Slide 1: Financial Results for 3Q of Fiscal Year Ending March 31, 2023
TSE Prime : 8698 Monex Group Financial Results for 3Q of Fiscal Year Ending March 31, 2023 January 30, 2023
Slide 2: Corporate Philosophy
Corporate Philosophy Always a step ahead of the “Y” in “MONEY,” our name MONEX expresses our desire to embrace all people who are engaged at the forefront of our future. With state-of-the-art IT technology, globally universal values and a sense of professionalism, Monex Group designs innovative ways
Slide 3: Table of Contents
Corporate Philosophy p.1 Table of Contents p.2 Ⅰ. Highlights p.3 - p.10 Ⅱ. Consolidated Performance p.11 - p.30 Ⅲ. Business Update p.31 - p.47 Appendix: Group Overview p.48 -p.60 Disclaimer p.61 This is an English translation of Japanese presentation materials prepared in connection with the disclos
Slide 4: I. Highlights
MONEX GROUP I . Highlights
Slide 5: Quarterly Operating Income (Three Major Segments)
Quarterly Operating Income (Three Major Segments) Operating income in the US Segment (TradeStation) has improved significantly since the strategy change in August 2022. Going forward, in addition to the steady earnings of the Japan and US Segment, the Crypto Asset Segment has profit upside potential
Slide 6: Consolidated Pre-tax Income (3Q vs 2Q of FYE Mar. 31, 2023)
Consolidated Pre-tax Income (3Q vs 2Q of FYE Mar. 31, 2023) Increased operating income of the online brokerage businesses in Japan and US driven by higher interest rate and favorable forex market. The US dollar cash position held by the holding company Monex Group resulted in a quarterly loss due to
Slide 7: Quarterly Gains and Losses of Foreign Exchange
Quarterly Gains and Losses of Foreign Exchange Although foreign exchange gains and losses fluctuated significantly during this fiscal year due to the exchange rate movement, the impact of future exchange rate will be minimized by unwinding the US dollar position. Up to 3Q of FYE Mar. 2023 Gains and
Slide 8: Financial Interest Impact and Advertising Expenses
Financial Interest Impact and Advertising Expenses Financial interest impact Advertising expenses Gains from management of customer cash in US dollars at Monex Securities and The US Segment curbed advertising expenses due to a change in strategy. TradeStation belongs to the Monex Group. Higher US in
Slide 9: Projected Value of Monex Group
Projected Value of Monex Group Aim to realize the Group’s projected equity value by manifesting the potential value of major subsidiaries and by steadily implementing growth strategies at each company. Projected Equity Value With the listing in US market, aims to manifest of Monex Group (JPY Billion
Slide 10: Risk Management of Monex Group regarding the Crypto Business
Risk Management of Monex Group regarding the Crypto Business Monex Group conducts adequate risk management on the group-wide crypto asset related businesses. • Management of Position/Exposure Almost no crypto-related proprietary position for sales gain purposes in each subsidiary. • Appropriate Risk
Slide 11: Strengthening the Management Structure
Strengthening the Management Structure Announced a plan of changes in management structure* after the Shareholders Meeting to be held in June 2023. • The following change of management and executive structure is planned to occur after the 19th Ordinary Shareholders Meeting. - Oki Matsumoto : Preside
Slide 12: II. Consolidated Performance
Ⅱ. Consolidated Performance 11
Slide 13: Highlights 3Q of FYE Mar. 2023 (3 months)
Highlights 3Q of FYE Mar. 2023 (3 months) The Japan Segment generates stable profit and the US Segment improved profitability, offsetting the decline of profit in the Crypto Asset Segment. Consolidated pre-tax income in 3Q was ¥385M. Operating income was ¥1.4B due to brisk forex market and growing g
Slide 14: QoQ Comparison (3 months) Consolidated Performance
QoQ Comparison (3 months) Consolidated Performance FYE Mar. 2023 FYE Mar. 2023 2Q 3Q Rate of (JPY million) Variance Reference (Jul. 2022– (Oct. 2022– change Sep. 2022) Dec. 2022) P15: Analysis of Japan segment Total operating revenue after deducting financial expenses and cost of sales 18,513 18,072
Slide 15: QoQ Comparison (3 months) Segment Performance
QoQ Comparison (3 months) Segment Performance Japan US Crypto Asset Asia Pacific Investment (JPY million) 2023/3 2023/3 2023/3 2023/3 2023/3 2023/3 2023/3 2023/3 2023/3 2023/3 2Q 3Q 2Q 3Q 2Q 3Q 2Q 3Q 2Q 3Q Total operating revenue after deducting financial expenses and cost of sales 7,744 8,262 8,912
Slide 16: QoQ Analysis: Operating Revenue (Japan)
QoQ Comparison (3 months) Analysis: Operating Revenue Japan: Total revenue exceeded the level before the revision of the commissions table for Japanese equities cash trading, due to strong FX revenues from the volatile market and an increase in gains on management of the customers’ US dollar deposit
Slide 17: QoQ Analysis: SG&A (Japan)
QoQ Comparison (3 months) Analysis: SG&A Japan: Although some expenses increased due to growth in new businesses such as financial instrument intermediary business and the periodic investment of mutual fund with credit card, overall SG&A were appropriately controlled. ■ SG&A Quarterly SG&A Total +1.
Slide 18: QoQ Analysis: Operating Revenue (USD, US)
QoQ Comparison (3 months) Analysis: Operating Revenue (USD) US: Net financial income increased driven by higher US interest rates, offset by lower brokerage commissions and other commissions due primarily to unfavorable equities trading. Total revenue in 3Q was flat QoQ. ■ Total operating revenue af
Slide 19: QoQ Analysis: SG&A (USD, US)
QoQ Comparison (3 months) Analysis: SG&A (USD) US: Optimize total SG&A to focus on profitability. One-off cost such as severance payments responding to the strategy change disappeared. ■ SG&A Quarterly SG&A Total -6.8％ (-4,182) *Figures in parenthesis reflect the variance from previous quarter (USD
Slide 20: QoQ Analysis: Operating Revenue (Crypto)
QoQ Comparison (3 months) Analysis: Operating Revenue Crypto: Total revenue decrease driven by a reduction in net trading income as trading volumes were meaningfully impacted by broader crypto market decline. ■ Total operating revenue after deducting financial expenses Quarterly total operating reve
Slide 21: QoQ Analysis: SG&A (Crypto)
QoQ Comparison (3 months) Analysis: SG&A Crypto: Total SG&A expenses decreased QoQ as a result of advertising budget management in response to current market conditions, resulting in a decrease in SG&A. ■ SG&A SG&A Total -4.8％ (-91) (JPY million) * Figures in parentheses indicate the variance from t
Slide 22: YoY Comparison (9 months) Consolidated Performance
YoY Comparison (9 months) Consolidated Performance FYE Mar. 2022 3Q FYE Mar. 2023 3Q Rate of (JPY million) Variance Reference (Apr.–Dec. 2021) (Apr.–Dec. 2022) change P23: Analysis of Japan segment Total operating revenue after deducting financial expenses and cost of sales 65,937 54,283 -11,655 -18
Slide 23: YoY Comparison (9 months) Segment Performance
YoY Comparison (9 months) Segment Performance Japan US Crypto Asset Asia Pacific Investment (JPY million) 2022/3 2023/3 2022/3 2023/3 2022/3 2023/3 2022/3 2023/3 2022/3 2023/3 3Q 3Q 3Q 3Q 3Q 3Q 3Q 3Q 3Q 3Q Total operating revenue after deducting 22,615 23,351 17,254 24,828 25,461 5,787 940 805 242 1
Slide 24: YoY Analysis: Operating Revenue (Japan)
YoY Comparison (9 months) Analysis: Operating Revenue Japan: Strong FX revenues and increased mutual fund related revenues offset the decline in brokerage commissions due to the revision of the commissions table for Japanese equities cash trading. Gains on management of the customers’ US dollar depo
Slide 25: YoY Analysis: SG&A (Japan)
YoY Comparison (9 months) Analysis: SG&A Japan: Although transaction fees increased by higher transaction volume due to the operation of accounts transferred from Shinsei Bank, the total expenses including system investment were appropriately controlled. ■ SG&A SG&A Total +8.9％ (+1,635) * Figures in
Slide 26: YoY Analysis: Operating Revenue (USD, US)
YoY Comparison (9 months) Analysis: Operating Revenue (USD) US: Total revenue increased 18.6% YoY due to a significant increase in net financial income as a result of higher interest rates. Total operating revenue after deducting financial expenses and ■ Total operating revenue after deducting finan
Slide 27: YoY Analysis: SG&A (USD, US)
YoY Comparison (9 months) Analysis: SG&A (USD) US: Significantly decreased advertising expenses and professional fees, corresponding to the strategy change since 2Q of this fiscal year. However, compensation and benefits increased YoY, including the severance payments for the reduction in force cond
Slide 28: YoY Analysis: Operating Revenue (Crypto)
YoY Comparison (9 months) Analysis: Operating Revenue Crypto: Significant decrease in net trading income due to lower trading volumes resulting from the decline in crypto asset values and market transaction volume. ■ Total operating revenue after deducting financial expenses Total operating revenue
Slide 29: YoY Analysis: SG&A (Crypto)
YoY Comparison (9 months) Analysis: SG&A Crypto: Advertising expenses decreased by about 75% YoY, by controlling advertising budget in response to current market conditions. ■ SG&A SG&A Total -39.9％ (-4,224) * Figures in parentheses indicate the variance from the previous year (JPY million) (JPY mil
Slide 30: Investors' Guide
Investors’ Guide Shareholders distribution Shareholders & indicators per share ◆ Our basic policy for shareholders distribution ◆ Major shareholders and shareholder breakdown (as of Sep. 30, 2022) As for the progress of share buyback, 2.70 billion yen (6.3 million shares) were Monex Group, Inc. 0.0%
Slide 31: History of Shareholders' Distribution
History of Shareholders’ Distribution Shareholder Return Policy: Stable dividend payments and flexible buybacks of its own shares, while investing in the long-term growth. ◆ History of dividend per share ◆ Return on equity ratio (JPY) 17.3% 18% Interim Year-end 20 13.4% 15% 12.9% 15 7.0 12% 7.5 or 7
Slide 32: III. Business Update
MONEX GROUP IT. Business Update 31
Slide 33: Business Update Japan Segment 1/5
Business Update Japan Segment 1/5 Revenue stream has become more diversified at Monex Securities due to the steady increase of revenues other than Japan equities brokerage commissions. Total Operating Revenue at Monex Securities Brokerage commission of Japan equities Brokerage commission of Global e
Slide 34: Business Update Japan Segment 2/5
Business Update Japan Segment 2/5 Expanded periodic investment service for mutual fund. Increased US Equities related revenues due to an increase in gains on management of USD deposit driven by higher interest rate. Mutual Funds US Equities Related Business • Announced a business partnership in the
Slide 35: Business Update Japan Segment 3/5
Business Update Japan Segment 3/5 Pushing for a shift from saving and consuming to investment utilizing the financial instrument intermediary business partnership between Monex Securities and AEON Bank. Broadening Number of investment activity AEON Bank accounts Client In-house backbone touchpoint o
Slide 36: Business Update Japan Segment 4/5
Business Update Japan Segment 4/5 The IFA/wealth management business exceeded its assets in custody to approximately ¥55B. Monex PB, Inc. established to stretch the wealth management business Assets in Custody ・Monex Securities launched an IFA business in IFA business assets in custody 2020 and a we
Slide 37: Business Update Japan Segment 5/5
Business Update Japan Segment 5/5 Asset management business accelerates its growth, exceeding its AUM to ¥110B. Total AUM managed by Monex Asset Management almost doubled YoY Asset Under Management Robo-advisor service AUM ¥ 47.3B （YoY ｘ1.5） Robo-advisor services Total AUM A discretionary investment
Slide 38: Business Update US Segment 1/3
Business Update US Segment 1/3 While higher VIX resulted in strong futures trading, other commissions declined due to lower equities transaction as a result of downward trend of the market. Commission revenue and VIX Futures trading remained strong as the market volatility led to the favorable trans
Slide 39: Business Update US Segment 2/3
Business Update US Segment 2/3 Interest income from customer deposits increased significantly as US interest rates rose. Interest on customer cash Interest income from customer cash deposits belongs to TradeStation and is recorded as net financial income. A portion of interest earned is shared with
Slide 40: Business Update US Segment 3/3
Business Update US Segment 3/3 Since the strategy change from expanding the customer base up until 1Q, TradeStation is now focused on the new strategy to offer satisfactory products and services for active and sophisticated traders which will improve the customer loyalty and transaction volume, resu
Slide 41: Business Update Crypto Asset Segment 1/5
Business Update Crypto Asset Segment 1/5 The crypto asset sector continues to be impacted by the macroeconomic environment and challenges in certain segments of the crypto market; however, Coincheck remains very well-positioned as a leader in product offering, regulatory compliance, and trust. Globa
Slide 42: Business Update Crypto Asset Segment 2/5
Business Update Crypto Asset Segment 2/5 No.1 share of app downloads for 4 consecutive years in Japan. Crypto asset exchange / marketplace No.1 domestic market share for Leading market share with 28%*2 Number of tokens supported 4 consecutive years (by app DLs)*1 share of verified accounts by Coinch
Slide 43: Business Update Crypto Asset Segment 3/5
Business Update Crypto Asset Segment 3/5 Plan to create a digital asset ecosystem to diversify its earnings over the mid to long term. Plan to create a digital asset ecosystem Coincheck for Business Exchange/ Opened a dedicated contact for consulting corporate clients in Marketplace response to thei
Slide 44: Business Update Crypto Asset Segment 4/5
Business Update Crypto Asset Segment 4/5 Coincheck Group (CCG)*1 is proceeding with listing procedures. Aiming to be listed on Nasdaq to secure global talent and business opportunities - After the proposed business combination with Nasdaq-listed SPAC, Thunder Bridge Capital Partners IV, Inc. (THCP),
Slide 45: Business Update Crypto Asset Segment 5/5
Business Update Crypto Asset Segment 5/5 Coincheck has identified numerous large growth opportunities that can be pursued organically and accelerated through M&A and partnerships. Deepen Existing Broaden Digital Asset Offerings Solutions Marketplace / NFTs web3 Institutional Financial On-ramp Intern
Slide 46: Business Update Asia Pacific and Investment Segment
Business Update Asia Pacific and Investment Segment In the Investment Segment, Monex Ventures was selected as an operator of the Social Impact Investment Fund promoted by Tokyo Metropolitan Government. Asia Pacific Segment Investment Segment Cumulative metrics of Monex Boom Securities (H.K.) Social
Slide 47: Business Update New Businesses (the Japan segment)
Business Update New Businesses (the Japan segment) Promote new businesses based on a corporate philosophy that aims to optimize an individual's lifetime balance sheet. STEAM / Bilingual Education Business Genome Platform Business Viling, Inc. STEAM Education Genex, Inc. began whole-genome molecular
Slide 48: Business Update ESG and Sustainability
Business Update ESG and Sustainability Promote sustainability management and continuously strengthen systems to address ESG issues. Steadily promote initiatives in key areas of materiality Revised key rules and policies & Promote DEI at group companies Add disclosure of human capital / innovation Es
Slide 49: Appendix: Group Overview
MONEX GROUP Appendix: Group Overview 48
Slide 50: Appendix: Highlights 3Q of FYE Mar. 2023 (3 months) 1/3
Appendix: Highlights 3Q of FYE Mar. 2023 (3 months) 1/3 ◆Total operating revenue after deducting financial expenses and cost of sales, and quarterly profit attributable to owners of the Company Total operating revenue after deducting financial expenses and cost of sales Quarterly profit attributable
Slide 51: Appendix: Highlights 3Q of FYE Mar. 2023 (3 months) 2/3
Appendix: Highlights 3Q of FYE Mar. 2023 (3 months) 2/3 ◆Total operating revenue after deducting financial expenses and cost of sales, and Segment profit (JPY Million) Total operating revenue after deducting financial expenses and cost of sales Segment profit (Quarterly profit before income taxes) 8
Slide 52: Appendix: Highlights 3Q of FYE Mar. 2023 (3 months) 3/3
Appendix: Highlights 3Q of FYE Mar. 2023 (3 months) 3/3 ◆Total operating revenue after deducting financial expenses, and Segment profit (JPY Million) 800 Total operating revenue after deducting financial expense Segment profit (Quarterly profit before income taxes) Asia 600 Pacific 400 296 282 287 2
Slide 53: Consolidated balance sheet
Consolidated balance sheet Key points of Monex Group’s consolidated balance sheet of Monex 1. Actual net debt is ¥12.5B for the holding company Monex Group, Inc., which does not engage in securities transactions, etc. 2. Trust assets, which are segregated deposits received from customers and guarant
Slide 54: Corporate Governance
Corporate Governance Established global-standard corporate governance practices and emphasis on dialogue with retail/institutional investors. Monex Group shifted to the new listing category of Tokyo Stock Exchange, "Prime Market" on Apr. 4, 2022. Adoption of “company with three committees” structure
Slide 55: Overview of Monex Group and Main Subsidiaries
Overview of Monex Group and Main Subsidiaries ■ Monex, Inc. (Tokyo, Japan) ■ Coincheck, Inc. (Tokyo, Japan) One of the major online brokerage firms in Japan Crypto asset Exchange/Marketplace agency • President : Yuko Seimei • President: Satoshi Hasuo • Founded in 1999 • Founded in 2012, joined Monex
Slide 56: Group Overview of the Group
Group Overview of the Group Listed Holding Company [ Japan Segment ] [ US Segment ] [ Crypto Asset Segment ] Online Brokerage Asset Management Crypto Asset Exchange Agency Monex, Inc. Monex Asset Management, Inc. TradeStation Group, Inc. Coincheck, Inc. Comprehensive investment service provider Smal
Slide 57: Group Overview - Revenues, Costs, and Employees
Group Overview - Revenues, Costs, and Employees Five Segments Contribution in FYE Mar. 2022 ■ Japan Segment Total operating revenue Selling, general and ■ US Segment after deducting financial expenses administrative expenses ■ Crypto Asset Segment 1% 1% 2% 0% ■ Asia Pacific Segment 20% ■ Investment
Slide 58: Appendix: Valuation in Fair Value of Monex Group
Appendix: Valuation in Fair Value of Monex Group Data for the valuation of fair value based on the Sum-of-the-Parts method Calculated by adding up the fair value of the subsidiaries using the sum-of-the-parts method. Target subsidiaries are Monex, Inc., Coincheck, TradeStation Group, Monex Asset Man
Slide 59: Investment Segment – Portfolio 1/3
Investment Segment – Portfolio 1/3 ◆ Monex Ventures, Inc. ◆ MONEX EDISON Investment Limited Partnership 58
Slide 60: Investment Segment – Portfolio 2/3
Investment Segment – Portfolio 2/3 ◆ MV I Investment Limited Partnership 59
Slide 61: Investment Segment – Portfolio 3/3
Investment Segment – Portfolio 3/3 ◆ MV I Investment Limited Partnership ◆ MV II Investment Limited Partnership 60
Slide 62: Disclaimer
Disclaimer About Coincheck Important Information About the Business Combination and Where to Find It In connection with the proposed business combination in connection with to the business combination agreement among Coincheck, Inc. (“Coincheck”), Coincheck Group B.V. (“CCG”), Thunder Bridge Capital
Slide 63: © Monex Group, Inc.
© Monex Group, Inc. www.monexgroup.jp/