Slide 1: Earnings Results for the Fiscal Year Ended March 31, 2011
Earnings Results for the Fiscal Year Ended March 31, 2011 May 9, 2011 SOFTBANK CORP.
Slide 2: Disclaimer
Disclaimer This material was prepared based on information available and views held at the time it was made. Statements in this material that are not historical facts, including, without limitation, plans, forecasts and strategies are “forward-looking statements”. Forward-looking statements are by t
Slide 3: Highlights
Highlights 1) Net sales >JPY t; first time ever 2) Operating income JPY 629.1bn 35% YoY increase 2
Slide 4: Results Exceed Forecast Significantly
Results Exceed Forecast Significantly (JPY bn) Forecast at Beginning of Period Actual Consolidated Operating 500.0 629.1 Income 3
Slide 5: Summary of Consolidated Earnings Results
Summary of Consolidated Earnings Results (JPY bn) FY09 FY10 Increment YoY Net sales 2,763.4 3,004.6 +241.2 109% EBITDA 787.6 930.7 +143.0 118% Operating income 465.8 629.1 +163.2 135% Ordinary income 340.9 520.4 +179.4 153% Net income 96.7 189.7 +92.9 196% 4
Slide 6: Comparison to Competitors
Comparison to Competitors (FY2010 YoY) (JPY bn) SOFTBANK NTT DOCOMO KDDI Consolidated net sales 241.2 (60.1) (7.6) Consolidated operating 163.2 10.5 28.0 income Revenue and profit Revenue decrease Revenue decrease increases and profit increase and profit increase 5 *Created by SOFTBANK CORP. based o
Slide 7: Consolidated Net Sales: >JPY 3t first time ever
(JPY t) 3.0 2.8 Consolidated Net Sales >JPY 3t first time ever 9% YoY increase 3 Telecommunications businesses (Mobile Communications, Broadband Infrastructure, Fixed-line telecommunications) Internet Culture Others 0 00 01 02 03 04 05 06 07 08 09 10 (FY) 6
Slide 8: Consolidated EBITDA: Record high for 6 consecutive periods
(JPY bn) 930.7 Consolidated EBITDA 787.6 Record high for 6 consecutive periods 18% YoY increase 3 Telecommunications businesses (Mobile Communications, Broadband Infrastructure, Fixed-line telecommunications) Internet Culture 0 Others 00 01 02 03 04 05 06 07 08 09 10 (FY) 7
Slide 9: Consolidated Operating Income: Record high
(JPY bn) 629.1 Consolidated Operating Income 465.8 Record high for 6 consecutive periods 35% YoY increase 3 Telecommunications businesses (Mobile Communications, Broadband Infrastructure, Fixed-line telecommunications) Internet Culture 0 Others 00 01 02 03 04 05 06 07 08 09 10 (FY) 8
Slide 10: Consolidated Operating Income vs Competitors
(JPY bn) Consolidated Operating Income 844.7 NTT DOCOMO 629.1 SOFTBANK 471.9 KDDI 0 04 05 06 07 08 09 10 (FY) 9 *Created by SOFTBANK CORP. based on respective companies’ publicly available information.
Slide 11: Surpassed NTT DOCOMO
Consolidated Operating Margin (%) 21% SOFTBANK 20 20% NTT DOCOMO 14% KDDI 10 Surpassed NTT DOCOMO 04 05 06 07 08 09 10 (FY) 10 *Created by SOFTBANK CORP. based on respective companies’ publicly available information.
Slide 12: Significant profit increase
+54% Operating Income Growth Mobile Communications Significant profit increase +1% -9% NTT au DOCOMO SOFTBANK *Created by SOFTBANK CORP. based on respective companies’ publicly available information. 11 *FY2010 actual figures.
Slide 13: Toward domestic #3
Operating Income Ranking (FY2010) Rank Company Name Amount 1 NTT JPY 1,180.0bn (Forecast) 2 NTT DOCOMO JPY 844.7bn Toward domestic #3 3 SOFTBANK JPY 629.1 bn 4 Honda R&D JPY 569.7bn 5 TOYOTA MOTOR JPY 550.0bn (Forecast) 6 NISSAN MOTOR JPY 535.0bn (Forecast) 7 INPEX JPY 488.0bn (Forecast) 8 KDDI JPY
Slide 14: Consolidated Ordinary Income: Record high for 2 consecutive periods
(JPY bn) 520.4 Consolidated Ordinary Income 340.9 Record high for 2 consecutive periods 53% YoY increase 0 00 01 02 03 04 05 06 07 08 09 10 (FY) 13
Slide 15: Consolidated Net Income: Record high
(JPY bn) 189.7 Consolidated Net Income 96.7 Record high 96% YoY increase 0 (Reference) FY2010 Special loss (loss on disaster) JPY (14.4bn) 00 01 02 03 04 05 06 07 08 09 10 (FY) 14
Slide 16: Consolidated Operating Cash Flow: Steady increase
Consolidated Operating Cash Flow (JPY bn) 825.8 668.0 Steady increase 24% YoY increase 0 00 01 02 03 04 05 06 07 08 09 10 (FY) 15
Slide 17: Consolidated Free Cash Flow: Steady increase
Consolidated Free Cash Flow (JPY bn) 561.3 390.8 Steady increase 44% YoY increase 0 00 01 02 03 04 05 06 07 08 09 10 (FY) 16
Slide 18: Commitment to be reached imminently
Consolidated Free Cash Flow 3 year aggregate JPY 1t Commitment to be FY2011 reached imminently FY2010 JPY 561.3bn 2 year aggregate JPY 952.2bn FY2009 JPY 390.8bn 17
Slide 19: SBM Loan Balance: Steady reduction
SBM Loan Balance JPY 1.36t 1.4 1.2 Steady reduction 1.0 (approx. JPY 740.0bn reduction) 0.8 0.6 0.4 JPY 627.0bn Apr. 2011 0.2 Minimum case 0 Inception of 08 09 10 11 12 13 14 15 16 17 18 (CY) borrowing Nov. 2006 18
Slide 20: Net Interest-bearing Debt: Steady progress
Commitment to Reduce 2.4t Net Interest-bearing Debt 1.9t Steady progress 1.5t 2010 1.2t 4,890 Half Zero 0 June FY08 FY09 FY10 FY11 FY14 19 2006 (target) (target) *”Half” refers to half the end of FY08 level.
Slide 21: JCR Rating: First A Zone in 11 Years
JCR Rating A- A- BBB+ First A Zone in BBB 11 Years BBB- 00 01 02 03 04 05 06 07 08 09 10 11 (CY) 20 *JCR: Japan Credit Rating Agency
Slide 22: No changes to the dividend increase policy
Dividend per Share Up No changes to Up the dividend JPY 5.0 JPY 5.0 increase policy JPY 2.5 05 06 07 08 09 10 11 12 13 14 (FY) 21 (plan) *Amount after FY2011 has not been determined yet.
Slide 23: 5 Years Since Entered Mobile Business
5 Years Since Entered Mobile Business 22
Slide 24: 23
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Slide 25: Profit X Base
Base Subscribers Profit stations X 5 6 7 X + 0% 24
Slide 26: Mobile Communications Operating Income
JPY 402.4bn Mobile Communications Business SOFTBANK Operating Income Vodafone Japan 0 JPY 76.3bn x 5 08 (FY) 02 03 04 05 06 07 09 10 25
Slide 27: Number of base stations
122k Number of base stations 6 SOFTBANK Vodafone Japan 21k x 0 03 04 05 06 07 08 09 10 (FY) 26 *Excludes home femtocell and home repeaters.
Slide 28: Cumulative subscribers
25.40mil Cumulative subscribers SOFTBANK Vodafone Japan 15.20mil 7 + 0% 0 (FY) 03 04 05 06 07 08 09 10 27
Slide 29: Strategies for Further Growth
Strategies for Further Growth Increase CAPEX Enhance customer acquisition 28
Slide 30: Consolidated CAPEX: Next step for further growth
500.0 (JPY bn) 420.5 Consolidated CAPEX Next step for further growth 0 (FY) 06 07 08 09 10 11 (plan) 29
Slide 31: CAPEX per Subscriber (mobile)
CAPEX per Subscriber (mobile) 14,900 11,700 10,400 au NTT NTT DOCOMO SOFTBANK au DOCOMO SOFTBANK FY2010 (actual) FY2011 (plan) 30 *Created by SOFTBANK CORP. based on respective companies’ publicly available information. *Calculation based on CAPEX/average number of subscribers during the period ((su
Slide 32: Frequency Allocation
Frequency Allocation Total: uplink+downlink 130 NTT DOCOMO 800MHz band MHz 90 KDDI 800MHz band MHz 700 / 900 60 SOFTBANK MHz band MHz 31 *Created by SOFTBANK CORP. based on press release of MIC. Bandwidth allocated beyond 3G.
Slide 33: Information Lifeline
Information Lifeline 32
Slide 34: Base Station Restoration After the Disaster
Base Station Restoration After the Disaster Restore base Satellite base Placement of power stations stations generators 33
Slide 35: Network Recovery Status (Tohoku and Kanto)
Network Recovery Status (Tohoku and Kanto) Recovered Completely recovered 19% No damage 81% (16,164 stations) Total 19,950 *Affected area as of Mar. 12 2011. *Excluding base stations within 20km zone of nuclear power plant, 34 base stations 1.5GHz bandwidth, recovered base stations without power, 82
Slide 36: Status of Reconstruction Support
masason Status of Reconstruction Masayoshi Son Support “Let’s Do It” Currently 26 36 items Free mobile phone rental to evacuation centers and volunteers Increase available messages on Disaster Message Board from 3 to 80 Relief supply management system Expand types of handsets enabled with emergency
Slide 37: Reconstruction Support Portal
Reconstruction Support Portal Information bridge between victims and supporters 36
Slide 38: Broadcasted the Disaster Related News Worldwide
Broadcasted the Disaster Related News Worldwide Total access over 68mil people (Source) USTREAM 37 *Data obtained: Mar. 10-25, 2011.
Slide 39: Number of Unique Users (monthly)
Number of Unique Users (monthly) (mil) 10 9.82mil 8 6 4 2 0 Aug.Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug.Sept. Oct. Nov. Dec. Jan. Feb. Mar. 2009 2010 2011 (Source) USTREAM 38
Slide 40: Means of communication during disaster
Means of communication during disaster PHS performed better than mobile phone 39
Slide 41: WILLCOM's Net Additions: First increase in 4 years
(k) WILLCOM’s Net Additions 150 Support First increase 0 in 4 years -150 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2007 2008 2009 2010 40 *Quarterly basis.
Slide 42: Dispersion of risk during disaster or blackouts
Rapid Increase in Demand for Datacenters 180 racks Dispersion of risk during disaster or blackouts 15 racks FY10 FY11 Apr. Average monthly orders Inquiries *SOFTBANK TELECOM research. 41
Slide 43: Datacenter and Cloud Business Alliance
Datacenter and Cloud Business Alliance KT Corporation Support Japan’s industry recovery 42
Slide 44: SOFTBANK Group Power Saving Efforts
SOFTBANK Group Power Saving Efforts Roll out work from home solutions to all (20k) Virtual desktop employees Toward 30% power saving *All employees of SOFTBANK 3 telecommunications companies + Willcom + SOFTBANK CORP. (including irregular employees). 43
Slide 45: Donation of Relief Money & Aid
Donation of Relief Money & Aid SOFTBANK Group JPY 1bn Donation (Japanese Red Cross Society and The Central Community Chest of Japan) Support for children orphaned by disaster NPO & volunteer support 44
Slide 46: Swift response to the disaster recognized
Pleasing - Appealing Companies (Apr.) Company Name Swift response 1st SOFTBANK to the disaster 2nd UNIQLO recognized 3rd SUNTORY 4th YAMATO TRANSPORT 5th LAWSON 45 (Source) Company likability survey issued by Nikkei BP Consulting, Inc. (Apr.).
Slide 47: Towards No.1 Mobile Internet
Towards No.1 Mobile Internet 46
Slide 48: Full-fledged mobile Internet
(mil) 700 700 Number of Computer Terminals Shipped (world) 600 600 Full-fledged mobile Internet 500 500 400 400 Smartphone 300 300 Tablet 200 200 100 100 Desktop PC 00 ‘95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 47 (Source) “Tablet Demand and Disruption” issued by Morgan Stanley on Feb. 14, 201
Slide 49: Thanks for waiting: iPhone in white
Thanks for waiting iPhone 4 in white Launched Apr. 28 48
Slide 50: Female Users Among New iPhone Subscribers
Female Users Among New 50% iPhone Subscribers 40% Accelerate 30% 20% 10% H1 H2 H1 H2 H1 H2 FY2008 FY2009 FY2010 49
Slide 51: iPad 2
iPad 2 Launched Apr. 28 50
Slide 52: iPad vs iPad 2
iPad 2 iPad 1GHz dual core 1GHz Faster Apple A5 Processor Apple A4 Thinner 8.8mm Thickness 13.4mm Lighter 613g Weight 730g 2 Camera 51 *iPad 2 refers to Wi-Fi + 3G model.
Slide 53: iPad 2 for everybody
iPad 2 for everybody. Actual payment 0 JPY iPad 2 Wi-Fi+3G (16GB) *Campaign period: Apr. 28 - Sept. 30, 2011. 52 *Actual payment: payment for handset born by user when signing up for a 25 month contract .
Slide 54: Companies That Will Introduce Tablets Within 1 Year
Companies That Will Introduce Tablets Within 1 Year 67% 53 Source: “Tablet Demand and Disruption” issued by Morgan Stanley on Feb. 14, 2011, questionnaire to 50 CIOs.
Slide 55: Cumulative Shipments Since Launch
(mil) Cumulative Shipments Since Launch 500 5 (world wide) 4 400 Tablet (forecast) 3 300 2 200 100 1 Netbook 0 1st year 2nd 3rd 4th 5th 54 Source: “Tablet Demand and Disruption” issued by Morgan Stanley on Feb. 14, 2011.
Slide 56: Towards No.1 Internet in Asia
Towards No.1 Internet in Asia 55
Slide 57: Asia to rapidly grow
GDP Growth Forecast in Next 20 Years (annual basis) China 9.0% India 8.4% Philippines 7.5% Malaysia 6.9% Indonesia 6.5% Thailand 5.6% Brazil 5.5% South Africa 5.4% Russia 5.3% Korea 3.7% US 2.3% Australia 2.1% Canada France 2.0% 1.9% Asia to rapidly UK Spain Italy 1.2% 1.1% 1.7% grow Germany 1.0% 56
Slide 58: Transitioning to Asian era
GDP Share by Area 2030 (forecast) JPY 11,400t Transitioning to Asian era 2010 JPY 5,100t 44% 12% Asia 25 17 USA 23% 24% 57 Source Goldman Sachs Global ECS Research (Sept. 8, 2010).
Slide 59: SOFTBANK Asian Internet Group
SOFTBANK Asian Internet Group 58
Slide 60: US IPO
May 4, 2011 US IPO Listing on NYSE 59
Slide 61: Investment in Renren
Investment in Renren approx. JPY 200.0bn Voting rights 33.4% x approx. IRR130% (after IPO) JPY 41.8bn Market cap approx. JPY 600.0bn Cumulative SOFTBANK equity investment amount market cap *As of May 4. *$ = 83JPY 60 (Apr. ‘08 - Jan. ‘11) SOFTBANK equity market cap: Renren market cap 7.2bn$×SOFTBANK
Slide 62: No.1 Online TV in China
No.1 Online TV in China 67
Slide 63: Number of Monthly Active Users
Number of Monthly Active Users (mil) 100 100 mil Steadily increasing 50 0 2008 2009 2010 2011 68 Source PPLive end of Mar. each year.
Slide 64: User Comparison: Towards online TV era
User Comparison 100 100mil Towards online Cable TV (US) TV era 50 20mil Netflix (Market cap approx. JPY 1t 0 04 05 06 07 08 09 10 (Source) Netflix: IR material. Market cap as of May 6. 69 Cable TV data from National Cable & Telecommunication Association.
Slide 65: Internet TV Comparison
Internet TV Comparison Average daily viewing time 16hrs 29min x3 PPTV 5hrs 35min Hulu Monthly unique x10 viewers 10mil 100mil (Source) PPTV data PPLive, Hulu data Nielsen (Jan. 2011). 70
Slide 66: Internet TV for iPad
Feb. 2011 Launched PPTV for iPad Internet TV for iPad First in China 71
Slide 67: Chinese Soccer League exclusive broadcast
Chinese Soccer League Exclusive live broadcast 2011 Super League Further user expansion 72
Slide 68: Japan's Leading Talent Agency Goes Global
Today’s announcement Japan’s Leading Talent Agency and Content Production Goes Global
Slide 69: Contents Bank Joint Venture
Establish Joint Venture 60% 40% Contents Bank 74
Slide 70: Creation of Joint Venture
Today’s announcement An Innovative Online Shopping Destination Creation of Joint Venture 75
Slide 71: Innovative Online Shopping Destination
Innovative Online Shopping Destination Membership/ order Direct deal Product Registered Popular Members Gilt luxury brands Sales of coveted brands at discounted prices 76
Slide 72: Example of Partner Brands (US)
Example of Partner Brands (US) Emporio Armani sergio rossi Brooks Brothers Paul & Joe Sisters CELINE Swarovski FRENCH CONNECTION Chloe BCBG MAXAZRIA dunhill Hugo Boss MARC JACOBS Calvin Klein JILL STUART LAMB 77
Slide 73: Number of Gilt Groupe Members
Number of Gilt Groupe Members (world) (mil) 3.5 3.5+ mil 3.0 2.5 2.0 1.5 1.0 0.5 0 78 2007 2008 2009 2010 2011 *Press release of Gilt Groupe.
Slide 74: Gilt Japan Joint Venture
Establish Joint Venture JPY 5.2bn 50% 50% Gilt Japan * Total investment amount of SOFTBANK Group. 79 * JPY 5.2bn : 62.5mil$ converted at $=83JPY.
Slide 75: Synergy Generation in SOFTBANK Group
Synergy Generation in SOFTBANK Group Mobile Internet Cooperation with Yahoo! ID etc 80
Slide 76: Into China
One of the largest shopping sites in Japan Into China 81
Slide 77: Transaction Value: One of the largest in Japan
(JPY bn) Transaction Value 60,000 JPY 57.1bn One of the largest in Japan 40 40,000 20 20,000 00 03 04 05 06 07 08 09 10 (FY) 82 (Source) IR material by START TODAY.
Slide 78: Number of Members: One of the largest in Japan
Number of Members (mil) 3.13 One of the 3,200,000 3 2,742,857 largest in Japan 2,285,714 2 1,828,571 1,371,429 1 914,286 457,143 0 0 03 04 05 06 07 08 09 10 (FY) 83 (Source) IR material by START TODAY.
Slide 79: Establish Joint Venture START TODAY HONG KONG
Establish Joint Venture 49.9% 50.1% START TODAY HONG KONG CO. LTD. (tentative name) *SOFTBANK investment ratio is the total of holding ratio by the SOFTBANK Group after exercising SARs. 84
Slide 80: Market Size of Online Fashion Shopping Sites
Market Size of Online Fashion Shopping Sites (JPY bn) 2,500 250 200 2,000 150 1,500 Toward 100 1,000 expansion 500 500 (Source) Japan: Results of “FY2009 Research on Infrastructure Development in Japan’s Information Economy Society (E-Commerce Market Survey)” issued by Ministry of Economy, Trade and
Slide 81: ZOZOTOWN Expand to China
ZOZOTOWN Expand to China Taobao Mall 1,555 brands TaoBao platform ZOZOTOWN Chinese e-Commerce site 86
Slide 82: Synergy Generation in SOFTBANK Group
Synergy Generation in SOFTBANK Group Customer attraction & Business support promotion in China 87
Slide 83: Connect People Globally With Information
Connect People Globally With Information 88
Slide 84: Summary
Summary 1) Prioritize CAPEX & customer acquisition while continuing revenue & profit growth 2) Internet expansion in Asia Renren IPO 89
Slide 85: Make people happy through information revolution
Make people happy through information revolution 90
Slide 86: SoftBank
SoftBank
Slide 87: Application of accounting standard and definition of terms
1. Application of accounting standard for disclosure on segments The “Accounting Standard for Disclosures about Segments of an Enterprise and Related Information” and related “Guidance on the Accounting Standard for Disclosures about Segments of an Enterprise and Related Information” are applied fro