CORPORATE PRESENTATION - FLATEXDEGIRO AG | SEPTEMBER 2021-1
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-1 FLATEXDEGIRO AG | SEPTEMBER 2021 CORPORATE PRESENTATION
0 At a glance
flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Investment highlights
1 4
First, largest and fastest growing pan-European Fully fledged online bank (no brick and mortar
discount broker, well-positioned to consolidate a branches) with full German banking license & EU
highly fragmented market passport, a scalable proprietary core banking
system and clear cost leadership
2 5
Benefiting from near-term market volatility as well Homegrown, scalable and recently modernized IT
as long-term secular trends that are increasing the infrastructure with more than EUR 30 million
addressable market invested over last three years
3 6
Best-in-class product portfolio and highly Entrepreneurial, top interdisciplinary management
competitive pricing drive impressive customer team that is significantly invested in the business
growth and leading positions in several European
countries
1
flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
flatexDEGIRO at a glance
Leading European online broker serving highly active private investors and traders in 18 countries. Operating under German banking license with EU passport
enhances customer monetization and provides ancillary services to core online brokerage business
Key Operating Metrics H1 2021 Revenue Model and Contribution
Number of Number of exchanges Executed Return on
Customers and OTC-partners trades(LTM) Tangible Equity
1.75m >60 >90m >70%
Credit Book Average Interest Rate Balance Markets
(collateralized) (Loan Book) Sheet Equity
~EUR 1.1bn >3% p.a. ~EUR 450m 18 countries
Executed Trade Securities Customer Employees Online brokerage
Volume under Custody Cash Deposits
Credit and treasury
IT services
>EUR 275bn ~EUR 38bn ~EUR 3bn ~1,000
2
flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Strong sustainable growth of customers and transactions..
Number of brokerage Average transactions per Number of transactions
customers (million) customer/year (million)
75
73
1.25
62
58
52
0.80 46
37
0.60
30 31
0.46 26
20
0.32
16
0.24
2015 2016 2017 2018 2019 2020 2015 2016 2017 2018 2019 2020 2015 2016 2017 2018 2019 2020
Note: all numbers are pro-forma
3
flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
..results in exceptionally strong financials..
Revenues Adjusted EBITDA Operating Cashflow
(EUR million) (EUR million) (EUR million)
CAGR +45% CAGR +63% CAGR +169%
261 114 141
132
125
43
38 46
19
2018 2019 2020 2018 2019 2020 2018 2019 2020
4
flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
..which further accelerated in H1 2021
Number of Brokerage Number of Transactions Revenues (EUR million) &
Customers (million) (million) Adj. EBITDA margin
+74% +41% +127%
+41% 75.0
1.75 261.5
226.1 **
54.0 53.0
1.25
1.11
1.01 164.8
37.6
H1/21
99.8 47.6%
FY/20
H1/20
43.6%
45.4%
Jun Sep Dec Jun H1/20* 9M/20* FY/20* H1/21 H1/20 9M/20 FY/20 H1/21
2020* 2020 2020 2021
* pro forma
** only including approx. 10% of Mifid II conform inducements
5
Business model
6
flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Fastest growing online brokerage with excellent risk-return profile
• Fastest growing online brokerage business in Europe with over 1.25m
retail clients doing 75m transactions in 2020
• Most trading-active client pool in the brokerage market (2-3 times the
Market Leader with High average of direct peers*)
Value Clients • Dedicated brokerage offering with focused marketing strategy
minimizes operating expenses (cost per client acquisition less than EUR
50 vs. EUR 300-500 CPA at competitors)
• Only major bank-independent broker with German banking license and European
passport
Fully Independent Platform • Full value chain under one roof, thus highly scalable platform with significant
and Banking License operational leverage
• Homegrown core banking system with outstanding expertise in transaction banking
• Brokerage agency only with no “black swan risks” (WTI, SFR unpeg) due to no
Excellent Risk Profile market making, no trading book and no trading liquidity risk
• Positively geared to volatility with natural profit hedge to downturns
* Source: Company, competitor and market data
7
flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Our competitive edge: the triple “P”
• Top notch product offering including equities, bonds, ETPs, ETFs and
mutual funds
Product • Market leading ETP offering of Goldman Sachs, Morgan Stanley,
Société Générale, UBS, BNP Paribas, HSBC, Vontobel and other products
• Trading platform only – no research, recommendation or intelligence – avoiding
regulatory administration and costs
• Operating one of the most secure and stable IT platforms with uptime of > 99.9% in
Platform 2020
• Economies of scale: each additional trade reduces cost per trade settlement –
internal cost per trade down > 40% from EUR 1.44 (2019) to ~EUR 0.80 (2020)
• Unlimited trading possibilities with attractive pricing model and price leadership
in most markets – regardless of type of asset (stocks, bonds, ETPs, ETFs, etc.) and
Pricing transaction amount
• Competitive technology edge due to self-developed, highly scalable security
execution/settlement infrastructure ensures sustainable cost leadership
8flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Lead in Offering: ‘next 3.0’ - from pull to push
Sneak preview
Convenience
Value
Ubiquity
9flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
High level of recurring revenues
• High level of recurring revenues generated by loyal and sticky customer base
Maturity profile of our • Exceptionally strong customer growth particularly in 2020 and first half of 2021
trading customers has driven up relative share of trading educated new customers
4%
27% Trades by
customer onboarding
46% Actual year (Y0)
2020
29%
2014* Y-1 to Y-2
67%
> Y-2
28%
* excluding DEGIRO
10flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Winning the “right” customers
• > 50% of customers in the most sustainable and attractive age bucket of 25-44
years
flatex grows in customers in • Age structure very favourable compared to German average (where less than 35%
their best investment age are in that most attractive age bucket)
• Despite growth no change in customer structure from 2019 (outer circle) to 2020
flatex customer
structure vs
German average
26% 18-24 years -5%
German
17% flatex 25-34 years 10%
average* Germany
2020 2020 35-44 years 10%
17%
45-54 years -5%
55-64 years -2%
27%
65+ years -6%
* Based on representative study done by „Aktion pro Aktie“ in August 2020
Note: outer circle 2019, inner circle 2020 11flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Vast majority trades frequently but not heavily
• > 90% of customers with max 6 trades per month
Composition of trades • High share of frequent trades (stock and ETF saving schemes)
• Buy/Sell ratio of ~ 1.5
> 90%
up to 3 trades/month
3-6 trades/month
2020
6-10 trades/month
more than 10 trades/month
12flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
High share of classic assets with high profitability
• flatexDEGIRO’s trading mix has shifted towards more profitable & stable products
(cash equities) and away from highly levered OTC products (CFDs and FX)
Composition of trades
• Significant absolute increase of highly profitable ETP business based on strong
partnership models
10%
8%
Shares & Bonds
29%
37% ETPs
2014* 14% 2020 ETFs & Funds
33%
Commodities / FX / CFDs
2% 68%
* excluding DEGIRO
13flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
90x lifetime return on CAC investment..
Average lifetime customer value (gross revenues) in relation to acquisition costs, EUR
• Low customer acquisition costs • High loyalty and stickiness • Superb scalability of busines
driven by secret sauce online result in sustainably low model with strong operating
marketing and brand size historic churn rates of < 5% leverage of 85+%
benefits (PR & word of mouth)
~215x
~ 7,500
~90x
Payback period:
~ 3,000
~ 2 months
~ 300
~ 35
Customer Annual revenue Discounted Customer Customer lifetime value
acquisition cost per client lifetime value @9% undiscounted (CLTV)
(CAC) (DCLTV)
14flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
..with outstanding and increasing ROIs.
Cohort 2018 Cohort 2019 Cohort 2020 Cohort H1/2021
CAC
New customers (gross) in k 162 213 561 531
Marketing expenses in EUR m 10.9 16.0 28.0 17.9
Customer acquisition costs in EUR per customer 67 75 50 34
Trades
Trades in H1 2021 in m 4.3 5.7 18.5 13.8*
Average trades per customer (basic H1 2021) 26 27 33 26
Annualised average trades per customer (basic H1 2021) 53 53 66 52
Commission income
Commission income in H1 2021 in EUR m 15.6 20.7 56.4 32.9*
Average commission income per customer in EUR 97 97 101 62
Annualised average commission income per customer in EUR 194 194 201 124**
ROI
Return on Investment p.a. 288% 259% 402% 368%
Break-even in months 4.2 4.6 3.0 3.3
* FY extrapollation
** Due to substantial growth in markets with market leading fees and 15
limited zero-fee offers for new customers in GermanyflatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Collateralized credit products provide profitable revenue
contribution at minimized risk profile
~€3bn of customer cash deposits @ zero cost of funding*
Generated >€55m of annualised revenues in H1 2021
Credit Treasury & ECB deposits
B2C brokerage credit book Non-brokerage credit book
A (margin loans) B (niche portfolio) C Treasury D ECB Deposits
Fully collateralized i.a. with Fully collateralized with credit Pass-through to clients due to
Fund investments, Simple products
customers' securities default insurances current negative ECB rates
Scalable with B2C growth Opportunistic and strategic niches Short-duration (Growth drivers
17flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
flatexDEGIRO – size, speed and dedication
• Realization of our European
growth strategy
• Largest pan-European retail
online broker in 18 countries
Cost and innovation
1
•
leadership with complete
#
75m trades
value creation in-house
in 2020
• Improved and more
extensive range of products
and venues for both brands
• Faster, cheaper and with
lower operating risk than
competitors
18flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Massive customer potential in Continental Europe..
Underdeveloped G7 Developed brokerage markets
Addressable
285m 111m
population
Digitalized 89% 97%
Online banked 55% 86%
Online brokerage 8% (23m people) 35% (40m people)
Massive structural gap between developed
(35%) and “underdeveloped G7” markets (8%)
in online brokered population.
Source: company estimate, statista
19flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
..driven by strong secular trends..
"
A new generation with no negative bias: „What is the DotCom bubble?“
Increasing digitization:
! „I can invest and manage my wealth on my mobile phone.“
#
Negative interest environment: „Saving accounts don‘t generate capital gains.“
⛵
Tax-incentivized saving schemes: „Will the existing penison schemes survive the next 30 years?“
Listed household brands: “I can invest easily in companies that I like and use.“
20flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
..allows for two-folded growth..
285m people Addressable population
Assuming penetration levels of
100m customers market developed markets (35%)
Existing Future new
online brokerage customers online brokerage customers
flatexDEGIRO > 5% >55 yearsflatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
..supported by unfair advantage due to low
costs and high scalability of our setup.. Netherlands:
Comparing a local stock transaction of €1,000 / CHF1,000 DEGIRO €2.30 | Binck €8.00
without special conditions or campaign. Customer advantage:
63%
Switzerland:
France:
DEGIRO CHF 5.50 | Swissquote CHF 20.00
DEGIRO € 0.40 | Boursorama € 6.00
Customer advantage:
Customer advantage:
73%
93%
Italy:
Portugal:
DEGIRO € 1.00 | Fineco € 19.00
DEGIRO € 1.00 | Banco Invest € 6.75
Customer advantage:
Customer advantage:
95%
85%
Spain:
DEGIRO € 2.50 | BBVA € 12.80
Customer advantage:
80% 22flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
.. while growing an exceptionally high-value customer base..
Size of bubble indicating number of trades executed in 2020
Average trades per customer in 2020
90
80
70
60
50
flatexDEGIRO
1
Nordnet
40
Comdirect Bourse
direct
30
Avanza
20 Fineco
10 Swissquote Hargreaves Lansdown
0
-5% 5% 15% 25% 35% 45% 55% 65%
Customer growth in 2020
1 Comdirect: Trading activity based on 9M/2020 figures
23flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
..at outstanding pace.
Company Geographical Net new %Growth 2020 Customers 2020 Net new Custo- %Growth Customers
focus Customers 2020 mers H1 2021 H1 2021 June 2021
flatexDEGIRO Europe +450k 56% 1.25m +506k 41% 1.75m
Nordnet Nordics +308k 34% 1.22m +254k 19% 1.48m
Avanza Nordics +304k 31% 1.28m +238k 21% 1.52m
comdirect Germany +230k 15% 1.80m - - [1.80m]
Hargreaves
UK +220k 17% 1.50m - - [1.50m]
Lansdown
ING DiBa Germany +210k 15% 1.64m - - [1.64m]
consorsbank Germany +160k 9% 1.33m - - [1.33m]
AJ Bell UK +62k 27% 0.30m +56k 18% 0.37m
Swissquote Swirzerland +51k 14% 0.41m - - [0.41m]
Bourse direct France +45k 27% 0.21m +21k 10% 0.23m
Fineco Italy +12k 1% 1.35m +34k 3% 1.40m
Peer average 17% 14%
Source: company data for publicly listed companies, press releases and news articles for non-listed companies
24Next chapter of growth
25flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
~ 4 x customer base … 3 x trading volume
CAGR +30% CAGR +20%
7-8m
250-350m*
90-110m
2.0-2.2m
2021(e) 2026(e) 2021(e) 2026(e)
* in a year with low market volatility
26flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Why we believe in upcoming market growth
Global %
Switzerland
- flatex/DEGIRO 3.0 On-site custody accounts
- Support of secular trends by will accelerate growth
increasing marketing in the industry !
France (estimated Q1 2022)
PEA accounts will
accelerate growth
(estimated Q1 2022)
$
Italy
Starting marketing
penetration
" (estimated
Portugal Q4 2021 / Q1 2022)
Tax service for clients will
accelerate growth
(estimated Q1 2022)
#
Spain
Tax service for clients will
accelerate growth
(estimated Q1 2022)
27flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Revenue opportunity of up to EUR 1.5bn p.a.
up to EUR 1.5bn
CAGR +20-25%
1
EUR 261m
up to €1.25bn
incremental revenue
2019 2020 2021(e) 2026(e)
1 DEGIRO not included in 2019 and only 5 months consolidated in 2020
28flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Profitable growth results in profitability growth
1
Adjusted EBITDA margin
Doubling profitability
29% 44% 48% >60%
2019 2020 H1/2021 2026(e)
1 adjusted for long-term incentive plan
29flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Capital Allocation
• Invest in markets
Organic growth • Invest in platform and products
investments • Maintain sustainable
capitalization
• High quality sector targets or
verticalization
Sensible
• Opportunities that accelerate
acquisition
expected generation of strategy
customer growth, expand
product offering or improve
> EUR 1.5bn
technological set-up
in accumulated Balanced • Potential share buybacks
especially during inviting
capital return
Operating Cash Flow market environment
2022-2026
30flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Our 2026
outlook 7-8m 250-350m
Extending our position Customers Minimum Transactions
1
as Europe's leading
€1.5bn >60%
online broker.
Revenue (up to) Adjusted EBITDA Margin
2
>€1.5bn
Accumulated Operating
Cash Flow (2022-2026)
1 In a year of low market volatility
2 Adjusted for long-term incentive plan 31Annex
32flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Our management board
Frank Niehage has vast experience across all segments of
retail and commercial banking, working as Managing Director at
Goldman Sachs until August 2014 when he joined flatexDEGIRO
AG. In previous positions, he was instrumental in the growth of
Bank Sarasin AG as CEO in Germany. Prior to this he had
served in various senior positions at Commerzbank, Credit
Suisse, UBS and international law firm Beiten Burkhardt, both in
Germany and internationally, especially in Asia. Frank is an
attorney at law in Germany and has received his Master of Laws
majoring in international economics from the University of
Houston Law Center.
Before joining flatexDEGIRO AG in 2015, Muhamad Said
Chahrour was CFO at Lamudi, one of Rocket Internet SE’s core
ventures, and primarily responsible for the financial funding and
investor relations of the global entities. He previously worked in
M&A and Transaction Services at UBS and pwc. Muhamad has a
strong track record of excellent work results and exceptional
expertise and experience across the sectors of corporate finance,
credit and investment management, and business development.
Muhamad holds a Master of Science degree in quantitative
finance from the University of Bath School of Management.
Frank Niehage, LL.M. Muhamad Said Chahrour, M.Sc.
Chief Executive Officer (CEO) Chief Financial Officer (CFO) flatexDEGIRO AG,
flatexDEGIRO AG & flatexDEGIRO Bank AG Chief Executive Officer (CEO) DEGIRO,
Managing Director flatexDEGIRO Bank AG
33flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Diversity at work – our success is based on the competence,
commitment and flexibility of our team
Half
tech-rockstars, 1/3
half
under 30
non-tech-
rockstars
45 1/3
nationalities female
Flexible
15% working
partime well before
Covid
34flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
ESG status
Key achievements Next steps
• First non-financial statement/ • Apply for memberships/participation:
sustainability report published UN Principles for Responsible Banking
• United Nations Global Compact joined (PRB), Climate Neutral Now; Net-Zero
in April 2021 Banking Alliance; UNEP Finance
• Measures launched to reduce CO2 Initiative (UNEPP FI)
emissions (switch to natural electricity, • Introduce a software-supported ESG
electrification of vehicle fleet, etc.) management system
• Active communication with all well- • Publish additional or
known rating agencies started (MSCI, supplementations to existing ESG-
ISS-ESG, Sustainalytics, S&P) relevant guidelines
• In cooperation with providers of • Introduce a reporting system in
sustainable investment funds, online accordance with GRI standard
seminars on sustainable investment • Make ESG products much more
are provided for our customers. visible to our customers by adding
• ESG-relevant topics included as a ESG-relevant rating information to in-
regular component of the Group’s app search functionalities
Governance Committee
35flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
flatexDEGIRO AG - our shareholder structure
12.9% GfBK Gesellschaft für
Börsenkommunikation mbH
5.2% Heliad Equity Partners
1.4% Bernd Förtsch
67.2% free float 109.7m 7.5% KipEi B.V.
free float includes 4% shares
held by management
incl. exercised options outstanding*
5.8% Nola B.V.
* excluding additional approx. 1.3m management options exerciseable over the next three years
36flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Our stock – a continuing success story on the capital market
SHARE PRICE DEVELOPMENT LTM
05/07/2021
29.05 €
30 EUR
31/08/2021
22.00 €
20 EUR
10/08/2020
9.33 €
10 EUR
0 EUR
Aug-20 Oct-20 Dec-20 Feb-21 Apr-21 Jun-21 Aug-21
Shares outstanding: 109,704,548
Stock covered by:
Options outstanding: approx. 1.3m
August 2021 August 2021 August 2021
Market capitalisation: EUR 2.4 bn (as of 2021-09-03)
PT EUR 40.00 PT EUR 36.50 PT EUR 24.00
Buy Buy Hold
SDAX
Listed: Regulated market / PRIME Standard /
Frankfurt Stock Exchange
August 2021 August 2021 August 2021
PT EUR 35.00 PT EUR 35.25 PT EUR 37.50
Buy Buy Buy ISIN: DE000FTG1111
Bloomberg: FTK GR Equity
37flatexDEGIRO CORPORATE PRESENTATION SEPTEMBER
Financial calendar 2021
Financial Publications 2021
9 November 2021 Interim Management Statement Q3/2021
Investor Conferences 2021
September 2021 Berenberg/Goldman Sachs, German Corporate Conference
November 2021 DZ Bank, Equity Conference
December 2021 Berenberg, Pennyhill
3839
Contact
Achim Schreck flatexDEGIRO AG
Head of IR and Corporate Communications
Mobile: +49 160 92774570 Address: Rotfeder-Ring 7
Phone: +49 69 450001 1700 60327 Frankfurt/Main, Germany
Mail: achim.schreck@flatexdegiro.com Website: www.flatexdegiro.com
flatexDEGIRO AG
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