Softbank Group Corp. · TSE:9984
Softbank — H1 FY2019 Earnings Presentation
89 slides from Softbank's earnings presentation, Nov 6, 2019
Slide 1: Earnings Results for the 6-month Period ended September 30, 2019
Earnings Results for the 6-month Period ended September 30, 2019 November 6, 2019
Slide 2: Important Information
IMPORTANT INFORMATION This presentation (this “Presentation”) is furnished to you for informational purposes in connection with the interests of SoftBank Group Corp. (together with its affiliates, “SoftBank”) and is not, and may not be relied on in any manner as, legal, tax, investment, accounting o
Slide 3: Disclaimer
Disclaimer This material was prepared based on information available and views held at the time it was made. Statements in this material that are not historical facts, including, without limitation, plans, forecasts and strategies are “forward-looking statements”. Forward-looking statements are by t
Slide 4: !2
!2
Slide 5: Significant decrease in profit WeWork problem
Significant WeWork decrease in profit problem !3
Slide 6: SoftBank Consolidated Results
Consolidated SoftBank Results
Slide 7: Consolidated Results
Consolidated Results (JPY bn) FY18H1 FY19H1 Change YoY Net sales 4,653.9 4,651.7 -2.2 -0% EBIT 1,420.7 -15.6 -1,436.3 - Net income 840.1 421.6 -418.5 -50% Net income: net income to attributable to owners of the parent !5
Slide 8: Net Sales
Net Sales (JPY bn) 4,653.9 4,651.7 1,824.0 1,735.1 Sprint 2,228.3 2,373.3 SoftBank segment 601.5 543.3 Others FY18H1 FY19H1 Others = Arm + Brightstar + “Others” + reconciliations !6
Slide 9: EBIT
EBIT (JPY bn) One-time gain from 1,420.7 Arm China (176.3) 193.3 632.4 102.5 Sprint SoftBank 524.1 560.9 segment 105.4 Others -106.3 -15.6 -572.6 SVF segment One-time gain from Arm China: On Jun. 26, 2018, Arm sold 51% of its equity interest in its wholly-owned Chinese subsidiary, Arm China to certa
Slide 10: Net Income
Net Income (JPY bn) 840.1 421.6 FY18H1 FY19H1 Net income: net income to attributable to owners of the parent !8
Slide 11: Impact of WeWork to SBG Consolidated Results
Impact of WeWork to SBG Consolidated Results Please refer to visionfund.com/portfolio for a complete list of SVF1's investments. !9
Slide 12: Impact on SBG Consolidated Results from WeWork (1)
Impact on SBG Consolidated Results from WeWork (1) WeWork Change in FV SVF segment By SVF1 operating USD 3.0bn income and loss Cumulative investment amount (as of Sep. 30, 2019) (note) WeWork: The We Company (WeWork Parent Co.) USD 3.0bn: acquisition cost (SBG consolidated basis). As a result of int
Slide 13: Impact on SBG Consolidated Results from WeWork (2)
Impact on SBG Consolidated Results from WeWork (2) WeWork USD 9.0bn * Warrants held by SBG USD 1.5bn Change in FV Non-operating By SBG income (loss) USD 4.5bn SVF segment By SVF1 operating USD 3.0bn income and loss Cumulative investment amount (as of Sep. 30, 2019) (note) WeWork: The We Company (WeW
Slide 14: Impact on SBG Consolidated Results from WeWork (3)
Impact on SBG Consolidated Results from WeWork (3) WeWork WeWork Joint Ventures (Three affiliates) USD 9.0bn * Warrants held by SBG USD 1.5bn Change in FV Non-operating By SBG income (loss) USD 4.5bn Change in FV SVF segment SVF segment By SVF1 operating operating USD 3.0bn income and loss By SVF1 i
Slide 15: Impact of WeWork Held by SVF1 (1)
Impact of WeWork Held by SVF1 (1) USD 3.0bn Cumulative investment amount (SVF1 only) USD 3.0bn: acquisition cost (SBG consolidated basis). As a result of inter-group transaction, SVF1’s acquisition cost is USD 3.1bn Cumulative investment amounts do not reflect current valuations associated with such
Slide 16: Impact of WeWork Held by SVF1 (2)
Impact of WeWork Held by SVF1 (2) USD 4.0bn USD 3.0bn Cumulative FV as of investment amount Jun. 30, 2019 (SVF1 only) USD 3.0bn: acquisition cost (SBG consolidated basis). As a result of inter-group transaction, SVF1’s acquisition cost is USD 3.1bn Cumulative investment amounts do not reflect curren
Slide 17: Impact of WeWork Held by SVF1 (3)
Impact of WeWork Held by SVF1 (3) USD 4.0bn USD 3.0bn (note) Oct. 22, 2019: Eastern standard time USD 1.0bn USD 3.0bn: acquisition cost (SBG consolidated basis). As a result of inter-group transaction, SVF1’s acquisition cost is USD 3.1bn Cumulative investment amounts do not reflect current valuatio
Slide 18: Impact of WeWork Held by SVF1 (4)
Impact of WeWork Held by SVF1 (4) USD 4.0bn USD 3.0bn SVF segment operating income and loss (as of FY19Q2) USD -3.0bn (note) Oct. 22, 2019: Eastern standard time USD 1.0bn USD 3.0bn: acquisition cost (SBG consolidated basis). As a result of inter-group transaction, SVF1’s acquisition cost is USD 3.1
Slide 19: Impact of WeWork Joint Ventures Held by SVF1 (1)
Impact of WeWork Joint Ventures (Three affiliates) Held by SVF1 (1) SVF segment operating income and los USD 1.3bn FV as of Jun. 30, 2019 * (SVF1 only) Cumulative investment amounts do not reflect current valuations associated with such investments and are not indicative of actual performance. Valua
Slide 20: Impact of WeWork Joint Ventures Held by SVF1 (2)
Impact of WeWork Joint Ventures (Three affiliates) Held by SVF1 (2) SVF segment operating income and los USD 1.3bn USD 1.5bn USD 0.2bn FV as of Jul. - Sep. 2019 *1 Jun. 30, 2019 (additional investment) *2 (SVF1 only) Cumulative investment amounts do not reflect current valuations associated with suc
Slide 21: Impact of WeWork Joint Ventures Held by SVF1 (3)
Impact of WeWork Joint Ventures (Three affiliates) Held by SVF1 (3) SVF segment operating income and los With consideration of transaction (announced on Oct. 22, 2019) USD 1.3bn USD 1.5bn USD 0.2bn USD 1.1bn FV as of Jul. - Sep. 2019 FV as of *1 Jun. 30, 2019 (additional investment) Sep. 30 2019 *2
Slide 22: Impact of WeWork Joint Ventures Held by SVF1 (4)
Impact of WeWork Joint Ventures (Three affiliates) Held by SVF1 (4) SVF segment operating income and los With consideration of transaction (announced on Oct. 22, 2019) SVF segment USD 1.3bn USD 1.5bn operating USD 0.2bn USD 1.1bn income and loss (as of FY19Q2) USD -0.4bn FV as of Jul. - Sep. 2019 FV
Slide 23: Impact of WeWork Held by SBG (1)
Impact of WeWork Held by SBG (1) USD 6.0bn Warrants*1 USD 1.5bn Cumulative investment amounts do not reflect current valuations associated with such investments and are USD 4.5bn not indicative of actual performance. Valuations reflect unrealized estimated amounts and should not be construed as indi
Slide 24: Impact of WeWork Held by SBG (2)
Impact of WeWork Held by SBG (2) USD 6.0bn USD 6.0bn Warrants*1 Warrants USD 1.5bn USD 1.3bn USD 4.7bn Cumulative investment amounts do not reflect current valuations associated with such investments and are USD 4.5bn not indicative of actual performance. Valuations reflect unrealized estimated amou
Slide 25: Impact of WeWork Held by SBG (3)
Impact of WeWork Held by SBG (3) USD 6.0bn USD 6.0bn Warrants*1 Warrants USD 1.5bn USD 1.3bn USD 4.7bn Cumulative investment amounts do not reflect current valuations associated with such investments and are USD 4.5bn not indicative of actual performance. Valuations reflect unrealized estimated amou
Slide 26: Impact of WeWork Held by SBG (4)
Impact of WeWork Held by SBG (4) USD 6.0bn USD 6.0bn Warrants*1 Warrants USD 1.5bn USD 1.3bn Non-operating income (loss) (as of FY19Q2) USD -4.7bn USD 4.7bn Cumulative investment amounts do not reflect current valuations associated with such investments and are USD 4.5bn not indicative of actual per
Slide 27: Two Facts
Two Facts !25
Slide 28: Two Facts
Two Facts SBG shareholder value SVF1 investment market uplift ~JPY 1.4t +USD 11.4bn *1 increase (since SVF1 inception) *2 !26 SVF1 highlights are provided solely for illustrative purposes and individual investors' results may vary. Past performance is not necessarily indicative of future results. Sh
Slide 29: Two Facts
Two Facts SBG shareholder value SVF1 investment market uplift ~JPY 1.4t +USD 11.4bn *1 increase (since SVF1 inception) *2 !27 SVF1 highlights are provided solely for illustrative purposes and individual investors' results may vary. Past performance is not necessarily indicative of future results. Sh
Slide 30: Shareholder Value
Earnings Results Briefing for FY2018 (may 9, 2019 Shareholder Value
Slide 31: SOTP (As of August 7, 2019, Previous Announcement)
• For details, see “Definition and Calculation Method of SBG’s Sum-of-the-parts Valuation” SOTP (As of August 7, 2019, Previous Announcement) (USD bn) 237 Others 8 SVF 32 45 24 27 43 192 104 Equity value of Net debt Shareholder USD 1 = JPY 108.84 holdings value Share price: closing price as of Aug.
Slide 32: SOTP (As of Nov. 6, 2019)
• For details, see “Definition and Calculation Method of SBG’s Sum-of-the-parts Valuation” SOTP (As of Nov. 6, 2019) Shareholder value (USD bn) 256 Others 7 USD 13bn increase SVF 29 50 25 29 44 206 123 Equity value of Net debt Shareholder USD 1 = JPY 108.84 holdings value Share price: closing price
Slide 33: Equity Value of Holdings +USD 19bn
• For details, see “Definition and Calculation Method of SBG’s Sum-of-the-parts Valuation” Equity Value of Holdings 256 (USD bn) 237 7 Others 8 29 SVF 32 +USD 25 24 29 27 19bn 44 43 123 104 Aug. 7, 2019 Nov. 6, 2019 USD 1 = JPY 108.84 Share price: closing price as of Nov. 6 (Japan) (as of previous a
Slide 34: Shareholder Value +USD 13bn
• For details, see “Definition and Calculation Method of SBG’s Sum-of-the-parts Valuation” Shareholder Value (USD bn) 206 192 +USD 13bn Aug. 7, 2019 Nov. 6, 2019 USD 1 = JPY 108.84 Share price: closing price as of Nov. 6 (Japan) (as of previous announcement) closing price as of Nov. 5 (U.S.) !32
Slide 35: Two Facts
Two Facts SBG shareholder value SVF1 investment market uplift ~JPY 1.4t +USD 11.4bn *1 increase (since SVF1 inception) *2 !33 SVF1 highlights are provided solely for illustrative purposes and individual investors' results may vary. Past performance is not necessarily indicative of future results. Sh
Slide 36: SVF1 Cumulative Investment Highlights (end of Sep. 2019)
SVF1 Cumulative Investment Highlights (end of Sep. 2019) USD 17.2bn Realized gain USD 4.7bn Valuation gain USD 12.5bn Mark up (37 companies) SVF1 highlights are provided solely for illustrative purposes and individual investors' results may vary. Past performance is not necessarily indicative of fut
Slide 37: SVF1 Cumulative Investment Highlights (end of Sep. 2019)
SVF1 Cumulative Investment Highlights (end of Sep. 2019) USD 17.2bn Realized gain USD 4.7bn Valuation gain USD -5.8bn USD 12.5bn Mark up Mark down (37 companies) (22 companies) SVF1 highlights are provided solely for illustrative purposes and individual investors' results may vary. Past performance
Slide 38: SVF1 Cumulative Investment Highlights (end of Sep. 2019)
SVF1 Cumulative Investment Highlights (end of Sep. 2019) USD 17.2bn Realized gain USD 4.7bn Investment market uplift USD 11.4bn Valuation gain USD -5.8bn USD 12.5bn Mark up Mark down (37 companies) (22 companies) SVF1 highlights are provided solely for illustrative purposes and individual investors'
Slide 39: SVF1 Cumulative Investment Highlights (end of Sep. 2019)
SVF1 Cumulative Investment Highlights (end of Sep. 2019) Investment USD 11.4bn market uplift Cumulative USD 76.3bn investment cost * (Since SVF1 inception) Cumulative investment cost and aggregate market uplift include Flipkart, Nvidia, and Guardant Health, which were exited in August 2018 and Janua
Slide 40: SBIA Valuation Framework & Governance
SBIA Valuation Framework & Governance Reporting framework International private equity & venture capital Regulatory compliance Other applicable regulators Valuers / Auditors Auditor Leading international Established valuation accounting firms specialists Complying with global / industry standards Al
Slide 41: SBIA Valuation Process
SBIA Valuation Process Industry leading two firms appointed by IAB Independent Valuation Valuation Audit Audit SVF F/S including Advisory Review valuation process Valuations & Financial IAB Risk Committee Investor Advisory Board (Board members are SVF1 major Limited Partners) !39 This is the SBIA Va
Slide 42: WeWork
WeWork Please refer to visionfund.com/portfolio for a complete list of SVF1's investments. !40
Slide 43: Reduced Exercise Price of Existing Commitment: USD 1.5bn
Reduced Exercise Price of Existing Commitment: USD 1.5bn Before exercise After exercise Acceleration of Apr. 2020 exercised to Oct. 2019 Exercise USD 110 / Reduced USD 11.60 / share share substantially price (Valuation at USD 47bn) Valuation based on the price of warrant: post-money There can be no
Slide 44: Financing for WeWork
Financing for WeWork Support for letter of credit facility from financial institutions *1 Obtain warrants as consideration for the financing *2 Unsecured notes Preparing a loan facility (17%) USD 2.2bn from SBG to WeWork Senior secured notes USD 1.1bn *1 Credit support details are currently under di
Slide 45: Ownership of SoftBank Group: Tender offer worth up to USD 3bn
Ownership of SoftBank Group *1 Before transaction After transaction *2 *2 12.8% 41.2% (average acquisition cost: USD 89.40/share) (average acquisition cost: USD 19.38/share) Tender offer worth up to USD 3bn scheduled to be held at USD 19.19 / share *1 Excludes the $3 billion tender offer at $19.19 p
Slide 46: Optimization of governance
Marcelo Claure appointed as Executive Chairman of the Board of Directors Optimization of governance *Adam Neumann, the founder of the company, will become a Board observer. *The size of the Board will be expanded and it will receive voting control over Mr. Neumann’s shares. !44
Slide 47: WeWork Business
WeWork Business Please refer to visionfund.com/portfolio for a complete list of SVF1's investments. !45
Slide 48: Hypothetical Illustration of EBITDA
Hypothetical Illustration of EBITDA 0 Negative The information presented herein is provided for purely hypothetical, illustrative purposes only. Information herein reflect current beliefs of SBG as of the date hereof and is based on a variety of assumptions and estimates that are subject to various
Slide 49: Hypothetical Illustration of Factors of EBITDA
Hypothetical Illustration of Factors of EBITDA Gross profit (Location-level) OPEX EBITDA − = Low High Negative The information presented herein is provided for purely hypothetical, illustrative purposes only. Information herein reflect current beliefs of SBG as of the date hereof and is based on a v
Slide 50: Hypothetical Illustration of Factors of EBITDA
Hypothetical Illustration of Factors of EBITDA Gross profit (Location-level) OPEX EBITDA − = The information presented herein is provided for purely hypothetical, illustrative purposes only. Information herein reflect current beliefs of SBG as of the date hereof and is based on a variety of assumpti
Slide 51: Workstation Capacity (Illustration)
Workstation Capacity (Illustration) Approximately doubled each year Year 1 Year 2 Year 3 The information presented herein is provided for illustrative purposes only. Information herein reflect current beliefs of SBG as of the date hereof and is based on a variety of assumptions and estimates that ar
Slide 52: Hypothetical Illustration of Number of Locations (Current)
Hypothetical Illustration of Number of Locations (Current) Under construction Most locations 1-6 months opened within Loss (expected) Low profit (expected) 7-12 months High profit (expected) 6 months 13 months+ Current expectation Months: months since the opening The information presented herein is
Slide 53: Hypothetical Illustration of Occupancy Rate
Hypothetical Illustration of Occupancy Rate 100% 90% 80% Seek to 70% 60% Improve 50% 40% over time 30% Loss Low profit High profit Gross profit 20% 10% 0% 0 2 4 6 8 10 12 14 16 18 20 22 24 (Months since the opening) The information presented herein is provided for purely hypothetical, illustrative p
Slide 54: Proposed Measures to Improve Profitability
Proposed Measures to Improve Profitability Pause contracting new offices Cost reduction Sort out unprofitable business There can be no assurance that the strategy of SBG set forth herein will be successful. !52
Slide 55: Hypothetical Illustration of Location Profitability Over Time (Future)
Hypothetical Illustration of Location Profitability Over Time (Future) Expect to Increase in ratio of high profit location Under Construction Loss (1-6 months) Low Profit (7-12 months) High profit (13 months+) Potential Potential Potential Potential Potential year 1 1H year 1 2H year 2 1H year 2 2H
Slide 56: Hypothetical Illustration of Profitability
Hypothetical Illustration of Profitability (Amount) Gross profit (after improvement) This hypothetical illustration is provided solely for illustrative purposes, reflects the current beliefs of SBG as of the date hereof, and is based on a variety of assumptions and estimates about, among others, fut
Slide 57: Hypothetical Illustration of Profitability
Hypothetical Illustration of Profitability (Amount) Gross profit EBITDA OPEX (before reduction) This hypothetical illustration is provided solely for illustrative purposes, reflects the current beliefs of SBG as of the date hereof, and is based on a variety of assumptions and estimates about, among
Slide 58: Hypothetical Illustration of Profitability
Hypothetical Illustration of Profitability (Amount) Aim for reduction of new location related cost Gross profit (interior, etc.) EBITDA OPEX (after reduction) This hypothetical illustration is provided solely for illustrative purposes, reflects the current beliefs of SBG as of the date hereof, and i
Slide 59: Hypothetical Illustration of EBITDA
Hypothetical Illustration of EBITDA 0 Negative The information presented herein is provided for purely hypothetical, illustrative purposes only. Information herein reflect current beliefs of SBG as of the date hereof and is based on a variety of assumptions and estimates that are subject to various
Slide 60: Hypothetical Illustration of EBITDA
Hypothetical Illustration of EBITDA 0 Aim to achieve Turnaround Future The information presented herein is provided for purely hypothetical, illustrative purposes only. Information herein reflect current beliefs of SBG as of the date hereof and is based on a variety of assumptions and estimates that
Slide 61: Assessing Value for Investments
Assessing Value for Investments This section is designed for illustrative purposes only to demonstrate a personal view of assessing value in a potential investment company. For the avoidance of doubt, the slides in this section do not purport to describe the valuations process conducted by SoftBank
Slide 62: Our policy on portfolio companies' support
Our policy on portfolio companies’ support Portfolio company finances to be No rescue self-financing package !60
Slide 63: Firmly Maintain Financial Policy
Firmly Maintain Financial Policy Manage LTV at less than 25% during “normal” periods 1 (upper threshold of 35% even during “abnormal” periods) Maintain cash position covering 2 bond redemptions for at least next 2 years Secure sustainable distribution and dividend income 3 from SVF and other subsidi
Slide 64: Key KPI for evaluating enterprise value: FCF
Key KPI for evaluating enterprise value FCF FCF: free cash flow The information presented herein is provided for illustrative purposes only and represents a high level overview of assessing company value. Investments held by SVF1 are valued in accordance with the detailed procedures established in t
Slide 65: Factors for Assessing Value
Factors for Assessing Value Company FCF × Multiple = value FCF: free cash flow The information presented herein is provided for illustrative purposes only and represents a high level overview of assessing company value. Investments held by SVF1 are valued in accordance with the detailed procedures e
Slide 66: Factors for Assessing Company Value (2020 Projections)
Factors for Assessing Company Value (2020 Projections) 45x 15x Alibaba Group is a SoftBank Group Corp. investment. These companies are not necessarily portfolio companies owned by the SVF1 or SoftBank Group Corp. The information presented herein is provided for illustrative purposes only and represe
Slide 67: EV / FCF (2021 projections)
EV / FCF (2021 projections) (multiple) 50x 40x 30x 25x Square Amazon Tencent 20x Booking Facebook Alibaba Alphabet Netflix 10x 30% 0x 0% 10% 20% 30% 40% Revenue CAGR (2019-2021 projections) EV: enterprise value (source) S&P Capital IQ Alibaba Group is a SoftBank Group Corp. investment. These compani
Slide 68: Hypothetical 5-year projections: how we see value in a company
EV / FCF (2021 projections) Hypothetical 5-year projections: (multiple) how we see value in a company 50x (revenue CAGR 30%) Assumptions Amount 40x FCF USD 1bn 30x 25x Square 20x Amazon Tencent FCF multiple (25x) USD 25bn Booking Facebook Alibaba Alphabet 10x Netflix DCF (discount rate 30%) USD 7bn
Slide 69: Hypothetical 7-year projections: how we see value in a company
EV / FCF (2021 projections) Hypothetical 7-year projections: (multiple) how we see value in a company 50x (revenue CAGR 30%) Assumptions Amount 40x FCF USD 2bn 30x 25x Square 20x Amazon Tencent FCF multiple (25x) USD 50bn Booking Facebook Alibaba Alphabet 10x Netflix DCF (discount rate 30%) USD 8bn
Slide 70: !68
!68
Slide 71: Alibaba, Local Services, JVs / affiliates
Alibaba Local Services + JVs / affiliates etc. (14 companies) (Zuoyebang) The investments presented herein are solely for illustrative purposes, have been selected in order to demonstrate examples of SVF1 investments, and do not purport to be a complete list thereof. References to investments includ
Slide 72: Internet
Internet Market cap. of 22x Internet companies ’95 ’96 ’97 ’98 ’99 ’00 (CY) Index assuming the market cap. of the Internet companies in 1994 was 1 (source) Market cap. of the internet companies: estimated by SoftBank Group Corp. based on S&P Capital IQ !70
Slide 73: Internet
Internet 22x Market cap. of Internet companies 12x ’95 ’96 ’97 ’98 ’99 ’00 (CY) Index assuming the market cap. of the Internet companies in 1994 was 1 (source) Market cap. of the internet companies: estimated by SoftBank Group Corp. based on S&P Capital IQ !71
Slide 74: Internet
Internet 22x 84PB Internet traffic Market cap. of Internet companies 12x ’95 ’96 ’97 ’98 ’99 ’00 (CY) *1 Petabyte (PB) = 1 million GB Index assuming the market cap. of the Internet companies in 1994 was 1 Net traffic: calculated per month (source) Internet traffic: Cisco VNI (Visual Networking Index
Slide 75: Internet
Internet Market cap. of Internet companies 1,000x 156EB Internet traffic ’95 ’99 ’03 ’07 ’11 ’15 ’18 (CY) *1 Exabyte (EB) = 1 billion GB Index assuming the market cap. of the Internet companies in 1994 was 1 Net traffic: calculated per month (source) Internet traffic: Cisco VNI (Visual Networking In
Slide 76: Internet AI
Internet AI Market cap. of Internet companies Aggregated valuation of 1,000x AI companies 156EB 17x Internet traffic ? ’95 ’99 ’03 ’07 ’11 ’15 ’18 (CY) ’13 ’14 ’15 ’16 ’17 ’18 ’19 (CY) *1 Exabyte (EB) = 1 billion GB Index assuming the market cap. of the Internet companies in 1994 was 1 Net traffic:
Slide 77: Internet AI
Internet AI Market cap. of Internet companies Aggregated valuation of Amount of 1,000x AI companies stored digital data 156EB 17x 33ZB Internet traffic ? ’95 ’99 ’03 ’07 ’11 ’15 ’18 (CY) ’13 ’14 ’15 ’16 ’17 ’18 ’19 (CY) *1 Exabyte (EB) = 1 billion GB Index assuming the market cap. of the Internet co
Slide 78: Internet AI
Internet AI Market cap. of Aggregated Internet Amount of stored digital data valuation of companies (illustration) AI companies 1,000x (illustration) 156EB Internet traffic ’95 ’99 ’03 ’07 ’11 ’15 ’18 (CY) ’13 ’16 ’19 ’22 ’25 ’28 ’30 (CY) *1 Exabyte (EB) = 1 billion GB Index assuming the market cap.
Slide 79: AI revolution has just started
A I revolution has just started !77
Slide 80: Conclusion
Conclusion !78
Slide 81: Two Facts
Two Facts SBG shareholder value SVF1 investment market uplift ~JPY 1.4t +USD 11.4bn *1 increase (since SVF1 inception) *2 !79 SVF1 highlights are provided solely for illustrative purposes and individual investors' results may vary. Past performance is not necessarily indicative of future results. Sh
Slide 82: Equity Value of Holdings +USD 19bn
• For details, see “Definition and Calculation Method of SBG’s Sum-of-the-parts Valuation” Equity Value of Holdings 256 (USD bn) 237 7 Others 8 29 SVF 32 +USD 25 24 29 27 19bn 44 43 123 104 Aug. 7, 2019 Nov. 6, 2019 USD 1 = JPY 108.84 Share price: closing price as of Nov. 6 (Japan) (as of previous a
Slide 83: Shareholder Value +USD 13bn
• For details, see “Definition and Calculation Method of SBG’s Sum-of-the-parts Valuation” Shareholder Value (USD bn) 206 192 +USD 13bn Aug. 7, 2019 Nov. 6, 2019 USD 1 = JPY 108.84 Share price: closing price as of Nov. 6 (Japan) (as of previous announcement) closing price as of Nov. 5 (U.S.) !81
Slide 84: LTV
• Net debt = SBG net interest-bearing debt = SBG gross debt - SBG cash positions, etc • LTV (Loan to value) = Net debt / Equity value of holdings • For details, see “Definition and Calculation Method of SBG’s Sum-of-the-parts Valuation” LTV 17% Share price: closing price as of Nov. 6 (Japan) (note)
Slide 85: SVF1 Cumulative Investment Highlights (end of Sep. 2019)
SVF1 Cumulative Investment Highlights (end of Sep. 2019) USD 17.2bn Realized gain USD 4.7bn Investment market uplift USD 11.4bn Valuation gain USD -5.8bn USD 12.5bn Mark up Mark down (37 companies) (22 companies) SVF1 highlights are provided solely for illustrative purposes and individual investors'
Slide 86: SBG shareholder value vs market cap
SBG shareholder USD 206bn value Discount 60% USD 82bn Market cap. USD 1 = JPY 108.84 (FY) ’95 ’97 ’99 ’01 ’03 ’05 ’07 ’09 ’11 ’13 ’15 ’17 ’19 SBG Market cap.: closing price as of Nov. 6 Shareholder value: closing price as of Nov. 6 (Japan) !84 closing price as of Nov. 5 (U.S.)
Slide 87: No Change in Our Journey
No Change in Our Journey !85
Slide 88: SoftBank
SoftBank
Slide 89: Definition and Calculation Method of SBG's Sum-of-the-parts Valuation
Definition and Calculation Method of SBG’s Sum-of-the-parts Valuation i. Net debt • Net debt = net interest-bearing debt (SBG) = Net debt (SBG) • Net debt (SBG) = gross debt (SBG) - cash position, etc (SBG) • gross debt (SBG) = gross interest-bearing debt (SBG) = Gross debt (Consolidated) - Gross de