Softbank Group Corp. · TSE:9984
Softbank — Q1 FY2020 Earnings Presentation
108 slides from Softbank's earnings presentation, Aug 12, 2020
Slide 1: Earnings Results for the Three-month Period Ended June 30, 2020
Ver.1 Earnings Results for the Three-month Period Ended June 30, 2020 Investor Briefing August 12, 2020 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 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 1 CNY 16.13 15.37 15.46 15.56 15.16 EOQ Jun 30 Sep 30 Dec 31 Mar 31 Jun 30 1 USD 108.83 107.74 1 CNY 15.31 15.23 Abbreviations Abbreviations used in Accounting an
Slide 4: Index
Index Accounting Finance Consolidated Results P 2 Summary of FY2020 Q1 P 2 Cash Position P 26 Changes in Presentation of P/L P 3 SBG Share Price and Credit Spread P 4 SBG Standalone Interest-bearing Debt P 27 Change in Reportable Segments P 4 ¥4.5T Program P 5 SBG Standalone Cash Position P 28 Inves
Slide 5: Accounting
Accounting
Slide 6: Consolidated Results
Consolidated Results (JPY bn) FY19Q1 FY20Q1 Change YoY Net sales 1,480.3 1,450.1 -30.2 -2.0% Income before 1,695.0 833.0 -862.0 -50.9% income tax Net income (attributable to owners 1,121.7 1,255.7 134.0 11.9% of the parent) Accounting 2
Slide 7: Changes in Presentation of P/L
Changes in Presentation of P/L ➢ “Gain (loss) on investments” is newly presented P/L after the revision of the presentation ➢ Operating income is no longer used Net sales • The importance of investment activities has increased in Gross profit the consolidated results, following the completion of Spr
Slide 8: Change in Reportable Segments
Change in Reportable Segments • In FY20Q1, “Investment Business of Holding Companies” is established as a new segment. • Segment income was revised to “income before income tax, from "operating income", to include income (loss) on equity method investments. FY19 SoftBank Vision Fund and Other SoftBa
Slide 9: Investment Business of Holding Companies Segment
Investment Business of Holding Companies Segment • Main businesses: Investment activities by SBG and its subsidiaries • Core companies: SBG, SoftBank Group Capital Limited(SBGC) and SoftBank Group Japan(SBGJ) SBG SBGC Subsidiaries SBGJ and others Indirect investment Direct investment Investments (Ap
Slide 10: Segment Income - Investment Business of Holding Companies
Segment Income - Investment Business of Holding Companies (JPY bn) P/L FY19Q1 FY20Q1 Items Gain on investments 1,226.3 650.5 (1) Gain of 280.3 bn on the partial sale of T-Mobile shares (2) Gain of 296.0 bn on the revaluation of T-Mobile shares continued to be held by the Company Gain relating to sal
Slide 11: Completion of the Merger of Sprint/T-Mobile US, Inc.
Completion of the Merger of Sprint/T-Mobile US, Inc. • On April 1, 2020, the merger of Sprint/T-Mobile US, Inc. was completed. • The Company received T-Mobile’s 304,606,049 shares and contingent consideration (the right to purchase T-Mobile’s 48,751,557 shares if certain conditions are met). • Sprin
Slide 12: Partial Sale of T-Mobile Shares and Evaluation at Q1-end
Partial Sale of T-Mobile Shares and Evaluation at Q1-end • The Company sold its T-Mobile share on June 26, 2020, and received JPY 1,830.4 bn. Deutsche Telekom received call options for T-Mobile shares held by the Company. • As a result of the decrease in the voting rights following the sale of share
Slide 13: Conclusion of Prepaid Forward Contracts Using Alibaba Shares
Conclusion of Prepaid Forward Contracts Using Alibaba Shares • From Apr to Jun 2020, SBG’s wholly owned subsidiaries* entered into several prepaid forward contracts using Alibaba shares and procured an aggregate amount of USD 13.7 bn. • B/S (at the signing of contracts): “Financial liabilities relat
Slide 14: Accounting Treatment for Partial Sale of SBKK Shares
Accounting Treatment for Partial Sale of SBKK Shares and After-tax Cash Proceeds • In May 2020, SBG sold 240 mil. shares (shareholding ratio: 5.0%) of SBKK held through SBGJ for JPY 310.2 bn. • Shareholding ratio after the sale is 62.1%. (JPY bn) (5)Accrued cash tax 37.9 (The amount of taxes expecte
Slide 15: Consolidated P/L Summary (IFRSs)
Consolidated P/L Summary (IFRSs) P/L item FY19Q1 FY20Q1 Change (JPY bn) Continuing operations Net sales 1,480.3 1,450.1 -30.2 Gross profit 667.6 707.8 +40.3 Gain on investments Gain on investments at Investment Gain on investments at Investment Business Holding of Companies: +650.5 bn Business of Ho
Slide 16: Consolidated B/S Summary (IFRSs) - Assets
Consolidated B/S Summary (IFRSs) - 1 B/S As of As of (JPY bn) Main items Change item Mar 2020 Jun 2020 15,636.9 9,371.0 -6,265.9 1 Current assets 3,369.0 1 Increased mainly due to the sale and monetization of assets under the JPY 4.5 trillion Cash and cash equivalents 6,181.3 +2,812.3 program. Trade
Slide 17: Consolidated B/S Summary (IFRSs) - Liabilities
Consolidated B/S Summary (IFRSs) - 2 B/S As of As of (JPY bn) Main items Change item Mar 2020 Jun 2020 1,4191.1 7,625.1 -6,566.0 Interest-bearing debt 3,845.2 3,525.3 -319.9 Lease liabilities 378.4 357,2 -21.2 Current liabilities Deposits for banking business 873.1 982.2 +109.1 Increased due to the
Slide 18: 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 Jun 2020 7,372.9 7,576.8 +203.9 Common stock 238.8 238.8 － Changes in interests in subsidiaries in conjunction with the partial sale of Capital surplus 1,490.3 1,666.1 +175.8 SBKK shares: +194.7 bn Other equity
Slide 19: Consolidated C/F Summary (IFRSs)
Consolidated C/F Summary (IFRSs) (JPY bn) C/F item FY20Q1 C/F from 504.2 Subtotal of cash flows from operating activities Payments for acquisition of investments: -1,100.2 bn operating 154.0 -66.5 Interest paid Acquisition of highly liquid listed shares using funds procured as part of the activities
Slide 20: Segment Income - SVF and Other SBIA-Managed Funds
Segment Income - SVF and Other SBIA-Managed Funds (JPY bn) P/L FY19Q1 FY20Q1 Items Gain on investments 414.4 296.6 Sale of a portion of shares in 4 listed portfolio companies and all of shares in 3 unlisted portfolio Realized gain on sales of investments ― 111.4 companies (includes share exchanges)
Slide 21: Appendix
Appendix
Slide 22: Breakdown of Goodwill / Intangible Assets
Breakdown of Goodwill / Intangible Assets (JPY bn) Change B/S As of As of Main items Outline item Mar 2020 Jun 2020 Changes in Amortization Others exchange rate 3,998.2 4,013.3 Goodwill Arm 2,554.1 2,562.1 - 8.0 - SBKK 907.5 907.5 - - - ZOZO 212.9 212.9 - - - Technologies 395.6 387.2 Arm 387.8 379.8
Slide 23: Business Results of PayPay and Treatment in Segment Information
Business Results of PayPay and Treatment in Segment Information (1) Consolidation of the results of PayPay FY18 FY19 FY20 SBKK: 50% May 15, 2019 SBG: 50% Shareholding ratio SBKK: 25% Yahoo Japan (currently Z Holdings): 50% Z Holdings: 25% SBG Subsidiary (Other segment) Subsidiary (Other segment) Rep
Slide 24: SoftBank
SoftBank
Slide 25: 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, Brightstar, PayPay, Fortress, SB Energy, etc.
Slide 26: Summary of FY2020 Q1
Summary of FY2020 Q1*1 Utilizing the strong portfolio, SBG achieved significant financial improvements and increased equity value of holdings. ⚫ Rapid execution of ¥4.3T asset monetization. Equity value of holdings marked at ¥27.4T - Alibaba:$14.7B monetization; its associate Ant Group announced an
Slide 27: Progress of ¥4.5T Program, Status of Assets, Financial Condition, Financial Strategy
- Progress of ¥4.5T Program - Status of Assets - Financial Condition - Financial Strategy Finance 3
Slide 28: SBG Share Price and Credit Spread
SBG Share Price and Credit Spread Both equity and credit markets favorably perceived the ¥4.5T Program. SBG share price*1 SBG CDS*2 (YTD) As of Aug 7 (bps) (YTD) 150 600 2.4 times from 544bps the bottom 137 (SBG) 125 123 (Nasdaq) 400 100 96 (Dow) As of Aug 7 90 (TOPIX) 242bps 200 75 ¥4.5T Program an
Slide 29: ¥4.5T Program
¥4.5T Program Large-scale returns to shareholders and creditors by asset monetization Asset sale and monetization up to ¥4.5T Preparing for future investment opportunities Returns to Financial New Shareholders Improvements Investments Share repurchase Debt repayment up to ¥2T Bond buyback (¥2.5T in
Slide 30: Progress of ¥4.5T Program
Progress of ¥4.5T Program Steady progress; the monetization is almost complete (95%). (¥ T) 0.2 • Taking full advantage of highly liquid assets 4.3 • Returns to shareholders and 1.2 Debt reduction debt reduction of bank loan and bonds to come 1.0 Returns to shareholders Monetization Executed returns
Slide 31: Asset Monetization (¥4.5T Program)
Asset Monetization (¥4.5T Program) ¥4.3T of successful asset monetization just in 4.5 months with the least market impact Prepaid forward Alibaba April to July contracts $14.7B $14.7B SBKK May Block trade ¥310.2B $2.9B*1 June to July Public offering etc. $18.1B T-Mobile July Margin loan $2.3B*2 $22.
Slide 32: Debt Reduction
Debt Reduction Reduced debt by ¥1.2T*1 in total while other companies accelerate debt finance US investment-grade issue volume ($ B) (accumulated) 1,600 Repurchase of domestic bonds in July 2020 2017 1,400 2016 Total repurchase ¥167.6B 1,200 2018 2019 amount (Face value) 1,000 800 600 Repayment of A
Slide 33: Repurchase of Domestic Bonds
Repurchase of Domestic Bonds Unprecedent large-scale repurchase of domestic retail bonds; tightened supply-demand balance improved bond yields. % SBG domestic bond yields*1 6.0 • The first program of repurchasing retail bonds in #57 6.1Y Japan (no tender offer mechanism in Japan) #56 6.2Y 5.0 #50 5.
Slide 34: Returns to Shareholders
Returns to Shareholders Share repurchase brings higher shareholder value per share; SBG share price recovered faster than other shares. Japanese large-cap companies Market cap trend (March 19, 2020 ~ July 31, 2020*2) Share repurchase (Market cap, ¥ T) Maximum amount of ¥2.5T #1 Toyota (20.3) repurch
Slide 35: Share Repurchase Program – Global Comparison
Share Repurchase Program – Global Comparison Executed a world-class large-scale returns to shareholders while improving the financial condition Top 10 large share repurchase programs announced in the U.S. and Japan since January 2020*1 # Issuer Announcement Repurchase period Repurchase amount 1 Appl
Slide 36: Share Repurchase Program – Domestic Comparison
Share Repurchase Program – Domestic Comparison Largest share repurchase programs announced in Japan since April 2010*1 Maximum repurchase # Issuer Date of authorization amount (¥ B) 1 SBG March – July 2020 2,500.0 2 JAPAN POST HOLDINGS October 19, 2015 731.0 3 TOSHIBA November 8, 2018 700.0 4 TOYOTA
Slide 37: Progress of ¥4.5T Program, Status of Assets, Financial Condition, Financial Strategy
- Progress of ¥4.5T Program - Status of Assets - Financial Condition - Financial Strategy Finance 13
Slide 38: Equity Value of Holdings
Equity Value of Holdings Excluding asset-backed Equity value of holdings marked at ¥27.4T even after finance a large-scale asset monetization (¥ T) 28.2 27.4 26.3 Composition 14.7 57％ 13.0 15.6 Alibaba 4.6 3.9 SBKK 14％ 3.8 2.7 SVF (interest of SBG) 3.1 2.7 10％ T-Mobile (formerly Sprint) 2.0 3.2 1.2
Slide 39: Price Trend of Listed Shareholdings (YTD)
Price Trend of Listed Shareholdings (YTD) Alibaba, T-Mobile, and SBKK shares successfully dealt with selling pressures caused by asset monetization; the prices are all solidly trending. 140 T-Mobile 140 130 130 120 120 Nasdaq 110 Alibaba 110 S&P500 100 100 SBKK 90 90 Nikkei 80 80 70 70 60 60 50 50 J
Slide 40: Stability and Growth Potential of Alibaba Shares
Stability and Growth Potential of Alibaba Shares Stable growth so far; deploying businesses that can demonstrate its strength in the post-COVID-19 period. Adjusted EBITDA ($ M) 22,266 E-commerce 18,170 16,866 Health care Entertain- ment 10,817 Post- 8,117 COVID-19 IT infra- Digital structure marketi
Slide 41: SVF1: Investment Highlights (SBG Consolidated basis)
SVF1: Investment Highlights (SBG Consolidated basis) (From SVF1 inception through June 30, 2020) SVF1 highlights are provided solely for illustrative purposes and individual investors' results may vary. Past performance is not necessarily indicative of future results. Investment market uplift includ
Slide 42: SVF1: Listed Shares Performance in the Secondary Market (YTD)
SVF1: Listed Shares Performance in the Secondary Market (YTD) 400% 300% Vir Biotechnology Ping An Good Doctor OneConnect Financial Technology 200% ZhongAn Online P&C Insurance 10x Genomics 100% Slack Technologies Nasdaq Guardant Health 0% Uber Technologies Dow Jones Industrial Average -100% Jan Feb
Slide 43: SVF1: Listed Portfolio Companies (as of August 10, 2020)
SVF1：Listed Portfolio Companies (as of August 10, 2020) Finance 19
Slide 44: SVF1: Investment Portfolio
SVF1: Investment Portfolio 9 listed companies Finance 20
Slide 45: Strength of SBG Investment Portfolio
Strength of SBG Investment Portfolio • Proportion of listed companies marks as high as 77% of the total value. • Portfolio companies are engaged in diversified businesses. Transportation & logistics Enterprise Health tech Proportion of listed companies (excl. the value related to asset-backed financ
Slide 46: Establishment of Investment Management Subsidiary
Establishment of Investment Management Subsidiary Finance 22
Slide 47: Progress of ¥4.5T Program, Status of Assets, Financial Condition, Financial Strategy
- Progress of ¥4.5T Program - Status of Assets - Financial Condition - Financial Strategy Finance 23
Slide 48: LTV
LTV Excluding asset-backed finance 14.2% 11.0% • Asset monetization and higher share prices of assets held improved LTV ratio by 3 pt • Thick financial buffer secured FY19Q4 FY20Q1 (May' 20) (Aug' 20) * LTV ratios presented are as of the date of the earnings results release of each quarter. Finance
Slide 49: Conservative Financial Management
Conservative Financial Management Excluding asset-backed finance 25% 17.2% 16.8% 16.1% Adhering to the 14.2% LTV-based financial 11.0% commitment for over 2 years FY19Q1 FY19Q2 FY19Q3 FY19Q4 FY20Q1 (Aug' 19) (Nov' 19) (Feb' 20) (May' 20) (Aug' 20) * LTV ratios presented are as of the date of the ear
Slide 50: Cash Position
Cash Position Maintain ample cash position, more than the bond redemptions for the next four years Cash position Bond redemption schedule (¥ B) ¥4.2T Repurchase of domestic bonds (-¥167.6B) Repayment of Alibaba margin loan (-$9.5B) Share repurchase (-¥398.3B） Finance using Alibaba shares (+$0.9B) Fi
Slide 51: SBG Standalone Interest-bearing Debt
SBG Standalone Interest-bearing Debt*1 Financial liabilities relating to prepaid forward contract (non-recourse to SBG) increased ¥1.7T due to monetization of Alibaba shares Main variance factors from the end of March 2020 (¥ B) Increase/decrease in bank loan and CP (-¥201.5B) Financial liabilities
Slide 52: SBG Standalone Cash Position
SBG Standalone Cash Position Significant increase following the monetization of equity holdings; a source for future returns to shareholders and bond holders Subsequent events to end of June 2020 (¥ B) Repurchase of domestic bonds (-¥167.6B) Repayment of Alibaba margin loan (-$9.5B) 4,159.0 Share re
Slide 53: SBG Standalone Net Interest-bearing Debt
SBG Standalone Net Interest-bearing Debt*1 Progress of the ¥4.5T Program led to significant financial Excluding asset-backed finance only for June 2020 reduction 6,461.8 Subsequent events (cash position): decrease ¥622.7B (¥ B) 6,212.4 6,228.0 Repayment of Alibaba margin loan (-$9.5B） Share repurcha
Slide 54: Redemption Schedule (after repurchase of domestic bonds)
Redemption Schedule (after repurchase of domestic bonds) Exploring various redemption options with refinancing as the main option (¥ B) 1,221.6 Domestic straight bonds Domestic subordinated bonds Domestic hybrid bonds 455.6 924.1 Foreign currency-denominated senor bonds 895.9 Foreign currency-denomi
Slide 55: Progress of ¥4.5T Program, Status of Assets, Financial Condition, Financial Strategy
- Progress of ¥4.5T Program - Status of Assets - Financial Condition - Financial Strategy Finance 31
Slide 56: 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 57: 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 58: Firmly Keeping Financial Policy (2/2): 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 59: Agile Financial Management in Response to the Market
Agile Financial Management in Response to the Market Achieving both shareholder return and financial improvement by implementing the ¥4.5T Program Appropriately control the balance between new investments and exits (prepare for future investment opportunities) Financial management focused on dialogu
Slide 60: Appendix
Appendix
Slide 61: 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 62: 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 63: LTV Calculation: SBG Standalone Net Debt
LTV Calculation: SBG Standalone Net Debt (L) Adjusted ¥3.02T SBG standalone net debt = 11.0% (V) SBG standalone ¥27.40T equity value of holdings (¥ T) Adjusted SBG Consolidated Net Debt at Self- Other Standalone Net Debt 3.02 = Net Debt 9.95 - financing Entities 4.31 - Adjustments 2.63 Repayment of
Slide 64: LTV Calculation: SBG Standalone Equity Value of Holdings
LTV Calculation: SBG Standalone Equity Value of Holdings (L) Adjusted ¥3.02T SBG Standalone Net Debt (V) SBG Standalone = 11.0% Equity Value of Holdings ¥27.40T (¥ T) SBG Standalone Investment Assets Holdings = Major Shares + Under SVF + Others 27.40 23.25 2.74 1.41 Alibaba shares +17.71 SBKK shares
Slide 65: SVF1: Capital Commitment
SVF1: Capital Commitment Capital commitment (as of the end of June 2020) ($ B) 98.6 (84.1) SBG 33.1 （8.0） 65.5 （28.4） （55.7） Third-party limited ※ Numbers in brackets represent amounts contributed. partners *1 SBG’s committed capital to SVF1 includes approximately $8.2 billion of an obligation satis
Slide 66: SVF1: Fair Value of Investment Assets
SVF1: Fair Value of Investment Assets (SBG Consolidated basis) ($ B) 82.2 79.8 77.6 75.2 74.6 75.0 70.7 69.6 71.5 66.3 Acquisition cost Fair value Jun' 19 Sep' 19 Dec' 19 Mar' 20 Jun' 20 *1 The presented acquisition cost and fair value of investment assets excludes exited investments. *2 Past perfor
Slide 67: SVF1: Listed Portfolio Companies (as of June 30, 2020)
SVF1: Listed Portfolio Companies (as of June 30, 2020) Finance 43
Slide 68: SVF1: Snapshot (as of June 30, 2020)
SVF1: Snapshot (as of June 30, 2020) To CM: タイトル部分を除いた社長プレゼンのみを張り 付けて、タイトルはこのプレゼンフォーマットに準じたも ので記載してください また注記のアラインメント（4行目）が変です。 Finance 44
Slide 69: Consolidated Interest-bearing Debt
Consolidated Interest-bearing Debt*1 (¥ B) Interest-bearing debt ＋ Lease liabilities 19,250.0 18,088.6 17,329.6 15,869.1 7,969.0 14,272.2 7,616.9 7,385.5 SBG standalone 307.1 Others (Arm, etc.) 283.5 721.3 9,803.6 283.6 8,281.3 127.4 624.3 SVF SoftBank segment 4,727.6 5,351.1 Sprint segment*2 4,635.
Slide 70: Consolidated Cash Position
Consolidated Cash Position*1 (¥ B) 5,918.7 4,005.9 4,159.0 SBG standalone 3,553.2 3,244.6 Others (Arm, etc.) SVF 2,724.2 2,093.9 1,741.0 SoftBank segment 1,819.5 Sprint segment*2 1,173.0 322.9 416.5 458.2 263.2 245.6 118.1 140.5 406.9 256.7 645.1 876.9 197.2 900.1 821.1 1,044.7 524.8 466.5 355.1 Jun
Slide 71: Consolidated Net Interest-bearing Debt
Consolidated Net Interest-bearing Debt*1 (¥ B) Interest-bearing debt 15,696.8 ＋Lease liabilities – Cash position 14,605.3 14,082.7 6,228.0 6,212.4 11,027.6 5,522.9 9,950.5 SBG standalone 580.8 20.4 378.7 Others (Arm, etc.) 9.4 6,461.8 5,644.6 SVF 4,451.0 3,990.9 3,850.7 SoftBank segment Sprint segme
Slide 72: SoftBank
SoftBank
Slide 73: SoftBank Vision Funds Update
QUARTER ENDED JUNE 30, 2020 SoftBank Vision Funds Update NAVNEET GOVIL Managing Partner & Chief Financial Officer SoftBank Investment Advisers
Slide 74: 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 75: 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 76: Topics
4 Topics 01- Progress & Highlights 02- Performance & Impact on SoftBank Group 03- In Focus: Accelerating Technological Shifts
Slide 77: Progress & Highlights
Progress & Highlights Investment Advisers
Slide 78: Update on SoftBank Vision Fund 2
PROGRESS & HIGHLIGHTS 6 Update on SoftBank Vision Fund 2 As of June 30, 2020 CURRENT PORTFOLIO 1 Acquisition Cost AMERICAS EMEA ASIA Digital pharmacy platform Communication monitoring Online optical marketplace system BEIKE Genomic diagnostics company Residential real estate platform Number of Inves
Slide 79: SVF1: Key Developments
PROGRESS & HIGHLIGHTS 7 SVF1: Key Developments Three-Month Period Ended June 30, 2020 Capital Invested 1 Follow-On Investments2 Fair Value Uplift3 Sale Proceeds4 Distributions5 Debt Repayment6 Footnotes: 1. Post the end of the Investment Period, SoftBank Vision Fund 1 is not permitted to invest in a
Slide 80: Performance Snapshot
8 SoftBank SoftBank Vision Fund 1 Group Total Commitment Total Commitment PROGRESS & HIGHLIGHTS $98.6B $28.1B Performance Acquisition Cost 1 SBG Paid-In Capital Snapshot $82.6B $24.1B 1 3 Cumulative Investment Gains SBG Total Value As of June 30, 2020 $3.5B $23.4B 2 2 Distributions SBG Distributions
Slide 81: SVF1: Portfolio Companies
PROGRESS & HIGHLIGHTS 9 SVF1: Portfolio Companies As of June 30, 2020 PRIVATE 4 Number of Investments1 Current Portfolio Companies2 PUBLIC Exits3 Footnotes: 1. Number of Investments includes investments in portfolio companies made by SoftBank Vision Fund 1 and joint-ventures with existing portfolio
Slide 82: SVF1: Portfolio Composition By Sector
PROGRESS & HIGHLIGHTS 10 SVF1: Portfolio Composition By Sector As of June 30, 2020 Transportation Real Estate Consumer Fintech Enterprise Health Tech Frontier Tech & Logistics 6% 19% 7% 42% 4% 6% 16% COST $9.9B $11.5B $4.9B $33.8B $2.2B $2.3B $10.9B FAIR VALUE $4.6B $13.7B $4.9B $30.6B $2.9B $4.5B $
Slide 83: SVF1: Measurable Value in Our Portfolio
PROGRESS & HIGHLIGHTS 11 SVF1: Measurable Value in Our Portfolio As of June 30, 2020 Realized Investments Unrealized Investments Gross Realized Gains1 Total Acquisition Cost1 Gross Unrealized Losses1,3 Total Fair Market Value1,3 $5.8B $75.5B ($2.3B) $73.2B Number of Portfolio Companies : 1,2 11 8 78
Slide 84: SVF1: 8 Public Listings Since Inception
PROGRESS & HIGHLIGHTS 12 SVF1: 8 Public Listings Since Inception As of June 30, 2020 NASDAQ: GH HKG: 1833 NYSE: WORK NASDAQ: TXG STOCK PRICE1 $81.13 $117.90 HKD $31.09 $89.31 GROSS 7.4x 2.1x 3.0x 10.5x MOIC2 NYSE: UBER NASDAQ: VIR HKG: 6060 NYSE: OCFT STOCK PRICE1 $31.08 $40.97 $38.35 HKD $18.26 GRO
Slide 85: SVF1: 9th Public Listing - Relay Therapeutics, Inc.
PROGRESS & HIGHLIGHTS 13 SVF1: 9th Public Listing - Relay Therapeutics, Inc. IPO Date: July 16, 2020 NASDAQ: RLAY 3 4 SVF1 - Cost Post-IPO Trading Activity AUG 10 IPO Price1 $20.00 +75% IPO – JUL 16 IPO Closing Share Price 2 $35.05 DEC 2018 2020 Footnotes: 1. IPO Price represents Relay Therapeutics,
Slide 86: SVF1: Valuations in Recent Funding Rounds
PROGRESS & HIGHLIGHTS 14 SVF1: Valuations in Recent Funding Rounds Pre-Money Valuations April 2020 $2.3B June 2020 $6.5B June 2020 $15.6B Series E Prior Round: $0.9B Series E Prior Round: $3.0B Series H Prior Round: $12.0B Footnote: Zuoyebang Pre-Money Valuation Source: Reuters article, “Chinese onl
Slide 87: SVF1: Distributions to Limited Partners
PROGRESS & HIGHLIGHTS 15 SVF1: Distributions to Limited Partners Since Inception to June 30, 2020 Total Distributions (A) (B) (C) (D) (E) = (B)-(C) Fund Drawn Return of Pref Coupon / 3 Outstanding 2 Commitment Capital 1 Capital Equity Gains 4 Capital 5 Preferred Equity $40.0B $34.0B $4.5B $3.5B $29.
Slide 88: SoftBank Vision Fund 1 Significant Dry Powder
16 SoftBank Vision Fund 1 1 Net Portfolio Value PROGRESS & HIGHLIGHTS Net Portfolio Value OVER TOTAL DEBT as of Jun 30, 2020 $73.2B Significant Dry Powder Liquid Assets to Invest Liquid Assets & and Dry Powder 2 as of Jun 30, 2020 $27.0B Dry Powder OVER TOTAL DEBT 3 Total Debt as of Jun 30, 2020 $1.
Slide 89: Performance & Impact on SoftBank Group (SBG)
17 Performance & Impact on SoftBank Group (SBG)
Slide 90: SVF1 Contribution to SBG, Net of 3rd Party Interests
18 SVF1 2019 2020 Three-Month Period Ended June 30 June 30 Fund Net Profit 2 $2.73 $2.35 PERFORMANCE & IMPACT ON SBG Less: Change in 3rd Party Contribution to Interests in Fund (1.35) (1.12) SBG, Net of 3rd SBG LP Income: 1.38 1.23 Share of Fund Net Profit Party Interests 1 SBG GP Income: Amounts in
Slide 91: SVF1 Contribution to SBG, Net of 3rd Party Interests (Inception)
19 SVF1 2020 Inception to June 30 Fund Net Loss 2 $(1.67) PERFORMANCE & IMPACT ON SBG Less: Change in 3rd Party Contribution to Interests in Fund 1.00 SBG, Net of 3rd SBG LP Loss: (0.67) Share of Fund Net Loss Party Interests 1 SBG GP Income: Amounts in USD billions 3 0.42 Management Fees & Performa
Slide 92: Contribution to SBG, Realized and Unrealized Values
20 Paid-In Capital PERFORMANCE & IMPACT ON SBG Contribution to SBG, Realized and Total Value Unrealized Values Net Asset Value1 (Unrealized Value): (SVF1) Distributions2 As of June 30, 2020 (Realized Value): Footnotes: 1. Net Asset Value includes net changes in fair value of financial assets at fair
Slide 93: In Focus: Accelerating Technological Shifts
21 In Focus: Accelerating Technological Shifts
Slide 94: Technological Shifts are Accelerating
ACCELERATING TECHNOLOGICAL SHIFTS 22 Technological Shifts are Accelerating An Illustrative Timeline SVF1 Launch MAY 2017 Artificial Intelligence & Big Data Mobile Connectivity Internet Revolution Computing Revolution 1980 1990 2000 2010 2020 2050+ The information herein is provided solely for illust
Slide 95: COVID-19 Impact on Industries
ACCELERATING TECHNOLOGICAL SHIFTS 23 COVID-19 Impact on Industries HIGH IMPACT1 LOW IMPACT1 MODERATE IMPACT1 (NEGATIVE) (POSTIVE) Retail Non- Real Estate Paper & Business & Healthcare Retail Defense Tech Airlines Automotive Hotels Essentials (REITs) Packaging Consumer Services (Med Products) Essenti
Slide 96: COVID-19 Impact on Industries
ACCELERATING TECHNOLOGICAL SHIFTS 24 COVID-19 Impact on Industries HIGH IMPACT1 LOW IMPACT1 MODERATE IMPACT1 (NEGATIVE) (POSITIVE) Retail Non- Real Estate Paper & Business & Healthcare Retail Defense Tech Airlines Automotive Hotels Essentials (REITs) Packaging Consumer Services (Med Products) Essent
Slide 97: Sectors Benefiting from Technological Shifts
25 ACCELERATING TECHNOLOGICAL SHIFTS Food Education Delivery Sectors Benefiting from Technological Healthcare SoftBank Entertainment Shifts Vision Fund 1 Enterprise E-Commerce Solutions Information herein reflects current beliefs of SBIA as of the date hereof and are based on a variety of assumption
Slide 98: E-Commerce
26 ACCELERATING TECHNOLOGICAL SHIFTS E-Commerce Online Retail Market Share In Korea4 GMV5 Unique Users5 U.S. E-Commerce Penetration1 27% 30% +11pp 4 Coupang Market Share 20% (Korea Online Retail) Of Rocket orders are delivered within 24hrs6 10% 16% 6% 10 years 10 Weeks Logistics & delivery hubs oper
Slide 99: Entertainment
27 ACCELERATING TECHNOLOGICAL SHIFTS Entertainment Babe TikTok / Douyin Helo Lark Toutiao Xigua Video 1 Top Apps Worldwide TikTok Year-over-Year Growth Zoom Facebook Whatsapp 2 3 4 TikTok TikTok Douyin Instagram App Downloads Monthly Active Users Avg Time Spent/User Google Meet 615M+ (1H 2020)2 480M
Slide 100: Enterprise Solutions
28 ACCELERATING TECHNOLOGICAL SHIFTS Enterprise Solutions PRE-COVID-19 27% Digital Collaboration Robotic Process Automation 5G, Network & Faster Processing Power Of Workforce Was Fully Remote1 COVID-19 58% Organizations using Slack Digital Workers Graviton2 Transitioned to Working Remotely1 incl. 65
Slide 101: Healthcare
29 ACCELERATING TECHNOLOGICAL SHIFTS Healthcare Tests to Clinical Tests to Biopharma Customers4 Customers4 “Exploring the feasibility of developing our own high throughput diagnostic test for COVID-19” Integrating leading-edge experimental and Accumulated Accumulated New Daily Consultations by New c
Slide 102: Education
30 ACCELERATING TECHNOLOGICAL SHIFTS Education $64B Student Traffic and Enrollment Main App MAU (mm) YoY Growth Most Used Online China EdTech Market1 Monthly Active Users4 Education App5 195M YoY Growth Online Education Users in China2 Monthly Active YoY Growth Users6 Full-Price Enrollments7 4x Apr
Slide 103: Food Delivery
ACCELERATING TECHNOLOGICAL SHIFTS 31 Food Delivery Dark Kitchens Food & Grocery Delivery Autonomous Delivery Kitchens U.S. Market Gross Bookings Increase in Demand for Contactless Deployed1 Share as of May3 Annual Run-Rate4 Delivery Services During Pandemic5 Monthly Gross Faster Than Industry YoY Gr
Slide 104: Sectors Benefiting from Technological Shifts
ACCELERATING TECHNOLOGICAL SHIFTS 32 Sectors Benefiting from Technological Shifts Enterprise Food Education Healthcare Entertainment E-Commerce Solutions Delivery Information herein reflects current beliefs of SBIA as of the date hereof and are based on a variety of assumptions and estimates that ar
Slide 105: Introducing Our Emerge Program
ACCELERATING TECHNOLOGICAL SHIFTS 33 Introducing Our Emerge Program Powering the Next Generation of Underrepresented Innovative Founders The information presented herein is provided for illustrative and informational purposes only and should not be relied upon in any way. The information provided he
Slide 106: Wrap-Up
34 Wrap-Up 01- Progress & Highlights 02- Performance & Impact on SoftBank Group 03- In Focus: Accelerating Technological Shifts
Slide 107: Thank You
Thank You == SoftBank Investment Advisers
Slide 108: SoftBank
SoftBank