Monex Group, Inc. · TSE:8698
Monex — Q1 FY2008 Earnings Presentation
37 slides from Monex's earnings presentation, Jul 20, 2007
Slide 1: Financial Results of 1Q of Fiscal Year Ending March 31, 2008
July 20, 2007 Financial Results of 1Q of Fiscal Year Ending March 31, 2008 This is an English translation of Japanese presentation material prepared for IR conference held on the date above; it includes the information on consolidated financial summary under Japanese GAAP for FYE March 2007. If ther
Slide 2: Our Business Principles
Our Business Principles - PURSUING SPIRIT OF INNOVATION We will constantly strive to pioneer new fields in finance and propose new approaches to managing money. - STAYING CUSTOMER FOCUSED We believe that the best guide to our corporate activities is the voice of our customers. With this guide, we wi
Slide 3: Table of Contents
Table of Contents I. Financial Results Page 1. Financial Highlights ・・・ 4 III. To Our Shareholders Page 2. Financial Summary (1) 1Q of FYE Mar. 31, 2007 vs. 1Q FYE Mar. 31, 2008 1. ROE and Dividend ・・・ 29 (3 months) ・・・ 5 2. Disclosure ・・・ 30 (2) 4Q of FYE Mar. 31, 2007 vs. 1Q of FYE Mar. 31, 2008 (
Slide 4: 1. Financial Results
1. Financial Results 2. Business Strategy and Future Development 3. To our Shareholders 4. Appendix 3
Slide 5: Financial Highlights
Financial Highlights ■1Q of FYE Mar. 31, 2008 Overview of the Japanese Equity Market • Nikkei 225 + 4.9% over Mar. 31, 2007 • Trading Value(*1) - 17.6% from 4Q of Mar. 31, 2007 ■1Q of FYE Mar. 31, 2008 Financial Highlights Net operating revenues 6,871 million yen -13.9% from 4Q of Mar. 31, 2007 •B
Slide 6: Financial Summary: 1Q FYE Mar 2007 vs 1Q FYE Mar 2008
Financial Summary : 1Q of FYE Mar. 31, 2007 vs. 1Q of FYE Mar. 31, 2008 (in 3 months) (in million yen, %) 1Q of FYE Mar. 31, 2007 1Q of FYE Mar. 31, 2008 Change (Apr. 2006-Jun. 2006) (Apr. 2007-Jun. 2007) Operating Revenues 9,335 8,029 -14.0 % Net Operating Revenues 8,904 6,871 -22.8 % SG&A 3,730 3,
Slide 7: Financial Summary: 4Q FYE Mar 2007 vs 1Q FYE Mar 2008
Financial Summary : 4Q of FYE Mar. 31, 2007 vs. 1Q of FYE Mar. 31, 2008 (in 3 months) (in million yen, %) 4Q of FYE Mar. 31, 2007 1Q of FYE Mar. 31, 2008 Change (Jan. 2007-Mar. 2007) (Apr. 2007-Jun. 2007) Operating Revenues 8,657 8,029 -7.2 % Net Operating Revenues 7,978 6,871 -13.9 % SG&A 3,779 3,5
Slide 8: Financial Highlights (Quarterly Trend)
Financial Summary：Financial Highlights (Quarterly Trend) ■Net operating revenues and Operating Income ■SG&A million yen billion yen million yen Trading Value of Individual Investors 20,000 1,600 in 3 major markets and JASDAQ 10,000 (Average per business day)(right) 18,000 7,500 1,400 5,000 3,730 3,7
Slide 9: Profit Margin and Cost Structure
Financial Summary：Profit Margin and Cost Structure ■Profit Margin (Operating income/Operating revenues) ■Cost Structure (Apr. 2007 - Jun. 2007) 60% Strategically 55% Fixed costs and costs controllable costs correlated to the number of accounts Commission to 50% 49% 49% stock exchange 46% etc. Advert
Slide 10: Quarterly Trends in Income Statement
Financial Summary：Quarterly Trends in Income Statement (in million yen) 2Q of FYE 3Q of FYE 4Q of FYE 1Q of FYE 2Q of FYE 3Q of FYE 4Q of FYE 1Q of FYE 1Q of FYE Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, 2006 2006 2006 2006 2007 2007 2007 2007 2008 Brokerage co
Slide 11: Quarterly Trends in SG&A
Financial Summary：Quarterly Trends in SG&A (in million yen) 1Q of FYE 2Q of FYE 3Q of FYE 4Q of FYE 1Q of FYE 2Q of FYE 3Q of FYE 4Q of FYE 1Q of FYE Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, Mar. 31, 2006 2006 2006 2006 2007 2007 2007 2007 2008 Transaction-related expe
Slide 12: Revenues/SG&A per Customers' Assets in Custody
Comparison Analysis : Revenues/SG&A per Customers’ Assets in Custody (Annualized) Direction : Low cost / portfolio management-oriented business Matsui 3.0% 1. Revenues per customers’ assets in custody (Consolidated) Continue to grow equity brokerage business, and intensively 4Q of Mar. 2007 strength
Slide 13: 2. Business Strategy and Future Development
1. Financial Results 2. Business Strategy and Future Development 3. To our Shareholders 4. Appendix 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 non-active investors to efficiently manage his/her financial assets Strengthen “Products Originatio
Slide 15: Current Environmental Recognition
Current Environmental Recognition ■ Increasing Asset Management by Individuals Financial Assets Held by Households (End of Mar.2007) Investment ◆ With Japanese population having started to decline Bonds Trusts Non-listed Others Equities 2.8 4.5 and economic growth slowing down, people trust less in
Slide 16: Monex's Business Model
Monex’s Business Model Asset management business shall be a major growth field rather than stock Aspect of an Investment Bank brokerage services Originating unique original products Gain competitive advantages by not only distributing investment products online by highly-skilled professionals at l
Slide 17: Priority Policies
Priority Policies ■Three Strategies and Investment Education to Pursue Monex’s Business Model Three Strategies 1. Product Strategy •Differentiation by diversifying products Fixed income, mutual funds, alternative investment products, etc. •Differentiation by providing original products Providing in
Slide 18: Current and Future Structure of Revenues and Customers' Assets by Product
Current and Future Structure of Revenues and Customers’ Assets by Product 【Current Structure (1Q of FYE Mar. 2008)】 【Future Structure】 Direction of Each Business Line Managed assets Underwriting 0% Corporate Finance (Mutual funds, etc.) 1.Brokerage Business Managed assets (Underwriting) Others 2% 10
Slide 19: Brokerage Business: Strengthening our original products and services
Brokerage Business : Strengthening our original products and services ■Introducing New Trading Tools ■Renewal and Enhancement of Existing Services ◆“Monex Trader” series ◆Constantly renewing our website ・ Released full version of ・ Conducting interviews with customers for continuous advanced real-ti
Slide 20: Underwriting Business
Underwriting Business： To increase both lead manager mandates and underwriting shares ■Chinese Companies’ IPO in Japan ■ Track Records ◆Achievements by China Capital Market Department Number of IPOs Value of IPO Deals 120 120 (hundred million yen) Participation in IPO syndicates of Chinese companies
Slide 21: Fixed Income Business
Fixed Income Business ： Growth in number of bond holders by expanding products continuously ■New Products and Services ■Growth in the Number of Bond Holders ◆Started the offering of “Monex Short-Term Notes for ◆Foreign Bond Holders are increasing by an average of Individuals” in the context of “Depo
Slide 22: Fixed Income Business: Monex Short-Term Notes for Individual Investors
Fixed Income Business ：Monex Short-Term Notes for Individual Investors ■Greetings from Oki Matsumoto, CEO of Monex, Inc. (Extracted from Monex website dated June 29,2007) Monex, Inc. (Monex) has started the offering of yen denominated short-term notes (3 months) of our parent company, Monex Beans Ho
Slide 23: FX Business: Taking countermeasures under intense competition
FX Business：Taking countermeasures under intense competition ■ Industry Overview ■Trading Value and Popular Currency Pairs ◆Growing market ◆Trading value and number of accounts ・The amount of entire domestic Forex margin balance reached (billion yen) 613 billion yen as of March 2007, up 62.2% compar
Slide 24: Mutual Fund Business: Pioneer among online distributors
Mutual Fund Business: Pioneer among online distributors ■Providing Attractive Investment Opportunities ■Top-class Online Mutual Fund Sales Top ranked online mutual fund sales performance ◆Steady growth in sales and balance of mutual funds （billion yen） Assets in custody by category ・ Cumulative sal
Slide 25: Alternative Investments
Alternative Investments: World class investment opportunities for individual investors ■Alternative Investment Opportunities for Retail ■Private Equity Investment Opportunities for Retail ◆“Asia Focus” (+5.4%* return in Jan-Jun 2007) ◆“Premium Hybrid 2006” ・Provides absolute return with rigorous ris
Slide 26: Topics: Alliance with eBANK
Topics ■Alliance with eBANK Offering investment products to eBANK’s customers Developing product and services collaborated with Over 60, 3% eBANK, an Internet-Only Bank market leader Under 20, 3% 50's, 9% 20's, 21% Items being considered 40's, 24% 1st Advantage of eBANK • New account acquisition
Slide 27: Topics: Life Insurance Business and Kabu-Robo Project
Topics ■Life Insurance Business ■“Kabu-Robo” Project http://www.netseiho.com/ http://www.kaburobo.jp/ ◆In May 2007, Net Life Planning Co., Ltd. issued ◆Actual stock trading test of 500 million yen by 10 new shares to third parties, totaling 1.92 billion Kabu-Robos who won at Kabu-Robo contest held y
Slide 28: Investor Education
Investor Education: Providing appropriate educational opportunities of investment for many people ■ 2 reasons why we provide investor education ■Activities ◆Continuously holding seminars To enhance the return of To develop infrastructure ・ From April to June 2007 our customer of company’s growth - O
Slide 29: 3. To our Shareholders
1. Financial Results 2. Business Strategy and Future Development 3. To our Shareholders 4. Appendix 28
Slide 30: ROE and Dividend
ROE and Dividend ■Pursuing Investment Return to Our Shareholders ◆Dividend Payout Policy ◆ROE ・Change in Calculation formula Until FYE March, 2007 ROE Net profit of subsidiary, Monex, Inc.’s previous fiscal year 50% From FYE March, 2008 Consolidated net profit of MBH’s current fiscal year ⇒FYE March
Slide 31: Disclosure
Disclosure ■Clear and Timely Disclosure Clearest disclosure among the industry Major shareholders and share distribution Disclosure Frequency Language Started (Recorded as of the end of March 2007) Accounts, etc. Weekly/Monthly English 1999 Major shareholders Top 3 shareholders Japanese Financial
Slide 32: 4. Appendix
1. Financial Results 2. Business Strategy and Future Development 3. To our Shareholders 4. Appendix 31
Slide 33: Customer Portfolio (As of June 30, 2007)
Customer Portfolio (As of June 30, 2007) ■Gender ■Location Others Female 24.7% 22.9% Tokyo Metropolitan District Nagoya District 50.7% Male 8.4% 75.3% Osaka District 17.9% ■Age ■Occupation Over 70 2.9% Company Employee 48.0% 60s 10.0% Unemployed 16.8% Housewife 9.9% 50s 16.9% 40s Self-employed 9.6%
Slide 34: Marketing Strategy
Marketing Strategy ■Branding Strategy ■Achievements ◆Credible brand-building ◆Online seminars – promotions of products and services To build the credible brand, we will continue to provide new Held many online seminars on new products and services products and services and try to attain greater cust
Slide 35: Competitive Services and Products
Competitive Services and Products: For all customers’ satisfaction (As of July 17, 2007) Fixed Mutual Equity Alternative Others Income Funds Small Stock Credit Night China/ Stop Chinese U.S Time Unit Program Lending JGB/ Monthly India High Low Commo- Settle- Loss Trading Trading Foreign Auction Purc
Slide 36: Comparison with Major Securities Firm
Comparison with Major Securities Firm ■Customers’ assets in custody ■Net Operating Revenues ■SG&A （as of March 31, 2007） (FYE Mar. 31, 2007) (FYE Mar. 31, 2007) Although Monex has diversified Customers’ assets Major securities firm A has diversified revenue Controlled the portion of compensation and
Slide 37: The Monex Group
The Monex Group （as of End of June, 2007） Investment Education for all Individual Investors Providing the Best Alternative Investment Products to Individual Investors （Investment Ratio） MBH : 70% Monex, Inc. (Investment Ratio) MBH : 55% Premium Online Financial Institution : 45% 10% 10% 10% (Investm