Gmo Payment Gateway, Inc. · TSE:3769

Gmo Payment Gateway — Q2 FY2016 Earnings Presentation

30 slides from Gmo Payment Gateway's earnings presentation, May 2, 2016

  1. Slide 1: Financial results briefing for the 2Q of FY2016

    Financial results briefing for the 2Q of FY2016 （October 1, 2015-March 31, 2016） Themes： Achieving continued high growth as a result of our initiatives driving the expansion of the EC market May 2, 2016 The 45 th IR Meeting GMO Payment Gateway, Inc. (3769: Tokyo Stock Exchange section-1) h t t p : /

  2. Slide 2: A Cautionary Note About the Contents of this Document

    A Cautionary Note About the Contents of this Document The contents of this document are based on generally recognized economic and social conditions, as well as premises judged to be reasonable by GMO Payment Gateway as of May 2, 2016. However, please note that they are subject to change without pri

  3. Slide 3: Agenda

    Agenda 1. Summary of Financial Results for 2Q FY2016 2. Progress of the growth strategy 3. Financial highlights Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 3

  4. Slide 4: 1. Summary of Financial Results for 2Q FY2016

    1. Summary of Financial Results for 2Q FY2016 Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 4

  5. Slide 5: Summary

    1.1 Summary OP up 32.3％(2Q, YoY), reflecting the continued strength of payment service & MSB 1H of 2Q of （Million yen） 1Q of FY2016 2Q of FY2016 FY2015 FY2015 Actual Forecast Actual A/F% Change Change% Actual Actual Change% Sales 4,162 5,216 5,730 +9.9 1,567 37.7% 2,204 2,997 36.0% Gross income 3,30

  6. Slide 6: Sales/Gross income

    1.2 Sales/Gross income Sales up 36.0％, gross income (adjusted basis) up 27.3％ • YoY of Gross income ■Sales YoY ■Gross income (adjusted basis : （1,000yen） +36.0％ （1,000yen） YoY excluding outsourcing 2,997,800 +33.9％ expenses of SG&A） 3,000,000 +27.3％ 2,732,786 2,314,995 2,117,708 2,049,413 2,603,210

  7. Slide 7: Operating income/Ordinary income

    1.3 Operating income/Ordinary income Operating income up 32.3％, Ordinary income up 28.7％ Growth rate differences ■Operating income ■ Ordinary income arose due to exchange （1,000yen） （1,000yen） rate fluctuations YoY +32.3％ YoY +28.7％ 1,100,000 1,008,236 1,000,000 994,429 1,000,000 924,496 900,000 870

  8. Slide 8: Forecasts and results

    1.4 Forecasts and results Quarterly forecasts and actual results ■ Forecast for the period ending September 30, 2016 （1,000yen） Sales Forecast （1,000yen） Operating income 3,000,000 Forecast 1,000,000 2,500,000 800,000 2,000,000 600,000 1,500,000 400,000 1,000,000 200,000 500,000 0 0 FY2013 FY2014 FY

  9. Slide 9: Revenue breakdown

    1.5 Revenue breakdown Up over 25% in three major revenue models （1,000yen） 3,000,000 Spread +46.7％ ・MSB continued to grow steadily ・Amount of processed payment increased 2,500,000 1,280,987 Fee +25.3％ 2,000,000 ・Expansion of “Payment after delivery” and Remittance Service (MSB) 873,483 1,500,000 826

  10. Slide 10: Sales/Operating income by Segment

    1.6 Sales/Operating income by Segment Exceeded the forecast ％: YoY (vs. Forecast) ■Sales (segment) ■ Operating income (segment) 593,850 6,000,000 （1,000yen） （1,000yen） 76,480 +57.7％ （+31.5％） +78.2％ （+97.5％） 2,400,000 5,000,000 947,523 42,909 95,879 376,555 +216.9% Turned into （+24.3％） gains 4,000,00

  11. Slide 11: Relative comparison

    1.7 Relative comparison Growth outperforms other competitors related to EC Comparison of operating income / operating Revenue index of EC-related listed firms (quarterly) income growth rate / operating income margin （DEC-14=1) of payment processing firms (FY2015) 1.6 23.0% ●GMO-PG Size: the amount o

  12. Slide 12: 2. Progress of the growth strategy

    2. Progress of the growth strategy Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 12

  13. Slide 13: Quantitative performance targets

    2.1 Quantitative performance targets Sustaining more than 25% income growth is our mission  Developing new business areas (To achieve more than 5％ profit growth) ・FinTech / Money Service Business 3 ・Upfront investments (Global business) 4  Growth of existing business (Foundation for 20% profit gro

  14. Slide 14: Economic trends and our results

    2.2 Economic trends and our results Economy slowdown but our performance have been favorable Real GDP and our sales of payment processing business（Forecast vs actual） （Sales：1,000yen） （Real GDP：％） Revenue exceeded our plan 2200000 1.5 1 2000000 Japanese research organization’s forecasts (average) 0.

  15. Slide 15: Existing business: Online payment

    2.3.1 Existing business：Online payment Cultivating major/growing merchants 1 Sales composition by scale of merchants Positive factors （compared with the same period） （1,000yen） 600,000 Total  Cultivating major merchants +29.9％ （Project with system development, etc） 500,000 The sales composition rat

  16. Slide 16: Existing business: Tax, utility payments

    2.3.2 Existing business：Tax, utility payments Our services chosen by local government 2 Promoting marketing activities National tax, etc for future adoption Number of public institutions which have implemented 2016 GMO-PG services ・Japan Pension Service Apr Taxes of Fukuoka City or Automobile taxes

  17. Slide 17: New business: MSB

    2.4.1 New business ：MSB MSB-related asset increased more than annual plan 3 MSB-related sales MSB-related sales MSB-related sales MSB-related sales（Plan） About ¥0.9bil About ¥0.4bil/1Q About ¥1bil/1H About ¥1.7bil (annual) (Annual) About ¥10bil MSB-related asset About ¥6.2bil About ¥5bil Balance Amo

  18. Slide 18: New business: MSB

    2.4.2 New business：MSB To develop lending businesses in stages 3 Representative Payment due Early payment ×2 Lending Transaction contract twice (Upgrade) Lending （Spread） Measures to increase conversion rate ・Speed up the credit review process About ¥800bil ・Expanding the scope of target merchant （A

  19. Slide 19: New business: MSB

    2.4.3 New business：MSB Asset of Transaction Lending steadily increased 3 Asset of TL About ¥0.6bil ※ About our TL service Total number ： Above 300 About ¥0.4bil Average interest rate： 4～7％ +50.9％ Bad debt ratio： less than 0.5％ About ¥0.2bil +55.6％ ※ Track record of GMO-PG and GMO Epsilon Balance Bal

  20. Slide 20: New business: Global business

    2.5.1 New business：Global business Expanding geographic coverage in India 4 Taiwan India Hong Kong ※ 30～100％ growth area US (Bay Area) Thailand Philippines Viet Nam 6.2 times 1.6 times Malaysia Singapore 500～900％ growth area Our oversea entities Indonesia 2014 2015 2015 2016 ※2016/4/27 GMO-PG made i

  21. Slide 21: New business: Global business

    2.5.2 New business：Global business Steady progress in oversea business, especially in Taiwan 4 ■Started advertisement in Taiwan ■Amount of processed payments, Sales in upward trend 3 times As we confirmed the effects, strengthening the activity to cultivate new merchants The number of inquiries has

  22. Slide 22: 3. Financial highlights

    3. Financial highlights Copyright (C) 1995 GMO Payment Gateway, Inc. All Rights Reserved. 22

  23. Slide 23: Summary of the consolidated results

    3.1 Summary of the consolidated results Sales and income exceed the forecast 1Ｈ of FY2016 YoY 1H of FY2015 （Million yen） Sales Sales Actual composition Growth Growth rate Actual composition Sales 5,730 100.0 1,567 37.7％ 4,162 100.0 Cost of sales 1,297 22.6 439 51.3% 858 20.6 Gross income 4,432 77.4

  24. Slide 24: Summary of the consolidated balance sheets

    3.2 Summary of the consolidated balance sheets MSB linked to current assets Results for Results for 2Q, Results for Results for 2Q, （Million yen） 2Q, FY2016 FY2015 Change （Million yen） 2Q, FY2016 FY2015 Change Current assets 43,788 29,178 14,609 Current liabilities 32,355 24,470 7,884 Deposits 26,92

  25. Slide 25: Revenue Breakdown

    3.3 Revenue Breakdown Spread revenue up 46.7％ （1,000yen） YoY 1,280,987 Initial +12.8％ 1,155,545 1,200,000 1,148,987 Stock ＋38.0％ ※Special Fee ＋25.3％ factor 1,000,000 Spread ＋46.7% 889,917 873,483 826,928 771,471 800,000 752,202 728,714 705,327 689,264 708,637 670,573 681,844 659,842 663,581 568,811

  26. Slide 26: Cost of sales ratio/SG&A ratio

    3.4 Cost of sales ratio/SG&A ratio The sales-cost ratio increased due to the sales mix （1,000yen） ※Excluding MSB-related outsourcing expenses ※50.2％ 2,997,800 52.7% 3,000,000 51.6% 50.9% 2,732,786 50.0% 45.8% 44.4% 44.0% 45.6% 43.2% 43.5% 43.8% 2,603,210 ※39.8％ 2,500,000 ※41.5％ 45.6% 43.6% 42.9% 41.

  27. Slide 27: Transition of the major factors

    3.5 Transition of the major factors Amount of processed payment will exceed ¥2 trillion Number of operating stores 67,921 / Amount of processed payments ¥470 billion / Number of processed payments 228 million Amount of processed payments （Reference） Amount of processed payments (12 months) 1.80 tril

  28. Slide 28: Summary of the consolidated results

    3.6 Summary of the consolidated results Forecast: income growth of +25%, dividend of ¥22.0 per share ¥22.00 (1,000yen) 11,413,000 ¥18.00 ¥15.00 10,000,000 ¥12.25 ※％ yoy ¥9.75 9,030,892 Sales: +26.4％ 8,000,000 ¥7.75 Operating income: +25.7％ 7,205,542 ¥5.88 ¥5.25 ¥4.38 Ordinary income: +25.0％ 5,764,08

  29. Slide 29: Revenue Breakdown

    3.7 Revenue Breakdown Action plans to realize the growth (1,000yen) 10,000,000 ・Cultivate growing merchants ・Service to increase the merchants’ sales + 34.2％ ・Expansion of MSB 8,000,000 such as Transaction Lending, Early payment + 38.4％ ・Cultivating large-scale + 26.7％ merchants 6,000,000 ・GMO payme

  30. Slide 30: Thank you very much!

    Thank you very much! GMO Payment Gateway Inc. (TSE:3769) URL https://corp.gmo-pg.com/en For more information, please contact the Corporate Value Creation Strategy Division Investor relations office TEL:+81-3-3464-0182

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