related
Financial Disclosures (TCFD) recommendations. The other
information comprises all of the information in the Annual
Report (but does not include the consolidated financial
statements and our auditor’s report thereon).
Our opinion on the consolidated financial statements does
not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the consolidated financial
statements, our responsibility is to read the other information
identified above and, in doing so, consider whether the other
information is materially inconsistent with the consolidated
financial statements or our knowledge obtained in the audit, or
otherwise appears to be materially misstated. If, based on the
work we have performed, we conclude that there is a material
misstatement of this other information, we are required to
report that fact. We have nothing to report in this regard.
Based on the responsibilities described above and our work
undertaken in the course of the audit, we have also agreed to
report on certain matters as described below in accordance
with the Listing Rules of the United Kingdom Financial Conduct
Authority (FCA) as if the Company were a UK incorporated
premium listed entity.
Corporate governance statement
Under the UK Corporate Governance Code 2018, we have
reviewed the Directors’ statements in relation to the going
concern, longer-term viability and that part of the corporate
governance statement relating to the Company’s compliance
with the provisions of the UK Corporate Governance Code,
which the Listing Rules of the Financial Conduct Authority
specify for review by auditors of premium listed companies.
Our additional responsibilities with respect to the corporate
governance statement as other information are described in
the Other information section of this report.
Based on the work undertaken as part of our audit, we have
concluded that each of the following elements of the
corporate governance statement, included within the
Statement on Corporate Governance is materially consistent
with the financial statements and our knowledge obtained
during the audit:
+ The Directors’ confirmation that they have carried out a
robust assessment of the emerging and principal risks;
+ The disclosures in the Annual Report that describe those
principal risks, what procedures are in place to identify
emerging risks and an explanation of how these are being
managed or mitigated;
+ The Directors’ statement in the financial statements about
whether they considered it appropriate to adopt the going
concern basis of accounting in preparing them, and their
identification of any material uncertainties to the
Company’s ability to continue to do so over a period of at
least twelve months from the date of approval of the
financial statements;
Independent Report of the Auditors continued
Kesselman & Kesselman, PwC Israel, 146 Derech Menachem Begin St. Tel-Aviv 6492103,
P.O. Box 7187 Tel-Aviv 6107120 Telephone: +972 -3- 7954555, Fax: +972 -3- 7954556, www.pwc.com/il
+ The Directors’ explanation as to their assessment of the
Company’s prospects, the period this assessment covers
and why the period is appropriate;
+ The Directors’ statement as to whether they have a
reasonable expectation that the Company will be able to
continue in operation and meet its liabilities as they fall due
over the period of its assessment, including any related
disclosures drawing attention to any necessary
qualifications or assumptions;
+ The Directors’ statement that they consider the Annual
Report, taken as a whole, is fair, balanced and
understandable, and provides the information necessary
for the members to assess the Company’s position,
performance, business model and strategy;
+ The section of the Annual Report that describes the review
of effectiveness of risk management and internal control
systems; and
+ The section of the Annual Report describing the work of the
Audit Committee.
Responsibilities of management and those charged with
governance for the consolidated financial statements
Management is responsible for the preparation and fair
presentation of the consolidated financial statements in
accordance with IFRSs as issued by the International
Accounting Standards Board, and for such internal control as
management determines is necessary to enable the
preparation of consolidated financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements,
management is responsible for assessing the Group’s ability
to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern
basis of accounting unless management either intends to
liquidate the Group or to cease operations, or has no realistic
alternative but to do so.
Those charged with governance are responsible for
overseeing the Group’s financial reporting process.
Auditor’s responsibilities for the audit of the consolidated
financial statements
Our objectives are to obtain reasonable assurance about
whether the consolidated financial statements as a whole are
free from material misstatement, whether due to fraud or error,
and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a
guarantee that an audit conducted in accordance with ISAs
will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic
decisions of users taken on the basis of these consolidated
financial statements.
104 Plus500 Ltd. Annual Report 2022
As part of an audit in accordance with ISAs, we exercise
professional judgement and maintain professional scepticism
throughout the audit. We also:
+ Identify and assess the risks of material misstatement of
the consolidated financial statements, whether due to
fraud or error, design and perform audit procedures
responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting
from fraud is higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control;
+ Obtain an understanding of internal control relevant to the
audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the Group’s
internal control;
+ Evaluate the appropriateness of accounting policies used
and the reasonableness of accounting estimates and
related disclosures made by management;
+ Conclude on the appropriateness of management’s use of
the going concern basis of accounting and, based on the
audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast
significant doubt on the Group’s ability to continue as a
going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor’s
report to the related disclosures in the consolidated
financial statements or, if such disclosures are inadequate,
to modify our opinion. Our conclusions are based on the
audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the
Group to cease to continue as a going concern;
+ Evaluate the overall presentation, structure and content of
the consolidated financial statements, including the
disclosures, and whether the consolidated financial
statements represent the underlying transactions and
events in a manner that achieves fair presentation; and
+ Obtain sufficient appropriate audit evidence regarding the
financial information of the entities or business activities
within the Group to express an opinion on the consolidated
financial statements. We are responsible for the direction,
supervision and performance of the Group audit. We
remain solely responsible for our audit opinion.
Kesselman & Kesselman, PwC Israel, 146 Derech Menachem Begin St. Tel-Aviv 6492103,
P.O. Box 7187 Tel-Aviv 6107120 Telephone: +972 -3- 7954555, Fax: +972 -3- 7954556, www.pwc.com/il
We communicate with those charged with governance
regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify
during our audit.
We also provide those charged with governance with a
statement that we have complied with relevant ethical
requirements regarding independence, and to communicate
with them all relationships and other matters that may
reasonably be thought to bear on our independence, and
where applicable, related safeguards.
From the matters communicated with those charged with
governance, we determine those matters that were of most
significance in the audit of the consolidated financial
statements of the current period and are therefore the key
audit matters. We describe these matters in our auditor’s
report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances,
we determine that a matter should not be communicated in
our report because the adverse consequences of doing so
would reasonably be expected to outweigh the public interest
benefits of such communication.
The engagement partner on the audit resulting in this
independent auditor’s report is Ido Heller.
Tel Aviv, Israel Kesselman & Kesselman
Certified Public Accountants (lsr.)
A member firm of PricewaterhouseCoopers
International Limited
Ido Heller
Partner
Tel Aviv, Israel
22 March 2023
Financial statements
105 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
Year ended 31 December
US dollars in millions Note 2022 2021
Trading income 4 832 .6 718. 7
Selling and marketing expenses 5 302 .1 279 . 8
Administrative and general expenses 6 80 .1 54.3
Operating profit 450. 4 3 84 .6
Financial income 41 .3 10.4
Financial expenses 1 7. 4 8.6
Financial income, net 23.9 1.8
Profit before income tax 474 . 3 386 .4
Income tax expense 10 1 03.9 75. 8
Profit and comprehensive income for the year 370.4 31 0.6
Basic earnings per share (In US dollars) 11 3.8 1 3.06
Diluted earnings per share (In US dollars) 11 3.7 7 3 .05
The accompanying notes are an integral part of the consolidated financial statements.
Consolidated Statement of Comprehensive Income
106 Plus500 Ltd. Annual Report 2022
As of 31 December
US dollars in millions Note 2022 2021
Assets
Non-current assets
Property, plant and equipment 15 2.6 2.6
Goodwill and other intangible assets, net 23 38.7 28 .0
Right of use assets 20 5.6 5.6
Long term other receivables 5.8 4.4
Total non-current assets 52 .7 40.6
Current assets
Income tax receivable 0. 2 -
Other receivables and others 14 26.9 32 .7
Cash and cash equivalents 16 930. 2 749 . 5
Total current assets 9 5 7. 3 782 . 2
TOTAL ASSETS 1,01 0.0 82 2 . 8
Liabilities
Non-current liabilities
Lease liabilities (net of current maturities) 20 3.6 4.2
Share based compensation 9 - 0.3
Deferred tax liability 6.9 -
Total non-current liabilities 10.5 4.5
Current liabilities
Share based compensation 9 6 .3 7. 3
Income tax payable 116.4 89.9
Other payables 17 72 . 2 41 .7
Service suppliers 18 11 .7 15.5
Current maturities of lease liabilities 20 2.0 2.0
Trade payables – due to clients 19 10. 4 0.6
Total current liabilities 219.0 157 .0
TOTAL LIABILITIES 22 9.5 161 .5
Equity
Ordinary shares 22 0. 3 0. 3
Share premium 22. 2 22.2
Cost of Company’s shares held by the Company 12 (341.1) (2 0 7. 5)
Retained earnings 1,099.1 846.3
Total equity 780.5 661 .3
TOTAL LIABILITIES AND EQUITY 1,01 0.0 82 2 . 8
David Zruia Elad Even-Chen Jacob Frenkel
Chief Executive Officer Group Chief Financial Officer Non-Executive Director
and Chairman
Date of approval of the consolidated financial statements by the Company’s Board of Directors: 22 March 2023.
The accompanying notes are an integral part of the consolidated financial statements.
Registered Company number (Israel): 514142140
Consolidated Statement of Financial Position
Financial statements
107 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
US dollars in millions
Ordinary
shares
Share
premium
Cost of
Company’s
shares held by
the Company
Retained
earnings Total
Balance at 1 January 2021 0.3 22. 2 (1 4 5 . 7) 67 8.8 555 .6
Changes during the year ended 31 December 2021
Profit and comprehensive income for the year - - - 310 .6 310. 6
Share based compensation - - - 4.9 4 .9
Transaction with shareholders:
Dividend - - - (1 4 4 . 9) (1 4 4 . 9)
Issue of treasury shares to settle equity share based
compensation - - 3.1 (3 . 1) -
Acquisition of treasury shares - - (64 . 9) - (6 4 .9)
Balance at 31 December 2021 0.3 22. 2 (2 0 7. 5) 846.3 661 . 3
Changes during the year ended 31 December 2022
Profit and comprehensive income for the year - - - 370. 4 370 . 4
Share based compensation - - - 7. 5 7. 5
Transaction with shareholders:
Dividend - - - (119.9) (119.9)
Issue of treasury shares to settle equity share based
compensation - - 5. 2 (5 . 2) -
Acquisition of treasury shares - - (138.8) - (138.8)
Balance at 31 December 2022 0.3 22. 2 (3 41 . 1) 1 ,099.1 78 0. 5
The accompanying notes are an integral part of the consolidated financial statements.
Consolidated Statement of Changes in Equity
108 Plus500 Ltd. Annual Report 2022
Year ended 31 December
US dollars in millions 2022 2021
Operating activities:
Cash generated from operations (see Note 27) 506.8 383 .0
Income tax received (paid), net (6 6 . 2) 16 .3
Interest received, net 13 .5 6.2
Net cash flows provided by operating activities 454 .1 405.5
Investing activities:
Acquisition of subsidiaries, net of cash acquired (see Note 24) (4 . 6) (32 . 5)
Purchase of property, plant and equipment (0 . 8) (0 . 8)
Net cash flows used in investing activities (5 . 4) (33.3)
Financing activities:
Dividend paid to equity holders of the Company (1 1 9 . 9) (14 4 . 9)
Payment of principal in respect of lease liabilities (2 .3) (2 .0)
Acquisition of treasury shares (1 3 8 . 8) (6 4 . 9)
Net cash flows used in financing activities (2 6 1 . 0) (2 11 . 8)
Increase in cash and cash equivalents 1 8 7. 7 160.4
Balance of cash and cash equivalents at beginning of the year 749 . 5 593 . 9
Losses from effects of exchange rate changes on cash and cash equivalents (7. 0) (4 . 8)
Balance of cash and cash equivalents at end of the year 930. 2 749 . 5
The accompanying notes are an integral part of the consolidated financial statements.
Consolidated Statement of Cash Flows
Financial statements
109 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
Notes to the Consolidated Financial Statements
NOTE 1 – GENERAL INFORMATION
Information on activities
Plus500 Ltd. (the “Company”) and its subsidiaries (the “Group”)
is a global multi-asset fintech group operating proprietary
technology-based trading platforms. Plus500 offers
customers a range of trading products, including OTC (“Over-
the-Counter” products, namely Contracts for Difference
(CFDs)), share dealing, as well as futures and options on
futures. The Company has developed and operates an online
trading platform within the OTC sector, enabling its
international customer base of individual customers to trade
OTC products on over 2,500 underlying financial instruments
internationally.
The Group’s offering is available internationally with main
market presence in the UK, the European Economic Area (EEA),
Australia, the US, and the Middle East and has customers
located in more than 50 countries worldwide. The Group
operates through operating subsidiaries regulated by the
Financial Conduct Authority (“FCA”) in the UK, the Australian
Securities and Investments Commission (“ASIC”) in Australia,
the Cyprus Securities and Exchange Commission (“CySEC”) in
Cyprus, the Israel Securities Authority (“ISA”) in Israel, the
Financial Markets Authority (“FMA”) in New Zealand, the
Financial Sector Conduct Authority (“FSCA”) in South Africa, the
Monetary Authority of Singapore (“MAS”) in Singapore, the
Financial Services Authority (“FSA”) in the Seychelles, the
Commodities Futures Trading Commission (“CFTC”) in the US,
the Estonian Financial Supervision Authority (“EFSA”) in Estonia,
the Financial Services Agency (“FSA”) in Japan and the Dubai
Financial Services Authority (“DFSA”) in the UAE.
The Company also has a subsidiary in Bulgaria which provides
operational services to the Group.
The Company has been listed since 2013 on the London Stock
Exchange. Since 2018, Plus500 Ltd. has been a FTSE 250 listed
entity, following the Company’s shares being admitted to the
premium listing segment of the Official List and to trading on
the London Stock Exchange Main Market for listed securities.
The Group operates in three operating sectors: OTC trading;
share dealing; and futures and options on futures. The Group
presents its operation as one operating segment.
The address of the Company’s principal offices is Building 25,
MATAM, Haifa 3190500, Israel.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Basis of accounting and accounting policies
The Group’s consolidated financial information as of
31 December 2022 and 2021 and for each of the two years in the
period ended on 31 December 2022 are in compliance with
International Financial Reporting Standards that consist of
standards and interpretations issued by the International
Accounting Standard Board (“IFRSs”).
The significant accounting policies described below have
been applied consistently in relation to all the reporting
periods, unless otherwise stated.
The financial information has been prepared under the
historical cost convention subject to adjustments in respect of
revaluation of financial assets at fair value through profit or
loss presented at fair value.
b. Going concern
The Group has considerable financial resources, a broad
range of financial instruments and a substantial active
customer base which is geographically diversified. As a
consequence, the Company’s Board of Directors (the “Board”)
believes that the Group is well placed to manage its business
risks in the context of the current economic outlook.
Accordingly, the Board has a reasonable expectation that the
Group has adequate resources to continue in operational
existence for the foreseeable future. The Board therefore
continues to adopt the going concern basis in preparing these
consolidated financial statements.
c. Principles of consolidation
The Company, from an accounting perspective, controls the
subsidiaries since it is exposed to, or has rights to, variable
returns from its involvement with the entities and has the
ability to affect those returns through its power over them.
1) The consolidated financial statements include the
accounts of the Company and its subsidiaries.
2) Intercompany balances and transactions between the
Group’s entities have been eliminated.
3) Accounting policies of the subsidiaries have been changed
where necessary to ensure consistency with the policies
adopted by the Group.
d. Earnings per share
Basic earnings per share is calculated by dividing the profit
attributable to equity holders of the Company by the weighted
average number of the Company’s ordinary shares in issue
during the year, excluding ordinary shares purchased by the
Company and held as treasury shares.
Diluted earnings per share is calculated by adjusting the
weighted average number of ordinary shares outstanding to
assume exercise of all potential dilutive ordinary shares. The
instruments that are potentially dilutive ordinary shares are
equity instruments granted to employees and service
contractors (see Note 9). A calculation is done to determine
the number of shares that could have been acquired at fair
value (determined as the average annual market share price
of the Company’s shares) based on the monetary value of the
subscription rights attached to outstanding equity
instruments. The number of ordinary shares calculated as
above is compared with the number of ordinary shares that
would have been issued assuming the exercise of the equity
instruments (see also Note 11) .
110 Plus500 Ltd. Annual Report 2022
e. Segment reporting
Operating segments are reported in a manner consistent with
the internal reporting provided to the chief operating decision
maker, who is responsible for allocating resources and
assessing performance of the operating segments.
As stated in Note 1 above, the Group operates in three operating
sectors: OTC trading; share dealing; and futures and options
on futures. For the years 2022 and 2021, the Group presents its
operation as one operating segment.
f. Foreign currency translation
1) Functional and Presentation Currency
Items included in the financial information of each of the
Group’s entities are measured using the currency of the
primary economic environment in which that entity operates
(the “functional currency”). The consolidated financial
statements are presented in US dollars (“USD”), which is the
Group’s functional and presentation currency.
2) Transactions and balances
Foreign currency transactions in currencies different from the
functional currency (“foreign currency”) are translated into the
functional currency using the exchange rates prevailing at the
dates of the transactions or valuation where items are
remeasured.
Gains and losses arising from translations in exchange rates
are presented in the consolidated statement of
comprehensive income among “financial income (expenses)”
g. Trading income
Trading income represents Customer Income, which includes
revenue from OTC Customer Income (customer spreads and
overnight charges), non-OTC Customer Income (commissions
from the Group’s futures and options on futures operation and
from the Group’s share dealing platform) and Customer
Trading Performance, which includes gains/losses on
customers’ trading positions, arising on client trading activity,
primarily in OTCs on shares, indices, ETFs, options, commodities,
cryptocurrencies and foreign exchange. Open client positions
are carried at fair value and gains and losses arising on this
valuation are recognised as trading income, as well as gains
and losses realised on positions that have closed.
h. Share based compensation
1) Cash settled
The Group operates a cash settled share based compensation
plan, under which it receives services from employees and
service contractors as consideration for Share Appreciation
Rights (“SARs”). The fair value of the employees and service
contractors received in exchange for the grant of the rights are
recognised as an expense in the consolidated statement of
comprehensive income. At the end of each reporting period,
the Group evaluates the SARs based on their fair value as
prorated over the period and the change in the prorated fair
value is recognised in the consolidated statement of
comprehensive income.
2) Equity settled
The Group operates equity settled share based compensation
plans, under which it receives services from employees and
service contractors as consideration for ordinary shares and
Restricted Share Units (“RSUs”). The fair value of the services
received by employees and service contractors in exchange
for the grant of ordinary shares or RSUs are recognised as an
expense in the consolidated statement of comprehensive
income.
The fair value of equity settled share based compensation
arrangements granted to employees and service contractors
is recognised as employee benefit expenses and other related
expenses applicable for the service contractors, with a
corresponding increase in equity. The total amount to be
expensed is determined by reference to the fair value of the
equity instruments granted:
+ including any market performance conditions (e.g. the
Company’s share price);
+ excluding the impact of any service and non-market
performance vesting conditions (e.g. profitability, sales
growth targets and continuing to be employed or rendering
services to the entity over a specified time period); and
+ including the impact of any non-vesting conditions (e.g. the
requirement for employees and service contractors to hold
shares for a specific period of time).
The total expenses are recognised over the vesting period,
which is the period over which all of the specified vesting
conditions are to be satisfied. At the end of each period, the
Group revises its estimates of the number of ordinary shares
and RSUs that are expected to vest based on the non-market
performance vesting and service conditions. The impact of
the revision to original estimates, if any, in the consolidated
statement of comprehensive income, is recognised with a
corresponding adjustment to equity.
i. Treasury shares
Treasury shares are ordinary shares of the Company held by
the Company and presented as a reduction of equity, at the
consideration paid, including any incremental attributable
costs, net of tax. Treasury shares do not have a right to receive
dividends or to vote. The Board approves share buyback
programmes. The share buyback programmes are funded
from the Company’s net cash balances. The ordinary shares
are being purchased at fair value (see Note 12) .
Financial statements
111 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
Notes to the Consolidated Financial Statements continued
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
continued
j. Current income tax
Tax is recognised in the consolidated statement of
comprehensive income.
The current income tax charge is calculated on the basis of
the tax laws enacted at the statement of financial position
date in countries where the Company and its subsidiaries
operate and generate taxable income.
Management periodically evaluates positions taken in tax
returns with respect to situations in which applicable tax
regulation is subject to interpretation and considers whether it
is probable that a taxation authority will accept an uncertain
tax treatment. It establishes provisions where appropriate on
the basis of amounts expected to be paid to the tax authorities.
The Group measures its tax balances either based on the most
likely amount or the expected value, depending on which
method provides a better prediction of the resolution of the
uncertainty.
k. Deferred income tax
Deferred income tax is recognised, using the liability method,
on temporary differences arising between the tax bases of
assets and liabilities and their carrying amounts in the
consolidated financial statements.
Deferred income tax is determined using tax rates (and laws)
that have been enacted or substantially enacted by the
statement of financial position date and are expected to apply
when the related deferred income tax asset is realised or the
deferred income tax liability is settled.
The Group recognises deferred taxes on temporary
differences arising on investments in subsidiaries, except
where the timing of the reversal of the temporary difference is
controlled by the Group and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred income tax assets are recognised only to the extent
that it is probable that future taxable profit will be available
against which the temporary differences can be utilised.
l. Property, plant and equipment
The cost of a property, plant and equipment item is recognised
as an asset only if: (a) it is probable that the future economic
benefits associated with the item will flow to the Group; and (b)
the cost of the item can be measured reliably.
Property, plant and equipment are stated at historical cost
less accumulated depreciation. Historical cost includes
expenditure that is directly attributable to the acquisition of
the items and only when the two criteria mentioned above for
recognition as assets are met.
Depreciation is calculated using the straight-line method to
allocate the cost of property, plant and equipment less their
residual values over their estimated useful lives, as follows:
Percentage
of annual
depreciation
Computers and office equipment 6–33
Leasehold improvements 10
Leasehold improvements are depreciated by the straight-line
method over the terms of the lease (including reasonably
assured options periods), or the estimated useful life (10 years)
of the improvements, whichever is shorter.
The asset’s residual value, the depreciation method and useful
lives are reviewed, and adjusted if appropriate, at least once a
year.
An asset’s carrying amount is written down immediately to its
recoverable amount if the asset’s carrying amount is greater
than its estimated recoverable amount.
m. Financial instruments
1) Classification
The Group classifies its financial assets in the following
measurement categories according to IFRS 9:
+ Those to be measured subsequently at fair value through
profit and loss, and
+ Those to be measured at amortised cost.
The classification depends on the entity’s business model for
managing the financial assets and the contractual terms of
the cash flows.
For assets measured at fair value, gains and losses will be
recorded in the consolidated statement of comprehensive
income.
Financial assets are classified as current if they are expected
to mature within 12 months after the end of the reporting
period, otherwise, they are classified as non-current.
2) Recognition and derecognition
Regular way purchases and sales of financial assets are
recognised on trade date, the date on which the Group
commits to purchase or sell the assets. Financial assets are
derecognised when the rights to receive cash flows from the
financial assets have expired or have been transferred and
the Group has transferred substantially all the risks and
rewards of ownership.
3) Measurement
At initial recognition, the Group measures a financial asset at
its fair value and in the case of a financial asset not at fair value
through profit or loss (“FVTPL”), plus transaction costs that are
directly attributable to the acquisition of the financial asset.
Transaction costs of financial assets carried at FVTPL are
expensed in the consolidated statement of comprehensive
income.
Financial assets with embedded derivatives are considered in
their entirety when determining whether their cash flows are
solely payment of principal and interest.
Details on how the fair value of financial instruments is
determined are disclosed in Note 26.
112 Plus500 Ltd. Annual Report 2022
n. Cash and cash equivalents
Cash and cash equivalents include cash on hand, short-term
bank deposits and other highly liquid short-term investments,
the original maturity of which does not exceed three months.
All of the regulated subsidiaries hold money on behalf of their
clients in accordance with the client money rules required by
the relevant regulatory framework. Such monies are classified
as “segregated client funds” in accordance with the regulatory
requirements. Segregated client funds comprise client funds
held in segregated client money accounts.
Segregated client money accounts hold statutory trust status
restricting the Group’s ability to control the monies and
accordingly such amounts are not reflected as Group assets
in the consolidated statement of financial position.
o. Dividends
Dividend distribution is recognised as a liability in the
consolidated statement of financial position in the period
which the dividends are approved by the Board.
p. Employee benefits and pension obligations
The Group operates various pension schemes. The schemes
are generally funded through payments to insurance
companies or trustee-administered pension funds.
The Group has defined contribution plans. A defined
contribution plan is a pension plan under which the Group
pays fixed contributions into a separate entity. The Group has
no legal or constructive obligations to pay further contributions
if the fund does not hold sufficient assets to pay all employees
the benefits relating to employee service in the current and
prior periods.
The Group pays contributions to publicly or privately
administered pension insurance plans on a mandatory basis.
The Group has no further payment obligations once the
contributions have been paid. The contributions are
recognised as employee benefit expense commensurate
with receipt from employees of the service in respect of which
they are entitled for the contributions.
The Group recognises an accrual and an expense for bonuses
for senior management based on formulae that take into
consideration specific financial and non-financial measures
and for other employees based on management decision.
q. Service suppliers
Service suppliers are obligations to pay for services that have
been acquired in the ordinary course of business from
suppliers. Service suppliers are classified as current liabilities if
payment is due within one year or less. If not, they are
presented as non-current liabilities.
Service suppliers are recognised initially at fair value and
subsequently measured at amortised cost using the effective
interest method.
r. Trade payables – due to clients
As part of its business, the Group receives from its customers
deposits to secure their trading positions, held in segregated
client money accounts.
Assets or liabilities resulting from profits or losses on open
positions are carried at fair value. Amounts due from or to
clients are netted against, or presented with, the deposit with
the same counterparty where a legally enforceable netting
agreement is in place and where it is anticipated that assets
and liabilities will be netted on settlement.
“Trade payables – due to clients” represent balances with
clients where the combination of customers’ deposits and the
valuation of financial derivative open positions result in an
amount payable by the Group.
“Trade payables – due to clients” are reported in the
consolidated statement of financial position and classified as
current liabilities as the demand is due within one year or less.
s. IFRS 16 – “Leases”
The Group’s leases include real estate lease agreements. At
inception of a contract, the Group assesses whether a
contract is, or contains, a lease. A contract is, or contains, a
lease if the contract conveys the right to control the use of an
identified asset for a period of time in exchange for a
consideration. The Group reassesses whether a contract is, or
contains, a lease only if the terms and conditions of the
contract are changed.
At the commencement date, the Group measures the lease
liability at the present value of the lease payments that are not
paid at that date, including, inter alia, the exercise price of the
exercise option if the Group is reasonably certain to exercise
that option. Simultaneously, the Group recognises a right of
use asset in the amount of the lease liability.
The lease term is the non-cancellable period for which the
Group has the right to use an underlying asset, together with
both the periods covered by an option to extend the lease if
the Group is reasonably certain to exercise that option and
periods covered by an option to terminate the lease if the
Group is reasonably certain to exercise that option.
Financial statements
113 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
continued
s. IFRS 16 – “Leases” continued
After the commencement date, the Group measures the right
of use asset applying the cost model, less any accumulated
depreciation and any accumulated impairment losses and
adjusted for any remeasurement of the lease liability.
Assets are depreciated by the straight-line method over the
estimated useful lives of the right of use assets or the lease
period, whichever is shorter. The depreciation periods for the
real estate leases by the Group is between one to five years.
Under IFRS 16 all leases are recognised as a right of use asset
and a corresponding liability at the date at which the leased
asset is available for use by the Group. Each lease payment is
allocated between the liability and finance cost. The finance
cost is charged to the consolidated statement of
comprehensive income over the lease period so as to produce
a constant periodic rate of interest on the remaining balance
of the liability for each period.
Payments associated with short-term leases of real estate
and all leases of low-value assets are recognised on a
straight-line basis as an expense in the consolidated
statement of comprehensive income. Short-term leases are
leases with a lease term of 12 months or less without an
exercise option.
t. Business combinations
The acquisition method of accounting is used to account for
all business combinations, regardless of whether equity
instruments or other assets are acquired. The consideration
transferred for the acquisition of a subsidiary comprises:
+ fair values of the assets transferred; and
+ liabilities incurred to the former owners of the acquired
business
Identifiable assets acquired, and liabilities and contingent
liabilities assumed in a business combination are, with limited
exceptions, measured initially at their fair values at the
acquisition date.
Over the fair value of the net identifiable assets acquired is
recorded as goodwill. If those amounts are less than the fair
value of the net identifiable assets of the business acquired,
the difference is recognised directly in the consolidated
statement of comprehensive income as a bargain purchase.
Notes to the Consolidated Financial Statements continued
u. Intangible assets
1) Goodwill
Goodwill represents the surplus of the consideration that has
been transferred for the acquisition of a subsidiary company,
over the net amount of the identifiable assets and liabilities
that have been acquired as at the time of the acquisition.
Goodwill on acquisitions of subsidiaries is included in
intangible assets. Goodwill is not amortised but it is tested for
impairment annually, or more frequently if events or changes
in circumstances indicate that it might be impaired, and is
carried at cost less accumulated impairment losses.
Goodwill is allocated to cash-generating units for the purpose
of impairment testing. The allocation is made to those cash-
generating units or groups of cash-generating units that are
expected to benefit from the business combination in which
the goodwill arose. The units or groups of units are identified at
the lowest level at which goodwill is monitored for internal
management purposes
2) Licence
A licence acquired in a business combination is recognised at
fair value at the acquisition date. It has an indefinite useful life,
is not subject to amortisation and is tested annually for
impairment.
3) Customer relationships and technology
Customer relationships and technology acquired in a
business combination are recognised at fair value at the
acquisition date. They have a definite useful life of five years
and are subsequently carried at cost less accumulated
amortisation and impairment losses. The amortisation
expenses are recognised as part of general and administrative
expenses in the statement of comprehensive income.
v. Impairment of assets
Goodwill and intangible assets that have an indefinite useful
life are not subject to amortisation and are tested annually for
impairment, or more frequently if events or changes in
circumstances indicate that they might be impaired. Other
assets are tested for impairment whenever events or changes
in circumstances indicate that the carrying amount may not
be recoverable. An impairment loss is recognised for the
amount by which the asset’s carrying amount exceeds its
recoverable amount. The recoverable amount is the higher of
an asset’s fair value less costs of disposal and value in use. For
the purposes of assessing impairment, assets are grouped at
the lowest levels for which there are separately identifiable
cash inflows which are largely independent of the cash inflows
from other assets or groups of assets (cash-generating units).
Non-financial assets other than goodwill that suffered an
impairment are reviewed for possible reversal of the
impairment at the end of each reporting period.
114 Plus500 Ltd. Annual Report 2022
w. New International Financial Reporting Standards,
Amendments to Standards and New Interpretations
New and amended standards adopted by the Group for
the first time for the financial year beginning on or after
1 January 2023.
Definition of Material – Amendment to IAS 1 and IAS 8.
Disclosure of Accounting Policies – Amendments to IAS 1 and
IFRS Practice Statement 2.
The IASB amended IAS 1 to require entities to disclose their
material rather than their significant accounting policies. The
amendments define what is ‘material accounting policy
information’ and explain how to identify when accounting
policy information is material. They further clarify that
immaterial accounting policy information does not need to be
disclosed. If it is disclosed, it should not obscure material
accounting information.
To support this amendment, the IASB also amended IFRS
Practice Statement 2 Making Materiality Judgements to
provide guidance on how to apply the concept of materiality
to accounting policy disclosures.
The Amendment to IAS 1 will be applied retrospectively to
annual reporting periods commencing on 1 January 2023 or
thereafter. The first-time application of the Amendment to IAS 1
is not expected to have a material effect on the Group’s
consolidated financial statements.
NOTE 3 – SIGNIFICANT ACCOUNTING ESTIMATES
Considering uncertain tax positions
The assessment of amounts of current and deferred taxes
requires the Group’s management to take into consideration
uncertainties that its tax position will be accepted and of
incurring any additional tax expenses. This assessment is
based on estimates and assumptions based on interpretation
of tax laws and regulations, and the Group’s past experience. It
is possible that new information will become known in future
periods that will cause the final tax outcome to be different
from the amounts that were initially recorded. Such differences
will impact the current and deferred income tax assets and
liabilities in the period in which such determination is made.
See also Note 2j and Note 10.
Financial statements
115 Plus500 Ltd. Annual Report 2022
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NOTE 4 – TRADING INCOME
The trading income attributed to geographical areas according to the location of the customer is as follows:
Year ended 31 December
US dollars in millions 2022 2021
European Economic Area (EEA) 372.9 329.0
United Kingdom 100.4 88.9
Australia 67.2 61.6
Rest of the World 292.1 239.2
832.6 718.7
NOTE 5 – SELLING AND MARKETING EXPENSES
Year ended 31 December
US dollars in millions 2022 2021
Payroll and related expenses 24.2 21.4
Variable bonuses 8.6 8.8
Share based compensation 6.1 4.0
Commissions to media buying 13.5 20.7
Advertising and technology costs 144.3 151.4
Commissions to processing companies 44.9 40.8
Server and data feeds commissions 14.6 11.7
Other 45.9 21.0
302.1 279.8
NOTE 6 – ADMINISTRATIVE AND GENERAL EXPENSES
Year ended 31 December
US dollars in millions 2022 2021
Payroll and related expenses 16.3 11.6
Variable bonuses 10.4 5.4
Share based compensation 15.3 7.7
Professional and regulatory fees 23.0 18.5
Depreciation and amortisation 3.4 2.5
Other 11.7 8.6
80.1 54.3
Notes to the Consolidated Financial Statements continued
116 Plus500 Ltd. Annual Report 2022
NOTE 7 – OPERATING EXPENSES
The presentation below reflects the breakdown of operating expenses by nature of expense:
Year ended 31 December
US dollars in millions 2022 2021
Employee benefits and other related expenses 80.9 58.9
IT and technology costs 50.4 38.2
Commissions to processing companies 44.9 40.8
Advertising, marketing and commissions to media buying 122.0 145.6
Professional and regulatory fees 23.0 18.5
Depreciation and amortisation 3.4 2.5
Other 57.6 29.6
382.2 334.1
In the years ended 31 December 2022 and 2021, IT and technology costs together with additional allocated other technological
related costs were $74.4 million and $58.4 million, respectively.
NOTE 8 – AUDITORS’ REMUNERATION
Year ended 31 December
US dollars in millions 2022 2021
Audit of Plus500 Ltd’s consolidated financial statements 0.3 0.3
Audit of Plus500 Ltd’s subsidiaries 0.3 0.3
Total audit fees 0.6 0.6
Other assurance related services 0.3 0.3
Tax compliance services 0.5 0.7
Total non-audit fees 0.8 1.0
Total fees 1.4 1.6
Financial statements
117 Plus500 Ltd. Annual Report 2022
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NOTE 9 – SHARE BASED COMPENSATION
a. Cash settled share based compensation programmes
1) Background
The Group grants Share Appreciation Rights to selected employees and service contractors (the “Grant”).
The rights are settled in cash at the end of the period of two or three years following the Grant date for those who remain
employed or continue to render services as service contractors by the Group.
The rights represent the total Grant amounts divided by the average closing price of the ordinary shares of the Company on the
Main Market over the course of the 60 trading days immediately preceding the dates of the Grant (the “Share Price on Grant
Date”).
As of the end of each period, the fair value of the rights is calculated by the total Grant amounts on grant date, multiplied by the
average closing price of the ordinary shares of the Company on the Main Market over the course of the 60 trading days
immediately preceding the end of each period (or the payout date) including shareholder returns paid between the grant date
and the end of each period (or the vesting date) divided by the Share Price on Grant Date, as prorated over the period.
2) The following table specifies the dates of grants and the grant rights as of each date
Grant Date Vesting Date
Share
price
Number of
rights granted*
Number of
Employees
31 December 2019 31 December 2022 797.85 2,925 5
12 February 2020 12 February 2022 855.46 40 2
31 August 2020 31 August 2022 1,303.93 97 6
30 December 2020 30 December 2022 1,507.08 2,342 127
30 December 2020 30 December 2023 1,507.08 647 3
28 February 2021 28 February 2023 1,411.13 13 1
31 August 2021 31 August 2023 1,404.43 14 1
31 December 2021 31 December 2023 1,320.98 1,136 55
28 February 2022 28 February 2024 1,409.47 3 1
2 May 2022 2 May 2024 1,464.36 9 1
30 June 2022 30 June 2024 1,545.33 37 2
3) Cash settled share based compensation liability
As at 31 December
US dollars in millions 2022 2021
Current liability 6.3 7.3
Non-current liability – 0.3
6.3 7.6
4) Cash settled share based compensation expenses
Year ended 31 December
US dollars in millions 2022 2021
Selling and marketing expenses 3.2 4.0
Administrative and general expenses 8.7 2.8
11.9 6.8
Notes to the Consolidated Financial Statements continued
118 Plus500 Ltd. Annual Report 2022
5) Cash settled share based compensation – number of rights outstanding
Number of rights
2022 2021
Opening balance as at 1 January 5,672 8,768
Rights granted 49 1,163
Rights vested (3,943) (3,208)
Rights forfeited (259) (1,051)
Closing balance as at 31 December 1,519 5,672
During 2022 and 2021, 3,943 and 3,208 rights were vested in total amount of $11.2 million and $6.9 million, respectively. The
average vesting price based on GBP pence per granted right was approximately $2,843 and $2,160, respectively.
b. Equity settled share based compensation programmes
Background
The Group grants long-term incentive plans (“LTIPs”) to selected employees and service contractors (the “LTIP Grants”). In
addition, the Group grants Restricted Stock Units (“RSUs”) to selected employees located in Israel (the “RSUs Grants”). The Group
also grants in respect of certain projects, bonuses with a partial deferred element settled in ordinary shares of the Company to
selected service contractors and employees (the “Deferred Bonuses”).
During 2022 and 2021, the Group recognised $9.5 million and $4.9 million, respectively, as expenses in respect of the equity share
based compensation plans and Deferred Bonuses in the consolidated statement of comprehensive income with an increase
in equity of $7.5 million and $4.9 million, respectively.
As of 31 December 2022 and 2021, retained earnings include an amount of $5.8 million and $3.5 million, respectively, in respect of
the equity share based compensation and Deferred Bonuses plans.
1) LTIP Grants
The following table specifies the dates of LTIP Grants and the number of ordinary shares as of each date, as granted for
employees and service contractors
Grant Date Vesting Date
Share price
(GBP)
Number of
ordinary shares
granted on
grant date
Number of
employees and
service
contractors
1 January 2020 31 December 2022 8.86 75,627 7
1 January 2021 31 December 2023 14.50 122,496 7
2 January 2022 31 December 2024 12.91 153,134 7
The 2020 LTIP Grants were vested on 31 December 2022 and the Company issued 177,386 of its treasury shares.
The 2022, 2021 and 2020 LTIP Grants are subject to service conditions and additional Key Performance Indicators (“KPIs”),
measurements, including market and performance conditions.
During 2022 and 2021, 12,965 and nil ordinary shares in respect of LTIP Grants were forfeited, respectively.
The final number of ordinary shares to be allotted on the vesting date will be determined according to the share price at the
grant date, less the accumulated amount of shareholder returns paid during the vesting period.
The fair value at grant date of the LTIP Grants is measured according to the value of the grant amount and expensed over the
vesting period with a corresponding increase in equity, taking into account the best available estimate of the number of shares
expected to vest under the service and performance conditions.
On the vesting date the Company shall allot to the employee or service contractor, ordinary shares, subject to the service
condition and achieving specific KPIs for each grant.
Financial statements
119 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
NOTE 9 – SHARE BASED COMPENSATION continued
b. Equity settled share based compensation programmes continued
The allotted ordinary shares will be transferred out of the treasury shares of the Company.
The ordinary shares allotted on the vesting date, which are subject to a lock-up period, shall be subject to a two-year lock-up
beginning on the vesting date.
2) RSUs Grants
The following table specifies the dates of RSUs Grants and the number of units as of each date.
Grant Date Vesting Date
Share price
(GBP)
Number of
RSUs granted
Number of
employees
1 January 2020 31 December 2022 8.86 116,045 8
1 January 2021 31 December 2023 14.50 160,926 8
2 January 2022 31 December 2024 12.91 346,999 137
2 January 2022 31 December 2022 12.91 84,015 130
2 January 2022 31 December 2023 12.91 84,015 130
1 July 2022 30 June 2023 15.96 3,702 10
1 July 2022 30 June 2024 15.96 3,702 10
1 July 2022 30 June 2025 15.96 3,702 10
In respect of RSU Grants which were vested on 31 December 2022, the Company issued 175,272 of its treasury shares.
Each RSU represents the right to receive one ordinary share, par value of NIS 0.01 per share, subject to the terms and conditions
of the grant as approved by the Board of Directors and in accordance with the provisions of the Capital Gain route under
section 102 of the Israeli Tax Ordinance and regulations (the “102 Capital Gain route”).
In respect of the RSUs granted, the employees are entitled to the RSUs upon completing the service period. Part of the RSUs
granted include also KPIs with market and performance conditions.
During 2022 and 2021, 14,741 and 32,430 RSUs were forfeited, respectively.
The fair value at grant date of the RSUs Grants is measured according to the value of the grant amount and expensed over the
vesting period with a corresponding increase in equity, taking into account the best available estimate of the number of RSUs
expected to vest under the service and performance conditions.
On the vesting date, the employees shall be entitled to a cash payment equal to the aggregate shareholder returns that were
payable in each grant vesting period with respect to the number of issued shares that were actually allotted to the employees
on the vesting date with respect to the RSUs.
The allotted ordinary shares will be transferred out of the treasury shares of the Company. On the vesting date, the shares will be
transferred to a trustee by the Company.
The ordinary shares allotted on the vesting date, which are subject to a lock-up period, shall be subject to a two-year lock-up
beginning on the vesting date.
3) Deferred Bonus Grants
The following table specifies the dates of Deferred Bonuses Grants and the number of shares as of each grant date.
The employees and service providers are entitled to the Deferred Bonuses upon completing a service period of one year and
subject to achieving additional KPIs.
The 2020 and 2019 Deferred Bonuses shall be paid in three equal instalments beginning on 31 December of the year after the
vesting date, by way of allotment of ordinary shares of the Company. The number of ordinary shares allotted on any deferred
payment date shall be calculated based on the ordinary share price on grant date, as adjusted for shareholder returns.
The 2022 and 2021 Deferred Bonuses were paid in one instalment on 31 December of the bonus year, by way of allotment of
ordinary shares of the Company. The number of ordinary shares allotted on the deferred payment date was calculated based
on the ordinary share price on grant date, as adjusted for shareholder returns.
Notes to the Consolidated Financial Statements continued
120 Plus500 Ltd. Annual Report 2022
Grant Date Vesting Date
Share price
(GBP)
Number of
ordinary
shares on
grant date
Number of
employees and
service
contractors
1 January 2021 31 December 2021 14.50 53,904 2
2 January 2022 31 December 2022 12.91 63,274 2
On 31 December 2022 and 2021, the Company issued a total of 127,485 and 88,276 of its treasury shares, in accordance with the
Deferred Bonuses Grants, in respect of the grants for the years 2019, 2020, 2021 and 2022, as applicable.
The Company recognised the value of the issued shares on 31 December 2022 according to the fair value measured for each
Grant on the grant date.
NOTE 10 – INCOME TAX EXPENSE
Law for the Encouragement of Capital Investments, 5719-1959
The Law for the Encouragement of Capital Investments, 5719-1959, generally referred to as the “Investment Law”, provides
certain incentives for capital investments in production facilities (or other eligible assets) by “Industrial Enterprises” (as defined
under the Investment Law).
New tax benefits under the 2017 Amendment that became effective on 1 January 2017 (“2017 Amendment”)
The 2017 Amendment was enacted as part of the Economic Efficiency Law that was published on 29 December 2016, and is
effective as of 1 January 2017. The 2017 Amendment provides new tax benefits, as described below, and is in addition to the other
existing tax beneficial programmes under the Investment Law.
The 2017 Amendment provides that a technology company satisfying certain conditions will qualify as a Preferred Technological
Enterprise (“PTE”) and will thereby enjoy a reduced corporate tax rate of 12% on income that qualifies as Preferred Technology
Income, as defined in the Investment Law.
Dividends distributed by a PTE, paid out of Preferred Technology Income, are generally subject to withholding tax at source at
the rate of 20% or such lower rate as may be provided in an applicable tax treaty.
a. Company taxation in Israel
The full corporate tax rate in Israel for the years 2022 and 2021 is 23%.
Under the 2017 Amendment, provided the conditions stipulated therein are met, technological income derived by Preferred
Companies from “Preferred Technological Enterprise” (as defined in the 2017 Amendment), would be subject to reduced
corporate tax rates of 12%.
A Preferred Company distributing dividends from technological income derived from its PTE would generally subject the
recipient to a 20% tax (or lower, if so provided under an applicable tax treaty).
In May 2019, the Company obtained a tax ruling from the ITA and subject to the Company complying with the conditions
stipulated by the tax ruling, which the Company met, and the Investment Law, the Company is considered as a PTE.
At the beginning of July 2020, the Company received an approval from the Israeli Innovation Authority (“IIA”) that together with
the tax ruling received from the ITA in May 2019, recognises the Company as a PTE for the years 2017, 2018 and 2019. Accordingly,
the applicable tax rate for the preferred technological income of a PTE for these years was 12%. The Company is also considered
as PTE for the years 2021 and 2020. As a result, the Company’s corporate tax rate for the years 2021 and 2020 was 12%, subject
to the Company complying with the conditions of the Law for the Encouragement of Capital Investments.
In January 2022, the Company’s status as a PTE, as accredited by the ITA under the tax regime in Israel, has been extended for
the financial years 2022, 2023, 2024, 2025 and 2026, subject to the Company complying with the conditions of the Law for the
Encouragement of Capital Investments. Consequently, the Company’s corporate tax rate for each of these years will be
reduced from 23% to 12% and the withholding tax rate applicable for dividends will be reduced from 25% to 20%.
In January 2021, the Company received approximately $30.0 million rebates (including interest) reflecting the reduced tax rate
for FY 2017 and in August 2021, the Company received approximately $37.2 million in tax rebates (including interest) reflecting the
reduced tax rate for FY 2019.
Financial statements
121 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
NOTE 10 – INCOME TAX EXPENSE continued
b. Tax assessments
The Company has final tax assessments up to the year 2019.
The assessments of amounts of current and deferred taxes require the Group’s management to take into consideration
uncertainties that its tax position will be accepted and of incurring any additional tax expenses. This assessment is based on
estimates and assumptions based on interpretation of tax laws and regulations, and the Group’s past experience. It is possible
that new information will become known in future periods that will cause the final tax outcome to be different from the amounts
that were initially recorded, such differences will impact the current and deferred income tax assets and liabilities in the period
in which such determination is made.
c Corporate taxation in subsidiaries
Principal tax rate
Subsidiary 2022 2021 Tax regulation
UK 19% 19% Tax laws in United Kingdom
CY 12.5% 12.5% Tax laws in Cyprus
AU 30% 30% Tax laws in Australia
Other Group subsidiaries do not have significant taxable income and the overall effect of the income of those subsidiaries on
the Group’s tax expenses is immaterial.
d. Deferred income taxes
Deferred tax assets
The deferred income tax assets relate mainly to payroll and related expenses of the share based compensation plans (see
Note 9). The deferred tax assets were computed in 2022 and 2021 at tax rates of 12% and 23%, respectively.
Deferred tax liability
The deferred tax liabilities are related to intangible assets recognised through business combination, see Note 24.
e. Taxes on income included in the consolidated income statements for the reported years
Year ended 31 December
US dollars in millions 2022 2021
Current taxes:
Current taxes in respect of current year’s profits 103.5 77.6
Tax income in respect of previous years 0.5 0.5
104.0 78.1
Deferred income taxes:
Change of deferred tax assets (see Note 10d) (0.1) (2.3)
Taxes on income expenses 103.9 75.8
Notes to the Consolidated Financial Statements continued
122 Plus500 Ltd. Annual Report 2022
f. Reconciliation of the theoretical tax expense
Following is a reconciliation of the theoretical tax expense, assuming all income is taxed at the regular corporate tax rate
applicable to a company in Israel (see Note 10a) and the actual tax expense:
Year ended 31 December
US dollars in millions 2022 2021
Income before taxes on income, as reported in the consolidated income statement 474.3 386.4
Theoretical tax expense in respect of this year’s income – at 23% 109.1 88.9
Less tax benefits arising from preferred technological income in respect of the current year (14.5) (4.3)
Decrease in taxes resulting from different tax rates applicable to foreign subsidiaries (2.1) (0.8)
Impact of change in tax rates on deferred tax balances and temporary differences (2.3) (2.8)
Increase (decrease) in taxes in respect of currency differences and expenses not deductible for tax
purposes 13.2 (5.7)
Tax income in relation to previous years 0.5 0.5
Taxes on income for the reported year 103.9 75.8
NOTE 11 – EARNINGS PER SHARE
Earnings per share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average
number of ordinary shares in issue during the year.
Year ended 31 December
2022 2021
Profit attributable to equity holders of the Company (US dollars in millions) 370.4 310.6
Weighted average number of ordinary shares in issue*:
Basic 97,311,485 101,456,641
Dilutive effect of equity share based compensation 943,047 529,601
Diluted 98,254,532 101,986,242
Basic earnings per share (In US dollars) 3.81 3.06
Diluted earnings per share (In US dollars) 3.77 3.05
*After weighting the effect of the Company’s share buyback programmes. See Note 12.
NOTE 12 – COST OF COMPANY’S SHARES HELD BY THE COMPANY
The Board of Directors approves share buyback programmes. The share buyback programmes are funded from the Company’s
net cash balances.
Year ended 31 December
Number of ordinary
shares purchased
Aggregate purchase
amount (US $ in millions)
Average price of
shares purchased
2021 3,406,2 1 1 64.9 £13.90
2022 6,943,359 138.8 £16.27
During the years ended 31 December 2022 and 2021, the Company issued 494,308 and 179,537 of its treasury shares, respectively,
in accordance with the various share based equity settled compensation grants.
During the period starting 1 January 2023 and up to 21 March 2023, as the latest practicable date before the signing date of the
consolidated financial statements, the Company purchased an additional 2,044,677 ordinary shares (or 1.78%) in the capital of
the Company for an aggregate purchase amount of $45.0 million pursuant to these share buyback programmes. The ordinary
shares were bought back at an average price of £18.28.
Financial statements
123 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
NOTE 13 – DIVIDENDS
The amounts of dividends and the amounts of dividends per share for the years 2022 and 2021 declared and distributed by the
Company’s Board of Directors are as follows:
Date of declaration
Amount of dividend
(US $ in millions)*
Amount of dividend
per share (US $)
Date of payment
to shareholders
17 February 2021 84.9 0.8292 12 July 2021
17 August 2021 60.0 0.592 1 11 November 2021
15 February 2022 59.9 0.5995 11 July 2022
17 August 2022 60.0 0.6238 11 November 2022
On 14 February 2023, the Company declared a final dividend and a special dividend in the amounts of $20.0 million and $10.0
million, respectively (see Note 28).
* Between the dividend announcement date and the record date of the dividend, the number of issued and outstanding ordinary shares of the
Company decreased as a result of the repurchase by the Company of ordinary shares during such period and the classification of such repurchased
ordinary shares as treasury shares that are not entitled to dividends. However, this did not affect the dividend per share as announced on the dividend
announcement date.
NOTE 14 – OTHER RECEIVABLES AND OTHERS
As of 31 December
US dollars in millions 2022 2021
Securities at fair value 6.0 18.2
Prepaid expenses 7.7 5.2
Other 13.2 9.3
26.9 32.7
All the financial assets included among other receivables and others are for relatively short periods. Therefore, their fair values
approximate or are similar to their carrying amounts.
NOTE 15 – PROPERTY, PLANT AND EQUIPMENT
Composition of assets, grouped by major classifications and changes therein in 2022 is as follows:
US dollars in millions
Computers,
office equipment
and others
Leasehold
improvements Total
Cost
Balance at beginning of year 2.9 4.0 6.9
Additions 0.5 0.3 0.8
Balance at end of year 3.4 4.3 7.7
Accumulated depreciation
Balance at beginning of year 2.0 2.3 4.3
Additions 0.4 0.4 0.8
Balance at end of year 2.4 2.7 5.1
Depreciated balance as of 31 December 2022 1.0 1.6 2.6
Depreciated balance as of 31 December 2021 0.9 1.7 2.6
Notes to the Consolidated Financial Statements continued
124 Plus500 Ltd. Annual Report 2022
NOTE 16 – CASH AND CASH EQUIVALENTS
Cash and cash equivalents by currency of denomination:
As of 31 December
US dollars in millions 2022 2021
USD 781.9 728.0
EUR 176.8 181.2
GBP 73.2 68.1
AUD 45.7 54.0
NIS 31.0 20.8
Other 94.0 47.4
Gross cash and cash equivalents 1,202.6 1,099.5
Less: segregated client funds (272.4) (350.0)
Own cash and cash equivalents 930.2 749.5
NOTE 17 – OTHER PAYABLES
As of 31 December
US dollars in millions 2022 2021
Payroll and related expenses 36.2 24.6
Accrued expenses 34.7 16.4
Other 1.3 0.7
72.2 41.7
The financial liabilities included among other payables are for relatively short periods. Therefore, their fair values approximate
or are similar to their carrying amounts.
NOTE 18 – SERVICE SUPPLIERS
Service suppliers are comprised mainly of amounts due to advertising service suppliers, their fair values approximate or are
similar to their carrying amounts.
NOTE 19 – TRADE PAYABLES – DUE TO CLIENTS
As of 31 December
US dollars in millions 2022 2021
Customers’ deposits, net* 282.8 350.6
Segregated client funds (272.4) (350.0)
10.4 0.6
*Customers deposits, net are comprised of the following:
Customers’ deposits 411.5 428.3
Less – financial derivative open positions:
Gross amount of assets (139.0) (130.4)
Gross amount of liabilities 10.3 52.7
282.8 350.6
* The total amount of ‘Trade payables – due to clients’ includes bonuses to clients
Financial statements
125 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
NOTE 20 – LEASES
The Group has real estate lease agreements.
a) Right of use assets:
US dollars in millions
Real estate leases 2022 2021
At 1 January 5.6 6.0
Additions 2.0 2.7
Disposals – (0.6)
Modification – (0.7)
Amortisation (2.0) (1.8)
At 31 December 5.6 5.6
b) Lease liabilities:
US dollars in millions
Real estate leases 2022 2021
At 1 January 6.2 6.9
Additions 2.0 2.7
Disposals – (0.7)
Modification – (0.9)
Interest expense 0.1 0.2
Lease payments (2.3) (2.0)
Exchange differences (0.4) –
At 31 December 5.6 6.2
NOTE 21 – COMMITMENTS
a. The Company and Club BSC Young Boys Betriebs AG (“BSC Young Boys”) entered into a sponsorship agreement on 2 June
2020 under which the Company is entitled to advertise and promote itself as the main sponsor of BSC Young Boys for the
2020/21, 2021/22 and 2022/23 seasons.
b. The Company and Club Legia Waeszawa S.A (“Legia”) entered into a sponsorship agreement on 9 August 2020 under which
the Company is entitled to advertise and promote itself as the main sponsor of Legia for the 2020/21, 2021/22 and 2022/23
seasons.
c. The Company and Club Atalanta Bergamasca Calcio SPA (“Atalanta”) entered into a sponsorship agreement on 18 August
2020 under which the Company is entitled to advertise and promote itself as the main sponsor of Atalanta for the 2020/21,
2021/22 and 2022/23 seasons.
d. The Company and the NBA’s Chicago Bulls entered on October 2022 into a multi-year sponsorship agreement to become an
official global partner of the Chicago Bulls on under which the Company is entitled to advertise and promote itself.
NOTE 22 – SHARE CAPITAL
Composed of ordinary shares of NIS 0.01 par value, as follows:
Number of ordinary shares as of 31 December
2022 2021
Authorised 300,000,000 300,000,000
Issued and fully paid 114,888,377 114,888,377
Less treasury shares * (21,112,648) (14,663,597)
Outstanding shares 93,775,729 100,224,780
* Number of accumulated ordinary shares that were purchased by the Company as part of the share buyback programmes, less issue of treasury shares.
Notes to the Consolidated Financial Statements continued
126 Plus500 Ltd. Annual Report 2022
NOTE 23 – GOODWILL AND OTHER INTANGIBLE ASSETS, NET
Goodwill and other intangible assets, net as at 31 December 2022 comprises of Regulatory licence of $28.6 million, Goodwill of
$8.6 million and Technology and Customer relationships, net of $1.5 million.
The Goodwill and Regulatory licence recorded in the Company’s accounts stems from the business combinations, see
Note 24.
The recoverable amount of a cash generating unit is based on the calculation of the value in use. As part of these calculations,
the Company used the pre-tax expected cash flows based on the cash generating unit’s past results, its budget for the next
year and the forecast for the following years. The recoverable amount of the cash generating unit was calculated by an external
party and reviewed by Company’s management. The valuation used a pre-tax discount rate of 20.5% and a terminal growth
rate of 2%.
As of 31 December 2022, the recoverable amounts of the cash generating unit are higher than their carrying amounts, and it
was not required to record impairment.
NOTE 24 – BUSINESS COMBINATION
USA business combination
On 19 July 2021, Plus500US Inc., a wholly owned subsidiary of the Company, completed the acquisition of all of the membership
interests of Cunningham Commodities LLC. (“Cunningham”), a regulated Futures Commission Merchant (“FCM”), and
Cunningham Trading Systems LLC. (“CTS”), a technology trading platform provider, operating in the futures and options on
futures market. The acquisition consideration was funded from the Company’s existing cash balances and was paid on
completion. The measurement period for the acquisition ended on 19 July 2022.
The assets and liabilities recognised as a result of this acquisition are as follows:
US dollars in
millions
Cash 0.5
Other receivables and others 6.0
Long term other receivables 0.4
Service suppliers (0.3)
Other payables (1.6)
Deferred tax liability (6.9)
Goodwill and other intangible assets 34.9
Net assets acquired 33.0
Japan business combination
On 21 March 2022, the Company completed the acquisition of 100% of the issued and outstanding share capital of EZ Invest
Securities, Co., Ltd. (“EZ Invest”). EZ Invest is licenced as a Type 1 Financial Instruments Business Operator, regulated by the
Financial Services Agency (FSA) in Japan. The acquisition consideration was funded from the Company’s existing cash
balances and was paid on completion. Net assets acquired were $4.8 million and comprised mainly of intangible assets of
$4.4 million. The measurement period for the acquisition ended on 21 March 2023.
Financial statements
127 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
NOTE 25 – RELATED PARTIES AND KEY MANAGEMENT
a. Key management personnel definition:
The Directors and other members of management are classified as Persons Discharging Management Responsibility (“PDMR”)
in accordance with IAS 24 and the Market Abuse Regulation.
The Directors’ Remuneration Report discusses all the benefits and share based compensations earned during the year and the
preceding year by the Directors.
b. Company’s liability in respect of related parties and key management services (part of other payable):
As at 31 December
US dollars in millions 2022 2021
Related party and key management liability 14.2 11.6
c. Expenses to related parties and key management:
Year ended 31 December
US dollars in millions 2022 2021
Payroll and related expenses and service fees (selling and marketing expenses) 6.7 6.6
Payroll and related expenses and service fees (administrative and general expenses) 14.7 10.0
Non-Executive Directors fees (administrative and general expenses) 1.4 1.1
The average number of key management personnel during the year was 20 (FY 2021: 21).
NOTE 26 – FINANCIAL RISK MANAGEMENT
The Group operates in the fields of OTC and share dealing, as well as futures and options on futures. In the field of OTC, the Group
engages only with individual clients and offers OTC referenced to shares, indices, commodities, options, ETFs, cryptocurrencies
and foreign exchange. In the field of share dealing, the Group engages only with individual clients and offers a wide range of
financial instruments comprised of the world’s most popular equities, listed on major exchanges worldwide. In the field of
futures and options on futures, the Group engages through its subsidiary in the US which is an FCM that clears and executes
futures contracts and options on futures contracts for customers.
The Group’s activities expose it to a variety of financial risks: market risk (including currency risk and price risk), credit risk and
liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks
to minimise potential adverse effects on the Group’s financial performance.
a. Market risk
Market risk is the risk that changes in market prices will affect the Group’s income or the value of its holdings of financial
instruments. This risk can be divided into market price risk and foreign currency risk, as described below.
The Group’s market risk is managed on a Group-wide basis and exposure to market risk at any point in time depends primarily
on short-term market conditions and the levels of client activity. The Group utilises market position limits for operational
efficiency. Not all net client exposures are hedged and the Group may have a substantial net position in any of the financial
markets in which it offers products. In 2021, the Group implemented targeted hedging, with a view to reducing market risk. This
focused approach continues to be deployed in certain circumstances going forward, as and when appropriate.
The Group’s OTC market risk policy incorporates a methodology for setting market position limits, consistent with the Group risk
appetite, for each financial instrument in which the Group OTC clients can trade.
These limits are determined based on the Group OTC clients’ trading levels, volatilities and the market liquidity of the underlying
financial product or asset class. The limits represent the maximum long and short client exposure that the Group will hold
without hedging the net OTC client exposure.
Notes to the Consolidated Financial Statements continued
128 Plus500 Ltd. Annual Report 2022
The Group’s real-time OTC market position monitoring system is intended to allow it to continually monitor its OTC market
exposure against these limits. If exposures exceed these limits, the Group either hedges or new OTC client positions are being
offered in a smaller size and partially could be rejected under the Group’s policy.
It is the approach of the Group to observe during the year the “natural” hedge arising from the Group’s global OTC clients in
order to reduce the Group’s net market exposure.
The Group’s exposure to market risk at any point in time depends primarily on short-term market conditions and client activities
during the trading day. The exposure at each statement of financial position date may therefore not be representative of the
market risk exposure faced by the Group over the year. The Group’s exposure to market risk is determined by the exposure limits
described above which change from time to time.
1. Market price risk
This is the risk that the fair value of a financial instrument fluctuates as a result of changes in market prices other than due to the
effect of transactional foreign currency exposures risk.
The Group has market price risk as a result of its OTC trading activities on shares, indices, commodities, options, ETFs,
cryptocurrencies and foreign exchange, part of which is naturally hedged as part of the overall market risk management. The
exposure is monitored on a Group-wide basis.
OTC exposure limits are set by the risk department and management for each financial instrument, and also for groups of
financial instruments where it is considered that their price movements are likely to be positively correlated. The exposures are
being reviewed by the Regulatory & Risk Committee.
Daily profit on OTC closed positions:
US dollars in millions 2022 2021
Highest profit 32.7 16.0
Highest loss (9.8) (3.9)
Average 2.1 1.9
2. Foreign currency risk
Transactional foreign currency exposures represent financial assets or liabilities denominated in currencies other than the
functional currency of the Group. Transaction exposures arise in the normal course of business.
Foreign currency risk is managed on a Group-wide basis, while the Group exposure to foreign currency risk is not considered by
the Board of Directors to be significant. The Group monitors transactional foreign currency risks including currency statement
of financial position exposures, equity, commodity, interest and other positions denominated in foreign currencies and trades
on foreign currencies.
If the US dollar had strengthened by 3% as at 31 December 2022, in respect of balances denominated in other currencies, with all
other variables unchanged, the exposure on income after taxes in respect of those balances would be a gain (loss) of $0.2
million in respect of EUR, ($0.3) million in respect of AUD, $0.4 million in respect of GBP and ($3.7) million in respect of NIS. The
exposure in respect of balances denominated in other currencies is immaterial.
Financial statements
129 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
NOTE 26 – FINANCIAL RISK MANAGEMENT continued
b. Credit risk
The Group operates a real-time mark-to-market OTC trading platform with customers’ profits and losses being credited and
debited automatically to their accounts.
Under the Group’s policy, OTC customers cannot owe the Group funds when losing more than they have in their accounts, all
OTC customer accounts are pre-funded.
OTC client credit risk – Client credit risk principally arises when a customer’s total funds deposited (margin and free equity) are
insufficient to cover any trading losses incurred. In particular, customer credit risk can arise where there are significant, sudden
movements in the market (e.g. due to high general market volatility or specific volatility relating to an individual financial
instrument in which a customer has an open position).
The Group’s OTC offering is margin-traded. If the market moves adversely by more than the customer’s maintenance margin,
the Group is exposed to customer credit risk.
The principal types of OTC customer credit risk exposures are managed by monitoring all customer positions on a real-time
basis. If customers’ funds are below the required margin level, customers’ positions are liquidated (margin call).
Institutional credit risk – The risk that financial counterparties will not meet their obligation, risking both client and the Group’s
assets.
The carrying amount of the Group’s financial assets represents their maximum exposure to credit risk.
The Group has no material financial assets that are past due or impaired as at the reporting dates.
As of 31 December 2022 and 2021, counterparties holding the Group’s cash and cash equivalents, credit cards, client funds and
deposits, have credit ratings as follows:
Credit Rating* 2022 2021
AAA to A- 95% 94%
BBB+ to B- 2% 2%
Remaining counterparties 3% 4%
* The financial institutions were rated by the same third party.
As of 31 December 2022 the amounts held by the remaining counterparties are held in several counterparties worldwide. The
balance in each of those counterparties does not exceed 2% (2021: 2%) of total cash and cash equivalents, credit cards, client
funds and deposits.
The Group’s largest credit exposure to any single bank as of 31 December 2022 was $370.1 million or 31% of the exposure to all
banks (2021: $240.1 million or 22%).
c. Concentration risk
Concentration risk is defined as all risk exposures with a loss potential which is large enough to threaten the solvency or the
financial position of the Group. In respect of financial risk, such exposures may be caused by credit risk, market risk, liquidity risk
or a combination or interaction of those risks .
Notes to the Consolidated Financial Statements continued
130 Plus500 Ltd. Annual Report 2022
d. Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting obligations arising from its financial liabilities that are
settled by delivering cash or other financial assets.
Liquidity risk is managed centrally and on a Group-wide basis. The Group’s approach to managing liquidity is to ensure it will
have sufficient liquidity to meet its financial liabilities when due, under both normal circumstances and stressed conditions.
The Group’s approach is to ensure that there will be no material liquidity mismatches with regard to liquidity maturity profiles
due to the very short-term nature of its financial assets and liabilities.
A result of this policy is that short-term liquidity “gaps” can potentially arise in periods of very high client activity or significant
increases in global financial market levels.
The contractual maturity of the financial liabilities to service suppliers is generally up to two months.
e. Capital management
1) Plus500UK
The UK Subsidiary is regulated by the FCA.
The UK Subsidiary manages its capital resources on the basis of regulatory capital requirements and its own assessment of
capital required to support all material risks throughout the business. The UK Subsidiary manages its regulatory capital through
an Internal Capital Adequacy and Risk Assessment process (known as the ICARA) in accordance with guidelines and rules
implemented by the FCA. Both assessments are compared with total available regulatory capital on a daily basis and
monitored by the management of the Group.
As at 31 December 2022 and 2021, the UK Subsidiary had GBP 51.7 million and GBP 43.9 million, respectively, of eligible capital
which is in excess of both its regulatory capital requirement and the internally measured capital requirement.
2) Plus500CY
The CY Subsidiary is regulated by CySEC.
The CY Subsidiary manages its capital resources on the basis of regulatory capital requirements (“Pillar 1”) and its own
assessment of capital required to support all material risks throughout the business (“Pillar 2”). The CY Subsidiary manages its
regulatory capital through an Internal Capital Adequacy and Risk Assessment (“ICARA”) process in accordance with guidelines
and rules implemented by CySEC.
The CY Subsidiary monitors on a frequent basis its Pillar 1 capital requirements and ensures that its capital and liquidity position
remains always above the minimum regulatory thresholds. As of 31 December 2022 and 2021, the CY Subsidiary held
EUR 107.2 million and EUR 90.4 million, respectively, of eligible capital which is in excess of both its regulatory capital requirement
(Pillar 1) and the internally measured capital requirement (Pillar 2).
As of the 26 June 2021, the capital adequacy and overall risk management requirements that applied to the CY Subsidiary
under the Capital Requirements Regulation & Directive (“CRR & CRDIV”) prudential framework, have been replaced by amended
prudential rules. The Internal Capital Adequacy Assessment Process (“ICAAP”) were replaced by ICARA.
As at 31 December 2022 and 2021, the CY Subsidiary’s Pillar 1 Capital Adequacy ratio on a transitional basis was 253.1% and 174.1%
respectively. Moreover, the CY Subsidiary is evaluating its overall risk profile and capital position through its ICARA process,
which is performed at least on an annual basis.
3) Plus500AU
The AU Subsidiary is regulated by ASIC, FMA and FSCA.
The AU Subsidiary manages its capital resources on the basis of regulatory capital requirements and its own assessment of
capital required to support all material risks. The AU Subsidiary manages its capital through its Net Tangible Assets (“NTA”)
assessment in accordance with rules and guidelines implemented by ASIC and FMA and Capital Liquidity assessment in
accordance with rules and guidelines implemented by FSCA.
As at 31 December 2022 and 2021, the AU Subsidiary held AUD 43.8 million and AUD 38.2 million, respectively, of eligible capital,
which is in excess of its NTA requirements from ASIC, FMA and FSCA.
Financial statements
131 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
NOTE 26 – FINANCIAL RISK MANAGEMENT continued
e. Capital Management continued
4) Plus500SG
The SG Subsidiary is regulated by MAS.
The SG Subsidiary manages its capital resources on the basis of regulatory capital requirements and its own assessment of
capital required to support all material risks. The SG Subsidiary manages its capital in accordance with rules and guidelines
implemented by MAS.
As at 31 December 2022 and 2021, the SG Subsidiary held SGD 8.6 million and SGD 8.3 million, respectively, of eligible capital,
which is in excess of its MAS requirements.
5) Plus500IL
The IL Subsidiary is regulated by ISA.
The IL Subsidiary manages its capital resources on the basis of regulatory capital requirements and its own assessment of
capital required to support all material risks. The IL Subsidiary manages its capital in accordance with rules and guidelines
implemented by ISA.
As at 31 December 2022 and 2021, the IL Subsidiary held NIS 35.8 million and NIS 34.8 million, respectively, of eligible capital, which
is in excess of its ISA requirements.
6) Plus500SEY
The SEY Subsidiary is regulated by FSA.
The SEY Subsidiary manages its capital resources on the basis of regulatory capital requirements and its own assessment of
capital required to support all material risks. The SEY Subsidiary manages its capital in accordance with rules and guidelines
implemented by FSA.
As at 31 December 2022 and 2021, the SEY Subsidiary held sufficient levels of eligible capital, which is in excess of its FSA
requirements.
7) Cunningham Commodities
Cunningham Commodities is a Futures Commission Merchant (“FCM”) registered with the CFTC and is a member of the National
Futures Association (“NFA”).
As at 31 December 2022 and 2021, the Cunningham Commodities Subsidiary had a net capital of USD 86.1 million and
USD 22.0 million, respectively, which is in excess of CFTC Regulation 1.17 and the minimum capital requirements of the CME Group
Inc.
8) Plus500EE
The EE Subsidiary is regulated by EFSA.
The EE Subsidiary manages its capital resources on the basis of regulatory capital requirements and its own assessment of
capital required to support all material risks. The EE Subsidiary manages its capital in accordance with rules and guidelines
implemented by EFSA.
As at 31 December 2022, the EE Subsidiary held EUR 5.4 million of eligible capital, which is in excess of its EFSA requirements.
9) Plus500JP
The JP Subsidiary is regulated by FSA.
The JP Subsidiary manages its capital resources on the basis of regulatory capital requirements and its own assessment of
capital required to support all material risks. The JP Subsidiary manages its capital in accordance with rules and guidelines
implemented by FSA.
As at 31 December 2022, the JP Subsidiary held JPY 590.5 million, of eligible capital, which is in excess of its FSA requirements.
Notes to the Consolidated Financial Statements continued
132 Plus500 Ltd. Annual Report 2022
f. Other business risks
The Group’s business is subject to various laws and regulations in different countries according to its activity and other countries
from where the Company operates. Any regulatory actions, tax or legal challenges against the Group for non-compliance with
any regulatory or legal requirement could result in significant fines, penalties, or other enforcement actions, increased costs of
doing business through adverse judgement or settlement, reputational harm, the diversion of significant amounts of
management time and operational resources, and could require changes in compliance requirements or limits on the Group’s
ability to expand its product offerings, or otherwise harm or have a material adverse effect on the Group’s business.
g. Fair value estimation
Financial derivative open positions (offset from, or presented with, deposits from clients within “Trade payable – due to clients”)
(see also Note 19) are measured at fair value through profit or loss using valuation techniques. The said valuation techniques
are based on inputs other than quoted prices in active markets that are observable for the asset or liability, either directly (that
is, as prices) or indirectly (that is, derived from prices).
These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on
entity specific estimates. All significant inputs required for the fair value estimations of the said instruments are observable.
Specific valuation techniques used to value financial instruments are based on quoted market prices at the consolidated
statement of financial position date and an additional predetermined amount (trading spread).
NOTE 27 – CASH GENERATED FROM OPERATIONS
Year ended 31 December
US dollars in millions 2022 2021
Cash generated from operating activities
Net income for the year 370.4 310.6
Adjustments required to reflect the cash flows from operating activities:
Depreciation and amortisation 1.4 0.7
Amortisation of right of use assets 2.0 1.8
Lease modification – (0.2)
Liability for share based compensation 11.9 6.8
Settlement of share based compensation (7.3) (8.4)
Equity share based compensation 7.5 4.9
Taxes on income 103.9 75.8
Interest expenses in respect of leases 0.1 0.2
Exchange differences in respect of leases (0.4) –
Interest income (13.5) (6.2)
Foreign exchange losses (gains) on operating activities (4.5) 4.3
101.1 79.7
Operating changes in working capital:
Decrease (increase) in other receivables and others 5.2 (16.9)
Increase (decrease) in trade payables due to clients 9.8 (0.4)
Increase (decrease) in other payables 24.1 17.3
Increase (decrease) in service suppliers (3.8) (7.3)
35.3 (7.3)
Cash generated from operations 506.8 383.0
Financial statements
133 Plus500 Ltd. Annual Report 2022
GovernanceStrategic report
NOTE 28 – SUBSEQUENT EVENTS
In February 2023, the Group obtained a licence in the United Arab Emirates, granted by the Dubai Financial Services Authority
(DFSA).
On 14 February 2023, the Company declared a final dividend in an amount of $20.0 million ($0.2156 per share). The dividend
record date is 24 February 2023 and it will be paid to the shareholders on 11 July 2023.
On 14 February 2023, the Company declared a special dividend in an amount of $10.0 million ($0.1078 per share). The dividend
record date is 24 February 2023 and it will be paid to the shareholders on 11 July 2023.
On 14 February 2023, the Company declared the adoption of a share buyback programme to buy back up to $70.0 million of the
Company’s ordinary shares, comprised of a final share buyback programme in the amount of $42.4 million and a special share
buyback programme in the amount of $27.6 million.
Notes to the Consolidated Financial Statements continued
134 Plus500 Ltd. Annual Report 2022
FURTHER INFORMATION
Sponsor and Joint Broker
Liberum Capital Limited
Ropemaker Place
25 Ropemaker Street
London EC2Y 9LY, UK
Joint Broker
Jefferies International Limited
100 Bishopsgate
London EC2N 4JL, UK
Independent Auditors
Kesselman & Kesselman,
a member firm of
PricewaterhouseCoopers
International Limited
146 Derech Menachem
Begin Street
Tel Aviv 6492103,
Israel
Financial PR
Brunswick Group LLP
16 Lincoln’s Inn Fields
London WC2A 3ED, UK
Legal Advisor (Israel)
Herzog, Fox & Neeman
Herzog Tower
6 Yitzhak Sadeh Street
Tel Aviv 6777504,
Israel
Legal Advisor (United Kingdom)
Bryan Cave Leighton Paisner LLP
Governor’s House
5 Laurence Pountney Hill
London EC4R 0BR, UK
Depositary
Link Market Services Trustees
Limited
Central Square
29 Wellington Street
Leeds LS1 4DL, UK
Registrar
Link Market Services Limited
Central Square
29 Wellington Street
Leeds LS1 4DL, UK
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