Germany-based online broker, flatexDEGIRO (ETR: FTK) recently published its 2021 revenue on a surge in trading volumes, retail participation, and margin funding. Well-grounded and impressive growth are the watchwords behind these excellent results.
The broker saw an impressive increase in total revenue which was up by 60% to the €418 million mark. At the end of 2021, the number of flatexDegiro customer accounts amounted to 2.06mllion, an increase of 55% compared to the 1.33 million customer accounts reported in the previous year.
In addition, the monetization with revenues per trade graduated to €5.22, from €4.83 in Q3’s. Most of its capital revenue came from a variety of sources. These were mainly rollover interests on funding, revenue from bid-ask spreads as well as the impact of hedging.
Further analysis of the filing indicates that, due to the strong operating leverage of online brokerage business, Adj. EBITDA before marketing expenses increased by €85million to €223 million. This led to an increase of margin to 53.4%.
The filing also stated that these impressive results were chiefly driven by a commitment to the highest standards of security and collateralization for any form of credit and treasury investment.
When commenting on the results, the CFO of flatexDEGIRO and CEO of DEGIRO, Muhamad C hahrour was understandably upbeat about them.
“A transformational year with the merger and integration synergies came to an end – and while many companies see a performance dip during such a year, we delivered with our teams one record after another. Our customers entrust us with financial assets of almost EUR 44 billion. On the EUR 41 billion of securities included herein, we generated 96 basis points of revenues from commissions. On the deposits of EUR 3billion, we generated 242 basis points of interest, without deviating at all from our commitment to the highest standards of security and collateralization for any form of credit and treasury investment.
“We are confident that the price and product measures as well as leveraging the synergies will provide a significant uptick in profitability. On top, potential positive interest rates should provide us with an additional tailwind to further improve ARPUs and margins.” the CEO added.
Exciting Results For FlatexDEGIRO As It Continues To Eye International Expansion
To optimize the integration of current and the growth of clients in the future, flatexDEGIRO almost doubled its marketing efforts in 2021. The total amount invested was €46million. Nevertheless, the company kept relative customer acquisition costs at a low 58euros per new customer account in 2021. These marketing investments already include expenses for the company documentary, which premiered end of January 2022, as well as for related Marketing campaigns during the first half of 2022.
Frank Niehage, CEO of flatexDEGIRO: “We have once more proven our ability to combine growth with profitability. We won a record number of over 730,000 new customer accounts in 2021. This brings us close to the growth all our major listed peers in Europe have shown combined! At the same time, we have steadily increased the monetization of trades every quarter this year, leading to a margin increase as well. This success also demonstrates the maintained high quality of our customer base throughout this tremendous phase of growth. The optimization of our pricing structure at DEGIRO, the international roll-out of our ETP partnerships with BNP Paribas and Société Générale, and the introduction of early & late trading across Europe via Tradegate; all this should lead to a very visible further improvement of our performance in 2022.”