Edgar Filing: NOMURA HOLDINGS INC

FORM 6-K

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 April 2018

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):

Information furnished on this form:

EXHIBIT


Exhibit Number

1.		Financial Summary – Year ended March 31, 2018

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: April 26, 2018	By:	/s/ Hajime Ikeda
		Hajime Ikeda
		Senior Managing Director

Financial Summary For the Year Ended March 31, 2018 (U.S. GAAP)


Date:		April 26, 2018
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: http://www.nomura.com

1. Consolidated Operating Results

(1) Operating Results


	(Rounded to nearest million)

	For the year ended March 31
	2017						2018
	(Millions of yen, except per share data)
				% Change from March 31, 2016						% Change from March 31, 2017
Total revenue		1,715,516			(0.4	%)		1,972,158			15.0	%
Net revenue		1,403,197			0.5	%		1,496,969			6.7	%
Income before income taxes		322,795			95.4	%		328,158			1.7	%
Net income attributable to Nomura Holdings, Inc. (“NHI”) shareholders		239,617			82.1	%		219,343			(8.5	%)
Comprehensive income		209,847			398.0	%		125,686			(40.1	%)
Basic-Net income attributable to NHI shareholders per share (Yen)		67.29						63.13
Diluted-Net income attributable to NHI shareholders per share (Yen)		65.65						61.88
Return on shareholders’ equity		8.7	%					7.9	%
Income before income taxes to total assets		0.8	%					0.8	%
Income before income taxes divided by total revenue		18.8	%					16.6	%
Equity in earnings of affiliates		33,000						34,516

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

(2) Financial Position



	At March 31
	2017			2018
	(Millions of yen, except per share data)
Total assets		42,852,078			40,591,329
Total equity		2,843,791			2,799,824
Total NHI shareholders’ equity		2,789,916			2,749,320
Total NHI shareholders’ equity as a percentage of total assets		6.5	%		6.8	%
Total NHI shareholders’ equity per share (Yen)		790.70			810.31

(3) Cash Flows



	For the year ended March 31
	2017			2018
	(Millions of yen)
Net cash provided by (used in) operating activities		1,305,025			(445,696	)
Net cash provided by (used in) investing activities		(118,051	)		(56,172	)
Net cash provided by (used in) financing activities		(2,130,644	)		373,168
Cash and cash equivalents at end of the year		2,536,840			2,354,639

2. Cash Dividends

	For the year ended March 31
	2017			2018
	(Yen amounts, except total annual dividends)
Dividends per share
Dividends record dates
At June 30		—			—
At September 30		9.00			9.00
At December 31		—			—
At March 31		11.00			11.00
For the year		20.00			20.00
Total annual dividends (Millions of yen)		70,825			68,704
Consolidated payout ratio		29.7	%		31.7	%
Consolidated dividends as a percentage of shareholders’ equity per share		2.6	%		2.5	%

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 and dividends forecasts.

Notes

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

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

(2) Changes in accounting policies

a) Changes in accounting policies due to amendments to the accounting standards : None

b) Changes in accounting policies due to other than a) : None

(3) Number of shares issued (common stock)


	At March 31
	2017		2018
Number of shares outstanding (including treasury stock)		3,822,562,601		3,643,562,601
Number of treasury stock		294,133,150		250,625,115

	For the year ended March 31
	2017		2018
Average number of shares outstanding		3,560,775,652		3,474,593,441

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

Table of Contents for the Accompanying Materials


1. Overview of Consolidated Operating Results			P. 2

(1) Overview of Consolidated Operating Results			P. 2
(2) Overview of Consolidated Financial Position			P. 4
(3) Overview of Cash Flows			P. 4

2. Considerations in the selection of accounting standards			P. 5

3. 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) Consolidated Statements of Changes in Equity			P.10
(5) Consolidated Statements of Cash Flows			P.11
(6) Note with respect to the Assumption as a Going Concern			P.11
(7) Notes to the Consolidated Financial Statements			P.12
(8) Other Financial Information			P.14

4. Other Information			P.16

– 1 –

1.	Overview of Consolidated Operating Results

(1)

Overview of Consolidated Operating Results

Operating Results

U.S. GAAP


	Billions of yen						% Change
	For the year ended						(B-A)/(A)
	March 31, 2017 (A)			March 31, 2018 (B)			(B-A)/(A)
Net revenue		1,403.2			1,497.0			6.7
Non-interest expenses		1,080.4			1,168.8			8.2

Income (loss) before income taxes		322.8			328.2			1.7
Income tax expense		80.2			103.9			29.5

Net income (loss)		242.6			224.3			(7.5	)

Less: Net income (loss) attributable to noncontrolling interests		2.9			4.9			67.8

Net income (loss) attributable to NHI shareholders		239.6			219.3			(8.5	)

Return on shareholders’ equity *		8.7	%		7.9	%		—

* 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 (“Nomura”) reported net revenue of 1,497.0 billion yen for the fiscal year ended March 31, 2018, an increase of 6.7% from the previous year. Non-interest expenses increased by 8.2% from the previous year to 1,168.8 billion yen. Income before income taxes was 328.2 billion yen and Net income attributable to NHI shareholders was 219.3 billion yen for the fiscal year ended March 31, 2018.

Segment Information


	Billions of yen				% Change
	For the year ended				(B-A)/(A)
	March 31, 2017 (A)		March 31, 2018 (B)		(B-A)/(A)
Net revenue		1,396.6		1,495.1		7.1
Non-interest expenses		1,080.4		1,168.8		8.2

Income (loss) before income taxes		316.2		326.3		3.2

In business segment totals, which exclude unrealized gain (loss) on investments in equity securities held for operating purposes, net revenue for the fiscal year ended March 31, 2018 was 1,495.1 billion yen, an increase of 7.1% from the previous year. Non-interest expenses increased by 8.2% from the previous year to 1,168.8 billion yen. Income before income taxes was 326.3 billion yen for the fiscal year ended March 31, 2018. Please refer to page 13 for further details of the differences between U.S. GAAP and business segment amounts.

– 2 –

<Business Segment Results>

Operating Results of Retail


	Billions of yen				% Change
	For the year ended				(B-A)/(A)
	March 31, 2017 (A)		March 31, 2018 (B)		(B-A)/(A)
Net revenue		374.4		412.9		10.3
Non-interest expenses		299.6		309.8		3.4

Income (loss) before income taxes		74.8		103.1		37.9

Net revenue increased by 10.3% from the previous year to 412.9 billion yen, primarily due to increasing commissions from distribution of investment trusts and brokerage. Non-interest expense increased by 3.4% to 309.8 billion yen. As a result, income before income taxes increased by 37.9% to 103.1 billion yen.

Operating Results of Asset Management


	Billions of yen				% Change
	For the year ended				(B-A)/(A)
	March 31, 2017 (A)		March 31, 2018 (B)		(B-A)/(A)
Net revenue		99.4		127.3		28.1
Non-interest expenses		57.1		61.2		7.1

Income (loss) before income taxes		42.3		66.2		56.3

Net revenue increased by 28.1% from the previous year to 127.3 billion yen. Non-interest expense increased by 7.1% to 61.2 billion yen. As a result, income before income taxes increased by 56.3% to 66.2 billion yen. Assets under management were 50.0 trillion yen as of March 31, 2018.

Operating Results of Wholesale


	Billions of yen				% Change
	For the year ended				(B-A)/(A)
	March 31, 2017 (A)		March 31, 2018 (B)		(B-A)/(A)
Net revenue		739.3		715.3		(3.2	)
Non-interest expenses		577.8		614.7		6.4

Income (loss) before income taxes		161.4		100.6		(37.7	)

Net revenue decreased by 3.2% from the previous year to 715.3 billion yen. Non-interest expense increased by 6.4% to 614.7 billion yen. As a result, income before income taxes decreased by 37.7% to 100.6 billion yen.

Other Operating Results


	Billions of yen				% Change
	For the year ended				(B-A)/(A)
	March 31, 2017 (A)		March 31, 2018 (B)		(B-A)/(A)
Net revenue		183.5		239.5		30.5
Non-interest expenses		145.9		183.1		25.6

Income (loss) before income taxes		37.6		56.4		49.9

Net revenue was 239.5 billion yen and income before income taxes was 56.4 billion yen.

– 3 –

(2)

Overview of Consolidated Financial Position

Total assets as of March 31, 2018, were 40,591.3 billion yen, a decrease of 2,260.7 billion yen compared to March 31, 2017, mainly due to the decrease in Securities purchased under agreements to resell. Total liabilities as of March 31, 2018 were 37,791.5 billion yen, a decrease of 2,216.8 billion yen compared to March 31, 2017, mainly due to the decrease in Securities sold under agreements to repurchase. Total equity as of March 31, 2018 was 2,799.8 billion yen, a decrease of 44.0 billion yen compared to March 31, 2017. During the year ended March 31, 2018, Nomura cancelled 179,000,000 shares of its own shares.

(3)

Overview of Cash Flows

Cash and cash equivalents as of March 31, 2018, decreased by 182.2 billion yen compared to March 31, 2017. Cash flows from operating activities for the year ended March 31, 2018 were outflows of 445.7 billion yen due mainly to the increase in Loans and receivables, net of allowance for doubtful accounts. Cash flows from investing activities for the year ended March 31, 2018 were outflows of 56.2 billion yen due mainly to Payments for purchases of office buildings, land, equipment and facilities. Cash flows from financing activities for the year ended March 31, 2018 were inflows of 373.2 billion yen due primarily to the increase in long-term borrowings.

– 4 –

2.	Considerations in the selection of accounting standards

Nomura currently adopts U.S. generally accepted accounting principles. Depending on factors such as trends by other companies and the impact of International Financial Reporting Standards (“IFRS”) on Nomura’s businesses, Nomura may consider in adopting IFRS in the future.

3.	Consolidated Financial Statements

The 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 26, 2017) and Form 20-F (the annual report filed with the U.S. Securities and Exchange Commission on June 26, 2017) for the year ended March 31, 2017.

– 5 –

(1)

Consolidated Balance Sheets


	Millions of yen
	March 31, 2017			March 31, 2018			Increase/ (Decrease)
ASSETS
Cash and cash deposits:
Cash and cash equivalents		2,536,840			2,354,639			(182,201	)
Time deposits		207,792			315,445			107,653
Deposits with stock exchanges and other segregated cash		227,456			288,962			61,506

Total cash and cash deposits		2,972,088			2,959,046			(13,042	)

Loans and receivables:
Loans receivable		1,875,828			2,462,503			586,675
Receivables from customers		308,086			442,343			134,257
Receivables from other than customers		1,005,766			1,216,382			210,616
Allowance for doubtful accounts		(3,551	)		(3,514	)		37

Total loans and receivables		3,186,129			4,117,714			931,585

Collateralized agreements:
Securities purchased under agreements to resell		11,456,591			9,853,898			(1,602,693	)
Securities borrowed		7,273,234			6,383,845			(889,389	)

Total collateralized agreements		18,729,825			16,237,743			(2,492,082	)

Trading assets and private equity investments:
Trading assets*		15,165,310			14,967,557			(197,753	)
Private equity investments		27,054			17,466			(9,588	)

Total trading assets and private equity investments		15,192,364			14,985,023			(207,341	)

Other assets:
Office buildings, land, equipment and facilities (net of accumulated depreciation and amortization of ¥445,000 million as of March 31, 2017 and ¥397,834 million as of March 31, 2018)		349,696			338,984			(10,712	)
Non-trading debt securities*		775,025			485,891			(289,134	)
Investments in equity securities*		146,730			150,760			4,030
Investments in and advances to affiliated companies*		420,116			408,034			(12,082	)
Other		1,080,105			908,134			(171,971	)

Total other assets		2,771,672			2,291,803			(479,869	)

Total assets		42,852,078			40,591,329			(2,260,749	)

*	Including securities pledged as collateral

– 6 –


			Millions of yen
			March 31, 2017			March 31, 2018			Increase/ (Decrease)
LIABILITIES AND EQUITY
Short-term borrowings				543,049			743,497			200,448
Payables and deposits:
Payables to customers				1,065,920			1,176,773			110,853
Payables to other than customers				1,509,672			1,476,540			(33,132	)
Deposits received at banks				1,132,843			1,151,342			18,499

Total payables and deposits				3,708,435			3,804,655			96,220

Collateralized financing:
Securities sold under agreements to repurchase				17,095,898			14,759,010			(2,336,888	)
Securities loaned				1,627,124			1,524,363			(102,761	)
Other secured borrowings				338,069			413,621			75,552

Total collateralized financing				19,061,091			16,696,994			(2,364,097	)

Trading liabilities				8,191,794			8,213,318			21,524
Other liabilities				1,308,510			950,534			(357,976	)
Long-term borrowings				7,195,408			7,382,507			187,099

Total liabilities				40,008,287			37,791,505			(2,216,782	)

Equity
NHI shareholders’ equity:
Common stock
Authorized	-	6,000,000,000 shares
Issued	-	3,822,562,601 shares as of March 31, 2017 and
		3,643,562,601 shares as of March 31, 2018
Outstanding	-	3,528,429,451 shares as of March 31, 2017 and
		3,392,937,486 shares as of March 31, 2018		594,493			594,493			—
Additional paid-in capital				681,329			675,280			(6,049	)
Retained earnings				1,663,234			1,696,890			33,656
Accumulated other comprehensive income (loss)				33,652			(59,356	)		(93,008	)

Total NHI shareholders’ equity before treasury stock				2,972,708			2,907,307			(65,401	)
Common stock held in treasury, at cost -
294,133,150 shares as of March 31, 2017 and
250,625,115 shares as of March 31, 2018				(182,792	)		(157,987	)		24,805

Total NHI shareholders’ equity				2,789,916			2,749,320			(40,596	)

Noncontrolling interests				53,875			50,504			(3,371	)

Total equity				2,843,791			2,799,824			(43,967	)

Total liabilities and equity				42,852,078			40,591,329			(2,260,749	)

– 7 –

(2) Consolidated Statements of Income


	Millions of yen					% Change
	For the year ended					(B-A)/(A)
	March 31, 2017(A)		March 31, 2018(B)			(B-A)/(A)
Revenue:
Commissions		327,129		373,313			14.1
Fees from investment banking		92,580		101,663			9.8
Asset management and portfolio service fees		216,479		245,616			13.5
Net gain on trading		475,587		442,885			(6.9	)
Gain (loss) on private equity investments		1,371		(869	)		—
Interest and dividends		441,036		585,675			32.8
Gain on investments in equity securities		7,708		2,683			(65.2	)
Other		153,626		221,192			44.0

Total revenue		1,715,516		1,972,158			15.0
Interest expense		312,319		475,189			52.1

Net revenue		1,403,197		1,496,969			6.7

Non-interest expenses:
Compensation and benefits		496,385		530,641			6.9
Commissions and floor brokerage		94,495		99,868			5.7
Information processing and communications		175,280		184,781			5.4
Occupancy and related depreciation		69,836		67,895			(2.8	)
Business development expenses		35,111		36,762			4.7
Other		209,295		248,864			18.9

Total non-interest expenses		1,080,402		1,168,811			8.2

Income before income taxes		322,795		328,158			1.7
Income tax expense		80,229		103,866			29.5

Net income		242,566		224,292			(7.5	)

Less: Net income attributable to noncontrolling interests		2,949		4,949			67.8

Net income attributable to NHI shareholders		239,617		219,343			(8.5	)

Per share of common stock:

	Yen					% Change
Basic-
Net income attributable to NHI shareholders per share		67.29		63.13			(6.2	)

Diluted-
Net income attributable to NHI shareholders per share		65.65		61.88			(5.7	)

– 8 –

(3) Consolidated Statements of Comprehensive Income


	Millions of yen						% Change
	For the year ended						(B-A)/(A)
	March 31, 2017(A)			March 31, 2018(B)			(B-A)/(A)
Net income		242,566			224,292			(7.5	)
Other comprehensive income (loss):
Change in cumulative translation adjustments:
Change in cumulative translation adjustments		(6,764	)		(77,067	)		—
Deferred income taxes		1,073			14,263			—

Total		(5,691	)		(62,804	)		—

Defined benefit pension plans:
Pension liability adjustments		(11,340	)		(10,124	)		—
Deferred income taxes		3,645			3,307			(9.3	)

Total		(7,695	)		(6,817	)		—

Non-trading securities:
Net unrealized gain (loss) on non-trading securities		(9,225	)		(38,717	)		—
Deferred income taxes		2,625			12,216			365.4

Total		(6,600	)		(26,501	)		—

Own credit adjustments:
Own credit adjustments		(14,696	)		(2,867	)		—
Deferred income taxes		1,963			383			(80.5	)

Total		(12,733	)		(2,484	)		—

Total other comprehensive income (loss)		(32,719	)		(98,606	)		—

Comprehensive income		209,847			125,686			(40.1	)
Less: Comprehensive income (loss) attributable to noncontrolling interests		852			(649	)		—

Comprehensive income attributable to NHI shareholders		208,995			126,335			(39.6	)

– 9 –

(4) Consolidated Statements of Changes in Equity


	Millions of yen
	For the year ended
	March 31, 2017			March 31, 2018
Common stock
Balance at beginning of year		594,493			594,493

Balance at end of year		594,493			594,493

Additional paid-in capital
Balance at beginning of year		692,706			681,329
Issuance and exercise of common stock options		(11,377	)		(5,465	)
Changes in ownership interests in subsidiaries		—			(584	)

Balance at end of year		681,329			675,280

Retained earnings
Balance at beginning of year		1,516,577			1,663,234
Cumulative effect of change in accounting principle (1)		(19,294	)		—
Net income attributable to NHI shareholders		239,617			219,343
Cash dividends		(70,810	)		(68,703	)
Gain (loss) on sales of treasury stock		(2,856	)		(5,043	)
Cancellation of treasury stock		—			(111,941	)

Balance at end of year		1,663,234			1,696,890

Accumulated other comprehensive income (loss)
Cumulative translation adjustments
Balance at beginning of year		53,418			47,767
Net change during the year		(5,651	)		(63,363	)

Balance at end of year		47,767			(15,596	)

Defined benefit pension plans
Balance at beginning of year		(33,325	)		(41,020	)
Pension liability adjustments		(7,695	)		(6,817	)

Balance at end of year		(41,020	)		(47,837	)

Non-trading securities
Balance at beginning of year		24,887			20,344
Net unrealized gain (loss) on non-trading securities		(4,543	)		(20,344	)

Balance at end of year		20,344			—

Own credit adjustments
Balance at beginning of year		—			6,561
Cumulative effect of change in accounting principle (1)		19,294			—
Own credit adjustments		(12,733	)		(2,484	)

Balance at end of year		6,561			4,077

Balance at end of year		33,652			(59,356	)

Common stock held in treasury
Balance at beginning of year		(148,517	)		(182,792	)
Repurchases of common stock		(61,338	)		(109,096	)
Sales of common stock		1			0
Common stock issued to employees		25,796			21,398
Cancellation of common stock		—			111,941
Other net change in treasury stock		1,266			562

Balance at end of year		(182,792	)		(157,987	)

Total NHI shareholders’ equity

Balance at end of year		2,789,916			2,749,320

Noncontrolling interests
Balance at beginning of year		42,776			53,875
Cumulative effect of change in accounting principle (2)		11,330			—
Net change during the year		(231	)		(3,371	)

Balance at end of year		53,875			50,504

Total equity

Balance at end of year		2,843,791			2,799,824

(1) Represents the adjustment to initially apply Accounting Standards Update (“ASU”) 2016-01, “Recognition and Measurement of Financial Assets and Financial Liabilities.”

(2) Represents the adjustment to initially apply ASU 2015-02, “Amendments to the Consolidation analysis.”

– 10 –

(5) Consolidated Statements of Cash Flows


	Millions of yen
	For the year ended
	March 31, 2017			March 31, 2018
Cash flows from operating activities:
Net income		242,566			224,292
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization		70,928			71,579
Gain on investments in equity securities		(7,708	)		(2,683	)
Changes in operating assets and liabilities:
Time deposits		(18,275	)		(100,642	)
Deposits with stock exchanges and other segregated cash		(2,854	)		(72,075	)
Trading assets and private equity investments		1,197,062			(240,215	)
Trading liabilities		708,196			231,077
Securities purchased under agreements to resell, net of securities sold under agreements to repurchase		635,593			(453,239	)
Securities borrowed, net of securities loaned		(1,706,545	)		763,297
Other secured borrowings		(138,204	)		79,121
Loans and receivables, net of allowance for doubtful accounts		(193,786	)		(932,971	)
Payables		531,516			132,960
Bonus accrual		4,543			(2,957	)
Other, net		(18,007	)		(143,240	)

Net cash provided by (used in) operating activities		1,305,025			(445,696	)


Cash flows from investing activities:
Payments for purchases of office buildings, land, equipment and facilities		(312,880	)		(285,161	)
Proceeds from sales of office buildings, land, equipment and facilities		239,184			224,220
Payments for purchases of investments in equity securities		(647	)		(61	)
Proceeds from sales of investments in equity securities		1,998			932
Increase in loans receivable at banks, net		(21,322	)		(105,387	)
Decrease in non-trading debt securities, net		88,099			80,634
Other, net		(112,483	)		28,651

Net cash used in investing activities		(118,051	)		(56,172	)


Cash flows from financing activities:
Increase in long-term borrowings		1,526,334			2,314,609
Decrease in long-term borrowings		(2,403,076	)		(1,964,657	)
Increase (decrease) in short-term borrowings, net		(81,964	)		215,001
Decrease in deposits received at banks, net		(1,068,168	)		(13,254	)
Proceeds from sales of common stock held in treasury		401			764
Payments for repurchases of common stock in treasury		(61,338	)		(109,096	)
Payments for cash dividends		(42,833	)		(70,199	)

Net cash provided by (used in) financing activities		(2,130,644	)		373,168

Effect of exchange rate changes on cash and cash equivalents		4,249			(53,501	)

Net decrease in cash and cash equivalents		(939,421	)		(182,201	)
Cash and cash equivalents at beginning of the year		3,476,261			2,536,840

Cash and cash equivalents at end of the year		2,536,840			2,354,639

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

Not applicable.

– 11 –

(7) Notes to the Consolidated Financial Statements

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 year ended
	March 31, 2017 (A)		March 31, 2018 (B)		(B-A)/(A)
Net revenue

Business segment information:
Retail		374,434		412,908		10.3
Asset Management		99,427		127,337		28.1
Wholesale		739,256		715,333		(3.2	)

Subtotal		1,213,117		1,255,578		3.5
Other		183,464		239,493		30.5

Net revenue		1,396,581		1,495,071		7.1

Reconciliation items:
Unrealized gain (loss) on investments in equity securities held for operating purposes		6,616		1,898		(71.3	)

Net revenue		1,403,197		1,496,969		6.7


Non-interest expenses

Business segment information:
Retail		299,642		309,771		3.4
Asset Management		57,094		61,167		7.1
Wholesale		577,809		614,745		6.4

Subtotal		934,545		985,683		5.5
Other		145,857		183,128		25.6

Non-interest expenses		1,080,402		1,168,811		8.2

Reconciliation items:
Unrealized gain (loss) on investments in equity securities held for operating purposes		—		—		—

Non-interest expenses		1,080,402		1,168,811		8.2


Income (loss) before income taxes

Business segment information:
Retail		74,792		103,137		37.9
Asset Management		42,333		66,170		56.3
Wholesale		161,447		100,588		(37.7	)

Subtotal		278,572		269,895		(3.1	)
Other*		37,607		56,365		49.9

Income (loss) before income taxes		316,179		326,260		3.2

Reconciliation items:
Unrealized gain (loss) on investments in equity securities held for operating purposes		6,616		1,898		(71.3	)

Income (loss) before income taxes		322,795		328,158		1.7

* 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 year ended
	March 31, 2017 (A)			March 31, 2018 (B)			(B-A)/(A)
Net gain (loss) related to economic hedging transactions		(7,279	)		(6,461	)		—
Realized gain (loss) on investments in equity securities held for operating purposes		1,092			785			(28.1	)
Equity in earnings of affiliates		32,342			34,248			5.9
Corporate items		(6,439	)		(41,884	)		—
Other		17,891			69,677			289.5

Total		37,607			56,365			49.9

– 12 –

Per share data

Shareholders’ equity per share is calculated based on the following number of shares.


Number of shares outstanding as of March 31, 2018			3,392,937,486

Net income attributable to NHI shareholders per share calculated based on the following number of shares.


Average number of shares outstanding for the year ended March 31, 2018			3,474,593,441

Changes in Tax Laws

On December 22, 2017, the Tax Cuts and Jobs Act (“the Act”) was enacted in the United States which significantly changes US income tax law, including reducing the US federal corporate income tax rate to 21%, broadening the US tax base, introducing a territorial tax system and one time repatriation tax on US entities for previously deferred earnings of non-US investees, allowing full expensing of certain property assets and imposing certain additional taxes on payments made from US entities to foreign related parties.

Nomura has recognized a reduction of 2.8 billion yen in deferred tax liabilities and deferred tax expense as a result of the reduction in the corporate income tax rate which is effective for US entities from January 1, 2018.

Nomura continues to evaluate and assess the other impacts of the Act on our US entities and may recognize further adjustments to deferred tax assets and liabilities, and therefore to income tax expense (benefit), during the fiscal year ending March 31, 2019 depending on, among other things, finalizing of calculations for all impacted entities, changes in certain assumptions and interpretations made by Nomura, certain actions to be taken by Nomura in the future and whether additional guidance is released by the US tax authorities and other bodies.

Significant Subsequent Events

Not applicable.

– 13 –

(8) Other Financial Information

Consolidated Statements of Income – Quarterly Comparatives


	Millions of yen																						% Change
	For the three months ended																						(B-A)/(A)
	June 30, 2016			September 30, 2016			December 31, 2016		March 31, 2017			June 30, 2017		September 30, 2017			December 31, 2017(A)			March 31, 2018(B)			(B-A)/(A)
Revenue:
Commissions		76,255			74,640			86,257		89,977			90,968		85,324			101,655			95,366			(6.2	)
Fees from investment banking		17,313			23,353			23,743		28,171			22,707		27,083			29,289			22,584			(22.9	)
Asset management and portfolio service fees		52,612			52,140			55,106		56,621			58,343		61,212			63,767			62,294			(2.3	)
Net gain on trading		140,143			118,758			108,385		108,301			120,467		88,391			87,725			146,302			66.8
Gain (loss) on private equity investments		(13	)		(420	)		596		1,208			359		(330	)		(2,381	)		1,483			—
Interest and dividends		106,551			108,863			117,383		108,239			134,392		141,612			161,445			148,226			(8.2	)
Gain (loss) on investments in equity securities		(9,966	)		7,654			12,865		(2,845	)		62		3,060			4,532			(4,971	)		—
Other		35,517			41,121			39,549		37,439			40,628		56,037			84,597			39,930			(52.8	)

Total revenue		418,412			426,109			443,884		427,111			467,926		462,389			530,629			511,214			(3.7	)
Interest expense		79,932			79,114			75,239		78,034			107,103		110,896			124,013			133,177			7.4

Net revenue		338,480			346,995			368,645		349,077			360,823		351,493			406,616			378,037			(7.0	)

Non-interest expenses:
Compensation and benefits		125,949			127,969			127,592		114,875			136,249		122,035			131,372			140,985			7.3
Commissions and floor brokerage		24,172			22,867			22,977		24,479			23,775		25,242			25,252			25,599			1.4
Information processing and communications		44,249			41,601			42,152		47,278			44,569		47,263			49,049			43,900			(10.5	)
Occupancy and related depreciation		18,228			16,803			16,879		17,926			17,056		17,209			16,805			16,825			0.1
Business development expenses		8,296			6,881			8,848		11,086			8,409		7,823			9,801			10,729			9.5
Other		54,821			49,100			54,249		51,125			53,322		48,882			53,584			93,076			73.7

Total non-interest expenses		275,715			265,221			272,697		266,769			283,380		268,454			285,863			331,114			15.8

Income before income taxes		62,765			81,774			95,948		82,308			77,443		83,039			120,753			46,923			(61.1	)
Income tax expense		15,791			19,721			25,218		19,499			19,405		29,423			30,960			24,078			(22.2	)

Net income		46,974			62,053			70,730		62,809			58,038		53,616			89,793			22,845			(74.6	)

Less: Net income attributable to noncontrolling interests		149			873			384		1,543			1,182		1,766			1,831			170			(90.7	)

Net income attributable to NHI shareholders		46,825			61,180			70,346		61,266			56,856		51,850			87,962			22,675			(74.2	)

	Yen																						% Change
Per share of common stock:
Basic-
Net income attributable to NHI shareholders per share		13.00			17.10			19.89		17.38			16.07		14.70			25.55			6.68			(73.9	)

Diluted-
Net income attributable to NHI shareholders per share		12.71			16.68			19.44		17.00			15.77		14.45			25.12			6.56			(73.9	)

– 14 –

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
	For the three months ended
	June 30, 2016			September 30, 2016		December 31, 2016			March 31, 2017			June 30, 2017		September 30, 2017		December 31, 2017(A)		March 31, 2018(B)			(B-A)/(A)

Net revenue

Business segment information:
Retail		83,751			86,164		101,342			103,177			101,684		101,786		111,284		98,154			(11.8	)
Asset Management		25,934			21,277		28,907			23,309			28,097		35,418		36,503		27,319			(25.2	)
Wholesale		190,932			179,863		197,285			171,176			179,316		158,963		165,648		211,406			27.6

Subtotal		300,617			287,304		327,534			297,662			309,097		296,167		313,435		336,879			7.5
Other		48,411			52,111		28,691			54,251			51,707		52,610		89,023		46,153			(48.2	)

Net revenue		349,028			339,415		356,225			351,913			360,804		348,777		402,458		383,032			(4.8	)

Reconciliation items:
Unrealized gain (loss) on investments in equity securities held for operating purposes		(10,548	)		7,580		12,420			(2,836	)		19		2,716		4,158		(4,995	)		—

Net revenue		338,480			346,995		368,645			349,077			360,823		351,493		406,616		378,037			(7.0	)


Non-interest expenses

Business segment information:
Retail		75,086			71,754		75,393			77,409			76,792		76,239		79,997		76,743			(4.1	)
Asset Management		13,695			13,844		14,919			14,636			14,527		14,950		15,671		16,019			2.2
Wholesale		144,290			140,596		149,871			143,052			153,963		141,980		151,602		167,200			10.3

Subtotal		233,071			226,194		240,183			235,097			245,282		233,169		247,270		259,962			5.1
Other		42,644			39,027		32,514			31,672			38,098		35,285		38,593		71,152			84.4

Non-interest expenses		275,715			265,221		272,697			266,769			283,380		268,454		285,863		331,114			15.8

Reconciliation items:
Unrealized gain (loss) on investments in equity securities held for operating purposes		—			—		—			—			—		—		—		—			—

Non-interest expenses		275,715			265,221		272,697			266,769			283,380		268,454		285,863		331,114			15.8


Income (loss) before income taxes

Business segment information:
Retail		8,665			14,410		25,949			25,768			24,892		25,547		31,287		21,411			(31.6	)
Asset Management		12,239			7,433		13,988			8,673			13,570		20,468		20,832		11,300			(45.8	)
Wholesale		46,642			39,267		47,414			28,124			25,353		16,983		14,046		44,206			214.7

Subtotal		67,546			61,110		87,351			62,565			63,815		62,998		66,165		76,917			16.3
Other*		5,767			13,084		(3,823	)		22,579			13,609		17,325		50,430		(24,999	)		—

Income (loss) before income taxes		73,313			74,194		83,528			85,144			77,424		80,323		116,595		51,918			(55.5	)

Reconciliation items:
Unrealized gain (loss) on investments in equity securities held for operating purposes		(10,548	)		7,580		12,420			(2,836	)		19		2,716		4,158		(4,995	)		—

Income (loss) before income taxes		62,765			81,774		95,948			82,308			77,443		83,039		120,753		46,923			(61.1	)

* 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 three months ended
	June 30, 2016			September 30, 2016			December 31, 2016			March 31, 2017			June 30, 2017			September 30, 2017		December 31, 2017(A)			March 31, 2018(B)			(B-A)/(A)
Net gain (loss) related to economic hedging transactions		11,974			(4,119	)		(15,948	)		814			(654	)		558		(8,019	)		1,654			—
Realized gain (loss) on investments in equity securities held for operating purposes		582			74			445			(9	)		43			344		374			24			(93.6	)
Equity in earnings of affiliates		1,058			10,945			10,960			9,379			7,022			8,408		7,801			11,017			41.2
Corporate items		(4,306	)		(5,266	)		(769	)		3,902			154			1,597		(3,386	)		(40,249	)		—
Other		(3,541	)		11,450			1,489			8,493			7,044			6,418		53,660			2,555			(95.2	)

Total		5,767			13,084			(3,823	)		22,579			13,609			17,325		50,430			(24,999	)		—

– 15 –

4.	Other Information

Reclassification in the Consolidated Balance Sheets

From the year ended in March 31, 2018, certain changes in scope of Receivables from customers, Receivables from other than customers, Payables to customers and Payables to other than customers have been made by revisiting the definition of customers in our consolidated balance sheets. We have reclassified previously reported amounts of Receivables from other than customers to Receivables from customers by 159.7 billion yen, from Other assets – Other to Receivables from other than customers by 88.7 billion yen and from Payables to other than customers to Payables to customers by 60.3 billion yen respectively to conform to the current presentation.

Financial information for Nomura Securities Co., Ltd. can be found on the following URL.

http://www.nomuraholdings.com/company/group/nsc/pdf/2018_4q.pdf

– 16 –