Monex Group, Inc. · TSE:8698
Monex — H1 FY2006 Earnings Presentation
28 slides from Monex's earnings presentation, Oct 24, 2005
Slide 1: Financial Results First Half of Fiscal Year Ending March 31, 2006
Financial Results First Half of Fiscal Year Ending March 31, 2006 October 24, 2005 This is an English translation of Japanese presentation material prepared for IR conference held on the above date; it includes the information on consolidated financial summary under Japanese GAAP for FYE March 2006.
Slide 2: Table of Contents
Table of Contents 1. Financial Results 2. Business Model and Future Development Financial Summary First Half of FYE Mar. 31, 2005 vs. First Half of FYE Mar. 31, 2006 3 Mission Statement 13 Second Half of FYE Mar. 31, 2005 vs. First Half of FYE Mar. 31, 2006 4 Current and Future Business Models: Furt
Slide 3: 1. Financial Results
1. Financial Results 2. Business Model and Future Development 2
Slide 4: Financial Summary: First Half FYE Mar 2005 vs First Half FYE Mar 2006
Financial Summary:First Half of FYE Mar. 31, 2005 vs. First Half of FYE Mar. 31, 2006 (in million yen, %) First Half of FYE First Half of FYE Mar. 31, 2005 Mar. 31, 2006 Change (Apr. 2004-Sep. 2004) (Apr. 2005-Sep. 2005) Operating Revenues 10,295 15,196 47.6% Net Operating Revenues 9,752 14,481 48.5
Slide 5: Financial Summary: Second Half FYE Mar 2005 vs First Half FYE Mar 2006
Financial Summary:Second Half of FYE Mar. 31, 2005 vs. First Half of FYE Mar. 31, 2006 (in million yen, %) Second Half of FYE First Half of FYE Mar. 31, 2005 Mar. 31, 2006 Change (Oct. 2004-Mar. 2005) (Apr. 2005-Sep. 2005) Operating Revenues 11,420 15,196 33.1% Net Operating Revenues 10,937 14,481 3
Slide 6: Financial Summary: 1Q vs 2Q of FYE Mar 2006
Financial Summary:1Q of FYE Mar. 31, 2006 vs. 2Q of FYE Mar. 31, 2006 (in million yen, %) 1Q of FYE 2Q of FYE Mar. 31, 2006 Mar. 31, 2006 Change (Apr. 2005-Jun. 2005) (Jul. 2005-Sep. 2005) Operating Revenues 6,151 9,045 47.1% Net Operating Revenues 5,774 8,706 50.8% SG&A 2,781 2,869 3.2% Operating I
Slide 7: Financial Highlights (Quarterly Basis)
Financial Summary:Financial Highlights (Quarterly Basis) Net Operating Revenues SG&A (in million yen) (in million yen) 10,000 10,000 8,706 7,500 7,500 6,340 5,774 4,596 5,000 5,000 2,721 3,004 2,781 2,869 2,500 2,500 0 0 3Q of FYE Mar. 4Q of FYE Mar. 1Q of FYE Mar. 2Q of FYE Mar. 3Q of FYE Mar. 4Q o
Slide 8: Brokerage Revenues and Non-brokerage Revenues
Financial Summary:Brokerage Revenues and Non-brokerage Revenues Brokerage Revenues Non-brokerage Revenues (=Brokerage Commission Revenues + Financial Income) (=Total Revenues – Brokerage Revenues) (in million yen) (in million yen) 8,000 1,400 Historical Historical High High 1,361 Historical Historic
Slide 9: Improved Profitability through the Merger of Subsidiaries
Financial Summary:Improved Profitability through the Merger of Subsidiaries SG&A and Number of Executed Trades Profitability(Operating Income/Operating Revenues) Total SG&A (Number of (in million yen) 80% Executed Trades) 3,500 System Related Expenses etc. 90,000 1Q 1Q of of FYE FYE Mar. Mar. 2006 2
Slide 10: Comparison with Competitors: High Profitability
Comparison with Competitors High Profitability Enhancing profitability Cost reduction through the merger and careful balance sheet management are key drivers (Annualized) 70% 16% 65% 60% 14% 12% 50% 11% 10% 40% 8% 30% 6% 20% 4% 10% 2% 0% 0% 1Q of FYE 2Q of FYE 3Q of FYE 4Q of FYE 1Q of FYE 2Q of FYE
Slide 11: Revenues/SG&A Per Customers' Assets in Custody
Comparison with Competitors Revenues/SG&A Per Customers’ Assets in Custody Numerical Target = Higher Revenues/Lower SG&A Per Customers’ Assets in Custody Key Factors : “Supply of High Value Added Products” and “Continuous Cost Control” (Annualized) Source:Company IR Data 3.00% Matsui Matsui Securiti
Slide 12: Comparison with Competitors: Highly Diversified Shareholders
Comparison with Competitors Highly Diversified Shareholders Shareholders of MBH as of Mar. 31, 2005) Shareholders of MBH as of Sep. 30, 2005) Others excluding Nikko Cordial Top 10 Others excluding Nikko Cordial Corporation Shareholders Top 10 Corporation 23% 30% Offering Offering Shareholders 26% Se
Slide 13: 2. Business Model and Future Development
1. Financial Results 2. Business Model and Future Development 12
Slide 14: Mission Statement
Mission Statement Take position as a total financial service provider, not just as an online brokerage firm Offer comprehensive products and service line-ups with “World Class Quality” Support passive investors to manage his/her financial assets efficiently Strengthen “Products Origination C
Slide 15: Current and Future Business Models: Further Expansion of Revenue Potentiality
Current and Future Business Models: Further Expansion of Revenue Potentiality Potentiality Brokerage -Expected further growth resulting from changes in national policies -Future cash inflow from banks, Brokerage postal savings and other traditional securities firms Commission and -Remain as a major
Slide 16: Strategy Towards the Next Stage of Growth
Strategy Towards the Next Stage of Growth 1999 2004 2005 October April February Complete deregulation of Securities intermediary services Livedoor vs. Fuji television case commissions and fees in start stock brokerage April Next Stage December Removal of blanket guarantee of deposit Securities inter
Slide 17: Continuous Efforts: For Our Customers
Continuous Efforts “For Our Customers” Cost Commission Lower cost More access Higher literacy For active customers: Lowest in the industry Cost For general customers : Competitive low pricing Cost does not only indicate commission, but also market Market Spread spread and opportunities, and fulfilli
Slide 18: Brokerage Business: Providing the Best Trading Platform
Brokerage Business: Providing the Best Trading Platform Commission Providing the Best Trading Platform Volume Volume Discount Discount Top Top trading trading customers’ customers’ average average commission commission rate rate :: Fast Fast and and Stable Stable System System 0.04 0.04 0.05 0.05 (a
Slide 19: Underwriting Business: Increase both Lead Manager Mandates and Underwriting of Shares
Underwriting Business: Increase both Lead Manager Mandates and Underwriting of Shares Innovation Strengthening the Investment Banking Business First online securities firm to enter into underwriting business Hiring top players Professional team with significant expertise and Executive experienced pe
Slide 20: Mutual Funds Business
Mutual Funds Business Highly Selected Funds, Front-Runner Among Online Mutual Fund Distributors Number of trades per business day Merger Effect million yen breaks a record 6 months in a row Number of trades per 2,478 Former Nikko Beans customers’ purchase trend business day 6.3billion yen Purchase v
Slide 21: Alternative Investments: Highest Quality Alternative Products
Alternative Investments: Highest Quality Alternative Products to Individual Investors First Full-fledged Fund Expansion of “Gatekeeper”Function (MAI) Investment Investment Trust Trust Linked Linked with with Fund Fund of of Asian Asian Funds Funds “Asia “Asia Focus” Focus” [Launched in Jul.2005] Pro
Slide 22: Forex and Fixed Income Businesses
Forex and Fixed Income Businesses: To be the Top Runner in Domestic Retail Business FX Business To Offer Latest and Highest Quality Customer Services Substantial Substantial increase increase in in number number of of accounts accounts Planning Planning New New Platform Platform for for improved imp
Slide 23: Investors Education: Contribute in Customer's Long-term Asset Management
Investors Education: Contribute in Customer’s Long-term Asset Management Mail Mail Magazines Magazines To Support Financial Literacy of Individuals Over 360,000 Over 360,000 subscribers subscribers Top Top ranked ranked financial financial mail mail magazines magazines Offering Offering financial fi
Slide 24: Business Alliances: Expansion of Customer Platform
Business Alliances Expansion of Customer Platform First Stage Large Scale Network Second Stage Local Network Alliances with Nationwide Financial Institutions Alliances with Local Financial Institutions and Other Firms Securities Intermediary Account Opening Introduction Credit Credit Saison Saison [
Slide 25: Competitive Services and Products: For All Customers' Satisfaction
Competitive Services and Products: For All Customers’ Satisfaction [As of Sep 30, 2005] Fixed Alternative Equities Mutual Funds Others Income Investments Stock Night Open In-house Stop Small- Lending JGB Monthly China/India CX Credit China U.S. Time Low High ATM Account Margin Loss Unit /Foreign Aut
Slide 26: New Challenges
New Challenges 1. Reinforcement of Marketing : 100% Commitment towards Higher Recognition Name Name Change Change December December 3, 3, 2005 2005 Monex Monex Beans, Beans, Inc. Inc. “Monex, Inc.” Marketing Marketing Budget Budget Tripled Tripled marketing marketing budget budget for for second sec
Slide 27: Further Business Expansion
Further Business Expansion OpenIPO® Investment Bank Monex Business Incubation WR Hambrecht Japan (MBI) Origination/M&A Incubation 33% 100% 100% Monex University Other Opportunities MBH (MU) Literacy 100% 51% Commercial Bank Monex Alternative Monex Beans, Inc. Investments (MAI) Deposit/Loan Brokerage
Slide 28: Monex Beans Holdings, Inc.
MBH Monex Beans Holdings, Inc.