Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Tokyo Stock Exchange  >  SoftBank Group Corp.    9984   JP3436100006

SOFTBANK GROUP CORP.

(9984)
  Report
SummaryChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsPress ReleasesOfficial PublicationsSector newsMarketScreener StrategiesAnalyst Recommendations

SoftBank : Summary of Earnings Results Briefing for FY2019

share with twitter share with LinkedIn share with facebook
share via e-mail
05/22/2020 | 07:12am EDT
Summary of Earnings Results Briefing
for FY2019

Date Monday, May 11, 2020 3:30 pm - 5:00 pm
Speakers SoftBank Corp.:
Ken Miyauchi (President & CEO)
Jun Shimba (Representative Director & COO)
Yasuyuki Imai (Representative Director & COO)
Junichi Miyakawa (Representative Director & CTO)
Kazuhiko Fujihara (Board Director, Executive Vice President & CFO)
Introduction

We would like to express our heartfelt sympathy to all those affected by the outbreak of coronavirus disease 2019 (COVID-19). In addition to company-wide efforts aimed to prevent the spread of infection, we are proactively implementing measures such as providing telecommunication solutions free-of-charge to companies and educational institutions based on our corporate philosophy of 'Information Revolution - Happiness for everyone'. We will continue to fulfill our responsibilities as a telecommunications carrier that is responsible for social infrastructure.

Summary

Mr. Ken Miyauchi, President & CEO of SoftBank Corp., discussed three themes at the earnings results briefing: (1) identification of priority issues for SDGs management; (2) consolidated results for FY2019; and (3) consolidated forecasts for FY2020.

1. Identification of Priority Issues for SDGs Management

In April 2020, we identified the six priority issues (Materiality) to be addressed in order to achieve sustainable growth over the medium and long term. Going forward, SoftBank Corp. and its subsidiaries (the 'Group') will continuously work to solve social issues through both its business and corporate activities. By doing so, the Group will continue to pursue the Sustainable Development Goals (SDGs) set forth by the United Nations, and contribute to the realization of a sustainable society.

2. Consolidated Results for FY2019

For the fiscal year ended March 31, 2020, revenue increased by 30% year on year to 4,861.2 billion yen. SoftBank Corp. (the 'Company') made Z Holdings Corporation ('ZHD') a subsidiary in June 2019, and has retrospectively adjusted its results for the fiscal year ended March 31, 2019 (FY2018) under the assumption that ZHD was made a subsidiary at the beginning of FY2018. When compared with the retrospectively adjusted results for the previous fiscal year, revenue increased 4% year on year. Looking at segment performance, revenue increased year on year across all segments after retrospective adjustment.

Operating income rose by 27% year on year to 911.7 billion yen. The increase was 11% year on year after retrospective adjustment. In terms of segment performance, operating income increased year on year across all segments after retrospective adjustment. In the Consumer segment, operating income rose by 19.8 billion yen year on year, mainly due to the increase of smartphone subscribers. In the Enterprise segment, operating income was up by 7.3 billion yen, supported by growth in Business solution. In the Distribution segment, operating income increased by 2.0 billion yen due to demand for PC replacements. In the Yahoo segment, operating income increased by 16.4 billion yen, owing to growth in the Commerce Business. In Others, operating income rose by 48.1 billion yen. This increase was mainly due to the impact of the reclassification of PayPay Corporation from a subsidiary to an equity method affiliate in Q1 FY2019, along with a gain on valuation for another subsidiary.

Increased upfront expenditures on PayPay and other new businesses led to a net loss on equity-method investments of 42.4 billion yen.

Despite losses related to exceptional factors, net income attributable to owners of the Company rose 10% year on year in FY2019 to 473.1 billion yen, a new high. This was an increase of 2% year on year after retrospective adjustment.

Annual dividends per share are planned to be 85 yen, a gain of 10 yen compared with the previous year.

Telecommunications Business

Consumer segment revenue increased year on year as a decline in handset sales was offset by growth in mobile communications services and broadband services. In mobile communications services, we promoted a multi-brand strategy offering users a choice between the three differentiated brands: SoftBank, Y!mobile and LINE MOBILE. The business environment changed in FY2019 due to amendments to the Telecommunications Business Act and the entry of new players from other industries. By introducing enhanced service plans while focusing on expanding sales, each brand successfully grew its smartphone subscriber base in year on year terms. Cumulative smartphone subscriptions rose to 24.13 million users, with 2.05 million net adds. All three brands recorded high customer satisfaction rates of more than 90% with pricing plans. In addition, we focused on maintaining a high quality of service by differentiating services through collaboration with subsidiaries Yahoo Japan and PayPay, and through network initiatives to respond to continually rising data traffic. Our annual average smartphone churn rate fell to a record low of 0.70%. Going forward, our aim is still to develop the Group's mobile brands to ensure they are the preferred choice of customers.

Our commercial services using 5G (fifth generation mobile communication) technology started in March 2020. By maximizing our technological strengths developed with 4G and working with other companies, we are expanding our 5G service area. We aim to have 5G networks coverage across all 47 prefectures in Japan by the end of FY2020, with a population coverage of over 90% by the end of FY2021.

In the Enterprise segment, revenue increased by 3% year on year, with performance driven by growth in Business solution and others, which includes cloud services, digital marketing, IoT, security and others. The recent widespread adoption of remote working is causing rapid growth in the demand for remote access services, web conferencing, and other services. As digitalization requirements of enterprises continue to evolve, we aim to meet such needs with precisely tailored solutions so we can contribute to the digital transformation of society.

Yahoo Business

A fresh addition to the Group, the Yahoo segment reported 10% revenue growth in FY2019. Within the Yahoo Commerce Business, we made a series of dynamic business decisions. These included making ZOZO, Inc., operator of the online fashion retail website ZOZOTOWN, a subsidiary in June 2019. We also initiated a collaboration with logistics major Yamato Holdings Co., Ltd. As a result, e-commerce transaction value in the Yahoo segment rose 14% year on year. In the Media Business, sales collaboration with the Company helped to boost ad placements, based on additional ad placements by existing Yahoo clients along with new customers. Together, these initiatives resulted in a turnaround at ZHD, with consolidated operating income rebounding in FY2019. The anticipated integration of ZHD and LINE Corporation in FY2020 will put the Group in a unique position, with strengths across all areas of technology from telecoms and ads to settlement, AI, and communications. As an unparalleled corporate group, we aim to further enhance our corporate value.

New Business Fields

As initiatives in FY2019, we focused on optimization of the new business portfolio. We aggressively invested in businesses such as PayPay that are in expansion phase. In addition, we entered new markets with high growth potential, such as digital marketing and image authentication services based on AI.

Cumulative registered users as of the end of April 2020 for PayPay, a smartphone payment service, exceeded 28 million, and established its No. 1 position in such services in Japan. We announced that we would begin developing financial services at full scale in 2020 at the Q3 FY2019 results, and trials have already begun for postpay and investment services. Going forward, our aim is for PayPay to evolve into a 'Super App' by strengthening financial services.

DiDi, a taxi-hailing platform that uses AI to forecast demand, expanded its service area significantly in FY2019, and as of the end of March 2020, it offers services in 25 prefectures nationwide. The taxi industry has been negatively affected by people staying at home to fight against the spread of COVID-19, but the impact on DiDi has been relatively modest. Looking ahead, we will target steady growth by developing services to respond to changing conditions.

Memberships successfully rose 80% year on year in FY2019 at WeWork, a provider of community centered workspaces using cutting-edge technology and data analysis. Going forward, development will focus especially on the Tokyo area due to its high average occupancy rates. In addition, with the COVID-9 outbreak, many companies adopted remote work rapidly, and demand for distributed office locations is expected to grow further. WeWork Japan aims for break-even on a single month basis in FY2020 by tapping into growing demand for diversified office space.

OYO Hotels Japan G.K., a joint venture with global hotel chain OYO Hotels & Homes, revamped its growth strategy to establish its community-based OYO brand at affordable prices. Occupancy rates have fallen significantly at many hotels during the COVID-19 outbreak, but OYO Hotels Japan has performed well above the industry average in Japan.

Our cybersecurity platform Cybereason has become Japan's leading endpoint security solution. Orders for Cybereason have surged since March 2020 due to the increasing numbers of cyberattacks associated with increased trend of remote working.

3. Consolidated Forecasts for FY2020

Looking at forecasts for FY2020, we expect revenue of 4,900 billion yen, operating income of 920 billion yen, and net income attributable to owners of the Company of 485 billion yen. We expect dividends per share of 86 yen, in line with our dividend policy aiming to achieve both growth and returns to shareholders. We are targeting increases in profit and dividends even with the impact from COVID-19.

FY2020 Management Policy

In the telecommunications business, we are focused on active 5G deployment and sustained growth in smartphone subscribers. In the Yahoo business, we are focused on growing the e-commerce and financial services. In new businesses, we are looking to further expand PayPay and other operations, while also seeking to create new businesses. At the same time, based on the optimization of cost across the entire company, we are pursuing a growth strategy while also promoting structural reform.

Impact on Performance from COVID-19

While the outbreak of COVID-19 is having a massive impact on economic activity, we believe the effects on our telecommunications business have been immaterial. The number of customers visiting our shops has dropped due to stay-at-home order from the government, and this has led to lower handset sales and fewer new subscribers. However, churn rate has also declined, and we expect total subscriber numbers to remain stable. In addition, increased data traffic due to home usage is expected to support stable revenue. In the enterprise space, while our sales activities have been affected, demand for remote work and related services has risen sharply. In the Yahoo business, we face uncertainty in the media business due to reduced ad placement by certain industries, but we anticipate increased usage of online services, led by e-commerce.

[Notes]
  1. *1
    Due to the Company's listing in December 2018, the dividend paid during FY2018 was only the year-end dividend for a six-month period of 37.5 yen per share. On an annualized basis, this was equivalent to 75 yen per share. Dividends for the fiscal year ended March 31, 2020 is planned to be raised as a resolution matter at the Board of Directors meeting scheduled for May 21, 2020.
  2. *2
    The business integration of Z Holdings Corporation and LINE Corporation is subject to receipt of required competition law and foreign exchange law and other clearances and permits required by applicable law and regulation in each country as well as the satisfaction of the other preconditions specified in the definitive agreement among four companies including SoftBank Corp. and NAVER Corporation.
  3. *3
    The FY2020 consolidated forecasts do not reflect the financial impact of the business integration of Z Holdings Corporation and LINE Corporation. The forecasts are based on the projected impact of COVID-19 on performance as judged by management as of April 2020, but are subject to change in line with future developments.

Disclaimer

SoftBank Group Corporation published this content on 21 May 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 22 May 2020 11:11:10 UTC

share with twitter share with LinkedIn share with facebook
share via e-mail
Latest news on SOFTBANK GROUP CORP.
04:14aJapan's Dentsu evacuates Tokyo HQ after bomb threat
RE
04:12aJapan's Dentsu evacuates Tokyo headquarters after bomb threat
RE
06/04SOFTBANK : DBRS Morningstar Confirms All Ratings of LoanCore 2019-CRE2 Issuer Lt..
AQ
06/04SOFTBANK : DBRS Morningstar Confirms All Ratings of LoanCore 2019-CRE3 Issuer Lt..
AQ
06/03SoftBank launches $100 million fund investing in 'people of colour'
RE
06/03SoftBank launches $100 million fund investing in 'people of colour'
RE
06/03Japan to look at building a common infrastructure for digital payments
RE
06/02China's BYD Gets Extension on $1 Billion California Mask Deal -- Update
DJ
06/02China's BYD Gets Extension on $1 Billion California Mask Deal
DJ
06/02China auto sales growth seen for second straight month, boosting recovery hop..
RE
More news
Financials
Sales 2020 6 130 B 56 123 M 56 123 M
Net income 2020 -761 667 M -6 974 M -6 974 M
Net Debt 2020 10 839 B 99 242 M 99 242 M
P/E ratio 2020 -14,1x
Yield 2020 0,78%
Capitalization 10 423 B 95 610 M 95 431 M
EV / Sales 2019
EV / Sales 2020 3,47x
Nbr of Employees 76 866
Free-Float 72,2%
Chart SOFTBANK GROUP CORP.
Duration : Period :
SoftBank Group Corp. Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends SOFTBANK GROUP CORP.
Short TermMid-TermLong Term
TrendsBullishNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus BUY
Number of Analysts 16
Average target price 6 515,00 JPY
Last Close Price 5 175,00 JPY
Spread / Highest target 40,1%
Spread / Average Target 25,9%
Spread / Lowest Target -17,5%
EPS Revisions
Managers
NameTitle
Masayoshi Son Chairman & Chief Executive Officer
Raul Marcelo Claure Chief Operating Officer, Director & Vice President
Yoshimitsu Goto CFO & Senior Managing Executive Officer
Ken Miyauchi Director
Yun Ma Director
Sector and Competitors
1st jan.Capitalization (M$)
SOFTBANK GROUP CORP.8.81%95 610
AT&T INC.-18.63%226 575
CHINA MOBILE LIMITED-16.79%143 988
T-MOBILE US27.74%123 786
NTT DOCOMO, INC.-2.76%87 488
KDDI CORPORATION-1.20%66 298