Nomura Holdings, Inc. · TSE:8604
Nomura — Q2 FY2022/23 Earnings Presentation
34 slides from Nomura's earnings presentation, November 2022
Slide 1: Consolidated Results of Operations, Second quarter, year ending March 2023
__.NOMURA Consolidated Results of Operations Second quarter, year ending March 2023 (US GAAP) Nomura Holdings, Inc. November 2022 Nomura
Slide 2: Presentation and Financial Supplement contents
Presentation Financial Supplement © Executive summary (p. 2-3) © Consolidated balance sheet (p. 17) © Overview of results (p. 4) © Value at risk (p. 18) Business segment results (p. 5) © Consolidated financial highlights (p. 19) © Retail (p. 6-8) © Consolidated income (p. 20) © Investment Management
Slide 3: CFO overview of first half results
Good evening, this is Takumi Kitamura, CFO of Nomura Holdings. I will now give you an overview of our financial results for the second quarter and first half of the fiscal year ending March 2023 using the document titled Consolidated Results of Operations. Please turn to page two. Net revenue for th
Slide 4: Second quarter net revenue and income
Net revenue was 318 billion yen, up 6 percent. Income before income taxes was 31.5 billion yen and net income was 16.8 billion yen, both representing improvements from last quarter. While the market uncertainty had an impact, this performance is far from satisfactory. EPS was 5.41 yen and ROE was 2.
Slide 5: Highlights
Highlights
Slide 6: Net revenue and income (loss) before income taxes
Net revenue and income (loss) before income taxes (bilions of yen) | FY2021/22 -FY2022/23 _Fy2122 —FY2223 20 22 4a__} _10 200} Dov ver) Lou a] = Net revenue 85.2 87.4 705 14 725 | 2% 15% | 1702 | 1439 | -15% Invest mentManagement 34.3 40.4 10.41 76 26.2 } 35x 24% 78 338 | -65% 1727 = 202T_— 1949 | 1
Slide 7: Retail results
Net revenue increased 2 percent to 72.5 billion yen, while income before income taxes grew 12 percent to 5.5 billion yen. As shown on the bottom left, recurring revenue was 33.9 billion yen, up 5 percent on ongoing net inflows of recurring revenue assets driven by discretionary investments and loans
Slide 8: Retail sales by product
Total sales slipped 2 percent in the quarter to 4.6 trillion yen. For investment trusts, the donation scheme of the ESG fund Nomura Sustainable Select launched in July gained support spreading across Japan. While global equity funds also saw inflows, total sales of investment trusts declined 16 perc
Slide 9: Retail KPIs and recurring revenue assets
Net inflows of recurring revenue assets shown on the top left as 127.9 billion yen. As you can see on the top right, recurring revenue assets at the end of September had dropped to 18.3 trillion yen, but the quarterly average actually increased and recurring revenue remained resilient after bottomin
Slide 10: Investment Management results
Net revenue was 26.2 billion yen and income before income taxes was 5.6 billion yen, both improving from last quarter. Investment gain/loss, which has had a significant impact on performance over the past two quarters, improved to negative 3.7 billion yen as ACI related loss narrowed and unrealized
Slide 11: Assets under management and net inflows
As shown on the top left, assets under management at the end of September were 64.8 trillion yen, down by 800 billion yen from end of June due mainly to market factors. Average AuM for July to September remained high at 66.2 trillion yen. Net inflows shown on the bottom left was 140 billion yen for
Slide 12: Wholesale results
Net revenue increased 3 percent to 205.5 billion yen. Fixed Income had a good quarter driven by Macro Products, Investment Banking performance improved and the weaker yen also contributed. Expenses increased to 185.3 billion yen. While we were able to contain variable costs such as pay for performan
Slide 13: Global Markets net revenue
Global Markets net revenue was roughly unchanged from last quarter at 177.5 billion yen. Fixed Income net revenue increased 3 percent to 115.6 billion yen. Macro Products had another good quarter with AEJ FX/EM posting its strongest quarterly revenues in six and a half years. Spread Products saw a s
Slide 14: Investment Banking
Net revenue increased 18 percent to 28 billion yen. Sustainability-related and cross-border transactions contributed to the Advisory business which delivered stronger revenues in Japan, EMEA and AEJ. We worked on multiple private placement transactions such as for GRIDSERVE Sustainable Energy shown
Slide 15: Non-interest expenses
Groupwide non-interest expenses were roughly flat at 286.5 billion yen. Overall costs were up due to yen depreciation, while Other expenses declined by 26 percent due to lower legal expenses. Page 15 gives you an overview of our financial position. 14
Slide 16: Robust financial position and closing
As shown on the bottom left, our Tier 1 capital was 3.3 trillion yen, an increase of over 80 billion yen from the end of June driven mainly by an increase in FX translation adjustment due to the weaker yen. Risk-weighted assets increased by 300 billion yen from the end of June to 17.2 trillion yen.
Slide 17: Financial Supplement
Financial Supplement 16
Slide 18: Consolidated balance sheet
Consolidated balance sheet (tillions of yen) Assets Total cash and cash deposits Total loans and receivables Total collateralized agreements Total trading assets and private equity and debt investments’ Total other assets Total assets 1. Inching secunties pledged as colteral Total NHI shareholders’
Slide 19: Value at risk
= Definition — 95% confidence level = 1-day time horizon for outstanding portfolio — Inter-product price fluctuations considered = FromApril 1, 2022, to September 30, 2022 (billions of yen) — Maximum: 6.3 - Minimum: = 2.7 — Average: 41 (billions of yen) Equity Interest rate 33 23 24 23 23 48 31 Fore
Slide 20: Consolidated financial highlights
Full year (billions of yen) 200 153.4 "= Net income (loss) 150 57% 143.0 attributable to Nomura 4 Holdings, Inc. CNHI) shareholders 100 ROE (%) so o Net revenue 1,401.9 1,363.9 318.9 351.0 340.8 299.0 318.0 Income (loss) before income taxes 230.7 226.6 185 80.1 495 W7 31.5 Net income (loss) attribut
Slide 21: Consolidated income
Full year Quarter (ners ive) rms ram ggg Revenue Commissions 376.9 332.3 916 82.6 75.2 704 68.2 Fees from investment banking 108.7 149.6 33.9 46.0 34.0 273 24.2 Asset management and portfolio service fees 230.0 270.0 67.2 69.9 68.9 68.3 69.0 Net gain on trading 310.0 368.8 911 106.8 118.9 1419 160.9
Slide 22: Main revenue items
Full year 150.2 1714.4 42.0 44.0 444 437 43.2 63.2 79.6 204 208 195 19.0 19.6 16.6 19.4 48 5.0 49 56 62 230.0 270.0 67.2 69.9 68.9 68.3 69.0 21 21
Slide 23: Income (loss) before income taxes by segment and region
Adjustment of consolidated results and segment results: Income (loss) before income taxes’ Full year Quarter — come ae Retail 92.3 59.2 17.0 18.0 52 49 55 91.0 715 15.0 204 28 AT 56 Wholesale 643 745 25.0 40.8 37.0 25.3 20.2 Three busi total 2476 205.2 57.0 79.2 335 185 M2 Other 285 158 40.4 17 14.9
Slide 24: Segment Other
Income (loss) before incometaxes* Full year Quarter (billions of yen) 80 40 15.8 149 ° 47 24 39 28.5 40 404 80 Net gain (loss) related to economic 5 99 38 Aa 84 98 O41 Realized gain (loss) on investments in equity “ta held for operate 7 14 00 0.0 14 02 O41 Equity in earings of affiliates 164 36.8 56
Slide 25: Retail related data
Full year Quarter (billions of yen) nm ‘Prema Fraie m@ 9M 4 10 Commissions 187.7 138.5 Et) 365 278 26.0 262 am 2. ___Of which, stock brokerage commission 926 674 176 176 144 118 122 35% 30a _—Of which, commissions for distribution of investment trusts 64 435 114 116 65 75 64 AAG ADA ‘Sales credit 84
Slide 26: Retail client assets
Retail clientassets {trillions of yen) = Other y 124 — : ek 119401177 romana 3 tusts = Bond investment ] trusts a = Stock investment tusts = Domestic bonds o 88 ees 8 1. Including CBs and warrants, 2 Including annutty surance. aa 25
Slide 27: Net inflows of cash and securities
Net inflows of cash and securities’ Full year Quarter ‘= Corporates mindividuals =Corporates mindividuals 4,500 1,500 1,200 1,200 900 900 600 600 300 300 _| : : : -300 -300 -600 -600 -900 -900 1,200 -1,200 meet Spectre tenons otra oS Corporates? 1,205 136 Corporates? 27 1,089 722 125 267 Individuals
Slide 28: Number of accounts
Number of accounts (ousands) —Fraozoet Fyzozva2 vane rv20RG Accounts with balance 5,329 5,348 5,342 5,362 5,348 5,354 5,359 Equity holding accounts 2,927 2,955 2,923 2,949 2,955 2,958 2,957 NISA accounts opened (accumulated)' 1,791 1,589 1,828 1,839 1,589 1,598 1,609 Online service accounts 4,895 5,
Slide 29: Investment Management results and AuM
Full year Quarter le “Prayer rez ee ee ee ee ee Buniness reremae 1119 1199 293 315 34 07 239 25% 2% Investment gaintoss 512 281 51 86 24 21 37 : : Net revenue 163.2 148.0 M3 404 10.1 76 2 3K 23.8% Non-inferest expenses 24 765 193 198 189 193 2s 63% 6a Income (oss) before income taxes 210 15 160 204
Slide 30: Asset inflows/outflows by business
Asset inflows/outflows by business*: 2 Full year Quarter ce ms pa i °° a - e Investment trusts business 2,753 12% 267 250 372 478 137 ofwhich ETFs 2.241 683 -28 -15 383 323 s investment advisory and international r r bush 883 830 772 110 180 928 83 Total net asset inflow 1,870 2,066 1,039 360 193 ~4
Slide 31: Wholesale results and revenue breakdown
Full year Quarter (billions of yen) nee Se rane Prana 20 QQ Net revenue 691.4 703.1 172.7 202.7 194.9 199.0 205.5 3.3% 19.0% Non-interest expenses 627.1 628.6 147.7 161.9 157.9 173.7 185.3 6.7% 25.5% Income (loss) before income taxes. 643 74.5 25.0 408 370 253 20.2 20.1% 19.1% Breakdown of Wholesale
Slide 32: Number of employees
Japan 15,330 15,213 15,393 15,299 15,213 15,503 15,384 Europe 2,769 2,820 2,811 2.817 2,820 2.811 2,869 Americas 2,152 2,257 2471 2,181 2,257 2,252 2,358 Asia and Oceania’ 6,151 6.295 6.216 6,259 6,295 6,407 6,520 Total 26,402 26,585 26,591 26,556 26,585 26,973 27,131 1. Includes Powai office n indi
Slide 33: Disclaimer
This document is produced by Nomura Holdings, Inc. (“Nomura”). Nothing in this document shall be considered as an offer to sell or solicitation of an offer to buy any security, commodity or other instrument, including securities issued by Nomura or any affiliate thereof. Offers to sell, sales, solic
Slide 34: Nomura Holdings, Inc.
Nomura Holdings, Inc. www.nomura.com