Flow Traders Ltd. (FLOW) Earnings Call Transcript & Summary

Hello, and welcome to the Flow Traders Second Quarter 2026 Results Conference Call. I would now like to hand over the call to Dick Peters. Please go ahead.

Thank you. Good morning, and thank you for joining Flow Traders Second Quarter 2026 results presentation. As you may have seen, we published our results earlier this morning. I'm joined by our CEO, Thomas Spitz, and our Co-Chief Trading Officer, Marc Jansen, who will take you through the results. As for our prepared remarks, we will be happy to take any questions you may have. Before we begin, let me draw your attention to the disclaimer on Page 2. As always, this presentation is for information purposes only and the results we will be discussing are unaudited. I will now hand over to Thomas for the update.

Thank you, Dick. And let me start with a high-level overview of our Q2 performance. We delivered a solid second quarter, resulting in a net profit of EUR 40.8 million and an earnings per share of EUR 0.93. Our ETF value traded increased 34% year-on-year and was flat quarter-on-quarter while market volumes were down 14% quarter-on-quarter. In Q2, we generated a net trading income of EUR 147.8 million, which equates to 53% return on trading capital. Our NTI consisted of EUR 131.7 million NTI in our traditional business and EUR 16.1 million in our digital assets business. Fixed operating expenses were EUR 59.3 million in line with our revised guidance of EUR 235 million to EUR 245 million for the year. EBITDA reached EUR 63.6 million for Q2, which equates to an EBITDA margin of 43%. We ended the quarter with 641 FTEs down from 656 at the end of Q1 2026. Overall, we delivered steady diversified results across regions and products. I will now hand it over to Marc to walk you through the market environment and regional performance.

Thank you, Thomas, and good morning, everyone. ETF AUM continued its strong trajectory and increased 41% year-on-year and 16% quarter-on-quarter. Continued growth is driven by increased fund inflows, combined with strong year-on-year market performance. The global ETF market showed reduced activity in Q2 with ETF value traded 14% down quarter-on-quarter, marking the first down quarter since Q2 '24. Year-on-year ETF value traded is up 33%. Implied volatility reduced in Q2 as the situation in the Middle East moved to a ceasefire. ETP velocity, the ratio between ETP value traded and AUM decreased both quarter-on-quarter and year-on-year. This decrease typically correlates with the decrease in volatility as you can see by comparing the 2 charts at the bottom of the page. Overall, fundamentals remain supportive of continued long-term growth in the global ETF markets. Moving on. Since the start of the year, the Bitcoin price is down 33% and it's down 53% since its peak in October 2025. The overall market cap of the crypto markets moved in tandem with the price changes observed in Bitcoin. Global crypto ETF value traded was down 28% quarter-on-quarter as activity remains subdued. Year-on-year, global crypto ETF value traded was up 11%. Strong momentum in tokenized markets continued with tokenized assets increasing by 15% quarter-on-quarter. Despite the recent trends in crypto, structural growth trends for digital assets remain in place. I'll now move on to our regional performance overview of our traditional business. In Europe, we maintained our leadership position in European ETFs, supporting liquidity both on and off exchange. Our results were in line with the prior quarter despite reduced market activity in the European markets. The Americas saw continued NTI increases compared to the prior quarter. Supported by stable ETF volumes for our U.S. business compared to a market with reduced activity quarter-on-quarter. In Asia, overall ETF market value traded was up significantly year-on-year in H1. However, it has not translated into a material year-on-year uplift in our own ETF value traded in H1. We continue to develop and expand our Asia market presence, and as such, we were not yet able to fully capture this increase in value traded. We continue to view APAC as a growth region and continue to focus on strengthening the business. Moving to digital assets. As indicated during our Capital Markets Day, we said we would provide more information regarding our digital asset business. We also explained that EMEA crypto ETF value traded can serve as a proxy for our digital assets NTI while recognizing that our digital asset business extends beyond ETF market making. We will continue to review this as the business develops, and we'll update the market if we believe other metrics become more suitable. EMEA crypto ETF value traded for the market was down 38% in Q2 compared to Q1 and down 24% year-on-year for H1, which highlights the reduction in market activity in H1 2026. In line with movements in market activity, our EMEA crypto ETF value traded decreased by 40% quarter-on-quarter and 20% for H1 year-on-year. In line with lower market activity across crypto markets, our digital assets NTI was down 36% year-on-year for H1 and 26% quarter-on-quarter for Q2. We'll now hand over to Thomas to talk about our financials.