Nomura Holdings, Inc. · TSE:8604
Nomura — Q1 FY2002.3 Earnings Presentation
34 slides from Nomura's earnings presentation, Jul 30, 2001
Slide 1: Consolidated Results of Operations (Three months ended June 30, 2001)
Consolidated Results of Operations (Three months ended June 30, 2001) Nomura Securities July 2001 1 This is a summary of the presentation on consolidated results of operations for the three months ended June 30, 2001. Date: July 30, 2001 (Monday) Place: Nihonbashi Headquaters of Nomura Securities Co
Slide 2: Outline of the Presentation
Outline of the Presentation « Review of Operations ! Wholesale Activities ! Consolidated Financial Summary 4 – Global Fixed Income 17 ! Commissions 5 – Global Equity 18 ! Net Gain on Trading 9 – Global Investment Banking 19 ! Selling, General and Administrative Expenses 10 ! Asset Management Busines
Slide 3: Review of Operations
Review of Operations NOMURA
Slide 4: Consolidated Financial Summary under Japanese GAAP
Consolidated Financial Summary under Japanese GAAP Three Months ended June 30, 2001 « Operating Results ! Net Operating Revenue 146.2 billion yen, down 26%* ! Selling, General and Administrative Expenses 118.7 billion yen, down 7%* ! Ordinary Income 36.7 billion yen, down 51%* ! Net Income 19.0 bill
Slide 5: Commissions (1): Brokerage Commissions
Commissions (1) Brokerage Commissions Down (Billions 12% of yen) « Individual equity agency transaction value* 35 1.0 33.4 29.4 (monthly average) 0.7 0.4 ! 4.9 trillion yen (up 5%) 30 0.5 10.4 25 8.6 « Retail equity brokerage commissions** ! 20.0 billion yen (down 7%) 20 15 10 21.3 20.0 5 0 FY01.3 (
Slide 6: Commissions (2): Underwriting Commissions
Commissions (2) Underwriting Commissions / Commissions from Offerings and Subscriptions « Stagnant equity primary markets (Billions of yen) ! IPO * 20 ! Market: 111.9 billion yen (down 67%) 17.9 Down ! Nomura: 4.0 billion yen (down 97%) 0.1 ! Nomura’s share: 4% 47% ! PO * 15 ! Market: 77.6 billion y
Slide 7: Commissions (3): Investment Trusts Offerings and Subscriptions
Commissions (3) Commissions from Offerings and Subscriptions (Investment Trusts) « Domestic distribution volume of (Billions of yen) down investment trusts (consolidated) 17% 10 9.4 ! Total: 7.8 ! 6.2 trillion yen (up 9%) 8 ! Bond investment trusts: ! 5.4 trillion yen (up 9%) ! Stock investment trus
Slide 8: Commissions (4): Other Commissions
Commissions (4) Other Commissions (Billions of yen) Down 50 45.9 19% « Change of product character of Medium-term Government Securities Fund 4.9 1 37.1 ! Medium-term Government Securities Fund 40 3.7 ! Assets under management (NAM) 2.9 2.4 0.3 2.6 trillion yen (3.6) 4.3 30 ! Increase of client asset
Slide 9: Net Gain on Trading
Net Gain on Trading « Equity Trading (Billions of yen) ! Block trades 90 86.3 2.3 Down 80 13.0 47% « Bond Trading 70 ! MTN 8.2 ! Bonds denominated in foreign currencies 60 45.8 50 5.8 40 13.7 30 62.8 20 27.1 10 0 -0.8 FY01.3 (1/4) FY02.3 1Q -10 Equity Fixed income Principal finance Others 9 This pag
Slide 10: Selling, General and Administrative Expenses
Selling, General and Administrative Expenses « Compensation and Benefits Down (Billions ! Decrease of Bonus of yen) 7% 140 128.1 ! FY02.3 1Q 62.6 billion yen (down 7%) 7.0 118.7 4.1 120 2.1 8.9 1.8 « IT related expenses 9.6 100 15.9 16 ! FY01.3 49.2 billion yen 6.2 ! FY02.3 1Q 13.4 billion yen (up 9
Slide 11: Cost Structure
Cost Structure « Asset Management related Fees / Fixed « Breakdown of Compensation and Type Expenses Benefits (Billions ! FY02.3 1Q 48% of yen) ! Asset Management related Fees: 40 38.9 Fixed type 30.4 billion yen (down 19%) compensation and benefits ! Fixed Type Expenses: 63.3 billion yen (up 4%) 34
Slide 12: Review of Business
Review of Business Securities Businesses Asset Management Businesses 12 12
Slide 13: Retail Activities in Japan (1): Client Assets
Securities Businesses: Retail Activities in Japan (1) Client Assets Retail Client Assets Net Asset Accumulation (monthly average) (Trillions (Billions of yen) 27.8 30 of yen) 26.5 26.6 26.9 26.5 800 727.1 684.2 25 4.9 5.1 4.8 4.7 4.8 19.7 600 20 4.8 9.4 9.6 10.4 10.3 11.9 15 388.7 400 7.1 10 238.8 2
Slide 14: Retail Activities in Japan (2): Investment Trusts
Securities Businesses: Retail Activities in Japan (2) Investment Trusts Distribution Volume of investment Trusts* « Distribution Volume of Major Investment Trusts* (Billions of yen) Bond Investment Trusts (Open) 3,000 ! Long-term Bond Investment Trusts: 488.3 billion yen 2,500 ! MMF: 1,300.3 billion
Slide 15: Retail Activities in Japan (3): Nomura Cash Management Service
Securities Businesses: Retail Activities in Japan (3) Nomura Cash Management Service (NCMS) Number of NCMS accounts, new account openings and transferred accounts through Japan Securities Depository Center (Thousands of accounts) 60 3,000 49 2,539 50 2,395 2,500 43 2,169 40 1,903 2,000 1,665 30 37 1
Slide 16: Retail Activities in Japan (4): Online Trading
Securities Businesses: Retail Activities in Japan (4) Online Trading Nomura Home Trade (Online Trade Accounts) (As of the end of quarter) (Thousands of accounts) Market Share 30.5% (end of June 2001)* 700 686 60% 584 600 50% 500 461 38% 40% 34% 400 32% 349 30% 283 300 26% 18% 25% 14% 15% 20% 200 8%
Slide 17: Wholesale Activities (1): Global Fixed Income
Securities Businesses: Wholesale Activities (1) Global Fixed Income Share in JGB Auction Share in Secondary Trading 30 16% 16% 15% 400 16% 14% 14% 14% 14% 14% 12% 350 15% 15% 14% 25 12% 12% 12% 13% (Trillions 12% 300 271 10% (Trillions 10% of20yen) 248 8% of250 yen) 226 217 8% 14 195 15 14 6% 200 18
Slide 18: Wholesale Activities (2): Global Equity
Securities Businesses: Wholesale Activities (2) Global Equity Net Gain on Equity Trading Off-floor / Off-exchange Trading Share* (Billions (non-consolidated) of yen) 30 30% 70 65.5 25% 25 24% 25% 60 (Trillions 22% 51.7 of yen) 19% 19% 19 18 18% 50 20 18 20% 16 38.5 40 15 14 15% 11 30 27.2 10 10% 21.
Slide 19: Wholesale Activities (3): Equity Underwriting
Securities Businesses: Wholesale Activities (3) Global Investment Banking - Equity Underwriting Japanese Equity: Japanese Equity: IPOs Primary and Secondary Offerings 2,000 48% 60% 600 60% (Billions (Billions 42% 43% of yen) 36% of yen) 40% 40% 1,500 16% 20% 400 20% 1,116.8 339.6 4% 1,000 908.7 0% 0
Slide 20: Wholesale Activities (4): Bond Underwriting
Securities Businesses: Wholesale Activities (4) Global Investment Banking - Bond Underwriting Retail-targeted Japanese Corporate Japanese Corporate Samurai Bonds Euro Yen Bonds Bonds Bonds 54% 52% 44% 35% 30% 27% 24% 22% 19% 18% 19% 18% FY00.3 FY01.3 FY02.3 FY00.3 FY01.3 FY02.3 FY00.3 FY01.3 FY02.3
Slide 21: Wholesale Activities (5): Financial Advisory
Securities Businesses: Wholesale Activities (5) Global Investment Banking - Financial Advisory « M&A/Financial Advisory ! M&A ranking (Jan-Jun, 2001) #2* M&A/Financial Advisory Fees ! Major deals Nomura advised ! Nippon Columbia - Ripplewood Holdings ! Nippon Life Insurance - Nissay Dowa General (Bi
Slide 22: Asset Management Businesses (1): Nomura Asset Management
Asset Management Businesses (1) Nomura Asset Management Assets under Management – NAM* Market Share - NAM** (Trillions of yen) 40% 25 21.9 35% 33% 20.0 21.0 32% 19.9 0.2 0.2 0.2 29% 20 0.1 4.5 30% 28% 4.9 25% 30% 14.7 5.6 4.9 28% 15 0.0 26% 4.8 20% 20% 23% 18% 18% 10 13.3 14.5 21% 10.7 11.7 7.8 17%
Slide 23: Asset Management Businesses (2): Defined Contribution Pension Plan
Asset management Businesses (2) Defined Contribution Pension Plan Introduction Support Nomura IBJ Investment Services Investment Education Products (Fund of funds and others) Nomura Fund Research Nomura Securities and Technologies Nomura Asset Management DC Plan Administration Trust Nomura DC Planni
Slide 24: Reorganization into a Holding Company Structure
Reorganization into a Holding Company Structure 24 24
Slide 25: Objectives of Reorganization
Objectives of Reorganization To establish a financial services group whose core business is securities businesses To implement a comprehensive business strategy To promote a group management philosophy which emphasizes the importance of enhancing shareholder value. « Group management strengthening !
Slide 26: Appendix
Appendix ! Quarterly Revenue Breakdown ! Market Share: ! Client Assets (non-consolidated) Individual Equity Agency Transactions ! Retail Clients’ Assets ! Value at Risk ! Number of Accounts ! NAM’s Assets under Management ! Nomura Home Trade (online trade) ! Number of Employees ! Nomura Cash Managem
Slide 27: Quarterly Revenue Breakdown
Quarterly Revenue Breakdown (Billions of yen) 250 200 150 100 50 0 FY01.3 1Q 2Q 3Q 4Q FY02.3 1Q Net gain on trading 106.1 87.3 37.7 114.1 45.8 Fees from investment banking* 3.8 4.3 4.7 6.2 4.6 Underwriting commissions** 16.3 25.6 20.0 9.7 9.5 Subscription com. (Inv. Trusts)*** 13.9 12.5 5.0 6.3 7.8
Slide 28: Client Assets (non-consolidated)
Client Assets (non-consolidated) (Trillions of yen) 70 60 50 40 30 20 10 0 Mar. Jun. Sep. Dec. Mar. Jun. Sep. Dec. Mar. Jun. Sep. Dec. Mar. Jun. 98 98 98 98 99 99 99 99 00 00 00 00 01 01 Total client assets 47.4 46.6 43.4 43.7 49.5 54.8 57.6 60.6 62.4 61.8 58.3 54.4 56.8 57.5 Other 0.3 0.2 0.2 0.1 0
Slide 29: Retail Clients' Assets
Retail Clients’ Assets (Trillions of yen) 30 25 20 15 10 5 0 Mar. Jun. Sep. Dec. Mar. Jun. Sep. Dec. Mar. Jun. Sep. Dec. Mar. Jun. 98 98 98 98 99 99 99 99 00 00 00 00 01 01 Total client assets 18.2 18.7 18.1 18.4 19.7 21.5 22.9 26.2 26.5 27.0 26.6 26.5 26.9 27.8 Other 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Slide 30: Number of Accounts
Number of Accounts (the end of the month) Nomura Home Trade (online trade accounts) 686 700 (Thousands of accounts) 584 600 461 500 349 400 283 300 188 200 109 61 100 4 6 7 8 9 17 0 Mar.98 Jun.98 Sep.98 Dec.98 Mar.99 Jun.99 Sep.99 Dec.99 Mar.00 Jun.00 Sep.00 Dec.00 Mar.01 Jun.01 Nomura Cash Manageme
Slide 31: Individual Equity Agency Transactions
Individual Equity Agency Transactions* (Trillions of yen) 15 30% 25% 10 20% 15% 5 10% 5% 0 0% FY00.3 FY01.3 FY02.3 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Market (monthly average) 5.6 7.2 9.7 10.4 6.3 5.1 3.7 3.7 4.9 Nomura's share 16% 17% 21% 20% 25% 21% 19% 16% 17% Source: Tokyo Stock Exchange, Nomura 31 * Thr
Slide 32: NAM's Asset under Management
NAM’s Asset under Management (Trillions of yen) 25 20 15 10 5 0 Mar. Jun. Sep. Dec. Mar. Jun. Sep. Dec. Mar. Jun. Sep. Dec. Mar. Jun. 98 98 98 98 99 99 99 99 00 00 00 00 01 01 Total 14.1 15.1 14.1 14.1 14.7 17.7 17.6 17.9 19.9 21.7 20.0 20.3 21.0 21.9 Investment advisory assets (overseas) 1.2 1.1 1.
Slide 33: Value at Risk
Value at Risk « Definition « From Apr. 01 to Jun. 01 ! 99% confidence level ! Maximum: 3.9 billion yen ! 1-day holding period ! Minimum: 2.9 billion yen ! Average: 3.3 billion yen Mar.00 Jun.00 Sep.00 Dec.00 Mar.01 Jun.01 Equity 1.7 2.8 2.6 2.3 3.0 2.5 Interest Rate 1.5 2.1 1.8 1.9 2.7 2.2 Foreign E
Slide 34: Number of Employees
Number of Employees 20,000 15,000 10,000 5,000 0 Mar. 98 Mar. 99 Mar. 00 Mar. 01 Jun. 01 Total 16,611 15,803 14,823 14,393 14,998 Asia / Oceania 557 517 488 486 473 Americas 1,258 1,145 983 835 874 Europe 2,290 1,769 1,319 1,370 1,380 Japan (FA*) 2,242 2,207 2,173 2,195 2,260 Japan (Excluding FA*) 1