Plus500 Ltd. Annual Report 2021

Enabling trusted

and intuitive

access to financial

opportunities

WELCOME

Plus500 delivered an excellent operational

and financial performance in 2021 and we

made significant progress with our strategic

roadmap to develop our position as a leading

global multi-asset fintech group. Given the

strong positive momentum delivered by the

Group in recent years, the Board continues to

expect that Plus500 will deliver sustainable

growth over the medium to long-term.

David Zruia, Chief Executive Officer

Read more in the CEO’s Q&A on pages 7 – 11

2021 headlines

An outstanding year of positive operational and financial momentum:

–

Excellent performance across all key metrics, including consistently strong

levels of Customer Income

;

–

Significant milestone of over 22 million registered customers achieved on

Plus500’s platforms;

– Major opportunity to leverage this latent customer base, through new retention,

activation and monetisation activities and technology-based initiatives, including

new premium account offering;

–

Continued high customer engagement, driven by Plus500’s market-leading

technology-based offering and brand recognition; and

–

Robust financial position further strengthened, with substantial improvement

in cash balance.

Excellent progress in developing Plus500’s strategic position as a global

multi-asset fintech group:

–

Significant progress made, in line with strategic plans to broaden Plus500’s

product range from its single product focus, helping to diversify the Group’s

revenue streams and geographic footprint;

– The Group’s first ever acquisitions made to establish Plus500’s position in the

high growth markets of futures and options on futures, to be developed through

continued investment in technology integration and a multi-dimensional market-

ing approach;

–

Successful launch of a proprietary share dealing platform, ‘Plus500 Invest’, with

further roll-out in FY 2022; and

–

On-going organic investments in marketing technologies, technology innovation

and product development, supported by the established R&D centres in Israel.

Further strategic developments achieved in Q1 2022:

–

New regulatory licence granted in Estonia, which will further support the Group’s

business across European markets in its core product offering, complementing

the Group’s existing portfolio of regulatory licences globally; and

–

Completed acquisition of a Type 1 regulated firm in Japan, expanding the

Group’s geographic footprint and representing a major growth opportunity

within the substantial retail trading market in Japan.

Further improvements on governance, regulation, social responsibility

and risk management matters:

– New Independent Non-Executive Directors appointed, including Prof. Jacob A.

Frenkel as Chair, expanding the range of experience of the Board of Directors of

the Company (“the Board”) and further diversifying its composition, as well as

enabling greater access to new growth markets, in particular the US;

– Consistent focus on sustainability initiatives, including donations to local com-

munity projects and on-going emphasis on customer care and protection; and

– Targeted hedging strategy initiated to minimise market risk.

Attractive returns continue to be delivered to shareholders, including

dividends and share buybacks to the amount of $200.2m related to FY 2021:

–

Dividend payments in respect of FY 2021 of $120.0m ($1.1916 per share),

comprising:

– Final dividend of $37.8m ($0.3777 per share);

– Special dividend of $22.2m ($0.2218 per share); and

– Interim dividend of $60.0m ($0.5921 per share).

–

Share buyback programmes in respect of FY 2021 of $80.2m, including $67.6m

in H2 2021, comprising:

– New programme to purchase up to $55.0m of the Company’s shares, which

includes a final buyback of $25.2m and a special buyback of $29.8m; and

– A programme of $12.6m was announced in August 2021 in respect of H1

2021, with an additional programme of $12.6m, announced in October

2021, as part of the FY 2021 final programme.

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.

Strategic report

Governance

Financial Statements

Further information

1Plus500 Ltd. 2021 Annual Report

Contents

Group at a Glance 2

Chair’s Statement 4

Q&A with the Chief Executive Officer 7

Our Technology 14

Our Purpose, Strategy and Key Differentiators 20

Our Strategy in Action 22

Our Business Model 24

Key Performance Indicators 26

Key Stakeholder Relationships 28

Our ESG (Environmental, Social, Governance) Approach 30

Financial and Business Review 38

Group Tax Policy 40

Risk Management Framework 41

Going Concern and Viability Statement 46

Governance at a Glance 48

Chair's Introduction to Governance 50

UK Corporate Governance Code Compliance Statement 51

Board of Directors 52

Governance Report 54

Shareholder Engagement 59

Report of the Nomination Committee 60

Report of the Audit Committee 64

Report of the Regulatory & Risk Committee 69

Report of the ESG Committee 71

Report of the Remuneration Committee 74

Directors' Remuneration Report 81

Directors' Report 89

Corporate Law 91

Directors' Responsibility Statement 92

Independent Report of the Auditors 94

Consolidated Statement of Comprehensive Income 98

Consolidated Statement of Financial Position 99

Consolidated Statement of Changes in Equity 100

Consolidated Statement of Cash Flows 101

Notes to the Consolidated Financial Statements 102

Advisors Inside back cover

Revenue

$718.7m

New Customers

196,336

EBITDA

$387.1m

Active Customers

407,374

EBITDA Margin %

54%

ARPU

$1,764

Cash balance at year end

$749.5m

AUAC

$877

2021 Financial highlights

2021 Operational highlights

1 Customer Income – Revenue from CFD Customer Income (customer

spreads and overnight charges) and Non-CFD Customer Income

(commissions from the Group’s futures and options on futures operation

and from ‘Plus500 Invest’, the Group’s share dealing platform)

2 EBITDA – Earnings before interest, taxes, depreciation and amortisation

3 New Customers – Customers depositing for the first time

4 Active Customers – Customers who made at least one real money trade

during the period

5 ARPU – Average Revenue Per User

6 AUAC – Average User Acquisition Cost

2 Plus500 Ltd. 2021 Annual Report

Group at a Glance

A GLOBAL MULTI-ASSET

FINTECH GROUP

22+ million

Registered customers on Plus500 platforms

globally since inception

Read more on pages 20 – 21

Our purpose

Enabling trusted and intuitive access to financial

opportunities.

Across financial instruments

Through broad product range.

Across countries

Through global scale with localised services.

Across devices

Through best-in-class technology.

Plus500 is a global multi-asset fin-

tech group operating proprietary

technology-based trading platforms.

Plus500 offers customers a range of

trading products, including Contracts

for Difference (“CFDs”) and share

dealing, as well as futures and op-

tions on futures. Plus500 has a pre-

mium listing on the Main Market of

the London Stock Exchange (symbol:

PLUS) and is a constituent of the

FTSE 250 index.

Our values

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 ESG initiatives

to deliver tangible value for our stakeholders.

Read more in our ESG report on pages 30 – 37

Our strategy

Strengthening our position as a multi-asset fintech group

over time by expanding our core product offering in new

and existing markets, launching new trading and financial

products and deepening our engagement with customers.

Read more about our strategy on pages 22 – 23

50+

Countries where

Plus500 trading

platforms are

available

450+

Employees at

Plus500 globally

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

London

Chicago

Victoria

Sydney

Singapore

Tallinn

Limassol

Tel-Aviv

Haifa

(HQ)

Sofia

Global operations

conducted from our

localoffices

worldwide

Plus500 licences

The Group retains operating licences and is regulated in the United Kingdom, Australia, Cyprus, Israel, New Zealand, South Africa,

Singapore, the Seychelles, the United States, Estonia and Japan¹

1. Estonia and Japan obtained during Q1 2022.

2. CAGR – Compound Annual Growth Rate.

3. ROI – Return on Investment.

Our competitive advantages and differentiators

Our global position

Tokyo

Powers our products,

operations and marketing

+ Proprietary, wholly owned,

managed and operated by

Plus500

+ Drives our customer-centric

approach

+ Significant investment in R&D

to drive continued innovation

+ Supports our continued

compliance with regulatory

standards

Strong financial performance

since IPO in 2013

+ 25.7% revenue CAGR

+ Flexible cost base with

average annual EBITDA

margin of c.57%

+ Strong balance sheet, highly

cash generative and debt-free

+ Approximately $1.4 billion

returned to shareholders in

dividends and share

buybacks

Technological expertise

embedded across the business

+ Highly skilled leadership team

with long-standing experience

in technology and financial

services

+ 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 channels

+ Proven business model

serving customers globally

for over a decade

+ Strong brand and reputation

+ Continued focus on customer

care and protection

+ Drives attractive ROI

Our technology Our track record

Our agile

business model

Our leadership,

people and culture

$718.7m

$872.5m

$354.5m

2019

2021

2020

$200.2m

$278.3m

$151.7m

2019

2020

2021

4 Plus500 Ltd. 2021 Annual Report

In my first statement as Chair of the Board of Directors of the Company

(the “Board”), I would like to express my sincerest gratitude to our

shareholders for approving my appointment at the Company’s AGM

on 4 May 2021.

It is a huge honour to be Chair of the Board of Plus500 at such an

exciting time for the Group. Led by our talented management team,

supported by our highly skilled people worldwide and driven by our

market-leading proprietary technology, Plus500 is very well placed to

access a range of growth opportunities to further diversify our business

going forward.

Having been Chair for almost a year, it is clear that we also have a

strong and diverse Board, which functions very effectively and col-

laboratively. I look forward to continuing to lead our Board, as we ensure

the business delivers further value for our stakeholders in the future.

An outstanding performance in FY 2021, with significant strategic

progress made

FY 2021 was another year of major operational, financial and strategic

success for Plus500, building on our long track record of performance

since the Company’s IPO in 2013. Since the IPO year, Plus500 has

delivered revenue CAGR

of 25.7%, resilient EBITDA margins averaging

57% and generated cash from operations of approximately $2.4 billion.

The Group delivered continued operational momentum in FY 2021,

which translated into another outstanding financial performance across

all metrics, well ahead of pre-pandemic levels. Total revenue for the

year was $718.7m, which drove EBITDA to the level of $387.1m. The

Group’s balance sheet position remained very robust, with a cash bal-

ance at the end of FY 2021 of $749.5m.

FY 2021 was a ground-breaking year for Plus500 from a strategic

perspective, with excellent progress made in developing our position

as a global multi-asset fintech group. We made significant headway in

diversifying our product portfolio and geographic footprint during the

year, with the Group making its first ever acquisitions.

Revenue

$718.7m

Total shareholder returns of approx.

$1.4bn

delivered since IPO, in dividends and share buybacks

I look forward to

continuing to lead our

Board, as we ensure

Plus500 delivers further

value for our stake-

holders in the future.

Prof. Jacob A. Frenkel, Chair

Read more in our Financial and Business Review on pages 38 – 40

DELIVERING

STAKEHOLDER VALUE

Chair’s Statement

1. CAGR – Compound Annual Growth Rate.

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

These acquisitions immediately expanded our geographic footprint

and product offering in the significantly growing, but under-penetrated,

US retail trading market in futures and options on futures. In addition,

our product range was further expanded during the year with the launch

of a new share dealing platform, ‘Plus500 Invest’, which was developed

in-house. More details on this excellent strategic progress are included

in the CEO Q&A on the following pages.

In addition, our portfolio of operating licences was further expanded

with the addition of a new licence in Estonia, granted by the Estonian

Financial Supervision Authority in February 2022. This new licence will

further support our business across European markets in our core

product offering and is supported by the establishment of a new local

regulated subsidiary. In March 2022, following a lengthy assessment

of the market opportunity in Japan, the Company completed an acqui-

sition of a local firm regulated by Japan’s Financial Services Agency.

This represents a major growth opportunity for Plus500, through an

immediate presence in the substantial retail trading market in Japan.

Our portfolio of licences is an increasingly valuable asset for the Group,

given its scarcity and the growing complexity of obtaining new licences.

As a result of our strategic progress and operational performance in

FY 2021, supported by a clear and rigorous plan to further invest in the

future growth of our business, the Group has entered FY 2022 in an

excellent position.

The growth outlook for Plus500

The Board continues to expect that Plus500 will deliver sustainable

growth from all of the Group’s product offerings over the medium term.

This expectation is supported by the Group’s significant operational

and financial momentum over recent years, which validates our clear

and comprehensive strategic roadmap. Future growth will be enabled

by on-going investment in developing our position as a global multi-

asset fintech group, in particular through further organic investments

in technology, marketing and people, by actively targeting additional

acquisitions and activating potential strategic partnerships.

The positive momentum achieved by Plus500 in recent years has

continued to date in FY 2022, driven by the on-going underlying strength

of Customer Income. Consequently, the Board remains confident about

Plus500’s prospects for FY 2022.

Continued focus on Corporate Governance and engagement with

the investment community

The Board remains focused on its key priorities in Corporate Govern-

ance, supported by our on-going engagement with shareholders and

potential investors, analysts and shareholder advisory bodies.

There were a number of Independent Non-Executive Director appoint-

ments to the Board during the year, as well as my own appointment

as Chair, namely Ms. Tami Gottlieb and Ms. Sigalia Heifetz, both of

whom have already added great value to the Board. Also, in Q1 2022,

Prof. Varda Liberman was appointed as an additional Independent

Non-Executive Director.

These appointments have broadened the range of the Board’s experi-

ence and expertise and further diversified its gender composition,

ensuring that the representation of women on the Board is ahead of

the 33% target set by the Hampton-Alexander Review on gender equal-

ity in leadership positions.

Our investment case

Our purpose is supported by

a robust investment case

Long-standing, high value and di-

verse customer base

State-of-the-art technological

platforms

Supportive market environment

with long-term structural growth

Robust financial profile with long

term track record of growth

Market-leading core product of-

fering with potential expansion

into new regions and products

Strong global marketing technol-

ogy capabilities

1. CAGR – Compound Annual Growth Rate.

6 Plus500 Ltd. 2021 Annual Report

Furthermore, all of our Board members have built long-term, global

relationship networks, which will potentially be leveraged by Plus500, to

help gain greater access to new growth markets, in particular the US.

We continue to place major focus on engaging with key stakeholders

within the global investment community. I met with our major sharehold-

ers during the year, while our Executive Management maintained regular

dialogue with shareholders and potential investors throughout FY 2021,

to ensure investors were kept up-to-date with our strategic progress and

operational performance. In addition, these meetings were used to gather

investors’ helpful perspectives and insights on our business, on our

sector and on the overall outlook for global capital markets.

We will continue to engage with the investment community going

forward, by further enhancing and expanding the range, reach and

focus of our investor contact programme, through additional com-

munication channels and platforms.

Ensuring an optimised organisational culture remains crucial

Having met many of our people within the business since joining the

Board, I have been extremely impressed by their energy, dedication,

expertise and skill sets. This is particularly notable, given the challenges

that have been faced by our people in their daily lives and working envi-

ronment, as a result of the COVID-19 pandemic over the last two years.

Our head office is 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 developments.

Plus500 has fostered an entrepreneurial and high-performance organ-

isational culture, designed to drive employee attraction and retention,

that reflects Israel’s technology-based environment. We aim to continue

to replicate this cultural mindset in each of our global operating sub-

sidiaries, as we have done historically.

The Board continues to monitor and review the Group’s culture, values

and performance primarily through regular discussions with our Exec-

utive Directors, senior management and their teams. This engagement

is driven by Steve Baldwin, an 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 concerns directly to the Board, to help inform

the Board’s approach to supporting on-going improvements in our

organisational culture and values.

On that note, I would like to take this opportunity, on behalf of the Board,

to thank all of our people for their continued commitment and focus,

as we continue to do all we can to maintain their personal development,

health and well-being.

Regulatory compliance remains a cornerstone of the Group’s

approach

The Group maintains a highly robust, customer-centric approach to

compliance, supported by our expertise in the applicable global regulatory

standards and our long-standing relationships with the regulators in the

markets and industries in which we operate. We support measures

introduced by regulators, with a view to ensuring better care and protec-

tion for all customers.

Global regulatory alignment has continued in the industries in which

we operate, with recent regulatory changes being mirrored across

various territories. The most recent regulatory changes in the CFD

industry were implemented by the Australian Securities & Investment

Commission in March 2021. The Group is supportive of, and compliant

with, these changes, which are expected to enhance the CFD trading

landscape and provide additional protection for customers. The impact

of these regulatory changes on Plus500’s operational and financial

performance is in line with our initial expectations. With an established

global regulatory network, managed by our regulated subsidiaries and

overseen centrally, Plus500 remains well positioned for potential future

changes to the regulatory environment across the markets in which

we operate.

The Board continues to ensure shareholders are rewarded with

an appropriate level of returns

The Board continues to assess the availability of excess capital going

forward, to ensure that an optimal balance is maintained between

shareholder returns, investments in future growth and in driving busi-

ness continuity, as we ensure that appropriate levels of available

capital are maintained for required regulatory purposes and other

factors. In current market conditions, and given the Group’s strategic

position and growth prospects, the Board believes that the appropriate

level of required capital is approximately $450m.

For FY 2021, total returns to shareholders amounted to $200.2m. This

includes dividend payments of $120.0m, including an interim dividend

of $60.0m, a final dividend of $37.8m and a special dividend of $22.2m.

Total returns for the year also include share buyback programmes of

$80.2m, including two programmes of $12.6m each announced in

August and October 2021, as well as a new programme to purchase

up to $55.0m of the Company’s shares. The new programme includes

a final buyback of $25.2m and a special buyback programme of $29.8m.

The special dividend and special buyback programme are directly

related to the benefits of the change in tax rate following the Company’s

accreditation as a Preferred Technological Enterprise by the Israeli Tax

Authority in FY 2020. Earlier in FY 2022, this accreditation was suc-

cessfully extended up to and including FY 2026, which is a significant

achievement, bringing additional value for the Group and our sharehold-

ers in the years to come.

Overall, since our IPO, and including shareholder returns related to

FY2021, the Company has returned approximately $1.4 billion to

shareholders.

Prof. Jacob A. Frenkel

Chair of the Board

22 March 2022

Chair’s Statement continued

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

As with previous years, our performance in FY 2021 was driven

by two major elements – our technology and our people.

Every element of our technology is fully and seamlessly integrated

and inter-connected across our operations, systems architecture,

product and marketing capabilities. This enables Plus500 to respond

with agility to customer requirements, fast-emerging market develop-

ments and regulatory changes. It has taken us many years to develop

this technology, with constant upgrades, continued innovation and

the introduction of a range of new features, new services and new

capabilities over the last decade. In FY 2021, we continued to invest

in our technology infrastructure, to drive growth and scalability. As

a result, Plus500 is now a highly developed business, with a long

track record of innovation, and a market-leading technological capa-

bility.

Our technology is operated by highly skilled engineers and develop-

ers. Across our organisation, in areas such as marketing, operations

and R&D, we have a base of talented people, which was further

strengthened in FY 2021 through a major recruitment drive in a

number of departments.

We aim to continue to develop our people and harness their talent

by maintaining and further developing a working environment which

empowers on-going improvements in employee development, through

training, learning and career progression. This culture has helped to

drive employee attraction and retention and has ultimately led to

enhancements in the capability of the Group’s technology. We are

also dedicated to the well-being of our people and we aim to con-

tinue to provide them with optimal working conditions to support

a healthy, safe and balanced working environment, particularly

throughout the challenging period of the COVID-19 pandemic.

FY 2021 was a very busy and positive year for everyone at

Plus500. The hard work and dedication of our people during the

year ensured that we delivered on all fronts – operationally, finan-

cially and strategically.

There were a number of highlights for the Group during the year.

Firstly, we executed the Group’s first ever acquisitions, which con-

tributed to the diversification and extension of our offering into the

futures and options on futures market.

Another highlight was the launch of our new proprietary share

dealing platform, ‘Plus500 Invest’, which was fully built in-house.

We also developed and introduced a range of new customer reten-

tion, activation and monetisation technologies across our platforms,

to ensure continued engagement with our customers over time.

We made strong progress in further developing our approach in

the areas of Environment, Social and Governance (“ESG”), with a

view to increasing the Group’s resilience over the long term. This

has been supported by more detailed disclosure on ESG, as outlined

on pages 30 – 37 in this report, which we hope provides investors

with a clear understanding of our key priorities in these areas.

Finally, of course, a major highlight was our overall operational and

financial performance, which was consistently strong throughout

the year.

Can you sum up your key highlights of FY 2021?

What were the fundamental drivers of this

performance?

TECHNOLOGY DRIVEN

PERFORMANCE

Q&A with the Chief Executive Officer

Our performance in

2021 was primarily

driven by our

technology and

our people.

David Zruia, Chief Executive Officer

8 Plus500 Ltd. 2021 Annual Report

Q&A with the Chief Executive Officer continued

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 is being driven by our continued progress as a global multi-

asset fintech group, supported by organic investments and targeted

acquisitions. In the future, we may also look for potential partner-

ships in order to achieve our strategic ambitions.

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 reten-

tion. This will be achieved by successfully delivering against our

strategic roadmap of:

– Expanding our core product offering in new and existing markets;

– Launching new trading and financial products; and

– Deepening engagement with customers.

Can you remind us of Plus500’s purpose

and strategy?

Our core product, CFDs, remains an attractive offering for cus-

tomers around the world, enabling trading on leverage and access

to market liquidity, while being protected by high levels of customer-

focused regulation. Our product offering is fully aligned with regu-

latory requirements in the countries in which we operate, ensuring

customer protection through elements like our free unlimited demo

account and negative balance protection. With our offering, cus-

tomers have the comfort that they are trading on attractive com-

mercial terms and they can access everything they need through

one multi-channel solution. With a long track record in innovating

our CFD platform, we offer customers a choice of over 2,500 finan-

cial instruments across a wide range of asset classes, countries

and languages. We continued to add more instruments, features

and analysis tools to our core product offering during FY 2021, to

help further deepen customer engagement. Future growth of our

core product offering will be driven by further expansion of our

reach and footprint in new markets, continued enhancement of

our technological capabilities and the launch of new instruments

to enhance our offering.

With substantial untapped customer demand potentially available

outside of our current geographic footprint, we will continue to

target new potential markets to launch our core product offering,

through obtaining operating licences in those markets, either

organically or via acquisitions. As evidence of this, in February

2022, we obtained a new licence in Estonia to further support our

business across Europe in our core product offering. In March

2022, we made our first acquisition in Japan, which also represents

our first footprint in this new market and will allow us to offer our

services locally. I am very excited about the opportunities in the

substantial Japanese market and I am confident that we will be

able to maximise those opportunities over the medium to long-term.

Current target markets include various countries in the Americas,

Asia and the Middle East, with new regulated markets in which we

do not currently operate, and where there is huge growth potential,

being a particular focus.

How are you planning to expand your core product

offering and what are your future plans on this front?

Expanding

We’re expanding our core product

offering in new and existing markets

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

I was particularly pleased with our progress in this area in FY

2021, as it enabled us to strengthen our position as a multi-asset

fintech group. There were two major milestones for Plus500 in this

area.

Firstly, we executed our first ever acquisitions – Cunningham

Commodities LLC., a regulated Futures Commission Merchant,

and Cunningham Trading Systems LLC., a technology trading

platform provider, which established our position in the futures and

options on futures market.

Through these transactions, we immediately expanded our geo-

graphic footprint and product offering in the significantly growing,

but under-penetrated, retail trading market in futures and options

on futures.

In line with our strategic roadmap, the integration of these acquisi-

tions is well underway, with a number of R&D recruitments during

FY 2021 specifically focused on leveraging Plus500’s best-in-class

technology to optimise the acquired businesses. Ultimately, this

will help to deliver market access to the millions of potential cus-

tomers looking for new trading opportunities. We believe that this

represents a major strategic opportunity for Plus500, as we look

to expand in this significant market, which is being driven by sub-

stantial management focus and continued investment in technol-

ogy and people. There were record derivatives volumes traded in

2021 and crypto currency continued to move into the mainstream

within the industry, with, for example, the launch of Ether, Micro-

Ether and Micro-Bitcoin Futures by the CME in 2021.

Supported by a clear regulatory framework, Plus500 has a real

opportunity to be a technology disruptor in this market, where the

competitive environment is fragmented, the utilisation of technol-

ogy is relatively limited and the range of asset classes for custom-

ers to access is becoming increasingly broad and accessible.

The second major milestone for us on new products during the

year was the successful launch of our new share dealing platform,

‘Plus500 Invest’, in over 15 countries across Europe. At the start

of FY 2022, it is available through a Web app and a mobile app on

both Android and iOS. The platform, which was developed in-house

by Plus500, includes a wide range of around 1,500 financial instru-

ments comprising of the world’s most popular equities, with a high

quality, user-friendly and intuitive customer experience.

‘Plus500 Invest’ will be rolled out in additional target markets in

FY2022, with new equities and ETFs to be added to the product

offering, helping to drive our expanded product range and geographic

footprint.

Can you talk about progress on, and future

plans for, how you are launching new trading

and financial products?

We’ve expanded our

geographic footprint and

product offering in the

significantly growing,

but under-penetrated,

US retail trading market

in futures and options

on futures.

10 Plus500 Ltd. 2021 Annual Report

1 Customer Churn: [(Active Customers (T) + New Customers (T+1)) – Active Customers (T+1)]/ Active Customers (T).

During FY 2021, we laid out our plans to incrementally invest

approximately $50m in our R&D capability between FY 2021 and

FY 2023. During FY 2021, we initiated a major re-organisation of

our R&D department, including the establishment of a new R&D

centre in Tel-Aviv, and this investment will support the on-going

recruitment of talented engineers, programmers, web designers

and product managers at our R&D centres in Israel. In addition,

this investment will continue, alongside our investment in market-

ing technologies, to support innovation and product development,

as well as driving major customer-focused initiatives around reten-

tion, monetisation and activation.

During FY 2021, we have placed an increased emphasis and invest-

ment on developing new retention and monetisation technologies.

These include tailored and multi-channel customer notification

strategies to drive retention, conversion and build trust with cus-

tomers.

We have also launched a new premium account for customers,

which offers benefits such as professional trading webinars, weekly

analysis emails and additional tools. We also make sure customers

have sight of important news and market events, which can present

them with compelling trading opportunities.

With a base of over 22 million registered customers, to which such

initiatives are being targeted, we have a significant opportunity to

utilise this investment. This will be achieved by re-activating the

users who are not current Active Customers, through monetisation

initiatives, as well as targeting users who have never been Active

Customers.

I am really proud of our operational performance in FY 2021,

particularly on the back of a record year in FY 2020, which was

driven by our investment in marketing technologies to drive cus-

tomer engagement.

Our strong performance during the year was well ahead of pre-

pandemic levels and driven by our on-going success in customer

retention, monetisation and activation. This ensured that we main-

tained continued high customer engagement, including a high level

of Active Customers, on our platforms.

This was fundamentally achieved as a result of the scalability of

our business and our robust systems architecture, which enables

our platforms to handle tens of millions of transactions every year.

In 2021, for example, we seamlessly and efficiently managed over

57 million customer trades on our platforms, with consistent ser-

vice delivery maintained for our customers, despite many significant

waves of demand which ramped up at very short notice.

We on-boarded a total of 196,336 New Customers in FY 2021 and

our base of Active Customers was 407,374. Both of these metrics

were well ahead of pre-pandemic levels. The heightened level of

New Customers on-boarded in the prior year drove Customer Churn

in FY 2021 to 51.4%. To illustrate the long-term value creation being

delivered by our business model, around $493m of revenue in the

years 2016 to 2021, has been delivered from customers who reg-

istered in 2016, following marketing investment of $125m in that

year. This represents a 294% return on initial marketing investment,

demonstrating the long-term revenue potential being driven by

Plus500’s technology and operating model.

Customer loyalty remained strong, with 79% of our FY 2021 rev-

enues derived from customers trading on the platforms for more

than a year, 35% for more than three years and 16% for more than

five years.

This high level of customer loyalty gives us great confidence that

our customers are using our platforms on a sustainable, long-term

basis, and is the consequence of our continuous investment in our

product offering, our consistently innovative mindset and our on-

going customer-centric approach. With these factors in mind, we

see significant long-term potential from the 2021 customer cohort

going forward.

Client deposits, another key measure of customer loyalty, remained

high in FY 2021 at $2.1 billion, further highlighting the continued

high level of confidence that customers have in Plus500.

Can you discuss your progress on, and future plans

for, how you are deepening customer engagement?

Can you talk about Plus500’s operational

performance in FY 2021?

Q&A with the Chief Executive Officer continued

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

I am very excited about the future of our business, particularly

following our outstanding performance in recent years and the

great progress we have made against our strategic roadmap to

develop our position as a global multi-asset fintech group. We

are now very well placed to access a number of major growth

opportunities, driven by our market-leading proprietary technol-

ogy platforms, with an increasingly diversified and actively

expanding product portfolio and geographic footprint.

What makes me most optimistic about our future is the high

quality, commitment and focus of our talented people in each

of our global locations. I am very grateful to all of them for their

excellent efforts and dedication in ensuring that Plus500 remains

extremely well positioned for sustainable growth in the future.

David Zruia

Chief Executive Officer

22 March 2022

Finally, what are your thoughts on the future

for Plus500?

The high quality,

commitment and focus

of our talented people

ensures that Plus500

remains extremely

well positioned for

sustainable growth

22+

MILLION

REGISTERED

CUSTOMERS

“We achieved a major milestone in reaching a total of over 22 million

registered customers, since Plus500’s inception, on our platforms

across our global operations.

“This achievement reflects our market-leading offering and has been

driven by continued investment in marketing technologies and platform

development. This substantial latent registered customer base repre-

sents a major opportunity for Plus500 through continued customer

retention, activation and monetisation initiatives.

“Ultimately, this will enable us to achieve further growth in our Active

Customer base, thereby increasing revenue and EBITDA over time.”

David Zruia, Chief Executive Officer

Plus500 Ltd. 2021 Annual Report

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

14 Plus500 Ltd. 2021 Annual Report

Plus500’s market-leading proprietary technology ena-

bles it to respond with agility to customer requirements,

fast-emerging market developments and regulatory

changes. The Group’s technology is fully integrated and

inter-connected across its operations, systems archi-

tecture, product and marketing capabilities.

Read more in Our Technology on pages 16 – 19

MARKET-

LEADING

PROPRIETARY

TECHNOLOGY

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

*For illustrative purposes

83%

Over 83% of the Group’s

CFD-related revenue

is generated through

mobile or tablet devices

16 Plus500 Ltd. 2021 Annual Report

PLUS500’S PROPRIETARY

TECHNOLOGY

Our Technology

Our marketing technology efficiently posi-

tions our online marketing campaigns at

an attractive return-on-investment. The

marketing technology includes artificial

intelligence characteristics and its optimi-

sation process is made thanks to its big

data capabilities.

Once a customer has decided indepen-

dently to open an account on our platforms,

the operational element of our technology

is initiated.

At that point, customers go through a strin-

gent, 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 pos-

sible payment methods for our customers.

This is all achieved “behind the scenes”,

ensuring the customer experience remains

efficient and seamless.

Once on-boarded, the next stage of the

customer journey is the on-going product

experience, including a range of educa-

tional and training tools, which is being

continuously updated and upgraded,

through new features, new analysis tools,

new products and new financial instru-

ments. All of these dynamics ensure that

we can drive customer retention and value

over time.

Our proprietary technology stack supports our

customers in every step of their journey with us:

1 2 3

Marketing Operations Product

Agile

Our market-leading technology enables us to

respond with agility to customer requirements

Marketing Operations

Marketing

technology

On-boardingVerification

Payment

processing

Customer

care

On-going

product

usage

Product

upgrades and

improvements

Further

products

added

Product

1 2 3

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

This customer journey is supported and

secured by a robust systems infrastructure,

with a powerful CRM platform, cyber secu-

rity and anti-fraud protection features and

a robust risk management framework.

These elements are a crucial part of our

wholly owned and managed technology

platform. Also, it is important to note that

we have scalable and reliable system archi-

tecture and platforms capabilities which

cater for our customers’ trading activities.

Supported by a robust systems infrastructure:

Systems infrastructure

Robust system

architecture

Cyber

security

CRM

platform

Risk

management

Anti-fraud

management

In-house, tailored technological solutions, equivalent to market-leading SaaS and platform offerings

18 Plus500 Ltd. 2021 Annual Report

Plus500 technology developments during FY 2021

There were a number of important developments made during

the year across each element of Plus500’s proprietary technol-

ogy stack.

Marketing

Plus500 continues to invest in targeted and efficient marketing

technology initiatives, including big data and artificial intelligence

(AI) technologies, as well as data analytics. Plus500 continued

to invest in these initiatives during FY 2021, to drive customer

acquisition, activation, retention and long-term monetisation. In

particular, the Group now has a base of over 22 million registered

customers, to which such initiatives are being targeted, with the

aim of activating and re-activating the customers who are not

current Active Customers.

Such initiatives included multiple customer notification strategies

and a new premium account for customers, including features

such as professional trading webinars, weekly analysis emails

and additional tools.

Through such initiatives, the Group’s unique and wholly-owned

marketing technology remains a fundamental driver to the pros-

pects and performance of the Group, driving customer retention

and cohort value over the long-term.

Operations

The Group’s technology powers its operations, with a consistent

focus on cutting-edge customer service, customer on-boarding,

payment processing and fraud management. During FY 2021,

the operations team implemented additional technologies to

enable new payment methods and developed additional tools

to support product launches and further improvements in cus-

tomer service.

These actions helped to improve customer engagement, drive

internal efficiency, support the Group’s focus on people excellence

and provided an on-going operational platform for future growth.

Product

During FY 2021, Plus500 expanded its range of proprietary trad-

ing solutions into new markets, new platforms and new products.

‘Plus500 Invest’ is now available as a fully mobile-compatible iOS,

Web App and Android product, with a user interface consistent with

the existing trading experience on Plus500’s core product offering,

and a wide range of financial instruments for customers to trade.

This ensures that ‘Plus500 Invest’ has an appropriate and attrac-

tive pricing structure, with advanced charting and analysis tools.

Systems architecture

The Company continued to invest in its systems architecture

during the year, to support customer requirements. The imple-

mentation of Google Cloud Services provides further flexibility,

security and scale to the platform, additional server capacity

and redundancy, as well as enhanced data analysis, data pro-

cessing and business intelligence capabilities.

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.

Our Technology continued

A multi-layered and multi-channel marketing approach, driven by Plus500 technologies

Paid search Organic searchMedia partners Content marketing PR, brand, sponsorships

Artificial Intelligence (AI) Big data Data analytics

DRIVEN BY OUR SOPHISTICATED PROPRIETARY MARKETING TECHNOLOGIES

Partnerships with

leading financial

websites and

portals

Alongside

paid search

campaigns

Technology-

driven educational,

training and

news updates

Brand recognition

through targeted

PR campaigns

and leading sports

sponsorships

Performance

marketing, supported

by major global

technology partners,

such asGoogle

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

Key market trends in FY 2021 and Plus500’s market position

Market volatility across global markets reduced during FY 2021,

compared to the prior year, but remained relatively high, compared

to pre-pandemic levels. This ensured continued trading oppor-

tunities for customers, evidenced by the level of usage on

Plus500’s CFD platform, with over 57 million customer trades

being executed in FY 2021.

Continued automation and digitalisation across the global trad-

ing industry drove further accessibility to, and popularity of,

online channels by customers. To illustrate this, over 83% of the

Group’s CFD-related revenue being generated from mobile or

tablet devices with over 79% of CFD-related customer trades

taking place on mobile or tablet devices in FY 2021.

These factors supported a continued expansion in size of the

addressable global trading market, across geographies, product

types and asset classes.

Regulatory scrutiny continued, ensuring on-going customer

protection and creating barriers to entry for smaller, non-com-

pliant new operators. This ensured a highly compliant and high

quality service was delivered for customers across the industry

as a whole.

1. By total number of customer relationships. Investment Trends 2021

Germany Leverage Trading Report.

2. By total number of customer relationships. Investment Trends 2021

Spain Leverage Trading Report.

3. Year on year active trader numbers. Investment Trends 2021 UK

Leverage Trading Report.

4. Investment Trends 2021 Australia Leverage Trading Report.

5. Investment Trends 2021 Singapore Leverage Trading Report.

6. Google Play as at 2 February 2022.

7. App Annie as at 20 December 2021.

10m

Plus500 app installs

on Google Play

In this market environment, Plus500, supported by its techno-

logical capabilities and its committed and skilled workforce,

remained well positioned to support its customers. This is high-

lighted by the Group maintaining its market-leading positions in

key strategic markets, including Germany

and Spain

, its rank-

ing as the fastest-growing trading platform in the UK

, and as

the most chosen CFD platform for its Mobile App in Australia

and in Singapore

. In addition, the Plus500 app has now achieved

over 10 million installs on Google Play

and achieved a “Top 100

finance apps” ranking in 36 countries on Google Play and in 35

countries on the Apple Store

20 Plus500 Ltd. 2021 Annual Report

DELIVERING

ON OUR PURPOSE

Our Purpose, Strategy and Key Differentiators

Plus500 trading platforms available in

50+ countries

Shareholder returns of

$1.4 billion

since IPO in 2013

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.

We have built a long track record of financial perfor-

mance, with over 25% CAGR in revenue since the IPO

year, and an average EBITDA margin of approximately

57% in that time. We have remained debt free since the

business was established and have continued to be

highly cash generative since that time.

Our powerful

proprietary technology

Our long track record

Read more on pages 16 – 19 Read more on pages 38 – 40

Our purpose is to enable trusted and intuitive access to financial opportunities

for our customers, across a wide range of financial instruments, countries and

devices. This strengthens our position as a global multi-asset fintech group and

is supported by four key differentiators:

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

Plus500 people

450+

at the end of FY 2021

Registered customers on the platforms

globally, since Plus500’s inception

22+ million

Our operating track record and technology development

are testament to the quality of our people. We have

fostered a high-performance organisational culture,

reflecting Israel’s technology-based and innovative envi-

ronment. This has been led by a highly skilled manage-

ment team, with specialist expertise and experience in

technology.

Our agile, customer-centric business model, with its

unique edge in attracting and retaining customers

through multiple channels, strong brand and reputation,

and continued focus on customer care and protection,

has ensured that we have consistently driven an attrac-

tive Return on Investment (“ROI”) over time and will

continue to do so.

Our leadership, people

and culture

Our agile

business model

Read more on pages 30 – 33 Read more on pages 24 – 25

Our strategic roadmap

These differentiators ensure that Plus500 is well positioned to

continue diversifying its revenue streams, product range and

geographic footprint, based on our strategic roadmap of:

–

Expanding our core product offering in new and existing markets;

– Launching new trading and financial products; and

– Deepening engagement with customers.

To access these opportunities, the Group will continue to invest

in future growth, through further organic investments and by

actively targeting additional acquisitions, as well as by activat-

ing potential strategic partnerships, to strengthen our position

as a global multi-asset fintech group.

22 Plus500 Ltd. 2021 Annual Report

Acquisitions of

Cunningham and CTS

During FY 2021, Plus500 executed the US acquisitions

of Cunningham Commodities LLC. (“Cunningham”), a

regulated Futures Commission Merchant, and Cun-

ningham Trading Systems LLC. (“CTS”), a technology

trading platform provider, which established the Group’s

position in the futures and options on futures markets.

Through these transactions, Plus500 immediately

expanded its geographic footprint and product offering

in the significantly growing, but under-penetrated, retail

trading market in futures and options on futures.

The integration of these acquisitions is underway, in

line with our strategic roadmap, with a number of R&D

recruitments during FY 2021 specifically focused on

leveraging Plus500’s best-in-class technology to opti-

mise the acquired businesses. Ultimately, this will help

to deliver market access to the millions of potential

customers looking for new trading opportunities and

ideas.

Plus500 aims to be a technology disruptor in this mar-

ket, where the competitive environment is fragmented,

the utilisation of technology platforms is relatively lim-

ited and the range of asset classes for customers to

access is becoming increasingly broad and accessible.

Consequently, by applying Plus500’s best-in-class tech-

nology and expertise, the Group is confident that it will

be able to offer accessible futures and options on futures

products to a mass retail audience, thereby delivering

on a major market opportunity.

LAUNCHING

NEW PRODUCTS

DELIVERING ON

OUR STRATEGY

Our Strategy in Action

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

We believe that the global

futures market is a major

strategic opportunity for

Plus500, as we look to expand

in this significant potential

market, which is being driven by

substantial management focus

and continued investment in

technology and people.

David Zruia, Chief Executive Officer

24 Plus500 Ltd. 2021 Annual Report

Resources and relationships How we create and maximise value

Financial position

The Group has built a strong financial track

record, maintaining a debt-free balance sheet

since inception, with a lean and flexible cost

structure. Read more on page 38

Technology

Plus500 operates its robust and agile trading

platforms which are based on its proprietary

technology. Read more on page 16

Regulators

Continued compliance with appropriate global

regulatory standards. Read more on

page 28

Marketing Partnerships

Plus500 has marketing partnerships and

sponsorship agreements to support its

efforts in attracting customers and driving

brand awareness in strategic markets. Read

more on page 29

People

Our people are crucial in the on-going optimi-

sation and management of the Group’s tech-

nology platforms and its ability to attract and

retain customers. Read more on pages 30 – 33

Our robust and scalable business model cre-

ates value for our stakeholders

Responding to market trends…

Underpinned by…

With a clear purpose and strategy…

Market environment: volatility drives opportunities

for customers to trade

Comprehensive risk management

Proprietary risk management that incorporates

real-time functionality risk management systems

and trading threshold triggers to reduce risk

Sound governance

The Plus500 Board is comprised of a diversified

and highly experienced group of individuals with

extensive knowledge across a number of disciplines,

in particular financial services and technology

Our purpose is to enable trusted and intuitive access to finan-

cial opportunities for our customers, across a wide range of

financial instruments, countries and devices, to drive our con-

tinued progress as a global multi-asset fintech group.

Continued growth in popularity of trading: size of

the addressable market continues to grow

Further automation across the industry: greater

accessibility to digital channels by customers

On-going regulatory scrutiny: ensures continued

customer protection

AN AGILE, CUSTOMER-

CENTRIC BUSINESS

Our Business Model

25Plus500 Ltd. 2021 Annual Report

Governance Financial statementsStrategic report

Value created in FY 2021

EBITDA

$387.1m

Basic earnings per share

$3.06

Shareholder returns

$200.2m

Customer deposits

$2.1bn

Operating cash conversion

99%

Shareholders and investors

The Group has delivered attractive returns through ordinary

and special dividends as well as ordinary and special share

buybacks. Total returns in dividends and share buybacks

since IPO in 2013 amount to approximately $1.4 billion

People

Plus500 offers rewarding and interesting careers, with oppor-

tunities for our people to achieve long term development

and career progression

Marketing partners

The cooperation of the Company with its marketing partners

provides all parties with economic value and synergy

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

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

How we share value

1. Operating cash conversion: Cash generated from operations / EBITDA.

$3 87.1m

$515.9m

$192.3m

2019

2020

2021

2020

2019

2021

$718.7m

$872.5m

$354.5m

26 Plus500 Ltd. 2021 Annual Report

Key Performance Indicators

MEASURING OUR

PERFORMANCE

Revenue

$718.7m

in FY 2021

REVENUE

Read more on pages 38 – 40

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 profitabil-

ity to that of other companies and other sectors.

Our Key Performance Indicators (“KPIs”) can be used to bench-

mark the Group’s performance and our ability to drive returns on

investment over time.

Financial KPIs

1 Customer Trading Performance – gains/losses on customers’

trading positions

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

Non-financial KPIs

ARPU AUAC

What it is

ARPU is calculated by dividing the revenue by the num-

ber 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 attrac-

tive return-on-investment over time.

What it is

AUAC shows the average cost of attracting a new cus-

tomer 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.

What it is

Active Customers are customers who made at least

one trade using real money (rather than trading through

a demo account) on the trading platform in the relevant

period.

Why we measure it

This measure reflects the level of customer activity on

the trading platform during the relevant period. It is an

indicator of how successful the Group is in attracting

and retaining customers, with a view to delivering sus-

tainable revenue and profits.

What it is

New Customers are customers who have deposited

real money into their trading account for the first time.

Why we measure it

This metric tracks the number of new customers the

Group attracts on a year-on-year basis. This helps us

to understand the success of our technological capa-

bilities and effectiveness of marketing initiatives.

ACTIVE CUSTOMERS NEW CUSTOMERS

$1,764

$2,009

$1,775

2019

2020

2021

407,374

434,296

199,720

2019

2020

2021

196,336

294,728

91,388

2019

2020

2021

$877

$750

$1,046

2019

2020

2021

28 Plus500 Ltd. 2021 Annual Report

Customers

Why we engage

We aim to ensure that Plus500 continues

to provide a consistent, best-in-class ser-

vice to our customers and that we con-

tinue 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 cus-

tomer care and protection is maintained,

through educational tools and risk man-

agement 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 sup-

port them with their trading activities.

CFD customers are able to use our free

demo account on an unlimited basis,

through which they can try our service in

a risk-free environment.

In addition, we conduct customer surveys

to better understand their views on

Plus500’s service, so that we can con-

tinue to innovate and develop our product,

based on customer feedback.

Key focus areas

– Consistent level of service delivery;

–

Continued 24/7 customer service avail-

ability;

–

Further expansion of range of educa-

tional 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.

People

Why we engage

Organisational culture and employee well-

being are critical in ensuring that our

service is delivered to customers, through

the on-going development of our technol-

ogy by our people, on a consistent, long-

term basis. With this in mind, the Group

regards its talented and committed peo-

ple as its key asset to enable its technol-

ogy.

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 encour-

age our people to participate in training,

learning and development, and make

them aware of possible career progres-

sion 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 engage-

ment programmes. In addition, we sup-

ported our people to work remotely

throughout the COVID-19 pandemic.

One of our Non-Executive Directors, Steve

Baldwin, is the workforce engagement

representative on the Board to provide a

channel through which our people can

raise their views directly to the Board,

informing the Board’s approach to sup-

porting 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 pro-

gression; and

–

Continued communication of people

matters to the Board.

Regulators

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, to ensure that we are

offering our service within the appropriate

regulatory rules and guidelines. Regula-

tory compliance procedures are con-

stantly reviewed and enhanced, with a

culture of compliance embedded within

the business, including open and con-

structive communications with relevant

regulatory bodies.

How we engage

The Group communicates with regulators

on an on-going, constructive and open

basis and we participate in a number of

regulators’ co-ordination groups. In addi-

tion, we contribute to public consultations

issued by regulators on relevant industry

matters.

Key focus areas

–

Continued monitoring of and compli

ance with appropriate laws, global

regulatory standards and industry best

practices;

–

Rapid implementation of regulatory

changes, driven by our proprietary tech-

nology; and

–

On-going communication with, and sup-

port of, regulators in current and poten-

tial future regulatory jurisdictions.

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, with a

view to ensuring their perspectives and

concerns are clearly understood by the

Board and fully incorporated into the

Board’s discussions and decision-making.

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

Communities

Why we engage

Engagement with local communities is

crucial from social welfare and sustain-

ability 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 com-

munities and charities. These include

on-going monetary contributions and the

provision of resources and equipment to

a number of charities, non-profit organisa-

tions, community centres and disadvan-

taged families in local communities.

The Group also maintains strategic part-

nerships and alliances with community

partners, including our on-going collabo-

ration with top tier academic institutions,

for example the Technion – Israel Institute

of Technology, through which we par-

ticipate in several innovation and entre-

preneurship 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 partner-

ships with top tier academic institutions.

Investors

Why we engage

Plus500 aims to provide fair, balanced

and understandable information to inves-

tors and shareholders, to ensure their

continued support of the Company. Main-

taining a close connection to its share

holders through clear and transparent

dialogue continues to be a major focus

for the Group. 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 pres-

entations, conference attendance and

group meetings, such as the Annual Gen-

eral Meeting. In addition, the Company

produces a variety of investor-focused

material, including annual reports, news

published on the Regulatory News Service

and investor presentations. These are

available on a recently refreshed and

updated dedicated Investor Relations

website.

Key focus areas

–

On-going transparent dialogue with

investors;

–

Open lines of communication for share-

holders;

–

Regular collection of investor feedback

and dissemination to the Board; and

–

Executive management participation in

investor-focused events and activities.

Marketing partners

Why we engage

Plus500 works with various marketing

partners, including sports sponsorship

partners, who support the Group with

various activities.

How we engage

We build strong partnerships with market-

ing partners through an open dialogue to

ensure we can develop long-term valu-

able relationships.

Our relationships with our marketing part-

ners include the on-going review and

monitoring of their performance levels,

to ensure that the Group is achieving qual-

ity and value from its partnerships. Ulti-

mately, this helps to build mutually

beneficial relationships with our market-

ing partners.

Key focus areas

–

On-going dialogue with our marketing

partners;

– Continued fair treatment of marketing

partners in our dealings with them; and

–

Consistent focus on innovation and new

initiatives to help deliver enhanced

value from marketing partnerships.

Connected

We create an open dialogue with our stakeholders

to ensure their perspectives and concerns are

clearly understood.

30 Plus500 Ltd. 2021 Annual Report

Our ESG Approach

ENVIRONMENTAL, SOCIAL

AND GOVERNANCE

Introduction

The Board established an ESG Committee in FY 2020 to oversee and

support the Group’s approach in this area, and this Committee’s report

for FY 2021, presented by its Chair, Daniel King, can be found on pages

71 – 73 of this Annual Report. The Committee is supported by an ESG

working group, comprising of the Company Secretary and Head of

Investor Relations, with on-going input from a specialist ESG consul-

tancy.

The Group remains committed to operating responsibly and sustain-

ably in all aspects of its business, carrying out a range of ESG initiatives

to deliver tangible value for our 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 oper-

ate in 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.

In FY 2021, the ESG Committee commissioned a materiality assess-

ment to identify the key ESG priorities and risk factors for the Group,

based on a series of detailed interviews with a number of key internal

and external stakeholders. The objective of this assessment was to

help establish a framework for the Group’s future approach in key ESG

areas and, ultimately, to increase the Group’s resilience over the long

term.

This assessment identified several ESG priority areas for Plus500.

These areas were: customer care and protection, organisational culture,

cyber security, systems infrastructure and leadership and governance.

This year’s ESG report covers the Group’s progress in each of these

areas in FY 2021, as well as other important related priority areas. In

addition, this report includes new information and data about the

Group’s approach to the potential environmental impact of its opera-

tions and incorporating the Group’s initial reporting in relation to the

Task Force on Climate-related Financial Disclosures (TCFD).

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 Manage-

ment Framework sections on pages 28 – 29 and 41 – 45 of this Annual

Report outline how the Group is mitigating these risks in more detail.

Leadership and governance

It is crucial for Plus500 to remain in compliance with applicable govern-

ance requirements, in particular ensuring the appropriate Board com-

position and diversity (including gender diversity), and maintaining a

remuneration policy for directors and executives which is aligned to

long-term shareholder interests.

In addition, the Board is cognisant 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 54 – 58, with biographies of each Board

member on pages 52 – 53.

Customer care and protection

Customer care and protection, in particular ensuring customers remain

protected from, and well informed of, the risks of trading, remains a

critical priority for the Group, in line with regulatory requirements in this

area. This is not only a specific risk to Plus500, but also across the

entire industry.

Measures such as negative balance protection and maintenance mar-

gin protection on the Group’s CFD trading platform remain crucial in

ensuring customers are well protected, having been embedded in

Plus500’s technology since its inception.

In addition, a free demo account is available on an unlimited basis for

CFD platform customers, while sophisticated risk management tools

are provided free of charge for customers to manage leveraged expo-

sure, including measures such as stop losses.

In FY 2021, the Group continued to develop its range of educational

and training tools and features on its platforms, to help inform custom-

ers of the inherent potential risks involved in trading, as well as ensur-

ing risk warnings are prominent on its platforms and marketing

materials.

The Group continues to ensure compliance with global regulatory

standards in this area and remains well positioned for any potential

future regulatory changes. This is supported by the Group’s established

global regulatory network, which is managed by its regulated subsidi-

aries and overseen centrally on an on-going basis.

The Group’s approach to ESG is aligned to its purpose of enabling trusted and in-

tuitive access to financial opportunities, supported by on-going engagement with

its customers and also with shareholders and potential investors, analysts, share-

holder advisory bodies, ESG ratings agencies, employees and other stakeholders.

31Plus500 Ltd. 2021 Annual Report

Governance Financial statementsStrategic report

Organisational culture

Organisational culture, with a focus on employee health, safety,

well-being, welfare and development, is another important priority

for the Group to drive long-term business resilience. The Group

aims to continue attracting and retaining high quality talent, which

ultimately ensures the delivery of a consistent level of high quality

products and services for customers.

Employee development

The Group’s head office is in Israel, a major global hub for technol

ogy 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 envi-

ronment. The Group aims to replicate this cultural mindset in each

of its global operating 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 regular performance evaluation

programmes 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 ena-

bles 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.

Employee health, safety and well-being

The Group is particularly dedicated to the health, safety and well-

being of its people and aims to continue to provide them with

optimal working conditions to support a healthy, safe and balanced

working environment, particularly throughout the challenging period

of the COVID-19 pandemic. During that time, the Group embraced

a hybrid working model, enabling flexible working, as well as provid-

ing employees with on-going access to COVID-19 test kits and

sanitary equipment.

In addition, the Group provided on-going guidance on well-being

issues and flexibility around childcare and family support, with

employees at the Group’s headquarters and certain subsidiaries

continuing to be offered annual health and medical checks at a

local hospital.

Responsible

Plus500 remains committed to operating

responsibly and sustainably in all aspects

of its business, to help deliver tangible

valuefor our stakeholders

32 Plus500 Ltd. 2021 Annual Report

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 wellness

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

an annual employee event in Israel with various departments arranging

regular “family days” and team events across its global operations.

The Group’s approach to equal opportunity, protecting human rights

and employee diversity

Plus500 is committed to maintaining high ethical standards and pro-

tecting 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 2021, 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, Diver-

sity and Inclusion Policy with respect to candidate selection processes,

hiring, promotion, compensation, training and assignment of respon-

sibilities, termination or any other aspect of the employment relation-

ship.

The Group is also committed to equality and fairness to all and does

not provide less favourable facilities or treatment on the grounds of

age, disability, gender reassignment, marriage and civil partnership,

pregnancy and maternity, race, ethnic origin, colour, nationality, national

origin, religion or belief, or gender and gender orientation, social back-

ground, political opinion, sensitive medical conditions or trade union

membership.

To this end, 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.

The Group is committed to:

– Creating an environment in which individual differences and the con-

tributions of all team members are recognised and valued;

–

Creating a working environment that promotes dignity and respect for

every person;

–

Not tolerating any form of intimidation, bullying or harassment, and

disciplining those that breach the policy;

– Ensuring availability of training, development and progression oppor-

tunities for all of our people;

– Promoting equality in the workplace;

– Encouraging anyone who feels they have been subject to discrimina-

tion to raise their concerns and to take those concerns seriously;

–

Regularly reviewing employment practices and procedures so that

fairness is maintained at all times; and

– Encouraging our people to treat everyone with dignity and respect.

The Equality, Diversity and Inclusion Policy is monitored and reviewed

annually by the Board, with the assistance of the Nomination Commit-

tee and the ESG Committee to ensure that equality and diversity is

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.

Our ESG Approach continued

213

(46%)

Male Female

248

(54%)

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

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 2021 were as

follows:

FEMALE MALE TOTAL

Board 3 (38%) 5 (62%) 8

Senior management 12 (39%) 19 (61%) 31

All Employees 213 (46%) 248 (54%) 461

Senior management in the table above includes executive management

and the first layer of management below. During FY 2021, gender

diversity at Board level was improved further through the appointments

of Sigalia Heifetz as an Independent Non-Executive Director and Tami

Gottlieb as an Independent Non-Executive Director and External Direc-

tor. Also, as announced in March 2022, Prof. Varda Liberman was

appointed as an Independent Non-Executive Director.

Consequently, as at the date of this Annual Report, female representa-

tion on the Board comprised 44% (four female Directors out of nine

Directors). Furthermore, following the tenure of Daniel King finishing

in June 2022, as outlined in more detail on page 50 of the Governance

section of this Annual Report, female representation on the Board will

increase to 50% (four female Directors out of eight Board members).

These appointments not only continue to diversify the Board’s gender

composition, but also further expand 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 com-

petitive advantage and effective governance, as well as mitigating the

risk of a “group think” culture.

GENDER EQUALITY:

ALL EMPLOYEES (%)

Read more on pages 60 – 63

More information on the Board’s Equality,

Diversity and Inclusion Policy can be found on

page 62 of this Annual Report. This policy can

also be found on the Company’s website

34 Plus500 Ltd. 2021 Annual Report

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.

Information and data security is managed through a dedicated and

specialist cyber security team, based at the Group’s headquarters and

reporting to the Group’s Chief Operating Officer, with ultimate oversight

from the Audit Committee of the Board. 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.

The cyber security team manages a range of regular training pro-

grammes and activities to all Group personnel (including the Board) to

ensure consistent and robust management of cyber security risk and

to minimise any external threats to the Group’s platforms, systems and

data. As a result of these initiatives, there were no significant security

or data breaches across the Group’s platforms during FY 2021.

Systems infrastructure

Maintaining a robust systems infrastructure, with embedded risk man-

agement 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 continued to invest in its systems architecture during

FY 2021, to support customer requirements. The implementation of

Google Cloud Services provides further 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 sig-

nificant 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 in the UK, Plus500 is subject to the UK Bribery

Act 2010 and, as an Israeli-incorporated company, 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 Company’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 our people, 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 us, or any 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;

– Lobbying expenditures;

– 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 sug-

gest, 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 effec-

tive 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

regular, relevant training on how to implement and adhere to all aspects

of the policy and are asked to formally confirm compliance with the

policy on an annual basis.

Our ESG Approach continued

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

This Anti-Bribery Policy and its implementation is reviewed on a regu-

lar 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 kind, in support of any

political parties or candidates. In addition, to avoid criminal offence

and to protect the Company’s reputation, it is important that the Com-

pany does not become involved with third party criminal activities. To

this end, the Company 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 activ-

ity, 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.

During FY 2021, supervised by the Group’s Donations Committee, the

Group donated approximately $80,000 to various community projects

and Non-Profit organisations in Israel, including a youth support pro-

gramme and a number of education support and enrichment pro-

grammes for deprived and vulnerable children in local communities.

In addition, the Group donated IT equipment to various charities and

local community initiatives.

Plus500 maintains strategic partnerships and alliances with commu-

nity partners, such as the on-going collaboration with top tier academic

institutions like the Technion – Israel Institute of Technology, participat-

ing in innovation and entrepreneurship initiatives.

The Group aims to carry out new employee-volunteer community ini-

tiatives in the local community going forward, many of which were put

on hold during the COVID-19 pandemic.

Impact on the environment

As a technology-based business, Plus500 does not carry out any

industrial activity, is not involved in anything which would emit envi-

ronmentally harmful substances and has a relatively low environmen-

tal impact. However, 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. Consequently, the Group aims

to ensure that it conducts appropriate and necessary actions to mini-

mise 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; and

– Provide environmental training for employees.

36 Plus500 Ltd. 2021 Annual Report

FY21 FY20

GLOBAL

(EXCL. UK)

GROUP

TOTAL UK

GLOBAL

(EXCL. UK)

GROUP

TOTAL

Total Group energy consumption (kWh) 39,706 535,670 575,376 21,539 418,973 440,512

FY21 FY20

GLOBAL

(EXCL .UK)

GROUP

TOTAL UK

GLOBAL

(EXCL .UK)

GROUP

TOTAL

Total Scope 1 (tCO2e) 0 0 0 0 0 0

Total Scope 2 (tCO2e) 7.6 227.5 235.1 4.1 182.8 186.9

Total tCO2e 7.6 227.5 235.1 4.1 182.8 186.9

Intensity measure (Group turnover $’m) 718.7 872.5

GHG Emissions Intensity ratio (per Group turnover $’m) 0.33 0.21

Emissions reporting, targets and approach to emissions reduction

Supported by a number of initiatives being carried out by the Group to

deliver on these commitments, and thereby addressing Plus500’s

potential impact on climate change, the Group has set a target of being

carbon negative and net zero for Scope 1 and Scope 2 emissions by

2030 or earlier.

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):

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 2021, electricity consumption and expenditure increased due to

less remote working compared to the prior year, certain subsidiaries

moving to larger offices to accommodate growth and the additions of

Cunningham and CTS in the US, which were acquired in July 2021, and

a new office in Tel Aviv.

The Group’s commitment to become carbon negative and net zero for

Scope 1 and Scope 2 emissions by 2030 will be supported by a number

of activities. In particular, the Group regularly looks for opportunities

to improve the efficiency and performance of its servers and third party

data centres, including upgrading their hardware and software on a

regular basis. In addition, the Group will continue to investigate oppor-

tunities to manage and operate more services through Google Cloud

and other remote platforms, thereby optimising the utilisation of ter-

restrial infrastructure and reducing electricity usage.

Energy efficiency has been optimised in recent years as a result of a

greater level of flexible working, compared to pre-pandemic levels, and

through the utilisation of video-conferencing facilities which has reduced

the requirement for employee travel. The Group is investigating 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 Company is also taking steps to diversify its investments within

the sustainability eco-system. For example, during FY 2021, Plus500

worked with a key relationship bank to re-classify a portion of its fixed

bank deposits as “Green Deposits”, which the bank uses to invest in

areas such as energy-efficiency activities and renewable energy projects.

The Group has adopted an Environmental Policy, which can be found

on the Company’s website.

Recommendations of the Task Force on Climate-related Financial

Disclosures

The Group recognises the significance of climate change for all busi-

nesses and therefore welcomes and supports the recommendations

of the TCFD for more consistent disclosure on climate-related financial

risk disclosures by companies.

During FY 2021, the Group carried out a gap analysis and peer group

analysis, to review, amongst other elements, the Group’s current climate-

related disclosure and to better understand best practice reporting on

TCFD and climate-related disclosures across the UK-listed peer group

and US-listed fintech space. The Group will continue to be consistent

with, and in compliance with, TCFD recommendations in its disclosures.

Supported by the analyses carried out in FY 2021, Plus500’s progress

against the TCFD recommendations is provided on the following page,

together with our future plans.

Our ESG Approach continued

37Plus500 Ltd. 2021 Annual Report

Governance Financial statementsStrategic report

Governance

Current approach:

– The Board oversees all aspects of ESG, including climate-related

risks and opportunities for the Group;

– The Board has established an ESG Committee, chaired by Daniel

King, (see page 72 for details of the composition of the Commit-

tee) to monitor on progress against the Group’s ESG approach

and priority areas, and to externally report these elements, includ-

ing climate-related risks and opportunities. The ESG Committee

receives input from executive management and is supported by

the Group’s ESG working group, which comprises the Company

Secretary and Head of Investor Relations, with on-going input

from a specialist ESG consultancy;

–

The ESG Committee reviews ESG-related risks, including climate-

related risks;

– The ESG Committee provides regular updates to the Board on all

of these elements;

–

The ESG Committee met four times during FY 2021 and regu-

larly reported back to the Board during the year; and

– The external reporting of Scope 1 and Scope 2 emissions target

is now part of the Group’s annual reporting.

Future plans:

–

On-going review and monitoring of the implementation of the

Group’s approach to ESG, including any potential climate-related

impact, by the ESG Committee and executive management; and

–

Continued review of the Group’s ESG reporting and disclosure,

including any updates to the Group’s environmental targets,

by the ESG Committee, in line with best practice and the latest

regulations.

Strategy

Current approach:

–

In delivering on the Group’s purpose to enable trusted and intuitive

access to financial opportunities, Plus500 is committed to man-

aging 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; and

–

The Group aims to ensure that it conducts appropriate and neces-

sary actions to minimise the impact of its infrastructure and

operations on the environment, including upgrading hardware to

improve efficiency and performance. During the year, the Com-

pany worked with a key financial institution to re-classify a portion

of its fixed short-term bank deposits as “Green Deposits”, which

the financial institution uses to invest in areas such as energy-

efficiency activities and renewable energy projects.

Future plans:

– The Group will continue assessing how climate-related risks and

opportunities impact both the business and its purpose of enabling

trusted and intuitive access to financial opportunities, as well as

its strategic and operational approach to delivering on this purpose;

– The Group will continue to identify climate-related risks through

regular risk management processes, overseen by the ESG Com-

mittee;

–

In FY 2022, the ESG Committee is aiming to conduct an initial

scenario analysis of the impact of climate change on the Group’s

purpose, strategy and future operational performance; and

–

The Group will continue to be committed to minimising the impact

of its operations on the environment by adopting responsible

environmental practices.

Risk management

Current approach:

–

The ESG Committee receives reports on ESG risks identified

through the Group’s risk management process. The ESG Com-

mittee 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 advises the Board on current and future

strategies regarding climate-related risks and opportunities; and

–

The ESG working group was established during FY 2021 to

support the ESG Committee in monitoring and reviewing ESG

risks and opportunities.

Future plans:

–

The ESG Committee will continue to identify, assess, manage and

prioritise climate-related risks and opportunities.

Metrics and targets

Current approach:

–

The Group has disclosed its Scope 1 and 2 emissions data, as

outlined on page 36, and will continue to do so on an annual basis;

– Plus500 has set a target of being carbon negative and net zero

in its Scope 1 and 2 emissions by 2030 or earlier; and

–

Progress against these targets will be disclosed on an annual

basis.

Future plans:

– The Group is investigating ways to collect, collate and report on

its Scope 3 emissions;

– Once finalised, the Group will report its Scope 3 emissions going

forward, thereby expanding its disclosure in this area; and

–

The Group is committed to regularly reviewing its climate-related

metrics, targets and progress against these targets and will update

its disclosure as and when appropriate.

The Group has reported above on the most relevant and appropri-

ate elements of TCFD for Plus500. Going forward, the Group will

continue to assess its climate-related risks, priorities and oppor-

tunities, to ensure that its reporting in relation to TCFD recom-

mendations continues to be consistent, and in compliance, with

these recommendations, and will evolve and develop over time.

38 Plus500 Ltd. 2021 Annual Report

The Group’s operational performance in FY 2021 translated into another

outstanding financial performance across all metrics during the year,

ahead of the Group’s pre-pandemic performance in FY 2019, highlight-

ing Plus500’s resilient technology and sustainable business model.

Revenue and EBITDA

The Group generated total revenue of $718.7m in FY 2021 (FY 2020:

$872.5m, FY 2019: $354.5m).

Customer Income, a key measure of the Group’s underlying performance,

was consistently strong throughout FY 2021 at $702.8m (FY 2020:

$997.5m, FY 2019: $382.4m).

Customer Trading Performance was $15.9m during FY 2021 (FY 2020:

$(125.0m), FY 2019: $(27.9m)). The Company continues to expect that

the contribution from Customer Trading Performance will be broadly

neutral over time.

Supported by the Group’s lean and flexible cost base, EBITDA for FY2021

was $387.1m (FY 2020: $515.9m, FY 2019: $192.3m). EBITDA margin

remained strong during FY 2021 at 54% (FY 2020: 59%, FY 2019: 54%).

Cost base

Costs remained well controlled and 72% of the Group’s costs were

variable (FY 2020: 80%, FY 2019: 71%), with the Group maintaining a

flexible cost base. The Group’s variable costs remain positively correlated

to enhanced performance and higher volumes, including marketing

investment and payment processing expenses.

Marketing technological investment was $172.1m during FY 2021

(FY2020: $221.1m, FY 2019: $95.6m). This investment will continue

to be made to ensure that the Group is able to capture opportunities

to drive future anticipated attractive Return on Investment (“ROI”).

Financial and Business Review

WELL POSITIONED

FOR GROWTH

Revenue

$718.7m

(FY 2020: $872.5m)

EBITDA

$387.1m

(FY 2020: $515.9m)

Net profit

$310.6m

(FY 2020: $500.1m)

Operating Cash Conversion

99%

(FY 2020: 106%)

With solid financial

foundations, Plus500 is

well positioned to deliver

on its strategic growth

ambitions, through both

organic investments

and acquisitions.

Elad Even-Chen, Chief Financial Officer

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

Total SG&A expenses were $334.1m during FY 2021 (FY 2020: $358.9m,

FY 2019: $164.4m), the major elements of which were the marketing

investment outlined above, processing costs of $40.8m (FY 2020:

$53.0m, FY 2019: $15.8m) and payroll and related expenses of $33.0m

(FY 2020: $26.0m, FY 2019: $22.6m).

AUAC was $877 in FY 2021 (FY 2020: $750, FY 2019: $1,046), with

on-going investment being made in strategic markets to attract high

value customers. Given the strength of the Group’s marketing technol-

ogy and Plus500’s long track record of delivering high returns on mar-

keting investment, the current investment cycle is expected to continue

delivering an attractive ROI.

The Group continues to expect that AUAC will rise steadily over time,

as the Group’s customer profile continues to shift to higher value

customers and as the Group invests in attracting customers to the

new trading products in its portfolio and targeting customers in stra-

tegic geographies.

Net financial income

Net financial income (expense) amounted to $1.8m in FY 2021 (FY2020:

$9.7m, FY 2019: $(0.8m)), predominantly due to foreign exchange and

translation differences, in addition to interest received related to fixed

deposits and tax rebates. A substantial proportion of the Group’s cash

is held in US dollars in order to provide a natural hedge, thereby reduc-

ing the impact of currency movements on financial expenses.

Corporate Tax

As well as being driven by the Group’s operational performance, net profit

and earnings per share were also supported by a reduction in the cor-

porate tax rate to 12% for Plus500 Ltd., from the full corporate tax rate

of 23% previously. This was due to the Company receiving approval from

the Israeli Tax Authority (ITA) recognising the Company as a “Preferred

Technological Enterprise” (PTE). In addition, the withholding tax rate

applicable for dividends in FY 2021 was reduced from 25% to 20%.

On 18 January 2022, the Company announced that this accreditation

had been successfully extended for FY 2022, FY 2023, FY2024, FY2025

and FY2026, with Plus500 Ltd.’s corporate tax rate for each of these

financial years, to be reduced from 23% to 12%, and the withholding

tax rate applicable for dividends to be reduced from 25% to 20%, sub-

ject to the Company complying with the conditions of the Law for the

Encouragement of Capital Investments.

Net profit and earnings per share

Net profit in FY 2021 was $310.6m (FY 2020: $500.1m, FY 2019: $151.7m)

and basic earnings per share was $3.06 (FY 2020: $4.71, FY 2019: $1.35).

Balance sheet and cash generation

As at the end of FY 2021, total assets were $822.8m (FY 2020: $620.2m,

FY 2019: $316.9m) with equity of $661.3m representing approximately

80% of the balance sheet.

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 $383.0m (FY 2020: $546.6m, FY 2019: $170.1m) and 99%

operating cash conversion achieved (FY 2020: 106%, FY 2019: 88%).

During FY 2021, the Company completed several share buyback pro-

grammes totalling $64.9m. In addition, $144.9m in dividends were

declared and paid to shareholders during the year as interim, final and

special dividends.

The Group remains debt-free, as it has been since its inception, with

cash balances and cash equivalents at the end of FY 2021 of $749.5m

(FY 2020: $593.9m, FY 2019: $292.9m).

Presentation of currencies

The consolidated financial statements are presented in US dollars,

which is the Company’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.

Business development

The Group made excellent progress, from a business development

perspective, during the year in pursuing a range of potential growth

opportunities. Major achievements included the due diligence, nego-

tiations and completion of the Cunningham and CTS acquisitions in

the US, as well as obtaining a new regulatory licence in Estonia, granted

on 7 February 2022, supported by the establishment of a new local

subsidiary.

In March 2022, following a lengthy assessment of the market oppor-

tunity in Japan, the Company completed an acquisition of a local firm

regulated by Japan’s Financial Services Agency as a Type 1 Financial

Instruments Business Operator. This represents a major growth oppor-

tunity for Plus500, through an immediate presence in the substantial

retail trading market in Japan.

In addition, the business development team made great progress in

furthering a number of other growth initiatives, including advancing

the Group’s position with a number of potential other regulatory licence

applications and acquisition targets. The team continues to explore a

range of opportunities to support the Group in its growth ambitions,

including investigating potential new products and market opportuni-

ties.

Shareholder returns

The Company’s shareholder return policy is to return at least 50% of

net profits to shareholders through dividends and share buyback pro-

grammes, with at least 50% of this distribution being made by way of

dividends. For FY 2021 and in previous years, this shareholder return

policy has been based on a 23% corporate tax rate, for both interim

and final dividends. In addition, the Board has considered paying spe-

cial dividends and executing special share buyback programmes at

year end.

The Board will review the basis of this policy for future shareholder

returns, in light of the successful extension of Plus500 Ltd.’s status as

a PTE, as outlined above, and the consequent reduction in its corporate

tax rate from 23% to 12% for each financial year up to and including

FY 2026, subject to the Company complying with the conditions of the

Law for the Encouragement of Capital Investments.

40 Plus500 Ltd. 2021 Annual Report

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 under-

take any aggressive or unreasonable tax planning schemes

for the purpose of tax avoidance, and broadly aim 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 com-

panies to receive approval from both the Israeli Tax Author-

ity and the Israeli Innovation Authority under the new tax

regime in Israel, recognising the Company as a “Preferred

Technological Enterprise” and as “an enterprise which pro-

motes innovation”.

Consequently, the Plus500 Ltd. Corporate Tax rate for the

financial years 2017, 2018 and 2019 was reduced from 24%,

23% and 23% in each respective year to 12% in each of these

years. This updated Corporate Tax rate of 12% was also

applicable for FY 2020 and FY 2021 and the Withholding

Tax rate applicable for dividends was reduced from 25% to

20% for both financial years.

On 18 January 2022, the Company announced that this

accreditation had been successfully extended for FY 2022,

FY 2023, FY 2024, FY 2025 and FY 2026, with Plus500 Ltd.’s

Corporate Tax rate for each of these financial years, to be

reduced from 23% to 12%, and the Withholding Tax rate

applicable for dividends to be reduced from 25% to 20%,

subject to the Company complying with the conditions of

the Law for the Encouragement of Capital Investments.

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.

The Board has declared on 15 February 2022 a total distribution of

$115.0m in relation to FY 2021, which comprises a distribution of final

and special dividends and new share buyback programmes, including

a special buyback programme. This makes a total dividend for the year

of $120.0m, representing $1.1916 per share (total dividend for FY 2020:

$1.7823 per share). The total dividend includes a final dividend for

FY2021 of $37.8m, representing $0.3777 per share (final dividend

FY2020: $0.5422 per share), a special dividend for FY 2021 of $22.2m,

representing $0.2218 per share (special dividend FY 2020: $0.2870 per

share) and an interim dividend of $60.0m. The interim dividend was

distributed to shareholders in November 2021 and the final and special

dividends had an ex-dividend date of 24 February 2022, with a record

date of 25 February 2022, and a payment date of 11 July 2022.

During FY 2021, the Company executed its existing share buyback

programmes, with 3,406,211 ordinary shares purchased during the

year, amounting to a total of $64.9m, at an average share price of £13.9,

including $22.4m in H2 2021.

In addition, the Board initiated a new share buyback programme in

FY2022 to acquire up to $55.0m of the Company’s shares. This includes

a new share buyback programme of $25.2m and a special share buy-

back programme of $29.8m.

The purpose of the new programmes is to further emphasise the Board’s

confidence in the prospects of Plus500 and reflects the robust financial

position of the Group, as highlighted by the Group’s operational and

financial performance in FY 2021.

The special dividend and the special share buyback programme are

directly related to the benefits of the change in tax rate from the Israeli

statutory rate of 23% to 12%, following the Company’s successful

extension of its PTE accreditation.

Elad Even-Chen

Chief Financial Officer

22 March 2022

Group Tax Policy

Financial and Business Review continued

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

Assessing and managing our risks

The Group maintains a robust, customer-centric approach to the man

agement 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. These proce-

dures comprise a range of measures including corporate policies,

operating rules, systematic reporting, external audits, internal audits,

self-assessment and continuous monitoring by the Regulatory & Risk

Committee, the Board and executive management.

Risk governance framework

The financial, market and regulatory environments in which Plus500

operates inherently expose it to a number of strategic, financial, oper-

ational 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.

To this end, 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 is currently investigating and testing 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 protection and customer experi-

ence, helping to deliver a more stable revenue stream over time, given

the consequently lower level of top line volatility. As evidence of this,

Group revenue represents around 98% of Customer Income that has

been generated since Plus500’s IPO in 2013. 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 2021 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 customers accounts pre-funded. The Group also offers

negative balance protection and a margin close-out policy to all of its

CFD customers on a global basis.

Governance

The role of the Board

The Board is ultimately responsible for the risk strategy, having devel-

oped a Risk Governance Framework, which is regularly reviewed and

assessed by the Board, particularly with regards to current and emerg-

ing risks.

The Board believes 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.

The Regulatory & Risk Committee is responsible for reviewing relation-

ships with the regulatory authorities and reviewing the adequacy and

quality of the Group’s systems and procedures for compliance with

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 objec-

tives and reviewing the Group’s risk 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 pro-

cesses operated by management within the day-to-day trading activi-

ties 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.

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

Customer limits are determined with reference to, amongst other

things, a customer’s credit score, trading history, location and other

due diligence results.

Risk Management Framework

A RIGOROUS RISK

FRAMEWORK

42 Plus500 Ltd. 2021 Annual Report

ii. Group limits

Monetary limits are also placed on the Group’s exposure to indi-

vidual 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 CFD trading platform, it automatically ceases to

accept trades from the relevant individual or on the underlying

instrument until such time as exposure levels fall below the relevant

threshold(s) or such 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 offering is available.

Third line of defence

The third line of defence, independent assurance, is provided by inter-

nal audit.

The role of the internal auditor is to examine, among other things, the

Company’s compliance with applicable law and orderly business proce-

dures. 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 inter-

nal auditor’s work plan, monitors its activities and assesses its perfor-

mance. Pursuant to the Companies Law, the internal auditor may be an

employee of the Company but may not be an interested party or office

holder, or a relative of any interested party or office holder and may not

be a member of the Company’s external auditor or its representative.

In January 2022, following receipt of recommendation from the Audit

Committee, the Board appointed E&Y as the Company’s new internal

auditor, replacing Brightman Almagor Zohar & Co. (Deloitte Israel), a

member firm of Deloitte Touche Tohmatsu Limited, which was the

Company’s internal auditor in FY 2021.

Compliance with applicable regulations is also provided by local advi-

sors in the main territories that the Group operates in, and advice on

the regulatory regime is considered when planning new licence applica-

tions 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 mis-

statement 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 devel-

opment 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 hedg

ing 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, accounting

and 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 2019, in accordance with

Provision 28 of the UK Corporate Governance Code 2018 (the “Code”).

This process will again be carried out in FY 2022. Principal risks are

considered those that would threaten its business model, future per-

formance, solvency or liquidity. These are outlined below and further

details of financial risks and their management are set out in note 25

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 con-

solidated into nine principal risks closely monitored by the Board. The

annual and on-going elements of the Group’s risk management pro-

cesses are controlled by an established risk identification, assessment

and monitoring process.

Throughout FY 2021 and up to the date of this 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 circum-

stances, covering all controls, including financial and operational con-

trols and compliance with applicable laws and regulations.

Risk Management Framework continued

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

RISK DESCRIPTION MANAGEMENT AND MITIGATION

BUSINESS AND STRATEGIC RISKS

Legal and

jurisdictional

risk

The risk that changes in the legal and regulatory frame-

works in which the Group currently operates could

adversely affect its performance

– Diversification of jurisdictions in which the Group offers

its services

–

On-going monitoring of legal and regulatory developments

and taking actions to remain in compliance

Regulatory risk Regulatory changes could result in the product offering

becoming less profitable, restrictions on the product

marketing, or a ban on the product offering in one or more

of the countries in which the Group operates

–

On-going monitoring of market and regulatory sentiment,

developments and advice from compliance functions on

actual and possible 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 rela-

tion to compliance with regulations on these issues

–

Continued efforts to educate and inform customers of

the potential risks involved in trading, through required

risk disclosures, educational features and by offering an

unlimited and free demo account

– Negative balance protection has an on-going feature of

the Plus500 CFD 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 with Plus500’s technology

–

Assessment of potential customers prior to and during

the completion of the on-boarding process

FINANCIAL RISKS

Business risk The risk of a commercially adverse impact on the busi-

ness resulting from:

–

The Group’s strategic decision-making failing to seize

business opportunities or react to changes in the mar-

ket. 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 process of strategic developments and initiatives

44 Plus500 Ltd. 2021 Annual Report

RISK DESCRIPTION MANAGEMENT AND MITIGATION

FINANCIAL RISKS CONTINUED

Market risk The risk of exposure to the market.

Market risk is mainly comprised of the following main

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 con-

tractual obligations and/or settlements resulting in finan-

cial loss, specifically:

Client credit risk:

Leveraged trading 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 CFD 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 customers can

only fund their accounts from their own resources, with all

accounts being pre-funded. 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 finan-

cial 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 liquidity regula-

tions 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

Risk Management Framework continued

Governance Financial statementsStrategic report

Plus500 Ltd. 2021 Annual Report

RISK DESCRIPTION MANAGEMENT AND MITIGATION

OPERATIONAL RISKS

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 com-

petent staff which the Group requires for operational

purposes

–

Business and regulatory sign-off of processes and pro-

cedures to ensure business efficiency and regulatory

compliance

– Invest in system development to improve process auto-

mation

– Monitoring, quality checks and robust analysis of perfor-

mance 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

– 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 devel-

oped employee retention programmes, with enhanced

staff training and oversight

–

Additional support through Google Cloud services, provid-

ing 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, unrespon

siveness 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 net-

work 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, scal-

ability, capacity and responsiveness of systems to

monitor, react and prevent cyber attacks

–

Continuous real-time monitoring of incoming and outgo-

ing network activity

–

Constant monitoring of systems performance and con-

trols

–

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 employ-

ees of privacy-related matters including proper use of

personal information, protection of such information

and loss prevention

– Dedicated cyber security training for all global employ-

ees and the Board

–

Robust privacy oriented compliance program to ensure

compliance with applicable data privacy regulations

46 Plus500 Ltd. 2021 Annual Report

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 2024, 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 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

twelve months from the date of approval of the Consolidated Financial

Statements and the consideration of the various risks set out on pages

43 – 45 and the financial risks described in note 25 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 2024.

The Directors confirm that they have performed a robust assessment

of the principal risks facing the Group as detailed on pages 43 – 45

including those that will threaten its business model, future performance

and liquidity.

In reaching this conclusion, both the prospects and viability consid-

erations 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 oper-

ations. 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 collec-

tion 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. 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 2021 and in December 2021 and received final

approval in December 2021.

–

On-going review and monitoring of risks: these are outlined in the

Group’s principal risks and uncertainties on pages 43 – 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 particu-

lar 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 AND

VIABILITY STATEMENT

Going Concern and Viability Statement

47Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Contents

GOVERNANCE

Governance at a Glance 48

Chair's Introduction to Governance 50

UK Corporate Governance Code

Compliance Statement

Board of Directors 52

Governance Report 54

Shareholder Engagement 59

Report of the Nomination

Committee

Report of the Audit Committee 64

Report of the Regulatory & Risk

Committee

Report of the ESG Committee 71

Report of the Remuneration

Committee

Directors’ Remuneration Report 81

Directors’ Report 89

Corporate Law 91

Directors' Responsibility Statement 92

Male

Female

Independent

Directors

Non-independent

Directors

48 Plus500 Ltd. 2021 Annual Report

Board members

as of the date of this Annual Report

Key activities of the Board in 2021

+ Strategic discussion and approval of the acquisitions

of Cunningham and CTS in line with the Company’s

strategy to expand the Group’s geographic footprint

and product offering.

+ Review and approval of on-going trading updates and

results announcements.

+ Conduction of an internal effectiveness evaluation of

the Board and its committees.

+ Monitoring and reviewing the Group’s culture, values

and performance, also through the workforce engage-

ment representative on the Board.

BOARD GENDER DIVERSITY

as of the date of this Annual Report

BOARD INDEPENDENCE

as of the date of this Annual Report

BOARD ATTENDANCE

The Board met on twelve occasions in 2021 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 and other busi-

ness matters.

Governance in numbers

44%

Female Board

members

as of the date of

this Annual Report

Board training

sessions

in FY 2021

Shareholders’

meetings

in FY 2021

Board

committees

Read more about key activities of the Board on page 54

Governance at a Glance

0–3 years

3–6 years 6+ years

49Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

BOARD CHANGES

Three Board members stepped down in 2021 (one Execu-

tive Director and two Independent Non-Executive Directors).

Four Board members were appointed in 2021 and Q1

2022 (all Independent Non-Executive Directors).

BOARD TENURE

as of the date of this Annual Report

BOARD SKILLS AND EXPERIENCE

(Number of Board members with the relevant skills and experience)

Read more on page 56

Newly appointed Directors are made aware of their responsibilities

through the Company Secretary. The Company has accordingly

implemented an internal induction plan for newly appointed Direc-

tors in which it provides the Directors with training sessions via

internal meetings, presentations and conversations with Company

advisors and senior management in order to enable greater aware-

ness and understanding of the Company’s business and the legal

and business environment in which it operates.

Induction of newly appointed Directors

Nomination Committee Report page 60

Finance, banking, ﬁnancial services

and fund management

Audit and risk management

Compliance & Regulation

Shareholder relations

Digital technology

Innovation

ESG

Enterprise Risk management

Capital raising, mergers, acquisitions,

investment and transactions

Marketing

50 Plus500 Ltd. 2021 Annual Report

Dear shareholder

In my first year as Chair of Plus500, I have taken the opportunity to review

and assess all aspects of our business, including our corporate govern-

ance and approach, as well as our activities in the area of sustainability.

I am pleased to say that I have found the Company’s governance frame-

work to be extremely robust, supported by a Board which is well balanced

and diverse, with a strong breadth and depth of knowledge and expertise.

In addition, management continues to place significant emphasis and

focus on ESG matters, particularly around protecting and caring for our

customers and people.

With this background in mind, I would like to take this opportunity to give

you an overview of the work of the Board during 2021. Corporate govern-

ance remained a key focus area for the Board during the year, and this

year we have managed to diversify the composition of the Board sig-

nificantly, in line with the Code and the recommendations of the Hamp-

ton-Alexander Review on gender equality in leadership positions.

In 2021, we continued to dedicate considerable time evaluating the work

of our Board and its committees, and undertook a review of the effective-

ness of the Board. The evaluation process was facilitated internally by

our Company Secretary and myself with the assistance of our external

advisors and included questionnaires which were completed by each

Board member. A detailed report on the results was presented to the

Board in December 2021 and next steps for 2022 were agreed in relation

to the Board and its Committees. In parallel, we have continued to imple-

ment the feedback and insights derived from our 2020 internal Board

evaluation. During 2019 we undertook an independent third party review

by Genius Boards Limited (“Genius Boards”). This was a valuable exercise

which resulted in a number of important recommendations which were

implemented during the course of 2020 and 2021, together with having

the internal reviews in 2020 and 2021. The Board intends to undertake

its next independent third party review during 2022, in accordance with

the recommendation specified in Provision 21 of the Code that FTSE

350 companies shall consider having such an external evaluation once

every three years. The feedback and findings of this independent review

shall be presented in our FY 2022 Annual Report.

As also noted, we were seeking to appoint additional Non-Executive

Directors to complement the Board’s existing skill set and to further

diversify its composition. I am delighted that as announced on 4 Febru-

ary 2021, Ms. Sigalia Heifetz was appointed as an Independent Non-

Executive Director and was re-elected at the AGM held on 4 May 2021.

Furthermore, as approved at our 2021 Extraordinary General Meeting

(“EGM”) held on 16 March 2021, Ms. Tami Gottlieb was appointed as a

Non-Executive Director and External Director. These appointments further

diversify the composition of the Board and have broadened the Board’s

breadth of experience and knowledge.

Also, as announced on 18 March 2022, Prof. Varda Liberman has been

appointed as an Independent Non-Executive Director.

Prof. Liberman is an international renowned expert in the field of decision-

making and behavioural economics. In this capacity, she provides con-

sulting and workshops in key elements of managerial decision-making

and risk management to senior management of organisations across a

range of sectors, including healthcare, banking, investment and technol-

ogy. She is the Rector of Reichman University (IDC Herzliya) in Israel,

and one of its founders and leaders. She is a professor at the business

school, a visiting researcher at Stanford University, and the author of

several books and many scientific articles. During the years, she served

as a Director on several publicly traded corporate boards based in Israel,

including Tamir Fishman trust funds Ltd, and she currently serves as an

External Director at Cellcom Israel Ltd.

I would like to take this opportunity to welcome Varda to our Board, and

I am certain that this appointment will further expand the skills set on

the Board.

I would also like to take the opportunity to thank the two Board members

who stepped down during 2021.

Firstly, following my appointment as a Non-Executive Director (“NED”)

and Chair of the Board at our 2021 AGM held on 4 May 2021, Ms. Penny

Judd stepped down, having been a NED since 2016 and Chair since

2017. I would like to thank Penny for her contribution in leading a con-

tinued improvement in the Company’s governance approach and prac-

tices and I know that her guidance, support and advice were very much

appreciated by our other Board members during her tenure.

Our long serving Senior Independent Non-Executive Director (“SID”) and

External Director, Charles Fairbairn also stepped down at our 2021 AGM.

So, I would also like to thank Charles for his contribution to the develop-

ment of Plus500 since the IPO in 2013, as well as for his wise counsel

and guidance during that time. As previously announced, Ms. Anne Grim

serves as our SID, replacing Charles as of 4 May 2021.

Also, in June 2022 our long serving Independent Non-Executive Director

and External Director, Daniel King, will end his maximum nine-year term

under the provisions of the Companies Law. Daniel is currently the Chair

of both our Remuneration and ESG Committees.

Daniel has been with Plus500 since the IPO and his expertise working

with technology businesses, many of whom are based in Israel, has been

invaluable in helping to navigate the Board and the business through

Plus500 remains focused on its key priorities

in governance and sustainability, supported by

on-going engagement with key stakeholders

within the investment community.

Chair’s Introduction to Governance

51Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

various challenges and to help optimise the many opportunities that

have arisen during his tenure. In addition, his leadership, contribution

and commitment as Chair of the Remuneration and ESG Committees

has been extremely appreciated. We wish Daniel all the best.

As announced on 18 March 2022, Anne Grim shall replace Daniel King

as the Chair of the Remuneration Committee and Steve Baldwin shall

replace Daniel King as the Chair of the ESG Committee. Also, Anne Grim

(being an External Director) shall replace Daniel as the third member of

the Nomination Committee alongside Steve Baldwin and myself, and an

additional member shall be appointed as the third member of the ESG

Committee, alongside Steve Baldwin and Anne Grim.

Executive remuneration remains a significant area of focus for investors

with holdings in companies listed in the UK. We consulted with external

consultants in previous years in order to align remuneration with share-

holders’ expectations. Consequently, in the period ahead of our 2021

AGM, the Remuneration Committee engaged extensively with shareholder

bodies and key shareholders and with the support of an external advisor,

the Group’s Remuneration Policy was restructured, as further detailed

in the Remuneration Committee Report. I am pleased that at our 2021

AGM, shareholders approved the new Remuneration Policy for Directors

and Executives for a three-year term.

During 2021, I met with a number of our major shareholders to introduce

myself as the new Chair of the Board and to ask for feedback on the

Company’s approach to governance, its strategic priorities and its oper-

ational and financial performance. Shareholder engagement is extremely

important and I will continue to meet regularly with key investors, as will

the rest of the Board members, to ensure we represent investors’ interests.

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. The Committee will also continue

to review the size of the Board to confirm that it is appropriate with 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 2021, significant effort by the Nomination

Committee ensured a further diversification of the composition of the

Board, with the appointments of two female Non-Executive Directors, as

mentioned earlier. These efforts have continued in 2022, with the recent

appointment of an additional female Non-Executive Director.

Our oversight of the significant risks including regulatory, financial and

technology challenges facing the Group continues. The Regulatory &

Risk Committee, led by its new chair, Sigalia Heifetz, reviews these risks

and receives assurance from management and the Group’s advisors as

to how they are understood and mitigated to the level of risk acceptable

to the Board.

The Audit Committee, led by its new Chair, Tami Gottlieb, continues its

work overseeing the internal controls of the business, the internal audit

plan and its implementation and approvals of certain transactions as

required under the Companies Law. It also works closely with our exter-

nal auditors and oversees the production of the Consolidated Financial

Statements.

Also, in 2021 we have continued to develop and strengthen our ESG

Committee which was established at the end of 2020, to assess the

Group’s impacts and interactions with ESG aspects. Chaired by Daniel

King, the ESG Committee was supported by external advisors and con-

ducted an ESG materiality assessment, according to which the Group

has already begun to develop its ESG roadmap for the coming years.

Also, the Committee has developed a new Environmental Policy, sup-

ported by an extensive gap analysis, to help us to become aligned with

the Task Force on Climate-Related Financial Disclosures (“TCFD”) recom-

mendations as detailed in our ESG report and in the Report of the ESG

Committee.

The following Governance Report describes the activities of the Board

and its committees during 2021 in more detail.

The Board has operated very efficiently during 2021, despite the impact

of the pandemic which has meant that all Board meetings were held as

hybrid sessions (which is a mixture of in-person and virtual attendance).

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 review-

ing 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

organic investments and 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 and geographic footprint. This

is evident by the progress made in 2021, with the US acquisitions and

the introduction of our new share dealing platform, ‘Plus500 Invest’.

Finally, and importantly, I would like to say some words of deep gratitude,

both personally and on behalf of the Board, to all of our management

and talented employees across our offices worldwide, for their hard work,

dedication and fantastic contribution to the Group’s culture, performance

and achievements during the year, especially in the context of a chal-

lenging pandemic-driven environment.

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

UK Corporate Governance Code

Compliance Statement

As a Main Market listed company, following its admission to the Main

Market of the London Stock Exchange, and with respect to 2021,

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 2021 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 de-

tailed descriptions are available.

For the financial year ended 31 December 2021, 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 rela-

tion to pay ratios and pay gaps (Provision 41 of the Code). While the

Code recommends the submission of all directors for re-election an-

nually, as a company registered in Israel, it is subject to mandatory

corporate governance requirements under the Companies Law, which

require that the Company must always have at least two External Direc-

tors who meet certain statutory requirements of independence. The

Company’s External Directors are Daniel King (until June 2022), Anne

Grim and Tami Gottlieb. The External Directors must meet certain

statutory requirements of independence and, 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 Companies Law whereas companies incorporated in the

United Kingdom are required to do so under UK legislation.

52 Plus500 Ltd. 2021 Annual Report

PROF. JACOB A. FRENKEL

Chair

Tenure: 10 months (Appointed May 2021)

Prof. Jacob A. Frenkel is a Non-Executive Director and

Chair of the Board of Directors.

Prof. Frenkel is a renowned global economist and

illustrious business leader, with significant experience

developed over many years of leadership. He is cur-

rently Chair of the Cabinet of Economic Experts of the

Minister of Finance of the State of Israel, Chair of the

Board of Trustees of the Group of Thirty (G-30), and

Chair 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), Vice Chairman of American Inter-

national Group, Inc. (2004-2009) and, Chairman of

Merrill Lynch International (2000-2004). 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 Counsel-

lor and Director of Research at the International Mon-

etary Fund (1987-1991) having previously been a Chaired

Professor of Economics at the University of Chicago.

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 holds a range

of fellowships and advisory positions. He is a Honor-

ary 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 and a member of the G20 High Level Inde-

pendent 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.

DAVID ZRUIA

Chief Executive Officer and Director

Tenure: 2 years (Appointed April 2020)

David Zruia is the Chief Executive Officer.

David joined the Group in 2010 as a senior manager

in the marketing department. In that role, David was

instrumental in establishing the Group’s marketing

capabilities and in building awareness of, and recogni-

tion for, the Plus500 brand in key markets around the

world. He was appointed as the Group COO in 2013

and led the establishment and management of the

operational division of the Group, including KYC pro-

cesses, payment processing, back office, customer

service and risk management.

David holds a B.Sc. in Industrial Engineering and Man-

agement from the Technion – Israel Institute of Tech-

nology.

ELAD EVEN-CHEN

Group Chief Financial Officer and Director

Tenure: 6 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 is also responsible for Plus500’s strategic busi-

ness development projects, including targeting and

executing acquisitions. He has therefore played a key

role in driving the Group’s strategic and financial per-

formance and its business expansion in recent years,

into new markets and new product areas.

Elad has an extensive corporate finance, legal and

regulatory background. Over the last 11 years he has

held a number of positions within the Group also acting

as the Company Secretary, Head of Risk and Head ofIR.

Elad is a certified accountant in Israel and, prior to

joining the Group, he was a senior associate at KPMG.

Elad holds a BA in Accounting and Economics from

Tel-Aviv University, an LL.B Degree from the College

of Management and an MBA (specialising in Financial

Management) from Tel-Aviv University.

ANNE GRIM

Senior Independent Non-Executive Director and

External Director

Tenure: 1.5 years (Appointed September 2020)

Anne Grim is a Non-Executive Director and the Senior

Independent Director.

Upon Daniel King’s tenure finishing in June 2022, Anne

will chair the Remuneration Committee.

Anne is an experienced executive turned advisor, con

sultant and Board Director with more than 30 years

in senior financial services leadership roles at Barclays,

Wells Fargo, American Express, Mastercard and most

recently (and formerly) as Chief Customer Officer at

Fidelity International. Her expertise is in customer

experience, strategic planning and execution, technol-

ogy innovation and business transformation.

Anne was an independent non-executive Board mem-

ber for RateSetter (up until 31 December 2021 when

RateSetter was acquired by Metro Bank PLC) and is

currently an independent non-executive Board mem-

ber for Insight Investment, Metro Bank PLC and Open-

work Holdings Ltd.

Anne is also an Advisor to the Investment Association’s

FinTech Engine and a Trustee on the UK board of

Opportunity International.

Anne holds a Bachelor’s degree in Mathematics and

Computer Science and a Master’s of Business Admin-

istration in Strategic Management and Finance, both

from the University of Illinois.

DAVID ZRUIA

ANNE GRIM

The role of the Board

The Board is responsible to shareholders for effective direction

and control of the Company and to promote the long-term suc-

cess of the Company, and determining the Group’s strategy,

vision and culture. In order to lead the development of the strat-

egy of the Company and the progress of financial performance,

the Board is provided with timely and comprehensive informa-

tion that enables it to effectively review and monitor the perfor-

mance of the Company and to ensure it is in line with its

objectives for achieving its strategic goals.

PROF. JACOB A. FRENKEL

ELAD EVEN-CHEN

(Chair)

Board of Directors

As at the date of this Annual Report

53Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Committee membership Key:

Nomination

Audit

Regulatory & Risk

Remuneration

ESG

Disclosure

Changes to the Board during 2021 (and until the date of this Annual Report)

+ Gal Haber stepped down from the Board on 4 January 2021.

+ Sigalia Heifetz joined the Board on 4 February 2021.

+ Tami Gottlieb joined the Board on 16 March 2021.

+ Jacob A. Frenkel joined the Board on 4 May 2021.

+ Penny Judd stepped down from the Board on 4 May 2021.

+ Charles Fairbairn stepped down from the Board on 4 May 2021.

+ Varda Liberman joined the Board on 18 March 2022.

STEVE BALDWIN

Independent Non-Executive Director

Tenure: 5 years (Appointed June 2017)

Steve Baldwin is a Non-Executive Director and Chair

of the Nomination Committee.

Upon Daniel King’s tenure finishing in June 2022,

Steve will also chair the ESG Committee.

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 Euro-

pean Equity Capital Markets and Corporate Broking

at Macquarie Capital until 2015 when he decided to

pursue a non-executive career. Prior to joining Mac-

quarie 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.

TAMI GOTTLIEB

Independent Non-Executive Director and External

Director

Tenure: 1 year (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 Ltd. – 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 & Strategy

Committees, having previously been on the Technol-

ogy Committee and on the Risk Management Commit-

tee. Tami Gottlieb is also a Chair at Shefayim Holdings

Corporation, an External Director at Extell Limited and

a Director at Emilia Development. She is also a founder

and Managing Director of Harvest Capital Markets Ltd,

a wealth management and corporate finance boutique.

Tami holds a Bachelor’s Degree in International Relations

from the Hebrew University of Jerusalem and a Master’s

Degree in Economics from Indiana University.

DANIEL KING

Independent Non-Executive Director and External

Director

Tenure: 9 years (Appointed June 2013)

Daniel King is a Non-Executive Director and Chair of the

Remuneration and ESG Committees (until June 2022).

Daniel has spent the last two decades in executive and

senior management roles within technology corporates

as well as start-ups as an operator, advisor and inves-

tor with a focus on Fintech, eCommerce technology,

Big Data, BI, Analytics, SaaS platforms, and Market-

places for both B2B and B2C. He has extensive knowl-

edge in investing, fundraising, and scaling high-growth

companies including international expansion.

Daniel is currently a Venture Partner with Seedcamp,

one of Europe’s largest Venture Capital firms for early

stage funding. He is also Chair of StitcherAds a plat-

form for social commerce. Previously, he was President

& COO for Profitero, a SaaS provider of online insights

and e-commerce intelligence for retailers and brands

and prior to that was a specialist consultant to the UK

Government working for the Department of Investment

and Trade (DIT) as Head of High Growth & Emerging

Markets.

Daniel was previously Managing Partner of Blue Leaf

Capital, a private boutique venture capital and advi-

sory services company based in London and has held

managing director roles with Compete Inc, MySuper-

market.co.uk, and Experian Hitwise, overseeing its

EMEA operations and was a key member of staff that

led to the eventual acquisition of Hitwise by Experian

in June 2007.

Daniel holds a Bachelor’s Degree (hons) in Finance

and Accounting from Manchester University.

SIGALIA HEIFETZ

Independent Non-Executive Director

Tenure: 1 year (Appointed February 2021)

Sigalia Heifetz is a Non-Executive Director and Chair

of the Regulatory & Risk Committee.

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 & Develop-

ment Ltd and Vesta Investment & Management. 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.

Sigalia holds a Bachelor’s Degree in Accounting and

Economics from Tel Aviv University and an Executive

MBA from INSEAD and Tsinghua University.

PROF. VARDA LIBERMAN

Independent Non-Executive Director

Tenure: Appointed March 2022

Prof. Varda Liberman is a Non-Executive Director.

Prof. Liberman is an international renowned expert in

the field of decision-making and behavioural econom-

ics. In this capacity, she provides consulting and work-

shops in key elements of managerial decision-making

and risk management to senior managements of

organisations across a range of sectors, including

healthcare, banking, investment, technology, the judi-

cial 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 at the business school, 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, lead-

ing 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 Sta-

tistics, an M.Sc. in Mathematics and a Ph.D. in Math-

ematics, all from Tel Aviv University.

STEVE BALDWIN

(Chair)

TAMI GOTTLIEB

(Chair)

SIGALIA HEIFETZ

(Chair)

PROF. VARDA LIBERMAN

DANIEL KING

N A

(Chair)

54 Plus500 Ltd. 2021 Annual Report

Governance Report

The Board

The Board maintains full control and direction over appropriate strate-

gic, financial, organisational and compliance issues. The Company’s

organisational structure has clearly defined lines of authority, respon-

sibility and accountability, which are reviewed regularly. The annual

budget and forecasts are reviewed by the Board prior to approval being

given. 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 consid-

eration at Board meetings are business strategy, operational highlights

and current trading, quarterly forecasts, budget and financial performance,

governance, organisational culture and risk & regulation, as further

detailed at 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 2021

Strategy –

A comprehensive strategy discussion was held in

December 2020, with support from a well-known glob-

al strategic advisory firm, at which a new vision and

strategy was discussed and agreed, in the context of a

detailed discussion about the competitive environment

and potential growth opportunities for the Group.

– During 2021 the Board discussed actions to deliver on

the strategy for the coming years, as set out on pages

20 – 21.

– The Board held strategic discussion, and approved the

acquisitions of Cunningham and CTS in line with the

Company’s strategy to evolve into a multi-asset fintech

group and expand the Group’s geographic footprint.

Business,

operational

highlights and

current trading

The Board received monthly updates including CEO

reviews, financial performance updates, business develop-

ment updates and risk and regulatory compliance reports.

Quarterly

forecasts and

budget

Updates were provided and discussed on a monthly and

quarterly basis. Discussions on the 2022 budget were

held in October 2021 and in December 2021 and it received

final approval in December 2021.

Financial

performance

The Board reviewed and approved the on-going trading

updates and results announcements. The Board consid-

ered and approved dividend distributions and share buy-

backs, 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 regulatory changes and

updates, in addition to on-going updates on compliance

matters.

Whistleblowing

The Board reviewed and approved the Group’s Whistle-

blowing Policy, as it does on an annual basis, and received

an update by the Whistleblowing Supervisor that no com-

plaints were received in 2021.

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 manag-

ment 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, as well as with

certain employees of the Group’s subsidiaries.

Shareholder

returns

The Board declared the payment of dividends and adopt-

ed share buyback programmes during the year, in line with

the Group’s shareholder returns policy.

Other –

An internal effectiveness evaluation of the Board and

its committees has been conducted;

–

Review of monthly reporting decks on Risk and Compli-

ance;

–

Receiving on-going updates from Board committees’

chairs;

–

Board trainings on various topics, including: ESG, Cyber

security, the UK Market Abuse Regulation, Israeli & UK

Corporate Law;

–

Annual review and approval of Human Rights and Mod-

ern Slavery Statement; and

– Annual review and approval of Company’s policies and

procedures.

55Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

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 refer-

ence 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’s 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 60 – 63.

Audit Committee

The Audit Committee has been delegated responsibility for ensur-

ing 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 Commit-

tee’s responsibilities, main activities and priorities for the next

reporting cycle are set out on pages 64 – 68.

Regulatory & Risk Committee

The Regulatory & Risk Committee has been delegated respon-

sibility 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 report-

ing cycle are set out on pages 69 – 70.

Environmental, Social and Governance Committee

The ESG Committee has been delegated responsibility for con-

sidering 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 71 – 73.

Remuneration Committee

The Remuneration Committee has been delegated responsibil-

ity 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 respon-

sibilities, main activities and priorities for the next reporting cycle

are set out on pages 74 – 80.

Disclosure Committee

The Disclosure Committee assists the Board in fulfilling its obli-

gation 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 Reg-

ulations and the Disclosure Guidance and Transparency Rules

of the FCA, including the requirement for the Company to estab-

lish and maintain adequate procedures, systems and controls

to enable it to comply with these obligations. Whenever neces-

sary, the Committee meets to discuss the content of announce-

ments proposed to be released to the London Stock Exchange

and approve their content, where relevant.

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 finan-

cial 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 aims and 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 or any subsidiary 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 committee chairs

in setting agendas for meetings of the Board and its committees and

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 after years of

experience in corporate and securities law, being an associate with one

of the leading law firms in Israel. Hila holds an LL.B, BA in Social science

and an Executive MBA, all from the University of Haifa. All Directors

have access to the advice and services of the Company Secretary, who

56 Plus500 Ltd. 2021 Annual Report

is responsible to the Board for ensuring that Board procedures are

complied with. Both the appointment and removal of the Company

Secretary is a matter for the Board as a whole.

Board effectiveness

The Board holds its meetings in accordance with its scheduled calen-

dar. Each Board meeting is preceded by a clear agenda and any relevant

information is provided to the Directors in advance of the meeting. The

Board met on twelve occasions in 2021 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 and other

business matters. A summary of the key activities of the Board in 2021

is set out on page 54.

Where Directors 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 Directors in the furtherance of their duties to take independ-

ent professional advice.

Induction of newly appointed Directors

Newly appointed Directors are made aware of their responsibilities

through the Company Secretary. The Company has accordingly imple-

mented an internal induction plan for newly appointed Directors in

which it provides the Directors with training sessions via internal meet-

ings, presentations and conversations which are conducted by Company

advisors (such as legal advisors), the senior management and other

relevant persons in order to enable greater awareness and understand-

ing 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 lead-

ing 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 Executives, 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 com-

munication 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 management and managing the financial reporting of the Group.

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, technology and other finan

cial 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 Directors.

The Senior Independent Director may also take responsibility for an

orderly succession process for the Chair, working closely with the

Nomination Committee. The Senior Independent Director also serves

on several Board committees and is available to shareholders if they

have concerns that contact through the normal channels of Chair, Chief

Executive or other Executive Directors has failed to resolve or for which

such contact is inappropriate.

Board composition

As of the date of this Annual Report, the Board comprises two Execu-

tive Directors (who constitute 22% of the Board): David Zruia and Elad

Even-Chen, and seven Non-Executive Directors (who constitute 78% of

the Board): Prof. Jacob A. Frenkel (Chair of the Board), Anne Grim

(Senior Non-Executive Director), Daniel King, Steve Baldwin, Sigalia

Heifetz, Tami Gottlieb and Prof. Varda Liberman. Prof. Frenkel was

independent on appointment, in accordance with the requirements of

the Code. As a Senior Independent Director, Anne Grim is available to

meet with shareholders if they have concerns which are not being

addressed through the usual channels of the Chair, the Chief Executive

Officer or the Chief Financial Officer.

In accordance with the Companies Law, the Board must always have

at least two external directors who meet certain statutory requirements

of independence (the “External Directors”). The Company’s External

Directors are Daniel King, 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. Mr. King’s nine years

tenure ends in June 2022, after which the Board will have two External

Directors – Anne Grim and Tami Gottlieb and will therefore, be fully

aligned with the provisions of the Companies Law. In addition to the

above, any committee of the Board must include at least one External

Director and the Audit Committee and Remuneration Committee must

each include all of the External Directors (including one External Direc-

tor serving as the chair of the Audit Committee and Remuneration

Committee), and a majority of the members of each of the Audit and

Remuneration Committees must comply with the Director independ-

ence requirements.

Governance Report continued

57Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Board composition and attendance in FY 2021

SCHEDULED MEETINGS

ELIGIBLE TO ATTEND

SCHEDULED MEETINGS

ATTENDED

Chair of the Board

Prof. Jacob A. Frenkel

6 6 (100%)

Executive Directors

David Zruia 12 12 (100%)

Elad Even-Chen 12 12 (100%)

Senior Independent Non-Executive, External Director

Anne Grim 12 12 (100%)

Independent Non-Executive, External Director

Daniel King 12 12 (100%)

Tami Gottlieb

10 9 (90%)

Independent Non-Executive Director

Steve Baldwin 12 12 (100%)

Sigalia Heifetz

11 11 (100%)

Past Directors

Gal Haber

0 0

Penny Judd

6 6 (100%)

Charles Fairbairn

6 6 (100%)

1. Prof. Jacob A. Frenkel was appointed on 4 May 2021.

2. Tami Gottlieb was appointed on 16 March 2021.

3. Sigalia Heifetz was appointed on 4 February 2021.

4. Gal Haber stepped down from the Board on 4 January 2021, prior to any scheduled meeting of the Board.

5. Penny Judd stepped down from the Board at the 2021 AGM held on 4 May.

6. Charles Fairbairn stepped down from the Board at the 2021 AGM held on 4 May.

7. Tami Gottlieb was unable to attend one Board meeting due to illness.

General note: Prof. Varda Liberman was appointed as a Board member in March 2022, thus she is not included in the Board’s attendance table in FY 2021.

Conflicts of interest

The Company has procedures for the disclosure and review of any

conflicts of interest, or potential conflicts of interest, which the Directors

may have. The Board members are asked to disclose any conflicts of

interest at each scheduled Board meeting. Each Director is aware of

their responsibility to avoid conflicts of interest and to disclose any

conflict or potential conflict of interest to the Board. A Director 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 Com-

mittee 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.

Election of Directors

Following recommendations from the Nomination Committee and a

review by the Chair of the Board, the Board considers that all Directors

continue to be effective, remain committed to their roles and have

sufficient time available to perform their duties. Information with respect

to Directors’ re-election will be set out in the 2022 Notice of AGM.

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 busi-

ness 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

without the Chair’s presence, in order to, among others, evaluate his

performance. As of FY 2022, such discussions are intended to be sched-

uled at least twice a year.

Each Director 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.

58 Plus500 Ltd. 2021 Annual Report

Board evaluation

Provision 21 of the Code recommends that FTSE 350 companies

consider having an external evaluation once every three years. The

previous externally facilitated Board evaluation was carried out in 2019

with the feedback report presented by Genius Boards.

The evaluation covered attending several Board meetings and Com-

mittee meetings, interviewing the Board, the Company Secretary and

several executives and relevant advisors to the Company.

The Company expects to have its next externally facilitated Board

evaluation in 2022.

During the year, the Board also conducted an internal Board effective-

ness evaluation, led by the Chair and the Company Secretary with the

support of the Company’s external advisors. The Board members were

requested to complete questionnaires and to evaluate the performance

of the Board and its committees during 2021, as well as the performance

of the Chair and their own performance as Board members. The ques-

tionnaires were developed by the Chair and the Company Secretary,

taking into consideration the findings of the 2020 internal evaluation

and also the Financial Reporting Council’s Guidance on Board Effective

ness, and were circulated to all Board members and each Committee

member for completion.

The Company Secretary discussed the feedback received from the

completed questionnaires with the Chair, the Senior Independent Direc-

tor and each committee chair. A final report on the feedback, comments

and suggestions received was circulated to the Board and its Commit-

tees, and was presented by the Company Secretary and discussed by

the Board at its meeting held in December 2021.

The findings determined, among other things, that the Board has made

good progress from FY 2020 in relation to:

– Remuneration matters, including an approval of a new Remuneration

Policy for Directors and Executives;

– Time management at the Board and Committee meetings;

– Process for attracting and selecting new Directors;

– Board composition – gender and fields of experience and expertise;

– Progressing well in the ESG journey;

–

Management information is freely available to the relevant parties,

with better content and format of the management reports contained

in the Board packs;

– Good regulatory, risk and business knowledge on the Board; and

– Timeliness of succession planning.

Opportunities for improved effectiveness were also identified, and the

Board, supported by the Company Secretary, will apply themselves

delivering the agreed actions arising from the internal review in 2022.

Board training and development

On a regular basis, all Board members are given updates on changes

and developments in the business and the environment in which the

Group operates, in order to further develop the understanding and

awareness of the Board.

The Company Secretary and the legal advisors provide updates to the

Board on any relevant legislative and regulatory corporate governance-

related changes on an on-going basis.

During the year the Directors attended training on various areas includ-

ing ESG, cyber security, the UK Market Abuse Regulation and Israeli &

UK Corporate Law.

Ensuring that the Annual Report is fair, balanced and understand-

able

In relation to the Annual Report and the Consolidated Financial State-

ments for the year ended 31 December 2021, 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.

The Company encourages the engagement of both institutional and

private investors. During 2021, in light of COVID-19 restrictions and

related public health guidance by various governments, the majority

of investor meetings were conducted by the Company 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 invest-

ment 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 Chair of the Audit, Remuneration, Nom-

ination, 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 its website (www.plus500.com), which includes copies of

the Company’s regulatory news, financial statements, investor pres-

entations and other reports.

Regular updates are provided to the Board on meetings with sharehold-

ers and analysts, as well as on brokers’ opinions. Non-Executive Direc-

tors are available to meet major shareholders, as required. Investors

are also encouraged to contact the Company’s Head of Investor Rela-

tions at: ir@Plus500.com.

Governance Report continued

59Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Major interests in shares

As at 21 March 2022, being the latest practicable date before the

approval of this report, the Company is aware of the following persons

who, directly or indirectly, were interested in 3% or more of the Com-

pany’s capital or voting rights:

FUND MANAGER

NUMBER

SHARES %

Odey Asset Management 9,057,360 9.09

Schroder Investment Management 5,289,085 5.31

The Vanguard Group, Inc 4,419,730 4.44

BlackRock Inc 4,273,471 4.29

2021 Annual General Meeting

The 2021 Annual General Meeting was held on 4 May 2021 as a virtual

meeting, due to the UK government restrictions following the COVID-19

pandemic.

All resolutions proposed at the 2021 AGM were duly passed by share-

holders by means of a poll vote.

Following consultations made with shareholders ahead of the 2021

AGM, the Remuneration Committee excluded special, one-off bonuses

in future Executive Remuneration plans in the Company’s new Remu-

neration Policy. A resolution to approve the new Remuneration Policy

was approved by over 94% of shareholders’ votes at the AGM.

The Board noted that two resolutions passed at the 2021 AGM had

more than 20% of votes cast against them. These resolutions related

to an advisory vote on the Directors’ Remuneration Report and a tax-

related bonus payment regarding the Company obtaining a highly

beneficial approval from the Israeli Tax Authority and the Israel Innova-

tion Authority as a Preferred Technological Enterprise. Since the AGM

results, the Board have engaged with various shareholder advisory

bodies and a number of shareholders, taking into account their feedback.

The Board always takes the outcome of shareholders’ votes seriously

and, going forward, will continue its engagement and dialogue with

shareholders and their representatives and will continue to consider

related shareholders’ feedback, with a view to implementing the feed-

back, as appropriate.

2022 Annual General Meeting

Given many of the Company’s Board members are based in international

locations, and with travel restrictions remaining in place in certain

geographies, in order to facilitate an effective participation by the

shareholders from various jurisdictions, the Company’s 2022 Annual

General Meeting will be held as a hybrid meeting. Going forward, sub-

ject to future changes to travel restrictions, it is expected that the

Company’s AGMs will be held on a physical or hybrid basis.

Details of all resolutions to be proposed at the 2022 Annual General

Meeting will be included in the Notice of the 2022 Annual General

Meeting to be circulated by the Company to all shareholders in due

course.

Shareholder Engagement

60 Plus500 Ltd. 2021 Annual Report

“With several significant appointments

made in 2021, including of Prof. Jacob

A. Frenkel as the Board’s new Chair,

substantial progress was made in ex-

panding the range of the Board’s ex-

pertise and further diversifying its

composition.”

Steve Baldwin, Chair of the Nomination Committee

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

2021.

The Board is committed to evaluating and reviewing the structure, size

and composition of the Board on a continual basis, including the bal-

ance of skills, knowledge, experience and diversity (including gender

diversity) of the Board while factoring in the Company’s strategy, risk

appetite and future development.

During the year, the Committee undertook a review of the broader

composition of the Board, and identified a need to add further Independ-

ent Non-Executive Directors to increase the Board‘s talent diversity.

Subsequently, an external headhunter, True Europe LLP (“True Search”)

was engaged to support the process and to identify potential candidates

with the required skills, experience and diversity credentials.

The Committee engaged the services of True Search and candidate

briefs were compiled and lists of appropriate candidates for each brief

were drawn up with input from the Board and its advisors. Other than

in respect of recruitment services, True Search has no other connection

with the Company or any of its Directors.

I am pleased that in 2021 we welcomed to the Board two female Direc-

tors, Ms. Sigalia Heifetz, who was appointed in February 2021 as an

Independent Non-Executive Director (and was re-elected at our 2021

AGM), and Ms. Tami Gottlieb, whose nomination for appointment as

an Independent Non-Executive Director and External Director was

approved by our shareholders at our 2021 EGM held in March 2021.

Tami was also appointed as the Chair of the Audit Committee following

the departure of Charles Fairbairn.

Also, during 2021 the Committee led the search for a new Chair of the

Board to succeed Penny Judd, who served as a Non-Executive Director

since 2016 and as our Chair since 2017. True Search was engaged

again to support the process and to identify potential candidates with

the required skills, background experience and expertise. After a thor-

ough and transparent process, Prof. Jacob A. Frenkel was identified

as the best suited candidate and I am pleased that his appointment

was approved by the Company’s shareholders at our 2021 AGM held

on 4 May 2021, with excellent support from 99.83% of those voting.

The Committee also identified a need to add an additional Independent

Non-Executive Director in 2022 to increase the Board‘s talent diversity

and was also mindful that Daniel King, our long serving Independent

Non-Executive Director and External Director had served since the

Company’s IPO in 2013 and would not be 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.

The new Board members have gone through an extensive induction

process, as further described on page 56 above.

The Board is committed to diversity of gender, ethnicity, background,

nationality and professional experience and these were the key pillars

of the searches. Hence, I am delighted that our Board composition was

significantly diversified during FY 2021 by the addition of three Inde-

pendent Non-Executive Directors – Ms. Sigalia Heifetz, Ms. Tami Got-

tlieb and Prof. Jacob A. Frenkel, as the Chair of the Board, and also very

recently with the appointment of Prof. Varda Liberman as an additional

Independent Non-Executive Director.

Report of the Nomination Committee

61Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

These appointments have increased the gender diversity on the Board,

and have ensured that the Company increases its talent diversity, in

line with the Code and the recommendations of the Hampton-Alexan-

der Review on gender equality in leadership positions. Following these

additional appointments, I am pleased to report that, as of the date of

this Annual Report, the Board comprises 44% female Directors (four

female Directors out of nine Directors). Also, following Daniel King’s

tenure finishing in June 2022, the Board will comprise 50% female

Directors (four female Directors out of eight Directors).

I would like to thank Daniel for all his help during his time on the Com-

mittee.

During the year, the Committee recommended to the Board that a new

Senior Independent Director be appointed to replace Charles Fairbairn

who was stepping down as the Senior Independent Director at the 2021

AGM held in May 2021. The Committee took into consideration the

recommendations of the final Hampton-Alexander Report published in

February 2021, which recommended that as a matter of best practice

companies should have a woman in at least one of the four roles of Chair,

CEO, SID and CFO. I am pleased that Ms. Anne Grim was appointed as

our new SID, as of May 2021. Further details of Anne’s qualifications can

be found on page 52.

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 Directors.

Due to the enhanced role of the Nomination Committee set out in the

Code, we are continuing to develop our programme of activity accord-

ingly. Throughout 2021, 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.

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 the next year’s Annual Report.

Steve Baldwin

Chair of the Nomination Committee

22 March 2022

Committee composition

The Nomination Committee comprises Steve Baldwin, Daniel

King and Prof. Jacob A. Frenkel, and is chaired by Steve Baldwin.

The Code recommends that a majority of the members of a

nomination committee should be Independent Non-Executive

Directors. The Board considers Steve Baldwin, Daniel King and

Jacob Frenkel to be independent for the purposes of the Code.

Upon Daniel King’s tenure finishing in June 2022, Anne Grim,

the Senior Independent Director and External Director, shall

replace Daniel King as a member of the Nomination Committee.

Details of the skills and experience of the Committee members

are set out on pages 52 – 53 of this Annual Report. Details of

individual attendance at meetings are set out in the Committee

attendance table below.

Committee attendance (in FY 2021)

SCHEDULED

MEETINGS

ELIGIBLE TO

ATTEND

SCHEDULED

MEETINGS

ATTENDED

Steve Baldwin (Chair) 3 3 (100%)

Daniel King 3 3 (100%)

Prof. Jacob A. Frenkel

2 2 (100%)

Past members

Gal Haber

0 0

Charles Fairbairn

0 0

1. Prof. Jacob A. Frenkel was appointed as a member of the Committee on

12 May 2021.

2. Gal Haber stepped down from the Committee (and from the Board) on

4 January 2021, prior to any scheduled meeting of the Committee.

3. Charles Fairbairn stepped down from the Committee on 3 February 2021,

prior to any scheduled meeting of the Committee.

62 Plus500 Ltd. 2021 Annual Report

Committee responsibilities and activities

The Nomination Committee has responsibility for reviewing the struc-

ture, size and composition (including the skills, knowledge and experi-

ence) 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 Directors and other senior execu-

tives, 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 Director 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 Commit-

tees 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

2021 is set out below:

Board

composition &

Time commit-

ment

– Re-election of Directors;

– Review of core skills and experience of the Board and

the independence of the Non-Executive Directors;

– Review of membership of committees;

–

Appointment of three Independent Non-Executive Direc-

tors (including a new Chair of the Board);

– Appointment of a new Senior Independent Director;

–

Appointment of new Chairs of the Audit Committee and

the Regulatory & Risk Committee; and

–

Review of time commitment of the Non-Executive Direc-

tors.

Succession

planning

– Review tenure of the Directors;

– Review of the Company’s written succession plan; and

–

Foster the development of talented employees through-

out the business.

Diversity –

Review and amend the Equality, Diversity and Inclusion

Policy, in line with the Code and the 33% target for female

board representation set out in the Hampton-Alexander

Review; and

–

Review of Board diversity on the Board, and signifi-

cantly increased the female representation on the Board.

2021 internal

Committee

evaluation

–

Discussion and assessment of the 2020 and 2021

internal Nomination Committee evaluation findings.

Governance – Review of the Committee’s terms of reference in light

of the Code and the Companies Law; and

– Review of 2021 Nomination Committee Report which

is included within this Annual Report.

Following the activities of the Committee in 2021, the Committee is

confident that each Director 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 Director’s contribution is important

to the Company’s long-term sustainable success.

Priorities for FY 2022

In the coming year the Committee will continue to focus on key themes

such as diversity and succession planning and ensuring a diverse tal-

ent pipeline throughout the Group.

Equality, Diversity and Inclusion

The Board’s policy on equality, diversity and inclusion commits to:

– Ensuring the selection and appointment process for employees and

Directors includes a diverse range of candidates;

–

Ensuring that no unlawful discrimination occurs at any stage in the

selection process on the grounds of age, disability, gender reassign-

ment, marriage and civil partnership, maternity, pregnancy, race, religion

or belief, gender or sexual orientation, ethnicity, country of origin,

nationality and cultural background;

–

Disclosing statistics on gender diversity in this Annual Report (page 33);

and

– Reviewing the policy from time to time 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 Company’s Equality, Diversity

and Inclusion Policy.

Board Equality, Diversity and Inclusion Policy

OBJECTIVES PROGRESS UPDATE

Ensuring the selection and appoint

ment process for employees and

Directors includes a diverse range

of candidates

Review employees’ recruitment proce-

dure which includes, among others, a

non-discriminatory selection process,

allowing the recruitment of a diverse

workforce.

Ensuring that no unlawful discrimi-

nation occurs at any stage in the

selection process on the grounds

of age, disability, gender reassign-

ment, marriage and civil partnership,

maternity, pregnancy, race, religion

or belief, gender or sexual orienta-

tion, ethnicity, country of origin,

nationality and cultural background

Review employees’ recruitment proce-

dures which include non-discriminato-

ry selection process, at all stages of

the selection process.

Improve gender diversity at Board

and senior management level

One female Non-Executive Director was

appointed in September 2020 and two

additional female Non-Executive Direc-

tors were appointed in Q1 2021, follow-

ing the engagement with True Search.

Also, an additional female Non-Execu

tive Director was appointed in March

2022.

Review Board equality, diversity

& inclusion policy

The Committee has reviewed and

approved the updated Board’s equality,

diversity & inclusion policy, a copy of

which is available on the Company’s

website.

Report of the Nomination Committee

continued

63Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Succession planning

The Committee has spent time in 2021 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 develop-

ing 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 inter-

nal successors for all roles throughout the business. Nevertheless, the

Committee has reviewed plans for the succession of senior manage-

ment roles throughout the business and has identified appropriate

candidates as potential successors (both immediate successors and

long-term successors).

Relevant skills and experience on the Board

JACOB A.

FRENKEL

DAVID

ZRUIA

ELAD

EVEN-CHEN

DANIEL

KING

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 manage-

ment

NED ED NED NED NED NED NED

Capital raising, mergers,

acquisitions, investment and

transactions

NED ED NED NED NED

Marketing

ED NED NED NED

Compliance & Regulation

NED ED ED NED NED NED NED

Shareholder relations

NED ED ED NED

Digital technology

ED NED 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

Executive Director

NED

Non-Executive Director

64 Plus500 Ltd. 2021 Annual Report

Dear shareholder

I am honoured to have been appointed as the new chair of the Audit

Committee of the Board in May 2021. The 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. I would like to thank Charles Fairbairn, my predecessor, for

his efforts in establishing this solid foundation on which to manage

the Committee.

With that in mind, I am pleased to take this opportunity to give you an

overview of the work of the Committee during 2021. The Audit Com-

mittee 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.

With the assistance of Deloitte, our internal auditor during FY 2021, we

reviewed and monitored a multi-year internal audit plan which we will

continue to review and update over time. 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

our interest to replace Deloitte as our internal auditor. As a result, and

after due process, we appointed E&Y as our new internal auditors, as

of FY 2022.

The Committee also reviewed a list of non-audit services provided this

year by the Company’s external auditor and approved its audit plan for

2022.

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 2022

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 key governance mandates pursuant to the written terms of refer-

ence of the Audit Committee (which are available on the Company’s

website) are as follows:

– To monitor the integrity of the Consolidated Financial Statements of

the Group (including annual and interim accounts and results announce-

ments);

–

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 whistle-

blower procedures.

The Audit Committee meets not less than four times a year at appropri-

ate intervals in the financial reporting and audit cycle and otherwise

as required. The Audit Committee met on six occasions during 2021.

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. At least twice per year, the Audit Committee meets

privately with the external auditor to discuss issues relating to the

Company’s management and as required under the Companies Law.

“The Audit Committee performs a key

role in the Group’s governance frame-

work, in assessing internal controls

across the Group and ensuring the in-

tegrity of the Group’s financial results.”

Tami Gottlieb, Chair of the Audit Committee

Report of the Audit Committee

65Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

A summary of the major activities and decisions of the Committee in

2021 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.

Internal audit

review

Review assessments of the control environment via inter-

nal audit reports, and monitor progress on implementing

internal audit recommendations.

External audit

review

Review progress on implementing external audit recom-

mendations. Monitor and review the effectiveness and

independence 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 effective-

ness.

2021 internal

Committee

evaluation

Discussion and assessment of the 2020 and 2021 inter-

nal Audit Committee evaluation findings.

Governance – Review of the Committee’s terms of reference in light

of the Code and the Companies Law.

–

Review of 2021 Audit Committee Report which is

included within this Annual Report.

Significant accounting and financial judgements in 2021

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

and require the Committee’s attention.

The significant judgements considered were: revenue recognition,

uncertain tax positions, the control environment, compliance with laws

and regulations and appropriateness of the going concern basis of the

Consolidated Financial Statements and the level of cash required within

the business to satisfy both external regulators and the Group’s market

risk management.

External auditor

It is the responsibility of the Audit Committee to keep under review the

scope and effectiveness of the external auditor. This includes recom-

mending the appointment of the external auditor to the Board and

reviewing the scope of the audit, approving the audit fee and, on an

annual basis, satisfying itself that the auditor is independent. The

external auditor is engaged to express an opinion on the Consolidated

Financial Statements. The external auditor conducts the audit accord-

ing to the audit plan which include different audit procedures like con-

firmations, 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.

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 Compa-

nies Law, including all External Directors, and must be comprised

of a majority of Directors 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 (as of May

2021) who succeeded Charles Fairbairn, and its other members

are Daniel King (until his tenure finishing in June 2022), 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,

Daniel King 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 Committee members are set out on pages 52 – 53. Details

of individual attendance at meetings are set out in the Commit-

tee attendance table below.

Committee attendance (in FY 2021)

SCHEDULED

MEETINGS

ELIGIBLE TO

ATTEND

SCHEDULED

MEETINGS

ATTENDED

Tami Gottlieb (Chair)

5 4 (80%)

Daniel King 6 6 (100%)

Steve Baldwin 6 6 (100%)

Anne Grim 6 6 (100%)

Past members

Charles Fairbairn

3 3 (100%)

1. Tami Gottlieb was appointed as a member of the Committee on 16 March

2021 and serves as the Chair of the Committee as of 4 May 2021.

2. Charles Fairbairn (previous Chair of the Committee) stepped down from

the Committee and the Board on 4 May 2021.

3. Tami Gottlieb was unable to attend one Committee meeting due to illness.

General note: Prof. Varda Liberman was appointed as a member of the Com-

mittee in March 2022, thus she is not included in the Committee’s attendance

table in FY 2021.

66 Plus500 Ltd. 2021 Annual Report

Performance and effectiveness of the external auditor

Kesselman & Kesselman, a member firm of PricewaterhouseCoopers

International Limited, was appointed as the Company’s external audi-

tor in 2013 and has been retained since then to perform audit and

audit-related work on the Company and other local offices of Pricewa-

terhouseCoopers perform audit and audit-related work on the majority

of the Company's subsidiaries. The Committee assesses the auditor’s

independence and effectiveness 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 Commit-

tee is satisfied that the independence and objectivity of the external

auditor was adequately safeguarded throughout 2021. Nevertheless,

the external auditor’s independence and objectivity is kept under review

and is a standing item on the agenda for the Audit Committee.

In addition, the Audit Committee periodically monitors 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 2021, the Audit Committee concluded that the auditor has dem-

onstrated professional scepticism and judgement and that the audit

process as a whole has been conducted robustly and that the team

selected to undertake the audit has done so thoroughly and profession-

ally. The Audit Committee reviewed the re-appointment of the external

auditor and recommended to the Board that the external auditor be

proposed for re-election at the upcoming Annual General Meeting.

Audit tender process

The Committee remains satisfied with the external audit process and is

currently not planning to undertake a formal tender process until the

financial period ended 31 December 2023. In FY 2022, the external audit

engagement partner will be rotated.

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 audi-

tor’s independence or objectivity. During 2021, 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 $1.0m (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 auditors’ services. In addition, part of the non-

audit services in the amount of $0.7m 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 62.5% of the fees payable to the

external auditor in 2021.

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 assur-

ance 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.

Report of the Audit Committee continued

67Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

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 the revenue recognition process is appropriate and

controls are effective and are appropriately disclosed in the Financial Statements.

Uncertain tax positions

The Audit Committee is responsible for the

adequacy of the uncertain tax positions

–

The Audit Committee held meetings, among others, with management and tax advi-

sors to assist in assessing the technical aspect of the Group’s tax positions, includ-

ing 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 assess-

ment of the control

environment

The Audit Committee has the ultimate

responsibility for the supervision of the

control environment. A key role of the Com-

mittee is to provide oversight and reas-

surance to the Board with regard to the

integrity of the Company’s financial report-

ing, internal control policies and proce-

dures for the identification, assessment

and reporting of risk

– The Audit Committee reviewed the internal audit reports produced in the year, dis-

cussed 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 in assessing the internal audit

reports produced for 2021.

–

The Audit Committee concluded the internal controls are effective. No significant

internal control failings were identified during the year. Where any gaps were identi-

fied, processes were put in place to address them and these are continually monitored.

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 jurisdic-

tions according to its activity

– The Committee, in conjunction with the work of the Regulatory & Risk Committee,

reviewed regulatory reports prepared by the Risk & Compliance teams, to ensure

compliance with local regulations in the 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 Committees’ 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.

Review and assess-

ment of appropriate-

ness 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 2024, 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 liquidity

profile or capital position.

– The Audit Committee agreed to recommend the Going Concern and Viability State-

ment to the Board for approval.

Review and assess-

ment of the level of

cash required within

the business to satisfy

both external regula-

tors and the Group’s

attitude to market risk

The Group requires a level of cash to

ensure that it can operate its trading plat-

forms 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, operationally and risk perspective.

– The Audit Committee concluded that the cash amounts held are sufficient for all the

above-mentioned perspectives.

68 Plus500 Ltd. 2021 Annual Report

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 Director or the Chief Execu-

tive Officer of the Company;

– an officer or Director 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 2021. The Committee concluded that the internal audit func-

tion was an effective provider of assurance over the Company’s risks

and controls and appropriate resources were available as required.

Brightman Almagor Zohar & Co. (Deloitte Israel), a member firm of

Deloitte Touche Tohmatsu Limited, served as the Company’s internal

auditor in FY 2021.

In January 2022, the Company agreed with Deloitte that they will step

down as internal auditors of the Company. Following receipt of a rec-

ommendation from the Audit Committee, the Board has appointed E&Y

as the Company's new internal auditors as of FY 2022.

Whistleblowing policy

The Group operates a Whistleblowing Policy which encourages all

individuals within the Group (including employees, partners, consult-

ants, 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 whistle-

blowers protection from victimisation, harassment or disciplinary

proceedings. Such an anonymous reporting can be undertaken in local

languages. The Audit Committee reports to the Board on the effective-

ness of the Group’s whistleblowing mechanism and on any matter that

arises as a result of it. The current Whistleblowing Policy supervisor is

Daniel King. No whistleblowing complaints were received in 2021. Upon

Daniel King’s tenure finishing in June 2022, Steve Baldwin shall replace

Daniel and serve as the new Whistleblowing Supervisor.

Fair, balanced and understandable

The Audit Committee undertakes a duty to consider whether

the 2021 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 whole 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 to the Board of Directors to approve the Con-

solidated Financial Statements.

During the drafting process of the 2021 Annual Report and

Consolidated Financial Statements, the Committee is 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 evaluates 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 man-

ner to the shareholders.

Conclusion

Following the review, it was the Committee’s opinion that the

2021 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 infor-

mation necessary for shareholders to assess the financial posi-

tion, governance, performance, business model and strategy of

the Group.

Report of the Audit Committee continued

69Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

“With a global regulatory network al-

ready well established, the Group re-

mains well positioned for potential fu-

ture changes to the regulatory

environment across the markets in

which it operates.”

Sigalia Heifetz, Chair of the Regulatory & Risk Committee

Dear shareholder

I am privileged to have been appointed as Chair of the Regulatory &

Risk Committee and I would like to thank Penny Judd, as my predeces

sor, for her dedication and focus on ensuring that the Committee has

a clear framework from which to operate.

Regulatory compliance and risk management underpin the integrity of

our business model and continued delivery of our strategy. The Regu-

latory & Risk Committee receives regular reports on both compliance

and risk and challenges the performance in these areas. It also receives

AML reports, internal audit reports relating to the Group’s regulated

entities, and other reports on specific areas where more detailed test-

ing or investigation is felt appropriate. These are described more fully

in the following report.

In addition, the Board 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.

The Committee and the Board have received reports on the implemen-

tation of preparation for the ASIC product intervention order, which

came into force in March 2021, with respect to retail customers in

Australia, setting leverage restrictions, similar to ESMA levels, to all

Plus500AU operations (ASIC, FMA, FSCA). Also, the Committee and

the Board have received reports in relation to the potential Brexit sce-

narios and reports relating to the new trading products launched by

the Group in 2021 – share dealing through ‘Plus500 Invest’ and futures

and options on futures. Following this, the Committee received comfort

that the applicable measures have been considered and effectively

implemented.

The Group’s portfolio of licences is an increasingly valuable asset, given

its scarcity and the growing complexity of obtaining new licences. I am

pleased that during Q1 2022 this portfolio of operating licences was

further strengthened.

The licence granted in Estonia in February 2022 will further support

the Group’s business across European markets in its core product

offering, and the acquisition of a Type 1 regulated firm in Japan, com-

pleted in March 2022, represents a major growth opportunity for the

Group, through an immediate presence in the substantial retail trading

market in Japan.

Our priorities for the coming year will be to continue to monitor regula-

tory changes and to seek to continue to enhance the risk assessment

and monitoring within the business in the face of changing regulatory

and market conditions, including the continued impact of the COVID-19

pandemic.

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 the product port-

folio.

From a regulatory and compliance perspective, with a global regulatory

network already well established, 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.

Sigalia Heifetz

Chair of the Regulatory & Risk Committee

22 March 2022

Report of the Regulatory & Risk Committee

70 Plus500 Ltd. 2021 Annual Report

Committee composition

The Regulatory & Risk Committee is chaired by Sigalia Heifetz

(appointed as a member in February 2021 and as the Chair in

May 2021), succeeding Penny Judd. The other members are

Elad Even-Chen, Tami Gottlieb (appointed in March 2021), Prof.

Jacob A. Frenkel (appointed in May 2021) and Prof. Varda Liber-

man (appointed in March 2022). According to the Committee’s

terms of reference (which are available on the Company’s web-

site) the Committee shall comprise at least three members, and

the activities of the Committee should involve participation by

the Chair of the Audit Committee. The Chief Financial Officer

should be a committee member. Tami Gottlieb, Chair of the

Audit Committee is also a member of the Regulatory & Risk

Committee, as well as Elad Even-Chen, the Group’s Chief Finan-

cial Officer. Details of individual attendance at meetings is set

out in the Committee attendance table below.

Committee attendance (in FY 2021)

SCHEDULED

MEETINGS

ELIGIBLE TO

ATTEND

SCHEDULED

MEETINGS

ATTENDED

Sigalia Heifetz (Chair)

3 2 (67%)

Elad Even-Chen 3 3 (100%)

Tami Gottlieb

2 2 (100%)

Prof. Jacob A. Frenkel³ 2 2 (100%)

Past members

Penny Judd

1 1 (100%)

Charles Fairbairn

0 0

1. Sigalia Heifetz was appointed as a member of the Committee on 4Febru-

ary 2021 and serves as the Chair of the Committee as of 4 May 2021.

2. Tami Gottlieb was appointed as a member of the Committee on 24March

2021.

3. Prof. Jacob A. Frenkel was appointed as a member of the Committee on

12 May 2021.

4. Penny Judd (previous Chair of the Committee) stepped down from the

Committee on 4 May 2021.

5. Charles Fairbairn stepped down from the Committee on 3 February 2021,

prior to any scheduled meeting of the Committee.

6. Sigalia Heifetz was unable to attend one Committee meeting due to illness.

General note: Prof. Varda Liberman was appointed as a member of the Com-

mittee in March 2022, thus she is not included in the Committee’s attendance

table in FY 2021.

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 regu-

latory 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 oversee-

ing and monitoring the Group’s compliance with applicable laws, regula-

tions 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 Sey-

chelles, 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

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, ensuring

that the Company’s Board ethics are being adhered to. The other key

governance mandates, pursuant to the written terms of reference of the

Regulatory & Risk Committee, are as follows:

– 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 informa-

tion 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

2021 is set out below.

Regulatory &

Compliance

review

– Periodic regulatory, compliance and AML reports review.

–

Periodic AML reports (on the Group’s regulated entities) review.

–

Oversee the implementation of new regulatory requirements.

–

Monitor and assess the Group’s relationships with regulatory

authorities.

Licence

application

review

– Review licence applications submitted during the period.

Risk review

and

assessment

– Review periodic risk reports, including VaR reports.

– Review risk assessment programmes and internal risk man

agement controls.

– Review emerging and principal risks for the period.

–

Review and assess current approach to hedging as well as

possible options for future approach in this area.

2021 internal

Committee

evaluation

–

Discussion and assessment of the 2020 and 2021 internal

Regulatory & Risk Committee evaluation findings.

Governance

– Review of the Committee’s terms of reference.

–

Review of 2021 Regulatory & Risk Committee Report which is

included within this Annual Report.

Report of the Regulatory & Risk Committee

continued

71Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Report of the ESG Committee

“The Company supports the recommendations

published by the Financial Stability Board’s

Task Force on Climate-Related Financial Dis-

closures and during 2021, the Committee

worked with a specialist ESG consultant,

which conducted a rigorous gap analysis and

assessment of the Group’s ESG reporting

and disclosure.”

Daniel King, Chair of the ESG Committee

Dear shareholder

ESG has become a critical element of organisational culture, operations,

reporting and disclosure and is now 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 perfor-

mance. Furthermore, investors are seeking more understanding and

detail about how companies are managed in this regard.

In this context, and with increasing reporting and disclosure require-

ments for companies in this area, the Board established its ESG Com-

mittee in 2020, primarily to regularly review and assess the Group’s

ESG activities and align them with industry and market best practice.

With this in mind, the Committee, the Board and the Group remain

committed to developing Plus500’s ESG strategy, and will continue to

broaden its disclosure on ESG in order to ensure key stakeholders have

a clear and comprehensive understanding of the Group’s activities in

these areas.

As the Chair of the ESG Committee, I am pleased to provide an overview

of the work carried out by the ESG Committee in 2021, as well as its

objectives and priorities.

As a starting point, the Committee initiated a Materiality Assessment,

which was carried out at the beginning of 2021, to identify key ESG

priorities and risk factors and to establish a framework for the Group’s

future approach in these areas and, ultimately, to increase the Group’s

resilience over the long-term.

The framework for this assessment was based on internationally

accepted standards and frameworks such as the Sustainability Account-

ing Standards Board (SASB) and the Global Reporting Initiative (GRI),

and was driven by the findings and insights from interviews with a

number of key individuals from the Board, the executive team and

several major shareholders.

The assessment 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 2021 in

each of the areas can be found elsewhere in this Annual Report, in

particular in the ESG section on pages 30 – 37.

With the assessment laying the foundations of the Group’s approach

in this area, the Committee made strong progress during the year to

develop our position in ESG, in particular by refreshing our reporting

and disclosure, in line with the latest regulatory and disclosure require-

ments, as exemplified in various sections of this Annual Report.

The Company supports the recommendations published by the Finan-

cial Stability Board’s Task Force on Climate-Related Financial Disclosures

(TCFD) and during 2021, 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 initial reporting and disclosure against the TCFD

recommendations, which includes the reporting of our Scope 1 and

Scope 2 emissions data, for the first time. This information, including

the Group’s future plans to continue to align itself to the TCFD recom-

mendations, is outlined in the ESG section on pages 36 – 37 of this

Annual Report.

Also, during the year, the Committee and the Board developed an

Environmental Policy, which is available on the Company’s website. As

a technology-based business, Plus500 does not carry out any industrial

activity and is not involved in anything which would emit environmen-

tally harmful substances but has made various commitments, includ-

ing, to protect the environment, to reduce waste as well as water, energy,

and resource use and to monitor the Group’s environmental performance.

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 2020-2021 (both

72 Plus500 Ltd. 2021 Annual Report

Committee composition

The ESG Committee is chaired by Daniel King. The other mem-

bers are Steve Baldwin and Anne Grim. According to the Com-

mittee’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 and at least one mem-

ber shall be an External Director. All of the Committee members

are Independent Non-Executive Directors and Anne Grim and

Daniel King are also considered as External Directors.

As of June 2022, Steve Baldwin will Chair the ESG Committee

and an additional member will be appointed to the Committee,

alongside Steve Baldwin and Anne Grim. Details of individual

attendance at meetings is set out in the Committee attendance

table below.

Committee attendance (in FY 2021)

SCHEDULED

MEETINGS

ELIGIBLE TO

ATTEND

SCHEDULED

MEETINGS

ATTENDED

Daniel King (Chair) 4 4 (100%)

Steve Baldwin 4 4 (100%)

Anne Grim 4 4 (100%)

monetary and in kind donations), the profile of charitable and non-profit

organisations which received the donations and future charitable ini-

tiatives.

Having served as an Independent Non-Executive Director and External

Director since the Company’s IPO in 2013, I will end my third and final

three-year term under the provisions of the Companies Law pertaining

to the term of an External Director, in June 2022. Therefore, as I am

not eligible under the Companies Law for re-election this year, I will be

stepping down from the Board and all related Board Committees.

So, in my final ESG Committee report, I would like to say that it has

been a privilege to have Chaired this Committee since it was established.

It is crucial that the Board ensures Plus500’s approach to the relevant

elements of ESG continues to develop and are clearly understood by

the investment community. To this end, I wish Steve Baldwin the best

of luck as my successor as Chair of the ESG Committee, and I am sure

he will provide dynamic leadership in such a vital area for the Group.

Daniel King

Chair of the ESG Committee

22 March 2022

Report of the ESG Committee continued

73Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

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, biodi-

versity and habitat, impact on water resources and the status of water

bodies, pollution, resources 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 counter-

parties, 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 procure

ment, any social or community projects undertaken by the Group and

social aspects of the supply chain, community and stakeholder engage-

ment or partnerships; and

– Governance: the ethical conduct of the Group’s business including its

business ethics policies, code of conduct and counterparty due dili-

gence.

The other key governance mandates, pursuant to the written terms of

reference of the ESG Committee, are as follows:

–

To ensure that sufficient focus and resource is given to implementing,

monitoring and management;

– 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 pro

motional 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.

A summary of the major activities and decisions of the Committee in

2021 is set out below:

Reports and

Policies review

– Periodic review of ESG reports.

–

Review of succession planning (from a gender diver-

sity perspective).

– Review of Donations & Volunteering Procedure.

Adoption of an

Environmental

Policy

– Adoption of a new Policy – Environmental Policy.

Donations and

Charitable

initiatives

review

–

Review type and amounts of donations made during

2020-2021 (both monetary and in-kind donations), pro-

file of charitable and/or non-profit organisations which

received the donations and future charitable initiatives.

Materiality

Assessment

–

Review of, and feedback on, detailed materiality assess

ment.

–

Discussion and agreement on key priority areas emanat-

ing 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 report-

ing and disclosure, based on the findings of this analy-

sis.

–

This included discussion on the rationale of initial report-

ing of the Group’s Scope 1 and Scope 2 emissions data

(which is included on page 36 of this Annual Report).

2021 internal

Committee

evaluation

–

Discussion and assessment of the 2020 and 2021

internal ESG Committee evaluation findings.

Governance – Review of the Committee’s terms of reference.

–

Review of 2021 ESG Report which is included within

this Annual Report.

–

Review of 2021 ESG Committee Report which is includ-

ed within this Annual Report.

74 Plus500 Ltd. 2021 Annual Report

Dear shareholder

As the Chair of the Remuneration Committee, and on behalf of the

Board, I am pleased to present the Remuneration Committee Report

for the year ended 31 December 2021.

Plus500 is a corporate entity registered in Israel and is therefore not

legally required to comply with the requirements applicable to a UK

incorporated listed company. The Directors’ Remuneration Report,

which will be put to shareholders’ vote (as an advisory vote) at the 2022

AGM, has been prepared with a view of the standards for a UK listed

company, while making required adjustments in order to conform with

the requirements under the Israeli law and market practices in Israel.

To this end, our Directors’ Remuneration Report provides a short over-

view of the new Directors’ Remuneration Policy which was approved

by shareholders at the 2021 AGM held on 4 May 2021, with an excellent

support of over 94% of the votes and the Annual Report on Remu-

neration that sets out the remuneration paid in respect of performance

in 2021.

Going forward, shareholders’ approval will be sought for our Remu-

neration Policy once every three years or earlier if a change to policy

is required, as was sought in 2021 for the years 2021, 2022 and 2023.

Shareholders will 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.

The Committee understands that historically shareholders have had

concerns about Executive Directors pay and it has therefore undertaken

a thorough and comprehensive review of the remuneration policy and

operation concluded in Q1 2021 with the support of external advisors

Korn Ferry with a clear understanding of market practice and investor

expectations. This has been followed with a period of consultation with

a substantial number of our shareholders and shareholder advisory

bodies. Feedback from investors has been positive overall noting the

substantial changes made. Investors have also understood that there

is a small number of matters that are not fully aligned with UK investor

expectations and that the Committee will look to review these matters

again over the policy period and at the latest at the next policy renewal

in 2024. The Committee refined certain aspects of its original propos-

als and is grateful for investor feedback on these matters.

The newly approved remuneration policy for FY 2021, FY 2022 and FY

2023 provides some far-reaching changes from the previous policy to

ensure that we are making significant strides to align to a UK norm.

The Committee is however cognisant of distinct sector and market

dynamics in Israel where Plus500 is headquartered, the competition

over talent in the Israeli market place and in the sector as a whole (this

competition intensified in 2021 which saw a large amount of Israeli

tech companies IPO in the international markets and an ever intensify-

ing competition for talents within the sector in Israel). I would also like

to emphasise that the changes proposed have a significant impact on

the way in which the current Executive Directors are paid. The Com-

mittee will therefore continue its journey over future policy reviews,

keeping the approach and the structure of the Executive Directors’

packages under review but it very much hopes that investors will

continue to be supportive of the substantial progress that has been

made in moving towards a UK norm at this time.

As part of our remuneration policy review, we have considered our

remuneration reporting. Our 2021 Remuneration Report provides clearer

and more transparent disclosures more closely aligned to UK practice.

We will continue to evolve this reporting to provide additional disclosures

in future years so as to make our disclosure more aligned to UK best

practice and the UK Directors’ Remuneration Reporting Regulations.

“The newly approved remuneration pol-

icy for FY 2021-FY 2023 provides

some far-reaching changes from the

previous policy to ensure that we are

making significant strides to align to a

UK norm.”

Daniel King, Chair of the Remuneration Committee

Report of the Remuneration Committee

75Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Business performance

2021 was another year of major operational, financial and strategic

success for Plus500, building on its long-term track record of performance

since the IPO in 2013. The Group delivered further positive momentum

during the year, driven by another very strong year of customer acquisi-

tion and retention, which ensured that Plus500’s operational and finan-

cial performance was well ahead of pre-pandemic levels.

While we have had to deal with the continued impact of COVID-19 in

terms of managing our business, we have not been affected in the

same way as many other businesses. The Company has not received

any government support and none of the employees have been fur-

loughed but have retained their normal remuneration arrangements

with payment of bonuses in the usual way reflecting business perfor-

mance for 2021.

2021 operation of policy

Following a year of outstanding performance, the annual bonus targets

were met in full with bonus payable to David Zruia of $1,590,000 and

Elad Even-Chen of $1,590,000.

Under the new policy, Share Appreciation Rights will no longer be

awarded to the Executive Directors.

Full details of the remuneration payable for 2021 performance and

performance against targets is set out in the Annual Report on Remu-

neration.

The Committee is comfortable that the remuneration paid for 2021 is

aligned to the strong performance in the year and investor returns.

Proposed increase in fees for Chair and 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 Direc-

tors, the Remuneration Committee proposes to increase the remu-

neration of the Chair of the Board and the remuneration of each of the

Board’s Non-Executive Directors.

Further details of these proposed changes can be found in the Notice

of the 2022 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

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 acqui-

sition in Japan. In addition, the Group is expected to establish further

new operations in additional geographies over the next 12 months and

into the future.

With the expanded, and expanding, global operations of the Group,

additional time, availability and attention is required of the Non-Exec-

utive Directors. The Remuneration Committee therefore believes the

remuneration increase being proposed is commensurate with the

increased attention and time required of the Non-Executive Directors,

to take account of an expanded and more globally diversified business.

In addition, this proposed level of remuneration is 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.

Rationale for proposed increase in remuneration of Chair of the

Board

The rationale for the Remuneration Committee’s proposed increased

in the remuneration of Prof. Frenkel as Chair of the Board is set out

below.

Firstly, the Remuneration Committee has taken 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, he has significant,

long-standing experience in the US financial, futures and capital markets,

with a long track record of engaging with regulators and major govern-

ment agencies and institutions in the US and around the world. His

detailed biography can be found on page 52.

Secondly, the Group is already benefiting from leveraging his substan-

tial and established global relationship network.

With this in mind, and given his significant leadership and contribution

to Board meetings already in evidence over the last ten months, Prof.

Frenkel is proving to be a significant asset to the Company in crafting

its strategic objectives and advancing the development of its opera-

tions.

Some of the progress achieved by Plus500 in FY 2021 and in Q1 2022

would not have occurred without the leadership, guidance and contact

network of Prof. Frenkel, in particular the Group’s significant progress

made in the US futures and options on futures market during the year.

The Remuneration Committee therefore believes that the proposed

increase in Prof. Frenkel’s remuneration is appropriate for the level of

value that he is providing, and will continue to provide, for the Group

and its shareholders.

Next steps

The proposed increase in remuneration of the Non-Executive Directors

of the Board, including those of Prof. Frenkel as an Independent Non-

Executive Director and Chair of the Board, will be put to a shareholder

vote at the Company’s 2022 AGM.

Concluding remarks

The Committee and I would like to thank our investors who had been

supportive and approved our new remuneration policy. I am grateful for

the engagement, feedback and support we have received from our

shareholders as we have finalised these new remuneration arrangements.

The Committee and the Board noted that two of the resolutions which

were passed at the 2021 AGM had more than 20% of votes cast against

them. These resolutions related to an advisory vote on the Directors’

Remuneration Report and a tax-related bonus payment regarding the

Company obtaining a highly beneficial approval from the Israeli Tax

Authority and the Israel Innovation Authority as a Preferred Techno-

logical Enterprise.

76 Plus500 Ltd. 2021 Annual Report

As mentioned in our 2020 Remuneration Committee Report, our Remu-

neration Committee and Board resolved that payment of this one time

bonus was advisable and in the interest of the Company on the basis

of assessing the real value of this project while understanding that this

particular project is not typically part of the on-going duties of a CFO.

The Board is in no doubt that the Preferred Technological Enterprise

status would not have been secured were it not for Elad Even-Chen’s

enormous and unrelenting commitment to achieving it. The fact that

these approvals for the years 2017, 2018, 2019, 2020 and 2021 were

secured during the height of the COVID-19 pandemic when face to face

meetings and discussions were not possible is all the more impressive.

Following consultations made with shareholders ahead of our 2021

AGM, the Remuneration Committee excluded special, one-off bonuses

in future Executive Remuneration plans in the Company’s updated Remu-

neration Policy. A resolution to approve the updated Remuneration

Policy was approved by over 94% of shareholders’ votes at the 2021

AGM.

Since the 2021 AGM results, the Board engaged with various shareholder

advisory bodies and a number of shareholders, taking into account

their feedback.

Report of the Remuneration Committee

continued

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.

Lastly, given this will be my final report as Chair of the Remuneration

Committee, I would like to say that it has been an honour to serve the

Board, the Company and our shareholders in this important role over

the last years. In that time, the Board’s approach to Remuneration has

remained clear, rigorous and aligned with market practice. So, I hope

to have left the Committee, and its practices and processes, in good

shape for my successor, Anne Grim, to continue its positive work, for

which I wish her the best of luck.

Daniel King

Chair of the Remuneration Committee

22 March 2022

77Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

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 con-

sist of at least three members, and all of the External Directors

must be members of the committee (one of which to be appointed

as the chair) and constitute the majority thereof. The remaining

members must be Directors who qualify to serve as members of

the Audit Committee as defined in the Companies Law and whose

compensation is in accordance with the compensation require-

ments applicable to the External Directors. The Chair of the Remu-

neration Committee must be an External Director.

The Remuneration Committee comprises four independent

Non-Executive Directors: Daniel King, Anne Grim, Sigalia Heifetz

and Tami Gottlieb and is chaired by Daniel King. Sigalia Heifetz

and Tami Gottlieb joined the Committee on 4 February 2021

and 16 March 2021, respectively. Daniel King, Anne Grim and

Tami Gottlieb are considered External Directors under the Com-

panies Law. Upon Daniel King’s end of tenure in June 2022, Anne

Grim, who qualifies to serve as the Chair of the Remuneration

Committee under the Companies Law (being an External Direc-

tor) and under the Code (having served on the Committee for

more than twelve months), will chair the Remuneration Com-

mittee. Details of the skills and experience of the Remuneration

Committee members can be found on pages 52 – 53.

Committee attendance (in FY 2021)

REMUNERATION COMMITTEE

SCHEDULED

MEETINGS

ELIGIBLE TO

ATTEND

SCHEDULED

MEETINGS

ATTENDED

Daniel King (Chair) 3 3 (100%)

Anne Grim 3 3 (100%)

Sigalia Heifetz

3 3 (100%)

Tami Gottlieb

3 2 (67%)

Past members

Steve Baldwin

1 1 (100%)

Charles Fairbairn

0 0

1. Sigalia Heifetz was appointed as a member of the Committee on 4February

2021.

2. Tami Gottlieb was appointed as a member of the Committee on 16 March

2021.

3. Steve Baldwin stepped down from the Committee on 12 May 2021, follow-

ing the Board’s decision that the Remuneration Committee comprise up to

four members, to ensure an appropriate balance of Board members on

each Board Committee.

4. Charles Fairbairn stepped down from the Committee on 3 February 2021,

prior to any scheduled meeting of the Committee.

5. Tami Gottlieb was unable to attend one Committee meeting due to illness.

Annual report on remuneration 2021

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 Com-

mittee 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 are as follows:

–

Reviewing the remuneration policy and approving a Remu-

neration Policy at least once in every three years;

– Approving and recommending to the Board and, where appli-

cable, the shareholders, the total individual remuneration pack-

age of the Chair of the Board, each Executive and

Non-Executive Director, the Chief Executive Officer, Chief Finan-

cial Officer and other office holders (including bonuses, incen-

tive payments and share options or other share awards);

–

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 recom-

mendations 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 share-

holders.

The Committee approved its new terms of reference in 2021

(which are available on the Company’s website).

78 Plus500 Ltd. 2021 Annual Report

A summary of the major activities and decisions of the Committee in

2021 is set out below:

Salary/base

service fees

– Executive Directors’ remuneration review.

– Review and approval of Non-Executive Directors’ fees

and recommendations to our shareholders and obtain-

ing a benchmark from a leading consultant on this issue.

– Review and approval of Chair’s fees and recommenda-

tions to our shareholders.

– Review of senior management fees.

Bonus –

Review of the performance of the Chief Executive

Officer and the Executive Directors compared to the

targets set and approval of annual bonus awards for

2021 based on performance targets.

Long Term

Incentive Plans

(“LTIPs”)/

Restricted

Share Units

(“RSUs”)

–

Review of Executive Directors’ 2021 LTIP and RSU plans

(including addition of KPIs).

– Review of updated clawback and malus provisions.

2021 internal

Committee

evaluation

–

Discussion and assessment of the 2020 and 2021

internal Remuneration Committee evaluation findings.

Governance –

Review of corporate governance and determining appro-

priate levels of disclosure for the 2021 Directors’ Remu-

neration Report.

–

Review of 2021 AGM season 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 2021 Remuneration Committee Report which

is included within this Annual Report.

– Review of 2021 Directors’ Remuneration Report which

is included within this Annual Report.

Other –

Review of remuneration consultant costs and appoint-

ment.

–

Review of workforce remuneration policies and com-

parison of such policies with senior management policies.

– Review talent pipeline and its remuneration.

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 rel-

evant regulatory developments in the UK, information on Israeli market

trends and compensation structures on a broader Group level.

Remuneration policy

Pursuant to the Companies Law, all public Israeli companies, including

companies whose shares are only publicly traded outside of Israel, such

as the Company, are required to adopt a written remuneration policy for

their Directors 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.

As mentioned above, the Committee has undertaken a thorough and

comprehensive review of the remuneration policy and operation, con-

cluded in Q1 2021 with the support of external advisors Korn Ferry.

Following the review, the Committee and the Board resolved to bring

an amended Remuneration Policy for the approval of the Company’s

shareholders at its 2021 AGM.

In developing the new Remuneration Policy, the Remuneration Com-

mittee consulted with major shareholders (covering over 50% of the

issued share capital) for their views on the proposals and also engaged

with shareholder advisory bodies. Based on the independent advice

received from Korn Ferry, as well as the feedback received from the

major shareholders and the shareholder advisory bodies. Following

this process, our new Remuneration Policy was approved by sharehold-

ers at the 2021 AGM on 4 May 2021.

The new 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 a UK norm. The Committee is however cognisant of distinct

sector and market dynamics in Israel where Plus500 is headquartered,

the competition over talent in the Israeli marketplace and in the sector

as a whole. It would also like to emphasise that the changes made to

the policy have a significant impact on the way in which the current

Executive Directors are paid. The Committee will therefore continue its

journey over future policy reviews, keeping the approach and the struc-

ture of the Executive Directors’ packages under review but very much

hopes that investors will be supportive of the substantial progress that

has been made in moving towards a UK norm at this time.

Amongst other matters, the new Remuneration Policy for Executive

Directors provides for the:

– Reduction of incentive quantum and rebalancing from short-term to

long-term incentives;

– Changes to the annual bonus structure which includes a reduction of

the maximum bonus opportunity and moving the entire deferred bonus

element into shares;

– Removal from the policy of the ability to pay discretionary bonuses;

and

– Changes to the long-term incentive structure which includes removal

of the Share Appreciation Rights long-term incentive which pays out

100% in cash, replacing this with performance shares.

Report of the Remuneration Committee

continued

79Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Stakeholder engagement

Employees

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 via email 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 custom-

ers and suppliers. Steve reports any key messages deriving from such

conversations to the Board and ensures that such messages are con-

sidered as part of the Board’s decision-making process. The Company

is not obliged to comply with Section 172 of the UK Companies Act

2006. Plus500 holds regular employee workshops and briefings on a

variety of topics and conducts round table discussions with its employ-

ees 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 the Remuneration Committee Chair’s Statement and

the section above on our remuneration policy, in developing the new

Policy, the Committee consulted with major shareholders (covering over

50% of the issued share capital) for their views on the proposals and

also engaged with other shareholder advisory bodies. Feedback from

investors has been positive overall noting the substantial changes made.

Investors have also understood that there is a small number of matters

that are not fully aligned with UK investor expectations and that the

Committee will look to review again these matters over the policy period

and at the latest at the next policy renewal due in FY 2024. Following

initial feedback, the Committee refined certain aspects of its original

proposals and is grateful for investor feedback on these matters.

Following this shareholders’ engagement, the Remuneration Commit-

tee excluded special, one-off bonuses in future Executive Remuneration

plans in the Company’s Remuneration Policy. A resolution for this

updated Remuneration Policy was approved by over 94% of sharehold-

ers’ votes cast at the 2021 AGM.

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 market-

place 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 stand-

ards 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., but for no more

than necessary.

Non-Executive Directors

Non-Executive Directors are appointed for a one-year term and are

subject to re-election at each AGM. Notwithstanding, External Directors

are appointed by shareholders for a three-year term and are subject to

re-election by shareholders at an EGM or AGM every three years. 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.

According to the Companies Law, the appointment of External Directors

is for a period of three years from the date of appointment by the

Company’s shareholders (which may be extended for two more three-

year terms).

80 Plus500 Ltd. 2021 Annual Report

The table below details the date and period of appointment of each Non-Executive Director

NAME POSITION

DATE OF

APPOINTMENT

TO THE BOARD

OF DIRECTORS

DATE OF

RE-APPOINTMENT

TO THE BOARD

OF DIRECTORS

PERIOD OF

APPOINTMENT

Prof. Jacob A. Frenkel Independent Non-Executive Director and Chair May 2021 N/A 1 year

Anne Grim Senior Independent Non-Executive Director and External Director September 2020 N/A 3 years

Daniel King Independent Non-Executive Director and External Director June 2013 June 2019 3 years

Steve Baldwin Independent Non-Executive Director June 2017 May 2021 1 year

Sigalia Heifetz Independent Non-Executive Director February 2021 May 2021 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 N/A until the 2022 AGM

The table below details the date and period of appointment of each Executive Director presiding

NAME POSITION

DATE OF

APPOINTMENT

TO THE BOARD

OF DIRECTORS

DATE OF

RE-APPOINTMENT

TO THE BOARD

OF DIRECTORS

PERIOD OF

APPOINTMENT

David Zruia Executive Director April 2020 May 2021 1 year

Elad Even-Chen Executive Director June 2016 May 2021 1 year

Report of the Remuneration Committee

continued

81Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Annual report on remuneration 2021

Introduction

This report sets out information about the remuneration of the Directors, including the Chief Executive Officer and the Chief Financial Officer of

the Company, for the year ended 31 December 2021.

Audited information – Directors’ remuneration – 1 January 2021 to 31 December 2021

Single figure of remuneration

The detailed emoluments received by the Executive and Non-Executive Directors during the year ended 31 December 2021 are detailed below.

The information provided in the section and accompanying notes has been audited by Kesselman & Kesselman, a member firm of Pricewater-

houseCoopers International Limited.

SALARY/BASE

SERVICE FEES

OTHER

EXPENSES

TOTAL

FIXED PAY

ANNUAL

BONUS

LTIPs/RSUs

APPRECIATION

RIGHTS

TOTAL

VARIABLE PAY

TOTAL

(US$000) 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020

Executive Directors

David Zruia 636 319 220 87 856 406 1,590 1,015 – – – 752 1,590 1,767 2,446 2,173

Elad Even-Chen 636 498 142 – 778 498 1,590 1,972 265 – – 964 1,855 2,936 2,633 3,434

Non-Executive Directors

Jacob A. Frenkel

(Chair) 472

N/A – – 472 N/A – – – – – – – – 472 N/A

Anne Grim

100 36 – – 100 36 – – – – – – – – 100 36

Daniel King 103 88 – – 103 88 – – – – – – – – 103 88

Steve Baldwin 103 88 – – 103 88 – – – – – – – – 103 88

Tami Gottlieb

84 N/A – – 84 N/A – – – – – – – – 84 N/A

Sigalia Heifetz

98 N/A – – 98 N/A – – – – – – – – 98 N/A

Past Non-Executive

Directors

Penny Judd

71 194 – – 71 194 – – – – – – – – 71 194

Charles Fairbairn

57 153 – – 57 153 – – – – – – – – 57 153

1. 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.

2. Anne Grim was appointed as a Non-Executive Director and External Director on 16 September 2020.

3. Tami Gottlieb was appointed as a Non-Executive Director and External Director on 16 March 2021.

4. Sigalia Heifetz was appointed as a Non-Executive Director on 4 February 2021.

5. Penny Judd stepped down from the Board at the 2021 AGM held on 4 May 2021.

6. Charles Fairbairn stepped down from the Board at the 2021 AGM held on 4 May 2021.

7. The remuneration terms comprised of a salary for David Zruia and service contract fees for Elad Even-Chen (the “base service fees”).

8. Includes social and other contractual related expenses.

9. An amount of ILS 345,000 was paid by allotment of ordinary shares of the Company.

General notes:

(a) Prof. Varda Liberman was appointed as a Board member in March 2022, thus she is not included in the above table which relates to FY 2021.

(b) No Restricted Share Units (“RSUs”) awards had performance periods ending in the financial years ended on 31 December 2021 and 2020.

(c) In line with the UK reporting regulations, LTIP awards shall be reported in the year that the performance period ends with the value of the award on grant date. No LTIP

awards presented accordingly in the financial year ended on 31 December 2020.

Directors’ Remuneration Report

82 Plus500 Ltd. 2021 Annual Report

Directors’ Remuneration Report continued

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 entitle-

ments, LTIP schemes and other contractual related expenses on terms decided by the Remuneration Committee for specific projects provided

by the consultant.

Commentary on the single figure table

Base salary, base service fees and social and other contractual related expenses

David Zruia’s base salary in 2021 was ILS 2,060,000 as approved by the AGM on 4 May 2021. Elad Even-Chen’s base service fees in 2021 was

ILS 2,060,000 as approved by the AGM on 4 May 2021.

Annual Bonus

The 2021 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%

Achievement of an EPS growth rate. Target EPS

threshold of $1.98. 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 2021 is $3.06 100%

Revenue 20%

Achievement of revenue growth rate. Target revenue

threshold of $438.7m. 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 2021 is $718.7m 100%

Total 60% 100%

The Committee carefully assessed performance against objectives set for the annual bonus and noting exceptionally strong performance against

all of the objectives set, determined full achievement of the objectives.

The details of some of the specific targets and performance against them are not disclosed as the Board believes they are commercially sensi-

tive. 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, given the nature of the objectives, so that investors can be com-

fortable that the Remuneration Committee has used a thorough approach in setting the objectives and targets and measuring the outcome.

83Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

NON-FINANCIAL

METRICS WEIGHTING OBJECTIVES PERFORMANCE

ACHIEVEMENT

(% OF MAXIMUM)

Operational 40% Achievement of operational targets comprise

three elements: Customers and Systems,

Operations and Risk & Regulation

Parameters achieved for 2021 100%

Total 40% 100%

Based on the performance described above the Committee agreed the following 2021 bonus awards based on 100% of the maximum

opportunity.

2021 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 1,060 530 1,590 250%

Elad Even-Chen 1,060 530 1,590 250%

* 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

2021. The number of ordinary shares allotted on the payment date were calculated based on the ordinary share price at 1 January 2021, as

adjusted for dividends.

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.

As of FY 2021 and FY 2022 there are no new SARs entitlements for Executive Directors.

In respect of FY 2020 SARs granted on 31 December 2019, the remuneration package to David Zruia included SARs granted in the amount of

$634,737 (ILS 2,200,000) in December 2019 and will be vested after three years in December 2022. The remuneration package to Elad Even-Chen

included SARs granted in the amount of $721,293 (ILS 2,500,000) in December 2019 and will be vested after three years in December 2022.

84 Plus500 Ltd. 2021 Annual Report

2021 LTIP/RSUs Awards

Scheme interests awarded during the year ending 31 December 2021

Executive Directors were granted Long Term Incentive Plan (“LTIP”) and Restricted Share Units (“RSUs”) Grants in respect of 2021 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,

as set by the Board

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

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

David Zruia 1 January 2021 80,856 1,597,791 31 December 2023 250%

Elad Even-Chen 1 January 2021 80,856 1,597,791 31 December 2023 250%

1. Percentage calculation based on annual amounts of the contractual agreements in ILS.

General notes:

(a) Face value of the award and the number of shares granted on grant date are calculated with reference to share price on 1 January 2021 of 1,450 GBP pence and FX rate

USD/ILS of 3.223.

(b) David Zruia’s award is structured as RSUs, in accordance with the provisions of the Capital Gain route under Section 102 of the Israeli Tax Ordinance.

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 achiev-

ing 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 dividends. An amount equal to the applicable tax liability connected to the LTIPs, RSUs 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 2019 LTIP Grant was subject to service condition and was not subject to any additional KPIs or conditions. The 2019 LTIP Grant was vested

on 31 December 2021 and the Company issued 19,111 of its treasury shares.

Payments to past Directors and payments for Loss of Office

Non-Executive Directors Penny Judd and Charles Fairbairn both stepped down from the Board at the 2021 AGM held on 4 May 2021. They were

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.

Directors’ Remuneration Report continued

85Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

Further information on 2021 remuneration

Directors’ shareholdings and share plan interests

Summary of Directors’ shareholdings and share plan interests as at 31 December 2021

OUTSTANDING SCHEME

INTERESTS AS AT 31/12/2021 BENEFICIAL OWNERSHIP IN SHARES

SUBJECT TO

PERFORMANCE

CONDITIONS

WITHOUT

PERFORMANCE

CONDITIONS

AS AT

1 JANUARY

2021

AS AT

31 DECEMBER

2021

SHAREHOLDING

REQUIREMENT

(% OF SALARY/BASE

SERVICE FEES)

CURRENT

SHAREHOLDING

AS AT 31/12/2021

(% OF SALARY/BASE

SERVICE FEES)

Executive Directors

David Zruia 100,726 – 17,000 46,031 200% 128%

Elad Even-Chen

119,430 27,324 54,100 184,075 200% 511%

Non-Executive Directors

Jacob A. Frenkel – – N/A

5,424 – –

Anne Grim – – – – – –

Daniel King – – 27,169 30,993 – –

Steve Baldwin – – – – – –

Tami Gottlieb – – N/A

– – –

Sigalia Heifetz – – N/A

– – –

Past Non-Executive Directors

Penny Judd

– – 25,691 25,691

– –

Charles Fairbairn – – 55,000 55,000

– –

As of 31 December 2021, none of the presiding Board members held more than 0.18% in the Company’s issued share capital.

1. Save 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 2021 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. The shares are registered in the name of Penny Judd’s spouse, Julian Judd.

5. Prof. Jacob A. Frenkel was appointed as a Director on 4 May 2021.

6. Tami Gottlieb was appointed as a Director on 16 March 2021.

7. Sigalia Heifetz was appointed as a Director on 4 February 2021.

8. Penny Judd shareholding as at date when stepped down from the Board, 4 May 2021.

9. Charles Fairbairn shareholding as at date when stepped down from the Board, 4 May 2021.

10. Gal Haber shareholding as at date when stepped down from the Board, 4 January 2021.

General notes:

(a) Prof. Varda Liberman was appointed as a Board member in March 2022, thus she is not included in the above table which relates to FY 2021. Also, as of the date of this

Annual Report she does not hold any beneficial ownership in shares.

(b) Outstanding scheme interest as at 31 December 2021 include 2020 and 2021 LTIP/RSU awards that have not vested, and vested deferred bonus for 2019

and 2020.

(d) Current shareholding as at 31 December 2021 as a % of salary/base service fees were calculated based on share price as at 31 December 2021 of and FX GBP/ILS as of

that date.

(e) There have not been any changes in Directors’ beneficial ownership in shares of the Company between 31 December 2021 and the date of this Annual Report.

(f) Gal Haber held 2,069,769 shares as at the date when steeped down from the Board, 4 January 2021.

86 Plus500 Ltd. 2021 Annual Report

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 2021 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

£1,000

£1,500

£2,000

£2,500

£3,000

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

Plus500

FTSE AllShare index

31 Dec

2012

2021

CEO single figure total remuneration ($000s) 2,446

Annual bonus achieved for 2021 (as % of maximum opportunity) 100%

Relative importance of the spend on pay

The following table sets out the change in dividends and overall spend on pay in the years ended 31 December 2021 and 2020.

US$ IN MILLIONS 2020 2021 PERCENTAGE CHANGE

Total gross employee and other related expenses pay 50.8 58.9 16%*

Dividends 141.6 144.9 2%

Share buybacks 88.8 64.9 (27%)

* Includes the increase of the Group number of employees and service contractors.

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).

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.

Directors’ Remuneration Report continued

87Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

As required under, and subject to the Companies Law, the appointments

of Daniel King, 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 two more 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 will end 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 Extraordinary General

Meeting 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 current remuneration is as detailed in

the 2021 AGM Notice as published on 25 March 2021. Further details

with respect to the decision of our Remuneration Committee and Board

to increase the remuneration of both cash and shares paid to our Chair,

subject to shareholders approval, are included in the Notice of the 2022

Annual General Meeting to be circulated by the Company to all share-

holders in due course.

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 two more three-year terms) but are

then restricted from becoming the Chair of the Board or holding any

paid role at the Company for two years after they leave the Board.

External board appointments

Where Board approval is given for an Executive Director to accept an

outside non-executive directorship, the individual is entitled to retain

any fees received. The Board assesses and confirms that such appoint-

ment 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

NEDs, 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 Thera-

peutics Inc., a NASDAQ publicly listed biotechnology company.

Anne Grim is currently a Non-Executive Director of Metro Bank Plc and

Insight Investment Management (subsidiary of Bank of New York Mel-

lon, 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

Ltd., an External Director of Extell Limited and a Non-Executive Director

of Emilia Development (O.F.G) Ltd.

Prof. Varda Liberman is currently an External Director of Cellcom Israel

Ltd. and Aquarius Engines (A.M) Ltd.

Non-Executive Director fees

The current annual fees for our presiding Non-Executive Directors are

as follows:

NAME ROLE FEE

Jacob A. Frenkel Chair £350,000

Anne Grim NED & SID, External Director £75,000

Daniel King NED, External Director £75,000

Steve Baldwin NED £75,000

Tami Gottlieb NED, External Director £75,000

Sigalia Heifetz NED £75,000

For further details with respect to the structure of the remuneration

paid to our Chair please refer to our 2021 AGM Notice published on 25

March 2021.

Further details with respect to the decisions of our Remuneration

Committee and Board to increase the fees paid to our presiding Non-

Executive Directors (and to approve the same fees to our newly appointed

Director, Prof. Varda Liberman) and to increase the fees paid to our

Chair, all subject to shareholders approval, are included in the Notice

of the 2022 Annual General Meeting to be circulated by the Company

to all shareholders in due course.

External advisors

From 17 November 2020 and during Q1 2021, and in respect of the

2020 Annual Report and 2021 Remuneration Policy, the Remuneration

Committee received independent advice from Korn Ferry LLC on the

Remuneration Policy review and market practice. Korn Ferry is a signa-

tory to the Remuneration Consultants’ Code of Conduct and has con-

firmed to the Committee that it adheres in all aspects to the terms of

the Code. The Remuneration Committee is satisfied that the advice

provided by Korn Ferry LLC in relation to remuneration matters is objec-

tive and independent.

In February 2022, the Committee appointed Ernst & Young Global

Limited (EY) as an independent advisor to carry out a detailed bench-

marking exercise in relation to the proposed increase in the remunera-

tion of Prof. Jacob A. Frenkel as an Independent Non-Executive

Director and Chair of the Board, to be voted on at the Company’s 2022

AGM. The Remuneration Committee is satisfied that the advice provided

by EY in relation to this remuneration matter is objective and independ-

ent.

88 Plus500 Ltd. 2021 Annual Report

Statement of voting on remuneration at 2021 meetings

The table below shows votes cast by proxy at the EGM held on 16 March 2021 and the AGM held on 4 May 2021 in respect of the Directors’

remuneration.

AGM RESOLUTIONS FOR % VOTES CAST AGAINST % VOTES CAST VOTE WITHHELD

Renew Remuneration Policy 53,681,868 94.46 3,150,107 5.54 337,200

Approve fees to Jacob Frenkel 57,154,752 99.97 14,603 0.03 –

Approve remuneration terms for David Zruia 48,829,840 85.42 8,336,335 14.58 3,000

Approve remuneration terms for Elad Even-Chen 55,226,737 96.61 1,939,438 3.39 3,000

Approve a tax bonus payment to Elad Even-Chen 31,678,733 55.24 25,670,302 44.76 –

Advisory vote – Approve the Directors’ Remuneration Report 33,930,938 59.17 23,413,830 40.83 4,267

EGM RESOLUTIONS FOR % VOTES CAST AGAINST % VOTES CAST VOTE WITHHELD

Approve fees to Tami Gottlieb 53,565,509 99.98 8,071 0.02 11,967

Approve increase in fees to Anne Grim 53,565,509 99.98 8,071 0.02 11,967

Approve fees to Sigalia Heifetz 53,565,509 99.98 8,071 0.02 11,967

Most highly remunerated executives in 2021

The table below shows the remuneration of the Company’s five most highly compensated executives in 2021 (including two Executive Directors):

NAME 2021 FEES ($)

Elad Even-Chen 2,633,136

David Zruia 2,445,808

Ari Shotland 1,856,978

Nir Zatz 1,558,037

Alon Cohen Naznin 1,169,652

Implementation of policy in 2022

2022 Executive Directors’ remuneration

In Q1 2021 the Remuneration Committee has continued its efforts to modify the remuneration arrangements of the Executive Directors to bet-

ter align executive compensation with UK governance standards followed by Main Market-listed companies and move further towards a struc-

ture in line with investor expectations and developments in best practice. The remuneration for Executive Directors for FY 2022 remained the

same as it was in FY 2021.

The Company’s new 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.

This report has been approved by the Board of Directors of Plus500 Limited.

Signed on behalf of the Board

Daniel King

Chair of the Remuneration Committee

22 March 2022

Directors’ Remuneration Report continued

89Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

The Directors of Plus500 present their report for the year ended 31 December 2021. 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 – 53 and on page 63.

Results and dividends Results for the year ended 31 December 2021 are set out in the financial and business review on pages 38 – 40 and

the Consolidated Statement of Comprehensive Income on page 98. Information regarding the final and special divi-

dends can be found in the financial review on page 40. Dividend payments made during the year ended 31December

2021 can be found in the notes to the Consolidated Financial Statements on page 115.

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 118.

At the close of business on 21 March 2022, the Company had 99,598,282 ordinary shares in issue, and an additional

15,290,095 ordinary shares are held in treasury by the Company.

Authority to purchase own shares

The Company has authority to purchase its own shares and a further authority will be sought at the upcoming

Annual General Meeting.

Directors’ interests Details of the Directors’ beneficial interests are set out in the Directors’ Remuneration Report on page 85.

Directors’ indemnities The Company has given indemnities to each of the Directors in respect of any liability arising against them in connec-

tion 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 2021.

Major interests in shares Notifiable major shares interests of which the Company has been made aware are set out on page 59.

Political contributions The Company did not make any donations to political organisations during the year.

Equality, Diversity & Inclusion policy

In December 2021 the Company reapproved and published on its website its policy on equality & diversity.

https://cdn.plus500.com/media/Investors/CorporateGovernance/EqualityDiversityAndInclusionPolicy.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 out-lined in note 25 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 – 11.

Auditors A resolution to reappoint Kesselman & Kesselman, a member firm of PricewaterhouseCoopers International Limited

as external auditors will be proposed at the 2022 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

90 Plus500 Ltd. 2021 Annual Report

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 81 to 86

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 2022

Directors’ Report continued

91Plus500 Ltd. 2021 Annual Report

Strategic Report Governance Financial statements

In addition, under the Companies Law, the entry by two or more share-

holders into a shareholders’ agreement, where such shareholders’

agreement will result in such shareholders holding in concert shares

in a company in an amount exceeding the thresholds set out above,

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 Com-

panies Law) and will have no rights whatsoever for so long as they are

held by the acquirer.

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 – Takeover 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.

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 incor-

porated 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 share

holder 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 disen-

franchised for purposes of voting on the merger. A merging company

must inform its creditors of the proposed merger. Any creditor of a party

to the merger may seek a court order blocking the merger, if there is a

reasonable concern that the surviving company will not be able to satisfy

all of the obligations of the parties to the merger. 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 Com-

panies 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.

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.

Corporate Law

92 Plus500 Ltd. 2021 Annual Report

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 knowl-

edge 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 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 Stand-

ards 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 Finan-

cial 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

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.

93Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

In this section

Independent Report

of the Auditors 94 – 97

Consolidated Financial

Statements in US Dollars ($)

Consolidated Statement

of Comprehensive Income 98

Consolidated Statement

of Financial Position 99

Consolidated Statement

of Changes in Equity 100

Consolidated Statement

of Cash Flows 101

Notes to the Consolidated

Financial Statements 102 – 125

FINANCIAL

STATEMENTS

For illustrative purposes

94 Plus500 Ltd. 2021 Annual Report

Independent Report of the Auditors

Plus500 Ltd. 2021 Annual Report

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

To the shareholders

of Plus500 Ltd.

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 2021 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 2021;

– 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

95Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

Plus500 Ltd. 2021 Annual Report

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

KEY AUDIT MATTER HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTER

REVENUE RECOGNITION

The Group has developed and operates an online and mobile trading platform

for trading Contracts for Difference (“CFDs”).

Trading income represents Customer Income, which mainly includes revenue

from CFD Customer Income (customer spreads and overnight charges), and

Customer Trading Performance, which includes gains/losses on customers’

trading positions, arising on client trading activity.

In respect of trading income generated from CFD, the Group has developed and

operates an online and mobile trading platform for trading CFDs. 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.

UNCERTAIN TAX PROVISIONS

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 2020

and 2021 were not 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.

96 Plus500 Ltd. 2021 Annual Report

Independent Report of the Auditors continued

Plus500 Ltd. 2021 Annual Report

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

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 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;

– 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.

Independent Report of the Auditors continued

97Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

Plus500 Ltd. 2021 Annual Report

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

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.

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 Maya Ben Shmuel.

Tel Aviv, Israel Kesselman & Kesselman

Certified Public Accountants (lsr.)

A member firm of

PricewaterhouseCoopers International Limited

Maya Ben Shmuel

Partner

Tel Aviv, Israel

22 March 2022

98 Plus500 Ltd. 2021 Annual Report

Consolidated Statement of Comprehensive

Income

Plus500 Ltd. 2021 Annual Report

Year ended 31 December

US dollars in millions

Note

2021 2020

Trading income

718.7 872.5

Selling and marketing expenses

279.8 315.4

Administrative and general expenses

54.3 43.5

Operating profit

384.6 513.6

Financial income

10.4 16.6

Financial expenses

8.6 6.9

Financial income, net

1.8 9.7

Profit before income tax

386.4 523.3

Income tax expense

75.8 23.2

Profit and comprehensive income for the year

310.6 500.1

Basic earnings per share (In US dollars)

3.06 4.71

Diluted earnings per share (In US dollars)

3.05 4.71

The accompanying notes are an integral part of the financial statements.

Consolidated Statement of Comprehensive

Income

99Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

Consolidated Statement of Financial Position

Plus500 Ltd. 2021 Annual Report

As of 31 December

US dollars in millions

Note

2021 2020

Assets

Non-current assets

Property, plant and equipment

2.6 2.5

Goodwill and other intangible assets, net

28.0 –

Right of use assets

5.6 6.0

Long-term other receivables

4.4 1.7

Total non-current assets

40.6 10.2

Current assets

Income tax receivable

– 6.1

Other receivables and others

32.7 10.0

Cash and cash equivalents

749.5 593.9

Total current assets

782.2 610.0

TOTAL ASSETS

822.8 620.2

Liabilities

Non-current liabilities

Lease liabilities (net of current maturities)

4.2 5.3

Share based compensation

0.3 1.8

Total non-current liabilities

4.5 7.1

Current liabilities

Share based compensation

7.3 7.4

Income tax payable

89.9 2.2

Other payables

41.7 22.8

Service suppliers

15.5 22.5

Current maturities of lease liabilities

2.0 1.6

Trade payables – due to clients

0.6 1.0

Total current liabilities

157.0 57.5

TOTAL LIABILITIES

161.5 64.6

Equity

Ordinary shares

0.3 0.3

Share premium

22.2 22.2

Cost of Company’s shares held by the Company

(207.5) (145.7)

Retained earnings

846.3 678.8

Total equity

661.3 555.6

TOTAL EQUITY AND LIABILITIES

822.8 620.2

David Zruia

Chief Executive Officer

Elad Even-Chen

Group Chief Financial Officer

Prof. Jacob A. Frenkel

Non-Executive Director and Chairman

Date of approval of the consolidated financial statements by the Company’s Board of Directors: 22 March 2022.

The accompanying notes are an integral part of the financial statements.

Registered Company number (Israel): 514142140

Consolidated Statement of Financial Position

100 Plus500 Ltd. 2021 Annual Report

100

Consolidated Statement of Changes in Equity

Plus500 Ltd. 2021 Annual Report

US dollars in millions

Ordinary

premium

Cost of

Company’s

shares held by

the Company

Retained

earnings Total

Balance at 1 January 2020

0.3 22.2 (57.0) 318.6 284. 1

Changes during the year ended 31 December 2020

Profit and comprehensive income for the year

– – – 500.1 500.1

Share based compensation

– – – 1.8 1.8

Transactions with shareholders:

Dividend

– – – (141.6) (141.6)

Issue of treasury shares to settle equity share based compensations

– – 0.1 (0.1) –

Acquisition of treasury shares

– – (88.8) – (88.8)

Balance at 31 December 2020

0.3 22.2 (145.7) 678.8 555.6

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

Transactions with shareholders:

Dividend

– – – (144.9) (144.9)

Issue of treasury shares to settle equity share based compensations

– – 3.1 (3.1) –

Acquisition of treasury shares

– – (64.9) – (64.9)

Balance at 31 December 2021

0.3 22.2 (207.5) 846.3 661.3

The accompanying notes are an integral part of the financial statements.

Consolidated Statement of Changes in Equity

101Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

101

Consolidated Statement of Cash Flows

Plus500 Ltd. 2021 Annual Report

Year ended 31 December

US dollars in millions

2021 2020

Operating activities:

Cash generated from operations (see Note 26)

383.0 546.6

Income tax received (paid), net

16.3 (23.1)

Interest received, net

6.2 5.2

Net cash flows provided by operating activities

405.5 528.7

Investing activities:

Acquisition of subsidiaries, net of cash acquired (see Note 23)

(32.5) –

Purchase of property, plant and equipment

(0.8) (0.3)

Net cash flows used in investing activities

(33.3) (0.3)

Financing activities:

Dividend paid to equity holders of the Company

(144.9) (141.6)

Payment of principal in respect of lease liabilities

(2.0) (1.8)

Acquisition of treasury shares

(64.9) (88.8)

Net cash flows used in financing activities

(211.8) (232.2)

Increase in cash and cash equivalents

160.4 296.2

Balance of cash and cash equivalents at beginning of the year

593.9 292.9

Gains (losses) from effects of exchange rate changes on cash and cash equivalents

(4.8) 4.8

Balance of cash and cash equivalents at end of the year

749.5 593.9

The accompanying notes are an integral part of the financial statements.

Consolidated Statement of Cash Flows

102 Plus500 Ltd. 2021 Annual Report

102

Notes to the Consolidated Financial

Statements

Plus500 Ltd. 2021 Annual Report

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 Contracts for Difference (“CFDs”) and share

dealing, as well as futures and options on futures. The Company has

developed and operates an online and mobile trading platform within

the CFD sector, enabling its international customer base of individual

customers to trade CFDs on over 2,500 underlying financial

instruments internationally. Additionally, the Company has developed

and operates a share dealing trading platform.

The Group’s offering is available internationally with main market

presence in the UK, Australia, the US, the European Economic Area

(“EEA”) 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 (as of February 2022) and the Financial

Services Agency (“FSA”) in Japan (as of March 2022).

The Company also has a subsidiary in Bulgaria which provides

operational services to the Group.

The Company has been listed since 2013. 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 of

the FCA and to trading on the London Stock Exchange Main Market

for listed securities.

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

2021 and 2020 and for each of the two years in the period ended on

31 December 2021 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 diversified geographically worldwide. As a consequence, the Board

of Directors of the Company (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).

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: CFD trading; share dealing; and futures and options on

futures. In the year 2021 the Group presents its operation as one

operating segment.

Notes to the Consolidated Financial

Statements

103Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

103

Plus500 Ltd. 2021 Annual Report

Note 2 – Summary of significant accounting

policies continued

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 changes 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 CFD Customer Income (customer spreads and

overnight charges), Non-CFD 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 CFDs 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).

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.

104 Plus500 Ltd. 2021 Annual Report

104

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

Note 2 – Summary of significant accounting

policies continued

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

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 25.

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.

Notes to the Consolidated Financial

Statements continued

105Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

105

Plus500 Ltd. 2021 Annual Report

Note 2 – Summary of significant accounting

policies continued

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 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 options 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.

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.

106 Plus500 Ltd. 2021 Annual Report

106

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

Note 2 – Summary of significant accounting

policies continued

t. Business combinations continued

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.

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

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.

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.

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.

Notes to the Consolidated Financial

Statements continued

107Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

107

Plus500 Ltd. 2021 Annual Report

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

2021 2020

European Economic Area (“EEA”)

329.0 365.3

United Kingdom

88.9 109.9

Australia

61.6 112.0

Rest of the World

239.2 285.3

718.7 872.5

Note 5 – Selling and marketing expenses

Year ended 31 December

US dollars in millions

2021 2020

Payroll and related expenses

21.4 18.0

Variable bonuses

8.8 4.8

Share based compensation

4.0 6.6

Commissions to media buying

20.7 16.9

Advertising and technology costs

151.4 204.2

Commissions to processing companies

40.8 53.0

Server and data feeds commissions

11.7 8.4

Other

21.0 3.5

279.8 315.4

Note 6 – Administrative and general expenses

Year ended 31 December

US dollars in millions

2021 2020

Payroll and related expenses

11.6 8.0

Variable bonuses

5.4 6.8

Share based compensation

7.7 6.6

Professional and regulatory fees

18.5 14.6

Depreciation and amortisation

2.5 2.3

Other

8.6 5.2

54.3 43.5

108 Plus500 Ltd. 2021 Annual Report

108

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

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

2021 2020

Employee benefits and other related expenses

58.9 50.8

IT and technology costs

38.2 55.3

Commissions to processing companies

40.8 53.0

Advertising, marketing and commissions to media buying

145.6 174.2

Professional and regulatory fees

18.5 14.6

Depreciation and amortisation

2.5 2.3

Other

29.6 8.7

334.1 358.9

In the years ended 31 December 2021 and 2020, IT and technology costs together with additional allocated other technological related costs

were $58.4 million and $70.3 million, respectively.

Note 8 – Auditors’ remuneration

Year ended 31 December

US dollars in millions

2021 2020

Audit of Plus500 Ltd.’s consolidated financial statements

0.3 0.2

Audit of Plus500 Ltd.’s subsidiaries

0.3 0.3

Total audit fees

0.6 0.5

Other assurance related services

0.3 0.1

Tax compliance services

0.7 0.2

Total non-audit fees

1.0 0.3

Total fees

1.6 0.8

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 dividends 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.

Notes to the Consolidated Financial

Statements continued

109Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

109

Plus500 Ltd. 2021 Annual Report

Note 9 – Share based compensation continued

2) The following table specifies the dates of grants and the grant rights as of each date

Grant date Vesting date

Share price

(GBP)*

Number of

rights granted*

Number of

employees

31 December 2019 31 December 2021

797.85 3,503 105

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

*Share price in GBP pence on grant date.

3) Cash settled share based compensation liability

As at 31 December

US dollars in millions

2021 2020

Current liability

7.3 7.4

Non-current liability

0.3 1.8

7.6 9.2

4) Cash settled share based compensation expenses

Year ended 31 December

US dollars in millions

2021 2020

Selling and marketing expenses

4.0 6.6

Administrative and general expenses

2.8 5.1

6.8 11.7

5) Cash settled share based compensation – number of rights outstanding

Number of rights

2021 2020

Opening balance as at 1 January

8,768 10,210

Rights granted

1,163

3,126

Rights vested

(3,208) (3,668)

Rights forfeited

(1,051) (900)

Closing balance as at 31 December

5,672 8,768

During 2021 and 2020, 3,208 and 3,668 rights were vested in total amount of $6.9 million and $8.6 million, respectively. The average vesting

price based on GBP pence per granted right was approximately $2,160 and $2,351, respectively.

110 Plus500 Ltd. 2021 Annual Report

110

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

Note 9 – Share based compensation continued

b. Equity settled share based compensation programmes

Background

The Group grants long-term incentive plans (“LTIPs”) to selected employees located outside of Israel and service contractors (the “LTIP Grants”).

The Group grants Restricted Stock Units (“RSUs”) to selected employees located in Israel (the “RSUs Grants”).

In respect of certain projects, the Group grants bonuses with a partial deferred element settled in ordinary shares of the Company to selected

service contractors and employees (the “Deferred Bonuses”).

During 2021 and 2020, the Group recognised $4.9 million and $1.5 million, respectively, as expenses in respect of the equity share based

compensation plans and Deferred Bonuses in the consolidated statement of comprehensive income as administrative and general expenses.

In 2020, an amount of $0.3 million was booked to retained earnings.

As of 31 December 2021 and 2020, retained earnings include an amount of $3.5 million and $1.7 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 2019 31 December 2021

1,370 15,259 1

1 January 2020 31 December 2022

886 75,627 7

1 January 2021 31 December 2023

1,450 122,496 7

*Share price in GBP pence on grant date.

The 2019 LTIP Grant was subject to service condition and was not subject to any additional KPIs or conditions. The 2019 LTIP Grant was

vested on 31 December 2021 and the Company issued 19,111 of its treasury shares.

The 2020 LTIP Grant is subject to service condition and additional KPIs as follows:

KPI % DESCRIPTION TYPE OF CONDITION

TSR 40% Subject to achieving the three-year FTSE 250 TSR target and calculated on a linear basis, with 30%

payable upon achievement of median TSR for FTSE 250 and 100% payable upon achievement of upper

quartile TSR for FTSE 250

Market

EPS 40% Subject to achieving the three-year compounded annual EPS growth rate and calculated on a linear

basis, with 30% payable upon achievement of 5% compounded annual EPS growth rate and 100%

payable upon achievement of 12% compounded annual EPS growth rate

Performance

HR 20% Subject to achieving HR criteria related to churn and growth of specific departments Performance

Notes to the Consolidated Financial

Statements continued

111Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

111

Plus500 Ltd. 2021 Annual Report

Note 9 – Share based compensation continued

b. Equity settled share based compensation programmes continued

The 2021 LTIP Grant is subject to service condition and additional KPIs as follows:

KPI % DESCRIPTION TYPE OF CONDITION

TSR

20%

Subject to achieving the three-year TSR target and calculated on a linear basis, with 25% payable upon

achievement of median TSR for bespoke group and 100% payable upon achievement of median TSR

for bespoke group plus 10% per annum

Market

TSR

10%

Subject to achieving the three-year TSR target and calculated on a linear basis, with 25% payable upon

achievement of median TSR for FTSE 250 and 100% payable upon achievement of upper quartile TSR

for FTSE 250

Market

EPS

30%

Subject to achieving EPS target, as set by the Board Performance

Strategic

20%

Subject to achieving strategic objectives, as set by the Board and related to growth through M&A,

new products and new markets

Performance

Operational

20%

Subject to achieving operational objectives, as set by the Board and related to customer growth

and people objectives

Performance

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 of

1 January 2021 and 2020, less the accumulated amount of dividends paid in cash 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 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 grant, as adjusted for dividends.

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) RSU Grants

The following table specifies the dates of RSU 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

886 116,045 8

1 January 2021 31 December 2023

1,450 160,926 8

*Share price in GBP pence on grant date.

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”).

112 Plus500 Ltd. 2021 Annual Report

112

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

Note 9 – Share based compensation continued

b. Equity settled share based compensation programmes continued

In respect of the RSUs granted on 1 January 2020, the employees are entitled to the RSUs upon completing a three-year service period in

addition to KPIs as follows:

KPI % DESCRIPTION TYPE OF CONDITION

TSR 40% Subject to achieving the three-year FTSE 250 TSR target and calculated on a linear basis, with 30%

payable upon achievement of median TSR for FTSE 250 and 100% payable upon achievement of upper

quartile TSR for FTSE 250

Market

EPS 40% Subject to achieving the three-year compounded annual EPS growth rate and calculated on a linear

basis, with 30% payable upon achievement of 5% compounded annual EPS growth rate and 100%

payable upon achievement of 12% compounded annual EPS growth rate

Performance

HR 20% Subject to achieving HR criteria related to churn and growth of specific departments Performance

In respect of the RSUs granted on 1 January 2021, the employees are entitled to the RSUs upon completing a three-year service period in

addition to KPIs as follows:

KPI % DESCRIPTION TYPE OF CONDITION

TSR

20%

Subject to achieving the three-year TSR target and calculated on a linear basis, with 25% payable upon

achievement of median TSR for bespoke group and 100% payable upon achievement of median TSR

for bespoke group plus 10% per annum

Market

TSR

10%

Subject to achieving the three-year TSR target and calculated on a linear basis, with 25% payable upon

achievement of median TSR for FTSE 250 and 100% payable upon achievement of upper quartile TSR

for FTSE 250

Market

EPS

30%

Subject to achieving EPS target, as set by the Board Performance

Strategic

20%

Subject to achieving strategic objectives, as set by the Board and related to growth through M&A, new

products and new markets

Performance

Operational

20%

Subject to achieving operational objectives, as set by the Board and related to customer growth and

people objectives

Performance

During 2021, 19,870 and 12,560 RSUs were forfeited in respect of the 2020 and 2021 grants, respectively.

On the vesting date, the employees shall be entitled to a cash payment equal to the aggregate dividends paid in cash to shareholders 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 2019 and 2020 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 dividends.

The 2021 Deferred Bonuses shall be 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 shall be calculated based on the ordinary share price on grant

date, as adjusted for dividends.

Notes to the Consolidated Financial

Statements continued

113Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

113

Plus500 Ltd. 2021 Annual Report

Note 9 – Share based compensation continued

b. Equity settled share based compensation programmes continued

Grant date Vesting date

Share price

(GBP)*

Number of

ordinary shares

on grant date

Number of

employees and

service contractors

1 January 2019 31 December 2019

1,370 13,834 2

1 January 2020 31 December 2020

886 56,298 2

1 January 2021 31 December 2021

1,450 53,904 2

*Share price in GBP pence on grant date.

On 31 December 2021 and 2020, the Company issued 5,780 and 5,280 of its treasury shares, in accordance with the Deferred Bonuses plan of

2019. On 31 December 2021, the Company issued 24,434 of its treasury shares, in accordance with the Deferred Bonuses plan of 2020. On 31

December 2021, the Company issued 58,062 of its treasury shares, in accordance with the Deferred Bonuses plan of 2021. The Company

recognised the value of the issued shares on 31 December 2021 according to the fair value measured for each plan on 1 January 2019, 1

January 2020 and 1 January 2021, respectively.

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 (subject to the receipt in advance of a valid certificate from the Israel Tax

Authority (“ITA”) allowing for a reduced tax rate).

a. Company taxation in Israel

The full corporate tax rate in Israel for the years 2021 and 2020 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 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 2020 and 2021.

As a result, the Company’s corporate tax rate for the years 2021 and 2020 is 12%.

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 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 receipt in advance of a valid certificate from the

ITA allowing for a reduced tax rate (see Note 27).

In July 2020, the Company received approximately $47.0 million rebates (including interest) reflecting the reduced tax rate for FY 2018. 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.

114 Plus500 Ltd. 2021 Annual Report

114

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual 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 periods in which such determination is made.

c. Corporate taxation in subsidiaries

Principal tax rate

Subsidiary 2021 2020 Tax regulation

19% 19%

Tax laws in United Kingdom

12.5% 12.5%

Tax laws in Cyprus

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

The deferred income taxes relate mainly to payroll and related expenses of the share based compensation plans (see Note 9). The deferred tax assets

were computed in 2021 and 2020 at tax rates of 23% and 12%, respectively.

e. Taxes on income included in the consolidated income statement for the reported years

Year ended 31 December

US dollars in millions

2021 2020

Current taxes:

Current taxes in respect of current year’s profits

77.6 78.7

Tax income in respect of previous years

0.5 (55.1)

78.1 23.6

Deferred income taxes:

Change of deferred tax assets (see d above)

(2.3) (0.4)

Taxes on income expenses

75.8 23.2

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 (Note 10a above) and the actual tax expense:

Year ended 31 December

US dollars in millions

2021 2020

Income before taxes on income, as reported in the consolidated income statement

386.4 523.3

Theoretical tax expense in respect of this year’s income – at 23%

88.9 120.4

Less tax benefits arising from preferred technological income in respect of the current year

(4.3) (33.8)

Decrease in taxes resulting from different tax rates applicable to foreign subsidiaries

(0.8) (0.5)

Impact of change in tax rates on deferred tax balances and temporary differences

(2.8) 0.3

Decrease in taxes in respect of currency differences and expenses not deductible for tax purposes

(5.7) (8.1)

Tax income in relation to previous years

0.5 (55.1)

Taxes on income for the reported period

75.8 23.2

Notes to the Consolidated Financial

Statements continued

115Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

115

Plus500 Ltd. 2021 Annual Report

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.

31 December

2021 2020

Profit attributable to equity holders of the Company (US dollars in millions)

310.6 500.1

Weighted average number of ordinary shares in issue*:

Basic

101,456,641 106,086,540

Dilutive effect of equity share based compensation

529,601 212,352

Diluted

101,986,242 106,298,892

Basic earnings per share (in US dollars)

3.06 4.71

Diluted earnings per share (in US dollars)

3.05 4.71

*After weighting the effect of the 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

2020

5,584,528 88.8 £12.66

2021

3,406,211 64.9 £13.90

During the years ended 31 December 2021 and 2020, the Company issued 179,537 and 5,280 of its treasury shares, respectively, in accordance

with the various share based equity settled compensation grants (see Note 9).

During the period starting 1 January 2022 and up to 21 March 2022, as the latest practicable date before the signing date of the consolidated

financial statements (see Note 27), the Company purchased an additional 626,498 ordinary shares (or 0.5%) in the capital of the Company for

an aggregate purchase amount of $12.0 million pursuant to these share buyback programmes. The ordinary shares were bought back at an

average price of £14.25.

Note 13 – Dividends

The amounts of dividends and the amounts of dividends per share for the years 2021 and 2020 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

12 February 2020

40.6 0.3767 13 July 2020

11 August 2020

101.0 0.9531 11 November 2020

17 February 2021

84.9 0.8292 12 July 2021

17 August 2021

60.0 0.5921 11 November 2021

On 15 February 2022, the Company declared a final dividend and a special dividend in the amounts of $37.8 million and $22.2 million,

respectively (see Note 27).

* 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.

116 Plus500 Ltd. 2021 Annual Report

116

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

Note 14 – Other receivables and others

As of 31 December

US dollars in millions

2021 2020

Securities

18.2 –

Prepaid expenses

5.2 6.6

Other

9.3 3.4

32.7 10.0

As of 31 December 2021 and 2020, the total amount of prepaid expenses includes prepaid expenses related to the Company’s sponsorship

agreements (see Note 21).

As of 31 December 2021, the fair value amount of the securities was $18.2 million.

All the financial assets included among current assets are for relatively short periods. Therefore, their fair values approximate or are identical

to their carrying amounts.

Note 15 – Property, plant and equipment

Composition of assets, grouped by major classifications and changes therein in 2021 is as follows:

US dollars in millions

Computers and

office equipment

Leasehold

improvements

Other Total

Cost

Balance at beginning of year

2.0 3.8 0.3 6.1

Additions

0.6 0.2 - 0.8

Balance at end of year

2.6 4.0 0.3 6.9

Accumulated depreciation

Balance at beginning of year

1.6 1.9 0.1 3.6

Additions

0.2 0.4 0.1 0.7

Balance at end of year

1.8 2.3 0.2 4.3

Depreciated balance as of 31 December 2021

0.8 1.7 0.1 2.6

Depreciated balance as of 31 December 2020

0.4 1.9 0.2 2.5

Note 16 – Cash and cash equivalents

Cash and cash equivalents by currency of denomination:

As of 31 December

US dollars in millions

2021 2020

USD

728.0 543.3

EUR

181.2 250.7

GBP

68.1 91.2

AUD

54.0 90.0

ILS

20.8 18.1

Other

47.4 69.5

Gross cash and cash equivalents

1,099.5 1,062.8

Less: segregated client funds

(350.0) (468.9)

Own cash and cash equivalents

749.5 593.9

Notes to the Consolidated Financial

Statements continued

117Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

117

Plus500 Ltd. 2021 Annual Report

Note 17 – Other payables

As of 31 December

US dollars in millions

2021 2020

Payroll and related expenses

24.6 19.0

Accrued expenses

16.4 3.6

Other

0.7 0.2

41.7 22.8

The financial liabilities included among other payables are for relatively short periods. Therefore, their fair values approximate or are identical

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 identical to their

carrying amounts.

Note 19 – Trade payables – due to clients

As of 31 December

US dollars in millions

2021 2020

Customers’ deposits, net*

350.6 469.9

Segregated client funds

(350.0) (468.9)

0.6 1.0

* Customers’ deposits, net are comprised of the following:

Customers’ deposits

428.3 507.2

Less – financial derivative open positions:

Gross amount of assets

(130.4) (123.8)

Gross amount of liabilities

52.7 86.5

350.6 469.9

*The total amount of ‘Trade payables – due to clients’ includes bonuses to clients.

Note 20 – Leases

The Group has real estate lease agreements.

a) Right of use assets:

Real estate leases

US dollars in millions

At 1 January 2020

5.3

Additions

2.4

Amortisation

(1.7)

At 31 December 2020

6.0

Additions

2.7

Disposals

(0.6)

Modification

(0.7)

Amortisation

(1.8)

At 31 December 2021

5.6

118 Plus500 Ltd. 2021 Annual Report

118

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

Note 20 – Leases continued

b) Lease liabilities:

Real estate leases

US dollars in millions

At 1 January 2020

5.7

Additions

2.4

Interest expense

0.2

Lease payments

(1.8)

Exchange differences

0.4

At 31 December 2020

6.9

Additions

2.7

Disposals

(0.7)

Interest expense

0.2

Lease payments

(2.0)

Modification

(0.9)

Exchange differences

–

At 31 December 2021

6.2

Note 21 – Commitments

a. The Company and Club Atlético de Madrid, S.A.D. (“Atlético Madrid”) entered into a sponsorship agreement on 3 October 2017 under which

the Company is entitled to advertise and promote itself as the main sponsor of Atlético Madrid for the 2018/19, 2019/20 and 2020/21

seasons. On 24 April 2020 the Company and Atlético Madrid signed an extension of the agreement for the season 2021/22.

b. 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.

c. 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.

d. 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.

Note 22 – Share capital

Composed of ordinary shares of NIS 0.01 par value, as follows:

Number of ordinary shares

as of 31 December

2021 2020

Authorised

300,000,000 300,000,000

Issued and fully paid

114,888,377 114,888,377

Less treasury shares*

(14,663,597) (11,436,923)

Outstanding shares

100,224,780 103,451,454

*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

119Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

119

Plus500 Ltd. 2021 Annual Report

Note 23 – Goodwill and other intangible assets, net

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 (together, the “Acquisition”). The

Acquisition consideration was funded from the Company’s existing cash balances and was paid on completion.

Due to the timing of the transaction closing date, the fair values assigned to assets acquired and liabilities assumed are preliminary, based on

management’s estimates and assumptions and may be subject to change as additional information is received. The Company expects to

finalise the valuation as soon as practicable, but not later than one year from the Acquisition date. According with the purchase price allocation,

Goodwill and other intangible assets, net, comprises of: Licence of $24.2 million, Customer relationships of $1.9 million, Technology of $0.2

million and Goodwill of $1.7 million.

The assets and liabilities recognised as a result of the Acquisition are as follows:

US dollars in millions

Cash

0.5

Other receivables

6.0

Long-term other receivables

0.4

Service suppliers

(0.3)

Other payables

(1.6)

Goodwill and other intangible assets, net

28.0

Net assets acquired

33.0

From the Acquisition date and up to 31 December 2021, the acquired business contributed approximately 1% out of the total Group revenues

for the year ended on 31 December 2021.

No impairment was recorded as of 31 December 2021.

Note 24 – 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 payables):

As at 31 December

US dollars in millions

2021 2020

Related party and key management liability

11.6 13.6

c. Expenses to related parties and key management:

Year ended 31 December

US dollars in millions

2021 2020

Payroll and related expenses and service fees (Selling and marketing expenses)

6.6 7.1

Payroll and related expenses and service fees (Administrative and general expenses)

10.0 13.5

Non-executive Directors fees (Administrative and general expenses)

1.1 0.6

The average number of key management personnel during the year was 21 (FY 2020: 23).

120 Plus500 Ltd. 2021 Annual Report

120

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

Note 25 – Financial risk management

The Group operates in the fields of CFDs and share dealing, as well as futures and options on futures. In the field of CFDs, the Group engages

only with individual clients and offers CFDs 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

a 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

The management of the Group deems this risk as the highest risk the Group incurs.

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 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 clients can trade.

These limits are determined based on the Group clients’ trading levels, volatilities and the market liquidity of the underlying financial product or

asset class and represent the maximum long and short client exposure that the Group will hold without hedging the net client exposure.

The Group’s real-time market position monitoring system is intended to allow it to continually monitor its market exposure against these limits.

If exposures exceed these limits, the Group either hedges or new 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 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 CFDs 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.

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 Risk &

Regulatory Committee.

Daily profit on closed positions:

US dollars in millions

2021 2020

Highest profit

16.0 76.9

Highest loss

(3.9) (20.9)

Average

1.9 2.4

Notes to the Consolidated Financial

Statements continued

121Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

121

Plus500 Ltd. 2021 Annual Report

Note 25 – Financial risk management continued

a. Market risk continued

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 1% 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:

As of 31 December

US dollars in millions

2021 2020

EUR

(0.1) (0.5)

AUD

(0.1) (0.9)

GBP

(0.1) 0.1

ILS

(1.0) –

The exposure in respect of balances denominated in other currencies is immaterial.

b. Credit risk

The Group operates a real-time mark-to-market trading platform with customers’ profits and losses being credited and debited automatically

to their accounts.

Under the Group's policy, customers cannot owe the Group funds when losing more than they have in their accounts, all customer accounts

are pre-funded.

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 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 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 2021 and 2020, counterparties holding the Group’s cash and cash equivalents, credit cards, client funds and deposits, have

credit ratings as follows:

Credit rating*

2021 2020

AA+ to AA-

21% 27%

A+ to A-

73% 46%

BBB+ to B+

2% 25%

Remaining counterparties

4% 2%

* The financial institutions were rated by the same third party.

122 Plus500 Ltd. 2021 Annual Report

122

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

Note 25 – Financial risk management continued

b. Credit risk continued

As of 31 December 2021 the amounts held by the remaining counterparties are held in several banks worldwide. The balance in each of those

banks does not exceed 2% (2020: 1%) 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 2021 was $240.1 million or 22% of the exposure to all banks (2020:

$217.1 million or 20%).

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.

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 (“Pillar 1”) and its own assessment of capital

required to support all material risks throughout the business (“Pillar 2”). The UK Subsidiary manages its regulatory capital through an Internal

Capital Adequacy Assessment Process (known as the ICAAP) in accordance with guidelines and rules implemented by the FCA. Both Pillar 1

and Pillar 2 assessments are compared with total available regulatory capital on a daily basis and monitored by the management of the Group.

As at 31 December 2021 and 2020, the UK Subsidiary had £43.9 million and £41.8 million, respectively, of regulatory capital resources, which

is in excess of both its regulatory capital requirement (Pillar 1) and the internally measured capital requirement (Pillar 2).

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 Process (“ICARA”) 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 position remains always above the

minimum regulatory thresholds. As of 31 December 2021 and 2020, the regulatory capital of the CY Subsidiary was €90.4 million and

€71.7 million, respectively, which is in excess of both its regulatory capital requirement (Pillar 1) and the internally measured capital requirement

(Pillar 2).

As of the 26 of June 2021, the capital adequacy and overall risk management requirements that applied to the Company, 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 2021 and 2020, Pillar 1 Capital Adequacy ratio was 174.1% and 111.8% respectively. Moreover, the Group is evaluating

its overall risk profile and capital position through its internal capital adequacy assessment process, which is performed at least on an

annual basis.

Notes to the Consolidated Financial

Statements continued

123Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

123

Plus500 Ltd. 2021 Annual Report

Note 25 – Financial risk management continued

e. Capital Management continued

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 2021 and 2020, the AU Subsidiary held NTA of AUD 38.2 million and AUD 33.2 million, respectively, of regulatory capital,

which is in excess of its NTA requirements from ASIC, FMA and FSCA.

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 2021 and 2020, the SG Subsidiary held regulated capital of SGD 8.3 million and SGD 7.8 million, respectively, of regulatory

capital, which is in excess of its MAS requirements.

5) Plus500IL

The IL Subsidiary is regulated by the 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 2021 and 2020, the IL Subsidiary held regulated capital of $11.2 million and $10.2 million, respectively, of regulatory capital,

which is in excess of its ISA requirements.

6) Plus500SEY

The SEY Subsidiary is regulated by the 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.

7) Cunningham Commodities

Cunningham Commodities is a Futures Commission Merchant (“FCM”) and is registered with CFTC and a member of the NFA.

As at 31 December 2021, the Cunningham Commodities Subsidiary had adjusted net capital of $22.0 million, which is in excess of CFTC

Regulation 1.17 and the minimum capital requirements of the CME Group Inc.

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) (level 2).

These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on e

ntity specific

estimates. Since all significant inputs required for the fair value estimations of the said instruments are observable, the said instruments are

included in level 2.

124 Plus500 Ltd. 2021 Annual Report

124

Notes to the Consolidated Financial

Statements continued

Plus500 Ltd. 2021 Annual Report

Note 25 – Financial risk management continued

g. Fair value estimation continued

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 26 – Cash generated from operations

Year ended 31 December

US dollars in millions 2021 2020

Cash generated from operating activities

Net income for the year

310.6 500.1

Adjustments required to reflect the cash flows from operating activities:

Depreciation and amortisation

0.7 0.6

Amortisation of right of use assets

1.8 1.7

Lease modification

(0.2) –

Liability for share based compensation

6.8 11.7

Settlement of share based compensation

(8.4) (5.2)

Equity share based compensation

4.9 1.8

Taxes on income

75.8 23.2

Interest expenses in respect of leases

0.2 0.2

Exchange differences in respect of leases

– 0.4

Interest income

(6.2) (5.2)

Foreign exchange losses (gains) on operating activities

4.3 (8.3)

79.7 20.9

Operating changes in working capital:

Decrease (increase) in other receivables and others

(16.9) 1.9

Increase (decrease) in trade payables due to clients

(0.4) 0.8

Increase (decrease) in other payables

17.3 10.4

Increase (decrease) in service suppliers

(7.3) 12.5

(7.3) 25.6

Cash generated from operating activities

383.0 546.6

Notes to the Consolidated Financial

Statements continued

125Plus500 Ltd. 2021 Annual Report

Strategic Report Financial statementsGovernance

125

Plus500 Ltd. 2021 Annual Report

Note 27 – Subsequent events

In January 2022, the Company’s status as a Preferred Technological Enterprise (“PTE”), as accredited by the ITA under the tax regime in Israel,

has been extended for the years 2022, 2023, 2024, 2025 and 2026 (see Note 10).

In February 2022, the Group obtained an operating licence in Estonia, granted by the Estonian Financial Supervision Authority (“EFSA”).

On 15 February 2022, the Company declared a final dividend in an amount of $37.8 million ($0.3777 per share). The dividend record date is

25 February 2022 and it will be paid to the shareholders on 11 July 2022.

On 15 February 2022, the Company declared a special dividend in an amount of $22.2 million ($0.2218 per share). The dividend record date is

25 February 2022 and it will be paid to the shareholders on 11 July 2022.

On 15 February 2022, the Company declared the adoption of a share buyback programme to buy back an amount of up to $55.0 million of the

Company’s ordinary shares, comprised of a regular new share buyback programme in the amount of $25.2 million and a special share buyback

programme in the amount of $29.8 million.

In March 2022, the Company completed the acquisition of 100% of the issued and outstanding share capital of EZ Invest Securities Co., Ltd., a

Type 1 Financial Instruments Business Operator regulated by the Financial Services Agency in Japan. This acquisition was funded from the

Company’s existing cash balances, with a non-significant consideration amount.

Further information

Sponsor and Broker

Liberum Capital Limited

Ropemaker Place

25 Ropemaker Street

London EC2Y 9LY, UK

Independent Auditors

Kesselman & Kesselman, a member

firm of PricewaterhouseCoopers

International Limited

146 Derech Menachem Begin Street

Tel Aviv 6492103,

Israel

Financial PR

MHP Communications

60 Great Portland Street

London W1W 7RT, 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

The latest Plus500 news, share price, financial documents

and more can be found on our investor site:

Advisors

Stay up to date

Plus500.com