Slide 1: Earnings Results for the Fiscal Year Ended March 31, 2018
v.1.3 Earnings Results for the Fiscal Year Ended March 31, 2018 Investor Briefing May 11, 2018 SoftBank Group Corp.
Slide 2: Legal Disclaimer for SoftBank Presentation
LEGAL DISCLAIMER for SoftBank Presentation This presentation (this “Presentation”) is furnished to you for informational purposes and is not, and may not be relied on in any manner as, legal, tax, investment, accounting or other advice or as an offer to sell or a solicitation of an offer to buy limi
Slide 3: 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 4: Accounting
Accounting 4
Slide 5: Segments and Core Companies
Segments and Core Companies FY16 FY17 Reportable segments Core companies Reportable segments Core companies Domestic SoftBank Domestic SoftBank Telecommunications Wireless City Planning Telecommunications Wireless City Planning Sprint Sprint Sprint Sprint Yahoo Japan Yahoo Japan Yahoo Japan ASKUL Ya
Slide 6: Consolidated P/L Summary (IFRSs)
Consolidated P/L Summary (IFRSs) 1 Operating income: Boost by gain on valuation of shares of SoftBank Vision Fund (+JPY 346 bn) 2 Non-operating income/loss: (i) income on equity method investments related to Alibaba (+JPY 424.8 bn): (ii) derivative loss related to a forward contract on Alibaba share
Slide 7: Consolidated B/S Summary: Non-current assets
Consolidated B/S Summary (IFRSs) - 1 1 Total fair value of investments of SoftBank Vision Fund and Delta Fund: USD 26.7 bn (excl Arm shares of USD 6.4 bn) 2 Investments by the Company to Uber and DiDi: Total JPY 1,378.8 bn (USD 12.9 bn) 3 Assets increase due to consolidation of The Japan Net Bank: J
Slide 8: Consolidated B/S Summary: Liabilities
Consolidated B/S Summary (IFRSs) - 2 1 Borrowing of USD 8.0 bn using Alibaba shares, and issuance of foreign currency-denominated bonds of USD 3.35 bn and EUR 2.25 bn. 2 Increase in third-party interests in SoftBank Vision Fund and Delta Fund: JPY 1,804.0 bn (Mainly due to contributions from third-p
Slide 9: Consolidated B/S Summary: Equity
Consolidated B/S Summary (IFRSs) - 3 1 Other equity instruments was recorded for USD-denominated Undated Subordinated Notes issued in July 2017 (JPY bn) B/S As of As of Items Change Primary changes item Mar 2017 Mar 2018 4,469.7 6,273.0 +1,803.3 Common stock 238.8 238.8 - Capital surplus 245.7 256.8
Slide 10: Consolidated C/F Summary (IFRSs)
Consolidated C/F Summary (IFRSs) 1 Acquisition of investments by SoftBank Vision Fund and Delta Fund: JPY 2,263.3 bn Investment by the Company in Uber and DiDi: total JPY 1,378.8 bn (USD 12.9 bn) 2 Cash increased due to refinancing, borrowings by using Alibaba shares, and issuance of corporate bonds
Slide 11: Outline of Funds in SoftBank Vision Fund and Delta Fund
Outline of Funds in SoftBank Vision Fund and Delta Fund As of March 31, 2018 SoftBank Vision Fund Delta Fund Major limited partnership SoftBank Vision Fund L. P. SB Delta Fund (Jersey) L. P. Total committed capital USD 91.7 bn *1 USD 6.0 bn *1 SBG: USD 28.1 bn *2 SBG: USD 4.4 bn Third-party investor
Slide 12: Capital Deployment of SoftBank Vision Fund and Delta Fund
Capital Deployment of SoftBank Vision Fund and Delta Fund (USD bn) As of Mar 31, 2018 Total The Company Third-party investors Committed capital SoftBank Vision Fund 91.7 *1 28.1 *2 63.6 *1 *1 *1 Delta Fund 6.0 4.4 1.6 Contribution from limited partners*3 SoftBank Vision Fund 21.2 6.4 14.8 Delta Fund
Slide 13: Investments of SoftBank Vision Fund and Delta Fund -1
Investments of SoftBank Vision Fund and Delta Fund -1 As of Mar 31, Investment portfolio 2018 Company names Businesses (in alphabetical order) Arm Limited Semiconductor technology designer Auto1 Group GmbH Used car wholesaler in Europe Brain Corporation AI-based autonomous driving system developer F
Slide 14: Investments of SoftBank Vision Fund and Delta Fund -2
Investments of SoftBank Vision Fund and Delta Fund -2 Acquisition As of Mar 31, 2018 Fair value cost Investments acquired 29.7 33.0 Investments agreed to be transferred 0.1 0.1 from the Company Total (USD bn) 29.8 33.1 Excl. consolidated subsidiaries -6.4 -6.4 *Arm Total (USD bn) 23.4 26.7 Recorded
Slide 15: Income and loss from SoftBank Vision Fund and Delta Fund business
Income and loss arising from the SoftBank Vision Fund and Delta Fund business included in P/L Income and loss arising from the SoftBank Vision Fund and Delta Fund business included above the income before income tax line in the consolidated statement of income are calculated by aggregating income an
Slide 16: Entities that compose SoftBank Vision Fund and Delta Fund
Entities that compose SoftBank Vision Fund and Delta Fund SoftBank Vision Fund and Delta Fund consist of GP/SBIA UK, SBIA US/SBIA JP, and Limited Partnership (Fund). SoftBank Group Corp. （SBG） Wholly-owned subsidiary Wholly-owned subsidiary SoftBank Vision Fund or LP Delta Fund Investment SBIA US/ a
Slide 17: Accounting Treatment for Investment Portfolio
Accounting Treatment for Investment Portfolio (investees) SBG consolidated financial statements treat subsidiaries as consolidated and the others as financial instruments at FVTPL in principle. SBG consolidation: Fund (stand-alone): SoftBank Group Corp. SoftBank Group Corp. (NOT investment entity un
Slide 18: Accounting Treatment for Third-party Interests
Accounting Treatment for Third-party Interests in SoftBank Vision Fund and Delta Fund Third-party interests are classified as liabilities Fund life is finite; Third-party interests Obliged to distribute classified as “liabilities” to investors Types of contribution to SVF; - Equity (Performance-base
Slide 19: Income on Equity Method Investments Related to Alibaba
Income on Equity Method Investments Related to Alibaba Alibaba SoftBank Group US GAAP IFRSs (CNY mil) (JPY bn) Income on equity Reconciliation Income on equity Net income Net income Ownership method Exchange rate method investments to IFRSs investments FY16Q1 5,365 1,434 6,799 Approx. 33% 2,216 JPY
Slide 20: Derivative Gain and Loss Relating to Variable Prepaid Forward Contract
Derivative Gain and Loss Relating to Variable Prepaid Forward Contract for Alibaba shares $173 $184 Total gain to be recorded Alibaba share $106 $108 at time of settlement price $77 (USD 11.5 bn) Cumulative increase of +USD 11.5 bn USD USD Derivative assets 6.8 bn Gain on sale 4.8 bn of +USD 0.9 bn
Slide 21: (Reference) Difference in Tax Rate
(Reference) Difference in Tax Rate FY16 FY17 Reconciliation Between Statutory Tax Rate and Effective Tax Rate Amount Amount Rate (%) Rate (%) (JPY bn) (JPY bn) Income before income tax 712.5 384.6 Statutory income tax rate 31.7% 225.8 31.7% 121.9 (main factors of difference) - Impact from US tax ref
Slide 22: Impacts from the US Tax Reform
（Summary）Impacts from the US Tax Reform (USD bn) (1) The US 5.2 corporate tax Increase Reversal of rate cut net income deferred tax liabilities Sprint’s 2.0 Recognition of (2) Abolition of time limit on use of USD 7.2 bn 15.4 loss carryforward*2 deferred tax deferred tax assets liabilities *1 * This
Slide 23: Appendix
Appendix 23
Slide 24: Financing from sale of Alibaba shares
Variable Prepaid Forward Contract (Monetization of Alibaba shares, June 2016) Financing from sale of Alibaba shares （June 2016） Alibaba shares pledged as collateral (to be delivered in Jun 2019) Mandatory Exchangeable Trust USD 5.4 bn* (as advances received on sale of shares) (Notes) 1. Alibaba shar
Slide 25: In case of Alibaba share price decline
Variable Prepaid Forward Contract (Monetization of Alibaba shares, June 2016) Variable prepaid In case of forward contract (collar transaction) Alibaba share price decline Alibaba shares pledged as collateral (to be delivered in Jun 2019) Mandatory Exchangeable Trust USD 5.4 bn* (as advances receive
Slide 26: Variable Prepaid Forward Contract: June 2019
Variable Prepaid Forward Contract (Monetization of Alibaba shares, June 2016) Variable prepaid June 2019 forward contract (collar transaction) Cumulative derivative losses over 3 years to be converged to USD 0.9 bn Alibaba shares pledged as collateral (to be delivered in Jun 2019) Gain on sale to be
Slide 27: Collar Transaction Embedded in Variable Prepaid Forward Contract
Collar Transaction Embedded in Variable Prepaid Forward Contract Number of shares delivered to investors 86 million shares At signing of contract USD 6.6 bn equivalent 73 million shares USD 76.69 USD 90.11 Alibaba share price 27
Slide 28: Collar Transaction Embedded in Variable Prepaid Forward Contract
Collar Transaction Embedded in Variable Prepaid Forward Contract Number SBG is not subject to of shares delivered Derivative gains downside even from a to be recorded to investors decline in share price 86 million shares SBG is partially subject to upside At signing of contract USD 6.6 bn equivalent
Slide 29: Status of Alibaba Shares -1
Status of Alibaba Shares -1 $173 $184 Alibaba share price $106 $108 USD 137.1 bn $77 Total market value up USD 79.0 bn Total market value USD of Alibaba shares USD 58.1 bn 123.7 bn Market value of USD Alibaba shares 51.5 bn Cumulative after settlement increase of Market value of USD 6.8 bn Alibaba s
Slide 30: Status of Alibaba Shares -2
Status of Alibaba Shares -2 $173 $184 Alibaba share price $106 $108 $77 Increase in market value was not recorded on P/L Cumulative increase of Market value of USD 6.8 bn Alibaba shares scheduled to be delivered USD 6.6 bn USD 6.6 bn USD 13.4 bn Number of Alibaba shares Jun 2016 Sep 30, 2016 Mar 31,
Slide 31: Status of Alibaba Shares -3
Status of Alibaba Shares -3 $173 $184 Alibaba share price $106 $108 $77 Derivative liabilities recorded on B/S Derivative assets Cumulative increase of Market value of of +USD 0.9 bn USD 6.8 bn Alibaba shares scheduled to be delivered USD 6.6 bn USD 6.6 bn USD 13.4 bn USD 6.7 bn Derivative liabiliti
Slide 32: Status of Alibaba Shares -4
Status of Alibaba Shares -4 $173 $184 Alibaba share price $106 $108 $77 Increase in derivative liabilities recorded on P/L (Cumulative derivative losses: USD 7.6 bn) Derivative assets Cumulative increase of Market value of of +USD 0.9 bn USD 6.8 bn Alibaba shares scheduled to be delivered USD 6.6 bn
Slide 33: Status of Alibaba Shares -5
Status of Alibaba Shares -5 $173 $184 Alibaba share price $106 $108 $77 Total gain to be recorded at time of settlement (USD 11.5 bn) Cumulative Derivative assets increase of +USD11.5 bn Market value of of +USD 0.9 bn USD 6.8 bn Alibaba shares USD 4.8 bn Gain on sale scheduled to be delivered USD 6.
Slide 34: (Reference) Breakdown of Goodwill
(Reference) Breakdown of Goodwill (JPY bn) B/S As of As of Change item Main items Mar 2017 Mar 2018 Changes in Outline Others exchange rate 4,175.5 4,302.6 +148.6 -21.5 Decrease in “others” is related to adjustment Arm 2,687.9 2,851.4 +167.8 -4.3 to the provisional amount of PPA. SoftBank 907.5 907.
Slide 35: (Reference) Breakdown of Intangible Assets
(Reference) Breakdown of Intangible Assets (JPY bn) B/S As of As of Change Main items Changes in Outline item Mar 2017 Mar 2018 Amortization Others exchange rate FCC licenses 4,100.7 3,960.6 - -221.6 +81.5 (non-amortized) Increase in “others” mainly related to FCC licenses acquired through Sprint 4,
Slide 36: Finance
Finance 36
Slide 37: Main Activities in FY2017 (Investments)
Main Activities in FY2017 (Investments) Event Amount Timing May First major closing of SoftBank Vision Fund*1 Total committed capital: USD 93.2 bn → USD 97.7 bn 2017 (incl. capital committed by SBG: USD 28.0 bn → USD 32.5bn)*2 Addition of committed capital to By Sep SoftBank Vision Fund and Delta Fu
Slide 38: Main Activities in FY2017 (Funding)
Main Activities in FY2017 (Funding) Event Amount*1 Timing NC6 USD 2.75 bn (JPY 311.3 bn) Issuance of USD-denominated Undated Jul Subordinated Hybrid Notes 2017 NC10 USD 1.75 bn (JPY 198.1 bn) USD7Y USD 1.35 bn (JPY 148.6 bn) USD10Y USD 2.00 bn (JPY 220.1 bn) Issuance of USD and EUR- Sep denominated
Slide 39: Adjusted EBITDA and Adjusted EBITDA Margin (1)
Adjusted EBITDA and Adjusted EBITDA Margin (1) Consolidated adjusted EBITDA has been stable. Adjusted EBITDA Adjusted EBITDA Margin (JPY bn) Domestic Telecommunications Sprint Yahoo Japan Distribution Arm Consolidated 2,564.5 2,605.1 47% 36% 1,079.6 1,227.3 38% 34% 30% 53.1 29% 28% 30.9 239.5 27.5 2
Slide 40: Adjusted EBITDA and Adjusted EBITDA Margin (2)
Adjusted EBITDA and Adjusted EBITDA Margin (2) Domestic Telecommunications segment has sustained high margin. Adjusted EBITDA Adjusted EBITDA margin (Domestic Telecommunications) (JPY bn) 1,209.0 1,178.1 SoftBank 38% (Domestic 36% Telecom) NTT DOCOMO 32% 32% KDDI 32% 31% 29% SoftBank Group 28% (Cons
Slide 41: Interest-bearing Debt
Interest-bearing Debt YoY increase due to financing for contribution into SoftBank Vision Fund Major changes Sprint JPY bn from Mar 2017 Borrowings 1,511.0 +307.1 (Spectrum finance) (JPY bn) Bonds 2,802.6 -384.4 (Redemption) 15,855.4 Other 30.3 14,653.7 14,703.0 14,142.9 14,183.3 Total 4,343.9 4,343
Slide 42: Cash Position
Cash Position Remain high while new investments were executed. ( 4,711.9 ) *After considering transfer of rideshare investments (JPY bn) 1,506.8 Cash position of JPY 219.9 bn at SoftBank Vision Fund 3,414.3 and Delta Fund and cash position of JPY 433.0 bn at 3,177.9 3,205.0 The Japan Net Bank are ex
Slide 43: Net Interest-bearing Debt
Net Interest-bearing Debt Temporarily increased due to bridge investment in Uber and DiDi Net interest-bearing debt of JPY278.5 bn at (JPY bn) SoftBank Vision Fund and Delta Fund and net interesting-bearing debt of JPY275.3 bn at the Japan Net Bank are excluded. 12,650.4 12,280.2 11,207.6 11,239.4 1
Slide 44: Result of USD/EUR Notes Restructuring
Result of USD/EUR Notes Restructuring 2015 Notes*1: Consent solicitation and exchange offer 2015 Notes amended USD 2.0 bn 2015 EUR 2.25 bn Balance: USD 3.0 bn equiv. Notes Total USD 4.8 bn equiv. New exchange notes (10 years) New issuance: USD 1.9 bn equiv. 2013 Notes*2: Early redemption Noticed to
Slide 45: Subsidiary Guarantee on SBG Debts
Subsidiary Guarantee on SBG Debts • After the listing of SoftBank Corp. is approved by TSE, guarantee on SBG debts would be released. • All the senior unsecured debts of SBG will be pari passu after the guarantee release. Condition of guarantee release Listing approval TSE approval of the listing of
Slide 46: Non-Recourse Margin Loan: Principal terms
Non-Recourse Margin Loan - Executed non-recourse financing by using highly-liquid Alibaba ADR shares - Built great flexibility into short-term financing needs with revolver facility Trading value ranking Principal terms in US market*1 Execution 30 day-average March 2018 trading value Date 1 AMAZON U
Slide 47: Leverage Ratio
Leverage Ratio Net leverage ratio temporarily increased due to bridge investment in Uber and DiDi Leverage ratio (gross / net) 6.0x (Gross) 5.3x 4.8x (Net) 4.2x *4.2x *After considering transfer of rideshare investments Mar'17 Mar '18 *1 Gross leverage ratio = interest-bearing debt / adjusted EBITDA
Slide 48: Net Leverage Ratio (Consolidated)
Net Leverage Ratio (Consolidated) 6.2x (immediately after Vodafone K.K. acquisition) 4.8x *4.2x *After considering transfer of rideshare investments 1.1x Jun '06 Mar '07 Mar '08 Mar '09 Mar '10 Mar '11 Mar '12 Mar '13 Mar '14 Mar '15 Mar '16 Mar '17 Mar '18 *1 Net leverage ratio = net interest-beari
Slide 49: Leverage Ratio of Domestic Telco Business and Debt Coverage Ratio
Leverage Ratio of Domestic Telco Business and Debt Coverage Ratio Leverage ratio of Domestic Telco business Debt coverage ratio Domestic Others Telco <Equity Holdings> (incl. Sprint acquisition cost) etc. Net interest- Net interest- JPY 3.0 tn JPY 5.2 tn bearing debt bearing debt Adjusted = 2.6x Equ
Slide 50: Leverage Ratio of Domestic Telco Business and Debt Coverage (details)
Leverage Ratio of Domestic Telco Business and Debt Coverage (details) Domestic Telco Others 2.6x 24% 29% (*Before considering transfer of rideshare investments) Net interest-bearing debt Net interest-bearing debt (consolidated basis) +JPY 12.93 tn JPY 1.77 tn Securities of receivables - Net interest
Slide 51: Shareholders' Equity Ratio
Shareholders’ Equity Ratio Shareholders’ equity significantly increased due to net income growth and the Hybrid Notes issuance. Shareholders’ equity *1 Shareholders’ equity ratio (JPY bn) Adjusted *2 273.0 shareholders’ equity Adjusted ratio of shareholders’ equity *2 17.2% 231.4 15.5% 16.3% 14.6% 5
Slide 52: Debt / Equity Ratio
Debt / Equity Ratio Debt / equity ratio (gross / net) 3.6x 3.0x（Gross） 2.9x 2.4x（Net） *2.1x *After considering transfer of rideshare investments Mar'17 Mar'18 *1 Debt / equity ratio = interest-bearing debt / equity attributable to owners of the parent (shareholders’ equity after considering adjustme
Slide 53: Interest Expense
Interest Expense Interest expense increased due to Hybrid Notes and foreign currency- denominated senior bonds. Interest expense (finance cost) Interest coverage ratio (JPY bn) Excl. Sprint Sprint Excl. Sprint Consolidated 516.1 467.3 267.1 7.6x 272.6 5.5x 5.5x 5.0x 249.0 194.7 FY16 FY17 FY16 FY17 *
Slide 54: Market Cap: Major Listed Shareholdings of SBG and Its Subsidiaries
Market Cap: Major Listed Shareholdings of SBG and Its Subsidiaries Listed shareholdings amount to JPY 17 tn. 17.1 15.9 (JPY tn) Partial monetization (Alibaba) 12.6 11.3 9.7 14.1 12.9 Alibaba 8.1 8.0 7.1 4.6 Sprint Yahoo Japan Others 1.3 Mar '13 Mar '14 Mar '15 Mar '16 Mar '17 Mar '18 May '18 (May 9t
Slide 55: Current Status of SoftBank Vision Fund and Delta Fund
Current Status of SoftBank Vision Fund and Delta Fund <Capital Deployment (as of March 31)> <USD bn> SoftBank Vision Fund Delta Fund SBG Third-party LP SBG Third-party LP 91.7 *1 6.0 *1 Total committed capital 28.1 *2 63.6 *1 4.4 1.6 *1 21.2 5.1 Total contribution *4 6.4 14.8 3.7 *3 1.4 ＜Main Invest
Slide 56: SBG: Price and Spread of JPY Notes
SBG: Price and Spread of JPY Notes Price Spread Z-spread, bps 106 450 Sub 2022 #2 2022 #48 2026 #50 Sub 2022 #2 2022 #48 2026 #50 Hyb 2021 #1 Hyb 2023 #2 Hyb 2021 #1 Hyb 2023 #2 105 400 104 350 103 300 102 250 101 200 100 150 99 100 98 50 16/4 16/7 16/10 17/1 17/4 17/7 17/10 18/1 18/4 16/4 16/7 16/1
Slide 57: SBG: Price and Spread of Foreign Currency Notes
SBG: Price and Spread of Foreign Currency Notes SBG executed consent solicitation/exchange offer in March and issued new notes in April. Price (USD denominated notes) Spread (USD denominated notes) Z-spread, bps 115 600 2022 USD 2025 USD Hyb 2027 USD 2027 USD 2028 USD 2023 USD 550 2025 USD 110 500 4
Slide 58: Sprint: Price and Spread
Sprint: Price and Spread Sprint senior notes price Sprint senior notes spread Z-spread, bps 120 1400 2024 USD 2024 USD 115 2021 USD 2021 USD 2025 USD 1200 2025 USD 110 2028 USD 2028 USD 2026 USD 2026 USD 1000 105 100 800 95 600 90 85 400 80 200 75 70 0 16/4 16/7 16/10 17/1 17/4 17/7 17/10 18/1 18/4
Slide 59: SBG Credit Rating Trend
SBG Credit Rating Trend Acquisition of Acquisition of Acquisition of Acquisition of Japan Telecom Vodafone K.K. Sprint Arm 14 13 A/A2 JCR (A－) 12 A－/A3 11 BBB+/Baa1 10 BBB/Baa2 9 BBB－/Baa3 S&P (BB＋) Outlook: Negative 8 BB+/Ba1 7 BB/Ba2 Moody’s (Ba1) 6 BB－/Ba3 5 B+/B1 4 2003 2004 2005 2006 2007 2008
Slide 60: SBG Bond Redemption Schedule
SBG Bond Redemption Schedule (JPY bn) Straight notes 1,305.6 Subordinated notes Hybrid Notes*2 Foreign currency-denominated senior notes*3 455.6 Foreign currency-denominated Hybrid Notes*2 *3 942.3 164.8 Foreign currency-denominated senior notes issued in April 2018*3 700.0 Early redemption of forei
Slide 61: SB Group: Companies sharing common vision
For Strategic Investments SB Group: Companies sharing common vision Telecom-centric → Strategic investment-centric (SoftBank Corp.) Companies with common vision SoftBank Vision Fund … Ping An (Ping An Good Doctor) HealthKonnect * Investment in OneWeb has not yet closed into SoftBank Vision Fund as o
Slide 62: Finance Strategy as Strategic Holding Company
Finance Strategy as Strategic Holding Company Investment asset value becomes a key for our credit Telecom Strategic holding business company - Investment asset value - Consolidated EBITDA Financial evaluation - Investment income - Consolidated FCF (dividend and divestment) - Loan to value (Net debt
Slide 63: FY2018 Finance Strategy
FY2018 Finance Strategy - Pursue optimal leverage as a strategic holding company Our Aim - Well-protected financial management to be invulnerable for any environmental change - Leverage index: Manage LTV lower than 35% Safety design - Cash position: Maintain a liquidity level that covers redemptions
Slide 64: Expected Financial Management (illustrative)
Expected Financial Management (illustrative) Maximize enterprise value while maintaining optimal leverage through appropriate LTV management Improve LTV for mid to long term period along with investment asset value Investment asset value 35% LTV % Net debt Time 64
Slide 65: (Reference)
(Reference) 65
Slide 66: Result of USD/EUR Notes Restructuring (detail)
Result of USD/EUR Notes Restructuring (detail) The covenants on 2015 Notes*1 were amended and now align with 2017 Notes*2. Approx. 81% of consents (incl. deemed consent via exchange offer) was provided to amend the covenants on 2015 Notes. Consent solicitation 2015 Notes 2015 Notes amended 5.375% 20
Slide 67: Sprint Debt Maturities
Sprint Debt Maturities Sprint Notes & Credit Facilities Spectrum Notes Secured Loans 8,903 （USD mil） 3,760 5,381 4,893 875 4,264 893 893 3,557 963 3,120 264 3,005 875 875 525 2,475 4,506 1,868 2,000 4,250 4,000 3,301 368 2,245 2,418 2,480 2,475 2,000 1,500 367 366 367 366 ~ FY18 FY19 FY20 FY21 FY22
Slide 68: Interest-bearing Debt: Breakdown by Long/Short and Fixed/Variable
Interest-bearing Debt: Breakdown by Long/Short and Fixed/Variable Interest-bearing debt: Interest-bearing debt: Long / short ratio Fixed / variable ratio (JPY bn) Long-term Short-term (JPY bn) Fixed Variable 15,855.4 15,855.4 14,142.9 18％ 14,142.9 29％ 19％ 11,511.5 30％ 11,511.5 21％ 33% 82％ 81％ 71％ 79
Slide 69: Domestic Telecommunications
Domestic Telecommunications 69
Slide 70: 1. Net Sales
<Domestic Telecommunications Segment> 1. Net Sales FY17 sales of JPY 3.2 tn, up JPY 36.1 bn YoY: telecom service revenue down JPY 16.5 bn, product and other sales up JPY 52.5 bn. Broadband revenue grew steadily, up JPY 56.0 bn YoY. Net sales Telecom service revenue Product and other sales Fixed-
Slide 71: 2. Operating Income/Adjusted EBITDA
<Domestic Telecommunications Segment> 2. Operating Income/Adjusted EBITDA FY17 segment income of JPY 683.0 bn, down JPY 36.6 bn (-5.1%) YoY. Operating Income Adjusted EBITDA <JPY bn> <JPY bn> 800 YoY change YoY change 719.6 -36.6 1,209.0 -30.9 688.4 683.0 -5.1% 1,163.3 1,178.1 1,200 -2.6% 68.1 90.
Slide 72: 3. Segment Income YoY Analysis
<Domestic Telecommunications Segment> 3. Segment Income YoY Analysis Broadband business drove topline growth. Mobile communications revenues decreased due to an increase in discount of Home Bundle Discount Hikari Set, a decrease in MBB by introduction of Ultra Giga Monster, Half Price Support fo
Slide 73: 4. Mobile Communications Subscribers and Churn Rate
<Domestic Telecommunications Segment> 4. Mobile Communications Subscribers and Churn Rate (main subscribers) Subscribers: increased 780K YoY, with smartphone net adds 1,690K for FY17. Churn rate: FY17 churn rate improved YOY by 0.02pp for main subscribers and by 0.03pp for handsets. FY17Q4 churn
Slide 74: 5. ARPU (main subscribers)
<Domestic Telecommunications Segment> 5. ARPU (main subscribers) YoY JPY +0 in Q4: Positive impact from retroactive adjustment of access charge offset adverse impact from higher mix of Y!mobile smartphones Service ARPU and Discount on ARPU improved YoY ARPU 6,500 <JPY> YoY change 5,200 560 550 5
Slide 75: 6. Broadband
<Domestic Telecommunications Segment> 6. Broadband 4.97mil SoftBank Hikari at FY17-end; steady growth of customer acquisition. 8.15mil subscribers under Home Bundle Discount Hikari Set; a significant increase. Cumulative subscribers Home Bundle Discount Hikari Set (number of connected lines) cum
Slide 76: 7. Capex / Free Cash Flow
<Domestic Telecommunications Segment> 7. Capex / Free Cash Flow FY17 Capex of JPY 340.4 bn, focusing on the expansion of service areas and improvement in LTE network quality. FY17 FCF was JPY 511.5 bn; adjusted FCF was JPY 554.7 bn. Capex*1 Free cash flow*3 <JPY bn> Depreciation*2 <JPY bn> Adj.
Slide 77: 8. Growth Strategy: Beyond Carrier
<Domestic Telecommunications Segment> 8. Growth Strategy “Beyond Carrier” Utilizing Advanced Intellect Bigdata IoT AI Customer New Base Business EC Fintech Robot Softbank Hikari Wireless Home Phone Otoku Line Cloud Security Differentiation/ Strengthening Relationship with Customers 77
Slide 78: 9. Discovering Further Growth Opportunities
<Domestic Telecommunications Segment> 9. Discovering Further Growth Opportunities SoftBank Vision Fund + Ping An HealthKonnect Deploy cutting-edge business models to Japan 78 Certain "SoftBank Vision Fund" investments described herein have not yet been acquired by SVF and are subject to pending regu
Slide 79: 10. New Business ~Examples~
<Domestic Telecommunications Segment> 10. New Business ~Examples~ 79
Slide 80: 11. FY2018 Forecast
<Domestic Telecommunications Segment> 11. FY2018 Forecast 1 Increase in revenue / profit 2 Generate stabilized FCF (JPY 500bn) *1 Promote “Beyond Carrier” strategy & 3 enhance collaboration with SVF 4 IPO preparation *1 Including the impact of proceeds from securitization of installment receivables
Slide 81: (Reference) Domestic Telecommunications Segment Breakdown of Net Sales
<Domestic Telecommunications Segment> (Reference) Domestic Telecommunications Segment Breakdown of Net Sales <JPY bn> FY2016 FY2017 Full Full Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Year Year Total net sales 761.8 792.8 846.1 793.1 3,193.8 755.7 773.3 878.0 823.0 3,229.8 Telecom service revenue 605.8 609.5 613.5 59
Slide 82: Definition and calculation method of principal operational data
<Domestic Telecommunications Segment> Definition and calculation method of principal operational data <Mobile Communications Service> 1. Subscribers Main subscribers: smartphones, feature phones, tablets, mobile data communications devices, Wireless Home Phone and others * Wireless Home Phone is a n
Slide 83: Sprint
Sprint 83
Slide 84: Q4 SoftBank Investor Briefing: FY 2017 Results
Q4 SoftBank Investor Briefing FY 2017 RESULTS May 9th, 2018 84 ©2017 Sprint. This information is subject to Sprint policies regarding use and is the property of Sprint and/or its relevant affiliates and may contain restricted, confidential or privileged materials intended for the sole use of the int
Slide 85: Cautionary Statement
Cautionary Statement SAFE HARBOR This release includes “forward-looking statements” within the meaning of the securities laws. The words “may,” “could,” “should,” “estimate,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “target,” “plan”, “outlook,” “providing guidance,” and si
Slide 86: Best Financial Results in Company History
Operating Expenses (CoS + SG&A) [1] Adjusted EBITDA* Dollars in Billions Dollars in Billions Best Financial Results in Company History [2] [2] [1] after adjusting for hurricane and other non-recurring charges Nearly $6B reduction in CoS and Highest in 11 years SG&A Operating Income/Loss Net Income/L
Slide 87: Fiscal Year 2017 Highlights
Fiscal Year 2017 Highlights Operating Income Net Income Transforming HIGHEST Achieved Net Income for the first time in Cost Structure 4 in company history eleven years consecutive years of Adjusted EBITDA* more than $1 billion of year-over-year HIGHEST reductions[1] in eleven years [1] after adjusti
Slide 88: Growing Connections
Growing Connections Postpaid Phone Net Adds Prepaid Net Adds FY15 FY16 FY17 FY15 FY16 FY17 1.4M 3 GROWTH consecutive years of IMPROVEMENT ©2017 Sprint. This information is subject to Sprint policies regarding use and is the property of Sprint and/or its relevant affiliates and may contain restricted
Slide 89: Average Download Speed Change
Average Download Speed Change1 Mar ‘17 to Mar ‘18 MOST IMPROVED Tri-Band Expand Outdoor Existing Sites LTE Footprint Small Cells & 800 MHz, 1.9 GHz, 2.5 GHz New Macro Sites Strand Mounts [1] Ookla’s analysis of Speedtest Intelligence data comparing March 2017 to March 2018 for all mobile results Mag
Slide 90: Positioned to Lead in Mobile 5G
Positioned to Lead in Mobile 5G ©2017 Sprint. This information is subject to Sprint policies regarding use and is the property of Sprint and/or its relevant affiliates and may contain restricted, confidential or privileged materials intended for the sole use of the intended recipient. Any review, us
Slide 91: Optimize & Expand Distribution
Optimize & Expand Distribution ENHANCING Digital Capabilities 500+ New Sprint Branded Stores DIGITAL this year CHANNELS PostpaidSales Up 30% year-over-year New 800 Boost Stores this year ©2017 Sprint. This information is subject to Sprint policies regarding use and is the property of Sprint and/or i
Slide 92: Revenue Stabilizing
Revenue Stabilizing Net Operating Revenues Postpaid Phone Average Billings per Dollars in Billions User (ABPU)* FY15 FY16 FY17 FY15 FY16 FY17 Wireless Service Rev Wireless Equip Rev Service Equipment Normalized for change in device insurance Consolidated Net Operating Rev ©2017 Sprint. This informat
Slide 93: Reducing Operating Expenses
Reducing Operating Expenses Operating Expenses Operating Expenses Dollars in Billions Dollars in Billions FY16 FY17 FY13 FY17 Cost of Services Selling, General & Administrative Cost of Services Selling, General & Administrative 4 CONSECUTIVE years of $1 billion or more of net reduction in CoS and SG
Slide 94: Improving Profitability
Improving Profitability Adjusted EBITDA* Operating Income Dollars in Billions Dollars in Billions FY15 FY16 FY17 FY15 FY16 FY17 HIGHEST Fiscal Year in 11 YEARS HIGHEST EVER ©2017 Sprint. This information is subject to Sprint policies regarding use and is the property of Sprint and/or its relevant af
Slide 95: Net Income/Loss
Net Income/Loss Net Income (Loss) Dollars in Billions (actual dollars) FY17 FY16 Change Basic EPS $1.85 ($0.30) $2.15 Tax Reform $1.77 N/A $1.77 FY15 FY16 FY17 [1] [1] Includes $7.1B non-cash benefit from tax reform 11YEARS Net Income for the first time in ©2017 Sprint. This information is subject t
Slide 96: Capex & Adjusted Free Cash Flow
Capex & Adjusted Free Cash Flow* Cash Capex[1] Adjusted Free Cash Flow* Dollars in Billions Dollars in Millions FY15 FY16 FY17 FY15 FY16 FY17 NETWORK INVESTMENT investment POSITIVE UP NEARLY 70% YEAR-OVER-YEAR for second consecutive year [1] excludes capitalized device leases ©2017 Sprint. This info
Slide 97: Fiscal Year 2018 Guidance
FISCAL YEAR 2018 Guidance Adjusted Cash EBITDA* Capex $11.3 billion to $5.0 billion to $11.8 billion $6.0 billion $11.6-$12.1B including the impact of the excluding new revenue recognition accounting leased devices standard ©2017 Sprint. This information is subject to Sprint policies regarding use a
Slide 98: SoftBank
SoftBank