Softbank Group Corp. · TSE:9984
Softbank — Q3 FY2020 Earnings Presentation
116 slides from Softbank's earnings presentation, Feb 10, 2021
Slide 1: Earnings Results for the Nine-month Period Ended December 31, 2020
Ver.1.4 Earnings Results for the Nine-month Period Ended December 31, 2020 Investor Briefing February 10, 2021 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 used for translation; Abbreviations
Exchange rates used for translation FY2019 FY2020 Average during quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1 USD 110.00 107.70 108.98 109.22 107.74 105.88 104.45 1 CNY 16.13 15.37 15.46 15.56 15.16 15.27 15.71 EOQ Jun 30 Sep 30 Dec 31 Mar 31 Jun 30 Sep 30 Dec 31 Mar 31 1 USD 108.83 103.50 1 CNY 15.31 15.88 Ab
Slide 4: Index
Index Accounting Finance Consolidated Results P 2 Summary of FY2020 Q3 P 2 SBG Standalone Interest-bearing Debt P 26 Change in Reportable Segments P 3 Increase in Gain on Investments P 4 SBG Standalone Cash Position P 27 Entry into Agreement for Sale of P 4 Main Investment Activities of SVF1 and P 5
Slide 5: Accounting
Accounting
Slide 6: Consolidated Results
Consolidated Results FY19 FY20 (JPY bn) Q1-Q3 Q1-Q3 Change YoY Net sales 3,901.3 4,138.0 236.7 6.1% Income before 1,442.7 3,361.5 1,918.8 133.0% income tax Net income (attributable to owners of 476.6 3,055.2 2,578.6 541.0% the parent) (Reference) Gain on investments 131.8 3,799.5 3,667.7 - Investmen
Slide 7: Change in Reportable Segments
Change in Reportable Segments • In Q1, “Investment Business of Holding Companies” was newly established. Segment income was revised to “income before income tax.” • In Q2, “Brightstar segment” was removed. “SoftBank Vision Fund and Other SBIA-Managed Funds” was renamed to “SVF1 and Other SBIA-Manage
Slide 8: Entry into Agreement for Sale of All Shares in Arm – Overview
Entry into Agreement for Sale of All Shares in Arm – Overview • In Sep 2020, the Company agreed to sell all of Arm shares to NVIDIA. • As the Company expects to receive approx. 6.7- 8.1% of NVIDIA shares, further upside can be enjoyed as the largest shareholder when the share price goes higher. (USD
Slide 9: Entry into Agreement for Sale of All Shares in Arm – Accounting
Entry into Agreement for Sale of All Shares in Arm – Accounting • Arm will continue to be classified under continuing FY20 FY21 FY22 operations (until the closing of the transaction is deemed Sep 13 (execution of Closing Purchase Agreement) Approx.18 months highly probable, such as obtaining regulat
Slide 10: Derivative gain (loss) on Alibaba Prepaid Forward Contracts
Derivative gain (loss) on Alibaba Prepaid Forward Contracts Q2-end: $293.98 Alibaba share price Amendment Q3-end: of contracts $232.73 Q1-end: $215.7 (JPY bn) (JPY bn) FY20Q3 YTD Income before -485.4 Signing income tax (-$4.5B) Net income -705.5 (-$6.6B) 280.9 Derivative gain 184.4 ($2.7B) ($1.7B) -
Slide 11: Segment Income - Investment Business of Holding Companies
Segment Income - Investment Business of Holding Companies (JPY bn) P/L FY19 FY20 Items Q1-Q3 Q1-Q3 Gain on investments 840.7 846.5 (1) Gain of 280.3 bn on sales of T-Mobile shares (2) Gain of 296.0 bn on the revaluation of T-Mobile shares continued to be held by the Company (3) Derivative loss of 15
Slide 12: Investment Business of Holding Companies Segment
Investment Business of Holding Companies Segment • Main businesses: Investment activities by SBG and its subsidiaries • Core companies: SBG, SBGC, SBGJ and SB Northstar SBG By contract, two-thirds of gain/loss is attributable to SBG and the remaining one-third to non-controlling interests (Masayoshi
Slide 13: Investment in Listed Stocks and Other Instruments
Investment in Listed Stocks and Other Instruments • In order to diversify assets and manage surplus funds, investments were initially made by SBG directly and later by asset management subsidiary SB Northstar from Q2. • SB Northstar is engaged in acquiring and selling listed stocks and derivative an
Slide 14: Investment in Listed Stocks and Other Instruments: Main Impact on B/S and P/L
Investment in Listed Stocks and Other Instruments: Main Impact on B/S and P/L (Gain (Loss) on Investments) (JPY bn) Consolidated B/S Consolidated P/L Investor Investment type FY20Q3-end Gain (loss) recorded Account balance Account (minuses indicate FY20 liabilities) Q1 Q2 Q3 Q1-Q3 Realized gain on s
Slide 15: Investment in Listed Stocks by SB Northstar: Gain/Loss Transferred from SBG
Investment in Listed Stocks by SB Northstar: Gain/Loss on Investments Transferred from SBG in P/L In case that SB Northstar continues Fair value held to hold listed shares after the shares at SB Northstar are transferred from SBG Transfer value P/L accounts to SB Northstar Valuation gain at SB North
Slide 16: Impact of the Asset Management Subsidiaries on SBG Consolidated B/S
Impact of the Asset Management Subsidiaries on SBG Consolidated B/S*1 (JPY bn) December 31, December 31, 2020 2020 Cash and cash equivalents 284.9 Interest-bearing debt 1,528.8 Investments from asset management subsidiaries 1,039.9 Derivative financial liabilities in asset management subsidiaries 64
Slide 17: Price Sensitivity of Derivatives at SB Northstar
Price Sensitivity of Derivatives at SB Northstar (FY20Q3-end) The below table shows the impact on income before income tax of changes in the market prices of the underlying assets for long and short call options of listed stocks, short stock index futures contracts, and total return swap contracts o
Slide 18: Consolidated P/L Summary (IFRSs)
Consolidated P/L Summary (IFRSs) FY19 FY20 (JPY bn) P/L item Change Q1-Q3 Q1-Q3 Gain on investments at Investment Business of Holding Companies: +846.5 bn Continuing operations (see page 7, 10, 24 for details) Net sales 3,901.3 4,138.0 +236.7 ・Gain relating to sales of T-Mobile shares: 421.8 bn ・Unr
Slide 19: Consolidated B/S Summary (IFRSs) - Non-current assets
Consolidated B/S Summary (IFRSs) - 1 (JPY bn) B/S As of As of Main items Change Increased mainly due to the sale and monetization of assets under the JPY 4.5 trillion program item Mar 2020 Dec 2020 15,636.9 10,066.9 -5,570.0 1 Current assets related to investments from SB Northstar Cash and cash equ
Slide 20: Consolidated B/S Summary (IFRSs) - Non-current liabilities
Consolidated B/S Summary (IFRSs) - 2 B/S As of As of (JPY bn) Main items Change item Mar 2020 Dec 2020 1 Current Interest-bearing debt of SB Northstar 14,191.1 9,810.7 -4,380.5 ・Short-term borrowings to be used in transactions for listed stocks: +910.0 bn 1 ・Borrowings made using Alibaba shares (mar
Slide 21: Consolidated B/S Summary (IFRSs) - Equity
Consolidated B/S Summary (IFRSs) - 3 (JPY bn) B/S As of As of Items Change item Mar 2020 Dec 2020 7,372.9 8,622.3 +1,249.4 Changes in interests in subsidiaries resulting from the partial sale of SBKK shares: +932.4 bn Common stock 238.8 238.8 - 1 Capital surplus 1,490.3 2,401.8 +911.5 Net income att
Slide 22: Consolidated C/F Summary (IFRSs)
Consolidated C/F Summary (IFRSs) (JPY bn) C/F from operating activities: -73.0 bn (-696.7 bn yoy) FY19Q1-Q3: Includes Sprint’s cash flow of 431.4 bn FY19 FY20 C/F item Primary details for FY20Q1-Q3 (deconsolidated at the beginning of FY20) Q1-Q3 Q1-Q3 FY20Q1-Q3: SB Northstar -885.6 bn (before elimin
Slide 23: Segment Income - SVF1 and Other SBIA-Managed Funds
Segment Income - SVF1 and Other SBIA-Managed Funds (JPY bn) FY19 FY20 P/L Q1-Q3 Q1-Q3 Items Gain on investments at SVF1 and SVF2 -729.0 2,767.3 SVF1 Realized gain on sales of investments 14.6 205.3 Sale of a portion of shares in 4 portfolio companies and all shares in 7 portfolio companies (includin
Slide 24: Appendix
Appendix
Slide 25: Breakdown of Goodwill / Intangible Assets
Breakdown of Goodwill / Intangible Assets (JPY bn) Change B/S As of As of Main items Changes in Outline item Mar 2020 Dec 2020 Amortization exchange Others rate 3,998.2 3,875.9 *1 Goodwill Arm 2,554.1 2,461.3 - -92.8 - SBKK 907.5 907.5 - - - ZOZO 212.9 212.9 - - - Technologies 395.6 353.4 Main b/d A
Slide 26: Changes in Presentation of P/L
Changes in Presentation of P/L In FY20Q1, “Gain (loss) on investments” is newly P/L after the revision of the presentation presented Operating income is no longer used Net sales Gross profit • The importance of investment activities has increased in the consolidated results, following the comple
Slide 27: Accounting Treatment for Partial Sale of SBKK Shares and After-tax Cash Proceeds
Accounting Treatment for Partial Sale of SBKK Shares and After-tax Cash Proceeds • In May and Sep 2020, SBG sold a total of 1.27 bn shares of SBKK held through SBGJ (SoftBank Group Japan Corp.) and received a total of JPY 1.5 tn. May: 240 mil shares (shareholding ratio: 5.0%) sold for JPY 310.2 bn
Slide 28: Partial Sale of T-Mobile Shares and Evaluation at Q3-end
Partial Sale of T-Mobile Shares and Evaluation at Q3-end The Company sold (1) and (2) below in FY20Q1 and received JPY 1,830.4 bn. With additional sales of (3) and (4) in Q2, the Company received JPY 2,099.7 bn in aggregate for FY20Q1-Q2. P/L (FY20Q1-Q3) (JPY bn) Evaluation at Q3-end Gain relating t
Slide 29: Finance
Finance SBG standalone financial numbers are calculated by excluding numbers of self-financing entities from the consolidated numbers, unless otherwise stated. Major self-financing entities are SBKK, Arm, SVF1, SVF2, Brightstar, PayPay, Fortress, SB Energy, etc.
Slide 30: Summary of FY2020 Q3
Summary of FY2020 Q3*1 Investment businesses performed robustly, especially at SVF. Diversifying assets portfolio while being firmly committed to our financial policies. Robust Gain on investments totaled ¥3.8T, mainly for SVF investment - Listings of DoorDash and Opendoor (in Q3) businesses - Net
Slide 31: Finance agenda
- Robust Investment Businesses - Status of Assets - Progress of ¥4.5T Program - Financial Condition - Financial Strategy - ESG Initiatives Finance 3
Slide 32: Increase in Gain on Investments
Increase in Gain on Investments Net income of ¥3.1T: Gain on investments at SVF1 & SVF2 increased significantly. Gain on investments Net income (attributable to owners of the parent) Investment Business SVF1 and SVF2 Other Total gain on of Holding Companies investments investments (¥ T) (¥ T) 4.5 4.
Slide 33: Main Investment Activities of SVF1 and SVF2 (since Oct 2020)
Main Investment Activities of SVF1 and SVF2 (since Oct 2020) Successful public listing of DoorDash, Opendoor, and Seer. Listing of a SBIA-sponsored SPAC (special purpose acquisition company). New listings Exited investments New investments SVF1 SVF1 SVF2 IPO Partially exited (December 9, 2020) NASDA
Slide 34: SBG Share Price and Credit Spread
SBG Share Price and Credit Spread Both share price and domestic bond yields stayed firm. SBG share price*1 SBG domestic senior bond yield*2 (YTD) As of Feb 5, 2021 (YTD) (%) 200 191 (SBG) 5.0 175 4.0 150 154 (Nasdaq) 3.0 125 110 (TOPIX) 2.0 100 109 (Dow) 1.0 75 ¥4.5T Program announced ¥4.5T Program
Slide 35: Finance agenda
- Robust Investment Businesses - Status of Assets - Progress of ¥4.5T Program - Financial Condition - Financial Strategy - ESG Initiatives Finance 7
Slide 36: Equity Value of Holdings
Equity Value of Holdings Excluding asset-backed Equity value of holdings marked at ¥26.9T, finance maintaining a high level. Composition (¥ T) 30.9 49％ Alibaba SBKK 26.3 26.9 7％ 13％ SVF1 4％ SVF2 24.3 6％ T-Mobile (formerly Sprint) 9％ Arm 18.6 8％ Investments in listed stocks 13.1 13.0 4％ Others 12.6 *
Slide 37: Alibaba Share Price Trend
Alibaba Share Price Trend Alibaba’s share price (listing to date) As of Feb 5, 2021 $265.7 Annual Growth Rate*1of 24% Alibaba’s stock price has risen at an annual rate of 24% since its listing, despite recent fluctuations. $68.0 Sep'14 Sep'15 Sep'16 Sep'17 Sep'18 Sep'19 Sep'20 *1 Calculated with the
Slide 38: SVF1 & SVF2: Cumulative Investment Performance
SVF1 & SVF2: Cumulative Investment Performance (SBG Consolidated Basis) Significant growth in asset values driven mainly by a greater demand for online services under COVID-19 and IPOs of portfolio companies. SVF1 SVF2 ($B) ($B) 120 104.9 B 10 9.3 B 100 84.5 B Exited*1 1.8x 8 80 Currently held 2.6x
Slide 39: SVF1 & SVF2: Gain (Loss) on Investments
SVF1 & SVF2: Gain (Loss) on Investments (SBG Consolidated Basis)*1 Recorded ¥1.4T gain on investments for FY20Q3. (¥ T) 1.4 T (sum of SVF1 and SVF2) 1.1 0.5 0.4 0.3 0.4 0.3 -0.9 -0.2 -1.1 FY18 FY18 FY18 FY19 FY19 FY19 FY19 FY20 FY20 FY20 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 *1 SVF1 and Other SBIA-Managed F
Slide 40: Strength of SBG's Investment Portfolio
Strength of SBG’s Investment Portfolio Diversified portfolio comprising leading tech companies with high liquidity Proportion of listed companies Arm Semicon (excluding asset-backed finance) Amazon Alphabet Facebook *2 Salesforce PayPal Microsoft SBKK Telecom 70% Investment T-Mobile Telecom in liste
Slide 41: Strength of SBG's Investment Portfolio: Further Diversifying Assets
Strength of SBG’s Investment Portfolio Excluding asset-backed Further diversifying assets as Alibaba's proportion declined finance September 30, 2020 December 31, 2020 T-Mobile 3% T-Mobile 4% SBKK 4% Alibaba SBKK 6% Alibaba 6% Arm 7% 8% 60% Arm 49% 9% Investment in listed stocks 7% Investment in 12%
Slide 42: Investments in Listed Stocks: Investment Gain (Loss) for FY20 Q1-3
Investments in Listed Stocks and Other Instruments: Investment Gain (Loss) for FY20 Q1-3 Valuation gain (loss) + Realized gain (loss) ¥263.0B ¥13.2B Valuation gain ¥55.0B Realized gain ¥207.9B ¥188.1B -¥113.3B -¥577.6B -¥301.4B Actual stocks Actual stocks + Derivatives Total investment Investment lo
Slide 43: Investments in Listed Stocks: Actual Stocks
Investments in Listed Stocks and Other Instruments: Actual Stocks（as of December 31, 2020) ($ M) Fair value AbCellera Biologics 272 Adobe 10 Alphabet Class C 1,375 Amazon.com 7,386 Facebook 3,279 Microsoft 1,105 Netflix 582 Pacific Biosciences of California 238 PayPal Holdings 1,438 salesforce.com 6
Slide 44: Investments in Listed Stocks: Options
Investments in Listed Stocks and Other Instruments: Options (as of December 31, 2020) $13.8B (net) $44.32B $1.4B (net) Long call option of listed stocks $1.68B -$0.24B Short call option of listed stocks -$30.55B Fair value Notional principal Finance 16
Slide 45: Finance agenda
- Robust Investment Businesses - Status of Assets - Progress of ¥4.5T Program - Financial Condition - Financial Strategy - ESG Initiatives Finance 17
Slide 46: ¥4.5T Program
¥4.5T Program Large-scale returns to shareholders and creditors by asset monetization Asset sale and monetization up to ¥4.5T Returns to Financial Shareholders Improvements Share repurchases Debt repayment up to ¥2T Bond buyback (¥2.5T in total with the amount Cash reserves announced on March 13, 20
Slide 47: Asset Monetization (¥4.5T Program)
Asset Monetization (¥4.5T Program) ¥4.5T asset monetization completed by September 2020; monetized ¥5.6T in just 6 months Prepaid forward Alibaba April to August contracts, etc. $15.4B $15.4B May Block trade *1 ¥0.3T SBKK September Offering *1 ¥1.2T $14.4B June to July Public offering, etc. $18.1B T
Slide 48: Debt Reduction
Debt Reduction To be implemented according to market conditions Corporate bonds and borrowings Repurchase of domestic bonds (July) *1 Total amount repurchased ¥167.6B (total face value) Early repayment of senior loan (September) Total amount repaid ¥300.0B Alibaba margin loan*2 Repayment by a wholly
Slide 49: Returns to Shareholders (Share Repurchases)
Returns to Shareholders (Share Repurchases) Reflecting NAV per share*1, SBG share price outperformed others. Share price performance Share repurchases of Japanese large-cap companies (March 19, 2020*3 ~ February 5, 2021) (Market cap, ¥ T) Authorized amount ¥2.5T #1 Toyota (25.8) (of which under ¥4.5
Slide 50: LTV Trend
LTV Trend Excluding asset-backed LTV trend*1 finance 25% • Rapid and large-scale monetization, taking full advantage of highly liquid 18.4% 17.9% assets 18.0% *2 • Agile financial management in 14.9% response to market 11.8% 9.0% conditions as articulated in the financial policy Moneti- Moneti- Prog
Slide 51: Finance agenda
- Robust Investment Businesses - Status of Assets - Progress of ¥4.5T Program - Financial Condition - Financial Strategy - ESG Initiatives Finance 23
Slide 52: LTV
LTV Excluding asset-backed finance 17.9% 14.9% Secured an even larger financial cushion with the progress of ¥4.5T program FY19Q4 FY20Q3 (Mar' 20) (Dec' 20) * Presented LTV ratios are as of the end of each quarter. * See "LTV Calculation: SBG Standalone Net Debt" and "LTV Calculation: SBG Standalone
Slide 53: Cash Position
Cash Position Always maintain ample cash position, more than sufficient for the bond redemptions for the next 2 years Cash position Bond redemption schedule *3 ¥2.0T *1, 2 （¥ B) Bond redemptions for the next 2 years (¥1.7T) ＞ 817.2 872.4 484.3 884.2 Dec' 20 Jan' 21 - Dec' 21 Jan' 22 - Dec' 22 Jan' 2
Slide 54: SBG Standalone Interest-bearing Debt
SBG Standalone Interest-bearing Debt*1 SBG standalone interest-bearing debt Main variance factors from September-end 2020 (excluding non-recourse debt) remains flat. Alibaba margin loan by SB Northstar (+¥618.8 B) Short-term borrowings by SB Northstar (+545.7B) Increase in financial liabilities rela
Slide 55: SBG Standalone Cash Position
SBG Standalone Cash Position Maintain ample cash despite continued shareholder returns and investments (¥ B) 4,601.6 3,437.5 2,175.0 SB Northstar (Cash and deposits and trading securities) 1,389.3 Cash position decreased significantly due to increase in securities pledged as collateral*2. Main varia
Slide 56: SBG Standalone Net Interest-bearing Debt
SBG Standalone Net Interest-bearing Debt*1 Increased through returns to shareholders based on Excluding SB Northstar ¥4.5T program and investments (¥ B) 7,641.9 6,463.0 6,528.9 6,240.1 Adjustments relating to finance 5,645.5 3,624.4 Asset-backed finance ( -¥3,599.1B) 1,426.4 Hybrid finance ( -¥25.2B
Slide 57: Issuance of Hybrid Bonds for Domestic Institutional Investors
Issuance of Hybrid Bonds for Domestic Institutional Investors SBG’s largest-ever issuance to domestic institutional investors. Considering hybrid bonds for retail investors in the future. Hybrid bonds for domestic institutional investors Bond redemption schedule 2016 2021 Issuance (¥ B) Domestic str
Slide 58: Bond Redemption Schedule
Bond Redemption Schedule Exploring various redemption options with refinancings as a main option (¥ B) Domestic straight bonds Amount procured in domestic Domestic subordinated bonds 177.0 hybrid bonds issued in Feb 2021 1,101.1 Domestic hybrid bonds 1,044.6 177.0 Foreign currency-denominated senior
Slide 59: Finance agenda
- Robust Investment Businesses - Status of Assets - Progress of ¥4.5T Program - Financial Condition - Financial Strategy - ESG Initiatives Finance 31
Slide 60: Financial Strategy for FY2020
Financial Strategy for FY2020 Flexible financial management adapting to any change Agile financial Firmly keeping management in financial policy response to market conditions Finance 32
Slide 61: Firmly Keeping Financial Policy (1/2)
Firmly Keeping Financial Policy (1/2) 1. Manage LTV below 25% in normal times (upper threshold of 35% even in times of emergency) 2. Maintain cash position covering bond redemptions for at least the next 2 years 3. Secure sustainable distribution and dividend income from SVF and other subsidiaries F
Slide 62: Firmly Keeping Financial Policy (2/2): Policy on Supporting Portfolio Companies
Firmly Keeping Financial Policy (2/2): Our Policy on Supporting Portfolio Companies Portfolio company finances to be No rescue self-financing package Finance 34
Slide 63: Agile Financial Management in Response to Market Conditions
Agile Financial Management in Response to the Market Conditions Achieving both shareholder return and financial improvement by implementing ¥4.5T Program Appropriately control the balance between new investments and exits (prepare for future investment opportunities) Financial management focused on
Slide 64: Finance agenda
- Robust Investment Businesses - Status of Assets - Progress of ¥4.5T Program - Financial Condition - Financial Strategy - ESG Initiatives Finance 36
Slide 65: SBG's Approach to ESG
SBG’s Approach to ESG (From Earnings Investor Briefing for FY20Q2) Continue essential initiatives for ESG • Take the initiative in addressing changing social issues and lead to trends in society • Continue to discuss what we should address and put them into practice Further strengthen the communicat
Slide 66: E: Responses to Climate Change
E: Environmental Initiatives Responses to Climate Change • Contributing to lay groundwork to disseminate renewable energy in Japan and abroad since 2011 • Actively promoting the reduction of greenhouse gas emissions FY20 Initiatives of Major Group Companies Arm Yahoo Japan SB Energy Declared Committ
Slide 67: S: Social Initiatives – Responses to COVID-19
S: Social Initiatives – Responses to COVID-19 – SBG Established SB Coronavirus Inspection Center Corp. (July 2020) • High quality saliva PCR test offered at no profit (¥2,000 per test) • Pioneering the establishment of private PCR testing centers to supplement tight public testing • Started providin
Slide 68: S: Social Initiatives - Information Security
S: Social Initiatives - Information Security - SBG • Taking a strong response to cyber threats surrounding the Group by utilizing advanced technologies; make information security a source of competitiveness • Through the Information Revolution, contribute to the safe and sound growth of the digital
Slide 69: S: Social Initiatives - Information Security - Zero Trust
S: Social Initiatives - Information Security - SBG “Zero Trust” overcomes the problems and risks of conventional perimeter network security model, and realizes the location and network free security Perimeter Network Security “Zero Trust” Intrusion Outside Attack/Risk Trust Check Engine Always prote
Slide 70: G: Enhancement on Governance
G: Enhancement on Governance - 1 SBG The Board of Directors resolved to strengthen the functions of the Nominating & Compensation Committee in January 2021. Before revision After revision As an advisory body to the Board of As an advisory body to the Board of Directors, deliberate and make Directors
Slide 71: G: Portfolio Company Governance and Investment Guidelines Policy
G: Enhancement on Governance - 2 SBG Portfolio Company Governance and Investment Guidelines Policy • January 2020: Adopted the Policy Recommended governance standards that SBG and Group companies are expected to seek when making new or additional investments in portfolio companies • January 2021:
Slide 72: Expansion of Information Disclosure
Expansion of Information Disclosure SBG SBKK Actively expanding information disclosure on our efforts to date • Expanding disclosure from CSR-centric information to one in line with international ESG standards • Published on website, sustainability report, etc. FY20 Key External Assessment Results 【
Slide 73: Appendix
Appendix
Slide 74: Direction of Financial Management (illustrative)
Direction of Financial Management (illustrative) • Conservative financial management with asset monetization in the COVID-19 market environment • Securing financial stability and preparing for future investment opportunities Value increases in the mid-term; Improving LTV Enables balancing elevated l
Slide 75: SBG Credit Rating Trend
SBG Credit Rating Trend Aim to improve credit rating under the investment holding company rating criteria Acquisition of Acquisition of Acquisition Acquisition Listing Japan Telecom Vodafone KK of Sprint of Arm of SBKK A+ 14 A 13 A- 12 JCR (A－) Outlook Stable BBB+11 BBB 10 BBB- 9 BB+ 8 S&P (BB＋) Out
Slide 76: LTV Calculation: SBG Standalone Net Debt
LTV Calculation: SBG Standalone Net Debt (L) Adjusted SBG standalone net debt*1 ¥4.02T (V) SBG standalone = 14.9% ¥26.91T equity value of holdings = - - Adjusted SBG Consolidated Net debt at self- Other adjustments standalone net debt net debt financing entities (¥ T) 4.02 12.39 4.74 3.62 SoftBank s
Slide 77: LTV Calculation: SBG Standalone Equity Value of Holdings
LTV Calculation: SBG Standalone Equity Value of Holdings (L) Adjusted ¥4.02T SBG Standalone Net Debt (V) SBG Standalone = 14.9% Equity Value of Holdings ¥26.91T SBG standalone Interest of SBG in Other, investments in holdings = Major shares + SVF1/SVF2 + listed stocks, etc. (¥ T) 26.91 19.22 4.56 3.
Slide 78: SVF1: Capital Commitment
SVF1: Capital Commitment (as of December 31, 2020) ($ B) 98.6 (84.5) SBG 33.1*1 （28.9） 65.5 （55.6） Third-party limited partners * Numbers in brackets represent amounts contributed. * The presented SBG’s committed capital to SVF1 includes approximately $8.2 billion of an obligation satisfied by using
Slide 79: SVF1 Snapshot
SVF1 Snapshot (as of December 31, 2020) 1. Gross Return to SVF1 is the sum of the cumulative Gross Realized Proceeds from exited and partially exited investments and Fair Market Value of unrealized investments held by SVF1 as of December 31, 2020. Gross Gain/(Loss) to SVF1 is the difference between
Slide 80: SVF1 Listed Portfolio Companies
SVF1 Listed Portfolio Companies (as of December 31, 2020) ※3 1. Listed company total only includes companies that have become publicly listed on or after the date SVF1 made its initial investment in the companies. The companies indicated as fully exited are fully exited companies that became publicl
Slide 81: SVF2 Snapshot
SVF2 Snapshot (as of December 31, 2020) 1. Gross Return to SVF2 is Fair Market Value of unrealized investments held by SVF2 as of December 31, 2020. Gross Gain/(Loss) to SVF2 is the difference between the Gross Return to SVF2 and Investment Cost to SVF2. Gross Realized Proceeds are before tax and ex
Slide 82: SVF2 Listed Portfolio Companies
SVF2 Listed Portfolio Companies (as of December 31, 2020) 1. Listed company total only includes companies that have become publicly listed after SVF2 made its initial investment in the companies. 2. Gross Return = Unrealized value. SBG’s return on any SVF2 portfolio company is not the full return am
Slide 83: Entry into Agreement for Sale of Shares in Arm to NVIDIA
Entry into Agreement for Sale of Shares in Arm to NVIDIA Remain committed to the long-term success of NVIDIA as a major shareholder (approximately 6.7- 8.1% ownership expected). Received by the Company as a deposit*1 Cash $2.0B Cash $10.0B To be received by the Company*2 Transaction upon closing val
Slide 84: Amendments of Collar Contracts
Amendments of Collar Contracts Amended the collar contracts to capture the upside potential. Transaction cost was recorded as a one-time loss. Before change of terms After change of terms Gain (loss) from collar Gain (loss) from collar transactions transactions Upside potential can be No further gai
Slide 85: Consolidated SBG: Interest-bearing Debt, Cash Position, and Net Debt
Consolidated SBG: Interest-bearing Debt, Cash Position, and Net Interest-bearing Debt Consolidated Interest-bearing Debt*1 (\ B) Dec.19 Mar.20 Jun.20 Sep.20 Dec.20 SBG standalone 7,969.0 8,281.3 9,803.6 9,319.8 11,218.9 Incl. SB Northstar - - - 364.3 1,528.8 SVF1 and SVF2 721.3 581.5 159.1 156.3 260
Slide 86: Consolidated SBG: Interest-bearing Debt, Cash Position, Net Debt Notes
Consolidated SBG: Interest-bearing Debt, Cash Position, and Net Interest-bearing Debt Notes Consolidated Interest-bearing Debt *1 The presented interest-bearing debt only includes interest-bearing debt and lease liabilities to third parties and excludes deposits for banking business at The Japan Net
Slide 87: SoftBank Vision Funds Update
QUARTER ENDED DECEMBER 31, 2020 SoftBank Vision Funds Update NAVNEET GOVIL Managing Partner & Chief Financial Officer SoftBank Investment Advisers
Slide 88: Important Information (1 of 2)
2 Important Information (1 of 2) 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”) in SoftBank Vision Fund L.P. (together with, as the context may require, any par
Slide 89: Important Information (2 of 2)
3 Important Information (2 of 2) Vision Fund I performance herein is based on unrealized valuations of portfolio investments. Valuations of unrealized investments are based on assumptions and factors (including, for example, as of the date of the valuation, average multiples of comparable companies,
Slide 90: Topics
4 Topics 01- Progress & Highlights 02- Performance & Impact on SoftBank Group (SBG) 03- In Focus: Validation of Our Vision
Slide 91: Progress & Highlights
Progress & Highlights Investment Advisers
Slide 92: SPAC Launch
PROGRESS & HIGHLIGHTS 6 SPAC Launch Leveraging Our Flexibility as an Investor SoftBank Vision Fund 2 Role of SoftBank Investment Advisers SPAC Public SVF2 Commitment Offering Size to PIPE1 Tech & AI Focused High Growth Opportunities Lock-Up Period Warrants PRIVATE PRE-IPO STAGE PUBLIC Footnotes: 1.
Slide 93: SVF1: DoorDash IPO Creates Significant Value
PROGRESS & HIGHLIGHTS 7 SVF1: DoorDash IPO Creates Significant Value As of February 05, 2021 Gross MOIC1 Gross Unrealized Gain2 Current Market Cap3 NYSE: DASH Cost4 Trading Activity5 FEB 05, 2021 +86% IPO – DEC 08, 2020 DEC 21, 2018 2020 Footnotes: 1. Gross MOIC (Gross Multiple of Invested Capital)
Slide 94: SVF1 & SVF2: Additional New Listings
PROGRESS & HIGHLIGHTS 8 SVF1 & SVF2: Additional New Listings As of February 05, 2021 SVF1 SVF2 NASDAQ: OPEN Gross MOIC1 Gross Unrealized Gain2 NASDAQ: SEER Gross MOIC1 Gross Unrealized Gain2 4.4x $1.5B 1.7x $0.1B 3 3 4 Cost Trading Activity4 Cost Trading Activity FEB 05, 2021 FEB 05, 2021 SPAC ANNOU
Slide 95: SVF1 & SVF2: Public Listings Since Inception
PROGRESS & HIGHLIGHTS 9 SVF1 & SVF2: 13 Public Listings Since Inception As of December 31, 2020 SVF1 NYSE: DASH NASDAQ: OPEN NASDAQ: RLAY NYSE: OCFT NASDAQ: VIR NYSE: UBER SVF2 GROSS MOIC1 GROSS MOIC1 GROSS MOIC1 GROSS MOIC1 GROSS MOIC1 GROSS MOIC1 13.2x 3.7x 3.9x 0.9x 3.0x 1.5x 2 2 2 BEIKE NASDAQ:
Slide 96: Performance Snapshot
10 SoftBank SoftBank Vision Fund 1 Vision Fund 2 Combined Total Commitment $98.6B $10.0B $108.6B PROGRESS & HIGHLIGHTS Performance Acquisition Cost1 $84.8B $4.3B $89.1B Snapshot Cumulative $22.6B $5.0B $27.6B Investment Gains1 As of December 31, 2020 Total Fair Value2 $107.4B $9.3B $116.7B Distribut
Slide 97: SVF1 Portfolio Overview
PROGRESS & HIGHLIGHTS 11 SVF1 Portfolio Overview As of December 31, 2020 NO. OF PORTFOLIO COMPANIES BY GEOGRAPHY PORTFOLIO FAIR VALUE BY SECTOR 92 10 Consumer Fintech Logistics Total Investments Investments Made1 Exited2 7 44 31 Edtech Frontier Tech Proptech 74 Current Private 8 Current Public AMERI
Slide 98: SVF2 Portfolio Overview
PROGRESS & HIGHLIGHTS 12 SVF2 Portfolio Overview As of December 31, 2020 NO. OF PORTFOLIO COMPANIES BY GEOGRAPHY PORTFOLIO FAIR VALUE BY SECTOR 26 - Consumer Fintech Logistics Total Investments Investments Made1 Exited2 3 12 11 Edtech Frontier Tech Proptech 24 Current Private 2 Current Public AMERIC
Slide 99: SVF1: Measurable Value in Our Portfolio
PROGRESS & HIGHLIGHTS 13 SVF1: Measurable Value in Our Portfolio As of December 31, 2020 Total Acquisition Cost1 Cumulative Investment Gains1 Total Fair Value1,3 $84.8B $22.6B $107.4B Realized Investments2 Unrealized Investments FULL & PARTIAL PUBLIC PRIVATE $66.9B $67.6B $24.8B $15.0B $9.7B $8.2B C
Slide 100: Performance & Impact on SoftBank Group (SBG)
14 Performance & Impact on SoftBank Group (SBG)
Slide 101: SVF1 Contribution to SBG, Net of 3rd Party Interests
15 SVF1 2019 2020 Nine-Month Period Ended Dec 31 Dec 31 Fund Net Profit (Loss)2 ($6.20) $17.46 PERFORMANCE & IMPACT ON SBG Less: Change in 3rd Party Contribution to Interests in Fund 3.28 (8.49) SBG, Net of 3rd SBG LP Income (Loss): (2.92) 8.97 Share of Fund Net Profit (Loss) Party Interests1 Amount
Slide 102: SVF1 Contribution to SBG, Net of 3rd Party Interests (Inception to Date)
16 SVF1 2020 Inception to Dec 31 Fund Net Profit2,3 $13.45 PERFORMANCE & IMPACT ON SBG Less: Change in 3rd Party Contribution to Interests in Fund (6.38) SBG, Net of 3rd SBG LP Income: 7.07 Share of Fund Net Profit Party Interests1,3 Amounts in USD billions SBG GP Income: Management Fees & Performan
Slide 103: Contribution to SBG, Realized and Unrealized Values: SVF1
17 SBG Paid-In Capital SVF1 PERFORMANCE & IMPACT ON SBG Contribution to SBG, Realized and SBG Total Value4 Net Asset Value1 Unrealized Values (Unrealized Value): As of December 31, 2020 Distributions2 (Realized Value): Accrued & Paid Performance Fees3 Footnotes: 1. Net Asset Value includes net chang
Slide 104: Contribution to SBG, Realized and Unrealized Values: SVF2
18 SBG Paid-In Capital SVF2 PERFORMANCE & IMPACT ON SBG Contribution to SBG, Realized and SBG Total Value3 Unrealized Values Net Asset Value1 (Unrealized Value): As of December 31, 2020 Accrued Performance Fees2: Footnotes: 1. Net Asset Value includes net changes in fair value of financial assets at
Slide 105: In Focus: Validation of Our Vision
19 In Focus: Validation of Our Vision
Slide 106: Deeply Engaged with Our Existing Portfolio
VALIDATION OF OUR VISION 20 Deeply Engaged with Our Existing Portfolio 2019 2020 COVID-19 Focus on Liquidity & Cash Runway Focus on Strengthening Governance Focus on Path to Profitability Focus on Unit Economics The information herein is provided solely for illustrative purposes, reflects the curren
Slide 107: Validation of Our Vision
VALIDATION OF OUR VISION 21 Validation of Our Vision 2020 2021+ COVID-19 Accelerating Continuing Unlocking Value through Technological Shifts to Invest Public Listings and M&A +25 BEIKE FUNDING +2 RO UNDS 1 STRATEG IC EXITS 1 +5 PUBLIC LISTING S 1 Footnotes: 1. Funding Rounds, Public Listings and St
Slide 108: Accelerating Technological Shifts
VALIDATION OF OUR VISION 22 Accelerating Technological Shifts Education Food Delivery Healthcare SoftBank Entertainment Vision Funds1 Future of Work E-Commerce Footnotes: 1. SoftBank Vision Funds includes SoftBank Vision Fund 1 and Softbank Vision Fund 2 Investments. Information herein reflects curr
Slide 109: Continuing to Invest
VALIDATION OF OUR VISION 23 Continuing to Invest Twelve-Month Period Ended December 31, 2020 Number of Transportation Logistics Health Tech Frontier Tech Edtech Consumer Investments 1 Made SVF1 Capital 2 Invested SVF2 Footnotes: 1. Number of Investments Made include new Investments, follow-on Invest
Slide 110: Institutional Investors Leading New Rounds
VALIDATION OF OUR VISION 24 Institutional Investors Leading New Rounds PRE-MONEY VALUATIONS 28 GUAZI UNDISCLOSED UNDISCLOSED Series E-1 Series H Series D+ Series A-16 Series E+ Series E-1 Series D Funding Rounds1 $178.0B $15.6B $11.7B $10.0B $10.0B $8.7B $8.5B $15B+ Capital Raised Series I Series E
Slide 111: Unlocking Value Through Public Listings
VALIDATION OF OUR VISION 25 Unlocking Value Through Public Listings SVF1 SVF2 Public Investment Value1 $25.4B Public Investment Value1 2 $6.6B 2 Unrealized Gross Gain Unrealized Gross Gain Acquisition Cost3 Acquisition Cost3 +$13.5B $14.6B UNREALIZED GAIN $5.2B $10.6B $1.1B +$5.2B UNREALIZED GAIN $9
Slide 112: Exits and M&A Creating Realized Value
VALIDATION OF OUR VISION 26 Exits and M&A Creating Realized Value SVF1 GROSS PORTFOLIO EXIT REALIZED COMPANY STATUS Gross Realized Proceeds1 PROCEEDS $0.3B $1.0B GROSS REALIZED PROCEEDS $27.3B $0.8B UNDISCLOSED EXITS Other Undisclosed Full & Partial $2.7B $10.2B $2.2B 3 $10.1B Dec 2019 Dec 2020 Pro-
Slide 113: SVF1: Portfolio Evolution
27 Exited1 $108.0B Public2 Private3 $90.0B $27.3B $10.2B Represents Represents Combined Exited & Combined Exited & VALIDATION OF OUR VISION $10.6B Public Fair Value4 Public Fair Value4 $25.4B SVF1: Portfolio Evolution $69.2B $55.3B Dec 2019 Dec 2020 Pro-Forma5 Footnotes: 1. Exited represents the Gro
Slide 114: AI Revolution Flywheel
28 Consumer Health Tech Edtech Logistics Enterprise Proptech Fintech Transportation Frontier Tech VALIDATION OF OUR VISION Ecosystem Synergies AI Revolution Geographic Flywheel Expansion 12-14 YEARS Operational Distributions to LPs Support Public Markets Strategic M&A IPO, DPO, or SPAC The informati
Slide 115: Thank You
29 Thank You = SoftBank
Slide 116: SoftBank
SoftBank