FLOW TRADERS REPORTS STRONG 2015 RESULTS

For immediate release

FLOW TRADERS REPORTS STRONG 2015 RESULTS

Amsterdam, the Netherlands, 24 February 2016 - Flow Traders N.V. today announced strong results for 2015, as it successfully capitalized on higher volatility and increased trading volumes in the market compared to 2014. In the year in which Flow Traders successfully debuted on Euronext Amsterdam, Net Trading Income grew by 76 percent, while ETP Market Value Traded grew by 23 percent, compared to 2014. This reflects the strategy of Flow Traders of growing the business incrementally while maintaining the desired low risk profile, controlling costs, and securing the right talent. In 4Q15 we realised a solid result despite meaningfully lower trading volumes and volatility compared to 3Q15.

4Q15 Key Highlights^[1]

• ETP Market Inflow in 4Q15 was €109 billion versus €76 billion in 3Q15 (+43%). This was the highest registered quarterly capital inflow in 2015, with most inflow in Developed Markets Equity (source: BlackRock).
• ETP Market Value Traded fell from €3,993 billion to €3,423 billion (-14%, source WFE, LSE). In line with market developments, ETP Value Traded by Flow Traders came in at €144 billion in 4Q15 versus €171 billion in 3Q15 (-16%)
• Net Trading Income 4Q15 was €64.5 million versus €92.8 million in 3Q15 (-30%)
• Adjusted^[2] EBITDA Margin came in at 48% in 4Q15 versus 52% in 3Q15
• Adjusted Net Profit came in at €29.8 million in 4Q15 versus €37.9 million in 3Q15, following a decrease in Net Trading Income. The impact was dampened by a lower effective tax rate than anticipated 

Full Year 2015 Key Highlights

• Total ETP Market Value Traded grew from €9.95 trillion in 2014 to €14.30 trillion in 2015 (+44%)
• Total ETP Value Traded by Flow Traders increased from €527 billion in 2014 to €645 billion in 2015 (+23%)
• Net Trading Income increased from €172.7 million in 2014 to €304.7 million in 2015 (+76%)
• Revenue Capture 2015 came in at 4.7 bps versus 3.3 bps in 2014 (+44%), positively impacted by some periods of higher volatility during the year
• Flow Traders was trading at over 95 markets and provided liquidity in over 3,000 ETPs end 2015
• Adjusted EBITDA Margin increased to 51.5% in 2015 from 48.7% in 2014 due to further efficiency improvements, a predictable cost base and leveraging of our existing operations and infrastructure
• Adjusted Net Profit increased by 89% from €68.1 million in 2014 to €128.4 million in 2015 (Net Profit of €97.3 million adjusted for one off IPO expenses)
• Capital base further improved in 2015, with sufficient headroom above our required regulatory capital mainly as a result of our highly cash-flow generative business
• Dividend proposal will be €1.50 total dividend per share for 2015. Interim dividend paid was €0.50, final dividend proposal will be €1.00
• Headcount increased from 211 FTEs at year-end 2014 to 268 FTEs at year-end 2015

Dennis Dijkstra, Co-CEO of Flow Traders commented: "2015 was a very successful and important year for Flow Traders; in markets with certain periods of higher volatility and higher volumes, our Net Trading Income over the full year increased by 76% (€305 million in 2015 versus €173 million in 2014) and Adjusted Net Profit increased by 89% (€128 million in 2015 versus €68 million in 2014). The company's listing on Euronext Amsterdam was a key public event for the company. It reflects our ambitions going forward and increases our visibility with institutional counterparties, regulators, investors, and prospective employees. Our goal for 2016 remains to continuously improve our business, improve our pricing power and grow organically."

Sjoerd Rietberg, Co-CEO of Flow Traders commented: "As expected, the 4Q15 figures showed a decrease compared to 3Q15, reflecting the lower ETP values traded overall in the global market, a result of limited volatility. Driven by lower volumes traded and limited spikes in volatility, our Revenue Capture decreased to 4.5 basis points in 4Q15 from 5.4 basis points in 3Q15. Nevertheless, overall in 2015, our ETP Value Traded grew 23% year-on-year, while our Net Trading Income grew by 76%. This boost in results was predominantly a result of improvements in our pricing knowledge and in our trading systems as well as periods of higher volatility in the markets and a continuing trend of strong inflows on the ETP market. The global ETP markets noted record inflows of €319 billion in 2015 compared to €245 billion in 2014 (+30% YoY). This confirms the momentum in the ETP space and confirms our strategy going forward."

Quarterly and FY Results

In 4Q15 markets were not as active as we had seen in the previous quarters. Adjusted EBITDA Margin decreased to 48% over 4Q15 compared to 52% over 3Q15, driven mainly by lower Net Trading Income and an increase in other employee costs due to recruitment costs and an increase in FTEs from 252 to 268 globally. Overall, Adjusted EBITDA Margin came in at 51% in 2015.

In Europe the ETP Market Value Traded decreased from €238 billion in 3Q15 to €216 billion in 4Q15
(-9%), which was mainly driven by periods of lower volatility and lower volumes. Although Flow Traders' ETP Value Traded decreased from €104 billion in 3Q15 to €91 billion, overall Value Traded by Flow Traders rose 45% in 2015, year on year.

In the Americas the ETP Market Value Traded came in at €2.98 trillion in 4Q15, compared to €3.33 trillion in 3Q15 (-11%), following lower volatility and a more reserved stance from investors towards year end. ETP Value Traded by Flow Traders decreased by 8%, as a result of the improvements of our pricing models in combination with changes in IT-products. 

Due to the market circumstances in China, leading to relative high volumes in 3Q15, the ETP Market Value Traded decreased from €422 billion in 3Q15 to €225 billion in 4Q15. ETP Value Traded by Flow Traders also decreased from €20 billion in 3Q15 to €10 billion in 4Q15. However, due to late benefits following the market turmoil in China, our Revenue Capture increased from 11.5bps in 3Q15 to 18.3 bps in 4Q15.

Other

The proposed sale of a non-core part of our communications infrastructure did not materialize in the fourth quarter. Management is currently investigating other options. No material financial impact is expected.

Current Trading and Outlook

So far trading at the beginning of 2016 has been solid and showed to date some improvements of results versus 4Q15. Flow Traders reiterates that it expects for the medium to long term to continue to grow organically and at a faster pace than the global ETP AuM. Flow Traders will continue to focus on increasing traded volumes and improving Revenue Capture. This will be done by continuously improving our pricing, our technological infrastructure and our risk management systems while at the same time continuing to strengthen our team. 

Financial Calendar

18 March                       Publication Annual Report 2015
4 May                           1Q16 results
19 May                         AGM Flow Traders
20 May                         Ex-dividend date

Analyst Conference Call and Webcast

There will be an analyst conference call on the results at 10:00 am CET on Wednesday 24 February 2015. The presentation will also be accessible live via audio webcast at www.flowtraders.com. A replay of the conference call will be available on the company website for at least 90 days.

Home Member State

Flow Traders N.V.'s home Member State is the Netherlands.

Contact Details
Flow Traders N.V.
Serge Enneman / Manager Investor Relations
Phone:   +31 20 7996799
Email:     Investor.relations@flowtraders.com

Important legal information

This press release is prepared by Flow Traders N.V. and is for information purposes only. It is not a recommendation to engage in investment activities and you must not rely on the content of this document when making any investment decisions. The information in this document does not constitute legal, tax, or investment advice and is not to be regarded as investor marketing or marketing of any security or financial instrument, or as an offer to buy or sell, or as a solicitation of any offer to buy or sell, securities or financial instruments.

The information and materials contained in this press release are provided 'as is' and Flow Traders N.V. or any of its affiliates ("Flow Traders") do not warrant the accuracy, adequacy or completeness of the information and materials and expressly disclaim liability for any errors or omissions. This press release is not intended to be, and shall not constitute in any way a binding or legal agreement, or impose any legal obligation on Flow Traders. All intellectual property rights, including trademarks, are those of their respective owners. All rights reserved. All proprietary rights and interest in or connected with this publication shall vest in Flow Traders. No part of it may be redistributed or reproduced without the prior written permission of Flow Traders.

This press release may include forward-looking statements, which are based on Flow Traders' current expectations and projections about future events, and are not guarantees of future performance. Forward looking statements are statements that are not historical facts, including statements about our beliefs and expectations. Words such as "may", "will", "would", "should", "expect", "intend", "estimate", "anticipate", "project", "believe", "could", "hope", "seek", "plan", "foresee", "aim", "objective", "potential", "goal" "strategy", "target", "continue" and similar expressions or their negatives are used to identify these forward-looking statements. By their nature, forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors because they relate to events and depend on circumstances that will occur in the future whether or not outside the control of Flow Traders. Such factors may cause actual results, performance or developments to differ materially from those expressed or implied by such forward-looking statements. Accordingly, no undue reliance should be placed on any forward-looking statements. Forward-looking statements speak only as at the date at which they are made. Flow Traders expressly disclaims any obligation or undertaking to update, review or revise any forward-looking statements contained in this press release to reflect any change in its expectations or any change in events, conditions or circumstances on which such statements are based unless required to do so by applicable law.

Financial objectives are internal objectives of Flow Traders to measure its operational performance and should not be read as indicating that Flow Traders is targeting such metrics for any particular fiscal year. Flow Traders' ability to achieve these financial objectives is inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond Flow Traders' control, and upon assumptions with respect to future business decisions that are subject to change. As a result, Flow Traders' actual results may vary from these financial objectives, and those variations may be material.

Efficiencies are net, before tax and on a run-rate basis, i.e. taking into account the full-year impact of any measure to be undertaken before the end of the period mentioned. The expected operating efficiencies and cost savings were prepared on the basis of a number of assumptions, projections and estimates, many of which depend on factors that are beyond Flow Traders' control. These assumptions, projections and estimates are inherently subject to significant uncertainties and actual results may differ, perhaps materially, from those projected. Flow Traders cannot provide any assurance that these assumptions are correct and that these projections and estimates will reflect Flow Traders' actual results of operations.

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