Plus500 Ltd. (PLUS) Earnings Call Transcript & Summary

Good morning, everyone, and thank you for joining our 2023 preliminary results call. I'm David zruia, Plus500's CEO, and I'm joined today by Elad Even-Chen, our Group's CFO; and Owen Jones, our Head of Investor Relations. We are looking forward to taking your questions at the end of today's presentation. If you have a question, you can submit it via the webcast. Slide 2 shows the agenda for today. I will take you through the highlights for 2023, which was another excellent year for Plus500. Then I will hand over to Elad, who will take us through our 2023 operating review and then I will run through our technology in a bit more detail before Elad covers the financial highlights, and then I will conclude with the summary and outlook section. Turning to Slide 4. Plus500 has evolved significantly over the recent years from being a business that provided a single OTC-based product, seen here on the left-hand side of this slide, into the diversified group you see today. We now offer a wide range of products, services and instruments across our OTC, Share Dealing and Futures lines of business. Many of you will recall the strategic road map we announced 3 years ago, which was designed to diversify our business. And this slide demonstrates how we have successfully delivered against it. This strategic plan has led to our first 3 acquisitions in the U.S. and Japan. Furthermore, it has allowed us to obtain new licenses in countries as diverse as the UAE and Bahamas, and enabled us to launch a number of new technologies and products such as our new FX OTC platform for the Japanese market and the retail futures platform in the U.S. Our OTC offering covers CFDs on commodities, foreign exchange, cryptocurrencies, options and equities among other things. Our Futures offering can be split further between our B2C retail platform, known as Plus500 Futures and our B2B institutional business, which offers clearing, execution and SaaS software services to institutional clients. Finally, we also introduced a proprietary Share Dealing platform Plus500 Invest. Slide 5 shows some of the foundations of Plus500's enduring success in delivering growth and innovation for its stakeholders. The technology that we have built within the group is the key enabler of everything that we do. It is difficult to overstate its importance and just how impressive it is. It is totally proprietary, wholly owned by Plus500, supports everything we do and is managed by our talented in-house engineers and developers. Our customer-centric approach, supported by our agile and flexible business model, places our customers at the center of our operations. In recent years, we have improved our customer service significantly which includes more material customer retention investments, which I will come back to in the next few slides. The culture of Plus500 is unique and highly collaborative with clearly defined goals for all of our employees worldwide. We have highly educated teams supporting our international operations to enable various new initiatives and best-in-class customer service. Finally, financial drivers of our economic model provide customers with a highly competitive fee structure which is clearly defined by the line of business. Turning to Slide 6. We offer our services to more than 26 million registered customers, who are located in more than 60 countries. Such a sizable and established customer base reflects not only a significant store of current value but also a future opportunity as well and its successful activation, retention and monetization is something we remain focused on. Our product and operations are supported by our market-leading proprietary technology, our strong balance sheet and our global portfolio of over 13 regulatory licenses, which we plan to further increase over time. These factors all serve as key competitive advantages for Plus500. Finally, all of our achievements are only made possible by the 550 or so people at Plus500, and I'd like to thank them for their hard work during 2023, which made it such a successful year. Slide 7 shows the culmination of the strategic and financial progress we made during 2023 with a strong financial performance and the results of our focus on higher-value customers. I will leave the details of our financial performance to Elad in the coming slides, but I wanted to pull out some key highlights here. The group generated total revenue of more than $726 million in 2023 and EBITDA of more than $340 million despite less volatile markets globally during the year, equating to really healthy EBITDA margin of 47%. Our focus on attracting higher-value customers enabled by our marketing machine and retaining our existing customers has led to significant increases during the year in both the average deposit per active customer and the average revenue per user. We now also have over 233,000 active customers across our trading platforms. Slide 8 represents some of the ways in which we support our customers and enable our customer-centric approach, which I mentioned earlier. We provide customers with the range of educational and market insight materials shown here on this slide. +Insights is a proprietary big-data analytical tools designed to provide customers on our OTC trading platform with access to real-time and historical trading trends based on the group's extensive customer base. Over recent years, we have invested significantly in our premium customer service which forms a key pillar of our customer retention efforts. It is the combination of all of these aspects of Plus500's offering that will enable us to drive customer retention, monetization and activation of our more than 26 million registered customers in the future. Before I hand over to Elad, I want to touch on sustainability and ESG, which is an important topic to many investors today on Slide 9. ESG sits at the heart of our business and we are making good progress across a number of key areas. On environmental issues, we are committed to achieving a carbon negative target by 2030 and are looking to ways to reduce energy usage, particularly in our data centers. As you had heard me talk about before, we remain committed to providing the highest level of care and services to our customers, employees and our communities. In our communities, we make our contribution to charitable donations, both monetary and in-kind as well as by employee volunteering. And for our employees, we are focusing on career development opportunities and building greater gender diversity within our teams. And finally, on a governance perspective, we are proud of our highly experienced Board members led by our Chair, Professor Jacob Frenkel; former Chair of the G30. I would also like to take a moment to honor the memory of Ms. Sigalia Heifetz, one our nonexecutive directors, who sadly passed way in December. She was a highly respected and valued member of our Board, and her presence will be missed by all of us in Plus500. I will now hand over to Elad, who will take us through the operating review of 2023.

Thank you, David, and good morning, everyone. It is a pleasure to be speaking with you again after another successful year for Plus500. The operating review section will include a look at our growing business in the U.S. futures market and an overview of our operating performance in 2023. I will now cover the substantial opportunity that we see in the U.S. futures market starting on Slide 11. Plus500 entered the U.S. futures market almost 3 years ago with the acquisition of Cunningham Commodities and Cunningham Trading Systems. Since then, we have expanded our operations in this market, not only by building on the legacy of Cunningham's 40 years' history, but also by bringing a substantial amount of technological know-how and engineering expertise from Plus500. Our expansion into non-OTC products with a key pillar of our strategic road map, it was formulated around 3 years ago. Our market position in the U.S. is strong and developing quickly. Our U.S. entity is regulated by the CFTC, and is a member of the National Futures Association and the Futures Industry Association. Following the acquisitions, Plus500 has developed its position as a B2B institutional player by obtaining various clear memberships, and it is now a full clear member of the CME Group exchanges, the Minneapolis Grain Exchange and Eurex. We're also working on further expanding the number of international clear memberships to enable the growth of our B2B institutional offering. This objective will be supported by our extremely strong balance sheet, which includes cash balances of over $900 million with no debt or loans. Additionally, as part of our B2C retail U.S. offering, we're proud to have the Plus500 futures platform, which was launched a few months ago and is already gaining good traction. Turning now to Slide 12. Our proprietary technology and financial strength have enabled us to establish and grow our U.S. operations quickly. Our advanced trading platforms are supported by our market-leading technology, highly established back-end capabilities, and we offer a competitive fee structure and best-in-class back-office support. Plus500 fully holistic solution for onboarding, depositing and trading includes features that, to the best of our knowledge, are available for the first time in the U.S. futures market. We will continue to allocate substantial financial and personnel resources to the Futures line of business to maximize the significant opportunity in the U.S. over the medium and long term. On Slide 13, we show a high-level view of how the Futures market is structured and the role that Plus500 plays within it. As mentioned before, as part of the acquisitions we executed in the U.S., we've acquired an extremely scarce futures commission merchant, known as an FCM. An FCM is an entity that accepts buy and sell orders from customers and passes them on to the exchanges or clearing houses. The clearing houses such as the CME or Eurex then match each customer trade. Utilizing our proprietary technology and expertise, we aim to disrupt the futures market for both institutional and retail customers by offering a superior trading experience with enhanced trading tools and features coupled with a highly competitive commission structure and best-in-class customer service. Moving now from our Futures business to a look back at our operational performance in 2023. Starting on Slide 14. We are pleased with our operational delivery and strategic progress during 2023. Our proprietary technology drove our operations globally. We continue to invest in our product offering and we focus on deepening our engagement with our customers, including the development of our premium client segment. As a result, we delivered a strong financial performance for the year despite the quieter market backdrop. And thanks to some improved customer KPIs, such as almost 60% of our OTC revenue being derived from customers who have been trading with us for more than 3 years. Slide 15 shows the improved customer loyalty theme in more detail. Customer longevity is a key driver of the success of Plus500. This slide illustrates the success we've had since 2018 of steadily increasing the proportion of revenues being derived from long-term customers. As you can see here, shown by the blue shaded area on the pie chart, in 2023, 88% of OTC revenue was generated by customers who have been with us for more than a year. Also 29% of the OTC revenue was generated by customers who have been with us for more than 5 years, which is a tremendous statistic. This marks a new record for the business and is an important marker of our high-quality customer base and highly established trading platforms, considering this ratio stood at just 8% in 2018. The reasons for our success in retaining our customers for a longer time period are many. But I thought I'd highlight an important one on Slide 16, which is our diversified product offering. We offer our customers over 2,500 financial instruments across a wide range of underlying asset classes, which allows them to adapt their strategies and exploit trading opportunities. The result of our comprehensive offering, including the level of increasing sophistication of our customers, is reflected by the fact that nearly half of our OTC customers trade in three asset classes or more. This alongside the improvement in the average position duration and number of new open positions further highlight the success of our retention efforts and platform debt. Turning to Slide 17. This slide shows some of our KPIs by region. We have an active customer base of over 233,000. We also show on this slide the geographic split of our customers. Encouragingly, in 2023, we had an average revenue per user of more than $3,100 which continued to improve, reflecting the positive outcome of our focus on higher value customers and our superior technology offering. I will now hand back to David to elaborate further on our technology.

Thank you, Elad. Turning to Slide 19. On day 1, our technology has been our significant competitive advantage. It is fully developed in-house and, therefore, we can deliver the most innovative trading platforms for our customers wherever they happen to be. As a result, our global customer base enjoys the strength of our system architecture alongside the frontier and related technological solutions, which are unique to Plus500. Additionally, having a proprietary technology means that we are able to offer our customers unlimited access to our demo account, and it ensures that we can respond rapidly to news and market events, regulatory development and customer feedback. Over the next few slides, I will give you a taste of what makes our unique technology a key differentiator for us. On the next slide, Slide 20, you can see that we offer our customers a range of trading products, including our market-leading and long-standing OTC product, our Share Dealing platform, Plus500 Invest as well as Futures and Options and Futures. Through our OTC product portfolio, we offer over 2,500 different underlying global financial instruments across more than 60 countries and in 30 languages. Our proprietary Share Dealing platform Plus500 Invest continues to drive the expansion of our product range and geographic foot print as well as improving customer retention and further diversifying our revenue base. Our trading platforms are supported by innovative technologies. For example, +Insights, which is our proprietary big-data analytical tool is designed to provide customers on our OTC trading platform with access to real-time and historical trends using data on the group's extensive customer base. On the next slide, Slide 21. I will cover the various technological components, which we have developed and continue to develop in-house. Our technology supports all of our operations, products, marketing capabilities, customer service and is supported by a robust system architect. This means our technology can deliver a broad range of specialist services within each of these areas such as search and data analytics, marketing, payment processing and customer onboarding. In addition, the platforms have been built with an agile approach to support the needs of our customers through constant investments, innovation and by making trading user-friendly, best and reliable. Moving ahead to Slide 22. Our trading platforms have been designed to allow us to support our customers at every stage of their journey. The key components include customer acquisition to our marketing technology, registration to our established CRM system, payments to our proprietary cashier, which offers various payment methods with a localized offering as well as through the product offering, which includes risk management tools and the introduction of new products. In summary, Plus500 is focused on developing and delivering the most innovative and established technology, which provides our global customer base with a localized intuitive and secure trading experience. Turning to Slide 23. There are many benefits to the way we have developed our unique system architecture and product offering. A core part of that is how well our trading platforms are supported on mobile and tablet devices. The customer experience is seamless between mobile, tablets or web and each interaction is designed to have the same look and feel. This in turn helps to lower customer churn and provides a more consistent trading experience for customers. As a result, over 87% of OTC revenue is generated from customers trading with us on mobile or tablet devices and over 82% of OTC trades took place on mobile or tablet devices in 2023. Thank you. And I will now hand over to Elad, who will discuss our financial results before I return with the summary and outlook section.

Thank you, David. Moving on to the financial highlights on Slide 25. Overall, 2023 was an excellent year for Plus500, delivering strong strategic, financial and operational results. Our lean and flexible operating model and highly robust balance sheet continue to drive our success. And in 2023, approximately $350 million shareholder returns were announced. Shown here on the slide, the group generated total revenue of more than $726 million, EBITDA of over $340 million equating to an EBITDA margin of 47% and leading to an earning per share of $3.17. Our exceptionally strong balance sheet as of year-end included cash balances of more than $900 million with no debt or loans. I will now take you through our financials in more detail, starting on Slide 26. Here, we show the group's income statement in more detail, comparing 2023 to 2022, and also the second half of '23 versus the one in 2022. Revenue generated in 2023 stood at a level of $726 million. And this can be broken down further into trading income of $674 million and interest income of approximately $52 million. Given the extremely low levels of volatility across global financial markets in 2023, we view our revenue performance as extremely good. Also encouraging was the trend seen during the second half of '23 versus the one in 2022. Here, total revenue increased by 11% and EBITDA grew by 12%. Turning to Slide 27, we chose a more detailed breakdown of the group's cost base. Reflecting the lower levels of volatility across global financial markets in 2023, our marketing and payment processing costs decreased by around 14% which serves to illustrate the highly flexible nature of our cost base. And as mentioned on the previous slide and shown here as commission and fees, we continue to invest in our U.S. operations, which resulted in this cost increasing by 84% versus 2022. You can also see here that the majority of our cost base remains heavily weighted towards variable costs, with 70% being variable during the period. This is a key financial strength for Plus500, especially in less volatile market conditions. Turning to the balance sheet on Slide 28. The group's balance sheet is a source of huge support for all of our current and future activities, allowing us to invest responsibly where we see attractive opportunities. Since the company was founded, we have had no loans or debt on our balance sheet, and it remains that way also today. As a result of our strong financial position, we are well positioned to pursue further organic investment and targeted bolt-on acquisitions, where we identify growth opportunities and value for our stakeholders. Slide 29 shows the cash flow statement. Plus500 remains a highly cash-generative group, supported by its lean cost base and advanced technology. Since our IPO in 2013, our average operating cash conversion has been 100%. In 2023, cash generated from operations was approximately at the level of $340 million. And accordingly, we returned approximately $275 million to our shareholders by way of share buybacks and approximately $90 million by way of dividends. As a result, cash and cash equivalents at year-end stood at the level of more than $900 million. Linked to this, Slide 30 illustrates how we allocate capital across the group. The Board is constantly evaluating the group's capital position and any surplus capital that develops. Our goal is to maintain a balance between maximizing shareholder returns, making strategic organic and inorganic investment to drive future growth and developing a sustainable business over the long term. As shown on the slide, we think about our balance sheet as having two broad categories: required regulatory capital, including working capital, clearing and risk management funds and surplus capital. The quantum of the first category is at the level of approximately $550 million. While the second category, as of year-end, stood at a level of approximately $350 million. Such surplus will continue to be used to invest in future growth and to deliver enhanced returns to shareholders through share buybacks and dividends. Over time, we expect the mix of these two broad categories to evolve and reflect the mix of Plus500's businesses. However, clearly, our starting point is extremely robust. And where we refer to surplus capital, this is a true surplus, which can be used, among other things, to fund access shareholder returns. On that note, I will cover our shareholder returns policy on Slide 31. In the 10 years since the company's IPO, Plus500 has returned approximately $2.1 billion to its shareholders, including the amounts announced today, split between $1.4 billion in dividends and approximately $700 million of share buybacks. As shown here on the chart on the left, this return profile represent approximately 81% of the cumulative net profits that we have generated during that time. Our shareholder returns policy is that at least 50% of net profits will be distributed to shareholders via dividends and share buyback programs, and at least 50% of those distributions will be made by way of share buybacks. This policy will continue to apply to net profits on a half yearly basis and will continue to be based on a 23% corporate tax rate for both interim and final distributions. The Board will also consider executing special share buybacks or dividends on a half yearly basis, depending on fiscal year results as well as our investment and growth opportunities. We are pleased to announce today on an additional shareholder returns of $175 million being comprised of $100 million in share buyback programs and $75 million of total dividends. Since the commencement of Plus500 initial share buyback program in 2017 and up to December 31, 2023, the company has purchased 36.7 million ordinary shares at an average share price of GBP 13.52. Thank you for listening, and I will now hand back to David for his final remarks.

Thank you, Elad. Let's now move to the summary and outlook section, starting on Slide 33. This slide highlights the amazing track record the Plus500 has established over the last 10 years of being a public company on the London Stock Exchange. I want to take you through each statistic that you can see on this slide, but I think the one that really highlights our operating strength is the fact that over the last 10 years, we have generated net profit of approximately $2.6 billion. And of that, we have returned $2.1 billion to our shareholders, which represents approximately 81% of net profits. This statistic not only highlights the profitability of the group over the long term, but also how attractive and established our shareholder return policy is. That is the track record over the last 10 years, but what does it mean going forward? Well, Slide 34 shows our approach to diversification. Diversification brings the whole host of benefits to Plus500, some of which are mentioned here. It reduces concentration risk, which makes it easier for us to manage the risk across customers and products. For me, the key benefit of diversifying our operations is that it builds stability and brings sustainability for revenues and ultimately profits. Moving now to Slide 35. This slide shows a reminder of our strategic roadmap, which we published at our Capital Markets Day and incorporate some of the themes I was discussing on the previous slide. Looking to the future, Plus500 will continue to assess new products and markets as channels for innovation, growth and of course, diversification. Our current projects in this area are represented by our Futures business in the U.S., our newly established operation in the UAE and by our Japanese offering. Next, we'll continue to improve and expand our offering in existing markets. This will include new OTC products where applicable and constantly evaluating the latest developments within the markets we operate, such as new payment methods to ensure that our offering to customers is innovative and attractive. Lastly, a highly important initiative for the group is deepening customer engagement and improve customer retention. We have made great strides in recent years with the development of new retention technologies and their performance. So to summarize everything we have talked about today, Slide 36, the Plus500 investment case. Plus500 today is very different and much improved from the company that was listed on the London Stock Exchange more than 10 years ago. Over that time, we have established a meaningful track record of growth, innovation and attractive shareholder returns whilst improving almost all aspects within our operations, including governance. Two aspects that we will remain focused on is attracting and retaining higher-value customers, which we have done so very successfully in recent years. As I mentioned earlier, our customer retention technology is already proving to be extremely successful in this regard. We maintain an extremely strong financial position, which supports all parts of our growth plans and it enables us to provide our shareholders with attractive but also sustainable returns which is something we are committed to doing and very proud of. The Board and the executive management team have set a strategic roadmap, which clearly defines Plus500's growth plans and against which we are executing consistently. Hopefully, this provides all of our stakeholders with a clear understanding of Plus500's outlook. So, thank you for listening, and that marks the end of our presentation. We will now move on to take your questions. We have a facility to take questions over the phone or please post them on the webcast facility, and Owen Jones, our Head of Investor Relations, will put your questions to us. Thank you.

And the first question today goes to Ian White of Autonomous Research.

Few for me, please. Just first of all, on the B2B offering, can you just talk us through how the sort of scalability of revenue work in that business? Is it more of a subscription-based revenue model or solely surcharge per trade or revenue per scale with volumes, please? You can just describe the dynamics around that, that would be helpful. Secondly, sort of how many memberships or what sort of membership profile is needed for the FCM business to be kind of mature or capable at cracking all of the addressable market, please. You've talked about how adding Eurex, for example, sort of gives you more sort of so global relevance, but kind of how many more might be needed before you can access all of the relevant market, please? And then just finally, within the sort of 20,000 or so new clients on-boarded during 4Q '23, how many were in the U.S. and Japan, respectively, please?

Hi, and good morning. It's Elad. So as for kind of -- I'll take one by one. So as for the B2B operation, very much the revenue is being generated by commission, from the clearing service perspective. And of course, under the retail element as well, it's associated with the commission for the execution and for the clearing. Can confirm that under the U.S. operation, we don't have any subscription model, at least as of today. Potentially, we may change it. But very much today, we're kind of the only one within the industry not to have a subscription model. As for the operation also in the U.S. or more specifically for the Futures and the membership, indeed, we extended our footprint following the acquisitions of Cunningham and CTS by bringing all together all the 11 memberships and the Minneapolis Grain Exchange and Eurex as well. We're working to extend it as well if it's in Europe, in other territories across the globe. Can confirm that already now, it's a very established proposition. Needless to say that also where we are in NCM, like clearing member, we can very much also clear those transactions. But the benefit is, of course, where we are the GCM, the full clearing member, and accordingly, the level of profitability and the level of revenues to be increased accordingly as well. Aside of the fact that you are a one-stop shop, which brings also added value to your clients. So we are working strategically to expand in other territories, other continent and we do see the upper level of the revenue recognition as time will go by, by that segment of the clearing. As for the KPIs themselves, Unfortunately, as we haven't put together a specific split at least for now, we do aim to do so for the end of the year and most likely of 2024, then we will provide that level of visibility. I can say that already we're gaining a side of the B2B level of very good and established traction of customers. Also from the Retail side, we're bringing a significant amount of customers that only following the launch of the PFP, the Plus500 Futures platform in last September.

We currently have no audio questions. I will now hand over to Owen for any webcast questions.

Yes. Good morning. Thank you. Hi, everyone. We have a few questions that have come in via the webcast facility. The first one, David and Elad is with regards to our strategic roadmap that we published with our Capital Markets Day in 2022. The question is, can we provide an update on our progress in this regard and whether or not we still view the incremental revenue as achievable.

Thank you, Owen. So absolutely, we believe that it is achievable and it's more than achievable. We are progressing well with this. we didn't elaborate more than what we elaborated. I think that the announcement from today includes many updates related to this. And overall, I can say that it's progressing well.

Okay. Thank you, David. The next one is with respect to our treasury shares, given the buyback that we've done over the last few years, we now hold a reasonable amount of shares in treasury. The question is what plans do we have for these shares?

Sure. So as the treasury shares are being considered as canceled by definition. It's just a bureaucratical kind of process to cancel them also according to the Israeli law. So we do treat them as canceled. And if you'd like to use them in any case, you need to reissue them. So it's not something that is available for you to use, you need to reissue them. And of course, if and as may be applicable in future periods, the company will come across with any updates to the market.

Great. Thanks, Elad. Our next question is about crypto -- cryptocurrencies. What percentage of our revenues or activities come from cryptocurrencies? And do we have a specific strategy for this asset class over the medium term?

Sure. So as for the crypto, I believe it's a very important point to understand the mechanics or the business model of Plus. As opposed to other peer group, Plus is very much one to be diversified. And one also to demonstrate, and we showed it also today on the deck, that 47% of the level of clients that have generated or they are trading on more than 3 asset classes. It's something that provide us stability. It's something that provide us also protective measures. If, for example, there is lower level of liquidity or volatility within other asset classes, you've seen it with other peer group that, that wasn't the case. And very much for Plus, the benefit is to be very diversified. Now at the current stage and also as for 2023, we could have seen a level of crypto kind of interest, nothing dramatic. It's one single digit. We don't break it down to specific asset classes, but it's nothing significant, I would say, very much. And the customers have also came in, in for crypto, they are staying for other asset classes, and this is the benefit. I believe we also show to the market, within the capital markets presentation, the level of absolute amount of cumulative deposits per year. And within the year of 2017, the market could have seen that we brought tremendous amount of level of deposits since then, and those were the crypto customers allegedly that the market initially thought to be less relevant. So very much, we know how to bring high-value customers, and those customers are sticky customers. And at the end of the day, this is also the benefit of Plus.

Great. Thank you, Elad. We've had more than one question on the webcast about our balance sheet and how we expect our balance sheet to evolve over time, particularly as the clearing business grows. I think we did comment on this in the presentation. But Elad,just in case you had any further comments that you wanted to make with regards to the balance sheet going forward.

No. I believe, as you've just said, we were very much specific and transparent on the guidance that what we, as a Board, what we, as a company, would like to maintain under the first bucket of the regulatory and liquidity balances that we believe should be within the balance sheet. And the surplus is the surplus. Now of course, as time may go by and the clearing service or the clearing operation may go in a more scaled manner, of course, the level of profits and revenues should also be attributed to that. And accordingly, the reserves -- the retainings may be higher as well. So we feel very comfortable with the current numbers. And you can see that we haven't also upgraded them or changed them along the last year, and we'll continue, of course, to update the market as and if may be applicable.

Great. Thanks, Elad. I will hand back to Nadia. I think we have one further question from the dial-in facility.

We have a question by phone lines from Edward James of Cantor Fitzgerald.

If I could ask three, please. So just firstly, on the U.S. B2C and B2B business. Could you -- is there any sort of updates or KPIs you could point to in terms of the momentum there. And particularly with the B2B business, you previously mentioned that, that has grown at roughly 4x since the acquisition. Is there any update on that? And how large or what proportion of sales do you think that should get to this year? Second is just on ARPU and average deposits. Clearly, that's improving, and that's positive. Am I right in assuming that that's been mainly driven by the U.S., but does that also suggest that there remains significant room for further uplift in your existing established markets like the EEA. And then finally, guidance is also unchanged, which I guess is no surprise how early in the year it is. But given the momentum in the second half of the year and Q4, the positive remarks across the business, is there any further color you can provide just on the confidence going into 2024 and how the year has started and how you think it will shape up.

Yes. Thank you. It's David here. So with regards to the U.S. KPIs, so obviously, we didn't share more with the market. That said, I can say that with the B2B, we have onboarded some of the largest introducing brokers in the U.S. so far. We are in negotiations with many and this is a key pillar with the growth of the B2B business. With B2C, I can elaborate that we have -- we are onboarding a few hundreds of new depositors every month now, which started to contribute revenue, and we see the revenue growing month by month. It's still the early stages of the business there. But as we move on, we will ramp it up more quickly.

Moving on to the other two questions. So as for the ARPU level and the deposit, very much, you could see that both came across with a record level of numbers. And actually, it was driven mainly by the OTC operation rather than only kind of the U.S. operation. So very much the OTC operation is alive, is kicking. I would also refer you to Slide 15 within the deck that kind of provides you the understanding of the longevity of those customers. Nowadays, 29% of the revenues of the year of '23 was generated by customers that were with us for more than 5 years. This is literally a very important KPI to better understand the mechanics, the characteristics of current client base of Plus500 to where it was only 5 years ago or 6 years ago. In 2018, it was only 8%. So the journey we've done and the current level of customers that we are bringing all together, it's at a different level. So we are very proud of it and very much those were the one to move the needle. What was -- sorry for that, the third question?

Third question, just on, no change in guidance despite strong momentum. Just any color on the shape of 2024, how the year starts?

So we can definitely say that we feel -- and as we said, we feel very comfortable and very supported by the current process and current outcomes of the revenues and other KPIs. And of course, on the back of the latest levels of upgrades of certain and different analysts. We, as a Board, we commented that we're in-line and very much, as may be applicable, will continue with the year. And if may be applicable, we'll comment accordingly.

We have no further questions, and I'll hand back to David for any closing comments.

So thank you, everyone, for your questions. To summarize, I believe Plus500 delivered another strong performance during 2023, supported by our highly robust financial position and continuing investment in growth and innovation, we remain well positioned for the future. We would like to thank you all once again for taking the time to be with us today, and goodbye.