GROUP STRATEGY DAY 2021 THE NEW ERA OF BROKERAGE flatexDEGIRO KEY MESSAGE THE NEW ERA OF BROKERAGE
Key Message
Philosophy Hypergrowth We allow our customers to shape their financial We will continue to grow faster than the market, by 1 future by retailizing capital market access. We don‘t 4 clients, trades, customer satisfaction, service quality follow trends, we set them. and products and thus revenues.
Diligence Profitability We are focused and dedicated to provide an We run a highly scalable business model where our 2 outstanding online brokerage platform while we 5 profitable growth results in profitability growth. show pioneering spirit and are ready for innovation.
Efficiency You We distinguish ourselves from other players by our We do all this to provide our clients the best user 3 technology driven end-to-end set-up that enables 6 experience, our employees the best working future-proof operations and high scalability. environment and our stakeholders the best journey.
01 A Success Story
REVIEW STRATEGY
2019 2021 2026 flatexDEGIRO RED LINE THE NEW ERA OF BROKERAGE
The red line in our success story
Prepared the structures Seized the opportunity Facing ultimate growth
• Verticalised the value chain • Acquired the most Since the acquisition by insourcing technology competitive and only pan- and banking platform European peer for €250m • Grew customer base by >1 million clients • Focused on brokerage • De-risked the business strategy strategy by accessing • Settled over 120 million multiple markets and transactions • Optimized IT and banking investment cultures structures to control costs • Claimed market and allow scale • Realized quick win leadership in 3 countries synergies in less than 12 with more to come • Invested into state-of-the- months after deal closing art IT architecture to outperform
03 flatexDEGIRO OUR USPS VERSUS THE COMPETITION THE NEW ERA OF BROKERAGE
Prepared the structures: Our USPs versus the competition
Propriatory and with with Own German full home-grown banking license and technology platform European passport Fully independent brokerage platform
Self-managed Inhouse clearing with with state-of-the-art and settlement data centers structures
04 flatexDEGIRO SEIZED THE OPPORTUNITY THE NEW ERA OF BROKERAGE
Seized the opportunity: game-changing throphy deal
From a German hidden champion to the leading European 1.25m 75m online broker 300k Customers 12m Trades
18 €31.8b ~1,000
3 Countries €14.6b Assets under Custody ~500 Employees
2019 2020
05 flatexDEGIRO GROWING THE NEW ERA OF BROKERAGE
Facing ultimate growth…
Outperforming market growth with the High share of active customers with “right” clients is evidence for superior recurring and frequent trading and strategic positioning investing
CUSTOMERS TRANSACTIONS
CAGR +60% CAGR +80%
2 100
80 1.5 60 1 40
0.5 20
0 0 2019 2020 2021(e) 2019 2020 2021(e)
e: Management expectation, mid point of current guidance for 2021 06 flatexDEGIRO FOOTPRINT THE NEW ERA OF BROKERAGE
..across our pan-European footprint
+61% +24% WESTERN EUROPE DACH
+80% SOUTHERN EUROPE +48% NORTHERN EUROPE
Customer growth, CAGR 2018-2020 07 flatexDEGIRO SYNERGY THE NEW ERA OF BROKERAGE
.. and massive synergy measures
Euro cash accounts European ETP provided to all customers Partnerships > 30m Goldman Sachs BNP Paribas Refinancing of EBITDA credit book synergies
p.a. Early and late trading Harmonization of IT starting in July/August Infrastructure
08 flatexDEGIRO DELIVERING THE NEW ERA OF BROKERAGE
1 We delivered on income metrics.. 2019-2021 (c)
points Revenues~3.5x Adjusted~22% EBITDA margin expansion
EPS~7x Operating~4.5x Cash Flow
1 c: Concensus 09 flatexDEGIRO DELIVERING THE NEW ERA OF BROKERAGE
..consequently, we delivered for our shareholders
650 flatexDEGIRO
550 ~9.5xMarket cap
450
350 Bourse direct Avanza Swissquote
250 AJ Bell Charles Schwab Fineco 1 Nordnet 150 Interactive Brokers Renta 4 Hargreaves Lansdown 50
DEC-18 JUN-19 DEC-19 JUN-20 DEC-20
1 listed since November 2020 10 The New Era in Online Brokerage
REVIEW STRATEGY
2019 2021 2026
flatexDEGIRO NEW ERA THE NEW ERA OF BROKERAGE
! IT ! Stock Optimizing Investments brokerage processes
12
flatexDEGIRO NEW ERA THE NEW ERA OF BROKERAGE
! !
Int‘l Expansion by acquisition DEGIRO
IT Stock Optimizing Investments brokerage processes
Margin ETP Loans Partnerships
13
flatexDEGIRO NEW ERA THE NEW ERA OF BROKERAGE
! !
Verticalizing platform business
Crypto currencies Int‘l Expansion by acquisition DEGIRO flatex/DEGIRO IT next 3.0 Stock Optimizing Investments brokerage processes Early and late trading
Margin ETP Loans Partnerships
14 flatexDEGIRO CUSTOMERS THE NEW ERA OF BROKERAGE
Turning our Customers into a Fanbase
Lead in Lead in Lead in Technology Offering Innovation
• User interface • Product quality • Product offering • User experience • Service quality • Service offering • Stability and Security Lead by Example
• Increase uptime • Improve NPS • Personalized and • Improve app ratings • Reduce churn rates optimized approach • Reduce friction • Increase • Increase share of
Ambition engagement wallet
15
flatexDEGIRO IT THE NEW ERA OF BROKERAGE
!"
Lead in Technology What customers feel
Constant strong Most robust High level of Outstanding Substantial headroom investment in IT platform security availability for further scalability platform pays off exists already today
Upscaling our IT
09 March 2020 27 January 2021 100
100 80 80 60 60 40 40 20 20 0 0 Capacity usage Capacity usage (Covid-19) (Peak trading day with approx. 900k trades) – 2nd line
16
flatexDEGIRO OFFERING THE NEW ERA OF BROKERAGE
!"
Lead in Offering: ‘next 3.0’ - from pull to push What customers see
Sneak preview
Convenience
Value
Ubiquity
17
flatexDEGIRO INNOVATION THE NEW ERA OF BROKERAGE
❣"
Lead in innovation What customers want
Europe‘s leading financial supermarket platform
Partners integrate with Stocks ETP Connect to European flatexDEGIRO customer potential of ETF Mutual funds several million • Investment banks • ETF provider Crypto Insurances • Funds manager Mortgages
Open Platform Highly experienced in Easy integration Perfect customer base for Substantial opportunity to Architecture innovative partnership further expansion increase share of wallet models in the financial industry
18 flatexDEGIRO ESG THE NEW ERA OF BROKERAGE
Lead by Example..
Environment Education Offering Paperless Increase and improve Increase focus on ESG communication aim of understanding of products 100% by 2025 offering and product “flatex green” /
CUSTOMERS suitability “DEGIRO green”
Human Capital Technology Operation
• Increase employee • 100% green electricity • Reduce travelling satisfaction • UN supplier Charter • Overhaul car policy • Increase ownership • .. • .. • Maintain high level of CORPORATE diversity
19 flatexDEGIRO ESG THE NEW ERA OF BROKERAGE
..with respect to Customers..
20 flatexDEGIRO ESG THE NEW ERA OF BROKERAGE
..and with respect to Corporate Culture
Half tech-rockstars, 1/3 half under 30 non-tech- rockstars
45 1/3 nationalities female
Flexible 15% working partime well before Covid
21 Our unique opportunity flatexDEGIRO CUSTOMER POTENTIAL THE NEW ERA OF BROKERAGE
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
23 flatexDEGIRO SECULAR TRENDS THE NEW ERA OF BROKERAGE
..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: „I take care of my pension myself.“
Listed household brands: “I can invest easily in companies that I like and use.“
24 flatexDEGIRO TWO-FOLDED GROWTH THE NEW ERA OF BROKERAGE
..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 years <25 years
New incumbents 2m customers* (~ 10%) New 77m Old incumbents 1 Existing 20m customers 23m (~ 85%) 25-55 years Steal Win (~40%) market share market share
1 Company estimate 25 flatexDEGIRO CAPITAL INFLOW THE NEW ERA OF BROKERAGE
..in flatexDEGIRO core markets..
CAPITAL OUTFLOWS Saturated markets with structural divestments
(e.g. Nordic Capital)
CAPITAL INFLOWS Underdeveloped markets with enormous potential
• Sequoia, Accell, TVC, Founders Fund • Tencent, Prosus Ventures • Cryptology Asset Group, Alan Howard • Tencent, BlackRock • Valar Ventures (Peter Thiel), DST Global (Yuri Milner)
26 flatexDEGIRO COST LEADERSHIP THE NEW ERA OF BROKERAGE
..with most attractive pricing 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% 0127 flatexDEGIRO OUTSTANDING GROWTH THE NEW ERA OF BROKERAGE
..and outstanding growth rates..
Company Geographical Net new %Growth 2020 Customers 2020 Net new Custo- %Growth Customers focus Customers 2020 mers Q1 2021 Q1 2021 March 2021
flatexDEGIRO Europe +450k 56% 1.25m +360k 29% 1.61m
Nordnet Nordics +308k 34% 1.22m +167k 14% 1.39m
Avanza Nordics +304k 31% 1.28m +153k 12% 1.43m
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 - - [0.30m]
Swissquote Swirzerland +51k 14% 0.41m - - [0.41m]
Bourse direct France +45k 27% 0.21m - - [0.21m]
Fineco Italy +12k 1% 1.35m +39k 3% 1.39m
Peer average 17% 9%
Source: company data for publicly listed companies, press releases and news articles for non-listed companies
28 flatexDEGIRO HIGH-VALUE CUSTOMERS THE NEW ERA OF BROKERAGE
.. while growing an exceptionally high-value customer base.
Size of bubble indicating numer of trades executed in 2020
90
80
70
60
50 flatexDEGIRO
40 1 Nordnet Comdirect Bourse 30 direct Avanza 20 Fineco
10 Swissquote Hargreaves Lansdown Average trades per customer in 2020 0 -5% 5% 15% 25% 35% 45% 55% 65%
Customer growth in 2020
1 Comdirect: Trading activity based on 9M/2020 figures 29 Next chapter of growth flatexDEGIRO COMMERCIAL GROWTH THE NEW ERA OF BROKERAGE
~ 4 x customer base … 3 x trading volume
CAGR +30% CAGR +20%
7-8m 250-350m*
2.0-2.2m 90-110m
2021(e) 2026(e) 2021(e) 2026(e)
* in a year with low market volatility
31 flatexDEGIRO WHY WE BELIEVE THE NEW ERA OF BROKERAGE
Why we believe in upcoming market growth %
Global Switzerland
- Start Crypto brokerage in H2 2021 On-site custody accounts - flatex/DEGIRO 3.0 ! will accelerate growth - Support of secular trends by (estimated Q1 2022) increasing marketing in the industry France 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)
32 flatexDEGIRO CASE STUDY FRANCE THE NEW ERA OF BROKERAGE
Case study France: Rising to market leadership
1 stage Start operations
2 stage Turn on powerful marketing
3 stage Add ancillary services
33 flatexDEGIRO BLUEPRINT FOR MARKET LEADERSHIP THE NEW ERA OF BROKERAGE
Blueprint for future market leadership
Large growth potential in other European Markets.
#
! "
34 flatexDEGIRO REVENUE OPPORTUNITY THE NEW ERA OF BROKERAGE
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
35 flatexDEGIRO PROFITABILITY GROWTH THE NEW ERA OF BROKERAGE
Profitable growth results in profitability growth
1 Adjusted EBITDA margin
Doubling profitability
29% 44% 54% >60%
2019 2020 Q1/2021 2026(e)
1 adjusted for long-term incentive plan
36 flatexDEGIRO CAPITAL ALLOCATION THE NEW ERA OF BROKERAGE
Capital Allocation
• Invest in markets Organic growth • Invest in platform and products investments • Maintain sustainable capitalization
• High quality sector targets or Sensible verticalization • Opportunities that accelerate acquisition expected generation of customer growth, expand strategy product offering or improve technological set-up > EUR 1.5bn in accumulated Balanced • Potential share buybacks especially during inviting capital return Operating Cash Flow market environment 2022-2026
37 flatexDEGIRO 2026 OUTLOOK THE NEW ERA OF BROKERAGE
Our 2026
outlook 1 Extending our position Customers7-8m Minimum250-350m Transactions as Europe's leading online broker.
2 Revenue€1.5bn (up to) Adjusted>60% EBITDA Margin
Accumulated>€1.5bn Operating Cash Flow (2022-2026)
1 In a year of low market volatility 2 Adjusted for long-term incentive plan 38 flatexDEGIRO CAPITAL MARKET STORY THE NEW ERA OF BROKERAGE
Our Capital Market story - elevate to next stage
flatexDEGIRO with highest liquidity of Attractiveness of flatexDEGIRO for global blue-chip all SDAX shares investors significantly increased.. 320m • SDAX listing has put us on the radar screen • MarketCap of EUR 3 bn and highest liquidity of all SDAX stocks make us investable • Strong long-term growth story valuation makes us attractive 240m
..with further steps in the pipeline. 160m • Active dialogue with ESG rating agencies initiated, expected to result in material improvement of current ratings • Proposed stock split (4:1) to further increase liquidity • Aiming for MDAX at year-end 80m
0 JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY
Order book turnover(€) in the last 12 months
39