Monex Group, Inc. · TSE:8698
Monex — Q1 FYE 03/2004 Earnings Presentation
24 slides from Monex's earnings presentation, Jul 16, 2003
Slide 1: FYE 03/2004 1Q Financial Results
FYE 03/2004 1Q Financial Results July 16, 2003 This is an English translation of Japanese presentation material prepared for IR conference held on the above date; it includes the information on non- consolidated financial summary under Japanese GAAP for the first quarter of FYE March 2004. If there
Slide 2: I. Financial Results / II. Business Model and Future Development
I. Financial Results II. Business Model and Future Development 1
Slide 3: FYE 03/2004 1Q Financial Summary (1)
FYE 03/2004 1Q Financial Summary (1) （in million yen） ） FYE 03/2003 FYE 03/2004 Change 1Q 1Q Operating Revenue 811 1,252 54.3% Net Operating Revenue 811 1,164 43.5% SG&A 1,148 1,101 -4.1% Operating Income (Loss) (337) 63 - Ordinary Income (Loss) (334) 66 - Net Income (Loss) (349) 37 - （Apr. – June 2
Slide 4: FYE 03/2004 1Q Financial Summary (2)
FYE 03/2004 1Q Financial Summary (2) （in million yen） ） FYE 03/2003 FYE 03/2004 Change 4Q 1Q Operating Revenue 705 1,252 77.6% Net Operating Revenue 658 1,164 76.7% SG&A 1,093 1,101 0.7% Operating Income (Loss) (434) 63 - Ordinary Income (Loss) (432) 66 - Net Income (Loss) (677) 37 - （Jan. – Mar. 20
Slide 5: Net Operating Revenue vs. SG&A
Net Operating Revenue vs. SG&A (million yen） 1,182 1,217 1,142 1,148 1,136 1,099 1,093 1,164 1,015 974 923 891 1,101 848 942 Net Operating 850 811 748 752 764 779 794 Revenue 647 641 601 658 SG&A FYE 2Q 3Q 4Q FYE 2Q 3Q 4Q FYE 2Q 3Q 4Q FYE 03/2001 03/2002 03/2003 03/2004 1Q 1Q 1Q 1Q Net Operating Rev
Slide 6: Break-even Analysis Spreadsheet
Break-even Analysis Spreadsheet 1. Divide major items of SG & A into 2 categories (1) Variable (trade volume or number of accounts base) and (2) Fixed. After excluding one-time expenses, Outsourcing Expenses are divided into three categories. (million yen） FYE FYE FYE FYE 03/2002 03/2002 03/2003 03/
Slide 7: Break-even Analysis – Number of Trades
Break-even Analysis – Number of Trades FYE 03/2004 1Q 2,500 1,000 ● Number of trades has largely 867 862 increased due to the vigorous stock 822 791 788 805 market. 788 753 2,000 839 721 800 ● Brokerage commission per trade 777 has increased partly because of the 770 778 778 （ thousand） ） 612 732 74
Slide 8: Revenue Diversification
Revenue Diversification (million yen) 600 Others Monex FX New services started 500 Financial Income Monex FX Brokerage（（ Margin）） 400 Underwriting (IPO) Stock Lending Investment Trusts 300 Brokerage（（ Cash） ） Margin trading 200 100 0 02 02 02 02 02 02 02 02 02 03 03 03 03 03 03 4/20 5/20 6/20 7/20 8
Slide 9: TSE Individual Trading Volume vs. Monex Trading Volume
TSE Individual Trading Volume vs. Monex Trading Volume TSE individual investors trading volume vs. Monex clients'trading volume at TSE (Index: 04/2002 = 100) 400 4.4% With the start of margin trading Monex’s share has recovered. 300 3.3% The relative in Trading volume crease of the m transaction ha
Slide 10: Number of Accounts
Number of Accounts Number of margin accounts and Number of Accounts Ratio of margin accounts to total number of accounts 300,000 30.0% Matsui Monex （ 56） Dec. 2002（ ） Ratio of margin accounts to DLJ June 2003 （ 62） ） total number of accounts 250,000 25.0% Matsui E*Trade 200,000 20.0% 150,000 15.0% E
Slide 11: Customers' Assets in Custody
Customers’ Assets in Custody (yen) 15,000 11,000 Customers' assets in custody （ billion yen） ） 7,000 Nikkei 225 Average Index 489.2 447.0 458.9 418.4 428.8 402.1 408.1 404.5 74.7 374.5 76.1 72.0 64.4 64.2 31.4 63.4 31.9 64.0 64.7 31.0 66.0 31.4 31.8 291.9 30.3 31.2 29.8 28.7 55.5 13.0 350.9 370.9 MR
Slide 12: Margin Trades
Margin Trades Changes in number of trades （ Index October 1, 2002 ＝ 100, 5-Day Moving Average） ） 300 Total number of trades Cash Trades 250 Margin Trades 200 150 100 50 0 2 2 2 2 2 3 3 3 3 3 3 3 3 00 00 00 00 00 00 00 00 00 00 00 00 00 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 /2 10 10 11 12 12 01 02 03 0
Slide 13: Stock Lending
Stock Lending The Theclients clientscould couldgain gainearnings earningson ontheir theirstock stockportfolio portfolioby bylending lendingstocks stockstotoMonex. Monex. Portfolio Growth 16 Growth of S/L portfolio Stock Lending 14 14.3 12 billion yen 10 8 8.5 billion yen # of S/L accounts : 3,925 Cu
Slide 14: Monex FX – Margin FOREX Trades
Monex FX – Margin FOREX Trades FX FXtrades tradesfits fitstotoour ourclient clientbase; base;both bothaccounts accountsand andvolume volumeare aregrowing growingrapidly rapidly ● Monex clients base – 5,000 major clients are company employees and public Trading volume per business day (million yen) 4
Slide 15: Investment Trusts
Investment Trusts A wide range of investment trusts for customers with various risk Attractive investment trusts preference and return requirement Position In addition to US$ MMF, Euro MMF was ・ Goldman Sachs・ Long Short recently added as a new investment tool in Euro MMF foreign currency Stock -Sto
Slide 16: Underwriting (IPO)
Underwriting (IPO) ） Underwriting issues (# of companies） FYE 3/2004 Underwriting amount （ million yen） ） 1Q Results 1Q Name of issuer Date Share Taiyo Life Insurance 04/01/2003 0.2% Monex 5 473 WACOM マネックス 04/24/2003 25.0% Information Planning 05/30/2003参入3.0% NETMARKS 27 社2.0% 06/12/2003 6 E*trade
Slide 17: I. Financial Results / II. Business Model and Future Development
I. Financial Results II. Business Model and Future Development 16
Slide 18: Business Plan
Business Plan Stock StockBrokerage Brokerageasascore coreproduct; product;and andother otherunique uniqueproducts products&&services servicesare areprovided provided All-round Online broker Establish High Quality Stability & Credibility Services & Products Domestic Stock I.T. IPO Lending Diversify b
Slide 19: Growth Strategy
Growth Strategy Focus Focuson onhighly highlyactive activeclients clientstotoincrease increaserevenue revenuewhile whileattracting attractingaawide widerange rangeofofnew newclients clients Focus on ・Fixed fee schedule services for ・Mobile phone margin trading highly active （scheduled to be released
Slide 20: High Quality Products & Services
High Quality Products & Services Become Become“All-round “All-roundOnline OnlineBroker” Broker”by byproviding providingvarious variousproducts productsfor forcustomers customershaving havingvarious variousrisk riskpreference preference Price fluctuation risk : Large Interest Interest Foreign bonds r
Slide 21: Revenue Base Diversification
Revenue Base Diversification Efforts Effortstotoincrease increasetotal totalrevenue revenueby bydiversifying diversifyingrevenue revenuesources sources Revenue Image of future revenue growth FX Margin Trading Financial Income （including revenue from Stock Lending) Stock Brokerage (Margin) IPO Invest
Slide 22: Stability and Credibility
Stability and Credibility The Themost mostimportant importantkey keyisistotoestablish establishcredibility credibilityand andstability stabilitytotosustain sustaingrowth growthasasaa financial financialinstitution. institution. Maintain sound financial structure - Improve profit & :losses by increas
Slide 23: Monex in Progress
Monex in Progress Prepare Preparefor forfurther furtherprogress progresswith withwell wellplanned plannedstrategy. strategy. Novice investors Highly active clients Margin 《《《《 Saison S/L JGB IPO FX Trading Domestic Foreign currency Stocks Foreign I.T. Co-operation with other companies I.T. bonds Mon
Slide 24: MONEX
MONEX http://www.monex.co.jp/