DGAP-News

flatexDEGIRO with brilliant start into a new era of online brokerage in Europe - Seite 4

Average trading patterns tend to show a strong correlation with the volatility of global stock markets. On an annualized basis, average trades (pro forma) per customer in the first nine-months 2020 correspond to 72.0 for the full year, significantly above the comparable pro forma number of 37.0 for full-year 2019.

Revenues

(in EUR)	9M 2020	9M 2019	Change
Revenues	164.8 m	98.8 m	+66.9%

Reported revenues increased in the first nine-months of 2020 by EUR 66.1 million or 66.9 percent to EUR 164.8 million (9M 2019: EUR 98.8 million). The significant increase was driven by strong client growth, above average trading activity per client and to a lesser extent on the first time consolidation of DEGIRO from 1 August 2020 onwards.

Almost all revenues and expenses are generated in euros. Changes in currency exchange rates thus did not have a significant impact on the revenues and earnings situation.

Other operational and financial performance

As a result of the acquisition of DEGIRO, management expects to leverage significant synergies stemming from the harmonization of both platforms, the internalization of services currently provided by third parties, the reduction of costs and benefits resulting from the increased scale and geographical reach of the business.

"We expect overall EBITDA synergies to amount to more than EUR 30 million per year. It is foreseen that all measures to achieve these synergies will be fully implemented by the end of the first half 2021, allowing flatexDEGIRO to fully benefit from this annual run-rate of EBITDA improvement from the second half of 2021 onwards," say Muhamad Chahrour, CFO of flatexDEGIRO AG.

For a number of the synergy measures, implementation has already started shortly after closing of the DEGIRO acquisition in July 2020, such as the majority of measures related to utilizing the Group's infrastructure and bank license for all European business ("One bank"). As an example, DEGIRO customers in all major countries have already been offered to open EUR cash accounts at German flatex Bank AG and thereby moving away from the current money market fund solution. This will provide customers with a better protection due to the statutory deposit insurance of up to EUR 100 thousand (instead of just EUR 20 thousand under the previously applying securities protection scheme) and faster access to their cash deposits. For flatexDEGIRO, it means an internalization of business previously done with third parties in relation to the offered money market fund solution. It will also allow the Company to utilize these additional cash deposits, e.g. for handing out fully collateralized margin loans to its customers, which, in the case of the solution currently used by DEGIRO, will again result in significant cost savings. Due to the timely progression of these measures, management is confident to achieve the operational improvement related to "One bank" already fully at the beginning of 2021.