Slide 1: Earnings Results for the 9-month Period Ended December 31, 2014
Earnings Results for the 9-month Period Ended December 31, 2014 February 10, 2015 SoftBank Corp.
Slide 2: 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 3: Consolidated Results of Operations
Consolidated Results of Operations 2
Slide 4: Net Sales
Net Sales (JPY) 6.4t Up 41% 4.6t YoY 2003 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 (FY) Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Japanese-GAAP IFRSs 3
Slide 5: EBITDA 1.6t
EBITDA 1.6t (JPY) 1.3t Up 22% YoY 2003 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 (FY) Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Japanese-GAAP IFRSs 4
Slide 6: EBIT (Operating income) down 16%
EBIT (Operating income) 940.6bn (JPY) 788.0bn 248.6bn Temporary gains from consolidation of GungHo, WILLCOM, etc. Down 16% 2003 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 (FY) Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Japanese-GAAP IFRSs 5
Slide 7: EBIT
EBIT (Operating income) 940.6bn (JPY) 788.0bn 248.6bn Up 14% Temporary gains from consolidation of GungHo, WILLCOM, etc. 692.0bn excluding temporary gains 2003 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 (FY) Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Japanese-GAAP IFRSs 6
Slide 8: Net Income
Net Income (Net income attributable to owners of the parent) 579.4bn (JPY) 499.8bn Up 16% YoY Including dilution gain of JPY 385.9bn from changes in equity interest related to Alibaba 2003 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 (FY) Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Ja
Slide 9: Summary of Consolidated Operation Results
Summary of Consolidated Operation Results (JPY) FY13/Q1-3 FY14/Q1-3 Change YoY Net sales 4,561.7bn 6,431.2bn + 1,869.5bn 141% EBITDA 1,316.0bn 1,609.7bn + 293.7bn 122% EBIT 940.6bn 788.0bn - 152.6bn 84% (Operating income) *excluding temporary 692.0bn 788.0bn + 96.0bn 114% gains Net income 499.8bn 57
Slide 10: FY2014 Forecast
FY2014 Forecast Net sales JPY 8t EBITDA approx. JPY 2t EBIT (Operating income) JPY 900bn 9
Slide 11: SoftBank Business Domains: Communications
SoftBank Business Domains Communications Internet 10
Slide 12: SoftBank Business Domains: Communications
SoftBank Business Domains Communications Internet 11
Slide 13: Mobile EBIT: 10x in 9 years
Mobile EBIT (Mobile operating income) 571.8bn (JPY) 10x 521.2bn in 9 years 57.2bn 2003 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 (FY) Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Q1-3 Japanese-GAAP IFRSs *FY2006-2011: operating income of Mobile Communications business FY2012-2014: segmen
Slide 14: Smartphone Data Connectivity No.1
Smartphone Data Connectivity 99% SoftBank 98.9% Smartphone 98% NTT DOCOMO 98.1% connectivity 97% au 97.5% No.1 96% 95% 2013 2015 *Statistics analyzed by Agoop Corp. Platinum band-compatible smartphone data connection: total 120,000 platinum band-compatible smartphones (40,000 for each operator) were
Slide 15: Smartphone data communications speed No.1
Smartphone data communications speed No.1 (Nationwide downlink speeds / Analysis of 3.60mil data logs) SoftBank 37.5 20.7 Mbps Mbps au 33.1 17.0 MbpsMbps NTT DOCOMO 28.0 16.1 MbpsMbps (Source) Agoop “Analysis of Data Communications Speed of Smartphones” (Dec. 31, 2014) Data collected from Oct. 1, 20
Slide 16: Jointly promote work style revolution
× Jointly promote work style revolution 20,000+ iPads introduced SB innovation know-how 15 *Actual number introduced throughout Mizuho Financial Group as of Dec. 2014.
Slide 17: Android Units Sold Up 63% YoY
Android Units Sold Up 63% YoY Oct. - Dec. 2013 Oct. - Dec. 2014 Total of SoftBank Mobile and Ymobile (new subscriptions & handset upgrades) 16
Slide 18: Newly sold Android units No.1
Newly sold Android™ units No.1 *Mobile phones for the Aug. - Jan. 2015 period. Android OS Share of units by operator within new subscriptions 17 Total of nationwide electronics retail stores GfK Japan research
Slide 19: Smartphone & Internet Bundle Discount
Smartphone & Internet Bundle Discount Discount on mobile monthly usage charge when combined with fixed-line Max. JPY 2,000 discount/line *Applicable to customers subscribing to SoftBank mobile phones and fixed-line services designated by SoftBank who apply to Smartphone & Internet Bundle Discount. C
Slide 20: Student Discount with Family
Student Discount with Family Family members of children ages 25 and under JPY 540 discount/month & 1GB extra Customers aged 25 and under TSUTAYA CD rental substantially half-price etc. *When subscribing to Smartphone Flat-rate. Privileges apply to both family members & child until the month the chil
Slide 21: Agreement on Development of Japanese-enabled IBM Watson
Agreement on Development of Japanese-enabled IBM Watson × Jointly create the cognitive technology market IBM Japan and SoftBank Telecom announced the agreement “IBM, SoftBank Alliance to Bring Watson to All of Japan.” 20 For details, please refer to IBM’s news release issued on Feb. 10, 2015.
Slide 22: Further growth & efficiency: merger of group companies
SoftBank Mobile Corp. SoftBank BB Corp. SoftBank Telecom Corp. Ymobile Corporation Merger April 1, 2015 (plan) SoftBank Mobile Corp. Further growth & efficiency 21
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Slide 24: Impairment Loss
Impairment Loss USGAAP IFRSs (Sprint) (SoftBank) USD 2.13bn None 23
Slide 25: Difference in Recognition of Impairment Loss
Difference in Recognition of Impairment Loss (Consider following for each CGU) USGAAP IFRSs (Sprint) (SoftBank) Impairment test on Impairment individual assets and lower level test on asset groupings total of assets 24
Slide 26: IFRSs Impairment test result: No impairment
IFRSs Impairment test result Recoverable Net assets carrying amount < amount (1) Share price (2) DCF-debt Whichever is higher No impairment *Considering control premium 25
Slide 27: Net Income and FCF
(USD) Net Income FCF -1.9bn Impact of impairment -1.4bn (After recognition of deferred tax) -3.0bn -3.3bn -3.5bn -4.6bn 2010 ’11 ’12 ’13 ’14 (CY) 2010 ’11 ’12 ’13 ’14 (CY) Jan. - Dec. Jan. - Dec. Jan. - Dec. Jan. - Dec. Jan. - Dec. Jan. - Dec. Jan. - Dec. Jan. - Dec. Jan. - Dec. Jan. - Dec. *Combine
Slide 28: Status after Marcelo's appointment
Status after Marcelo’s appointment 27
Slide 29: Improve customer experience
Customer Customer Network acquisition retention Cost structure People Improve customer experience 28
Slide 30: Gross Additions: Highest ever
Gross Additions (postpaid & prepaid) Highest ever Marcelo’s appointment Prepaid Postpaid 2013 2014 *Sprint Platform Oct. - Dec. Jan. - Mar. Apr. - June July - Sept. Oct. - Dec. 29
Slide 31: Net Additions (postpaid): Turnaround
Net Additions (postpaid) Marcelo’s appointment Turnaround +30k 2013 2014 2014 2014 2014 Oct. - Dec. Jan. - Mar. Apr. - June July - Sept. Oct. - Dec. *Sprint Platform 30
Slide 32: Sprint Network Quality
Sprint Network Quality Dropped Call Index [Sprint vs. Competitors] Dropped call rate Improved Sprint 2007 ’08 ’09 ’10 ’11 ’12 ’13 ’14 (CY) *Based on analysis by Sprint using syndicated independent, 3rd party field drive test information supplied by Nielsen 2007-2014 as of Dec. 31, 2014. Historical d
Slide 33: Cost Reductions
Cost Reductions 1 Optimize vendors and partners 2 Rationalize workforce 3 Zero-based budgeting 4 Review additional areas 32
Slide 34: SoftBank Business Domains: Internet
SoftBank Business Domains Communications Internet 33
Slide 35: Internet Allies
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Slide 36: Investment focus areas
Advertising media E-commerce games Early / growth Transportation stage platform investments Investment focus areas 35
Slide 37: Invest in growth regions: E-commerce
E-commerce Invest in growth regions 36
Slide 38: Rapid growth
(JPY) 40t 40t GMV 30t Rapid growth 20t 21t 10t (Source) Created by SoftBank Corp. based on respective companies’ publicly available historical information published by Alibaba Group Holding Limited. USD 1.00 = JPY 120, RMB 1.00 = JPY 17.49 Amazon.com: consolidated net sales 2007 ’08 ’09 ’10 ’11 ’12
Slide 39: Taobao mobile app
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Slide 40: Rapid growth in mobile
*1 *2 Mobile MAU Mobile GMV Mobile Net Revenue *3 265mil JPY 6.3t JPY 124.2bn 136mil 2013 '14 Apr. - June July - Sept. Oct. - Dec. 2011 ’12 ’13 2014 2012 ’13 ’14 Oct. - Dec. Jan. - Mar. Oct. - Dec. Oct. - Dec. Oct. - Dec. Oct. - Dec. Oct. - Dec. Oct. - Dec. Oct. - Dec. Rapid growth in mobile (Source
Slide 41: No.1 online marketplace in India
No.1 online marketplace in India 40
Slide 42: No.1 online marketplace in Indonesia
No.1 online marketplace in Indonesia 41
Slide 43: Invest in growth regions: Transportation platform
Transportation platform Invest in growth regions 42
Slide 44: No.1 transportation platform in India
No.1 transportation platform in India 43
Slide 45: No.1 transportation platform in Southeast Asia
No.1 transportation platform in Southeast Asia 44
Slide 46: No.1 transportation platform in China
No.1 transportation platform in China 45
Slide 47: Invest in growth areas: Advertising, media, games
Advertising, media, games Invest in growth areas 46
Slide 48: House hunting platform in India
House hunting platform in India 47
Slide 49: Early / growth stage investments
Early / growth stage investments 48
Slide 50: SoftBank Business Domains: Internet
SoftBank Business Domains Internet 49
Slide 51: 34 Years Since Foundation
34 Years Since Foundation 50
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Slide 53: The view is different when you challenge yourself
The view is different when you challenge yourself Masayoshi Son 52
Slide 54: Information Revolution - Happiness for everyone
Information Revolution - Happiness for everyone 53
Slide 55: SoftBank
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Slide 56: Adoption of IFRSs; Definition of terms; Trademarks
1. Adoption of IFRSs SoftBank Corp. has adopted the International Financial Reporting Standards (IFRSs) from the three-month period ended June 30, 2013 (transition date: April 1, 2012). The financial data for the three-month period ended June 30, 2012 (“YoY”) and the fiscal year ended March 31, 2013