EasyEquities faces big competition in South Africa

Purple Group, the owner of popular trading platform EasyEquities, recently notified shareholders that it expects to report significantly higher earnings per share when it publishes its financial results this week.

The company’s good news comes at a time when competition is ramping up in South Africa’s retail trading platform market.

Over the past few months, big players like Investec and Standard Bank’s Shyft have launched their own trading platforms.

In February this year, Investec opened its Clarity platform to the public after it was previously only available to the bank’s private banking clients. 

A month later, Standard Bank’s Shyft expanded its investing universe to include trading on the JSE alongside its global offering of equities in the United States, Europe, and the United Kingdom. 

This is the first time EasyEquities has faced direct competition from traditional incumbents in the retail investing space. 

While it has an edge over Standard Bank and Investec’s offerings, the platform still finds itself in a far more competitive environment now than when it first launched.

One of EasyEquities’ biggest selling points is that it enables users to invest in whole shares and fractional security rights (FSR)

In comparison, Clarity only allows its users to access financial assets through contract-for-difference (CFD) instruments, while Shyft only allows users to buy whole shares. 

However, Shyft has said that fractional shares would be available to investors soon.

In the meantime, another international competitor is set to launch in South Africa soon, as US-based Webull has set its sights on the country.

Webull announced earlier this year that it is opening its African branch in South Africa and plans to be operational from the end of this year.

Purple Group earnings boost

Purple Group said on Friday that it expects its interim earnings to triple, anticipating basic and headline earnings per share of between 2.29 cents and 2.44 cents, compared to the 0.78 cents reported in the prior period.

This represents an increase of between 194% and 213%. 

Purple Group said it expected to publish its results for the six months ended 28 February 2025 on the JSE news service on or about 9 April 2025.

Based on its trading update, Purple Group’s upcoming interim results will continue the momentum the company built in its 2024 financial year.

In November 2024, the company released its results for the year through August 2024.

These results showed that the company’s revenue grew by over 45% to R400.43 million and swung from a R35.20 million loss to R35.58 million profit.

The company’s basic earnings are also in the black, having gone from a loss of 1.90 cents per share to earnings of 1.77 cents.

Most of the company’s revenue was derived from retail, which was R241 million, followed by non-activity-based revenue, which was R206 million.

Non-activity-based revenue includes revenue more closely linked to the value of client assets and the number of clients on the platform.

This type of revenue primarily includes asset management fees, administration revenue, cash management fees, Thrive fees and other asset-based fees.

Therefore, the company benefitted significantly from its client growth over the past year, with active clients growing by 10.4% to 991,320.

Client assets also saw significant growth of 24.8% to R58.2 billion. Registered clients grew by 11% to R2.29 million.

“Reflecting on this past year fills me with immense pride and an enhanced sense of excitement,” CEO Charles Savage said. 

“Purple Group has spent a decade breaking down barriers, opening doors, and reimagining what’s possible for all investors.”

“In 2024, Purple Group didn’t just sustain growth; we unlocked new realms of opportunity, setting records and scaling the impact of our platform”

“Over the past 10 years, our annual growth rates have consistently defied expectations, and these figures testify to the value we bring to our clients and shareholders alike.”

A version of this article was first published by Daily Investor and is reproduced with permission.