Operational highlights of the unaudited financial results for the fourth quarter and the full year ended December 31, 2020
- Total revenue in the fourth quarter was HK$1,186.4 million, an increase of 281.6% year-on-year (“YoY”), achieving a YoY triple-digit growth for four consecutive quarters.
- For the full year 2020, Futu Holdings’ total revenues increased by 211.9% YoY to HK$3,310.8 million, and Non-GAAP adjusted net income[1] increased 651.1% YoY to HK$1,364.0 million.
- The number of users reached 11.9 million, an increase of 58.6% YoY; the number of clients reached 1,419,734, an increase of 97.8% YoY; the number of Futu’s paying clients reached 516,721, an increase of 160.5% YoY.
- During the period, the trading volume of Futu US stocks ballooned to HK$783.6 billion, surpassing the US$100 billion milestone for the first time, accounting for 65% of the total trading volume.
Futu Holdings Limited (“Futu” or the “Company”) (NASDAQ: FUTU), a leading tech-driven online brokerage and wealth management platform, announces its unaudited financial results for the fourth quarter (“Q4” or the “Period”) and full year ended December 31, 2020.
During the period, total revenues reached HK$1,186.4 million, an increase of 281.6% YoY, the fourth consecutive quarter of a YoY triple-digit growth. Non-GAAP adjusted net income was up 10.2 times year-over-year to HK$552.9 million. Brokerage commission and handling charge income increased 373.8% YoY to HK$718.3 million, interest income increased by 163.2% YoY to HK$336.9 million, and other income (including wealth management, enterprise services, etc.) increased by 317.8% YoY to HK$131.2 million.
For the full year of 2020, Futu’s total revenues increased by 211.9% YoY to HK$3,310.8 million. It recorded a non-GAAP adjusted net income of HK$1,364.0 million, an increase of 651.1% YoY.
As of the end of 2020, the total number of users reached 11.9 million, an increase of 58.6% YoY; the number of registered clients increased 97.8% YoY to 1,419,734; the number of paying clients increased 160.5% YoY to 516,721. In the fourth quarter, the Company added 98,632 paying clients on a net basis; the number of paying clients in Hong Kong increased by 260% YoY, setting a record high quarterly since listing, and achieving triple-digit year-on-year growth for four consecutive quarters.
As of December 31, 2020, total client assets reached HK$285.2 billion, a YoY increase of 227.3%. While the number of clients is growing rapidly, the client retention rate continued to be maintained at a high level of 98% in 2020. In the fourth quarter, clients’ active trading activity was also further propelled, as Daily Average Revenue Trades (DARTs) increased 339.9% YoY to 462,261.
US stocks business spikes, quarter trading volume exceeded 100 billion US dollars
During the period, Futu’s total trading volume increased 438.1% YoY to HK$1,210.0 billion, in which trading volume for US stocks was HK$783.6 billion, marking a new milestone of exceeding US$100 billion, and accounting for 65% of the total trading volume. Futu has therefore further consolidated its position as a leading one-stop global investment APP.
Being the one-stop investment platform that integrates investment transactions, up-to-date news, real-time market data, and trading community interaction, Futu has become the preferred platform for portfolio diversification among global investors. From market accessibility perspectives, and after years of endeavor in R&D, Futu was the first online brokerage to offer users free Level 2 market data for US stocks. Futu’s extended trading hour service enabled clients to capture investment opportunities with ease. Meanwhile, Futu News is one of the few platforms providing 24/7 US market updates, where global financial news and stock analysis are all at users’ fingertips. Further propelled by an active investment community wherein tens of millions of users seamlessly exchange thoughts and ideas to help make informed investment decisions, Futu’s US stock business continues to thrive.
Multiple licenses covering extensive areas, enters Singapore market to further expand international presence
Futu is committed to extending its licenses and qualifications in widening its product and service offerings. During the period, Futu gained approval on providing grey market services to intermediaries on the basis of the “Provide Automated Trading Services (Type 7) License” from SFC, enabling Futu to become the upstream provider of grey market trading services and offering other brokerages access to Futu’s self-developed grey market system. Futu also obtained the Singapore Capital Markets Services (CMS) License in the fourth quarter. Futu Holdings’ subsidiaries have held 35 financial licenses and qualifications in Hong Kong, the United States, Singapore as well as Europe, with footholds across major financial markets worldwide.
With its edges expanding via multiple license acquisition, Futu is vigorously advancing its internationalization strategy. In the first quarter of 2021, Futu officially entered the Singapore market, providing local investors with a seamless one-stop online trading experience, and bridging them to major global financial markets. In support of its international expansion, Futu will continue to ramp up its marketing and further strengthen its presence in the US market.
Mr. Leaf Hua Li, Futu’s Founder, Chairman, CEO & Chairman of the Technology Committee, said: “Futu sees Singapore as the key market for expansion next. Being well-positioned as the financial hub in Southeast Asia, Singapore provides a cohesive environment for FinTech development, serving as a pivot for Futu to expand our footprints to other SEA countries. We hope to establish a presence in Singapore with the provision of unparalleled investment experience to local users. Indeed, the market structure of Singapore and Hong Kong is similar. Both share the similar advantages of being an international financial center, situated within the same time zone and having dense populations. I am confident that we can make a difference in Singapore by leveraging on the successful experience we earned from the Hong Kong market.”
Enterprise Services continues to grow in prominence, helping 100+ companies listed in Hong Kong and the US
As the preferred Internet brokerage for listing on the US and Hong Kong markets, Futu’s Enterprise Services business brand, FUTU I&E, continued to be the go-to enterprise service partner. During the period, it helped numerous companies including MINISO, Lufax, Yatsen Holding, Blue Moon and JD Health successfully land in the US and Hong Kong stock markets. Futu I&E has provided IPO distribution services and investor relations services for 105 companies. Aggregating over ten million high-quality users with ample client assets, and diversified interaction design, Futu is leading the next-generation of IR services which allow companies to precisely promote their investment values to targeted audiences in an effective manner. 22 companies featured on the Futu HK$10bn+ Subscriptions IPO Roster as of year end 2020.
In the fourth quarter, Futu I&E’s ESOP option management clients accumulated to 159, including industry leaders across various industries such as healthcare & medical, consumer & retail, automotive & logistics, and TMT, namely RemeGen, POP MART, Xpeng Motors and KE Holdings Inc. By providing new economy and traditional enterprises with one-stop ESOP management services from planning, trust and taxation services, data management and exercise, Futu I&E has become the preferred one-stop ESOP services provider for leading companies among different sectors.
Seamlessly integrated wealth management and trading accounts, Money Plus’s AUM marks HK$10 billion benchmark
For its wealth management business, Money Plus has undergone a brand refresh during the period. Total client assets in Money Plus was HK$10.2 billion, highlighted with a cumulative total return of over HK$300 million for clients. As of the end of 2020, a total of nearly 110,000 clients have purchased Futu Money Plus’s fund products. As of the fourth quarter, Money Plus has established partnerships with 39 asset managers around the world, which altogether hosted 39 live-streaming sessions on the Futubull platform in 2020 to conduct fund publicity and investor education.
With rising numbers of clients leveraging on fund products to capture opportunities from equity markets, wealth management positions held continued to grow. Among them, equity fund themes, including Greater China, technology and new energy, were highly sought by clients. Augmented by dedicated in-house research efforts in picking selected funds, multiple funds available on Futu’s platform recorded over 100% returns in 2020, generating considerable returns for clients.
