Nomura Holdings, Inc. · TSE:8604
Nomura — Q1 FY2021/22 Earnings Presentation
33 slides from Nomura's earnings presentation, July 2021
Slide 1: CFO overview of first quarter results
Good evening, this is Takumi Kitamura, CFO of Nomura Holdings. I will now give you an overview of our financial results for the first quarter of the fiscal year ending March 2022 using the document titled Consolidated Results of Operations. Please turn to page two. Net revenue increased 108 percent
Slide 2: Presentation and Financial Supplement contents
Presentation Financial Supplement © Executive summary (p. 2) © Overview of results (p. 3) © Business segment results (p. 4) © Retail (p. 5-6) © Investment Management (p. 7-8) © Wholesale (p. 9-11) © Non-interest expenses (p. 12) © Robust financial position (p. 13) © Funding and liquidity (p. 14) © C
Slide 3: FY2021/22 1Q highlights
FY2021/22 1Q highlights Income (loss) before income taxes and net income (loss)' = Income before income taxes: Y78.5bn; Net income’: Y48.5bn; ROE?: 7.1 ; EPS: Y15.59 - Three segment income (loss) before income taxes recovered from last quarter; Investment Management had a strong quarter; Although Wh
Slide 4: Highlights
Highlights (billions of yen, except EPS and ROE) 460.7 -23% 278.9 2% 181.8 57% 142.5 66% ‘Y45.65 66% 21.0% 3 Diluted netincome oss atvibuabe to Nomura Hadrgssharehides per sare,
Slide 5: Net revenue and income (loss) before income taxes
Net revenue and income (loss) before income taxes’ (ciions of yen) Fy2021/22 Fy2020/21 Fy202021 39.6 66.2 54.4 34 46 23 Income (loss) before income taxes il 78.5 166.1 [ - [ 181.8 57% *Additional information on “Other” (1Q) | Realized gain on partial sale of stake in the affiliate company, Nomura Re
Slide 6: Retail first quarter results
Retail first quarter net revenue declined 12 percent to 85 billion yen, while income before income taxes down 27 percent to 19 billion yen. Retail clients remained on the sidelines due to another wave of the pandemic and a slump in equity markets in early May, pushing down sales of stocks and invest
Slide 7: Retail investment trust inflows and recurring revenue
The top right of page 6 shows investment trust net inflows of 89.2 billion yen, representing another quarter of net purchases. Discretionary investments had been trending down for a while, but that started bottoming out in November last year when we introduced CIO services and this quarter we report
Slide 8: Investment Management results
As you may know, we dissolved the Asset Management and Merchant Banking divisions and created the new Investment Management division on April 1. The graph on the top left here shows a reclassification of past figures under the new disclosure format to make it easier for comparisons. Business revenue
Slide 9: Investment Management inflows and alternative assets
The graph on the top left shows inflows into our investment trust business and the investment advisory and international business, giving total inflows of 474 billion yen. A breakdown for the investment trust business is shown on the bottom left. Core investment trust flows, which exclude ETFs and M
Slide 10: Wholesale results
As shown on the top left, net revenue was 132.8 billion yen and loss before income taxes was 28.4 billion yen. As I said earlier, performance was significantly impacted by an additional loss of 65.4 billion yen arising from transactions with a US client. Of this, 56.1 billion yen was booked as a tra
Slide 11: Global Markets net revenue
Global Markets net revenue improved from last quarter to 97.2 billion yen, declining 8 percent excluding the trading loss related to transactions with a US client. Cash Equities and Derivatives both slowed due to a drop in volatility and lower trading volumes. As the heat map on the top right shows,
Slide 12: Investment Banking net revenue
Net revenue was 35.5 billion yen, marking the third strong quarter with revenues over 35 billion yen. M&A had another strong quarter and we supported multiple cross-border and sustainability-related deals driven by Nomura Greentech. ECM and DCM revenues also increased. Key deals are shown on the rig
Slide 13: Non-interest expenses
Total non-interest expenses declined 18 percent to 274.7 billion yen. Other expenses dropped by about 90 billion yen to 48.2 billion yen as loan loss provisions related to a US client transactions declined by 32 billion yen and the 47.7 billion yen impairment charge on an affiliate booked last quart
Slide 14: Robust financial position
The table on the bottom left show Tier 1 capital at 3 trillion yen, up 150 billion yen from the end of March due mainly to higher retained earnings and the issuance of Additional Tier 1 bonds. Risk-weighted assets declined 1.2 trillion yen from the end of March to 14.7 trillion yen as market risk de
Slide 15: Conclusion
To conclude, this quarter saw a number of positives despite slowing from the year ended March 2021. Investment Management newly established in April plays a key role on our strategy to expand into private markets and this quarter a private equity investee company listed and we saw a strong contribut
Slide 16: Financial Supplement
Financial Supplement 15
Slide 17: Consolidated balance sheet
Consolidated balance sheet (billions of yen) Total assets 1. Including securities pledged as collateral 16
Slide 18: Value at risk
= Definition = From April 1, 2021, to June 30, 2021 (billions of yen) — 99% confidence level — Maximum: 89.7 — 1-day time horizon for outstanding portfolio — Minimum: 4.8 — Inter-product price fluctuations considered — Average: 16.1 (billions of yen) Equity Interest rate 2.4 86 17.0 12.0 85 86 3.8 F
Slide 19: Consolidated financial highlights
1. Full year (billions of yen) 300 5 sme Net income (loss) aT om attributable to Nomura Holdings, Inc. CNHI") shareholders —e— ROE(%) 400 -200 Quarter (billions of yen) 200 5 4 1.0% 15.6% 142.5, 1% 98. 676 a & 155.4 Netrevenue 1.2878 14019 460.7 3690 4021 1700 353.3 Income (loss) before income taxes
Slide 20: Consolidated income
Quarter Full year “on Pramas prem ggg Revenue Commissions 308.8 376.9 855 923 967 1024 82.9 Fees from investment banking 103.2 108.7 108 27.0 36.1 347 7 Asset management and portfolio service fees 238.2 230.0 537 574 586 603 64.0 Net gain on trading 356.6 310.0 139.1 1315 136.4 96.9 62.0 Gain (Joss)
Slide 21: Main revenue items
Full year Quarter 196.5 2623 29 61.0 65 728 58.2 144 143 43 29 34 36 37 67 688 144 193 18.1 17.4 44 HN2 36 42 91 96 86 66 308.8 3769 855 923 67 102.4 82.9 Equity underwriting and distribution 140 306 15 10.5 10.4 82 10.0 Bond underwriting and distributon 35 23.1 33 57 64 WwW 73 M&A / Financial advis
Slide 22: Income (loss) before income taxes by segment and region
Adjustment of consolidated results and segment results: Income (loss) before income taxes' Full year Quarter a =| Retail 49.4 92.3 15.1 28 28.3 26.1 19.0 Investment Management 33.6 91.0 22.2 12.1 21.5 2 44.9 Wholesale: 922 64.3 87.9 65.5 76.9 -165.9 -28.4 Three total 175.2 2476 125.1 100.4 126.7 -10
Slide 23: Segment Other
Income (loss) before income taxes’ Full year Quarter (billions of yen) 150 100 94.4 50 -100 544 20 187 66.2 396 Net gain (loss) related to economic a 7 ‘hedging transac ' 175 14.5 56 5.0 14 13.5 34 Realized gain (loss) on investments in equity pe held for operating 66 17 07 01 0O7 02 0.2 Equity in e
Slide 24: Retail related data
(billions of yen) ‘Commissions Full year Of which, sock brokerage commission Of which, commissions for tion of trusts Sales credit Fees from investment banking and other Investment trust administration fees and other Net revenue Non-interest expenses Income before income taxes Domestic distribution
Slide 25: Retail client assets
Retail client assets ® Other 126.6 121.0 126.6 127.0 120 112.2 115.2 = Foreign investment 104.0 trusts: 100 ‘= Bond investment trusts 80 ® Stock investment trusts 60 » Domestic Bonds 40 = Forex ‘reign currency 2 = Equities 0 dun Sep Doe Mar Equities 627 823 70.2 728 72 82.3 82.6 Foreign currency bon
Slide 26: Net inflows of cash and securities
Net inflows of cash and securities' Full year Quarter (billions of yen) (billions of yen) 1,200 1,200 900 ed 900 600 600 300 30 424 on 471 I | . i AS ° ° 8 8 -429 g 600 ae SSS a 25
Slide 27: Number of accounts
Number of accounts (thousands) _-Fvaoig20Fyamo2t Ss vomozt vc Accounts with balance 5,319 5,329 5323 5,323 5,333 5,329 5,348 Equity holding accounts 2,920 2,927 2,935 2,92 2,939 2,927 2,924 NISA accounts opened (accumulated)' 1,737 1,791 1,746 1,753 1,761 4,791 1,820 Online service accounts 4,708 4,
Slide 28: Investment Management results and AuM
Full year’ Quarter’ ete pave mag agg a a posinessrelenie 111.9 273 qainloss “13.6 51.2 136 28 106 242 35.5 467% 159.8% Net revenue 107.9 163.1 397 301 30.4 540 63.5 17.5% 60.0% Non- interest expenses 744 724 175 180 178 188 18.6 11% 61% Income (loss) before income taxes 36 91.0 222 121 215 352 44.9
Slide 29: Asset inflows/outflows by business
Asset inflows/outflows by business’ Full year Quarter a cane) | Frasca 0 °° Investment trusts business 1,788 2753 1,210 563 588 393 M6 of which ETFs 2133 2241 1,153 618 203 268 Ma Investment advsory and intematonal M2 883 -163 63 678 16 128 Total net asset inflow 2,090 1,870 1,047 -70 1,266 373 414
Slide 30: Wholesale results and revenue breakdown
Full year Quarter (billions of yen) ee See eo 10 Qt Net revenue 6486 6914 248.7 2203 231 08 1328 : 6.5% Non-interest expenses 64 6271 1608 1548 146.3 165.2 161.1 24% 0.2% Income (loss) before income taxes 922 643 879 65 76.9 -165.9 -B4 = = Breakdown of Wholesale revenues Full year Quarter (billions
Slide 31: Number of employees
15,748 15,330 16,069 15,807 15,701 15,330 15,556 2,691 2,769 2,728 2,765 2,751 2,769 2,779 2,120 2,152 2,164 2,157 2,158 2,152 2,116 6,070 6,151 6,118 6,140 6,146 6,151 6,196 26,629 26,402 27,079 26,869 26,756 26,402 26,647 Includes Powai office in india
Slide 32: Disclaimer
NOMURA 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
Slide 33: Nomura Holdings, Inc.
Nomura Holdings, Inc. www.nomura.com