Gmo Payment Gateway, Inc. · TSE:3769

Gmo Payment Gateway — Q1 FY2025 Earnings Presentation

43 slides from Gmo Payment Gateway's earnings presentation, Feb 13, 2025

  1. Slide 1: Financial Results Briefing for Q1 FY2025

    Financial Results Briefing for Q1 FY2025 Q1 results was ahead of plans; progressing with measures to achieve operating profit CAGR of 25% February 13, 2025 80th Investor Meeting

  2. Slide 2: Safe Harbor Statement for Forward Looking Statements

    Safe Harbor Statement for Forward Looking Statements The contents of this document is based on generally recognized economic and social conditions, as well as certain assumptions judged to reasonable by GMO Payment Gateway as of February 13, 2025. Please note that the contents are subject to change

  3. Slide 3: Agenda

    Agenda 1. Summary of Financial Results for Q1 FY2025 2. Growth Strategy and Initiatives in Focus Areas 3. Sustainability 4. Financial Highlights and Reference Materials Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 3

  4. Slide 4: 1. Summary of Financial Results for Q1 FY2025

    1. Summary of Financial Results for Q1 FY2025 Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 4

  5. Slide 5: 1.1 Summary of Consolidated Results

    1.1 Summary of Consolidated Results Revenue grew 14.1% and ahead of plans, OP grew 24.4% FY2025 Progress ratio Q1 FY2024 Q1 FY2025 （¥ mil） % YoY Guidance vs. Full year Actual Actual (1H guidance) vs. 1H 83,377 24.3% Revenue 17,785 20,295 +14.1% 39,130 51.9% 52,319 26.0% Gross Profit 11,547 13,618 +1

  6. Slide 6: 1.2.1 Waterfall Chart of Consol. Revenue (YoY)

    1.2.1 Waterfall Chart of Consol. Revenue (YoY) GMO-FG’s initial revenue declined 12.0% from high base effect of terminal sales in the previous Q1 Consol. GMO-PG*3 GMO-PS*3 Consol. Overseas*3 Consol. （% YoY） GMO-FG*1*2 GMO-EP *1*3 （¥ bn） +1.9% +21.4% +7.5% +11.4% +44.3% +14.1% 21 Other ¥20.2 bn 20 Pa

  7. Slide 7: 1.2.2 Trend of Revenue Growth

    1.2.2 Trend of Revenue Growth Revenue excl. payment terminals grew stably at 19.2% Breakdown of consol. revenue and % YoY growth rates (quarterly trend) （¥ mil） High base effect from large GMO-FG Initial revenue (left axis) project in previous FY 60.0% Payment terminal sales -12.0% GMO-FG revenue ex

  8. Slide 8: 1.2.3 Waterfall Chart for Consol. OP and Pre-tax Profit (YoY)

    1.2.3 Waterfall Chart for Consol. OP and Pre-tax Profit (YoY) OP grew 24.4% from increase in gross profit and decline in provisioning for doubtful accounts OP waterfall chart Pre-tax profit waterfall chart （¥ mil） （¥ mil） % YoY +24.4% % YoY +28.2% GP SGA Equity increase increase Other Other method +

  9. Slide 9: 1.3.1 GMO-PG Non-Consol. Performance (YoY)

    1.3.1 GMO-PG Non-Consol. Performance (YoY) Revenue grew 21.4% from contribution from new customer and growth in payments from existing merchants GMO-PG non-consolidated revenue & OP (quarterly) *1 % YoY （¥ mil） Merchandise EC revenue Q1 FY2024 Q4 FY2024 Q1 FY2025 Revenue Non-merchandise EC revenue 1

  10. Slide 10: 1.3.2 Performance of GMO-EP, GMO-PS and GMO-FG (YoY)

    1.3.2 Performance of GMO-EP, GMO-PS and GMO-FG (YoY) EP’s growth recovery continues, PS’ profitability improve and FG impacted from high base effect Consol. GMO-EP (quarterly)*1*2 GMO-PS (quarterly)*2 Consol. GMO-FG (quarterly)*1*3 (% YoY） Q1 FY2024 Q1 FY2025 Q1 FY2024 Q1 FY2025 Q1 FY2024 Q1 FY2025

  11. Slide 11: 1.4 Waterfall Chart of Consol. TRX Value (YoY)

    1.4 Waterfall Chart of Consol. TRX Value (YoY) Increase of ¥1 trn YoY from above-market growth of CP and online CP Online payment GMO-PG +17.9% Consol. +24.6% payment *1 Market stats +7.4% （% YoY） Non-merchandise EC Merchandise EC （¥ trn） GMO-PG +37.3% +24.3% +7.7% Market stats*1 +10.2% +12.2% +4.1%

  12. Slide 12: 1.5 Segment Results (YoY)

    1.5 Segment Results (YoY) MSB profits increased 59.9% from the normalization of credit costs Segment revenue* Segment profit/loss* % YoY % YoY Q1 FY2024 Q1 FY2025 Q1 FY2024 Q1 FY2025 (¥ mil) (¥ mil) +20.1% +14.1% +14.5% +24.4% 20,000 +31.6% +34.8% +124.3% +7.3% 8,000 +19.7% +16.0% +30.1% +59.9% + Ov

  13. Slide 13: 2. Growth Strategy and Initiatives in Focus Areas

    2. Growth Strategy and Initiatives in Focus Areas Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 13

  14. Slide 14: 2.1 Expansion of Business Domains

    2.1 Expansion of Business Domains Aim for OP 25% CAGR by expanding TAM by entering new domains 2005 2025 Going forward B2C EC TAM ¥3 trn 60 times ¥180 trn* ＋ Wholesale domain ¥56 trn 2.6 Corporate card ¥6 trn 2.3 Education domain ¥5 trn 2.10 Revenue ¥1.3 bn 64 ¥83.3 bn times OP ¥0.3 bn 100 ¥30.2 bn

  15. Slide 15: 2.2 The Fruits of Joining the PG Group

    2.2 The Fruits of Joining the PG Group enpay joins PG group in January 2025; accelerate growth by creating synergies Revenues of three companies after joining PG group Joins PG Support provided by GMO-PG (excerpt) in Jan. 2025 （¥ mil） GMO-MR All three companies 30,000 GMO-FG Seconded several personn

  16. Slide 16: 2.3 Buildout of Platform Business

    2.3 Buildout of Platform Business Develop and offer platforms that supports financial business innovation Opportunity Revenue of platform-type businesses (annual trend) Creation of stock and transaction type revenue streams Inter-company payment Financial SIer （¥ mil） PF (Mizuho Bank) Institution BP

  17. Slide 17: 2.4 Sales Strategy by Segment

    2.4 Sales Strategy by Segment Accelerated strategy by reorganizing sales based on customer segment in April 2024 SGA to revenue ratio Index of revenue per contract (GMO-PG non-consol.) (quarterly moving average, GMO-PG & EP only) Increase adoption of industry-specific payment application Efficiently

  18. Slide 18: 2.5.1 GMO-PG Non-Consolidated Strategy: Online Payment

    2.5.1 GMO-PG Non-Consolidated Strategy: Online Payment Progressing in line with plan to build up the project pipeline to achieve 2H plans GMO-PG non-consol. revenue: actual and plans (half-yearly) GMO-PG non-consol.: TRX value and market stats* (% YoY) Pipeline （¥ mil） (i.e. estimates GMO-PG 30.0% 2

  19. Slide 19: 2.5.2 GMO-PG Non-Consol. Strategy: BaaS Support and EF

    2.5.2 GMO-PG Non-Consol. Strategy: BaaS Support and EF*1 Processing PF revenue up 36.2%, expanding pipeline for next FY and beyond BaaS Support service revenue*2 (1Q) Progress of processing PF projects % YoY Est. revenue size (3-levels) NEW：Updates after Q4 FY2024 ■ Ginko Pay base system ■ Acquiring

  20. Slide 20: 2.6 Consol. GMO-EP Strategy: Online Payment (SME) & Healthcare DX

    2.6 Consol. GMO-EP Strategy: Online Payment (SME) & Healthcare DX Driving alliance strategy to make inroads into non-merchandise and inter-company payment domains Consol. GMO-EP revenue (quarterly) Focus initiatives （¥ mil） % YoY Existing payment service ・Progressing with rate change for existing Re

  21. Slide 21: 2.7 GMO-PS Strategy: Payment After Delivery & BNPL

    2.7 GMO-PS Strategy: Payment After Delivery & BNPL Revenue from new domains up 74.0%; OP grew 187.7% from low and stable default rates GMO-PS revenue and operating profit (Q1) Default rates and GMO-PS operating profit (quarterly trend) New domain (left axis) In-housing credit (¥ mil) % YoY screening

  22. Slide 22: 2.8 Consol. GMO-FG Strategy: CP Payment

    2.8 Consol. GMO-FG Strategy: CP Payment Profit growth measures to achieve FY2033 OP target of over ¥10.0 bn Consol. GMO-FG revenue by business model*1 (quarterly trend) Active IDs x ARPU x GP margin = OP growth (¥ mil) % YoY ('000 units) 5,000 1. Achieve 1 mil active IDs Initial -12.0% 400 ('000 IDs

  23. Slide 23: 2.9 Global Strategy: Earnings Summary

    2.9 Global Strategy: Earnings Summary Revenue grew 41.3% from new loans and increase in loan amount to prime borrowers, incl. weak yen effect Revenue and OP (Q1) Loan balance (end-Dec) Business environment (¥ mil) % YoY (¥ mil) % YoY Interest rate Declining interest rates in US and India +41.3% +40.

  24. Slide 24: 2.10.1 enpay Joins PG Group (January 2025)

    2.10.1 enpay Joins PG Group (January 2025) Driving the cashless migration and DX in the nursery and education sectors Product Growth strategy One-stop offering of LINE billing, payment and deposit management Short term: Sales synergy with GMO-PG service (local government, large enterprises, etc.) UI

  25. Slide 25: 2.10.2 Expansion of Infrastructure Domain

    2.10.2 Expansion of Infrastructure Domain Make inroads into the defensive education domain through enpay Revenue from infrastructure domain Utility Insurance Medical reservation and Mobility Rent Ride share 2020 onwards Healthcare/ Market size by industry* Cashless penetration* 3.7 times Aged care i

  26. Slide 26: 3. Sustainability

    3. Sustainability Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 26

  27. Slide 27: 3. Sustainability: Integrated Report

    3. Sustainability: Integrated Report Scheduled to publish FY2024 Integrated Report in mid-February (Japanese language version) FY2024 Integreted Report (English): Scheduled to be published in April 2025 https://www.gmo-pg.com/en/ir/library/integrated-report/ Major contents ・Message From The CEO ・Pro

  28. Slide 28: 4. Financial Highlights and Reference Materials

    4. Financial Highlights and Reference Materials Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 28

  29. Slide 29: 4.1.1 Consolidated Balance Sheet

    4.1.1 Consolidated Balance Sheet Increase in merchant deposits and MSB related assets due to scaling up of business Assets Liabilities and Equity (¥ mil) Cash (¥ mil) corresponding to 400,000 400,000 deposits received 385,793 385,793 from merchants 344,702 344,702 300,000 292,346 292,346 150,310 300

  30. Slide 30: 4.1.2 Major Consolidated Financial Indicators (Annual Trend)

    4.1.2 Major Consolidated Financial Indicators (Annual Trend) Managing businesses while balancing profitability, capital efficiency and capital base J-GAAP IFRS Third party allotment Issued Euro Yen Euro Yen CB Due 2026 Raised ¥8.0bn CB Due 2023 Raised ¥21.1 bn （¥ bn） 45% Raised ¥17.5 bn 400 Euro Yen

  31. Slide 31: 4.2 Consolidated Revenue and Operating Profit (Quarterly)

    4.2 Consolidated Revenue and Operating Profit (Quarterly) Consol. revenue Consol. operating profit （¥ mil） （¥ mil） 25,000 10,000 20,000 8,000 15,000 6,000 10,000 4,000 5,000 2,000 0 0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY2022 11,857 12,201 12,897 13,341 FY2022 4,116 4,159 4,511 3,461 FY2023 14,813 15,641 16,54

  32. Slide 32: 4.3.1 Revenue by Business Model (YoY)

    4.3.1 Revenue by Business Model (YoY) Initial declined from high base effect, spread growth improved to 21.1% % YoY Factors* (¥ mil) 20,295 Q1 FY2024 Q1 FY2025 20,000 Spread +15.4% +21.1% ＋ Online payment (GMO-PG) 17,785 ＋ Overseas lending ＋ CP payment 8,464 15,000 － Payment after Delivery 6,988 － O

  33. Slide 33: 4.3.2 Consolidated Revenue by Business Model (Quarterly)

    4.3.2 Consolidated Revenue by Business Model (Quarterly) （¥ mil） 8,464 8,000 7,424 7,222 6,988 6,889 7,000 6,265 6,057 6,025 6,171 5,990 6,000 5,702 5,371 5,415 5,296 5,297 5,267 5,292 5,093 5,000 4,707 4,731 4,773 4,665 4,311 4,430 4,257 3,840 2,408 3,098 4,000 2,764 3,536 2,922 3,395 2,288 2,719 3

  34. Slide 34: 4.4.1 FinTech Related Asset (Quarterly Trend)

    4.4.1 FinTech Related Asset (Quarterly Trend) FinTech related asset （¥ mil） 140,000 120,000 % YoY 100,000 +4.4% 80,000 60,000 +10.4% 40,000 20,000 +40.0% 0 End-Q2 End-Q3 End-Q4 End-Q1 End-Q2 End-Q3 End-Q4 End-Q1 End-Q2 End-Q3 End-Q4 End-Q1 End-Q2 End-Q3 End-Q4 End-Q1 FY2021 FY2021 FY2021 FY2022 FY20

  35. Slide 35: 4.4.2 FinTech Revenue and Profits (Quarterly Trend)

    4.4.2 FinTech Revenue and Profits (Quarterly Trend) FinTech revenues and profit （¥ mil） 4,500 4,000 % YoY ＋30.8% 3,500 3,000 2,500 ＋7.3% 2,000 1,500 ＋59.9% 1,000 -7.7% 500 ＋33.2% 0 Q2 FY2021 Q3 FY2021 Q4 FY2021 Q1 FY2022 Q2 FY2022 Q3 FY2022 Q4 FY2022 Q1 FY2023 Q2 FY2023 Q3 FY2023 Q4 FY2023 Q1 FY2024

  36. Slide 36: 4.5.1 Consolidated CoS and SG&A Ratio (Quarterly Trend)

    4.5.1 Consolidated CoS and SG&A Ratio (Quarterly Trend) Cost of sales ratio fluctuates depending on revenue mix (¥ mil) 20,295 20,000 19,588 18,313 18,096 17,785 50.0% 18,000 16,546 16,118 15,641 16,000 40.9% 14,813 38.5% 40.0% 37.5% 12,201 37.2% 37.0% 36.6% 14,000 12,897 36.0% 34.8% 34.6% 34.7% 13,

  37. Slide 37: 4.5.2 CoS/SGA Ratio of GMO-PG & GMO-EP (Quarterly Trend)

    4.5.2 CoS/SGA Ratio of GMO-PG & GMO-EP (Quarterly Trend) CoS ratio trending stably for online payment business (¥ mil) 12,161 12,000 11,449 10,681 50.0% 10,511 10,158 10,000 9,564 9,219 9,177 41.2% 9,083 40.0% 8,498 7,977 36.6% 35.6% 8,000 7,682 7,906 33.3% 40.7% 34.1% 34.2% 6,878 7,122 6,858 31.6%

  38. Slide 38: 4.6.1 Operating Stores, TRX Volume and Value

    4.6.1 Operating Stores, TRX Volume and Value Consol. TRX value reaches approx. ¥19.8 trn for the past 12 months Operating TRX Volume*2*3 TRX Value*2 Stores*1/IDs*2 End-Q1 FY2025 Q1 FY2025 Past 12-mnth Q1 FY2025 Past 12-mnth - 2.10 bn 7.74 bn ¥5.5 trn ¥19.8 trn Consolidated % YoY - +19.2% +18.9% +24.

  39. Slide 39: 4.6.2 Distribution of Major Sectors (Q1 FY2025)

    4.6.2 Distribution of Major Sectors (Q1 FY2025) Balance both stability and growth through sector diversification Revenue share by industry (vertical axis)/ Revenue growth rate (horizontal axis)* Revenue (Based on actual figures for Q1 FY2025) proportion The size of the circle represents the TRX valu

  40. Slide 40: 4.7.1 Consolidated Cash Flow Statement (Cumulative)

    4.7.1 Consolidated Cash Flow Statement (Cumulative) （¥ mil） Q1 FY2025 (¥ mil) 50,000 Operating CF ： +23,782 Pretax profit +7,587 Deprec. & Amort. +902 40,000 Trade and other receivables -2,248 Advances paid -13,990 Accrued revenues -6,558 30,000 Trade payables +419 Accrued expenses +7,770 Deposits r

  41. Slide 41: 4.7.2 Major Factors Affecting Consolidated Cash Flow Statement

    4.7.2 Major Factors Affecting Consolidated Cash Flow Statement Related liabilities & assets Impact from business expansion Payment Processing Business Sales proceeds of Deposits received Liability Operating CF merchants under the (liability) Yearly fluctuations can be large as annual TRX value of Re

  42. Slide 42: 4.8 Consolidated EBITDA and EBITDA Margin (Quarterly)

    4.8 Consolidated EBITDA* and EBITDA Margin (Quarterly) （¥ mil） 9,000 100.0% 8,157 90.0% 8,000 7,720 7,633 80.0% 7,000 6,594 6,588 6,289 70.0% 6,000 5,853 5,657 60.0% 5,060 4,932 5,000 4,688 50.0% 4,042 42.7% 4,000 41.7% 40.2% 38.4% 39.2% 38.2% 37.4% 38.0% 37.1% 40.0% 33.6% 3,000 30.3% 30.6% 30.0% 2,

  43. Slide 43: Thank You Very Much

    Thank You Very Much GMO Payment Gateway, Inc. (3769; Tokyo Stock Exchange Prime) For inquiries or requests for 1-on-1 interviews, please contact the IR Department, Corporate Value Creation Strategy Division, at the telephone number below: TEL ： +81-3-3464-0182 E-mail ： ir-contact@gmo-pg.com IR Websi

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