Nomura Holdings, Inc. · TSE:8604
Nomura — Q2 FY2023/24 Earnings Presentation
34 slides from Nomura's earnings presentation, October 2023
Slide 1: CFO overview of first half and second 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 half and second quarter of the year ending March 2024 using the document titled Consolidated Results of Operations. Please turn to page two.
Slide 2: Presentation and Financial Supplement contents
Presentation Financial Supplement Executive summary (P2-3) © Overview of results (P4) © Business segment results (P5) © Retail (P6-8) © Investment Management (P9-10) © Wholesale (P11-13) © Non-interest expenses (P14) Robust financial position (P15) © Consolidated balance sheet (P17) e Value at risk
Slide 3: First half results overview
Groupwide net revenue for the first half period increased 16 percent year on year to 716.7 billion yen. Income before income taxes grew 138 percent to 103 billion yen, while net income rose 3.2 times to 58.6 billion yen. Diluted EPS was 18.62 yen and ROE was 3.6 percent. The six-month period started
Slide 4: Second quarter results
The percentages quoted from now all refer to quarter-on-quarter changes. Net revenue increased 5 percent to 367.8 billion yen. Income before income taxes grew 23 percent to 56.7 billion yen. Net income was up 51 percent at 35.2 billion yen. EPS was 11.21 yen and ROE was 4.3 percent. Three segment in
Slide 5: Overview of results
393.7 324.9 348.9 367.8 5% 16% (bilions of yen, excluding EPS and ROE) = at omen | ee ee ee ee oe | nS 83.6 227 46.3 56.7 | 23% 80% 43.2 103.0 | 138% moment | 16.8 66.9 74 23.3 35.2 | 51% 110% 18.5 58.6 | 3.2x oe | Y5.41 Y21.51 Y2.34 Y7.40 Y11.21 | 51% 107% Y5.91 ‘Y18.62 3.2x
Slide 6: Business segment results
Net revenue and income (loss) before income taxes 15.6 87.3 ELE) (bilions of yen) | ‘FY2022/23 72.5 81.0 75.3 191.0 33% 26.2 57.0 378 716 112% 205.5 189.1 178.8 394.9 2% 18 207 49 16 - --318.0 393.7 324.9 716.7 16% 55 13.3 98 52.0 5.0x 56 333 16.4 268 : 20.2 19 14.2 104 -77% 21 595 15.7 154 - equity
Slide 7: Retail net revenue and income
Net revenue in Retail increased 7 percent to 98.9 billion yen and income before income taxes grew 27 percent to 29 billion yen, both representing the strongest results in six years since the October to December quarter in 2017. As I mentioned, the reorganization we did earlier in the year lead to mo
Slide 8: Retail sales of stocks, bonds and investment trusts
This quarter we have changed how we calculate bond sales. We now exclude repo transactions for corporate clients because they were clouding true performance given they are short term and transaction values fluctuate widely each quarter. Figures from last quarter and earlier have been reclassified to
Slide 9: Retail recurring revenue assets and clients
The top left shows net inflows of recurring revenue assets of 128.6 billion yen. Recurring revenue assets shown on the top right were roughly flat at 20.2 trillion yen, but remained high at over 20 trillion yen throughout the quarter, driving strong growth in recurring revenue as represented by the
Slide 10: Investment Management results
Net revenue increased 70 percent to 45.1 billion yen and income before income taxes grew 6.4 times to 23.2 billion yen. The bottom left show stable business revenue at 33.4 billion yen, the highest since the division was established in April 2021. Investment gain/loss was 11.7 billion yen, reboundin
Slide 11: Assets under management and net inflows
As you can see on the top left, assets under management at the end of September stood at 76.5 trillion yen, a record high for second straight quarter. The bottom left shows net inflows of around 600 billion yen with the investment trust business accounting for 480 billion yen. ETFs such as the Nikke
Slide 12: Wholesale results
Net revenue increased 7 percent to 204.1 billion yen. While Fixed Income was roughly unchanged from last quarter, Equities and Investment Banking both reported stronger revenues. Expenses increased mainly due to yen depreciation, up only 4 percent thanks to our cost reduction efforts. As a result, i
Slide 13: Global Markets revenues
Global Markets net revenue increased 6 percent to 170.7 billion yen. Fixed Income revenues were roughly unchanged at 96.9 billion yen. Macro Products represented an improvement in FX/EM in AEJ and EMEA, while Rates revenues slowed in EMEA and the Americas on an uncertain outlook and Japan declined f
Slide 14: Investment Banking revenues
Net revenue increased 10 percent to 33.4 billion yen, driven by Financing and Solutions. As shown on the right, we executed a number of Japan-related ECM transactions such as an international secondary offering for Socionext and a public offering/Euroyen convertible bond by JFE Holdings. In DCM, we
Slide 15: Non-interest expenses
Groupwide expenses increased 3 percent to 311 billion yen. Compensation and benefits were up 5 percent at 167.1 billion yen. The main factors behind the increase were yen depreciation, booking of severance-related expenses in international business and higher bonus provisions for Retail due to stron
Slide 16: Financial position and closing remarks
The table on the bottom left shows Tier 1 capital of 3.4 trillion yen and risk-weighted assets of 18.2 trillion yen, both up from the end of June. As a result, our Tier 1 capital ratio at the end of September was 18.6 percent and our CET1 capital ratio was 16.5 percent, roughly unchanged from the en
Slide 17: Financial Supplement
Financial Supplement 16
Slide 18: Consolidated balance sheet
Consolidated balance sheet (billions of yen) Assets Total cash and cash deposits Total loans and receivables Total collateralized agreements Total trading assets and private equity and debt investments’ Total other assets’ Total NHI shareholders’ equity Total assets Noncontrolling interest 1. Includ
Slide 19: Value at risk
= Definition = FromApril 1, 2023, to September 30, 2023 (billions of yen) — 95% confidence level - Maximum: 68 — 1-day time horizon for outstanding portfolio — Minimum: 46 — Inter-product price fluctuations considered — Average 56 (billions of yen) Equity Interest rate 23 47 37 4.0 47 46 3.5 Foreign
Slide 20: Consolidated financial highlights
1 Full year Quarter (billions of yen) 200 ‘mmm Net income (loss) attributable to Nomura Holdings, Inc. CNHI") shareholders ROE (%) 0 0% (billions of yen) 8% Net revenue 1,363.9 1,335.6 318.0 393.7 324.9 348.9 367.8 Income (loss) before income taxes 226.6 149.5 31.5 83.6 227 46.3 56.7 Net income (los
Slide 21: Consolidated income
Full year Quarter (ons of yer enim rae 4 MIM Frm Revenue Commissions 332.3 279.9 68.2 75 63.8 82.8 88.9 Fees from investment banking 149.6 113.2 24.2 33.8 28.0 311 38.6 Asset management and portfolio service fees 270.0 2717 69.0 67.0 67.4 718 76.7 Net gain on trading 368.8 563.3 160.9 142.14 118.3 1
Slide 22: Main revenue items
Full year Quarter 236.4 1908 48.5 526 413 55.2 58.3 18.0 17.9 47 43 40 40 4.0 43.7 30.3 64 83 8.0 13.4 14.0 343 41.0 86 122 104 10.1 12.6 332.3 2799 68.2 75 63.8 828 88.9 Equity underwriting and distributi 33.4 18.9 16 84 54 45 13.1 Bond underwriting and distribution 298 211 45 45 54 53 52 M&A / Fin
Slide 23: Income by segment and region
Adjustment of consolidated results and segment results: Income (loss) before income taxes Full year Quarter (lions of yen) ryan vz 59.2 33.5 55 13.3 98 229 29.0 Investment. 15 43.5 5.6 33.3 16.4 3.6 23.2 Wholesale 745 294 202 19 14.2 24 8.3 Three gt total 205.2 106.4 H2 447 11.9 28.7 60.5 Other 158
Slide 24: Segment Other
Income (loss) before income taxes Full year Quarter (billions of yen) 90 73.4 60 59.5 30 15.8 457 219 21 0 65 -30 "Net gain (loss) related to economic 99 48 01 15 63 34 29 Realized gain (loss) on investments in equity ities held for "1 14 284 01 21.9 62 82 0.0 Equity in ings of affiliates 36.8 477 9
Slide 25: Retail related data
Full year Quarter 1385 H2 294 Commissions 1125 262 413 419 1.6% 3% Ofutich steck bestamage: G7 509 122 B4 134 194 18 18% BT Of which, commissions for distribution of trusts 435 302 64 83 80 134 13.5 0.9% 110.5% Sales credit 40 42 109 122 106 128 149° 168% 3% Fees fom investment banking and other 190
Slide 26: Retail client assets
Retail clientassets (tillions of yen) : 140 1333 es 122.1 1222 4177 1175 ‘= Foreign investment 18 _= 100 ‘= Bond investment trusts 80 '® Stock investment trusts 60 = Domestic bonds 40 — 9 = Equities 0 Pyaoza@3 Fyne Ge ihe iar a ae 74.0 144 54 52 ss rs ai 129 129 13.2 133 33 98 97 10.2 113 11.2 72 74
Slide 27: Net inflows of cash and securities
Net inflows of cash and securities" (billions of yen) Full year Quarter =Corpordes s individuals =Caporates #indwviduals 1,200 1,200 900 900 600 600 300 300 ; : a os © ii 300 -300 600 600 “Praveize Frat — 2 QQ Corporates* “136 282 267 137 ar 108 331 Individuals® 488 438 -369 259 173 106 26 Total 361
Slide 28: Number of accounts
Number of accounts (thousands) — Fy2o2t22 Fy2qza23v0@23 ROSA Accounts with balance 5,348 5,353 5,359 5,352 5,353 5,395 5,396 Equity holding accounts 2,955 2,963 2,957 2,950 2,963 2.943 2,962 NISA accounts opened (accumulated)" 1,589 1,632 1,609 1,625 1,632 1,681 1,699 Online service accounts 5,067 5
Slide 29: Investment Management related data
Full year Quarter —FY200223 02 FY 2023/2400 comonsotven) Pramze Frames — aq gg ng YOY revenue 119.9 120.7 29.9 4 287 325 33.4 27% 11. gain/loss 28.1 79 37 25.6 94 60 11.7 - - Net revenue 148.0 128.6 26.2 57.0 78 26.5 45.1 70.1% 724% Non-interest expenses 76.5 85.1 206 237 215 22.9 21.9 AMG 6.2% Inco
Slide 30: Asset inflows/outflows by business
Asset inflows/outflows by business‘? Full year Quarter Investment trusts business 1,236 156 137 -100 358 649 405 of which ETFs 683 250 5 aT 224 2 266 vestimentary an 830 916 89 57 134 1,064 118 Total net asset inflow 2.066 -760 226 4 -492 1713 593 (ritions otyen) | Fyaozwazrvaozzza 0 Fyzomas zz Dome
Slide 31: Wholesale related data
Full year Quarter (billions of yen) ee ee rae — 2 QQ Net revenue 703.1 205.5 189.1 178.8 190.9 204.1 Non-interest expenses 628.6 743.0 185.3 190.9 193.1 188.7 195.8 3.1% 5.1% Income (loss) before income taxes 74.5 294 20.2 19 14.2 24 8.3 3.9% 59.1% Breakdown of Wholesale revenues Full year Quarter (
Slide 32: Number of employees
Japan 15,213 15,131 15,384 15,282 15,131 15,382 15,158 Europe 2,820 2,937 2,869 2,908 2,937 2,971 2,993 Americas 2,257 2,387 2,358 2,392 2,387 2,426 2,486 Asia and Oceania’ 6,295 6,320 6,520 6,634 6,320 6,465 6,492 Total 26,585 26,775 27,131 27,216 26,775 27,244 27,129 1. Includes Powai office in In
Slide 33: 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 sell, sales, solici
Slide 34: Nomura Holdings, Inc.
Nomura Holdings, Inc. www.nomura.com