Nomura Holdings, Inc. · TSE:8604
Nomura — Q3 FY2022/23 Earnings Presentation
34 slides from Nomura's earnings presentation, January 2023
Slide 1: Consolidated Results of Operations: Q3 overview
Good evening, this is Takumi Kitamura, CFO of Nomura Holdings. I will now give you an overview of our financial results for the third quarter of the fiscal year ending March 2023 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 (p. 2-3) © Overview of results (p. 4) © Business segment results (p. 5) © Retail (p. 6-8) © Investment Management (p. 9-10) © Wholesale (p. 11-13) © Non-interest expenses (p. 14) © Robust financial position (p. 15) © Consolidated balance sheet (p
Slide 3: Groupwide net revenue and income for the quarter
Groupwide net revenue for the quarter was 393.7 billion yen, up 24 percent from last quarter. As you can see on the right, income before income taxes increased 165 percent to 83.6 billion yen, underscoring a rebound in performance since bottoming out in the first quarter. Net income was 66.9 billion
Slide 4: Nine-month results to December
As I said, market uncertainty eased during the third quarter and investor risk appetite increased. But looking at the nine months compared to the same period the year before, market activity was generally sluggish across many product lines. Groupwide net revenue was roughly flat at 1,010.6 billion y
Slide 5: Highlights
Highlights (billions of yen, excluding EPS and ROE) Q0Q ‘YoY “YoY Net revenue 351.0 340.8 299.0 318.0 303.7 || 24% 12% 1% Non-interest expenses 270.9 291.3 287.3 286.5 310.1 8% 14% 4% Income (loss) before income 80.1 49.5 W7 31.5 83.6 165% 4% -28% taxes Net income (loss)* 60.3 31.0 17 16.8 66.9 4.0x
Slide 6: Net revenue and income (loss) before income taxes
Net revenue and income (loss) before income taxes (ditions of yen) FY2021/22 FY2022/23 Fy2i22 FY2223 oa YoY YoY Net revenue | Retail 87.4 70.5 1.4 725 | B10 } 12% -7% | 257.5 | 2249 f -13% Investment Management 40.1 10.4 76 26.2 | 57.0 } 118% 42% | 1379 | 90.7 | -34% Wholesale 2027 © 194.9 | 199.0 =
Slide 7: Retail results
Net revenue in Retail increased 12 percent to 81 billion yen. Income before income taxes grew 142 percent to 13.3 billion yen. By strengthening our segment based approach and providing detailed consulting services tailored to each client’s needs and the changing market conditions, we were able to in
Slide 8: Retail sales by product
Total sales for the quarter increased 7 percent to 4.9 trillion yen. Sales of stocks became more active each month as the market rebound improved investor sentiment and retail investors bought on the dip in December. US growth stock funds and high yield funds topped sales of investment trusts on the
Slide 9: Retail KPIs and recurring revenue assets
Net inflows of recurring revenue assets shown on the top left increased slightly to 7.6 billion yen as there was a large investment trust redemption by corporate clients. Excluding corporate clients, net inflows were 190 billion yen with contributions from discretionary investments, insurance and lo
Slide 10: Investment Management results
Net revenue increased 118 percent to 57 billion yen. As shown on the bottom left, business revenue, which represents stable revenues, increased by 5 percent. The asset management business remained solid and Nomura Babcock & Brown performance improved on the back of a recovery in the operating enviro
Slide 11: Assets under management and net inflows
As shown on the top left, assets under management were 64.7 trillion yen at the end of December, down 100 billion yen due mainly to market factors. Net inflows on the bottom left shows outflows of about 100 billion yen from the investment trust business due to 350 billion yen of outflows from ETFs.
Slide 12: Wholesale results
Net revenue declined 8 percent to 189.1 billion yen. As shown on the bottom left, Global Markets revenues slowed by 13 percent to 154.3 billion yen, mainly due to a slowdown in Rates and FX/EM. Investment Banking revenues increased 24 percent on a recovery in the Japan ECM business. Expenses were 19
Slide 13: Global Markets revenues
Net revenue declined 13 percent to 154.3 billion yen. Fixed Income dropped 25 percent to 86.7 billion yen. Macro Products had a particularly slow quarter. Although Rates revenues increased in EMEA for both the flow and structured businesses, Agency Mortgages in the Americas declined. FX/EM in AEJ sl
Slide 14: Investment Banking revenues
Net revenue increased 24 percent to 34.8 billion yen. Advisory remained solid despite a slowdown in global fee pools as M&A completed transactions, and equity private placement transactions in the Americas contributed to revenues. As you can see here, revenue from financing and solutions improved ma
Slide 15: Non-interest expenses
Groupwide non-interest expenses increased by 24 billion yen to 310.1 billion yen, of which about 30 percent is attributable to yen depreciation. Other factors include compensation and benefits being impacted by severance related expenses in Wholesale. Other expenses increased by 32 percent due to a
Slide 16: Financial position: Tier 1 capital and risk-weighted assets
As shown in the table on the bottom left, Tier 1 capital was 3.2 trillion yen, down 36 billion yen from the end of September due to lower FX translation value as the yen rose. Risk-weighted assets rose by 770 billion yen from the end of September to 17.9 trillion yen. The waterfall graph on the bott
Slide 17: Financial Supplement
Financial Supplement 16
Slide 18: Consolidated balance sheet
Consolidated balance sheet (billions of yen) Assets Liabilities Total cash and cash deposits 4,064, Short-term borrowings Total payables and deposits Total loans and receivables 5,001 Total collateralized financing Trading liabilities Total collateralized agreements 16,876 Other liabilities Long-ter
Slide 19: Value at risk
= Definition = From April 1, 2022, to December 31, 2022 (billions of yen) — 95% confidence level — Maximum: 6.8 ~— 1-day time horizon for outstanding portfolio ~ Minimum: = 2.7 — Inter-product price fluctuations considered — Average: 46 (billions of yen) Equity Interest rate 33 23 23 23 48 37 40 For
Slide 20: Consolidated financial highlights
1 Full year Quarter (billions of yen) (billions of yen) 200 8% 200 153.1 6 795 "=== Net income (loss) 143.0 | | atinbutable to Nomura‘? 10% — 180) sae Holdings, Inc. CNHI") e—————_="" shareholders 100 4% 100 5 38% "ROE (%) 3 J 50 b 2 50 310 1 02%. 168 ; . @ f oe Pramas Procava — 8@ 0 QQ Net revenue
Slide 21: Consolidated income
Full year Quarter (billions of yen) ‘Promo Frama | Fy2o2v22FY2022/23 Revenue Commissions 376.9 3323 826 75.2 70.4 68.2 715 Fees from investment banking 108.7 149.6 48.0 34.0 273 24.2 33.8 Asset management and portfolio service fees 230.0 270.0 69.9 68.9 68.3 69.0 67.0 Net gain on trading 310.0 368.8
Slide 22: Main revenue items
Full year Quarter (billions of yen) “Fr2naoras Fy 202t22 — Fy20242200FY2028/23 800 QQ 2 SQ Stock brokerage commissions 2623 236.4 57.3 53.1 48.4 48.5 52.6 Other brokerage commissions 14.3 18.0 48 5.5 48 47 43 Commissions for distribution of investment trusts 68.8 43.7 11.6 65 75 64 83 Other 31.6 34.
Slide 23: Income before income taxes by segment and region
Adjustment of consolidated results and segment results: Income (loss) before income taxes’ Full year Quarter (billions of yen) Retail Investment Management Wholesale Three business segments total Other ‘Segments total Unrealized gain (loss) on investments in equity securties held for operating purpo
Slide 24: Segment Other: income before income taxes
Income (loss) before income taxes’ Full year Quarter (billions of yen) 80 595 40 149 0 24 40 Net gain (loss) related to economic 11.5 AA 8.4 98 01 15 hedging Realized gain (loss) on investments in equity ios held ex operating pa 17 14 0.0 14 02 01 21.9 Equity in earings of afiliates 164 8 54 16.2 17
Slide 25: Retail related data
(billions of yen) ‘Commissions Of which, stock brokerage commission Of which, commissions for distribution of investment trusts Sales credit Fees from investment banking and other Investment tust administration fees and other Net interest revenue Non-interest expenses Income before income taxes Dome
Slide 26: Retail client assets
Retail client assets (trillions of yen) = Other 40) 1286 ro TA ps = 119.4 770178 = Foreign investment — 100 '™ Bond investment trusts 80 = | I i trusts 60 = Domestic bonds 40 = Foreign currency bonds 20 = Equities r [rvacwet Fvzcuz2) | Fyamvee | Fvaqzeas Mar ee Equities 82.3 75 79.7 775 75.7 74.0 74
Slide 27: Net inflows of cash and securities
Net inflows of cash and securities’ Full year Quarter = Corporates m individuals = Corporates Individuals 1,500 1,500 5 1,200 1,200 900 900 600 600 300 300 CJ LI | "| = 200 a | 600 600 -900 -900 -1,200 aaa" a uote «Preeti promerey) g ta ‘Corporates? 1,205 136 Corporates? -1,089 722 125 267 137 Indiv
Slide 28: Number of accounts
Number of accounts (womans “Framoat promvan = vmmavaz, zag Accounts with balance 5,329 5,348 5,362 5,648 5,354 5,359 5,352 Equity holding accounts. 2,927 2,955 2,949 2,955 2,958 2,957 2,950 NISA accounts opened (accumulated)' 4,791 1,589 1,839 1,589 1,598 1,609 1,625 Online service accounts 4,895 5,
Slide 29: Investment Management results and AUM by company
Full year Quarter cottons yen) “remozt prea ieee ee 111.9 119.9 315 311 30.7 29.9 314 49% DAN tr gainloss 512 28.1 86 211 23.1 37 25.6 - 3.0x Net revenue 163.2 148.0 401 10.1 76 262 57.0 NT7% 42.0% Non-interest expenses 721 76.5 198 18.9 19.3 206 237 14.8% 19.8% Income (loss) before income taxes 91.
Slide 30: Asset inflows/outflows by business
Asset inflows/outflows by business':? Full year Quarter (billions of yen) Investment trusts business 2,753 1,236 250 372 478 137 100 of which ETFs 2,241 683 15 383 323 5 347 Investment advisory and international 883 830 110 -180 928 57 Total net asset inflow 1,870 2,066 60 193 -450 226 44 Domestic p
Slide 31: Wholesale results and revenue breakdown
Full year Quarter (billions of yen) ae 8 ee Hae a ee ee Net revenue 61.4 703.1 202.7 = 1949 198.0 65 189.1 Nominterest expenses 27.1 628.6. 161.9 1879 1737 ©1853 «= 190.9 3.0% 17.9% Income (loss) before income taxes 643 74.5 40.8 37.0 253 20.2 1.9 : : Breakdown of Wholesale revenues Full year Quarte
Slide 32: Number of employees
Japan 15,330 15,213 15,299 15,213 15,503 15,384 15,282 Europe 2,769 2,820 2,817 2,820 2,811 2,869 2,908 Americas 2,152 2,257 2,181 2,257 2,252 2,358 2,392 Asia and Oceania’ 6,151 6,295 6,259 6,295 6,407 6,520 6,634 Total 26,402 26,585 26,556 26,585 26,973 27,131 27,216 1. Includes Powal office in in
Slide 33: Disclaimer
NOMURA 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
Slide 34: Nomura Holdings, Inc.
Nomura Holdings, Inc. Wwww.nomura.com