• Group Net Revenue: Increased 21% year-on-year to JPY1,892.5 billion.
• Income Before Income Taxes: Grew 72% to JPY472 billion.
• Net Income: Doubled to a record high of JPY340.7 billion.
• Earnings Per Share (EPS): JPY11.03.
• Return on Equity (ROE): 10%.
• Dividend: Total year-end dividend of JPY34 per share, annual dividend of JPY57 per share, payout ratio of 49%.
• Share Buyback Program: Upper limit of 100 million shares, aggregate repurchase price limit of JPY60 billion.
• Fourth Quarter Group Net Revenue: Fell 10% to JPY452.7 billion.
• Fourth Quarter Income Before Income Taxes: Fell 29% to JPY97.7 billion.
• Fourth Quarter Net Income: Down 29% to JPY72 billion.
• Fourth Quarter Earnings Per Share (EPS): JPY23.39.
• Wealth Management Net Revenue: Fell 10% to JPY104.5 billion in Q4.
• Investment Management Net Revenue: Down 6% to JPY43 billion in Q4.
• Wholesale Net Revenue: Fell 11% to JPY259.2 billion in Q4.
• Assets Under Management: JPY89.3 trillion at the end of March.
• Tier One Capital Ratio: 16.2% at the end of March.
• Common Equity Tier 1 Ratio: 14.5% at the end of March.

• Warning! GuruFocus has detected 3 Warning Sign with NMR.

Release Date: April 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Nomura Holdings Inc (NYSE:NMR) reported a 21% year-on-year increase in group net revenue, reaching JPY1,892.5 billion.
• Income before income taxes grew by 72% to JPY472 billion, with net income doubling to a record high of JPY340.7 billion.
• The company achieved an 11-year high in wealth management income before income taxes and a 15-year high in wholesale.
• Nomura Holdings Inc (NYSE:NMR) announced a share buyback program with an upper limit of 100 million shares, valued at JPY60 billion.
• The company exceeded its KPI targets in wealth management, with net inflows of recurring revenue assets sharply surpassing the target.

Negative Points

• Group net revenue fell 10% quarter-on-quarter to JPY452.7 billion, with income before income taxes dropping 29% to JPY97.7 billion.
• Fixed income revenues in the wholesale segment slowed, with a 24% decline in net revenue to JPY105.8 billion.
• The company's cost to income ratio in the wholesale segment was high at 84%, indicating room for improvement in cost management.
• Investment management saw a decline in net revenue by 6% to JPY43 billion, with income before income taxes falling 18% to JPY15.5 billion.
• Market conditions were challenging, with rising yen rates and a decline in the stock market impacting performance.

Q & A Highlights

Q: Global markets, particularly fixed income, seem weak compared to US peers. Can you elaborate on the business performance and the latest situation in April? A: Takumi Kitamura, CFO: Fixed income appears weak due to differences in product mix and regional focus. We don't engage in commodities, which some competitors do. In Japan, rising JCB rates created a challenging environment. Monthly performance showed a drop in March, with April's average below Q4 levels. We are cautious about liquidity and market conditions.

Q: Regarding capital policy, is the CET 1 target around 13%? How does this relate to the share buyback program? A: Takumi Kitamura, CFO: The CET 1 target isn't strictly set at 13%. We consider various indicators, including tier 1 and capital adequacy ratios, when deciding on the JPY60 billion share buyback. The target range will be announced at the upcoming Investor Day.

Q: Are there plans to change resource allocation between regions, especially given the capital shift from the US to Europe? A: Takumi Kitamura, CFO: While ECB rate reductions have been favorable for Europe, the changes aren't significant enough to alter our resource allocation yet. If trends continue, we may need to reconsider.

Q: What is the rationale behind the JPY60 billion share buyback, and how does it relate to the RSCU portion? A: Takumi Kitamura, CFO: The JPY60 billion buyback was determined by evaluating various financial ratios. The RSCU portion is included, ensuring we meet our committed total return ratio of over 50%.

Q: How do you evaluate the cost-to-income ratio in the wholesale division, and what is the future outlook? A: Takumi Kitamura, CFO: The cost-to-income ratio was high due to increased equities execution costs. We see room for improvement and are implementing initiatives to lower the ratio, though it will take time to reflect in financial statements.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.