Slide 1: Financial results briefing for the 4Q of FY2017
Financial results briefing for the 4Q of FY2017 (October 1, 2016 - September 30, 2017) Status of our business expansion toward achieving mid-term goal November 6, 2017 The 51st IR Meeting GMO Payment Gateway, Inc. (3769: Tokyo Stock Exchange Section-1) https: //c orp. gmo - pg. c om/e n/
Slide 2: A cautionary note about the contents of the document
A cautionary note about the contents of the document 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 6, 2017. However, please note that they are subject to change with
Slide 3: Agenda
Agenda 1. Summary of financial results for FY2017 2. Earnings forecast for FY2018 3. Future actions to implement growth strategies 4. Financial highlights 5. Reference materials Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 3
Slide 4: 1. Summary of financial results for FY2017
1. Summary of financial results for FY2017 Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 4
Slide 5: Business performance
1.1 Business performance OP +31.3％; transaction value at ¥2.5 trillion (+29.3％) Initial vs. Initial （Million yen） FY2016 FY2017 YoY change forecast forecast Revenue 12,113 18,767 21,794 +79.9％ +16.1％ Operating profit 3,819 5,013 5,015 +31.3％ +0.0％ Ordinary profit 3,780 4,673 4,739 +25.4％ +1.4％ Net p
Slide 6: Factors that affected the cumulative results
1.2 Factors that affected the cumulative results Net profit over plans & FY16 level with PS tax effect accounting +79.9％ Revenue 22,000 million yen ・Expansion of services to financial institutions ・Acquisition of a major merchant by GMO-PS 20,000 ・Consolidation of FG and Macro Kiosk 18,000 Cost of r
Slide 7: Quarterly results
1.3 Quarterly results 4Q Revenue up by 84.8% YoY, OP up by 24.5％ YoY ■ FY2017 Quarterly results (consolidated) ％: YoY changes （million yen） Revenue +84.8％ （million yen）Operating profit 1,400 +30.4％ 6,000 +85.0％ +32.4％ +88.3％ 1,200 +37.9％ 5,000 +24.5％ +59.1％ 1,000 4,000 800 3,000 600 2,000 400 1,000
Slide 8: Revenue/OP by segment
1.4 Revenue/OP by segment Strong revenue growth in all segments with profit of payment processing business up by 30% ()：YoY change ■Revenue by segment ■ OP by segment (before consolidation adjustment) （million yen） （million yen） 7,000 508 20,000 （+218.8％） 4,078 （+229.2％） 6,000 226 159 （＋4.2％） 15,000
Slide 9: Revenue breakdown by business model
1.5 Revenue breakdown by business model All business models grew more than 25% (million yen) Spread YoY＋78.2％ 20,000 ・Expansion of MSB (GMO payment after delivery)* 10,000 ・Transaction value increase Fee YoY＋129.5％ 15,000 ・MK consolidation effect ・Expansion of MSB (GMO payment after 6,735 delivery)*
Slide 10: Overview of FY2017
1.6 Overview of FY2017 Reinforced business base through challenges from high-growth Challenges Highlights ・Incident of the March 9th ・ Services for financial institutions Implemented prevention measures (done) Prepared for “GMO-PG Processing Platform” Organization-wise reinforcements (announced on O
Slide 11: 2. Earnings forecast for FY2018
2. Earnings forecast for FY2018 Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 11
Slide 12: Full-year forecast (J-GAAP)
2.1 Full-year forecast（J-GAAP） Remain committed to deliver OP CAGR of 25% ■ FY2018 （Unit：million yen） （million yen） FY2017 FY2018 YoY change Revenue 21,794 27,283 +25.2％ Operating profit 5,015 6,269 +25.0％ Net profit 2,948 3,635 +23.3％ EBITDA 5,919 7,594 ＋28.2％ DPS (yen) 40.0 49.0 ＋9.0 ※EBITDA＝Opera
Slide 13: Earnings forecast by segment (consolidated)
2.2 Earnings forecast by segment (consolidated) Measures to achieve our target ■Revenue by segment （million yen） Payment enhancement business 3.6 (+38.0％ YoY） ・Consolidated an entire year of MK 25,000 5,627 ・Strengthened overseas business （+38.0％） ・Margin of Online advertising business rose 20,000 4
Slide 14: Full-year forecast (IFRS)
2.3 Full-year forecast (IFRS) Comparison of consolidated forecasts 【J-GAAP and IFRS】 Outlook for FY2018 J-GAAP IFRS IFRS figures compared with vs. vs. J-GAAP (billion yen) revenue (billion yen) revenue (%) (%) Revenue 27.2 100 26.1 100 -1.1 -4％ Operating profit 6.2 23 6.4 25 +0.2 +3％ Revenue Changes
Slide 15: 3. Future actions to implement growth strategies
3. Future actions to implement growth strategies Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 15
Slide 16: Business area expansion
3.1 Business area expansion All businesses enjoyed market expansion & stay on high growth X Processing Cashless promotion Smart payment Fully start fintech business Businesses for Rev. Banking Act banks Open API Payment ¥300 bil market with CAGR 40% after delivery Accumulated MSB transaction data Po
Slide 17: Short-term outlook: 2017-2020
3.2 Short-term outlook：2017-2020 Outlook and measures to achieve ¥10 billion OP in 2020 Up until 2017 2020 and beyond Establishment of ecosystem Reinforcement of ecosystem Operating profit ¥5 billion ¥10 billion Transaction value ¥2.5 trillion ¥6-7 trillion Business strategies Tapped into growing
Slide 18: Three strategies to note for FY2018
3.3 Three strategies to note for FY2018 Enhance ecosystem and new businesses (processing/smart payment) Strategy 2）Processing and smart payment business expansion Processing / Smart payment Strong system development capabilities, high-volume processing capabilities and know-how accumulation Solution
Slide 19: Payment processing: Processing business / Smart payment
Processing business / 3.4.1 Payment processing: Smart payment Client base to expand from merchants to financial institutions Card brands Issuers Acquirers Debit Credit Prepaid House Existing business area (payment processing) Consumers Merchants 2017 Oct. Released GMO Processing Platform to financia
Slide 20: Expansion of services to financial institutions
Processing business / 3.4.2 Payment processing: Smart Payment Support FinTech businesses by financial institutions, etc. to ultimately bring payments towards cashless Cashless Changes in markets or environments payment ratios ■Going cashless Expansion of services to financial institutions ■Restructu
Slide 21: Money Service Business (MSB)
3.5.1 Money Service Business (MSB) Solid assets and revenue; segment profit highest for a quarter Transaction lending Early payment service Payment after delivery Finance lease Remittance Segment profit Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 21
Slide 22: Money Service Business (MSB)
3.5.2 Money Service Business (MSB) Work to improve MSB’s margin to enlarge segment profit Asset increase not factored into forecast 2016/9 2017/9 2018/9 ¥15.9 bil → ¥39.1 bil (+145％） Plan to be on par PS included in the above with FY2017 ¥1.7 bil → ¥14.6 bil (+742％） Margin improvement of each MSB se
Slide 23: Overseas business strategies (expansion phase)
3.6 Overseas business strategies (expansion phase) Three strategies of regional expansion, business area expansion and alliance with global giants ・ASEAN business and investment portfolio The first investment fund in Dominant in the competition-free market Japan dedicated to payment Stayed in the to
Slide 24: 4. Financial highlights
4. Financial highlights Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 24
Slide 25: Consolidated balance sheet
4.1 Consolidated balance sheet Assets related to Payment after delivery and early payment up by ¥10 billion+ respectively End of 4Q End of 4Q End of 4Q End of 4Q （Million yen） Change （Million yen） Change 2017 2016 2017 2016 Current asset 72,347 45,549 26,798 Current liabilities 57,820 35,330 22,489
Slide 26: Major KPIs (Quarterly)
4.2 Major KPIs（Quarterly) Annual transaction value reaches ¥2.5 trillion Operating stores: 82,349; Transaction value ¥670 billion; Transaction volume 288 million （Stores）（billion yen） （Million） 650 （Reference）Transaction value（cumulative 12 months） ¥2.55 trillion 90,000 Including GMO Financial Gate
Slide 27: 5. Reference materials
5. Reference materials Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 27
Slide 28: Cost of revenue ratio/SG&A ratio (Quarterly)
5.1 Cost of revenue ratio/SG&A ratio (Quarterly） Cost of revenue ratio depends on sales composition *Figures with asterisk exclude MSB-related outsourcing expenses （million yen） 6,086 *50.2％ 6,000 52.7% *44.5％ *47.2％ 5,645 5,716 50.3% 50.4% *41.7％ 50.0% 46.8% 45.6% *40.3％ 5,000 43.6% 44.2% 42.6% 43.
Slide 29: Revenue breakdown (Quarterly)
5.2 Revenue breakdown（Quarterly） Revenue growth accelerated in all business models 2,773 （Million yen） Year-over-year 2,653 2,500 Initial +76.3％ 2,471 Stock ＋ 24.7％ Fee ＋152.4％ 2,101 2,004 2,000 Spread ＋ 81.6% 1,895 1,809 1,527 1,441 1,500 1,383 1,227 1,259 1,026 980 931 959 929 1,000 794 906 875 80
Slide 30: Consolidated cash flows
5.3 Consolidated cash flows Positive OCF with earnings growth and deposit growth ¥4 billion borrowing to boost MSB 8,000（million yen） OCF： ＋¥1,749 million Pretax profit +¥4,470 mil 6,000 Reserves increase +¥1,996 mil Advance payments increase -¥10,417 mil 4,000 AR increase -¥12,775 mil AP increase ＋
Slide 31: Thank you very much!
Thank you very much! GMO Payment Gateway Inc. (TSE:3769) URL https://corp.gmo-pg.com/en For more information, please contact the Corporate Value Creation Strategy Division Investor relations office TEL:+81-3-3464-0182