Softbank Group Corp. · TSE:9984
Softbank — Q3 FY2022 Earnings Presentation
100 slides from Softbank's earnings presentation, Feb 7, 2023
Slide 1: Earnings Results for the Nine-month Period Ended December 31, 2022
Ver.1.2 Earnings Results for the Nine-month Period Ended December 31, 2022 Investor Briefing February 7, 2023 SoftBank Group Corp.
Slide 2: Disclaimers
Disclaimers This presentation provides relevant information about SoftBank Group Corp. (“SBG”) and its subsidiaries (including Arm Limited, together with SBG, the “Company”) and its affiliates (together with the Company, the “Group”) and does not constitute or form any solicitation of investment inc
Slide 3: Exchange rates and abbreviations
Exchange rates per JPY used for translation FY2021 FY2022 Average during quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1 USD 110.00 110.47 113.60 117.10 129.04 138.68 141.16 EOQ Jun 30 Sep 30 Dec 31 Mar 31 Jun 30 Sep 30 Dec 31 Mar 31 1 USD 122.39 132.70 Abbreviations Abbreviations used in Accounting and Finance s
Slide 4: Index
Index • Accounting • Finance • SoftBank Vision & LatAm Funds
Slide 5: Accounting
Accounting
Slide 6: Consolidated Results
Consolidated Results FY21 FY22 (¥ B) Q1-Q3 Q1-Q3 Change Change % Net sales 4,580.8 4,875.8 294.9 6.4% Income before 1,234.7 -290.0 -1,524.8 - income tax Net income (attributable to owners of the 392.6 -912.5 -1,305.1 - parent) (Reference) Loss on investments -551.8 -1,361.2 -809.4 - Investment Busin
Slide 7: Change in Reportable Segments
Change in Reportable Segments From FY22Q1, the Latin America Funds segment is included in the SoftBank Vision Funds segment; from FY22Q3, PayPay is included in the SoftBank segment. FY21 Investment SoftBank Business of SoftBank Arm Latin America Vision Funds Other Holding Companies Segment Segment F
Slide 8: No Impact on SBG from PayPay's Conversion into Subsidiary of SBKK
No Impact on SBG from PayPay’s Conversion into Subsidiary of SBKK PayPay became a subsidiary of SBKK and Z Holdings from Oct 2022. SBKK • PayPay’s conversion into a subsidiary: Recorded remeasurement gain of ¥294.8B relating to business combination in FY22Q3. • Change in accounting policy: Changed
Slide 9: Alibaba (Transactions in FY22Q2-Q3)
Alibaba (Transactions in FY22Q2-Q3) Scope of Ownership % consolidation *1 As of Jun 30, 2022 23.7％ Procurement through prepaid forward contracts Equity method Jul ($6.8B) associate Jul Physical settlement of prepaid forward contracts Early physical settlement of prepaid forward Exclusion from Aug–Se
Slide 10: Alibaba (Amounts Recorded in B/S)
Alibaba (Amounts Recorded in B/S) Equity method Investment securities (FVTPL) investments Excluded from Recorded in “investment securities” as Alibaba share price associates financial assets at FVTPL with investment Increment by income on equity $113.68 results measured at fair value method investme
Slide 11: Alibaba Shares and Derivative Financial Assets
Alibaba Shares and Derivative Financial Assets (Amount Recorded in B/S) Value of Alibaba shares recorded in B/S Investment securities (FVTPL) Derivative financial assets (net) considering prepaid forward contracts: Alibaba share price $88.09 $88.09 $32,825M ( A + B ) $79.99 $79.99 Of valuation gain
Slide 12: Expected Cash Tax Related to Alibaba Shares
Expected Cash Tax Related to Alibaba Shares SBG’s wholly owned subsidiary paid cash tax of ¥201.8B in FY22Q3 mainly due to the realization of derivative gain related to the early physical settlement of Alibaba prepaid forward contracts in Aug – Sep 2022. SBG estimated as of Dec 31, 2022 that cash ta
Slide 13: Segment Income: SoftBank Vision Funds
Segment Income: SoftBank Vision Funds (¥ B) FY21 FY22 P/L Q1-Q3 Q1-Q3 FY22Q1-Q3 Items Loss on investments at SoftBank Vision Funds -441.0 -5,042.7 Loss on investments at SVF1, SVF2, and LatAm Funds -442.9 -5,048.1 SVF1 -¥2,365.4B, SVF2 -¥2,240.0B, LatAm Funds -¥442.7B SVF1 +¥48.1B (mainly the full e
Slide 14: Investment Performance of SVF1 and SVF2
(Reference) Investment Performance of SVF1 and SVF2 ($ B) Since Inception FY22*1 Investment Gain/loss Gain/loss Returns*2 Gain/loss cost*2 (Q3) (Q1-Q3) SVF1 89.6 100.6 11.0 -2.5 -17.7 (-¥357.2B) (-¥2,365.4B) Exited investments 23.1 41.6 18.5 0.3 0.3 Investments before exit 66.5 56.6 -9.9 -2.6 -16.0
Slide 15: Segment Income: Investment Business of Holding Companies
Segment Income: Investment Business of Holding Companies (¥ B) P/L item FY21 FY22 FY22Q1-Q3 Items Q1-Q3 Q1-Q3 Gain on investments at Investment Business of Holding Companies 15.8 3,699.7 Gain relating to settlement of prepaid forward contracts using Alibaba shares 68.1 4,838.3 See pages 5 and 30 for
Slide 16: Monetization of T-Mobile Shares
Monetization of T-Mobile Shares Number of shares held Procured (millions) Execution Transaction amount Deutsche timing T-Mobile ($ B) Telekom shares shares a Borrowings made using 106.3M T-Mobile shares pledged as collateral (margin loan) 4.38 Jul 2020 Number of shares held as of Jun 30, 2021 106.3
Slide 17: T-Mobile Shares: Holding and Fair Values
T-Mobile Shares: The Company’s Holding (incl. Deutsche Telekom’s Unexercised Call Options) & Fair Values • In Apr 2022, the Company sold 21.2M FY20 FY21 FY22 T-Mobile shares, following Deutsche 6/26 Q4-end Q1-end Q2-end Q3-end Q4-end Q1-end Q2-end Q3-end Telekom's partial exercise of its call option
Slide 18: Deutsche Telekom Shares: Holding & Fair Values
Deutsche Telekom Shares: The Company’s Holding & Fair Values In Sep 2021, the Company FY21 FY22 acquired 225M Deutsche At execution Q2-end Q3-end Q4-end Ｑ1-end Q2-end Q3-end in Sep Telekom shares in return for the sale of T-Mobile shares. Deutsche Telekom share price €18.95 €18.64 €17.67 €17.40 €17.
Slide 19: T-Mobile Shares: Fair Values of Contingent Consideration
T-Mobile Shares: Fair Values of Contingent Consideration (Ref.) Closing price on Feb 3, 2023: $145.19 • Contingent T-Mobile share price $144.83 consideration: $140.00 $134.85 $134.54 The Company’s right $127.76 $134.17 $125.29 $128.35 to acquire 48.8M T-Mobile shares for $114.36 $115.98 $1,094.3M (¥
Slide 20: Loans/Guarantees/Loan Facility to WeWork
Loans/Guarantees/Loan Facility to WeWork Expected credit losses increased mainly due to worsening credit spreads for WeWork notes traded in the market. ($ M） B/S P/L FY22 Q3-end Carrying amount Account FY22Q1-Q3 Account (minus figures （breakdown） Loss recorded show liabilities) Other financial Other
Slide 21: Consolidated P/L Summary (IFRSs)
Consolidated P/L Summary (IFRSs) (¥ B) FY21 FY22 P/L item Change Q1-Q3 Q1-Q3 Net sales +4,580.8 +4,875.8 +294.9 Gain on investments at Investment Business of Holding Companies (consolidated basis): +¥3,699.6B (See page 11 for details) Gross profit +2,477.0 +2,579.1 +102.2 • Gain relating to settleme
Slide 22: Consolidated B/S Summary (IFRSs) – Assets
Consolidated B/S Summary (IFRSs) – 1 (¥ B) 1 Cash and cash equivalents: ¥5,778.1B（+¥609.1B） B/S item Main items Mar 2022 Dec 2022 Change SBG ¥2,896.0B（+¥393.4B） -¥1,033.6B decrease in derivative financial assets related to Alibaba prepaid 10,028.6 9,540.8 -487.8 forward contracts (due to the settlem
Slide 23: Investment Securities on Consolidated B/S
Investment Securities on Consolidated B/S (Main Investments) (¥ B) Mar 2022 Dec 2022 Change Outline Investment securities 3,085.4 6,854.0 3,768.7 FVTPL 2,587.6 6,431.5 3,843.9 The carrying amount of Alibaba shares held at FY22Q3-end was ¥4,148.6B, mainly reflecting the physical settlement of a porti
Slide 24: Breakdown of Goodwill/Intangible Assets
Breakdown of Goodwill/Intangible Assets (¥ B) Change B/S Main items Mar 2022 Dec 2022 Outline Item Amorti- Changes in Others zation FX rate 4,897.9 5,170.3 * Arm 2,898.1 3,142.1 ― 244.0 ― Goodwill SBKK 907.5 907.5 ― ― ― LINE 630.6 629.5 ― ― ― ZOZO 212.9 212.9 ― ― ― Technologies 357.7 353.6 Main Arm
Slide 25: Consolidated B/S Summary – Liabilities
Consolidated B/S Summary (IFRSs) – 2 (¥ B) 1 SBG B/S Borrowings (current and non-current) -¥886.1B Main items Mar 2022 Dec 2022 Change ・ Repaid borrowings under commitment lines: -$4.5B item ・ Repaid entire senior loans: -¥325.2B (including ¥292.7B repaid before 12,381.5 9,186.6 -3,194.8 maturity) 1
Slide 26: Consolidated B/S Summary – Equity
Consolidated B/S Summary (IFRSs) – 3 (¥ B) B/S Items Mar 2022 Dec 2022 Change item 1 11,707.8 10,593.6 -1,114.2 Repurchase of a portion of the USD-denominated Undated Subordinated Non-Call 6 years Resettable Notes (the Hybrid Notes): $0.75B (face value) Common stock 238.8 238.8 ― Capital surplus 2,6
Slide 27: Impact of the Weaker Yen on P/L & B/S
Impact of the Weaker Yen on P/L & B/S (Illustration) P/L B/S Entities Components Foreign exchange Exchange differences gain (loss) from translation Foreign currency- denominated cash and cash equivalents/ SBG stand-alone + Loans receivable Foreign exchange gain Subsidiaries conducting (excl. investm
Slide 28: Impact of the Weaker Yen in FY22Q1-Q3
Impact of the Weaker Yen in FY22Q1-Q3 Foreign exchange loss in consolidated P/L for FY22Q1-Q3: ¥728.0B SBG stand-alone: Foreign exchange loss of ¥900.8B related to foreign currency-denominated borrowings from Group companies, ¥82.3B related to foreign currency-denominated bonds (incl. hybrid bonds)
Slide 29: Consolidated C/F Summary (IFRSs)
Consolidated C/F Summary (IFRSs) (¥ B) FY21 FY22 C/F from operating activities: -¥1,684.1B yoy C/F item Change Primary details for FY22Q1-Q3 • Decrease in SB Northstar’s cash inflows: -¥1,791.4B Q1-Q3 Q1-Q3 Subtotal of cash flows from • Decrease in income taxes paid (cash outflows): +¥254.5B C/F fro
Slide 30: Co-investment Program to SVF2: Related Party Transactions
Co-investment Program to SVF2: Related Party Transactions Masayoshi Equity interests (third-party interests) SBG Son* 1 FY22Q3-end: $― (¥―) FY21-end: $2,207M (¥270.1B) Equity interests: 17.25% (B) (A) Distribution: $173M Equity acquisition amount: $2,923M 100% (Return of capital) (i) Acquisition cos
Slide 31: Income Taxes Paid on a Consolidated Basis (Net)
Income Taxes Paid on a Consolidated Basis (Net) (¥ B) FY19 FY20 FY21 Consolidated 636.3 445.5 589.3 Japan 575.2 310.5 551.2 SBG and holding 324.7 35.7 200.0 companies Operating companies, mainly SBKK and 250.5 274.8 351.2 Yahoo Japan Overseas 61.1 135.0 38.1 Notes: • The amounts are the net amount o
Slide 32: Characteristics of SoftBank Group's Taxation
Characteristics of SoftBank Group’s Taxation • Income on the consolidated P/L Illustration for calculation of SBG’s non-consolidated is not directly connected to income before income tax and income taxes SBG’s non-consolidated tax Calculation of non- payment amount. consolidated income before income
Slide 33: Appendix
Appendix
Slide 34: Early Physical Settlement of Alibaba Prepaid Forward Contracts
Early Physical Settlement of Alibaba Prepaid Forward Contracts Corresponding to 242M ADRs Announced on Aug 10, 2022 • P/L: Recorded ¥5,371.6B in income before income tax for FY22Q2 → Recorded value of Alibaba shares that had not been counted in accounting • B/S: Reduced financial liabilities relatin
Slide 35: Finance
Finance SBG stand-alone financial figures are calculated by excluding those of self- financing entities from the consolidated figures, unless otherwise stated. Major self-financing entities includes SBKK (including its subsidiaries such as Z Holdings and PayPay), SVF1, SVF2, LatAm Funds, and Arm.
Slide 36: Summary of FY22Q3
Summary of FY22Q3 Continue defensive financial management. Maintain ample of cash position NAV of ¥13.9T: -¥2.9T QoQ (incl. -¥1.5T FX impact) NAV/LTV LTV of 18.2％: +3.2% QoQ (incl. +2.1% FX impact) Cash position of ¥3.8T*1: -¥0.5T QoQ Continue monetization and debt reduction - Monetization: +$6.1B t
Slide 37: LTV Trend
LTV Trend*1 Controlled within financial discipline excl. asset-backed finance LTV 100％ 35% (in times of emergency) 25% (in normal *2 times) 18.2% 18.7% 21.6% 20.4% 14.3% 15.9% 14.5% 15.0% 16.1% 12.2% (excl. FX impact) Dec 20 Mar 21 Jun 21 Sep 21 Dec 21 Mar 22 Jun 22 Sep 22 Dec 22 *1 As of the end of
Slide 38: Impact of Changes in FX Rate
Impact of Changes in FX Rate ~90% of equity value of holdings are held in USD. Flow of funds is mostly USD-denominated Equity value of holdings*1 Breakdown by holding currency excl. asset-backed finance 1% EUR FX impact from Sep 30 to Dec 31 (8% weaker USD against JPY) JPY 13% NAV：-¥1.5T LTV：+2.1% T
Slide 39: Main Financing Activities in FY22Q3
Main Financing Activities in FY22Q3 Continued defensive financial management; monetization progressed and bonds refinanced Repurchased foreign currency-denominated notes (Oct) (incl. hybrid notes of $750M) -$2.3B -¥319.7B equivalent Bonds Redeemed domestic senior retail bonds (Dec) -$2.4B -¥337.0B e
Slide 40: Cash Position
Cash Position Maintain ample cash position, well over 2-year worth of bond redemptions Cash position Bond redemption schedule ¥3.8T *1 (¥ B) 646.0 Undrawn commitment line*2 Bond redemptions for the next 2 years (¥1.4T) ＞ 3,137.8 1,026.7 1,201.7 882.1 402.1 Dec 2022 Jan 23 - Dec 23 Jan 24 - Dec 24 Ja
Slide 41: Issuance of Domestic Senior Retail Bonds
Issuance of Domestic Senior Retail Bonds Refinanced senior bonds in Dec 2022. Continue to widely market to retail investors The 19 th Fukuoka SoftBank HAWKS Bond Number of sales to retail investors Total Approx. 94K ¥385.0B *1 amount of (redeemed ¥337.0B) issue Offerees Mainly retail investors Prize
Slide 42: SBG's Initiatives in Retail Bond Market in Japan
SBG‘s Initiatives in Retail Bond Market in Japan Continue to provide various instruments, having developed and expanded domestic retail bond markets SBG issuance of domestic retail bonds (by fiscal year) Cumulative amount issued*1 ¥7.1T ¥3.6T (¥ B) First subordinated bonds of which, amount redeemed
Slide 43: Size of Japanese Retail Bond Markets
Size of Japanese Retail Bond Markets Retail bond market steadily expanding Outstanding amount of Japanese retail bonds*1 (excl. retail JGBs) (¥ T) Corporate bonds, electric power bonds, etc. ¥ 7.8T Other (incl. Samurai bonds and bonds Outstanding issued by financial institutions, life/general insura
Slide 44: Retail Investors' Ownership in Corporate Bonds
Retail Investors’ Ownership in Corporate Bonds Retail investors’ share grew in retail bonds Corporate bond ownership distribution (since 2005)*1 100% Other (incl. various corporations, etc.) 90% Overseas 80% Mutual funds Retail investors: 6.4% Public and private pension funds % of retail investor 70
Slide 45: Bond Redemption Schedule
Bond Redemption Schedule Redemptions will be funded by carefully managed bond issuance with due consideration for cash position and market environment (¥ B) 1,344.8 Domestic senior bonds Domestic subordinated bonds 294.8 1,087.8 Domestic hybrid bonds 999.4 Foreign currency-denominated senior notes 1
Slide 46: Response to First Call for USD-denominated Hybrid Notes
Response to First Call for USD-denominated Hybrid Notes Hybrid Notes subject to refinancing Approach to refinancing Early redemption First call date July 19, 2023 on first call Outstanding YES $2.0B amount Maintain equity treatment Interest rate 6.000% per annum of the Hybrid Notes Undated YES NO Le
Slide 47: SBG Credit Spread
SBG Credit Spread Credit spreads rapidly tightened amid calmer interest rate movements Spread of SBG foreign currency- SBG 5-year CDS denominated senior notes 800 600 bps bps 700 500 600 400 500 400 300 300 200 USD 3.0Y USD 4.5Y 200 SBG 5Y CDS (JPY) USD 6.5Y USD 9.5Y EUR 2.5Y EUR 5.0Y 100 100 EUR 7.
Slide 48: Interest Rates in Japan & U.S.
Interest Rates in Japan & U.S. Global tapering trend and expectations of the unwinding led to higher interest rates 10-year U.S. Government Bond Yield 10-year Japanese Government Bond and Swap Yield 10-year JGB 10-year Swap 3.40% 2.25% 0.82% 0.50% 0.25% 0% 0% Jan 16 Feb 23 Jan 16 Feb 23 (Notes) • As
Slide 49: Impact of U.S. and Japan Interest Rates on Interest Payment
Impact of U.S. and Japan Interest Rates on Interest Payment Breakdown of SBG Interest-bearing Debt*1 by Fixed/Floating (excl. prepaid forward contracts） Floating rate; USD Floating rate; JPY*2 14% 9% Minimal impact of Rise in JPY interest rates higher interest give minimal impact on payments, mainly
Slide 50: SBG Stand-alone Interest-bearing Debt
SBG Stand-alone Interest-bearing Debt*1 Main changes from Sep 2022 Reduced debts by approx. ¥1.2T from • Physical settlement of prepaid forward contracts using Alibaba shares Mar 2022 (excl. non-recourse debts) -¥974.8B • Entry into prepaid forward contracts using Alibaba shares +$6.1B • Repurchase
Slide 51: SBG Stand-alone Cash Position
SBG Stand-alone Cash Position Maintain ample liquidity while reducing debts (¥ B) 3,944.8 127.1 3,637.4 76.6 3,173.4 3,079.9 35.6 Cash position of SB Northstar 2,681.1 330.0 582.1 Main changes from Sep 2022 Increase Decrease 3,817.6 3,560.8 ・New conclusion of ・Share repurchase -¥532.3B 3,137.8 prepa
Slide 52: SBG Stand-alone Net Interest-bearing Debt
SBG Stand-alone Net Interest-bearing Debt Adjusted net debt compressed approx. ¥1.6T since Mar 2022 (¥ B) excl. SB Northstar 12,135.3 12,021.0 11,486.0 8,504.9 8,112.2 6,163.8 7,411.2 8,871.8 Finance-related adjustments 5,549.1 5,030.2 Asset-backed finance, etc. ¥4,901.0B Hybrid finance ¥129.2B 5,32
Slide 53: Asset-backed Finance Using Alibaba Shares
Asset-backed Finance Using Alibaba Shares Beneficial ownership decreased after physical settlement of prepaid forward contracts Beneficial 23.7% ownership Used for prepaid 14.6% forward 13.5% contracts Monetization in FY22Q3 $6.1B through forward transactions *1 *2 *3 Jun 22 Sep 22 Dec 22 *1 Calcula
Slide 54: Equity Value of Holdings: Diversified Portfolio
Equity Value of Holdings: Diversified Portfolio Continued diversification of portfolio excl. asset-backed finance Mar 31, 2022 Dec 31, 2022 % of listed shares*1 % of listed shares*1 (net of asset-backed finance) (net of asset-backed finance) Others 52% Others 44% Alibaba 8% Alibaba 8% Arm 12% 23% Ar
Slide 55: Historical Share Repurchase Amount
Historical Share Repurchase Amount Repurchased approx. ¥4T worth of shares cumulatively in 3 years since “¥4.5T program.” Completed a massive share repurchase of over ¥1T in FY22 (¥ B) Cumulative share repurchase approx. ¥4T 2,226.2 1,055.4 602.4 384.1 232.0 FY18 FY19 FY20 FY21 FY22 Finance 21
Slide 56: Financial Policy Remains Unchanged
Financial Policy Remains Unchanged (2) Flexible and (1) Firmly keeping adaptive financial financial policy management Finance 22
Slide 57: Firmly Keeping Financial Policy
Firmly Keeping Financial Policy 1. Maintain LTV below 25% in normal times (upper threshold of 35% even in times of emergency) 2. Maintain at least 2-year worth of bond redemptions in cash 3. Secure recurring distributions and dividend income from SVF and other subsidiaries Finance 23
Slide 58: Appendix
Appendix
Slide 59: Calculation of Equity Value of Holdings as of Dec 31, 2022
Calculation of Equity Value of Holdings as of Dec 31, 2022 $1 = ¥132.70 (¥ T) Equity value of holding Equity value of holdings Adjustment for ＝ ー (adjusted) （unadjusted） asset-backed finance ¥21.5T （unadjusted） ¥2.0T ＝ ¥4.1T 355M shares held*1 × Share price ＄88.09*1 ー Collar contract, etc. ¥2.1T Col
Slide 60: LTV Calculation: SBG Stand-alone Equity Value of Holdings
LTV Calculation: SBG Stand-alone Equity Value of Holdings (L) Adjusted ¥3.08T SBG stand-alone net debt =18.2% (V) Adjusted SBG stand-alone equity value of holdings*1 ¥16.93T (¥ T) Adjusted SBG Major SBG’s interest in Other Investments = + + stand-alone equity value of holdings assets SVF1&2 & LatAm
Slide 61: LTV Calculation: Details of Equity Value of Holdings (1/2)
LTV Calculation: Details of SBG Stand-alone Equity Value of Holdings (1/2) (¥ T) Assets Value Calculation method (a) Alibaba 2.05 Multiplying the number of Alibaba ADSs equivalent to the number of shares held by SBG by Before adjustment 4.15 the ADS price Sum of the outstanding maturity settlement a
Slide 62: LTV Calculation: Details of Equity Value of Holdings (2/2)
LTV Calculation: Details of SBG Stand-alone Equity Value of Holdings (2/2) (¥ T) Assets Value Calculation method (g) T-Mobile 1.15 summing - Value of SBG’s shareholding (incl. the number of shares subject to call options held by Deutsche Telekom (DT): 34,971,809 shares as of Dec 31, 2022) × the shar
Slide 63: LTV Calculation: SBG Stand-alone Net Debt
LTV Calculation: SBG Stand-alone Net Debt (L) Adjusted SBG stand-alone net debt*1 ¥3.08T (V) Adjusted SBG stand-alone ¥16.93T =18.2% equity value of holdings (¥ T) Adjusted SBG Consolidated Net debt at self- Other stand-alone net debt = net debt - financing entities - adjustments 3.08 13.48 5.37 5.0
Slide 64: LTV Calculation: Details of SBG Stand-alone Net Debt
LTV Calculation: Details of SBG Stand-alone Net Debt (¥ T) SBG stand-alone net debt Consolidated net interest-bearing debt, (before adjustment) 8.11 net of interest-bearing debt at self-financing entities - Add 50% to interest-bearing debt (to treat it as liability) for USD Hybrid Notes issued in Ju
Slide 65: Adjustment for Asset-backed Finance in LTV and NAV Calculation
Adjustment for Asset-backed Finance in LTV and NAV Calculation Non-recourse asset-backed finance is deducted from debt. Value of assets required for settlement is deducted from assets 21.5 (¥ T) Collar/Forward/Put 1 2 Margin loan, etc. transactions 1 3.0 Asset-backed Main shares finance Alibaba SBKK
Slide 66: Forward Transaction / Collar Transaction
(Ref.) Forward Transaction / Collar Transaction Objective Non-recourse financing using derivatives • Transaction where parties agree to settle at a pre-specified price or price range at a specific date in the future • Finance through pledged shares and derivatives referencing them Outline • Settleme
Slide 67: SBG Credit Rating Trend
SBG Credit Rating Trend Acquisition of Acquisition of Acquisition Acquisition Listing A+ 14 Japan Telecom Vodafone KK of Sprint of Arm of SBKK A 13 JCR (A－) A- 12 Outlook Stable BBB+11 BBB 10 JCR revised its outlook to “Stable” from “Positive” on January 20, 2023 BBB- 9 BB+ 8 S&P (BB＋) Outlook Negat
Slide 68: Consolidated Interest-bearing Debt/ Cash Position/ Net Debt
Consolidated Interest-bearing Debt/ Cash Position/ Net Interest-bearing Debt Consolidated Interest-bearing Debt*1 (\ B) Dec 21 Mar 22 Jun 22 Sep 22 Dec 22 SBG stand-alone 13,860.4 14,918.7 15,842.9 12,065.7 11,250.0 Incl. SB Northstar 275.4 33.5 4.2 - - SVF1&2 and LatAm Funds 1,208.6 1,077.3 1,413.4
Slide 69: SoftBank Vision & LatAm Funds Investor Briefing
QUARTER ENDED DECEMBER 31, 2022 Investor Briefing SoftBank Vision & LatAm Funds NAVNEET GOVIL CFO, Member of the Executive Committee SB Global Advisers
Slide 70: Important Information (1 of 2)
2 Important Information (1 of 2) This presentation (this “Presentation”) is furnished to you for informational purposes in connection with the interests of SoftBank Group Corp. (together with its affiliates, “SoftBank”) in SoftBank Vision Fund L.P. (together with, as the context may require, any par
Slide 71: Important Information (2 of 2)
3 Important Information (2 of 2) Vision Fund I performance herein is based on unrealized valuations of portfolio investments. Valuations of unrealized investments are based on assumptions and factors (including, for example, as of the date of the valuation, average multiples of comparable companies,
Slide 72: Topics
4 Topics 01- Progress & Highlights 02- Performance & Impact on SoftBank Group (SBG) 03- In Focus: Resilience & Discipline in a Challenging Market
Slide 73: Progress & Highlights
5 Progress & Highlights
Slide 74: Despite a Volatile Year, We Remain High-Conviction Investors in AI
PROGRESS & HIGHLIGHTS 6 Despite a Volatile Year, We Remain High-Conviction Investors in AI Portfolio Companies Continue $16B+ to Attract Investor Interest, MARKET DEVELOPMENTS Capital Raised Completing 80+ Funding 20222 Rounds in 2022 2022 Performance1 Nasdaq Tech 100 Refinitiv VC Index 94% Invested
Slide 75: Performance Snapshot
SVF1 SVF2 LATAM 7 SoftBank SoftBank SoftBank Vision Fund 1 Vision Fund 2 LatAm Funds Combined Total Commitment $98.6B $56.0B $7.6B $162.2B PROGRESS & HIGHLIGHTS Performance Acquisition Cost1 $87.9B $49.4B $7.3B $144.6B Snapshot Cumulative Gross $13.1B $(17.0B) $(0.9B) $(4.8B) Investment Gains/(Losse
Slide 76: Distributions to Limited Partners
SVF1 PROGRESS & HIGHLIGHTS 8 Distributions to Limited Partners Since Inception to December 31, 2022 Total Distributions (A) (B) (C) (D) (E) = (B)-(C) Fund Drawn Return of Pref Coupon / 3 Outstanding 2 Commitment Capital 1 Capital Equity Gains 4 Capital 5 Preferred Equity $40.0B $36.2B $18.6B $7.0B $
Slide 77: Our Portfolio Companies Raised $16B+ in 2022
SVF1 SVF2 LATAM PROGRESS & HIGHLIGHTS 9 Our Portfolio Companies Raised $16B+ in 2022 Twelve-Month Period Ended December 31, 2022 87 Equity Round Series E Series E Series E Series B Series C Series D Series B Series G Series D Funding Rounds1 92% Series D Series D Series C Series C Series C Series E
Slide 78: A Maturing Portfolio Generating Sustainable Revenue Growth
SVF1 SVF2 LATAM 10 Investments by Revenue Stage By Fair Value (%)1 PROGRESS & HIGHLIGHTS 49% A Maturing Portfolio Generating Sustainable Revenue Growth 21% 17% As of December 31, 2022 13% Less Than $50mm $50mm - $250mm $250mm - $1,000mm More Than $1,000mm Footnotes: 1. Based on Fair Value of private
Slide 79: Invested Across Diverse Sectors (1/3)
SVF1 SVF2 LATAM PROGRESS & HIGHLIGHTS 11 Invested Across Diverse Sectors (1/3) As of December 31, 2022 FAIR VALUE & INVESTMENT COUNT BY SECTOR Consumer Transportation Frontier Tech $38.8B | 88 Investments $21.0B | 25 Investments $20.2B | 33 Investments G UA I Footnotes: Consumer - SoftBank Vision Fu
Slide 80: Invested Across Diverse Sectors (2/3)
SVF1 SVF2 LATAM PROGRESS & HIGHLIGHTS 12 Invested Across Diverse Sectors (2/3) As of December 31, 2022 FAIR VALUE & INVESTMENT COUNT BY SECTOR Enterprise Logistics Health Tech $12.3B | 93 Investments $17.8B | 36 Investments $9.1B | 56 Investments Footnotes: Enterprise - SoftBank Vision Fund 1 Fair V
Slide 81: Invested Across Diverse Sectors (3/3)
SVF1 SVF2 LATAM PROGRESS & HIGHLIGHTS 13 Invested Across Diverse Sectors (3/3) As of December 31, 2022 FAIR VALUE & INVESTMENT COUNT BY SECTOR Fintech Proptech Edtech $9.8B | 79 Investments $6.8B | 25 Investments $1.5B | 16 Investments BEIKE Footnotes: Fintech - SoftBank Vision Fund 1 Fair Value: $2
Slide 82: A Cautious Approach to Investing in the Blockchain & Crypto Sector
SVF1 SVF2 LATAM PROGRESS & HIGHLIGHTS 14 A Cautious Approach to Investing in the Blockchain & Crypto Sector As of December 31, 2022 TOTAL EXPOSURE % OF AUM 1 # INVESTMENTS Our Sector Approach Potential for multi- Technology TOTAL FAIR VALUE G ROSS MOIC 2 industry applications infrastructure focused
Slide 83: Performance & Impact on SoftBank Group (SBG)
15 Performance & Impact on SoftBank Group (SBG)
Slide 84: SVF1 Contribution to SBG, Net of 3rd Party Interests
16 SVF1 2022 Inception to Dec 31 SVF1 Fund Net Profit2 $2.8 PERFORMANCE & IMPACT ON SBG Less: Change in 3rd Party Contribution to Interests in Fund (1.6) SBG, Net of 3rd SBG LP Income: 1.2 Share of Fund Net Profit Party Interests1,3 SBG GP Income: Amounts in USD Billions 1.0 Management & Performance
Slide 85: Contribution to SBG: SVF1
17 SBG Paid-In Capital1 SVF1 PERFORMANCE & IMPACT ON SBG Contribution to SBG SBG Total Value2 As of December 31, 2022 Net Asset Value3 Distributions4 Footnotes: 1. SBG Paid-In Capital represents SBG Commitment drawn down through capital calls less Return of Recallable unutilized Contributions. 2. SB
Slide 86: Contribution to SBG: SVF2
18 SBG Paid-In Capital1 SVF2 PERFORMANCE & IMPACT ON SBG Contribution to SBG SBG Total Value2 As of December 31, 2022 Net Asset Value3 Distributions4 Footnotes: 1. SBG Paid-In Capital represents SBG Commitment drawn down through capital calls less Return of Recallable unutilized Contributions. SBG P
Slide 87: Contribution to SBG: LatAm
19 SBG Paid-In Capital1 LATAM PERFORMANCE & IMPACT ON SBG Contribution to SBG SBG Total Value2 As of December 31, 2022 Net Asset Value3 Distributions4 Footnotes: 1. SBG Paid-In Capital represents SBG Commitment drawn down through capital calls less Return of Recallable unutilized Contributions. SBG
Slide 88: In Focus: Resilience & Discipline in a Challenging Market
20 In Focus: Resilience & Discipline in a Challenging Market
Slide 89: A High-Conviction Portfolio Supported by Defensive Measures
R E S I L I E N C E & D I S C I P L I N E I N A C H A L L E N G I NG M A R K E T 21 A High-Conviction Portfolio Supported by Defensive Measures Portfolio Diversification Select Disciplined Focus and Defensive Approach to Monetization Measures Distributions Strategic Opportunities Operational & Selec
Slide 90: Portfolio Companies Pursuing Consolidation Opportunities
SVF1 SVF2 LATAM R E S I L I E N C E & D I S C I P L I N E I N A C H A L L E N G I NG M A R K E T 22 Portfolio Companies Pursuing Consolidation Opportunities Twelve-Month Period Ended December 31, 2022 Benefits of Economies of Expansion to Product Access to Diversification Consolidation Scale & Scope
Slide 91: Partnerships Forged During Periods of Uncertainty
SVF1 SVF2 LATAM R E S I L I E N C E & D I S C I P L I N E I N A C H A L L E N G I NG M A R K E T 23 Partnerships Forged During Periods of Uncertainty Twelve-Month Period Ended December 31, 2022 Benefits of Strategic Partnerships Portfolio Company Partner(s) Description Acquired in-venue retail right
Slide 92: Embedding Operational & Financial Resilience
SVF1 SVF2 LATAM R E S I L I E N C E & D I S C I P L I N E I N A C H A L L E N G I NG M A R K E T 24 Embedding Operational & Financial Resilience As of December 31, 2022 SELECT AREAS OF FOCUS Portfolio Companies Continue to Moderate Operating Expenses Rationalizing Sales & Marketing costs % of Portfo
Slide 93: Portfolio Companies Continue to Be Well-Capitalized
SVF1 SVF2 LATAM 25 By Fair Value1 RESILIENCE & DISCIPLINE IN A CHALLENGING MARKET SVF1 SVF2 LATAM Portfolio Companies Continue to Be Well-Capitalized 99% 90% 79% As of December 31, 2022 Footnotes: 1. Source: SBGA/SBIA Analysis. Based on portfolio company fair value. Excludes portfolio companies wher
Slide 94: A High-Conviction Portfolio Supported by Defensive Measures
R E S I L I E N C E & D I S C I P L I N E I N A C H A L L E N G I NG M A R K E T 26 A High-Conviction Portfolio Supported by Defensive Measures Portfolio Diversification Select Portfolio Diversification Disciplined Focus and Defensive Approach to Monetization Measures Select Distributions Discipline
Slide 95: Disciplined & Focused Approach to Monetization
SVF1 SVF2 LATAM R E S I L I E N C E & D I S C I P L I N E I N A C H A L L E N G I NG M A R K E T 27 Disciplined & Focused Approach to Monetization MONETIZ A TI O N DR IVER S MONETIZ A TI O N F ACTOR S Strategic Asset-Specific Market & Fund Factors Factors Performance Expectations Sector & Geographic
Slide 96: Our Monetization Approach Continues to Drive Optimal Outcomes
SVF1 SVF2 LATAM R E S I L I E N C E & D I S C I P L I N E I N A C H A L L E N G I NG M A R K E T 28 Our Monetization Approach Continues to Drive Optimal Outcomes As of December 31, 2022 MONETIZATION HIGHLIGHTS CUMULATIVE PROCEEDS SINCE INCEPTION Cumulative Proceeds3 ($B) NASDAQ Performance4 16,057 5
Slide 97: Portfolio Companies Poised to List Publicly
SVF1 SVF2 LATAM R E S I L I E N C E & D I S C I P L I N E I N A C H A L L E N G I NG M A R K E T 29 Portfolio Companies Poised to List Publicly As of December 31, 2022 $37B+ Public Listing Readiness Value of Late-Stage Portfolio Company Holdings Strong Fundamentals Total FV, Series E or Later1 Resil
Slide 98: Consistent Ability to Return Capital
SVF1 SVF2 LATAM R E S I L I E N C E & D I S C I P L I N E I N A C H A L L E N G I NG M A R K E T 30 Consistent Ability to Return Capital As of December 31, 2022 LATAM SVF2 SVF1 Years since Launch 3+ 3+ 5+ % of Capital 1% 18% 50% $53.4B Returned2 $44.2 Total Distributions1 Distributions ($B)1 $9.1 $0
Slide 99: We Remain Relentlessly Focused on Artificial Intelligence
31 RESILIENCE & DISCIPLINE IN A CHALLENGING MARKET Projected Contribution of AI to the Global Economy – 2030E1 We Remain Relentlessly Focused on Artificial Intelligence Increase in AI Adoption Globally, 2017 – 20222 INVESTING VALUE CREATION MONETIZATION AI Chip Market CAGR3 The global AI Chip market
Slide 100: Thank You
32 Thank You SoftBank Vision & LatAm Funds Investor Briefing Presentations Available at visionfund.com/presentations