Slide 1: Financial Results Briefing for FY2022
Financial Results Briefing for FY2022 Path clears to return to medium and long-term growth trajectory from expansion/entry into new business domains November 15, 2022 71st Investor Meeting Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved.
Slide 2: Agenda
Agenda 1. Summary of Financial Results for FY2022 2. FY2023 Earnings Forecast 3. Growth Strategy and Initiatives in Focus Areas 4. Sustainability 5. Financial Highlights and Reference Materials Following abbreviations are used in this material. GMO-PG：GMO Payment Gateway; GMO-EP：GMO Epsilon; GMO-MR：
Slide 3: Safe Harbor Statement
Safe Harbor Statement The contents of this document are based on generally recognized economic and social conditions, as well as assumptions judged to be reasonable by GMO Payment Gateway as of November 15, 2022. Please note that the contents are subject to change without prior notice in the event o
Slide 4: 1. Summary of Financial Results for FY2022
1. Summary of Financial Results for FY2022 Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 4
Slide 5: Earnings Summary
1.1 Earnings Summary Achieved full year guidance regardless of market changes; special dividends to be paid from investment gains IFRS FY2022 Guidance Q4 FY2022 FY2021 FY2022 % YoY （¥ Mil） (Achievement %) （% YoY） 50,000 13,341 Revenue 41,667 50,298 +20.7% (100.6％) (+19.8％) 8,854 Gross Profit 28,098
Slide 6: A Look Back at FY2022
1.2 A Look Back at FY2022 Overcame changes in business environment thanks to long-term investment and balancing and synergies of/in each business Changes in external conditions Looking Back on the year • Organization levels are not well balanced COVID-19 → Delays in talent development (incl. middle
Slide 7: GMO-PG Non-consolidated Performance: Quarterly Trend
1.3.1 GMO-PG Non-consolidated Performance: (Quarterly Trend) Revenue up 23.6%, large non-merchandise EC and BaaS support drive revenue growth % YoY ※2 ※1 Q4 Q3 Q4 GMO-PG Non-consolidated Revenue and OP FY2021 FY2022 FY2022 （¥ Mil） 7,000 Revenue at a certain merchant (left axis) 4,000 Revenue ＋12.8％
Slide 8: Reasons behind non-merchandise EC growth
1.3.2 Reasons behind non-merchandise EC growth Benefits of sales strategy targeting large merchants are appearing, top-10 non-merchandise EC revenue growth accelerates to 27% GMO-PG Top-10 Non-merchandise EC revenue （¥ Mil） % YoY Q3 FY2022 Q4 FY2022 Merchants that drove the TOP- Q4 FY22 1,000 10 rev
Slide 9: Performance of GMO-EP, GMO-PS and GMO-FG
1.3.3 Performance of GMO-EP, GMO-PS and GMO-FG (Quarterly Trend) ※1 GMO-FG continues strong performance; GMO-PS recovery trend; GMO-EP strengthening partner strategy Revenue (left axis) KPI (right axis) GMO-EP Consol. GMO-PS GMO-FG Consol. Revenue (% YoY) ＋0.7％ Revenue (% YoY) ＋10.5％ Revenue (% YoY)
Slide 10: Waterfall Chart for Consol. TRX Value (Q4 FY2022)
1.4 Waterfall Chart for Consol. TRX Value (Q4 FY2022) Achieved above-market growth rate from increase in offline ※1 and non-merchandiseOnline EC payment Company ＋32.5% Consol. ＋45.4% （¥ tril.） Offline payment Market ＋17.7% （％ YoY） Outperform Non-merchandise EC Merchandise EC Company ＋97.6% +57.1% +8
Slide 11: Revenue by Business Model (Quarterly Trend)
1.5 Revenue by Business Model (Quarterly Trend) Expansion of offline payments driving stock, fee and spread revenues % YoY Q4 FY2021 Q3 FY2022 Q4 FY2022 （¥ Mil） 14,000 13,341 Spread ＋7.2％ +12.5％ ＋14.4％ ＋ Offline payment 12,000 ＋ Early Payment service 11,132 5,415 ＋ Overseas Lending 10,000 ＋ Online p
Slide 12: Segment Results (Quarterly Trend)
1.6 Segment Results (Quarterly Trend) Sluggish segment growth from cycling through of COVID windfall Segment Revenue Consol. ＋19.8％ YoY Segment Profit ＋25.2％ YoY（after consol. adjustments) （¥ Mil） （¥ Mil） 14,000 13,341 225 ＋21.5％ YoY 4,500 3,461 ＋ GMO-MR＋46.1％ 3 Positive profit 12,000 11,132 ＋ GMO-M
Slide 13: 2. FY2023 Earnings Forecast
2. FY2023 Earnings Forecast Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 13
Slide 14: Consolidated Earnings Forecast
2.1 Consolidated Earnings Forecast Guiding for revenue growth 17.5% and OP growth 25% FY2023 Earnings Forecast IFRS （¥ Mil） FY2022 FY2023 % YoY Revenue 50,298 59,100 +17.5% Operating Profit 16,249 20,311 +25.0% Pre-tax Profit 34,756 18,837 －45.8% Adj. for special factors ※ 16,802 +12.1% Profit 24,36
Slide 15: Consol. Revenue Guidance Explained
2.2 Consol. Revenue Guidance Explained Given macro uncertainty, budget based on removing optimism and including only highly-likely initiatives Revenue (Actual, Forecast) and new initiatives ① Growth assumption for existing businesses （¥ Mil） Guidance＋17.5％ ② FY2022 70,000 New Sudden changes in COVID
Slide 16: Outlook of Revenue Growth
2.3 Outlook of Revenue Growth Strong offline payment; non-merchandise EC、BaaS support, overseas MSB returning to 25% growth trend line Revenue growth of major companies GMO-PG Total Non-merch EC, BaaS support, overseas (quarterly trend) GMO-PG Non-merch. EC, etc. MSB, etc. are recovering slowly GMO-
Slide 17: 3. Growth Strategy and Initiatives in Focus Areas
3. Growth Strategy and Initiatives in Focus Areas Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 17
Slide 18: Return to 25% Revenue Growth Trend
3.1 Return to 25% Revenue Growth Trend Aim to return to 25% revenue growth from mid- to long-term initiatives at each company Mid- to long-term revenue growth Business strategy to return to 25％ growth trend Page Actual Guidance Internal target GMO-PG non-consolidated 3.4 Increase nos. of clients (Hi
Slide 19: Sales Strategy for Large Customers (High Value)①
3.2.1 Sales Strategy for Large Customers (High Value)① Buildout applications that resolve issues in respective industries, then deploy within the vertical Revenue expansion image by deploying applications Revenue App 3 Provide applications that support DX of App 2 business operations and resolve the
Slide 20: Sales Strategy for Large Customers (High Value)②
3.2.2 Sales Strategy for Large Customers (High Value)② Multiple offering of DX-supporting applications, including in the payment-related areas such as invoice and remittance Revenue Industry Application Target target 1 2 3 Ⅰ Ⅱ Ⅲ FY2027 Credit card Banks/Non-Banks Ginko Pay Acquiring Credit card issu
Slide 21: GMO-PG's Business Domain and Expanding Partnerships
3.3.1 GMO-PG’s Business Domain and Expanding Partnerships Monetize new payment methods and acquire new entrants GMO-PG’s clients/partners Capture diverse Payment payment methods methods to support Expand QR code payment merchants and corner the market QR code New payment methods Credit card issuing,
Slide 22: GMO-PG's Differentiation
3.3.2 GMO-PG’s Differentiation Business expansion based on proprietary positioning that leverages our unique strengths Peers GMO-PG ・Leverage in-house proprietary application Business Stock SIer model Flow Transaction ・Onboards digital payments required for achieving DX ・Business scale Generic/ ・Leg
Slide 23: Broader EC
3.4 Broader EC Broader EC 2025 OP Target ¥18.0～¥22.0 bn Strengthen merchandise EC recovery, continue focus on non- merchandise EC to achieve 25% revenue growth※1 TRX value of merchandise/non-merchandise Pre-COVID to present: Market and GMO-PG scale EC (quarterly trend) comparison (indexed) （¥ tril）
Slide 24: BaaS (Embedded Finance)
3.5 BaaS BaaS 2025 OP Target （Embedded Finance） ¥1.0 bn～ Sustain growth by strengthening credit card issuing to resolve customer’s issues ※1 Ginko Pay/Processing platform (quarterly trend) Why GMO-PG services are chosen ・Promptly provide new functions and cost minimization ■ Ginko Pay ■ Issuing (Pro
Slide 25: Offline・IoT
3.6 Offline・IoT Offline・IoT 2025 OP Target ¥2.0 bn～ ※1 Realize growth by making inroads to large enterprises using industry-specific services across various industries Quarterly trend of GMO-FG/CAS revenue by Horizontal expansion with industry: ※2 business model (quarterly trend) Reach for large ent
Slide 26: FinTech
3.7 FinTech FinTech 2025 OP Target ¥3.0 bn～ Growth rate improvement driven by overseas business; BNPL remains sluggish but measures to capture customer needs underway FinTech revenue and operating profit Growing BNPL needs unique to Japan （¥ Mil） ・Alternative payment method in a market that still us
Slide 27: Global MSB
3.8.1 Global MSB Global 2025 OP Target ¥3.0 bn～ High demand for credit on the back of 5% GDP growth; enjoying 12% yields ※ Support Credit Providers, a requisite of EC market in MSB plan (loan balance, number of borrowers) all Asian countries 90 360 Loan balance • Increase lending to high-performance
Slide 28: Global: Earnings Summary
3.8.2 Global: Earnings Summary Asia MSB revenue up approx. 60%; full year OP up 2.5x New borrowers in FY2022 Revenue & OP (Q4 cumu.) ※ Loan balance (end-Sep) (Overview of FinTech companies) （¥ Mil） （¥ Mil） % YoY Global MSB ＋26.7% 1,000 ＋51.7% P2P PF operator for SMEs USA MSB 10,000 ROI 7.09% per ann
Slide 29: 4. Sustainability
4. Sustainability Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 29
Slide 30: Sustainability
4.1 Sustainability Promoting Sustainability Management from this Fiscal year and Contributing to SDGs Commenced payment processing using de facto renewable energy E • • Established a zero-emission target • Support customer’s transition to paperless by digitalizing invoices (electricity bills, BNPL)
Slide 31: Paperless initiatives at GMO-PS
4.2 Paperless initiatives at GMO-PS Supporting SDG initiatives by eliminating paper invoices and introducing paperless processes Background • Heightened need to eliminate paper invoices GMO Payment After Delivery in order to realize SDGs and further improve Expanding Bar Code Payment usability of BN
Slide 32: 5. Financial Highlights and Reference Materials
5. Financial Highlights and Reference Materials Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 32
Slide 33: Consolidated Balance Sheet Changes
5.1.1 Consolidated Balance Sheet Changes Divestments strengthened investment funds and capital base Asset Liabilities/Equity （¥ Mil） （¥ Mil） 273,407 273,407 250,000 250,000 215,455 215,455 85,562 192,022 113,967 192,022 200,000 200,000 Deposits to 78,251 35,252 104,523 subsidiaries 150,000 and affil
Slide 34: Major Consolidated Financial Indicators (Annual trend)
5.1.2 Major Consolidated Financial Indicators (Annual trend) Strengthened equity base with the expansion of MSB J-GAAP IFRS Third party allotment 45% 300 Raised ¥8.0bn Euro Yen CB Due2026 千 （十億円） Raised ¥21.1 bn 40% Euro Yen CB Due 2023 Issued Euro Yen Fully converted 250 35% CB Due 2023 33.8% Raise
Slide 35: Consolidated Revenue Waterfall Chart (Q4)
5.2.1 Consolidated Revenue Waterfall Chart (Q4) Consol. revenue grew 19.8% from the increase in offline and non-merchandise payments （¥100 Mil） GMO-FG GMO-PG GMO-PS GMO-EP ¥13.3bn 億 130 SME Other BNPL domain MSB BaaS Merchandise Support 120 EC Non- ¥11.1bn merchandise 110 EC Offline payment 100 90 0
Slide 36: Consolidated OP and Pre-tax Profit Waterfall Chart
5.2.2 Consolidated OP and Pre-tax Profit Waterfall Chart (Q4 Cumu.) Pre-tax profit grew 161.6% from gain on sale related to overseas investment activities , etc. OP YoY: waterfall chart Pre-tax profit YoY: waterfall chart （+25.1% YoY） （¥ Mil） （+161.6% YoY） （¥ Mil） SGA Gain on sales GP increase Other
Slide 37: Consolidated Revenue by Business Model (Q4 Cumulative)
5.3.1 Consolidated Revenue by Business Model (Q4 Cumulative) Solid stock revenue from expansion of processing platform （¥ Mil） Spread ＋13.1％ 50,298 ＋ Offline payment 50,000 ＋ Overseas lending ＋ Early Payment service 41,667 － Online payment 21,381 40,000 － GMO Payment After Delivery 18,913 Fee ＋25.8％
Slide 38: Consolidated Quarterly Trend of Revenue by Business Model
5.3.2 Consolidated Quarterly Trend of Revenue by Business Model （¥ Mil） 5,500 5,371 5,415 5,296 5,297 5,000 4,808 4,707 4,731 4,665 4,500 4,290 4,414 4,000 3,840 3,646 3,672 3,450 3,500 3,364 3,395 3,289 3,278 3,135 3,149 2,922 3,000 2,815 2,671 2,713 2,669 2,037 2,557 2,532 2,527 2,559 2,080 2,500
Slide 39: Consolidated Revenue Trend by Business Model (Annual)
5.3.3 Consolidated Revenue Trend by Business Model (Annual) （¥ Mil） 60,000 J-GAAP IFRS 55,000 50,000 Spread 45,000 40,000 35,000 30,000 25,000 Fee 20,000 15,000 Stock 10,000 5,000 Initial 0 04/9 05/9 06/9 07/9 08/9 09/9 10/9 11/9 12/9 13/9 14/9 15/9 16/9 17/9 18/9 19/9 20/9 21/9 22/9 23/9E TSE Listi
Slide 40: Segment Results (Consolidated, Q4 Cumulative)
5.4 Segment Results (Consolidated, Q4 Cumulative) Low segment growth rates dues to cycling through of COVID windfall demand ＋25.1％ YoY Segment Revenue ＋20.7％ YoY（Consol.） Segment Profit （after consol. adjustments) （¥ Mil） （¥ Mil） 50,298 16,249 50,000 942 ＋31.3％ YoY 20,000 174 Positive profit ＋ GMO-M
Slide 41: FinTech: Assets & Profit Growth (Q4 FY2022)
5.5.1 FinTech: Assets & Profit Growth (Q4 FY2022) Steady profit trend from expansion of high margin services MSB related assets (end-Sep.) Segment revenue Segment profit （% YoY) （¥ Mil） （¥ Mil） （¥ Mil） +23.4％ ＋35.2％ 3,000 ＋15.2％ +17.3％ ＋0.4％ 80,000 400 +13.4％ 2,500 ＋23.6％ 60,000 2,000 1,500 40,000 +
Slide 42: FinTech: Assets & Profit Growth (Q4 Cumulative)
5.5.2 FinTech: Assets & Profit Growth (Q4 Cumulative) Steady profit trend from expansion of high margin services MSB related assets (end-Sep.) Segment revenue Segment profit （% YoY) （¥ Mil) （¥ Mil) （¥ Mil) +23.4％ ＋12.3％ －25.9％ +17.8％ ＋35.2％ 2,400 80,000 10,000 +10.0％ 2,000 ＋23.6％ 60,000 8,000 1,600
Slide 43: Consolidated Quarterly Trend of CoS and SG&A Ratio
5.6.1 Consolidated Quarterly Trend of CoS and SG&A Ratio CoS ratio fluctuates with changes in revenue mix ※ (¥ Mil) 13,341 12,897 12,201 50.0% 11,857 12,000 42.7% 11,132 41.2% 36.8% 10,646 40.9% 10,121 10,000 37.6% 9,356 9,767 36.6% 8,623 37.5% 40.0% 35.9% 35.5% 9,030 36.7% 34.7% 8,927 34.8% 34.6% 3
Slide 44: CoS/SGA Ratio of GMO-PG & GMO-EP
5.6.2 CoS/SGA Ratio of GMO-PG & GMO-EP (Quarterly Trend) Cost of sales ratio for online payment business trending stably (¥ Mil) 8,498 7,977 8,000 7,906 50.0% 7,682 44.8% 7,122 6,858 6,878 7,000 6,370 6,709 41.2% 39.7% 40.7% 36.5% 45.2% 40.0% 36.8% 6,110 41.6% 6,000 33.1% 5,271 5,126 5,032 5,142 4,8
Slide 45: Operating Stores, TRX Volume and Value (Quarterly Trend)
5.7.1 Operating Stores, TRX Volume and Value (Quarterly Trend) Group-wide annual TRX value reaches approx. ¥11.3 trillion ※1 Operating stores 142,396 stores, consol. TRX volume approx. 1.33 bn, consol. TRX value approx. ¥3.0 trillion※2 （100 mil （¥ Tri） （Stores） (Reference 1) Online payment TRX volum
Slide 46: Consolidated TRX Volume and Value (Quarterly Trend)
5.7.2 Consolidated TRX Volume and Value (Quarterly Trend) TRX volume and value continues its robust growth; both offline and online trended strongly Consol. TRX Volume ＋36.6％ YoY Consol. TRX Value ＋45.4％ YoY （Mil transactions) （¥ bn) 1,400 Online payment 3,000 Offline payment 1,200 2,500 1,000 2,000
Slide 47: Scatter Chart of Major Merchant Sectors
5.7.3 Scatter Chart of Major Merchant Sectors (Q4 standalone) Sector diversification achieves both stability and growth ■Revenue proportion by sector (vertical axis)/Revenue growth rate (horizontal axis) 30% （Based on Q4 FY2022） Size of circle denotes the size of TRX value 25% Digital content・ Telec
Slide 48: Consolidated Cashflow Statement
5.8.1 Consolidated Cashflow Statement FY2022 changes by item (¥ Mil) （¥ Mil） Operating CF: ＋7,656 J-GAAP IFRS 55,000 Pretax profit +34,756 50,000 Gain on sale of equity method affiliate −16,932 45,000 Advances paid −9,101 40,000 Accrued revenue －6,018 35,000 Accrued expense ＋2,402 30,000 Deposits re
Slide 49: Changes in the Consolidated CF Statement
5.8.2 Changes in the Consolidated CF Statement Following factors affect operating CF other than the pretax profit Related Liabilities & Assets Impact from business expansion Payment Processing Business Sales proceeds from Deposits received Liability Operating CF merchants under (liability) Yearly fl
Slide 50: Thank You Very Much
あThank り が とYou う ごVery ざ い Much ました GMOペイメントゲートウェイ株式会社 GMO Payment Gateway, Inc. (3769; ( 東 証Tokyo プラ Stock イム Exchange 376 Prime) 9) IRサイトURL https://www.gmo-pg.com/corp/ URL： https://www.gmo-pg.com/en/corp/ お問合せ・個別取材のお申込みは、企業価値創造戦略 統括本部 For inquiries, please contact our IR team at the telephoneIR