XTB (XTB) Q2 2021 TU earnings summary

Executive summary

• H1 2021 net profit was PLN 65.2m, down 77.8% YoY; operating income fell 53.3% to PLN 241.9m as trading profitability declined from the exceptional H1 2020 base.

• Client acquisition reached a record 107,854 new clients, up 105.7% YoY, while average active clients rose 101.6% to 105,005.

Financial highlights

• H1 operating expenses increased to PLN 164.0m from PLN 138.3m YoY; EBIT was PLN 77.9m versus PLN 379.9m, and net profit was PLN 65.2m versus PLN 293.5m.

• Q2 operating income was PLN 55.2m versus PLN 186.7m in Q1; Q2 EBIT was a loss of PLN 21.9m and net loss was PLN 23.9m.

• Marketing expense rose to PLN 58.1m from PLN 39.0m YoY; commission expense rose to PLN 17.8m from PLN 10.5m.

Outlook and guidance

• FY21 operating costs may be ~12% higher than 2020; marketing spending may increase by more than 20%, depending on expansion, campaign effectiveness and revenue conditions.

• 2021 client-acquisition ambition is at least 120,000; 10,000 new clients were added in the first 25 days of July.

• Dividend recommendations are intended to range from 50% to 100% of standalone annual net profit, subject to capital, regulatory and operating needs.