Admiral Markets AS Public offering of subordinated bonds Investor presentation December 2017
Disclaimer This presentation has been prepared in connection with the public offering and listing of the subordinated bonds of Admiral Markets AS. The presentation in not the prospectus and does not include all information relevant for a potential about the bonds and the issuer. The Prospectus for the public offering and listing of the bonds has been registered by the Estonian Financial Supervision Authority under the number 4.3-4.2/3060 and can be found on the webpage of Admiral Markets AS (www.admiral.ee)*. This presentation should be read in conjunction with the prospectus. Any decision to invest in the Bonds should be based on consideration of the prospectus as a whole by the Investor. Nothing in this document shall be treated as a representation or warranty as to the profitability of the investments into the Company. Nothing contained herein is, or may be relied upon as, a promise, representation or guarantee as to the future performance or policies of the Company or as to any other circumstances that may or may not occur in the future. Nothing in this document constitutes an offer or invitation by or on behalf of the Company to invest into the Company. By receiving this document, you accept and acknowledge that no special relationship of trust or duty whatsoever exists that would require updating the information herein and confirm that you are not relying upon any such special relationship of trust or duty (including but not limited to under Article 1048 of the Estonian Law of Obligations Act, in Estonian: V õ la õ igusseadus). Neither this document nor any information contained herein shallbe treated as legal, financial or tax advice of any kind. Nothing in this document shall be construed as the giving of investment advice by the Company or any other person. You should take independent advice from qualified professional advisors before making investment decision(s). An investment in the bonds is a subject to a number of risks that should be considered before making an investment decision. The information provided in this presentation does not provide a complete overview of the issuer ’ s business, the terms and conditions of the bonds, or the risks specific to the bonds and the issuer. Always refer to the prospectus before making any investment decision. *Webpage www.admiral.ee directs to the public offering homepage 2
Executive summary Admiral Markets AS (hereinafter also “ the Issuer ” ), a part of the international online brokerage group Admiral Markets Group AS ( “ Admiral Markets ” ), is announcing a public bond offering. Admiral Markets, established and headquartered in Tallinn, Estonia has expanded its reach to become a truly global company. Its subsidiaries, investment firms, serve clients in 90+ countries. Admiral Markets offers its customers online trading in Forex and other financial markets with currency pairs and a wide range of derivatives (mostly contracts for difference, CFDs). The Issuer is licensed by the Estonian Financial Supervision Authority to provide cross border brokerage services as an investment firm in the 28 Member States of the EU, and in three EEA countries: Iceland, Norway and Liechtenstein. There are three other regulated investment firms in Admiral Markets Group: in the UK, Cyprus and Australia. Investors are offered 10 year unsecured subordinated bonds with a coupon rate of 8% Bond offering The proceeds of the offering will be used to strengthen the regulative capital of the Issuer to support its fast growth. The Issuer is applying for the bonds to be listed on the Nasdaq Baltic Bond List 3 For a full overview about the Issuer and the Issue, please refer to the offering prospectus: www.admiral.ee
Definitions Contract for difference (CFD) – a tradable derivative contract under which gains or losses of the parties are settled through cash payments rather than by the delivery of physical goods or securities. CFD agreements offer investors the possibility to trade with high leverage. CFDs can be used for both long and short positions. Investment firm – a company whose permanent activity is the provision of investment services or the performance of investment activities on a professional basis. Investment firms are under the supervision of financial supervision authorities in many countries (including EU countries). Investment firms usually have higher capital requirements than regular legal entities. Liquidity provider – a market participant acting as both the buyer and seller of a particular security to profit on the bid-ask spread. In derivative markets the liquidity providers have an important risk management role as they allow the market participants to hedge their (excess) open positions. 4
Table of contents Admiral Markets 6 The Issuer 17 Financial Performance 24 Bond Issue 29 Contact 32
Admiral Markets is a group of companies offering online trading in Forex and other financial markets with currency pairs and derivatives on precious metals, stocks, commodities, indices and cryptocurrencies. Our strong dedication to state-of-the-art software and quality assurance means that our clients receive the best, most transparent trading experience. 6
Admiral Markets at a glance 23 M 90+ 24,000 200 EUR Active trading accounts Employees Net income from trading Markets Physical presence in 16 24,000 active trading 200 motivated professionals, Almost 23 M EUR of net countries, serving customers accounts, which have 119 of which are working at income from trading in 2016 from 90+ countries executed at least one trade in the Issuer, Admiral Markets while Admiral Markets AS, the last 12 months AS, as of 30.06.2017 Issuer, made nearly 18 M EUR 7 Source: Audited annual reports for the financial year 2016 and unaudited interim reports for the six months up to 30.06.2017 of the Issuer and Admiral Markets Group AS
Why Admiral Markets? Having a physical presence in its most important markets enables Admiral Markets to get to know its Global presence clients personally, understand them better and offer them a better service. Admiral Markets enables trading with the local and the best-known instruments in each of its main Flexible trading accounts markets. Deposits to trading accounts can be made in most national currencies. Multiple trading accounts in different currencies are allowed to protect client ’ s capital from currency fluctuations. Admiral Markets helps its customers to make thoughtful and intelligent trading decisions by publishing Education and analytics books and offering educational programmes (seminars, live webinars, videos), designed to teach trading skills and explain the financial markets. Admiral Markets ’ servers are located at LD4 Equinix Datacenter, UK, right next to all major liquidity Security and software providers, ensuring the best execution and the lowest latency. It also offers the most reliable and popular trading platform, MetaTrader 5. Country offices with local experts in all key markets. Local knowledge, support, seminars and many other Local support elements allow a closer personal relationship with customers. Support via phone and live chat in more than 20 languages. 8
Awards 9
Instruments CFDs on stocks - 64 stocks from 56 currency pairs, including pairs NYSE (29), Nasdaq (9), Euronext with numerous exotic currencies (11), Xetra (12), BME (3) e.g. South African Rand, New Stocks – 65 stocks from USA & Zealand Dollar Europe 8 CFDs on commodities, including 5 metals - gold (USD and AUD), CFDs on stock indices - 16 stock silver, platinum, palladium (all in indices and 2 index futures USD) and 3 energies - Brent, WTI oil, natural gas (all in USD) CFDs on 5 cryptocurrency pairs with fiat currencies - Bitcoin, CFDs on bond futures - 2 bond Ethereum, Ripple, Litecoin and indices (Bund ,10Yr T-Note) Bitcoin Cash 10
Trading platforms Admiral Markets is an online trading provider, i.e. all customer transactions, including trading and money transfers, are served through online channels. It has developed a two-layer service channel for the customers – The Trader ’ s Room platform for account and money management and (2) Meta Trader for online trading. Meta A popular online trading platform, MT4 An app used by clients to register, open Trader 4 developed by MetaQuotes Supreme Edition accounts, manage deposits and Software, a long term ally of withdrawals, amend personal Admiral Markets. Admiral Markets Meta information and submit documents for MT4 Trader ’ s Room contributes to the development of Trader 5 the identification of clients. Also includes Web Trader the platform by testing the platform a billing system and single log-on service and can therefore offer new to all the services offered by Admiral versions to customers long before MT5 MT5 Markets. they arrive to market. Supreme Edition Mobile 11
Major markets Europe Other markets 12
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