SoftBank Group Corp. · TSE:9984
SoftBank — Q1 FY2022 Earnings Presentation
30 slides from SoftBank's earnings presentation, Aug 10, 2022
Slide 1: Earnings Results for the Three-month Period Ended June 30, 2022
Earnings Results for the Three-month Period Ended June 30, 2022 Investor Briefing August 10, 2022 SoftBank Group Corp.
Slide 2: Disclaimers
Disclaimers This presentation provides relevant information about SoftBank Group Corp. (“SBG”) and its subsidiaries (including Arm Limited, together with SBG, the “Company”) and its affiliates (together with the Company, the “Group”) and does not constitute or form any solicitation of investment inc
Slide 3: Exchange rates and abbreviations
Exchange rates per JPY used for translation FY2021 FY2022 Average during quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1 USD 110.00 110.47 113.60 117.10 129.04 1 CNY 17.01 17.09 17.75 18.43 19.60 EOQ Jun 30 Sep 30 Dec 31 Mar 31 Jun 30 Sep 30 Dec 31 Mar 31 1 USD 122.39 136.68 1 CNY 19.26 20.38 Abbreviations Abbrev
Slide 4: How We See the Market Environment
How We See the Market Environment Stock market correction undergoing with inflation and rising interest rates 10 3.5 105 10 year NASDAQ 2 year 3.0% S&P500 9.5 100 ＋9.1% 3 -4.9% 9 95 8.5 8.6 8.5 2.9% 2.5 2.3% 90 8.3 8 7.9 -20.6% 85 2.3% 7.5 7.5 2 -9.1% 80 7 7.0 1.5 75 6.5 70 6 1 -29.5% 5.5 65 5 0.5 6
Slide 5: How We See the China-related Environment
How We See the China-related Environment Uncertainty remains; with both positives and negatives in U.S.–China tension and China’s regulatory environment ($) 10,000 Environment surrounding Chinese NASDAQ Golden tech firms Dragon China Index (HXC) $7,955.51 Positives $7,064.73 May: China’s Vice Premie
Slide 6: Achievements in FY22Q1: Defensive financial management
Achievements in FY22Q1: Defensive financial management Global economy • Interest rate hikes accelerate to curb inflation; risk of entering recession smoldering • Correction on tech stock continued in Apr-Jun, followed by a sign of bottoming out Current environment Geopolitical risks • Uncertaint
Slide 7: Accounting
Accounting
Slide 8: Consolidated Results
Consolidated Results (¥ B) FY21Q1 FY22Q1 Change Change % Net sales 1,479.1 1,572.0 92.9 6.3% Income before 1,292.5 -3,292.5 -4,584.9 ― income tax Net income (attributable to owners of the 761.5 -3,162.7 -3,924.2 ― parent) (Reference) Gain (loss) on investments 1,263.1 -2,834.4 -4,097.5 ― Investment
Slide 9: Change in Reportable Segments
Change in Reportable Segments From FY22Q1, the Latin America Funds segment has been integrated into the “SoftBank Vision Funds segment.” FY21 Investment SoftBank Business of SoftBank Arm Latin America Vision Funds Other Holding Companies Segment Segment Funds Segment Segment Segment SoftBank Latin A
Slide 10: Integration of LatAm Funds Segment into SVF Segment
Integration of LatAm Funds Segment into SVF Segment Before/After restatement B/S, P/L items for FY22Q1 (¥ B) SVF segment (after integration) FY21Q1 P/L Before After Change Gain on investments at Account Account 287.9 507.3 219.4 SoftBank Vision Funds presented presented (Former) in P/L in B/S Gain o
Slide 11: Segment Income: SoftBank Vision Funds
Segment Income: SoftBank Vision Funds (¥ B) P/L FY21Q1 FY22Q1 FY22Q1 Items Gain (loss) on investments at SoftBank Vision Funds 610.9 -2,933.8 Gain (loss) on investments at SVF1, SVF2, and 610.9 -2,935.0 SVF1 -¥1,313.0B, SVF2 -¥1,297.1B, LatAm Funds -¥324.9B LatAm Funds SVF1 -¥30.5B (mainly monetizat
Slide 12: Realized and Unrealized Gain (Loss) on Investments by Fund
(Reference) Realized Gain (Loss) on Investments and Unrealized Gain (Loss) on Valuation of Investments by Fund (¥ B) 1 Unrealized gain (loss) on valuation of investments* Realized gain Change in valuation Reclassified to Funds (loss) on for the fiscal year (FY22Q1) realized gain (loss) Items investm
Slide 13: Segment Income: Investment Business of Holding Companies
Segment Income: Investment Business of Holding Companies (¥ B) P/L item FY21Q1 FY22Q1 FY22Q1 Items Gain on investments at Investment Business of Holding Companies 741.4 111.2 Gain relating to settlement of prepaid forward contracts using Alibaba shares ― 97.3 Gain relating to a partial settlement of
Slide 14: Monetization of T-Mobile Shares
Monetization of T-Mobile Shares Number of shares held Procured (millions) Execution Transaction amount Deutsche timing T-Mobile ($ B) Telekom shares shares a Borrowings made using 106.3M T-Mobile shares pledged as collateral (margin loan) 4.38 Jul 2020 Number of shares held as of Jun. 30, 2021 106.3
Slide 15: T-Mobile Shares: Holding and Fair Values
T-Mobile Shares: The Company’s Holding (incl. Deutsche Telekom’s Unexercised Call Options) & Fair Values • In Apr 2022, the Company sold 21.2M FY20 FY21 FY22 T-Mobile shares, following Deutsche Jun 26 Q4-end Q1-end Q2-end Q3-end Q4-end Q1-end Telekom's partial exercise of its call options. $144.83 (
Slide 16: Deutsche Telekom Shares: Holding and Fair Values
Deutsche Telekom Shares: The Company’s Holding & Fair Values In Sep 2021, the Company FY21 FY22 acquired 225M Deutsche At execution Q2-end Q3-end Q4-end Ｑ1-end in Sep Telekom shares in return for the sale of T-Mobile shares. Deutsche Telekom share price €18.95 €17.67 €17.40 €16.93 $213.9M (¥27.6B) €
Slide 17: T-Mobile Shares: Fair Values of Contingent Consideration
T-Mobile Shares: Fair Values of Contingent Consideration (Ref.) Closing price on Aug. 8, 2022: $144.58 • Contingent T-Mobile share price $144.83 consideration: $134.85 $134.54 $127.76 $128.35 The Company’s right $125.29 to acquire 48.8M $114.36 $115.98 T-Mobile shares for $104.15 no additional $551.
Slide 18: Derivative Gain (Loss) on Alibaba Prepaid Forward Contracts
Derivative Gain (Loss) on Alibaba Prepaid Forward Contracts (Quarterly Trend) $293.98 Alibaba share price (at each quarter-end) (Impact on P/L) $226.78 $232.73 (¥ B) FY22Q1 $215.70 $226.73 Income before -333.6 $148.05 income tax (-$2.6B) $118.79 $108.80 $113.68 Net income -248.0 (-$1.9B) Day 1 gain
Slide 19: Consolidated P/L Summary (IFRSs)
Consolidated P/L Summary (IFRSs) (¥ B) P/L item FY21Q1 FY22Q1 Change Gain on investments at Investment Business of Holding Companies Net sales +1,479.1 +1,572.0 +92.9 (consolidated basis): +¥111.2B (See page 7 for details) • Loss on investments at asset management subsidiaries: -¥67.6B Gross profit
Slide 20: Consolidated B/S Summary (IFRSs) – Non-current assets
Consolidated B/S Summary (IFRSs) – 1 (¥ B) 1 Cash and cash equivalents: ¥6,070.7B（+¥901.7B） B/S item Main items Mar 2022 Jun 2022 Change SBG ¥3,578.0B（+¥1,075.4B） 10,028.6 10,398.2 +369.6 -¥351.2B decrease in derivative financial assets related to Alibaba prepaid Current assets 1 6,070.7 forward con
Slide 21: Investment Securities on Consolidated B/S
Investment Securities on Consolidated B/S (Main Investments) (¥ B) Mar 2022 Jun 2022 Change Outline Investment securities* 3,085.4 2,939.8 -145.6 FVTPL 2,587.6 2,469.5 -118.1 Mainly due to the sale of 21.2 million T-Mobile shares to Deutsche Telekom T-Mobile 957.1 731.4 -225.7 due to Deutsche Teleko
Slide 22: Consolidated B/S Summary (IFRSs) – Liabilities
Consolidated B/S Summary (IFRSs) – 2 (¥ B) B/S 1 Main items Mar 2022 Jun 2022 Change SBG item Borrowings (current and non-current) -¥555.8B 12,381.5 11,206.7 -1,174.8 Repaid borrowings under commitment lines: -$4.5B 1 Interest-bearing debt 7,328.9 6,587.8 -741.0 Corporate bonds (current and non-curr
Slide 23: Consolidated B/S Summary (IFRSs) – Equity
Consolidated B/S Summary (IFRSs) – 3 (¥ B) B/S Items Mar 2022 Jun 2022 Change item 11,707.8 10,174.6 -1,533.2 1 Net loss attributable to owners of the parent: -¥3,162.7B Common stock 238.8 238.8 ― Capital surplus 2,634.6 2,644.9 +10.3 2 Shares repurchased under the total of up to ¥1 trillion authori
Slide 24: Impact of the Weaker Yen on P/L & B/S (Illustration)
Impact of the Weaker Yen on P/L & B/S (Illustration) P/L B/S Entities Components Foreign exchange Exchange differences gain (loss) from translation Foreign currency- denominated cash and cash equivalents/ SBG stand-alone + Loans receivable Foreign exchange gain Subsidiaries conducting (excl. investm
Slide 25: Impact of the Weaker Yen in FY22Q1
Impact of the Weaker Yen in FY22Q1 Foreign exchange loss in consolidated P/L for FY22Q1: -¥820.0B (of which 90% from SBG stand-alone) SBG stand-alone: Foreign exchange loss of -¥1,075.7B related to foreign currency-denominated borrowings from Group companies, -¥132.3B related to foreign currency-den
Slide 26: Consolidated C/F Summary (IFRSs)
Consolidated C/F Summary (IFRSs) (¥ B) C/F item FY21Q1 FY22Q1 Change Primary details for FY22Q1 C/F from operating activities: -¥366.6B yoy Subtotal of cash flows from • Decrease in SB Northstar’s cash inflows: -¥663.2B C/F from +413.0 • Decrease in income taxes paid (cash outflows): +¥449.9B operat
Slide 27: Appendix
Appendix
Slide 28: Co-investment Program to SVF2: Related Party Transaction
Co-investment Program to SVF2: Related Party Transaction Masayoshi Equity interests (third-party interests) SBG Son* 1 FY22Q1-end: $682M (¥93.2B) FY21-end: $2,207M (¥270.1B) Equity interests: 17.25% (B) (A) Distribution: $173M Equity acquisition amount: $2,923M 100% (Return of capital) (i) Acquisiti
Slide 29: How the Weaker Yen Moves Fair Values of Investment Assets
How the Weaker Yen Moves Fair Values of Investment Assets at Foreign Subsidiaries/Associates Year-end rate Year-average rate Year-end rate ¥110/$ ¥115/$ ¥120/$ Equity (B/S): Changes in fair values Increase/decrease in of investment assets exchange differences at foreign from the translation of subsi
Slide 30: Main intangible assets
Breakdown of Goodwill/Intangible Assets (¥ B) Change B/S Main items Mar 2022 Jun 2022 Outline Item Amorti- Changes in Others zation FX rate 4,897.9 5,242.0 * Arm 2,898.1 3,236.5 ― +338.4 ― Goodwill SBKK 907.5 907.5 ― ― ― LINE 630.6 630.6 ― ― ― ZOZO 212.9 212.9 ― ― ― Technologies 357.7 387.7 Main Arm