ii Fiight Club: An introduction by Richard Wilson and Moira O'Neill

Clicker, that's me. Good afternoon, thank you so much for coming today. This is an extraordinary venue and we're very excited about the proceedings. Part of what I'd hoped to do here with you today is get on with the main event, but I was given the impression that some of you would like to see a little bit about what interactive is up to, where it's come from, and where it's going. So I'll spend a few minutes on that and I'll try not to bore you too much. If I can just ask before I do that so I know who I'm speaking to in the audience, who here are actually interactive investor customers? Could I see a show of hands? Thank you very much. Just for curiosity, who among the customers here have been with us for more than five years? More than 10 years? Okay, we've got work to do. And for those who didn't raise your hands at all, you know how to log on downstairs and we expect you to sign up as soon as possible. That's the sales pitch over. So what I'll do is a little bit about what we're aspiring to be and then just go through the story about where we've come from, where we are now, and what we're doing next. So if we can just roll the video. ... Thank you. Goodbye. No, and so that's what our aspiration is in terms of what we would like to provide. A few moments on our history, because as many of you know, we're not brand new. We were founded nearly 25 years ago now and originally we were an information service. That DNA, that ability or that intent to provide information to consumers to make informed choice stays part of our core today. The journey had a slight interlude during the dot-com period where it got a bit of a famous period of Nasdaq, but after then it was fairly quiet until 2011 when ii became an execution-only broker and introduced in 2012, post-RDR, a pretty radical proposition which was a simple fee that was brand new at the time. We've stayed with the ethos of a simple flat price for service ever since. So we don't have any interest in taking a slice of anybody's savings; we provide a service and we charge a fee. Since then, more recently, we've gone through a process of growing up and scaling. Some of you I'm sure would have been customers of previous antecedent companies where we've reacquired TD Direct in 2007 and more recently acquired Alliance Trust Savings, which subject to military approval would expect to close this June. In the meantime, via the TD transaction, we did acquire a European Bank which we sold in August and we expect that to close before the end of March. So that's the kind of industrial process that takes us today to be an enterprise which has roughly 27, 27 and a half billion of assets, which is about 12 and a half percent of the market, about 16 percent of equity trading in the UK, and something around 400,000 customers or half a million accounts. Why does that matter? The economics of a platform are quite simple. We provide information to customers so they can make their choice. We execute trades on their behalf and we custody the assets. For that we charge a fee that translates into economics where there are very high quality of earnings. We expect the relationship with customers, as we've seen here, to be between five and twenty-five years. It's also partly because of the necessary investment in technology, it's a scale business. A scale business with high fixed costs: if you don't have sufficient scale, you can't generate the returns to invest. So despite the fact that we believe we are the best value platform in the country, we currently produce something like in technical accounting terms a 30% EBIT margin, which today is around 20 million pounds a year of profit. That's crucial as we invest for the future and I'll talk about that in a few seconds. So where are we today? First of all, where we could do everything better. I think the first thing for us as a consumer business is to be humble. We have lots to learn every day and we have lots to listen to and to improve on. We are at our heart a service business, and anyone who forgets that loses their way. We exist because of our customers and it's only because we serve you in the right way that we can be successful. That's part of our DNA and part of our purpose and that will not leave. Where we stand today in terms of how we think that we differentiate in the marketplace. In terms of choice, we support something like half a million instruments on the platform, which is over twice the choice of any other platform providing direct market access to the majority of global markets across multiple currencies. That's great, provided that customers are able to actually research and use those. We're very proud of our editorial journalistic team who every day produce award-winning content and share views on offerings in the marketplace to help make those choices. There are two parts of that today which are highlights published recently: one is the Santé funds which have been very successful, and secondly the Super 60 which is part of that guidance frame to provide more informed choice and make it simpler for the end consumer. In terms of price, we are a very simple flat fee provider, that won't change, and we'd expect to try and make that a little more aligned to individual customers' needs in the future. Today it's one size fits all irrespective of whether you trade a lot or not, so we'll try and adjust that as we go forward. Of course we do have a heavy investment in technology and we've got a lot to do on the app, but today it's 4.0 in the App Store and it won the best dealing app in the UK in 2018. Not good enough yet, we focus very hard on making that something which is intuitive and engaging. It's not there yet, it will be in the next 12 to 15 months. Last but by no means least, as a service business we are committed to providing the best service in the sector. We are investing, have invested, continue to invest very hard in customer service. Trustpilot today I think it's 8.2 and it's tracking positively. I can only thank those of you who provided feedback whether it's positive or negative. Our job is to listen and to respond. We have several thousand responses which we watch every day, and we don't get everything right every time. Our job is to get it right and listen and respond personally. This is not an invitation by the way, I do respond personally to most of our complaints. That's not a suggestion. So our team is in front of this and it matters. Tomorrow we expect to invest more and more in making it easier and more intuitive to provide you with the choices so you can do what's right for you. People use expressions like robo etc. We will provide progressively better tools in terms of guidance to support you in that process. The reality is as well, we have customers from between their 20s and their 80s, between vulnerable customers to those with no computers to those who are very focused and trade a lot. We need to be able to personalize that service more to satisfy their needs. That includes for example this year we'll expect to introduce friends and family accounts, so families can introduce their children or friends at an improved price position. We expect to be able to provide real-time data to those that trade more. We expect that in the next few months we will be replacing our security infrastructure so it's state of the market, and we'll continue to invest in those services so that we're able to be the best at what we do. Part of that is about listening and learning. So thank you all for your ongoing feedback. I don't take any more time. It's not about us, it's about the event tonight. But what I would like to do if I can is hand over to Richard Hunter, head of markets, who's going to provide you with a global perspective. Thank you very much and enjoy the session.