Nomura Holdings, Inc. · TSE:8604
Nomura — Q1 FY2006.3 Earnings Presentation
35 slides from Nomura's earnings presentation, July 2005
Slide 1: Consolidated Results of Operations (US GAAP)
Consolidated Results of Operations (US GAAP) First quarter, year ending March 2006 Nomura Holdings, Inc. July 2005 1
Slide 2: Disclaimer
1. This document is produced by Nomura Holdings, Inc. ("Nomura"). Copyright 2005 Nomura Holdings, Inc. All rights reserved. 2. Nothing in this document shall be considered as an offer to sell or solicitation of an offer to buy any security, commodity or other instrument, including securities issued
Slide 3: Outline
Outline Presentation Appendix Consolidated Financial Summary (p. 4-5) Revenue Revenue and Income by Business Segment (p. 6) Commissions (p. 17) Domestic Retail Fees from Investment Banking (p. 18) Revenue (p. 7) Asset Management and Portfolio Service Fees (p. 19) Retail Client Asse
Slide 4: Consolidated Financial Summary (1)
Consolidated Financial Summary (1) (millions of yen, per share data in yen) FY2006.3 1Q FY2005.3 1Q FY2005.3 4Q YoY QoQ Net revenue 286,735 213,928 234,533 34% 22% Non-interest expenses 256,031 141,462 167,563 81% 53% Income before income taxes 30,704 72,466 66,970 -58% -54% Net income 8,321 40,832
Slide 5: Consolidated Financial Summary (2)
Consolidated Financial Summary (2) (millions of yen) FY2006.3 1Q FY2005.3 1Q FY2005.3 4Q YoY QoQ Revenue 421,119 275,295 328,353 53% 28% Commissions 55,152 69,533 60,570 -21% -9% Fees from investment banking 14,719 15,434 26,137 -5% -44% Asset management and portfolio service fees 19,942 18,185 21,1
Slide 6: Revenue and Income by Business Segment
Revenue and Income by Business Segment (billions of yen) FY2006.3 FY2005.3 FY2004.3 YoY QoQ 1Q 4Q 3Q 2Q 1Q 4Q 3Q 2Q 1Q Domestic Retail Net revenue 84.8 -2% 7% 79.6 73.0 64.8 87.0 79.8 75.4 75.6 75.0 Non-interest expenses 54.5 2% -9% 60.0 55.0 54.9 53.3 59.8 55.3 56.9 54.2 Income before income taxes
Slide 7: Domestic Retail (1) Revenue
Domestic Retail (1) Revenue Revenue Revenue up up 7%, 7%, income income before before income income taxes taxes up up 55% 55% on on strong strong sales sales of of investment investment trusts trusts Commissions: 45.2 billion yen (down 1%) Fees From Investment Banking: 3.4 billion yen (down 41%)
Slide 8: Domestic Retail (2) Retail Client Assets
Domestic Retail (2) Retail Client Assets* Retail Retail client client assets assets top top 40 40 trillion trillion yen yen on on robust robust sales sales of of investment investment trusts trusts and and JGBs JGBs for for individual individual investors investors * Domestic Retail, excluding regio
Slide 9: Domestic Retail (3) Net Asset Inflow
Domestic Retail (3) Net Asset Inflow (monthly average)* (billions of yen) 900 844.3 800 700 600 500 400 318.1 300 258.9 275.5 228.0 200 162.4 146.1 146.3 128.2 100 0 FY2004.3 FY2005.3 FY2006.3 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q *Net Asset Inflow: Gap between inflow and outflow of assets 9 Net asset inflow d
Slide 10: Global Markets Revenue
Global Markets Revenue Revenue Revenue down down 29% 29% due due mainly mainly to to aa decline decline in in fixed fixed income-related income-related revenue revenue resulting resulting from from tough tough market market environment environment Fixed Income Equity MTN issues at high level
Slide 11: Global Investment Banking Revenue
Global Investment Banking Revenue Revenue Revenue down down 34% 34% on on decline decline in in Equity Equity financing financing Equity and Equity-related Underwriting (IPO, PO, CB)1 Capital Solutions Business Value Total: USD 4.42 billion (down 63% QoQ) Multiple Private Offerings (MPOs) No
Slide 12: Global Merchant Banking Revenue
Global Merchant Banking Revenue Revenue Revenue of of minus minus 3.3 3.3 billion billion yen yen due due to to funding funding costs costs for for Terra Terra Firma Firma New Deals Merchant Banking Business Exposure Misawa Homes Holdings (billions of yen) 500 NPF 429.5 427.8 z Fund originated
Slide 13: Asset Management (1) Revenue
Asset Management (1) Revenue Revenue Revenue up up 19% 19% due due primarily primarily to to increase increase in in net net asset asset value value of of stock stock investment investment trusts trusts New Funds Frequent Distribution Fund Growth (billions of yen) 1,400 Funds Offering Frequent
Slide 14: Asset Management (2) Assets Under Management
Asset Management (2) Assets Under Management (Nomura Asset Management, NCRAM*) (trillions of yen) (billions of US$) 18 14 16.0 16.8 Investment advisory (overseas) (lhs) 15.4 15.7 15.7 15.7 16 15.2 15.1 14.5 12 Investment advisory (domestic) (lhs) 14 10 Privately placed investment trusts (lhs) 12 Pub
Slide 15: Non-interest Expenses (Excluding Private Equity Investee Companies)
Non-interest Expenses (Excluding Private Equity Investee Companies) (billions of yen) Compensation and Benefits 50 Non-interest Non-interest expenses expenses dropped dropped 9% 9% 39.2 38.6 36.4 36.4 37.7 37.8 40 35.9 35.9 34.3 Note: All non-interest expense figures shown on this slide exclude the
Slide 16: Appendix
Appendix 16 16
Slide 17: Revenue (1) Commissions
Revenue (1) Commissions (billions of yen) 80 Other 69.5 70 62.9 60.6 Commissions for distribution of 57.6 60 56.0 55.2 investment trusts Other commissions 50 45.6 46.3 Stock brokerage commissions 40 33.8 (Other) Stock brokerage commissions 30 (Domestic Retail) 20 10 0 FY2004.3 FY2005.3 FY2006.3 1Q 2
Slide 18: Revenue (2) Fees from Investment Banking
Revenue (2) Fees from Investment Banking (billions of yen) 35 32.3 Other 30 28.2 26.1 Financial advisory 24.4 fees 25 19.9 Bond underwriting 20 18.4 commissions 14.5 15.4 14.7 15 Equity underwriting commissions 10 5 0 FY2004.3 FY2005.3 FY2006.3 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Equity underwriting commissi
Slide 19: Revenue (3) Asset Management and Portfolio Service Fees
Revenue (3) Asset Management and Portfolio Service Fees (billions of yen) 25 21.1 19.8 19.3 19.9 Custodial fees 20 18.6 18.2 17.0 16.8 Administration fees 13.7 Asset management fees 15 10 5 0 FY2004.3 FY2005.3 FY2006.3 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Asset management fees 9.4 10.8 11.8 12.1 12.5 12.4 13.
Slide 20: Revenue (4) Net Gain on Trading
Revenue (4) Net Gain on Trading (billions of yen) 140 Net interest revenue 113.9 120 99.5 Gain on private equity investment/ 100 merchant banking trading 86.4 84.4 Equity 74.6 74.7 80 67.3 Bonds and other 50.1 60 42.8 40 20 0 1 2 3 4 5 6 7 8 9 -20 FY2004.3 FY2005.3 FY2006.3 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1
Slide 21: Key Items of Consolidated Balance Sheets
Key Items of Consolidated Balance Sheets (m illions of yen) M ar. 2005 Jun. 2005 M ar. 2005 Jun. 2005 Assets Liabilities Cash and cash deposits 1,186,756 1,271,279 Short-term borrow ings 517,065 490,574 Private equity entities short-term borrow ings 116,054 117,533 Loans and receivables 1,244,528 93
Slide 22: Major Differences (Segment/Income Statement)
Major Differences (Segment/Income Statement) FY2005.3 FY2006.3 (billions of yen) 1Q 2Q 3Q 4Q Full Year 1Q Total Income before Income Taxes for Business Segments 67.1 22.0 38.1 47.7 175.0 29.2 Loss/gain on undesignated hedging instruments included in net gain on trading -13.0 5.3 0.9 -1.8 -8.7 -2.8 L
Slide 23: Effect of Consolidation/Deconsolidation of Certain Private Equity Investee Companies (1)
Effect of Consolidation/Deconsolidation of Consolidated Income Statement Certain Private Equity Investee Companies (1) (millions of yen) US GAAP Figures Quarterly FY2006.3 FY2005.3 FY2005.3 1Q 1Q 4Q YoY QoQ Net revenue 286,735 213,928 234,533 34% 22% Non-interest expenses 256,031 141,462 167,563 81%
Slide 24: Effect of Consolidation/Deconsolidation of Certain Private Equity Investee Companies (2)
Effect of Consolidation/Deconsolidation of Non-interest Expenses Certain Private Equity Investee Companies (2) (billions of yen) FY04.3 FY05.3 FY06.3 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Compensation and benefits 65.9 67.7 61.8 63.9 65.9 64.2 67.4 77.4 87.1 Fixed-type compensation and benefits 36.6 36.1 36.1
Slide 25: Effect of Consolidation/Deconsolidation of Certain Private Equity Investee Companies (3)
Effect of Consolidation/Deconsolidation of Consolidated Balance Sheet Certain Private Equity Investee Companies (3) Assets As of June 30, 2005 (billions of yen) Total Assets 34,164 Excluding private equity investee companies 33,111 Private equity investee companies 1,053 Note: Private equity investe
Slide 26: Nomura Securities Client Assets
Nomura Securities Client Assets (trillions of y en) 80 72.5 70.0 67.9 70 65.0 63.8 63.5 57.6 58.2 60 52.9 50 O ther O vers eas m utual funds 40 B ond inves tm ent trus ts 30 S toc k inves tm ent trus ts 20 B onds 10 E quities 0 Jun. 2003 S ept. 2003 Dec . 2003 M ar. 2004 Jun. 2004 S ept. 2004 Dec .
Slide 27: Domestic Retail Related Data
Domestic Retail Related Data FY2004.3 FY2005.3 FY2006.3 Domestic Retail 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Retail Foreign Currency Bond Sales (billions of yen) 976.8 405.1 316.3 291.8 228.7 243.0 313.1 369.6 304.8 Commissions for investment trusts distribution and redemption (billions of yen)* 9.6 10.1 12.3
Slide 28: Number of Accounts
Number of Accounts FY2004.3 FY2005.3 FY2006.3 (thousands of accounts) 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Nomura Home Trade (online trading accounts) 1,168 1,215 1,290 1,367 1,452 1,533 1,651 1,716 1,774 IT Share No. of orders 45% 46% 46% 49% 49% 51% 50% 51% 52% Transaction value 21% 21% 21% 23% 23% 25% 23%
Slide 29: Secondary Market Share Data
Secondary Market Share Data (trillions of yen) FY2004.3 FY2005.3 FY2006.3 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Individual Equity Agency Transactions Share (monthly average) Market 5.0 9.1 9.8 11.4 13.9 10.0 9.9 14.4 12.9 Nomura's share 8% 10% 9% 10% 10% 7% 8% 8% 7% Off-floor/Off-exchange Equity Trading Share
Slide 30: Primary Market Share Data
Primary Market Share Data* FY2004.3 FY2005.3 FY2006.3 1Q 1Q-2Q 1Q-3Q 1Q-4Q 1Q 1Q-2Q 1Q-3Q 1Q-4Q 1Q Japanese IPO Nomura's share 5% 10% 26% 27% 45% 42% 36% 32% 13% Japanese PO Nomura's share 37% 58% 39% 33% 17% 26% 26% 25% 24% Convertible Bonds Nomura's share 9% 14% 26% 28% 21% 20% 18% 19% 26% Global
Slide 31: League Tables
League Tables Global Equity & Equity-related (Japan) Any Japanese Involvement Financial Advisers Announced deals, value base R Jan. 1, 2005 - Jun. 30, 2005 R Jan. 1, 2005 - Jun. 30, 2005 a a n Bookrunner Proceeds No. n Adviser Proceeds No. Mkt. Share Mkt. Share k (US$mn) of Issues k (US$mn) of Deals
Slide 32: Domestic Public Investment Trust Market/Nomura Asset Management Market Share
Domestic Public Investment Trust Market/ Nomura Asset Management Market Share (trillions of yen) 50 100% 45 90% Bond investment trusts (lhs) 40 80% Stock investment trusts (lhs) 35 70% 30 60% Public bond investment trusts, Nomura's share (rhs) 25 50% Public stock investment trusts, 20 40% Nomura's s
Slide 33: Value at Risk (Consolidated)
Value at Risk (Consolidated) Definition From April 1, 2005 to June 30, 2005 99% confidence level Maximum: 5.7 billion yen 1-day time horizon for outstanding portfolio Minimum: 3.8 billion yen Inter-product price fluctuations considered Average: 4.8 billion yen (billions of yen) End o
Slide 34: Number of Employees
Number of Employees Jun. 2003 Sept. 2003 Dec. 2003 Mar. 2004 Jun. 2004 Sept. 2004 Dec. 2004 Mar. 2005 Jun. 2005 Asia/Oceania 622 646 652 655 668 684 704 718 746 Americas 821 843 852 866 914 935 968 1,026 1,069 Europe 1,439 1,372 1,439 1,403 1,407 1,458 1,499 1,535 1,524 Japan (FA, SA) 1,960 1,901 1,
Slide 35: Nomura Holdings, Inc.
Nomura Holdings, Inc. www.nomura.com 35 35