Form 6-K
Table of Contents

 

 

FORM 6-K

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

Commission File Number: 1-15270

For the month of January 2019

NOMURA HOLDINGS, INC.

(Translation of registrant’s name into English)

9-1, Nihonbashi 1-chome

Chuo-ku, Tokyo 103-8645

Japan

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F       X             Form 40-F              

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):             

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):             

 

 

 

 


Table of Contents

Information furnished on this form:

EXHIBIT

 

Exhibit Number
1.    Financial Summary – Nine months ended December 31, 2018


Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

   NOMURA HOLDINGS, INC.
Date: January 31, 2019    By:  

/s/ Hajime Ikeda

     Hajime Ikeda
     Senior Managing Director


Table of Contents

Financial Summary For the Nine Months Ended December 31, 2018 (U.S. GAAP)

 

Date:

   January 31, 2019

Company name (code number):

   Nomura Holdings, Inc. (8604)

Stock exchange listings:

   (In Japan) Tokyo, Nagoya
   (Overseas) New York, Singapore

Representative:

   Koji Nagai
   President and Group CEO, Nomura Holdings, Inc.

For inquiries:

   Junko Tago
   Executive Director, Head of Investor Relations, Nomura Holdings, Inc.
   Tel: (Country Code 81) 3-5255-1000
   URL: https://www.nomura.com

1. Consolidated Operating Results

(1) Operating Results

 

     (Rounded to nearest million)  
     (Millions of yen, except per share data)  
     For the nine months ended December 31  
     2017     2018  
           % Change  from
December 31, 2016
          % Change from
December 31, 2017
 

Total revenue

     1,460,944       13.4     1,336,766       (8.5 %) 

Net revenue

     1,118,932       6.1     815,516       (27.1 %) 

Income (loss) before income taxes

     281,235       16.9     (62,054     —  

Net income (loss) attributable to Nomura Holdings, Inc. (“NHI”) shareholders

     196,668       10.3     (101,286     —  

Comprehensive income (loss)

     181,189       (4.7 %)      (38,635     —  

Basic-Net income (loss) attributable to NHI shareholders per share (Yen)

     56.20         (30.01  

Diluted-Net income (loss) attributable to NHI shareholders per share (Yen)

     55.12         (30.03  

Return on shareholders’ equity-annualized

     9.3       (5.0 %)   

Note: Return on shareholders’ equity is a ratio of Net income (loss) attributable to NHI shareholders to Total NHI shareholders’ equity.

(2) Financial Position

 

     (Millions of yen, except per share data)  
     At March 31     At December 31  
                                 2018                                                           2018                            

Total assets

     40,343,947       45,113,023  

Total equity

     2,799,824       2,706,011  

Total NHI shareholders’ equity

     2,749,320       2,662,943  

Total NHI shareholders’ equity as a percentage of total assets

     6.8     5.9

Total NHI shareholders’ equity per share (Yen)

     810.31       805.07  


Table of Contents

2. Cash Dividends

 

                                                                       
     (Yen amounts)  
     For the year ended March 31  
     2018      2019      2019 (Plan)  

Dividends per share

        

Dividends record dates

        

At June 30

     —          —          —    

At September 30

     9.00        3.00        —    

At December 31

     —          —          —    

At March 31

     11.00        —          Unconfirmed  

For the year

     20.00        —          Unconfirmed  

Note: Fiscal year 2019 Q4 dividend forecasts are not presented per reasons stated in “3. Earnings Forecasts for the year ending March 31, 2019.”

3. Earnings Forecasts for the year ending March 31, 2019

Nomura provides investment, financing and related services in the capital markets on a global basis. In the global capital markets there exist uncertainties due to, but not limited to, economic and market conditions. Nomura, therefore, does not present earnings forecasts.

Notes

(1) Changes in significant subsidiaries during the period: None

      (Changes in Specified Subsidiaries accompanying changes in scope of consolidation)

(2) Adoption of the simplified and particular accounting treatments: None

(3) Changes in accounting policies

 

  a)

Changes in accounting policies due to amendments to the accounting standards: Yes

  b)

Changes in accounting policies due to other than a): Yes

(4) Number of shares issued (common stock)

 

     At March 31      At December 31  
   2018      2018  

Number of shares outstanding (including treasury stock)

     3,643,562,601        3,493,562,601  

Number of treasury stock

     250,625,115        185,850,141  
     For the nine months ended December 31  
   2017      2018  

Average number of shares outstanding (year-to-date)

     3,499,513,649        3,374,581,279  

*This financial summary is not subject to certified public accountant’s or audit firm’s quarterly review.


Table of Contents

Table of Contents for the Accompanying Materials

 

1.    Qualitative Information of the Quarterly Consolidated Results

     P. 2  

(1)    Consolidated Operating Results

     P. 2  

(2)    Consolidated Financial Position

     P. 4  

(3)    Consolidated Earnings Forecasts

     P. 4  

2.    Notes to the Summary Information

     P. 5  

(1)    Changes in Accounting Policies

     P. 5  

3.    Quarterly Consolidated Financial Statements

     P. 5  

(1)    Consolidated Balance Sheets

     P. 6  

(2)    Consolidated Statements of Income

     P. 8  

(3)    Consolidated Statements of Comprehensive Income

     P. 9  

(4)    Note with respect to the Assumption as a Going Concern

     P. 9  

(5)    Segment Information – Operating Segment

     P.10  

(6)    Significant Changes in Equity

     P.11  

(7)    Significant Subsequent Events

     P.12  

4.    Supplementary Information

     P.13  

(1)    Consolidated Statements of Income – Quarterly Comparatives

     P.13  

(2)    Business Segment Information – Quarterly Comparatives

     P.14  

(3)    Other

     P.15  

 

– 1 –


Table of Contents
1.

Qualitative Information of the Quarterly Consolidated Results

 

(1)

Consolidated Operating Results

U.S. GAAP

 

     Billions of yen     % Change  
   For the nine months ended     (B-A)/(A)  
   December 31,
2017 (A)
    December 31,
2018 (B)
 

Net revenue

     1,118.9             815.5            (27.1

Non-interest expenses

     837.7       877.6       4.8  
  

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

     281.2       (62.1     —    

Income tax expense

     79.8       36.3       (54.5
  

 

 

   

 

 

   

 

 

 

Net income (loss)

     201.4       (98.4     —    
  

 

 

   

 

 

   

 

 

 

Less: Net income attributable to noncontrolling interests

     4.8       2.9       (39.3
  

 

 

   

 

 

   

 

 

 

Net income (loss) attributable to NHI shareholders

     196.7       (101.3     —    
  

 

 

   

 

 

   

 

 

 

Return on shareholders’ equity-annualized

     9.3     (5.0 %)      —    
  

 

 

   

 

 

   

 

 

 

 

Note: Return on shareholders’ equity is a ratio of Net income (loss) attributable to NHI shareholders to Total NHI shareholders’ equity.

Nomura Holdings, Inc. and its consolidated entities (collectively, “Nomura”) reported net revenue of 815.5 billion yen for the nine months ended December 31, 2018, a decrease of 27.1% from the same period in the prior year. Non-interest expenses increased by 4.8% from the same period in the prior year to 877.6 billion yen due to a loss of 81.4 billion yen from the goodwill impairment attributable to Wholesale as a result of the assessment of the goodwill as of December 31, 2018. Loss before income taxes was 62.1 billion yen and net loss attributable to NHI shareholders was 101.3 billion yen for the nine months ended December 31, 2018.

Segment Information

 

     Billions of yen     % Change  
   For the nine months ended     (B-A)/(A)  
   December 31,
2017 (A)
    December 31,
2018 (B)
 

Net revenue

     1,112.0            824.5            (25.9

Non-interest expenses

     837.7       877.6       4.8  
  

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

     274.3       (53.0     —    
  

 

 

   

 

 

   

 

 

 

In the above segment information totals, which exclude unrealized gain (loss) on investments in equity securities held for operating purposes, net revenue for the nine months ended December 31, 2018 was 824.5 billion yen, a decrease of 25.9% from the same period in the prior year. Non-interest expenses increased by 4.8% from the same period in the prior year to 877.6 billion yen. Loss before income taxes was 53.0 billion yen for the nine months ended December 31, 2018. Please refer to page 10 for further details of the differences between U.S. GAAP and business segment amounts.

 

– 2 –


Table of Contents

<Business Segment Results>

Operating Results of Retail

 

     Billions of yen     % Change  
     For the nine months ended     (B-A)/(A)  
     December 31,
2017 (A)
     December 31,
2018 (B)
 

Net revenue

     314.8           265.3        (15.7

Non-interest expenses

     233.0        219.1       (6.0
  

 

 

    

 

 

   

 

 

 

Income (loss) before income taxes

     81.7        46.2        (43.5
  

 

 

    

 

 

   

 

 

 

Net revenue decreased by 15.7% from the same period in the prior year to 265.3 billion yen, primarily due to decreasing commissions from brokerage. Non-interest expense decreased by 6.0% to 219.1 billion yen. As a result, income before income taxes decreased by 43.5% to 46.2 billion yen.

Operating Results of Asset Management

 

     Billions of yen     % Change  
     For the nine months ended     (B-A)/(A)  
     December 31,
2017 (A)
     December 31,
2018 (B)
 

Net revenue

     100.0             66.9        (33.1

Non-interest expenses

     45.1        47.2       4.5  
  

 

 

    

 

 

   

 

 

 

Income (loss) before income taxes

     54.9        19.8        (64.0
  

 

 

    

 

 

   

 

 

 

Net revenue decreased by 33.1% from the same period in the prior year to 66.9 billion yen. Non-interest expense increased by 4.5% to 47.2 billion yen. As a result, income before income taxes decreased by 64.0% to 19.8 billion yen. Assets under management were 48.3 trillion yen as of December 31, 2018.

Operating Results of Wholesale

 

     Billions of yen     % Change  
     For the nine months ended     (B-A)/(A)  
     December 31,
2017 (A)
     December 31,
2018 (B)
 

Net revenue

     503.9           413.1        (18.0

Non-interest expenses

     447.5        511.5       14.3  
  

 

 

    

 

 

   

 

 

 

Income (loss) before income taxes

     56.4          (98.4     —    
  

 

 

    

 

 

   

 

 

 

Net revenue decreased by 18.0% from the same period in the prior year to 413.1 billion yen. Non-interest expense increased by 14.3% to 511.5 billion yen due to a loss of 81.0 billion yen from the goodwill impairment attributable to Wholesale. As a result, loss before income taxes was 98.4 billion yen.

 

– 3 –


Table of Contents

Other Operating Results

 

     Billions of yen     % Change  
     For the nine months ended     (B-A)/(A)  
     December 31,
2017 (A)
     December 31,
2018 (B)
 

Net revenue

     193.3             79.1        (59.1

Non-interest expenses

     112.0        99.7       (11.0
  

 

 

    

 

 

   

 

 

 

Income (loss) before income taxes

     81.4        (20.6     —    
  

 

 

    

 

 

   

 

 

 

Net revenue was 79.1 billion yen. Loss before income taxes was 20.6 billion yen.

 

(2)

Consolidated Financial Position

Total assets as of December 31, 2018 were 45,113.0 billion yen, an increase of 4,769.1 billion yen compared to March 31, 2018, mainly due to the increase in Securities purchased under agreements to resell. Total liabilities as of December 31, 2018 were 42,407.0 billion yen, an increase of 4,862.9 billion yen compared to March 31, 2018, mainly due to the increase in Securities sold under agreements to repurchase. Total equity as of December 31, 2018 was 2,706.0 billion yen, a decrease of 93.8 billion yen compared to March 31, 2018. During the nine months ended December 31, 2018, Nomura cancelled 150,000,000 shares of its own shares.

 

(3)

Consolidated Earnings Forecasts

Nomura provides investment, financing and related services in the capital markets on a global basis. In the global capital markets there exist uncertainties due to, but not limited to, economic and market conditions. Nomura, therefore, does not present earnings and dividend forecasts.

 

– 4 –


Table of Contents
2.

Notes to the Summary Information

 

(1)

Changes in Accounting Policies

Revenue recognition

On April 1, 2018, Nomura adopted Accounting Standards Update 2014-09 “Revenue from Contracts with Customers” and replaced existing revenue recognition guidance with a new prescriptive model. As a result of this adoption based on the modified retrospective application, the beginning balance of Retained earnings has been adjusted.

Changes of offsetting of derivatives

Nomura collects and remits cash margin between its clients and central clearing houses in its execution and clearing services of exchange-traded derivative transactions. Cash margin collected from clients and remitted to central clearing houses was reflected on Nomura’s consolidated balance sheets. However, with effect from April 1, 2018, revisiting nature of the transactions, Nomura has revised its accounting policy for when such balances are recognized on Nomura’s consolidated group balance sheet and as a result, certain cash margin amounts held on behalf of clients as well as an equivalent amount reflecting the obligation to return such amounts to clients are no longer recognized on the balance sheet if certain criteria are met. Nomura has restated previously reported amounts of Receivables from other than customers decreased by 237.0 billion yen and Payables to other than customers decreased by 237.0 billion yen, respectively, to conform to the current presentation.

Daily variation margin for certain derivative transactions traded in Japan was reflected on Nomura’s consolidated balance sheets. However, from April 1, 2018, Nomura changed its accounting policy as a result of amendment of the rules of a specific central clearing house and daily variation margin is now off-balanced. Nomura has restated previously report amounts of Trading assets decreased by 4.9 billion yen, Receivables from other than customers decreased by 5.5 billion yen and Trading liabilities decreased by 10.4 billion yen respectively to conform to the current presentation.

 

3.

Quarterly Consolidated Financial Statements

The quarterly consolidated financial information herein has been prepared in accordance with Nomura’s accounting policies which are disclosed in the notes to the consolidated financial statements of Nomura Holdings, Inc.’s Annual Securities Report (the annual report filed in Japan on June 25, 2018) and Form 20-F (the annual report filed with the U.S. Securities and Exchange Commission on June 25, 2018) for the year ended March 31, 2018.

 

– 5 –


Table of Contents
(1)

Consolidated Balance Sheets

 

     Millions of yen  
     March 31,
2018
    December 31,
2018
    Increase/
(Decrease)
 
ASSETS       

Cash and cash deposits:

      

Cash and cash equivalents

     2,354,639       2,438,649       84,010  

Time deposits

     315,445       347,166       31,721  

Deposits with stock exchanges and other segregated cash

     288,962       294,663       5,701  
  

 

 

   

 

 

   

 

 

 

Total cash and cash deposits

     2,959,046       3,080,478       121,432  
  

 

 

   

 

 

   

 

 

 

Loans and receivables:

      

Loans receivable

     2,462,503       2,373,851       (88,652

Receivables from customers

     442,343       408,918       (33,425

Receivables from other than customers

     973,867       1,093,348       119,481  

Allowance for doubtful accounts

     (3,514     (3,941     (427
  

 

 

   

 

 

   

 

 

 

Total loans and receivables

     3,875,199       3,872,176       (3,023
  

 

 

   

 

 

   

 

 

 

Collateralized agreements:

      

Securities purchased under agreements to resell

     9,853,898       14,549,228       4,695,330  

Securities borrowed

     6,383,845       4,073,886       (2,309,959
  

 

 

   

 

 

   

 

 

 

Total collateralized agreements

     16,237,743       18,623,114       2,385,371  
  

 

 

   

 

 

   

 

 

 

Trading assets and private equity investments:

      

Trading assets*

     14,962,690       17,520,795       2,558,105  

Private equity investments

     17,466       15,754       (1,712
  

 

 

   

 

 

   

 

 

 

Total trading assets and private equity investments

     14,980,156       17,536,549       2,556,393  
  

 

 

   

 

 

   

 

 

 

Other assets:

      

Office buildings, land, equipment and facilities

(net of accumulated depreciation and amortization of
¥397,834 million as of March 31, 2018 and
¥425,398 million as of December 31, 2018)

     338,984       321,930       (17,054

Non-trading debt securities*

     485,891       457,534       (28,357

Investments in equity securities*

     150,760       135,624       (15,136

Investments in and advances to affiliated companies*

     408,034       416,424       8,390  

Other

     908,134       669,194       (238,940
  

 

 

   

 

 

   

 

 

 

Total other assets

     2,291,803       2,000,706       (291,097
  

 

 

   

 

 

   

 

 

 

Total assets

     40,343,947       45,113,023       4,769,076  
  

 

 

   

 

 

   

 

 

 

 

*

Including securities pledged as collateral

 

– 6 –


Table of Contents
     Millions of yen  
     March 31,
2018
    December 31,
2018
    Increase/
(Decrease)
 
LIABILITIES AND EQUITY       

Short-term borrowings

     743,497       808,262       64,765  

Payables and deposits:

      

Payables to customers

     1,176,773       1,180,941       4,168  

Payables to other than customers

     1,239,540       1,257,743       18,203  

Deposits received at banks

     1,151,342       1,276,438       125,096  
      

 

 

   

 

 

   

 

 

 

Total payables and deposits

       3,567,655          3,715,122        147,467  
  

 

 

   

 

 

   

 

 

 

Collateralized financing:

      

Securities sold under agreements to repurchase

     14,759,010       19,982,480       5,223,470  

Securities loaned

     1,524,363       1,295,494       (228,869

Other secured borrowings

     413,621       432,460       18,839  
  

 

 

   

 

 

   

 

 

 

Total collateralized financing

     16,696,994       21,710,434         5,013,440  
  

 

 

   

 

 

   

 

 

 

Trading liabilities

     8,202,936       7,691,892       (511,044

Other liabilities

     950,534       738,472       (212,062

Long-term borrowings

     7,382,507       7,742,830       360,323  
  

 

 

   

 

 

   

 

 

 

Total liabilities

     37,544,123       42,407,012       4,862,889   
  

 

 

   

 

 

   

 

 

 

Equity

      

NHI shareholders’ equity:

      

Common stock

      

                Authorized

    -    6,000,000,000 shares       

Issued

    -  

 3,643,562,601 shares as of March 31, 2018 and

 3,493,562,601 shares as of December 31, 2018

      

Outstanding

    -  

 3,392,937,486 shares as of March 31, 2018 and

 3,307,712,460 shares as of December 31, 2018

     594,493       594,493       —    

Additional paid-in capital

     675,280       683,525       8,245  

Retained earnings

     1,696,890       1,496,085       (200,805

Accumulated other comprehensive income (loss)

     (59,356     (350     59,006  
      

 

 

   

 

 

   

 

 

 

Total NHI shareholders’ equity before treasury stock

     2,907,307       2,773,753       (133,554

Common stock held in treasury, at cost -

      

250,625,115 shares as of March 31, 2018 and

185,850,141 shares as of December 31, 2018

     (157,987     (110,810     47,177  
  

 

 

   

 

 

   

 

 

 

Total NHI shareholders’ equity

     2,749,320       2,662,943       (86,377
  

 

 

   

 

 

   

 

 

 

Noncontrolling interests

     50,504       43,068       (7,436
  

 

 

   

 

 

   

 

 

 

Total equity

     2,799,824       2,706,011       (93,813
  

 

 

   

 

 

   

 

 

 

Total liabilities and equity

     40,343,947        45,113,023        4,769,076   
  

 

 

   

 

 

   

 

 

 

 

– 7 –


Table of Contents
(2)

Consolidated Statements of Income

 

     Millions of yen     % Change  
     For the nine months ended        
     December  31,
2017(A)
    December  31,
2018(B)
    (B-A)/(A)  

Revenue:

      

Commissions

     277,947       226,954       (18.3

Fees from investment banking

     79,079       76,207       (3.6

Asset management and portfolio service fees

     183,322       186,312       1.6  

Net gain on trading

     296,583       244,586       (17.5

Gain (loss) on private equity investments

     (2,352     1,335       —    

Interest and dividends

     437,449       572,835       30.9  

Gain (loss) on investments in equity securities

     7,654       (8,864     —    

Other

     181,262       37,401       (79.4
  

 

 

   

 

 

   

 

 

 

Total revenue

     1,460,944       1,336,766       (8.5

Interest expense

     342,012       521,250       52.4  
  

 

 

   

 

 

   

 

 

 

Net revenue

     1,118,932       815,516       (27.1
  

 

 

   

 

 

   

 

 

 

Non-interest expenses:

      

Compensation and benefits

     389,656       372,428       (4.4

Commissions and floor brokerage

     74,269       64,335       (13.4

Information processing and communications

     140,881       123,232       (12.5

Occupancy and related depreciation

     51,070       48,692       (4.7

Business development expenses

     26,033       27,354       5.1  

Other

     155,788       241,529          55.0  
  

 

 

   

 

 

   

 

 

 

Total non-interest expenses

     837,697       877,570       4.8  
  

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

     281,235       (62,054     —    

Income tax expense

     79,788       36,331       (54.5
  

 

 

   

 

 

   

 

 

 

Net income (loss)

     201,447       (98,385     —    
  

 

 

   

 

 

   

 

 

 

Less: Net income attributable to noncontrolling interests

     4,779       2,901       (39.3
  

 

 

   

 

 

   

 

 

 

Net income (loss) attributable to NHI shareholders

     196,668       (101,286     —    
  

 

 

   

 

 

   

 

 

 

Per share of common stock:

      
     Yen     % Change  

Basic-

      

Net income (loss) attributable to NHI shareholders per share

     56.20       (30.01     —    
  

 

 

   

 

 

   

 

 

 

Diluted-

      

Net income (loss) attributable to NHI shareholders per share

     55.12       (30.03     —    
  

 

 

   

 

 

   

 

 

 

 

– 8 –


Table of Contents
(3)

Consolidated Statements of Comprehensive Income

 

     Millions of yen     % Change  
   For the nine months ended     (B-A)/(A)  
   December  31,
2017(A)
    December  31,
2018(B)
 

Net income (loss)

        201,447       (98,385     —    

Other comprehensive income (loss):

      

Cumulative translation adjustments:

      

Cumulative translation adjustments

     (29,831     35,040       —    

Deferred income taxes

     13,335       (1,702     —    
  

 

 

   

 

 

   

 

 

 

Total

     (16,496          33,338       —    
  

 

 

   

 

 

   

 

 

 

Defined benefit pension plans:

      

Pension liability adjustment

     1,124       2,039       81.4  

Deferred income taxes

     (336     (995     —    
  

 

 

   

 

 

   

 

 

 

Total

     788       1,044       32.5  
  

 

 

   

 

 

   

 

 

 

Non-trading securities:

      

Net unrealized gain on non-trading securities

     2,165       —         (100.0

Deferred income taxes

     (539     —         —    
  

 

 

   

 

 

   

 

 

 

Total

     1,626       —         (100.0
  

 

 

   

 

 

   

 

 

 

Own Credit Adjustments:

      

Own Credit Adjustments:

     (7,197     31,350       —    

Deferred income taxes

     1,021       (5,982     —    
  

 

 

   

 

 

   

 

 

 

Total

     (6,176     25,368       —    
  

 

 

   

 

 

   

 

 

 

Total other comprehensive income (loss)

     (20,258     59,750       —    
  

 

 

   

 

 

   

 

 

 

Comprehensive income

     181,189       (38,635     —    

Less: Comprehensive income attributable to noncontrolling interests

     6,067       3,645       (39.9
  

 

 

   

 

 

   

 

 

 

Comprehensive income attributable to NHI shareholders

     175,122       (42,280     —    
  

 

 

   

 

 

   

 

 

 

 

(4)

Note with respect to the Assumption as a Going Concern

Not applicable.

 

– 9 –


Table of Contents
(5)

Segment Information – Operating Segment

The following table shows business segment information and reconciliation items to the consolidated statements of income.

 

     Millions of yen     % Change  
     For the nine months ended     (B-A)/(A)  
     December 31,
2017 (A)
    December 31,
2018 (B)
 

Net revenue

      

Business segment information:

      

Retail

     314,754       265,325       (15.7

Asset Management

     100,018       66,948       (33.1

Wholesale

     503,927       413,148       (18.0
  

 

 

   

 

 

   

 

 

 

Subtotal

     918,699       745,421       (18.9

Other

     193,340       79,117       (59.1
  

 

 

   

 

 

   

 

 

 

Net revenue

     1,112,039       824,538       (25.9
  

 

 

   

 

 

   

 

 

 

Reconciliation items:

      

Unrealized gain (loss) on investments in equity securities held for operating purposes

     6,893       (9,022     —    
  

 

 

   

 

 

   

 

 

 

Net revenue

     1,118,932       815,516       (27.1
  

 

 

   

 

 

   

 

 

 

Non-interest expenses

      

Business segment information:

      

Retail

     233,028       219,136       (6.0

Asset Management

     45,148       47,191       4.5  

Wholesale

     447,545       511,532       14.3  
  

 

 

   

 

 

   

 

 

 

Subtotal

     725,721       777,859       7.2  

Other

     111,976       99,711       (11.0
  

 

 

   

 

 

   

 

 

 

Non-interest expenses

     837,697       877,570       4.8  
  

 

 

   

 

 

   

 

 

 

Reconciliation items:

      

Unrealized gain (loss) on investments in equity securities held for operating purposes

     —         —         —    
  

 

 

   

 

 

   

 

 

 

Non-interest expenses

     837,697       877,570       4.8  
  

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

      

Business segment information:

      

Retail

     81,726       46,189       (43.5

Asset Management

     54,870       19,757       (64.0

Wholesale

     56,382       (98,384     —    
  

 

 

   

 

 

   

 

 

 

Subtotal

     192,978       (32,438     —    

Other*

     81,364       (20,594     —    
  

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

     274,342       (53,032     —    
  

 

 

   

 

 

   

 

 

 

Reconciliation items:

      

Unrealized gain (loss) on investments in equity securities held for operating purposes

     6,893       (9,022     —    
  

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

     281,235        (62,054     —    
  

 

 

   

 

 

   

 

 

 

 

*

Major components

Transactions between operating segments are recorded within segment results on commercial terms and conditions, and are eliminated in “Other.”

The following table presents the major components of income (loss) before income taxes in “Other.”

 

     Millions of yen     % Change  
     For the nine months ended        
     December 31,
2017 (A)
    December 31,
2018 (B)
    (B-A)/(A)  

Net gain (loss) related to economic hedging transactions

     (8,115     (4,754     —    

Realized gain (loss) on investments in equity securities held for operating purposes

     761       158       (79.2

Equity in earnings of affiliates

       23,231         16,599       (28.5

Corporate items

     (1,635     (25,570     —    

Other

     67,122       (7,027     —    
  

 

 

   

 

 

   

 

 

 

Total

     81,364       (20,594     —    
  

 

 

   

 

 

   

 

 

 

 

– 10 –


Table of Contents
(6)

Significant Changes in Equity

Not applicable. For further details of the changes, please refer below.

 

     Millions of yen  
   For the nine months  ended
December 31, 2018
 

Common stock

  

Balance at beginning of year

     594,493  
  

 

 

 

Balance at end of period

     594,493  
  

 

 

 

Additional paid-in capital

  

Balance at beginning of year

     675,280  

Stock-based compensation awards

     8,245  
  

 

 

 

Balance at end of period

     683,525  
  

 

 

 

Retained earnings

  

Balance at beginning of year

     1,696,890  

Cumulative effect of change in accounting principle (1)

     1,564  

Net income (loss) attributable to NHI shareholders

     (101,286

Cash dividends

     (10,173

Gain (loss) on sales of treasury stock

     (994

Cancellation of treasury stock

     (89,916
  

 

 

 

Balance at end of period

     1,496,085  
  

 

 

 

Accumulated other comprehensive income (loss)

  

Cumulative translation adjustments

  

Balance at beginning of year

     (15,596

Net change during the period

     32,594  
  

 

 

 

Balance at end of period

     16,998  
  

 

 

 

Defined benefit pension plans

  

Balance at beginning of year

     (47,837

Pension liability adjustment

     1,044  
  

 

 

 

Balance at end of period

     (46,793
  

 

 

 

Own credit adjustments

  

Balance at beginning of year

     4,077  

Own credit adjustments

     25,368  
  

 

 

 

Balance at end of period

     29,445  
  

 

 

 

Balance at end of period

     (350
  

 

 

 

Common stock held in treasury

  

Balance at beginning of year

     (157,987

Repurchases of common stock

     (51,711

Sale of common stock

     0  

Common stock issued to employees

     8,972  

Cancellation of common stock

     89,916  
  

 

 

 

Balance at end of period

     (110,810
  

 

 

 

Total NHI shareholders’ equity

  
  

 

 

 

Balance at end of period

     2,662,943  
  

 

 

 

Noncontrolling interests

  

Balance at beginning of year

     50,504  

Net change during the period

     (7,436
  

 

 

 

Balance at end of period

     43,068  
  

 

 

 

Total equity

  
  

 

 

 

Balance at end of period

     2,706,011  
  

 

 

 

 

(1)

In relation to Cumulative effect of change in accounting principle, please refer to section “2. Notes to the Summary Information (1) Changes in Accounting Policies.”

 

– 11 –


Table of Contents
(7)

Significant Subsequent Events

 

  a)

Investment in an Affiliated Company

On January 16, 2019, Nomura paid 9.8 billion yen to LINE Securities Preparatory Corporation, whose trade name will change to LINE Securities Corporation (“LINE Securities”) before its operations commence, as a result of undertaking new shares that LINE Securities resolved to issue on January 8, 2019. Following the capital increase, LINE Securities has total capital and capital reserve of 20 billion yen. Nomura owns 49% of LINE Securities. From the fourth quarter of the fiscal year ending March 31, 2019, LINE Securities will be an equity-method affiliate of Nomura.

 

  b)

Tender Offer for Shares in Orion Breweries, Ltd.

On January 23, 2019, Nomura Capital Partners Co., Ltd. (“NCAP”), a wholly owned subsidiary of Nomura Holdings, Inc. , resolved at a board of directors meeting to implement a tender offer for shares of common stock in Orion Breweries, Ltd. (“Orion”) The tender offer will be conducted through Ocean Holdings Co., Ltd., (“Ocean”) which Nomura Capital Partners 1 Investment Limited Partnership, which NCAP represents as a general partner, holds 51% of ownership.

After completion of the tender offer of common stock in Orion, investment in Ocean will be carried at fair value and change in fair value will be recognized through the consolidated statements of income in accordance with Accounting Standard Codification 946 “Financial Services—Investment Companies.”

Overview of the Tender Offer

 

Target Company

   Orion Breweries, Ltd.

 

Type of shares

   Common shares

 

Tender Offer period

   From Thursday, January 24, 2019 to Friday, March 22, 2019 (40 business days)

 

Tender Offer price

   JPY 79,200 per common share

 

Number of shares to be purchased

   Number of shares to be purchased:      658,504 shares  
   Minimum number of shares to be purchased:      418,504 shares  
   Maximum number of shares to be purchased:      —    

Tender Offer agent

   Nomura Securities Co., Ltd.

 

Settlement date

   Friday, March 29, 2019

 

 

– 12 –


Table of Contents
4.

Supplementary Information

 

(1)

Consolidated Statements of Income – Quarterly Comparatives

 

    Millions of yen     % Change     Millions of yen  
    For the three months ended     (B-A)/(A)     For the year  ended
March 31,
2018
 
    June  30,
2017
    September  30,
2017
    December  31,
2017
    March  31,
2018
    June  30,
2018
    September  30,
2018(A)
    December  31,
2018(B)
 

Revenue:

                 

Commissions

    90,968       85,324       101,655       95,366       79,456       74,783       72,715       (2.8     373,313  

Fees from investment banking

    22,707       27,083       29,289       22,584       23,959       19,119       33,129       73.3       101,663  

Asset management and portfolio service fees

    58,343       61,212       63,767       62,294       62,981       62,740       60,591       (3.4     245,616  

Net gain on trading

    120,467       88,391       87,725       146,302       71,887       75,752       96,947       28.0       442,885  

Gain (loss) on private equity investments

    359       (330     (2,381     1,483       553       321       461       43.6       (869

Interest and dividends

    134,392       141,612       161,445       148,226       169,590       188,703       214,542       13.7       585,675  

Gain (loss) on investments in equity securities

    62       3,060       4,532       (4,971     2,092       (1,104     (9,852     —         2,683  

Other

    40,628       56,037       84,597       39,930       20,467       28,067       (11,133     —         221,192  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenue

    467,926       462,389       530,629       511,214       430,985       448,381       457,400       2.0       1,972,158  

Interest expense

    107,103       110,896       124,013       133,177       158,988       165,459       196,803       18.9       475,189  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net revenue

    360,823       351,493       406,616       378,037       271,997       282,922       260,597       (7.9     1,496,969  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-interest expenses:

                 

Compensation and benefits

    136,249       122,035       131,372       140,985       127,700       125,800       118,928       (5.5     530,641  

Commissions and floor brokerage

    23,775       25,242       25,252       25,599       20,935       19,579       23,821       21.7       99,868  

Information processing and communications

    44,569       47,263       49,049       43,900       40,961       40,515       41,756       3.1       184,781  

Occupancy and related depreciation

    17,056       17,209       16,805       16,825       16,376       16,464       15,852       (3.7     67,895  

Business development expenses

    8,409       7,823       9,801       10,729       8,896       9,337       9,121       (2.3     36,762  

Other

    53,322       48,882       53,584       93,076       43,486       70,760       127,283       79.9       248,864  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total non-interest expenses

    283,380       268,454       285,863       331,114       258,354       282,455       336,761       19.2       1,168,811  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

    77,443       83,039       120,753       46,923       13,643       467       (76,164     —         328,158  

Income tax expense

    19,405       29,423       30,960       24,078       6,930       9,703       19,698       103.0       103,866  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

    58,038       53,616       89,793       22,845       6,713       (9,236     (95,862     —         224,292  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Less: Net income (loss) attributable to noncontrolling interests

    1,182       1,766       1,831       170       1,490       1,997       (586     —         4,949  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) attributable to NHI shareholders

    56,856       51,850       87,962       22,675       5,223       (11,233     (95,276     —         219,343  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
    Yen     % Change     Yen  

Per share of common stock:

                 

Basic-

                 

Net income (loss) attributable to NHI shareholders per share

    16.07       14.70       25.55       6.68       1.54       (3.31     (28.52     —         63.13  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Diluted-

                 

Net income (loss) attributable to NHI shareholders per share

    15.77       14.45       25.12       6.56       1.50       (3.32     (28.52     —         61.88  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

– 13 –


Table of Contents
(2)

Business Segment Information – Quarterly Comparatives

The following table shows quarterly business segment information and reconciliation items to the consolidated statements of income.

 

    Millions of yen     % Change     Millions of yen  
    For the three months ended     (B-A)/(A)     For the year  ended
March 31,
2018
 
    June  30,
2017
    September  30,
2017
    December  31,
2017
    March  31,
2018
    June  30,
2018
    September  30,
2018(A)
    December  31,
2018(B)
 

Net revenue

                 

Business segment information:

                 

Retail

    101,684        101,786       111,284        98,154       92,833       85,710       86,782       1.3       412,908   

Asset Management

    28,097       35,418       36,503       27,319       26,089       24,681       16,178       (34.5     127,337  

Wholesale

    179,316       158,963       165,648       211,406       137,290       147,660       128,198       (13.2     715,333  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Subtotal

    309,097       296,167       313,435       336,879       256,212       258,051       231,158       (10.4     1,255,578  

Other

    51,707       52,610       89,023       46,153       13,738       25,982       39,397       51.6       239,493  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net revenue

    360,804       348,777       402,458       383,032       269,950       284,033       270,555       (4.7     1,495,071  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation items:

                 

Unrealized gain (loss) on investments in equity securities held for operating purposes

    19       2,716       4,158       (4,995     2,047       (1,111     (9,958     —         1,898  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net revenue

    360,823       351,493       406,616       378,037       271,997       282,922       260,597       (7.9     1,496,969  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-interest expenses

                 

Business segment information:

                 

Retail

    76,792       76,239       79,997       76,743       72,909       73,494       72,733       (1.0     309,771  

Asset Management

    14,527       14,950       15,671       16,019       15,806       15,768       15,617       (1.0     61,167  

Wholesale

    153,963       141,980       151,602       167,200       144,714       142,745       224,073       57.0       614,745  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Subtotal

    245,282       233,169       247,270       259,962       233,429       232,007       312,423       34.7       985,683  

Other

    38,098       35,285       38,593       71,152       24,925       50,448       24,338       (51.8     183,128  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-interest expenses

    283,380       268,454       285,863       331,114       258,354       282,455       336,761       19.2       1,168,811  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation items:

                 

Unrealized gain (loss) on investments in equity securities held for operating purposes

    —         —         —         —         —         —         —         —         —    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-interest expenses

    283,380       268,454       285,863       331,114       258,354       282,455       336,761       19.2       1,168,811  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

                 

Business segment information:

                 

Retail

    24,892       25,547       31,287       21,411       19,924       12,216       14,049       15.0       103,137  

Asset Management

    13,570       20,468       20,832       11,300       10,283       8,913       561       (93.7     66,170  

Wholesale

    25,353       16,983       14,046       44,206       (7,424     4,915       (95,875     —         100,588  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Subtotal

    63,815       62,998       66,165       76,917       22,783       26,044       (81,265     —         269,895  

Other*

    13,609       17,325       50,430       (24,999     (11,187     (24,466     15,059       —         56,365  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

    77,424       80,323       116,595       51,918       11,596       1,578       (66,206     —         326,260  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Reconciliation items:

                 

Unrealized gain (loss) on investments in equity securities held for operating purposes

    19       2,716       4,158       (4,995     2,047       (1,111     (9,958     —         1,898  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes

    77,443       83,039       120,753       46,923       13,643       467       (76,164     —         328,158  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

*

Major components

Transactions between operating segments are recorded within segment results on commercial terms and conditions, and are eliminated in “Other.”

The following table presents the major components of income (loss) before income taxes in “Other.”

 

    Millions of yen     % Change     Millions of yen  
    For the three months ended     (B-A)/(A)     For the year  ended
March 31,
2018
 
    June  30,
2017
    September  30,
2017
    December  31,
2017
    March  31,
2018
    June  30,
2018
    September  30,
2018(A)
    December  31,
2018(B)
 

Net gain (loss) related to economic hedging transactions

    (654     558       (8,019     1,654       (13,807     (16,018     25,071       —         (6,461

Realized gain (loss) on investments in equity securities held for operating purposes

    43       344       374       24       45       7       106       —         785  

Equity in earnings of affiliates

    7,022       8,408       7,801       11,017       6,619       8,536       1,444       (83.1     34,248  

Corporate items

    154       1,597       (3,386     (40,249     (2,482     (23,719     631       —         (41,884

Other

    7,044       6,418       53,660       2,555       (1,562     6,728       (12,193     —         69,677  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

    13,609       17,325       50,430       (24,999     (11,187     (24,466     15,059       —         56,365  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

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Table of Contents
(3)

Other

Quarterly financial information for Nomura Securities Co., Ltd. can be found at the following URL.

https://www.nomuraholdings.com/company/group/nsc/pdf/2019_3q.pdf

 

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