Softbank Group Corp. · TSE:9984
Softbank — FY2023 Earnings Presentation
34 slides from Softbank's earnings presentation, May 13, 2024
Slide 1: Earnings Results for the Fiscal Year Ended March 31, 2024
Earnings Results for the Fiscal Year Ended March 31, 2024 Investor Briefing May 13, 2024 SoftBank Group Corp.
Slide 2: Disclaimers
Disclaimers This presentation provides relevant information about SoftBank Group Corp. (“SBG”) and its subsidiaries (together with SBG, the “Company”) and its affiliates (together with the Company, the “Group”) and does not constitute or form any solicitation of investment including any offer to buy
Slide 3: Exchange rates and abbreviations
Exchange rates per JPY used for translation FY2022 FY2023 Average during quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1 USD 129.04 138.68 141.16 133.26 138.11 145.44 147.00 147.87 EOQ Jun 30 Sep 30 Dec 31 Mar 31 Jun 30 Sep 30 Dec 31 Mar 31 1 USD 133.53 151.41 Abbreviations Abbreviations used in Accounting and Fi
Slide 4: Accounting
Accounting
Slide 5: Consolidated Results
Consolidated Results (¥ B) FY22 FY23 Change Change % Net sales 6,570.4 6,756.5 +186.1 +2.8% Income before -469.1 57.8 +526.9 ー income tax Net income (attributable to owners of the -970.1 -227.6 +742.5 ー parent) (Reference) Loss on investments -835.1 -559.4 +275.7 ー Investment Business of Holding Com
Slide 6: Net Income & SVF Segment Income
Net Income & SVF Segment Income 3,033.6 950.0 (¥ B) 422.7 Net income 61.0 231.1 -57.6 SVF segment income (income before income tax) -660.1 -96.7 -297.5 -258.9 • Includes investment gain/loss in Arm shares -1,019.9 -477.6 • After considering third-party interests -783.4 -931.1 -2,330.8 -3,162.7 Q1 Q2
Slide 7: Investment Business of Holding Companies Segment
Investment Business of Holding Companies Segment (¥ B) P/L item FY22 FY23 FY23 Main Items Gain/loss on investments at Investment Business of Holding Companies 4,560.6 -459.0 Gain relating to settlement of prepaid forward contracts using Alibaba shares 4,838.3 ― Gain/loss relating to sales of T-Mobil
Slide 8: Acquisition of T-Mobile Shares for No Additional Consideration
Acquisition of T-Mobile Shares for No Additional Consideration Contingent consideration The condition of 45-day trailing VWAP of T-Mobile share (Part of consideration for the merger between Sprint and T-Mobile) ≧ $149.35 was satisfied on Dec 22, 2023 Acquired 48.8M T-Mobile shares for no additional
Slide 9: T-Mobile: Shareholding & Fair Values
T-Mobile: Shareholding & Fair Values includes shares subject to unexercised Deutsche Telekom’s call options Held 92.1M T-Mobile shares T-Mobile share price $160.33 $163.22 at FY23Q4, up 52.3M shares $144.84 from FY22Q4 $138.90 $140.05 $1,036M Received 3.6M shares upon vesting (¥154.5B) contingent
Slide 10: Deutsche Telekom: Shareholding & Fair Values
Deutsche Telekom: Shareholding & Fair Values Acquired 225M Deutsche Deutsche Telekom share price Telekom shares in Sep 2021 €22.35 €21.75 €22.50 in return for the sale of T-Mobile shares €19.98 €19.87 $6M (¥6.1B) valuation gain for FY23 Fair value of Deutsche Telekom shares ($ M) (i) DT shares (ii
Slide 11: Alibaba Shares & Derivative Financial Assets/Liabilities
Alibaba Shares & Derivative Financial Assets/Liabilities (Amount Recorded in B/S) Value of Alibaba shares Derivative financial Investment securities (FVTPL) recorded in B/S assets/liabilities (net) considering prepaid Alibaba share price forward contracts: $102.18 $102.18 $30,462M ( A + B ) Of valua
Slide 12: SoftBank Vision Funds Segment
SoftBank Vision Funds Segment (¥ B) P/L FY22 FY23 FY23 Main Items In consolidated P/L, loss on investments at SoftBank Vision Gain/loss on investments at SoftBank Vision Funds -5,279.5 724.3 Funds was ¥167.3B (see p10) ¥768.9B gain at SVF1, ¥146.5B loss at SVF2 Gain/loss on investments at SVF1, SVF2
Slide 13: Difference between Segment Results and Consolidated P/L
Difference between Segment Results and Consolidated P/L (i) Investment gains/losses related to subsidiaries, mainly Arm and PayPay, are included in “gain/loss on investments at SoftBank Vision Funds” (segment information), but are eliminated in consolidations and excluded from “gain/loss on investme
Slide 14: Investment Performance of SVF1 and SVF2
(Reference) Investment Performance of SVF1 and SVF2 ($ B) Since Inception FY23*1 Gain/loss Gain/loss Cost*2 Returns*2 Gain/loss Q4 YTD SVF1 89.6 106.3 16.7 0.0 5.3 Exited investments 38.0 64.1 26.1 0.4 7.3 Investments before exit 51.6 39.9 -11.7 -0.1 -0.6 Reversal of previously-recorded valuation ga
Slide 15: Status of Investment and Financial Support for WeWork
Status of Investment and Financial Support for WeWork (Cumulative) ($ M) Cumulative acquisition cost as of Mar 2024 Cumulative cash flows (SBG consolidated basis) Cumulative loss Carrying other than acquisition as of Mar 2024 amount * Exchange from of investments as of (SBG consolidated Amount paid
Slide 16: Arm Segment: Bridge to Arm's disclosure (FY23 P/L)
Arm Segment in SBG’s Consolidated Financial Report Bridge to Arm’s disclosure (FY23 P/L) Adjustment (1) Adjustment (2) Adjustment (3) Amortization expenses SBG Consolidated related to intangible Difference in assets recognized in accounting Arm Financial Report Arm segment the purchase price standar
Slide 17: Consolidated P/L Summary
Consolidated P/L Summary (¥ B) P/L item FY22 FY23 Change Net sales 6,570.4 6,756.5 +186.1 Gross profit 3,328.0 3,542.4 +214.4 1 ・¥371.1B investment gain on TMo shares Gain/loss on investments ・¥959.9B realized and unrealized valuation losses on Alibaba shares Investment Business of Holding (offset b
Slide 18: Net Income Attributable to Owners of the Parent for FY23
Calculation from Income Before Income Tax to Net Income Attributable to Owners of the Parent for FY23 (¥ B) 209.2 57.8 -436.9 +580.5 -227.6 -429.1 Income before Current income Deferred tax Net Net income Net income income tax taxes expenses income attributable to attributable to owners non-controlli
Slide 19: Difference in Tax Rate
Difference in Tax Rate (Minuses show expenses) FY23 Rate (％) Amount (¥ B) Income before income tax 57.8 Effective statutory tax rate 31.5％ -18.1 (Main factors of difference) (i) Anti-tax haven taxation in Japan -309.8% 179.1 (ii) Permanent difference 211.3% -122.1 (iii) Recoverability of deferred ta
Slide 20: Loss Carryforwards
Loss Carryforwards (as of Mar 31, 2024) (¥ B) Valuation Carrying amounts Income base Tax base allowance in B/S Total of companies 2,611.6 835.5 -310.1 525.4 based in Japan Total of companies 362.2 84.0 -45.8 38.2 based outside of Japan Consolidated total 2,973.8 919.5 -355.9 563.6 Accounting 17
Slide 21: Income Taxes Paid on a Consolidated Basis (Net)
Income Taxes Paid on a Consolidated Basis (Net) (¥ B) FY18 FY19 FY20 FY21 FY22 FY23 Total Consolidated 415.4 636.3 445.5 589.3 525.9 816.8 3,429.2 Japan 284.3 575.2 310.5 551.2 469.7 717.0 2,907.9 SBG and holding companies (wholly 36.8 324.7 35.7 200.0 214.2 443.3 1,254.7 owned subsidiaries) Ope
Slide 22: Consolidated B/S Summary – Non-current assets
Consolidated B/S Summary – 1 (¥ B) B/S Main items Mar 2023 Mar 2024 Change item 1 SBG and wholly owned subsidiaries conducting fund procurement, etc.: ¥3,024.0B (¥1,061.0B decrease) Current assets 10,586.5 11,441.4 +854.9 Cash and cash equivalents 6,925.2 1 6,186.9 -738.3 2 ・¥644.1B increase for A
Slide 23: Investment Securities in Consolidated B/S
Investment Securities in Consolidated B/S (Main Investments) (¥ B) Mar 2023 Mar 2024 Change Outline Investment securities 7,706.5 9,062.0 +1,355.5 FVTPL 7,244.3 8,321.5 +1,077.2 4,842.3 3,757.1 -1,085.2 Decreased mainly due to lower share price and the physical Alibaba $36,264M $24,814M -$11,450M se
Slide 24: Breakdown of Goodwill/Intangible Assets
Breakdown of Goodwill/Intangible Assets (¥ B) Change B/S Main items Mar 2023 Mar 2024 Amorti- Changes in Outline Item Others zation FX rate 5,199.5 5,709.9 *1 Goodwill Arm 3,161.7 3,585.0 ― +423.3 ― SBKK 913.9 913.9 ― ― ― LY*2 647.4 647.4 ― ― ― ZOZO 214.0 214.0 ― ― ― Technologies 344.3 359.0 Main in
Slide 25: Consolidated B/S Summary – Non-current liabilities
Consolidated B/S Summary – 2 (¥ B) B/S item Main items Mar 2023 Mar 2024 Change 1 SBG 10,580.7 14,020.3 +3,439.6 Borrowings*: ¥463.0B (¥81.1B increase) Interest-bearing debt 5,129.0 1 8,271.1 +3,142.1 Corporate bonds*: ¥6,147.6B (¥394.6B increase) Wholly owned subsidiaries conducting fund procuremen
Slide 26: Consolidated B/S Summary – Equity
Consolidated B/S Summary – 3 (¥ B) B/S Mar Mar Items Change Item 2023 2024 10,649.2 13,237.2 +2,588.0 1 Amount equivalent to the gain on the sale of Arm shares upon Common stock 238.8 238.8 ― its IPO :¥674.4B Capital surplus 2,652.8 3,326.1 1 +673.3 2 Redeemed $2.0B USD-denominated NC6 undated hybri
Slide 27: Impact of the Weaker Yen on P/L & B/S (Illustration)
Impact of the Weaker Yen on P/L & B/S (Illustration) P/L B/S Entities Components Foreign exchange Exchange differences gain (loss) from translation Foreign currency- denominated cash and cash equivalents/ SBG stand-alone + Loans receivable Foreign exchange gain Subsidiaries conducting (excl. investm
Slide 28: Impact of the Weaker Yen in FY23
Impact of the Weaker Yen in FY23 (from ¥133.53/$ to ¥151.41/$) Foreign exchange loss in consolidated P/L for FY23: ¥703.1B At SBG stand-alone: Foreign exchange losses of ¥982.2B related to foreign currency-denominated borrowings from Group companies, ¥74.1B related to foreign currency-denominated bo
Slide 29: Consolidated C/F Summary
Consolidated C/F Summary (¥ B) 1 ¥250.5B net inflow, despite outlays for income taxes and the acquisition of C/F corporate bonds by SB Northstar FY22 FY23 Primary details for FY23 item ・¥885.6B income taxes paid +1,241.7 Subtotal of cash flows from operating activities SBG has paid ¥368.6B income ta
Slide 30: Co-investment Program to SVF2: Related Party Transactions
Co-investment Program to SVF2: Related Party Transactions Equity interests of third-party interests Masayoshi SBG FY23: $― (¥―) Son* 1 FY22: $― (¥―) Equity interests: 17.25% (B) (A) Distribution: $173M Equity acquisition amount: $2,923M 100% (Return of capital) (i) Acquisition costs: $2,594M (commit
Slide 31: Co-investment Program to LatAm Funds & Management's Investment
Co-investment Program to LatAm Funds & Management’s Investment in Asset Management Subsidiary Co-investment program to LatAm Funds Management’s investment in Equity interests of third-party investors asset management subsidiary FY23: $93M ( ¥14.1B) FY22: $215M (¥28.7B) Masayoshi SBG Masayoshi Son SB
Slide 32: Appendix
Appendix
Slide 33: Arm IPO and Accounting Treatment
Arm IPO and Accounting Treatment In September 2023, SBG’s wholly owned subsidiary disposed 10%* of Arm shares in the IPO and received proceeds of $5.12B. The amount equivalent to the gain on the disposal was $4.65B. Arm continues to be SBG’s consolidated subsidiary post-IPO as SBG holds 90%* of
Slide 34: Bridge to Arm's Form F-1 (FY22 P/L)
Arm Segment in SBG’s Consolidated Financial Report Bridge to Arm’s Form F-1 (FY22 P/L) Adjustment (1) Adjustment (2) Adjustment (3) Amortization expenses SBG Consolidated related to intangible Difference in Reflecting the latest assets recognized in accounting available Arm Financial Report Arm segm