Softbank Group Corp. · TSE:9984
Softbank — Q2 FY2019 Earnings Presentation
100 slides from Softbank's earnings presentation, Nov 8, 2019
Slide 1: Earnings Results for the Six-month Period Ended September 30, 2019
V1.1 Earnings Results for the Six-month Period Ended September 30, 2019 Investor Briefing November 8, 2019 SoftBank Group Corp.
Slide 2: Disclaimers
Disclaimers This presentation provides relevant information about SoftBank Group Corp. (“SBG”) and its subsidiaries and associates (together with SBG, “we,” “us” or the “Group”) and does not constitute or form any solicitation of investment including any offer to buy or subscribe for any securities
Slide 3: Exchange rates used for translation
Exchange rates used for translation FY2018 FY2019 Average during quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1 USD 108.71 111.55 112.83 110.46 110.00 107.70 1 GBP 147.54 145.84 144.48 143.99 140.88 132.73 1 CNY 16.97 16.40 16.31 16.37 16.13 15.37 EOQ Jun 30 Sep 30 Dec 31 Mar 31 Jun 30 Sep 30 Dec 31 Mar 31 1 USD
Slide 4: Index
Index Accounting Finance Consolidated Results P 2 Financial Highlights (FY2019 Q2) P 2 Change in Reportable Segments P 3 Equity Value of Holdings P 3 Loss of Investments in WeWork and Its Affiliates P 4 Net Debt and Equity Value of Holdings P 4 Accounting of Funding Commitment to WeWork P 5 LTV P 5
Slide 5: Accounting
Accounting 5
Slide 6: Consolidated Results
Consolidated Results FY18 FY19 (JPY bn) Q1-Q2 Q1-Q2 Change YoY Net sales 4,653.9 4,651.7 -2.2 -0.0% Operating income 1,420.7 -15.6 -1,436.3 - Net income (attributable to owners 840.1 421.6 -418.5 -49.8% of the parent) 26
Slide 7: Change in Reportable Segments
Change in Reportable Segments ・ Revised segment classifications after SoftBank Corp. made Yahoo Japan*1 a subsidiary. ・ The results of operations for FY18 are restated retroactively according to the new reportable segments. FY18 SoftBank Vision SoftBank Yahoo Japan Sprint Arm Brightstar Fund and Del
Slide 8: Loss of Investments in WeWork and Its Affiliates
Loss of Investments in WeWork and Its Affiliates ・Fair value of The We Company (“WeWork”)’s entire equity at end Q2: USD 7.8 bn*1 ・The USD 7.8 bn includes revised business plan after postponing public offering and agreement*2 under which SBG commits to provide Cumulative investment, fair value, loss
Slide 9: Accounting of Funding Commitment to WeWork
Accounting of Funding Commitment to WeWork WeWork to become an associate of SBG SBG and WeWork reached an agreement on October 22, 2019 (ET): SBG committed to provide significant funding to WeWork WeWork will be an associate of SBG SBG will not hold a majority of voting rights at any general sha
Slide 10: Sprint/T-Mobile Merger Status and Impact on Financial Results
Sprint/T-Mobile Merger Status and Impact on Financial Results Sprint/T-Mobile Merger Transaction Status Received approvals from DOJ/FCC and 18 of the state PUC →Outstanding: California PUC approval and the resolution of litigation filed by attorneys general of certain states and District of Columb
Slide 11: Consolidated P/L Summary (IFRSs)
Consolidated P/L Summary (IFRSs) (JPY bn) FY18 FY19 ・FY18Q1-Q2: Recognized gain relating to loss of control over P/L item Change Q1-Q2 Q1-Q2 subsidiaries of 176.3 bn as a result of Arm’s Chinese subsidiary Net sales 4,653.9 4,651.7 -2.2 becoming a JV. Operating income Operating income from SoftBank
Slide 12: Consolidated B/S Summary (IFRSs) - Assets
Consolidated B/S Summary (IFRSs) - 1 (JPY bn) B/S As of As of Main items Change item Mar 2019 Sep 2019 Decrease of 422.6 bn due to withholding tax refund on 7,758.0 7,447.8 -310.2 dividends paid in FY18 from SBGJ to SBG Current assets Cash and cash equivalents 3,858.5 4,259.2 +400.7 The variable pre
Slide 13: 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 2019 Sep 2019 8,681.7 7,456.4 -1,225.3 1 Impact of the adoption of IFRS 16 at the beginning of Interest-bearing debt 3,481.0 3,281.9 -199.1 FY19 1 892.5 bn of lease obligations previously included in 1 2 Current
Slide 14: Consolidated B/S Summary (IFRSs) - Equity
Consolidated B/S Summary (IFRSs) - 3 (JPY bn) B/S As of As of Items Change item Mar 2019 Sep 2019 9,009.2 8,623.6 -385.6 Common stock 238.8 238.8 - Due to a decrease in SBG’s economic interests in Yahoo Japan*1 Capital surplus 1,467.8 1,529.1 +61.3 1 Net income attributable to owners of the parent O
Slide 15: Consolidated C/F Summary (IFRSs)
Consolidated C/F Summary (IFRSs) FY19 (JPY bn) C/F item Q1-Q2 1,242.8 Subtotal of cash flows from operating activities C/F from -296.9 Interest paid operating 373.7 activities -1,040.1 Income taxes paid 440.6 Income taxes refunded Purchase of property, plant and equipment, and -636.0 intangible asse
Slide 16: Income and Loss Arising from SoftBank Vision Fund and Delta Fund
Income and Loss Arising from SoftBank Vision Fund and Delta Fund Included in P/L (JPY bn) FY18 FY19 P/L Items Q1-Q2 Q1-Q2 Gain and loss on investments at 649.4 -529.3 SoftBank Vision Fund and Delta Fund Realized gain and loss on sales of FY18Q2: Sale of investment in Flipkart shares 146.7 34.8 inves
Slide 17: Difference in Tax Rate
Difference in Tax Rate FY19Q1-Q2 Reconciliation between statutory tax rate and effective Tax Rate Amount Rate (%) (JPY bn) Income before income tax 1,116.9 Statutory income tax rate 31.5％ 351.4 (main factors of difference) - Impact from reassessment of the recoverability of 17.4% 193.8 deferred tax
Slide 18: Bridge of Disclosures between SBG Financial Report and SVF Update
Bridge of Disclosures between SBG Financial Report and “SoftBank Vision Fund & Delta Fund Update” section (USD bn) Committed capital, Total (p. 11） Committed capital, The Company (p. 11) SBG SVF Delta SVF Delta Financial Report 103.0 (= 98.6 + 4.4) 37.5 (= 33.1 + 4.4) Earmarked for use in an incenti
Slide 19: Bridge from Income before Income Tax of SVF and Delta Fund to SBG Contribution
Bridge from Income before Income Tax of SVF and Delta Fund Business to SVF’s Contribution to SBG FY18 FY19 Q1-Q2 Q1-Q2 SBG JPY bn 339.5 -399.5 Financial Income before income tax of SVF and Delta Report Fund Business （Contribution to SBG) USD bn 3.08 -3.75 (p.12) Income taxes on investment gains of S
Slide 20: Appendix
Appendix
Slide 21: SoftBank Corp. Made Yahoo Japan a Subsidiary
SoftBank Corp. Made Yahoo Japan a Subsidiary ・ On June 27, 2019, Yahoo Japan*1 issued 1,511 million new shares to SoftBank Corp. through a third-party allotment. ・ SBGJ, a wholly owned subsidiary of SBG, accepted a tender offer of share buyback by Yahoo Japan and sold its holdings of 1,793 million Y
Slide 22: Breakdown of Goodwill / Intangible Assets
Breakdown of Goodwill / Intangible Assets (JPY bn) B/S As of As of Change Main items Changes in Outline item Mar 2019 Sep 2019 Amortization Others exchange rate 4,321.5 4,083.3 Goodwill Arm 2,777.5 2,542.0 - -235.5 - SoftBank 907.5 907.5 - - - Sprint 326.8 317.8 - -9.0 - FCC licenses 4,155.1 4,041.2
Slide 23: Adoption of new standards: IFRS 16 - Leases
(Reference) Adoption of new standards: IFRS 16 - Leases Initial measurement for Right-of-use Assets and Lease Liabilities Lease Liabilities: Measured at the present value of total lease payments over the lease term Right-of-use Assets: Amount of the initial measurement of a lease liability plus any
Slide 24: Adoption of new standards: IFRS 16 - Leases
Adoption of new standards: IFRS 16 - Leases Primary change in accounting treatment: Classification of finance and operating leases has been eliminated and “right-of-use assets*1” and “lease liabilities” are recognized on a balance sheet for all leases. -Leases previously classified as operating leas
Slide 25: Adoption of new standards: IFRS 16 - Leases
Adoption of new standards: IFRS 16 - Leases Breakdown of right-of-use assets Opening B/S（April 1, 2019） (JPY bn) SoftBank Class of underlying assets Sprint Others Total Corp. Telecommunications equipment (wireless equipment, switching equipment and 1,079.0 21.9 117.5 1,216.6 other network equipment)
Slide 26: SoftBank Vision Fund - Gain/Loss on Investments Transferred from the Company
SoftBank Vision Fund - Gain/Loss on Investments Transferred from the Company in P/L Investments transferred from the Company other than “Bridge investments” shown below. Examples include investments that were made without the premise of offering to the SVF at the time of acquisition, or, investments
Slide 27: Differences in Figures of SoftBank Segment and SoftBank
Differences in Figures of Financial Results of the Company’s SoftBank Segment and SoftBank (1) Depreciation and amortization for non-current assets at SoftBank (formerly Vodafone K.K.) SBG’s consolidated financial statements SoftBank’s consolidated financial statements When Vodafone K.K.’s controlli
Slide 28: Settlement of Prepaid Forward Contract using Alibaba Shares
Settlement of Prepaid Forward Contract using Alibaba Shares At signing of contract 3 years total At settlement （June 2016） （June 2019） Derivative liabilities USD 6.8 bn Gain relating to settlement of variable prepaid forward contract Amortized Interest expense using Alibaba cost USD 0.3 bn shares De
Slide 29: Finance
Finance In this section, SoftBank Corp. is referred to as SBKK, SoftBank Vision Fund is referred to as SVF, and The We Company is referred to as WeWork. SBG standalone financial measures are calculated by excluding self-financing entities from consolidated group, unless otherwise stated. Self-financ
Slide 30: Financial Highlights (FY2019 Q2)
Financial Highlights (FY2019 Q2) • Completed settlement of DiDi sale to SVF (Cash position: +$6.4bn) • Issued JPY500bn of domestic senior bonds and redeemed JPY400bn of Financial domestic senior bonds in September position • Borrowed +$3.8bn through the margin loan backed by Alibaba shares • Announc
Slide 31: Equity Value of Holdings
Equity Value of Holdings Equity value of holdings exceeds JPY 27tn (JPY tn) +7.8% 27.9 25.8 13.3 11.3 Alibaba SBKK SVF (equity value for SBG) 4.7 4.8 Sprint Arm Others 3.5 3.2 2.9 3.1 2.6 2.7 0.9 0.8 FY19Q1 FY19Q2 * Share price and FX rate are as of the following dates: Aug. 7, 2019 (for FY19Q1) and
Slide 32: Net Debt and Equity Value of Holdings
Net Debt and Equity Value of Holdings Excl. Asset finance (JPY) Net debt 4.5tn Equity value SVF Others of holdings 12.4tn 4.8tn 3.1tn 3.2tn 2.7tn 0.8tn 26.9tn Listed Listed Listed * Listed share prices: (Japan) closing price as of Nov 6, 2019, (US) closing price as of Nov 5, 2019; FX rate USD 1 = JP
Slide 33: LTV
LTV Manage LTV at less than 25% during normal periods with upper threshold of 35% even during abnormal periods (JPY) 26.9 tn Excl. Asset finance （8.0） （8.0） LTV 16.8% (Debt coverage 5.9x) 4.5 tn Equity value of SBG standalone holdings net debt *1 Debt coverage = Equity value of holdings divided by n
Slide 34: SBG Standalone Interest-bearing Debt
SBG Standalone Interest-bearing Debt Funded in preparation for future bond redemptions (JPY bn) Main variance factors from June 30, 2019 Increase/decrease in bank loan and CP (−JPY251.0bn) 8,116.5 Issuance/redemption of domestic bonds (+JPY100bn) 7,616.9 7,411.9 7,385.5 Margin loan backed by Alibaba
Slide 35: SBG Standalone Cash Position
SBG Standalone Cash Position Increased due to settlement of DiDi sale to SVF, etc. (JPY bn) 2,158.8 Net proceeds expected from asset sale to SVF 2,102.4 (+$1.6bn) *unsettled +8.5 2,093.9 Exercised warrants of WeWork (−$1.5bn) *in Oct. 2019 1,642.4 8.5 1,281.7 Main variance factors from June 30, 2019
Slide 36: Maintaining Abundant Cash Position
Maintaining Abundant Cash Position Maintain a liquidity level that covers bond redemptions for at least the next 2 years Steady implementation of early refinancing (JPY bn) JPY 2.1tn*1 In addition to maintaining abundant cash Net proceeds expected position, secure various funding sources: from asset
Slide 37: SBG Standalone Net Interest-bearing Debt
SBG Standalone Net Interest-bearing Debt Decreased mainly due to change in cash position (JPY bn) Excl. Asset finance 6,834.8 6,212.4 5,522.9 Net proceeds expected from asset sale to 5,253.1 5,080.5 SVF: −$1.6bn 986.7 Exercised warrants of WeWork: +$1.5bn Adjustment on hybrid finance: −JPY 24.9bn Ad
Slide 38: Interest Expenses (standalone)
Interest Expenses (standalone*1) Interest payments are sufficiently covered (JPY bn) Avg. interest rate on standalone basis*2 : 2.32％ • Dividend income from Funded in JPY : 1.81％ subsidiaries 250.0 Funded in foreign currencies : 3.48% JPY 270.5bn*3 205.7 200.0 187.2 • Distribution from SVF (CY2018 a
Slide 39: Equity Value of Holdings
Equity Value of Holdings Equity value of holdings amounts to JPY 27.9tn (JPY tn) 27.3 27.9 25.8 25.4 Composition Ratio 20.1 13.1 13.3 48％ 11.3 12.1 Alibaba 11.3 SBKK 4.5 4.7 4.8 17％ SVF (equity value for SBG) 4.3 Sprint 3.2 3.5 3.2 11％ Arm 2.1 2.7 Yahoo Japan 2.4 2.7 2.8 2.9 3.1 11％ Others 2.8 2.7 1
Slide 40: Portfolio Diversification
Portfolio Diversification Value of Alibaba shares increased Portfolio composition Change from previous quarter (JPY tn) +2.07 Arm Others 10% 3% Sprint 11% Alibaba SVF 48% 11% +0.23 +0.10 +0.06 SBKK -0.14 17% -0.29 Alibaba SBKK SVF Sprint Arm Others * Share price and FX rate are as of the following d
Slide 41: Performance of Listed Stocks
Performance of Listed Stocks (Equity value held by SBG Group, % held by SBG Steady return on listed stocks Group (excl. treasury stock)) YTD Return (Jan. 4, 2019 = 100) (JPY 13.3tn, 26%） 140 • Expansion of New Retail strategy through taking Alibaba Sprint offline marketing online and strengthening c
Slide 42: SVF: Capital Commitment
SVF: Capital Commitment Investment period ended Capital Commitment (as of Sep. 30, 2019) (US$bn) 98.6 (71.6) SBG 33.1 （8.0） 65.5 （25.7） （45.9） Third-party Numbers in brackets represent limited partners amounts contributed *1 SBG’s committed capital to SoftBank Vision Fund includes approximately $8.2
Slide 43: SVF: Fair Value of Investment Assets
SVF: Fair Value of Investment Assets (US$bn) 82.2 ＋10％ ＋24％ 77.6 70.7 66.3 Fair value Acquisition cost Jun' 19 Sep' 19 *1 The presented acquisition cost and fair value of investment assets excludes exited investments. 15 43
Slide 44: WeWork
WeWork 16 44
Slide 45: Reduced Exercise Price of Existing Commitment: USD 1.5bn
Reduced Exercise Price of Existing Commitment: USD 1.5bn Valuation based on the price of warrant: post-money There can be no assurances that any plans described herein will be realized on the terms or timeline presented herein, and such plans are subject to uncertainties and risks. 17 45
Slide 46: Financing for WeWork
Financing for WeWork *1 Credit support details are currently under discussion between SBG and financial institutions *2 Warrants worth 17% economic ownership, calculated on a post-money TSM (treasury stock method) basis, assuming completion of all other transactions contemplated There can be no assu
Slide 47: Ownership of SBG
Ownership of SBG *1 Excludes the $3 billion tender offer at $19.19 per share but assumes completion of all other transactions contemplated *2 Economic ownership percentage calculated on a TSM (treasury stock method) basis There can be no assurances that any plans described herein will be realized on
Slide 48: Measures
Measures ① Pause contracting new offices ② Cost reduction ③ Sort out unprofitable business The information presented herein is provided for illustrative purposes only. Information herein reflect current beliefs of SBG as of the date hereof and is based on a variety of assumptions and This hypothetic
Slide 49: Our Policy on Portfolio Companies' Support
Our Policy on Portfolio Companies’ Support Portfolio company finances to be No rescue self-financing package 21 49
Slide 50: Financial Policy
Financial Policy 1. Manage LTV at less than 25% during “normal” periods (upper threshold of 35% even during “abnormal” periods) 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 22
Slide 51: FY2019 Finance Strategy
FY2019 Finance Strategy Pursue both financial stability and flexibility as an investment company Well-protected financial management to be invulnerable to any environmental change 1. Manage balance between investment asset value and debt size • Manage LTV at less than 25% with upper threshold of
Slide 52: Appendix
Appendix 52
Slide 53: Direction of Financial Management (illustrative)
Direction of Financial Management (illustrative) Maximize enterprise value by maintaining optimal leverage through LTV management LTV to improve in the long run as investment assets appreciate in value Balance elevated leverage Divestment during with improvement in financial bull market; position du
Slide 54: LTV Calculation: Adjusted SBG Standalone Net Debt
LTV Calculation: Adjusted SBG Standalone Net Debt (L) Adjusted JPY 4.54tn SBG Standalone Net Debt (V) SBG Standalone = 16.8% JPY 26.92tn Equity Value of Holdings (JPY tn) = - - Adjusted SBG Consolidated Net Debt at Self- Other Standalone Net Debt Net Debt Financing Entities Adjustments 4.54 14.08 8.
Slide 55: LTV Calculation: SBG Standalone Equity Value of Holdings
LTV Calculation: SBG Standalone Equity Value of Holdings (L) Adjusted JPY 4.54tn SBG Standalone Net Debt (V) SBG Standalone = 16.8% JPY 26.92tn Equity Value of Holdings (JPY tn) = + + - Investment SBG Standalone Major Shares Assets Under Other Shares Adjustment Holdings SVF 26.92 23.95 3.17 0.76 0.9
Slide 56: SoftBank Vision Fund 2
SoftBank Vision Fund 2 Total expected contribution of capital $108.0bn Expected contribution of capital by SBG $38.0bn * As of the July 26, 2019 press release announcement <Financial Policy> Manage LTV at less than 25% during normal periods (upper threshold of 35% even during abnormal periods) P
Slide 57: SBG Credit Rating Trend
SBG Credit Rating Trend Aim to improve credit rating evaluation under the investment holding company rating criteria 14 Acquisition of Acquisition of Sprint Arm SBKK Japan Telecom Vodafone KK Acquisition Acquisition Listing 13 A/A2 JCR (A－) 12 A－/A3 11 BBB+/Baa1 10 BBB/Baa2 S&P (BB＋) 9 BBB－/Baa3 Moo
Slide 58: Redemption Schedule
Redemption Schedule Planning various redemption options with refinancing as the main option Domestic straight notes (JPY bn) 1,305.6 Domestic subordinated notes Domestic hybrid notes Foreign currency-denominated senior notes 455.6 Foreign currency-denominated 947.0 924.1 hybrid notes 296.8 424.1 583
Slide 59: Consolidated Interest-bearing Debt
Consolidated Interest-bearing Debt Interest-bearing Debt ＋ (JPY bn) Lease Liabilities 17,987.8 18,088.6 17,329.6 SBG 17,053.8 Others (Arm, etc.) 15,685.1 SVF 7,616.9 Variable prepaid forward contract 8,116.5 7,385.5 (Alibaba) 7,411.9 6,722.9 SoftBank segment*3 283.5 Sprint segment 283.6 501.1 472.0
Slide 60: Consolidated Cash Position
Consolidated Cash Position (JPY bn) 5,125.8 4,005.9 2,158.8 3,629.1 3,338.8 SBG 2,724.2 2,093.9 1,281.7 547.9 1,642.4 Others (Arm, etc.) SVF 1,173.0 617.9 1,285.6 572.2 322.9 SoftBank segment*3 115.9 263.2 245.6 311.1 273.8 118.1 Sprint segment 376.1 358.3 645.1 876.9 1,012.3 757.4 782.4 524.8 466.5
Slide 61: Consolidated Net Interest-bearing Debt
Consolidated Net Interest-bearing Debt (JPY bn) Interest-bearing Debt ＋Lease Liabilities – Cash Position 14,648.9 14,605.3 14,082.7 11,927.9 12,056.0 6,834.8 6,212.4 5,522.9 SBG 5,253.1 5,080.5 Others (Arm, etc.) 9.4 378.7 SVF 520.0 Variable prepaid forward contract 741.7 727.8 730.6 (Alibaba) 3,990
Slide 62: SoftBank
SoftBank
Slide 63: SoftBank Vision Fund I & Delta Fund Update
1 SoftBank Vision Fund I & Delta Fund Update Navneet Govil Managing Partner & Chief Financial Officer, SoftBank Investment Advisers November 8, 2019 Confidential
Slide 64: Important Information (1 of 2)
Important Information (1 of 2) 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 65: Important Information (2 of 2)
Important Information (2 of 2) 3 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 66: Topics
4 Topics 1. Progress & Highlights 2. Performance & Impact on SoftBank Group 3. In Focus: Governance Confidential
Slide 67: Progress & Highlights
5 Progress & Highlights Confidential
Slide 68: WeWork Update
WeWork Update 6 Significant Vision Fund I Membership Growth1 Valuation2 timeline (Thousands) (USD Billions) 1 Sep 24th Adam Neumann steps down $33.1B as CEO of The We Company 527K $29.6B Independent Valuer Range 2 Sep 30th $27.2B S-1 Withdrawn. $9B Financing reduction = [$3B IPO + $6B Debt] 4X 74% 3
Slide 69: Key Developments - SoftBank Vision Fund I
Key Developments - SoftBank Vision Fund I 7 Three-month Period Ended September 30, 2019 End of Investment Investment Loss1 Recent IPOs2 Period -$8.8B Sep 12th Footnotes: 1. Investment Loss is before tax and expenses and based on valuations of unrealized investments. The valuations do not take into a
Slide 70: Key Developments - Delta Fund
Key Developments - Delta Fund 8 Three-month Period Ended September 30, 2019 Commitment Distribution1 Fund Status Transferred Out2 $5.0B $1.6B Inactive Footnotes: 1. Represents the distribution made to Limited Partners on July 22, 2019 in relation to the sale of Delta Fund’s holding in DiDi to the Vi
Slide 71: SoftBank Vision Fund I: Snapshot
SoftBank Vision Fund I: Snapshot 9 As of September 30, 2019 Cumulative $98.6B Acquisition Cost1 Investment Gains1 Distributions2 $76.3B $11.4B $9.9B SVF I SBG Paid-In Capital SBG Total Value3 SBG Distributions2 $28.1B $21.8B $26.3B $1.7B SBG Footnotes: 1. Include investments in Flipkart and Nvidia w
Slide 72: Delta Fund: Snapshot
Delta Fund: Snapshot 10 As of September 30, 2019 Cumulative $4.4B Acquisition Cost1 Investment Gains1 Distributions2 $5.0B $0.0B $5.1B Delta SBG Paid-In Capital SBG Total Value3 SBG Distributions2 $4.4B $3.8B $3.5B $3.5B SBG Footnotes: 1. Include solely the investment in DiDi which was transferred t
Slide 73: Growth of Our Portfolio
Growth of Our Portfolio 11 Number of Investments1,2 90 Cumulative $11.4B Investment Gains1 Number of Investments1,2 Acquisition 40 Cost1,2 $76.3B Cumulative Investment Gains1 $8.3B Acquisition Cost1,2 $34.3B Sep 30, 2018 Sep 30, 2019 Footnotes: 1. Acquisition Cost, Number of Investments, and Cumulat
Slide 74: Growing Portfolio of Market Leaders
Growing Portfolio of Market Leaders 12 As of September 30, 2019 Investments included herein were held by the Vision Fund I as of September 30, 2019. The investments presented herein are solely for illustrative purposes, have been selected in order to demonstrate examples of Fund investments, and do
Slide 75: Portfolio Composition By Sector
Portfolio Composition By Sector 13 As of September 30, 2019 40% 10% Cost $31.4B Cost $9.0B Information herein is presented on an Fair Value $31.1B Fair Value $7.5B aggregated basis across the Vision Fund I and Delta Fund and does not include Flipkart and Nvidia which were exited in August 2018 and J
Slide 76: Portfolio Composition By Geography
Portfolio Composition By Geography 14 As of September 30, 2019 Health Tech Real Estate Transportation & Logistics Fintech Frontier Tech Enterprise AMERICAS 40% Consumer Information herein is presented on an aggregated basis across the Vision Fund I and Delta Fund and does not include Flipkart and Nv
Slide 77: Portfolio Composition By Geography
Portfolio Composition By Geography 15 As of September 30, 2019 Consumer Frontier Tech Real Estate Transportation & Logistics Fintech EMEA 14% Health Tech Consumer Fintech Transportation & Logistics ASIA 46% Enterprise Real Estate Information herein is presented on an aggregated basis across the Visi
Slide 78: Public Listings Since Inception
7 Public Listings Since Inception 16 Inception to Jun 2019 Jul – Sep 2019 Post Sep 2019 Gross MOIC1: 6.2X Gross MOIC1: 1.8X Footnotes: 1. Gross MOIC (Multiple of Invested Capital) presented includes valuation uplifts that reflect unrealized estimated amounts, does not take into account taxes or expe
Slide 79: Performance & Impact on SoftBank Group
17 Performance & Impact on SoftBank Group Confidential
Slide 80: Contribution to SBG, Net of 3rd Party Interests
Contribution to SBG, Net of 3rd Party Interests 18 Amounts in USD Billions Six-month Period Six-month Period ended ended September 30, 2018 September 30, 2019 SVF I & Delta SVF I & Delta Fund Net Profit (Loss)1 $2.86 -$4.90 Less: Change in 3rd Party Interests in Funds -1.74 2.49 SBG LP Income: Share
Slide 81: Contribution to SBG, Net of 3rd Party Interests
Contribution to SBG, Net of 3rd Party Interests 19 Amounts in USD Billions Period from Fund Inception to September 30, 2019 SVF I & Delta Fund Net Profit1 $5.76 Less: Change in 3rd Party Interests in Funds -3.12 SBG LP Income: Share of Fund Net Profit $2.64 SBG Manager Income: Management & Performan
Slide 82: Contribution to SBG, Realized and Unrealized Values
Contribution to SBG, Realized and Unrealized Values 20 As of September 30, 2019 $29.8B $1.5B Manager Undistributed & Accrued Performance Fee3 $28.3B $25.6B LP Total Value = NAV1 (Unrealized Value) + Distributions (Realized Value) Paid-In Capital Total Value2 Footnotes: 1. Net Asset Value includes ne
Slide 83: In Focus: Governance
21 In Focus: Governance Confidential
Slide 84: Why The Focus on Governance
Why The Focus on Governance 22 Our three objectives Fiduciary duty to Limited Partners, including SBG Compliance with Laws & Regulations in multiple jurisdictions we operate in Going beyond minimal requirements by aligning with industry best practices Footnotes: There can be no assurance that the op
Slide 85: SBIA – A Global Organization
SBIA – A Global Organization 23 LONDON SILICON VALLEY TOKYO RIYADH MUMBAI SHANGHAI ABU DHABI HONG KONG SINGAPORE 480+ Employees 150+ Investment Professionals 330 Functional Approximate headcount as of September 30, 2019. Small number of executives in Miami, New York, Chicago and Massachusetts not in
Slide 86: Subject to Global Financial Services Regulatory Bodies
Subject to Global Financial Services Regulatory Bodies 24 5 Regulatory Bodies Singapore recently received its capital markets license from the Monetary Authority of Singapore. Mumbai, India has recently received approval from the India Department of Economic Affairs to undertake certain investment a
Slide 87: SBIA Governance: Three Areas of Focus
SBIA Governance: Three Areas of Focus 25 Vision Fund I Governance 3 Key Areas of Focus Investment Manager Portfolio Company Governance Governance Footnotes: There can be no assurance that the operations and/or processes of SBIA and the Vision Fund I described in this Presentation will continue throu
Slide 88: SBIA Governance Framework
SBIA Governance Framework 26 Five facets of governance framework Policies & Legal & Regulatory Standards Compliance 1 2 GOVERNANCE FRAMEWORK Risk & Performance 5 3 Board of Directors Management & Committees 4 Accountability & Transparency Footnotes: There can be no assurance that the operations and/
Slide 89: Vision Fund I Governance
Vision Fund I Governance 27 The three layers of governance: Investment Manager, General Partner, and Limited Partners The Investment Manager’s Board of Directors GP Board of Directors & Investor Advisory Board oversees the Fund’s activities & monitors compliance provide additional layers of governan
Slide 90: Investment Manager Governance
Investment Manager Governance 28 Board of Internal Internal Directors Compliance Compliance Audit Audit Investment Manager Committees Operating Conduct Committee Committee Regional & Global Data Protection New Product Weekly Deal Calls New Activities Operations Committee Committee Committee Footnote
Slide 91: SBIA Senior Leadership Regulatory Accountability
SBIA Senior Leadership Regulatory Accountability 29 The Senior Managers Certification Regime (SMCR)1 outlines accountability and underscores compliance and governance as core components of our culture MANAGEMENT Senior Managers Regime CONDUCT SENIOR RULES Board Executive Member Other Senior Managers
Slide 92: Accountable for Key Controls
Accountable for Key Controls 30 The Japanese Financial Instruments and Exchange Act regulation (J-SOX) requires the review and testing of key controls annually Company Level Controls1 (“CLC”) SVF I and SBIA governance related internal controls 42 “CLC” Financial Reporting Controls1 Business Process
Slide 93: SBIA GIPS Compliance – Increased Transparency to Limited Partners
SBIA GIPS Compliance – Increased Transparency 31 to Limited Partners Independently Verified, SBIA Entity-wide Adoption of the Global Investment Performance Standards GIPS® 2020 Increased transparency to Limited Partners Comparability of performance metrics Consistent approach to presentation Strengt
Slide 94: Thank You
Thank You == SoftBank Investment Avisers
Slide 95: Appendix
Appendix == SoftBank Investment Advisers
Slide 96: Contribution to SBG, Net of 3rd Party Interests
Contribution to SBG, Net of 3rd Party Interests 34 Amounts in USD Billions Six-month Period Six-month Period ended ended September 30, 2018 September 30, 2019 SVF I Delta Total SVF I Delta Total Fund Net Profit (Loss)1 $ 2.90 -$ 0.04 $ 2.86 -$ 4.87 -$ 0.03 -$ 4.90 Less: Change in 3rd Party Interests
Slide 97: Contribution to SBG, Net of 3rd Party Interests
Contribution to SBG, Net of 3rd Party Interests 35 Amounts in USD Billions Period from Fund Inception to September 30, 2019 SVF I Delta Total Fund Net Profit (Loss)1 $5.93 -$ 0.17 $5.76 Less: Change in 3rd Party Interests in Funds -3.05 -0.07 -3.12 SBG LP Income: Share of Fund Net Profit (Loss) $ 2.
Slide 98: SoftBank Vision Fund I: Contribution to SBG, Realized & Unrealized Values
SoftBank Vision Fund I: Contribution to SBG, Realized & 36 Unrealized Values As of September 30, 2019 $26.3B $1.5B Manager Undistributed & Accrued Performance Fee3 $24.8B $21.8B LP Total Value = NAV1 (Unrealized Value) + Distributions (Realized Value) Paid-In Capital Total Value2 Footnotes: 1. Net A
Slide 99: Delta Fund: Contribution to SBG, Realized & Unrealized Values
Delta Fund: Contribution to SBG, Realized & Unrealized Values 37 As of September 30, 2019 $3.8B $3.5B LP Total Value = Distributions (Realized Value) Paid-In Capital Total Value1 Footnotes: 1. Total Value reflects SBG’s Limited Partner interest in the Fund. As of September 30, 2019, the Delta Fund h
Slide 100: SoftBank
SoftBank