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 April 2011

 

 

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):               

 

 


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Information furnished on this form:

EXHIBIT

 

Exhibit Number
1.    Financial Summary – Year ended March 2011

Nomura Holdings, Inc. (“Nomura”) hereby incorporates Exhibit 1 to this report on Form 6-K by reference (i) in the prospectus that is part of Registration Statement on Form F-3 (Registration No. 333-169682) of Nomura and Nomura America Finance, LLC, filed with the Securities and Exchange Commission (the “SEC”) on September 30, 2010, and (ii) in the prospectus that is part of the Registration Statement on Form F-3 (Registration No. 333-165049) of Nomura, filed with the SEC on February 24, 2010, as amended by the Post-Effective Amendment No. 1 thereto, filed with the SEC on September 8, 2010.


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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 28, 2011   By:  

/s/ Junko Nakagawa

    Junko Nakagawa
    Executive Managing Director


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Financial Summary For the Year Ended March 31, 2011 (US GAAP)

 

Date:

   April 28, 2011

Company name (code number):

   Nomura Holdings, Inc. (8604)

Stock exchange listings:

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

Representative:

   Kenichi Watanabe
   President and Chief Executive Officer, Nomura Holdings, Inc.

For inquiries:

   Kazuhisa Kishimoto
   Managing Director, Investor Relations Department, 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  
     2011     2010  
     (Millions of yen, except per share data)  
           % Change from
March 31, 2010
          % Change from
March 31, 2009
 

Total revenue

     1,385,492        2.1     1,356,751        104.2

Net revenue

     1,130,698        (1.7 %)      1,150,822        268.1

Income before income taxes

     93,255        (11.4 %)      105,247        —     

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

     28,661        (57.7 %)      67,798        —     

Comprehensive income

     10,306        (86.6 %)      77,195        —     

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

     7.90          21.68     

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

     7.86          21.59     

Return on shareholders’ equity

     1.4       3.7  

Income before income taxes to total assets

     0.3       0.4  

Income before income taxes divided by total revenue

     6.7       7.8  

Equity in earnings of affiliates

     11,602          12,924     

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  
             2011                     2010          
     (Millions of yen, except per share data)  

Total assets

     36,692,990        32,230,428   

Total equity

     2,091,636        2,133,014   

Total NHI shareholders’ equity

     2,082,754        2,126,929   

Total NHI shareholders’ equity as a percentage of total assets

     5.7     6.6

Total NHI shareholders’ equity per share (Yen)

     578.40        579.70   

 

(3) Cash flows

 

    
     For the year ended March 31  
     2011     2010  
     (Millions of yen)  

Net cash used in operating activities

     (235,090     (1,500,770

Net cash used in investing activities

     (423,214     (269,643

Net cash provided by financing activities

     1,284,243        2,176,530   

Cash and cash equivalents at end of period

     1,620,340        1,020,647   

2. Cash dividends

 

     For the year ended March 31  
         2010             2011             2012 (Plan)      
     (Yen amounts, except Total annual dividends)  

Dividends per share

      

dividends record dates

      

At June 30

     —          —          —     

At September 30

     4.00        4.00        Unconfirmed   

At December 31

     —          —          —     

At March 31

     4.00        4.00        Unconfirmed   

For the year

     8.00        8.00        Unconfirmed   

Total annual dividends (Millions of yen)

     25,811        28,810        —     

Consolidated payout ratio

     36.9     101.3     —     

Consolidated dividends as a percentage of shareholders’ equity per share

     1.4     1.4     —     

 

Note: Nomura plans to forgo dividend distribution for Q1 and Q3 of fiscal year 2012. Fiscal year 2012 Q2 and Q4 dividend amounts are not presented per reasons stated in “3. Earnings forecasts for the year ending March 31, 2012”.

3. Earnings forecasts for the year ending March 31, 2012

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.


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4. Others

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

(2) Changes in accounting principles, procedures and presentations

 

  a) Changes due to amendments to the accounting standards : Yes
  b) Changes due to other than a) : None

(3) Number of shares issued (common stock)

 

     At March 31  
     2011      2010  

Number of shares outstanding (including treasury stock)

     3,719,133,241         3,719,133,241   

Number of treasury stock

     118,246,309         50,088,627   
     For the year ended March 31  
     2011      2010  

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

     3,627,798,587         3,126,790,289   

Parent Company Only Operating Results (Japanese GAAP)

(1) Operating Results

 

     For the year ended March 31  
     2011     2010  
     (Millions of yen, except per share data)  
           % Change from
March 31, 2010
           % Change from
March 31, 2009
 

Operating revenue

     219,875        (0.5 %)      220,873         (35.1 %) 

Operating income

     9,812        (73.4 %)      36,930         (72.7 %) 

Ordinary income

     11,690        (59.9 %)      29,121         (77.1 %) 

Net income (loss)

     (15,094     —          12,083         —     

Net profit (loss) per share

     (4.16       3.86      

Fully diluted net profit per share

     —            3.83      

(2) Financial Position

 

     At March 31  
             2011                     2010          
     (Millions of yen, except per share data)  

Total assets

     5,278,581        4,566,078   

Total net assets

     1,764,894        1,806,307   

Total net assets as a percentage of total assets

     32.8     39.0

Total net assets per share

     481.23        485.62   

Shareholders’ equity

     1,733,358        1,782,273   

* Audit procedure

The audit on the consolidated financial statements for this fiscal year has not been completed by the external auditors at the point of disclosing this financial summary. As a result of such audit, certain of the information set forth herein could be subject to revision, possibly material, in Nomura’s Report on Form 20-F for the year ended March 31, 2011.


Table of Contents

Table of Contents for the Accompanying Materials

 

1.    Consolidated Operating Results      P.2   

(1)    Analysis of Consolidated Operating Results

     P.2   

(2)    Analysis of Consolidated Financial Position

     P.5   
2.    Corporate Goals and Principles      P.5   

(1)    Fundamental Management Policy

     P.5   

(2)    Structure of Business Operations

     P.5   

(3)    Management Challenges and Strategies

     P.5   
3.    Consolidated Financial Statements      P.7   

(1)    Consolidated Balance Sheets

     P.8   

(2)    Consolidated Statements of Operations

     P.10   

(3)    Consolidated Statements of Comprehensive Income

     P.11   

(4)    Consolidated Statements of Changes in Equity

     P.12   

(5)    Consolidated Statements of Cash Flows

     P.13   

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

     P.14   

(7)    Significant Changes for Presenting the Consolidated Financial Statements

     P.14   

(8)    Note to the Consolidated Financial Statements

     P.15   
4.    Other Information      P.17   

(1)    Consolidated Statements of Operations – Quarterly Comparatives

     P.17   

(2)    Business Segment Information – Quarterly Comparatives

     P.18   

(3)    Other

     P.19   

 

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1. Consolidated Operating Results

 

(1) Analysis of Consolidated Results

Operating Results

US GAAP

 

     Billions of yen     % Change  
     For the year ended     (A-B)/(B)  
     March 31,
2011 (A)
    March 31,
2010 (B)
   

Net revenue

     1,130.7        1,150.8        (1.7

Non-interest expenses

     1,037.4        1,045.6        (0.8
                        

Income (loss) before income taxes

     93.3        105.2        (11.4

Income tax expense

     61.3        37.2        65.0   
                        

Net income (loss)

     31.9        68.1        (53.1
                        

Less: Net income (loss) attributable to noncontrolling interests

     3.3        0.3        —     
                        

Net income (loss) attributable to NHI shareholders

     28.7        67.8        (57.7
                        

Return on shareholders’ equity*

     1.4     3.7     —     
                        

 

* 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 1,130.7 billion yen for the fiscal year ended March 31, 2011, a decrease of 1.7% from the previous year. Non-interest expenses decreased 0.8% from the previous year to 1,037.4 billion yen. Income before income taxes was 93.3 billion yen and Net income attributable to NHI shareholders was 28.7 billion yen for the fiscal year ended March 31, 2011.

Segment Information

 

     Billions of yen      % Change  
     For the year ended      (A-B)/(B)  
     March 31,
2011 (A)
     March 31,
2010 (B)
    

Net revenue

     1,147.6         1,141.4         0.5   

Non-interest expenses

     1,037.4         1,045.6         (0.8
                          

Income (loss) before income taxes

     110.2         95.8         14.9   
                          

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, 2011 was 1,147.6 billion yen, an increase of 0.5% from the previous year. Non-interest expenses decreased by 0.8% from the previous year to 1,037.4 billion yen. Income before income taxes was 110.2 billion yen for the fiscal year ended March 31, 2011. Please refer to page 15 for further details of the differences between US GAAP and business segment amounts.

 

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<Business Segment Results>

In April 2010, Nomura realigned its reporting segments in relation to how it operates and manages its business by merging the Global Markets, Investment Banking, and Merchant Banking divisions into the Wholesale division. Nomura now divides its business segments into three divisions of Retail, Asset Management and Wholesale.

Operating Results of Retail

 

     Billions of yen      % Change  
     For the year ended      (A-B)/(B)  
     March 31,
2011 (A)
     March 31,
2010 (B)
    

Net revenue

     392.4         388.3         1.1   

Non-interest expenses

     291.2         274.9         5.9   
                          

Income (loss) before income taxes

     101.2         113.4         (10.7
                          

Net revenue increased by 1.1% from the previous year to 392.4 billion yen, due primarily to increasing revenues from bond related products and investment trust related products. Non-interest expenses increased by 5.9% to 291.2 billion yen. As a result, income before income taxes decreased by 10.7% to 101.2 billion yen.

Operating Results of Asset Management

 

     Billions of yen      % Change  
     For the year ended      (A-B)/(B)  
     March 31,
2011 (A)
     March 31,
2010 (B)
    

Net revenue

     80.7         70.4         14.8   

Non-interest expenses

     55.7         51.8         7.6   
                          

Income (loss) before income taxes

     25.1         18.6         34.7   
                          

Net revenue increased by 14.8% from the previous year to 80.7 billion yen. Non-interest expenses increased by 7.6% to 55.7 billion yen. As a result, income before income taxes increased by 34.7% to 25.1 billion yen. Assets under management were 24.7 trillion yen at the end of March 2011.

 

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Operating Results of Wholesale

 

     Billions of yen      % Change  
     For the year ended      (A-B)/(B)  
     March 31,
2011 (A)
     March 31,
2010 (B)
    

Net revenue

     630.5         789.5         (20.1

Non-interest expenses

     623.8         614.3         1.5   
                          

Income (loss) before income taxes

     6.7         175.2         (96.2
                          

Net revenue decreased by 20.1% from the previous year to 630.5 billion yen, due primarily to decrease in net gain on trading. Non-interest expenses increased by 1.5% to 623.8 billion yen. As a result, income before income taxes decreased by 96.2% to 6.7 billion yen.

Other Operating Results

 

     Billions of yen     % Change  
     For the year ended     (A-B)/(B)  
     March 31,
2011 (A)
    March 31,
2010 (B)
   

Net revenue

     43.9        (106.8     —     

Non-interest expenses

     66.7        104.5        (36.2
                        

Income (loss) before income taxes

     (22.8     (211.3     —     
                        

Net revenue was 43.9 billion yen. Loss before income taxes was 22.8 billion yen.

Earnings Forecasts for Next Fiscal Year

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.

 

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(2) Analysis of Consolidated Financial Position

Total assets as of March 31, 2011, were 36.7 trillion yen, an increase of 4.5 trillion yen compared to March 31, 2010, reflecting primarily the increase in Securities purchased under agreements to resell. Total liabilities as of March 31, 2011 were 34.6 trillion yen, an increase of 4.5 trillion yen compared to March 31, 2010, mainly due to the increase in Securities sold under agreements to repurchase and Long-term borrowings. Total equity as of March 31, 2011 was 2.1 trillion yen, a decrease of 41.4 billion yen compared to March 31, 2010.

Cash and cash equivalents as of March 31, 2011, increased by 599.7 billion yen compared to March 31, 2010. Cash flows from operating activities for the year ended March 31, 2011 were outflows of 235.1 billion yen due to the increase in Trading assets. Cash flows from investing activities for the year ended March 31, 2011 were outflows of 423.2 billion yen due mainly to increase in Non-trading debt securities, net. Cash flows from financing activities for the year ended March 31, 2011 were inflows of 1,284.2 billion yen due primarily to an increase in Long-term borrowings.

 

2. Corporate Goals and Principles

 

(1) Fundamental Management Policy

Nomura Group is committed to a management vision of firmly establishing ourselves as a globally competitive financial services group. We will seek to realize this vision and increase shareholder value by strengthening our base in the Japanese securities businesses, developing world-class businesses in other regions, and consolidating our comprehensive global strength.

We will establish our new growth model by working with our clients, providing them with the best solutions, and realizing the expansion of our business in new domains. Our management target is to maintain an average consolidated return on shareholders’ equity (ROE) of 10% to 15% over the medium to long term. However, we cannot deny that the capital requirements that are under consideration by Basel Committee on Banking Supervision or other financial regulators may impact us.

In addition, we put high priority on compliance with applicable laws, regulations and proper corporate behavior, and we build compliance into our daily business operations.

 

(2) Structure of Business Operations

Nomura Group is organized around globally-linked business divisions under a unified strategy, rather than individual legal entities. Nomura Group’s operations are comprised of Retail, Asset Management, and Wholesale. We will strive to achieve a higher level of specialization in each division, advance and progress our business in each respective area, and maximize the collective strength of Nomura Group by enhancing cross-divisional and regional collaboration.

 

(3) Management Challenges and Strategies

Although the global economy was moving gradually toward normality supported by emerging markets, it is facing uncertainty due to the unstable political situation in the Middle East, sovereign crisis in Europe and the earthquake in Tohoku region of Japan in March. In this environment, we plan to address the needs of our clients globally by taking advantage of our strengthened business platform and to grow our client base and improve our market share. We will continue to strategically allocate management resources in order to work toward providing stability and liquidity through properly functioning market.

In addition, we will continue to proceed with our plans to reduce costs by reengineering businesses to fit the market environment and increase operational efficiency.

 

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We will also implement the following initiatives:

[Retail Division]

At Retail Division, we will continue to enhance our products and service offerings, which are provided through direct contacts, online or via call centers to accommodate increasingly sophisticated and diverse client needs. We aim to continue being a trusted partner to our clients by providing world-class products and services that meet their individual needs.

[Asset Management Division]

In investment trust business, we aim to provide individual clients with a diverse range of investment opportunities to meet investors’ demand, and in advisory business, we aim to provide institutional clients globally with value-added investment service. Together, we intend to increase assets under management and expand our client base.

We aim to increase our world-class competitive advantage in Japan and the rest of Asia by making continuous effort to improve investment performance and by aggressively expanding our investment management and product delivery capabilities.

[Wholesale Division]

Wholesale Division has been established in April 2010.

Global Markets will enhance our product development expertise to continue acting as the product supply hub for Nomura and also work to expand profitability. We will focus on delivering high value-added products and solutions to our clients by leveraging our global trading infrastructure and making full use of our strengthened business franchise. In Fixed Income, we will strengthen not only our global marketing structure but also our trading and product development capabilities. In Equities, we will continue to act as a world-class liquidity provider. Through even closer co-operation between Fixed Income and Equities we will aim for synergies in structuring, research, distribution, and risk management.

In Investment Banking, we are expanding our M&A advisory and corporate finance businesses to diversify sources of profit by providing high value-added solutions to meet the individual needs of each client. We aim to enhance our presence as a global investment bank headquartered in Asia that provides world-class services, while continuing to build our business in Japan.

In implementing the initiatives outlined above, we will enhance collaboration between the divisions. We aim to consolidate our comprehensive global strength to realize our management objectives and maximize shareholder value by enhancing profitability across our businesses, while helping to strengthen the global financial and capital markets.

[Other]

In the wake of the financial crisis, the market and regulatory environments surrounding global financial institutions have changed significantly. To deal appropriately with these changes, we bolstered our financial base in order to achieve sustainable growth. Going forward, we will continue to maximize the profitability of the group as a whole, and to maintain adequate allocation of management resources. We will also continue to provide effort to grow our client-focused business platform while providing world-class, high quality solution.

We will continue to be prepared for regulation tightening. We will keep close monitoring of global regulatory trends and try to be prepared.

We understand that it is necessary to further strengthen our global risk management systems. By adopting a proactive, rather than a reactive, risk management approach, top management has directly engaged in risk management-related decision-making. We will continue to strengthen this type of system. As our business becomes increasingly international, we recognize the growing importance of compliance. In addition to complying with laws and regulations, we view compliance in a wider context, and will further enhance Nomura group’s overall compliance system.

 

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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 29, 2010) and Form 20-F (the annual report filed with the U.S. Securities and Exchange Commission on June 29, 2010) for the year ended March 31, 2010.

In relation to significant changes to accounting principles, procedures and presentations (changes in accordance with amendments to the accounting standards), please refer to “(7) Significant Changes for Presenting the Consolidated Financial Statements”.

 

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(1) Consolidated Balance Sheets (UNAUDITED)

 

     Millions of yen  
     March 31,
2011
    March 31,
2010
    Increase/
(Decrease)
 
ASSETS       

Cash and cash deposits:

      

Cash and cash equivalents

     1,620,340        1,020,647        599,693   

Time deposits

     339,419        196,909        142,510   

Deposits with stock exchanges and other segregated cash

     190,694        134,688        56,006   
                        

Cash and cash deposits, Total

     2,150,453        1,352,244        798,209   
                        

Loans and receivables:

      

Loans receivable

     1,271,284        1,310,375        (39,091

Receivables from customers

     32,772        59,141        (26,369

Receivables from other than customers

     928,626        707,623        221,003   

Allowance for doubtful accounts

     (4,860     (5,425     565   
                        

Loans and receivables, Total

     2,227,822        2,071,714        156,108   
                        

Collateralized agreements:

      

Securities purchased under agreements to resell

     9,558,617        7,073,926        2,484,691   

Securities borrowed

     5,597,701        5,393,287        204,414   
                        

Collateralized agreements, Total

     15,156,318        12,467,213        2,689,105   
                        

Trading assets and private equity investments:

      

Trading assets*

     14,952,511        14,374,028        578,483   

Private equity investments

     289,420        326,254        (36,834
                        

Trading assets and private equity investments, Total

     15,241,931        14,700,282        541,649   
                        

Other assets:

      

Office buildings, land, equipment and facilities

(net of accumulated depreciation and amortization of
¥300,075 million at March 31, 2011 and
¥273,616 million at March 31, 2010)

     392,036        357,194        34,842   

Non-trading debt securities*

     591,797        308,814        282,983   

Investments in equity securities*

     91,035        122,948        (31,913

Investments in and advances to affiliated companies*

     273,105        251,273        21,832   

Other

     568,493        598,746        (30,253
                        

Other assets, Total

     1,916,466        1,638,975        277,491   
                        

Total assets

     36,692,990        32,230,428        4,462,562   
                        

 

* Including securities pledged as collateral

 

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     Millions of yen  
     March 31,
2011
    March 31,
2010
    Increase/
(Decrease)
 
LIABILITIES AND EQUITY       

Short-term borrowings

     1,167,077        1,301,664        (134,587

Payables and deposits:

      

Payables to customers

     880,429        705,302        175,127   

Payables to other than customers

     410,679        374,522        36,157   

Deposits received at banks

     812,500        448,595        363,905   
                        

Payables and deposits, Total

     2,103,608        1,528,419        575,189   
                        

Collateralized financing:

      

Securities sold under agreements to repurchase

     10,813,797        8,078,020        2,735,777   

Securities loaned

     1,710,191        1,815,981        (105,790

Other secured borrowings

     1,162,450        1,322,480        (160,030
                        

Collateralized financing, Total

     13,686,438        11,216,481        2,469,957   
                        

Trading liabilities

     8,688,998        8,356,806        332,192   

Other liabilities

     552,316        494,983        57,333   

Long-term borrowings

     8,402,917        7,199,061        1,203,856   
                        

Total liabilities

     34,601,354        30,097,414        4,503,940   
                        

Equity

      

NHI shareholders’ equity:

      

Common stock

      

  Authorized    -    6,000,000,000 shares

      

Issued    -    3,719,133,241 shares at March 31, 2011 and
               3,719,133,241 shares at March 31, 2010

      

Outstanding    -    3,600,886,932 shares at March 31, 2011 and
                        3,669,044,614 shares at March 31, 2010

     594,493        594,493        —     

Additional paid-in capital

     646,315        635,828        10,487   

Retained earnings

     1,069,334        1,074,213        (4,879

Accumulated other comprehensive income (1oss)

     (129,696     (109,132     (20,564
                        

Total NHI shareholders’ equity before treasury stock

     2,180,446        2,195,402        (14,956

Common stock held in treasury, at cost -

      

118,246,309 shares at March 31, 2011 and

      

50,088,627 shares at March 31, 2010

     (97,692     (68,473     (29,219
                        

Total NHI shareholders’ equity

     2,082,754        2,126,929        (44,175
                        

Noncontrolling interests

     8,882        6,085        2,797   
                        

Total equity

     2,091,636        2,133,014        (41,378
                        

Total liabilities and equity

     36,692,990        32,230,428        4,462,562   
                        

 

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(2) Consolidated Statements of Operations (UNAUDITED)

 

     Millions of yen      % Change  
     For the year ended      (A-B)/(B)  
     March 31,
2011 (A)
    March 31,
2010 (B)
    

Revenue:

       

Commissions

     405,463        395,083         2.6   

Fees from investment banking

     107,005        121,254         (11.8

Asset management and portfolio service fees

     143,939        132,249         8.8   

Net gain on trading

     336,503        417,424         (19.4

Gain on private equity investments

     19,292        11,906         62.0   

Interest and dividends

     346,103        235,310         47.1   

Gain (loss) on investments in equity securities

     (16,677     6,042         —     

Other

     43,864        37,483         17.0   
                         

Total revenue

     1,385,492        1,356,751         2.1   

Interest expense

     254,794        205,929         23.7   
                         

Net revenue

     1,130,698        1,150,822         (1.7
                         

Non-interest expenses:

       

Compensation and benefits

     518,993        526,238         (1.4

Commissions and floor brokerage

     92,088        86,129         6.9   

Information processing and communications

     182,918        175,575         4.2   

Occupancy and related depreciation

     87,843        87,806         0.0   

Business development expenses

     30,153        27,333         10.3   

Other

     125,448        142,494         (12.0
                         

Non-interest expenses, Total

     1,037,443        1,045,575         (0.8
                         

Income before income taxes

     93,255        105,247         (11.4

Income tax expense

     61,330        37,161         65.0   
                         

Net income

     31,925        68,086         (53.1
                         

Less: Net income attributable to noncontrolling interests

     3,264        288         —     
                         

Net income attributable to NHI shareholders

     28,661        67,798         (57.7
                         
     Yen      % Change  

Per share of common stock:

       

Basic-

       

Net income attributable to NHI shareholders per share

     7.90        21.68         (63.6
                         

Diluted-

       

Net income attributable to NHI shareholders per share

     7.86        21.59         (63.6
                         

 

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(3) Consolidated Statements of Comprehensive Income (UNAUDITED)

 

     Millions of yen     % Change  
     For the year ended     (A-B)/(B)  
     March 31,
2011 (A)
    March 31,
2010 (B)
   

Net income

     31,925        68,086        (53.1

Other comprehensive income (loss):

      

Change in cumulative translation adjustments, net of tax

     (24,151     (1,057     —     

Defined benefit pension plans:

      

Pension liability adjustment

     4,074        18,339        (77.8

Deferred income taxes

     (1,542     (8,173     —     
                        

Total

     2,532        10,166        (75.1
                        

Total other comprehensive income (loss)

     (21,619     9,109        —     
                        

Comprehensive income

     10,306        77,195        (86.6

Less: Comprehensive income attributable to noncontrolling interest in subsidiary

     2,209        92        —     
                        

Comprehensive income attributable to NHI shareholders

     8,097        77,103        (89.5
                        

 

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(4) Consolidated Statements of Changes in Equity (UNAUDITED)

 

     Millions of yen  
     For the year ended  
     March 31, 2011     March 31, 2010  

Common stock

    

Balance at beginning of year

     594,493        321,765   

Issuance of common stock

     —          217,728   

Conversion of convertible bonds

     —          55,000   
                

Balance at end of year

     594,493        594,493   
                

Additional paid-in capital

    

Balance at beginning of year

     635,828        374,413   

Cumulative effect of change in accounting principle (1)

     —          (26,923

Issuance of common stock

     —          228,934   

Conversion of convertible bonds

     —          55,000   

Gain on sales of treasury stock

     3,191        5,702   

Issuance and exercise of common stock options

     7,296        (4,242

Beneficial conversion feature relating to convertible bond

     —          2,959   

Other net change in additional paid-in capital

     —          (15
                

Balance at end of year

     646,315        635,828   
                

Retained earnings

    

Balance at beginning of year

     1,074,213        1,038,557   

Cumulative effect of change in accounting principle (1)(2)

     (4,734     (6,339

Net income attributable to NHI shareholders

     28,661        67,798   

Cash dividends

     (28,806     (25,803
                

Balance at end of year

     1,069,334        1,074,213   
                

Accumulated other comprehensive income (1oss)

    

Cumulative translation adjustments

    

Balance at beginning of year

     (74,330     (73,469

Net change during the period

     (23,096     (861
                

Balance at end of year

     (97,426     (74,330
                

Defined benefit pension plans

    

Balance at beginning of year

     (34,802     (44,968

Pension liability adjustment

     2,532        10,166   
                

Balance at end of year

     (32,270     (34,802
                

Balance at end of year

     (129,696     (109,132
                

Common stock held in treasury

    

Balance at beginning of year

     (68,473     (76,902

Repurchases of common stock

     (37,378     (18

Sale of common stock

     4        13   

Common stock issued to employees

     8,155        8,275   

Other net change in treasury stock

     —          159   
                

Balance at end of year

     (97,692     (68,473
                

Total NHI shareholders’ equity

    
                

Balance at end of year

     2,082,754        2,126,929   
                

Noncontrolling interests

    

Balance at beginning of year

     6,085        12,150   

Net change during the period

     2,797        (6,065
                

Balance at end of year

     8,882        6,085   
                

Total equity

    
                

Balance at end of year

     2,091,636        2,133,014   
                

 

Notes:

1. Cumulative effect of change in accounting principle for the year ended March 31, 2010 was previously reported as Adjustments to initially apply “Contracts in entity’s own equity”.
2. In relation to the change in Cumulative effect of change in accounting principle for the year ended March 31, 2011, refer to section “(7) Significant Changes for Presenting the Consolidated Financial Statements”.

 

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(5) Consolidated Statements of Cash Flows (UNAUDITED)

 

     Millions of yen  
     For the year ended  
     March 31, 2011     March 31, 2010  

Cash flows from operating activities:

    

Net income

     31,925        68,086   

Adjustments to reconcile net income to net cash used in operating activities:

    

Depreciation and amortization

     75,587        73,081   

(Gain) loss on investments in equity securities

     16,677        (6,042

Changes in operating assets and liabilities:

    

Time deposits

     (155,251     348,003   

Deposits with stock exchanges and other segregated cash

     (67,738     142,416   

Trading assets and private equity investments

     (1,481,908     (3,123,679

Trading liabilities

     1,206,394        3,737,079   

Securities purchased under agreements to resell, net of securities sold under agreements to repurchase

     327,668        (1,437,635

Securities borrowed, net of securities loaned

     (446,152     (69,472

Other secured borrowings

     (160,031     (1,591,535

Loans and receivables, net of allowance for doubtful accounts

     (354,691     (248,175

Payables

     319,506        139,919   

Bonus accrual

     (8,802     30,784   

Other, net

     461,726        436,400   
                

Net cash used in operating activities

     (235,090     (1,500,770
                

Cash flows from investing activities:

    

Payments for purchases of office buildings, land, equipment and facilities

     (186,350     (83,079

Proceeds from sales of office buildings, land, equipment and facilities

     109,888        2,909   

Payments for purchases of investments in equity securities

     (221     (2,318

Proceeds from sales of investments in equity securities

     3,247        1,272   

Increase in loans receivable at banks, net

     (60,350     (105,800

Increase in non-trading debt securities, net

     (286,013     (64,586

Other, net

     (3,415     (18,041
                

Net cash used in investing activities

     (423,214     (269,643
                

Cash flows from financing activities:

    

Increase in long-term borrowings

     2,267,658        3,059,225   

Decrease in long-term borrowings

     (1,188,034     (1,470,978

Increase (decrease) in short-term borrowings, net

     (97,282     137,076   

Increase in deposits received at banks, net

     368,354        13,279   

Proceeds from issuances of common stock held in treasury

     —          446,662   

Proceeds from sales of common stock held in treasury

     8        10   

Payments for repurchases of common stock in treasury

     (37,378     (18

Payments for cash dividends

     (29,083     (11,130

Proceeds from issuances of stock by subsidiaries

     —          2,404   
                

Net cash provided by financing activities

     1,284,243        2,176,530   
                

Effect of exchange rate changes on cash and cash equivalents

     (26,246     964   
                

Net increase in cash and cash equivalents

     599,693        407,081   

Cash and cash equivalents at beginning of the year

     1,020,647        613,566   
                

Cash and cash equivalents at end of the year

     1,620,340        1,020,647   
                

 

Note: Certain reclassifications of previously reported amounts have been made to conform to the current year presentation.

 

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Table of Contents
(6) Note with respect to the Assumption as a Going Concern (UNAUDITED)

Not applicable.

 

(7) Significant Changes for Presenting the Consolidated Financial Statements (UNAUDITED)

Presentations of significant changes in accounting principles are as follows:

Transfers of financial assets and consolidation of variable interest entities—

On April 1, 2010, Nomura adopted amendments to Accounting Standard Codification Topic (“ASC”) 810 “Consolidation” introduced by Accounting Standards Update (“ASU”) 2009-17. The ASU revises the definition of a variable interest entity (“VIE”), when a reporting entity is required to consolidate a VIE and when reassessment of a consolidation decision is required. As a result, the balance of the retained earnings at the beginning of the year has been adjusted.

Also on April 1, 2010, Nomura adopted amendments to ASC 860 “Transfers and Servicing” introduced by ASU 2009-16. The ASU revises the accounting for transfers of financial assets and eliminates the concept of a qualifying special purpose entity (“QSPE”). Entities formerly meeting the definition of a QSPE are now evaluated for consolidation under the revised consolidation guidance provided by ASC 810 as amended by ASU 2009-17.

Net investment hedge—

On April 1, 2010, Nomura adopted net investment hedging to mitigate foreign exchange risks created by some significant foreign subsidiaries. Accordingly, the net translation adjustment amount recognized in the consolidation processes is offset by the effective portion of the foreign exchange gains (or losses) on the hedging instruments for net investment in such foreign subsidiaries.

 

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(8) Note to the Consolidated Financial Statements (UNAUDITED)

Segment Information – Operating Segment

The following table shows business segment information and reconciliation items to the consolidated statements of operations. Business segment has been divided into three divisions consisting of Retail, Asset Management and Wholesale from this fiscal year.

 

     Millions of yen     % Change  
     For the year ended     (A-B)/(B)  
     March 31,
2011 (A)
    March 31,
2010 (B)
   

Net revenue

      

Business segment information:

      

Retail

     392,433        388,272        1.1   

Asset Management

     80,744        70,365        14.8   

Wholesale

     630,536        789,531        (20.1
                        

Sub Total

     1,103,713        1,248,168        (11.6

Other

     43,881        (106,753     —     
                        

Net revenue

     1,147,594        1,141,415        0.5   
                        

Reconciliation items:

      

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

     (16,896     9,407        —     
                        

Net revenue

     1,130,698        1,150,822        (1.7
                        

Non-interest expenses

      

Business segment information:

      

Retail

     291,245        274,915        5.9   

Asset Management

     55,691        51,771        7.6   

Wholesale

     623,819        614,349        1.5   
                        

Sub Total

     970,755        941,035        3.2   

Other

     66,688        104,540        (36.2
                        

Non-interest expenses

     1,037,443        1,045,575        (0.8
                        

Reconciliation items:

      

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

     —          —          —     
                        

Non-interest expenses

     1,037,443        1,045,575        (0.8
                        

Income (loss) before income taxes

      

Business segment information:

      

Retail

     101,188        113,357        (10.7

Asset Management

     25,053        18,594        34.7   

Wholesale

     6,717        175,182        (96.2
                        

Sub Total

     132,958        307,133        (56.7

Other *

     (22,807     (211,293     —     
                        

Income (loss) before income taxes

     110,151        95,840        14.9   
                        

Reconciliation items:

      

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

     (16,896     9,407        —     
                        

Income (loss) before income taxes

     93,255        105,247        (11.4
                        

 

 

* 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     (A-B)/(B)  
     March 31,
2011 (A)
    March 31,
2010 (B)
   

Net gain (loss) related to economic hedging transactions

     2,290        3,323        (31.1

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

     219        (3,365     —     

Equity in earnings of affiliates

     8,996        7,765        15.9   

Corporate items

     (33,327     (83,291     —     

Others

     (985     (135,725     —     
                        

Total

     (22,807     (211,293     —     
                        

Note: Certain reclassifications of previously reported amounts have been made to conform to the current year presentation.

 

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Table of Contents

Per share data

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

 

Number of shares outstanding as of March 31, 2011

     3,600,886,932   

Net income (loss) 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, 2011

     3,627,798,587   

Significant Subsequent Events

Not applicable.

 

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4. Other Information

 

(1) Consolidated Statements of Operations – Quarterly Comparatives (UNAUDITED)

 

    Millions of yen     % Change  
    For the three months ended     (B-A)/(A)  
    June 30,
2009
    September 30,
2009
    December 31,
2009
    March 31,
2010
    June 30,
2010
    September 30,
2010
    December 31,
2010 (A)
    March 31,
2011 (B)
   

Revenue:

                 

Commissions

    102,024        95,438        101,050        96,571        118,078        83,520        100,041        103,824        3.8   

Fees from investment banking

    29,729        15,580        44,516        31,429        20,366        24,892        33,974        27,773        (18.3

Asset management and portfolio service fees

    30,331        34,016        34,235        33,667        34,854        33,712        37,119        38,254        3.1   

Net gain on trading

    121,132        148,487        66,481        81,324        59,969        102,993        104,878        68,663        (34.5

Gain (loss) on private equity investments

    (2,139     2,033        2,342        9,670        (946     (963     (2,386     23,587        —     

Interest and dividends

    58,427        53,561        67,414        55,908        75,757        69,960        106,880        93,506        (12.5

Gain (loss) on investments in equity securities

    9,801        (2,308     (3,827     2,376        (10,343     (5,685     2,106        (2,755     —     

Other

    14,290        8,663        9,377        5,153        16,281        11,989        3,422        12,172        255.7   
                                                                       

Total revenue

    363,595        355,470        321,588        316,098        314,016        320,418        386,034        365,024        (5.4

Interest expense

    65,236        55,445        47,050        38,198        54,192        44,795        90,167        65,640        (27.2
                                                                       

Net revenue

    298,359        300,025        274,538        277,900        259,824        275,623        295,867        299,384        1.2   
                                                                       

Non-interest expenses:

                 

Compensation and benefits

    138,081        146,633        126,239        115,285        122,087        126,694        143,131        127,081        (11.2

Commissions and floor brokerage

    20,043        21,706        22,922        21,458        23,681        21,357        24,013        23,037        (4.1

Information processing and communications

    40,160        43,924        43,919        47,572        44,253        46,662        44,209        47,794        8.1   

Occupancy and related depreciation

    21,992        22,598        21,298        21,918        22,511        23,086        20,507        21,739        6.0   

Business development expenses

    6,256        6,380        6,544        8,153        7,159        6,780        7,429        8,785        18.3   

Other

    40,406        31,492        35,659        34,937        33,663        29,446        28,804        33,535        16.4   
                                                                       
    266,938        272,733        256,581        249,323        253,354        254,025        268,093        261,971        (2.3
                                                                       

Income before income taxes

    31,421        27,292        17,957        28,577        6,470        21,598        27,774        37,413        34.7   

Income tax expense

    20,678        (1,049     7,745        9,787        3,440        19,660        14,483        23,747        64.0   
                                                                       

Net income

    10,743        28,341        10,212        18,790        3,030        1,938        13,291        13,666        2.8   
                                                                       

Less: Net income (loss) attributable to noncontrolling interests

    (677     626        (24     363        708        887        (98     1,767        —     
                                                                       

Net income attributable to NHI shareholders

    11,420        27,715        10,236        18,427        2,322        1,051        13,389        11,899        (11.1
                                                                       
    Yen     % Change  

Per share of common stock:

                 

Basic-

                 

Net income attributable to NHI shareholders per share

    4.37        10.22        2.91        5.02        0.63        0.29        3.72        3.30        (11.3
                                                                       

Diluted-

                 

Net income attributable to NHI shareholders per share

    1.81        8.87        2.89        5.00        0.63        0.29        3.70        3.28        (11.4
                                                                       

 

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Table of Contents
(2) Business Segment Information – Quarterly Comparatives (UNAUDITED)

The following table shows quarterly business segment information and reconciliation items to the consolidated statements of operations. Business segment has been divided into three divisions consisting of Retail, Asset Management and Wholesale from this fiscal year.

 

    Millions of yen     % Change  
    For the three months ended     (B-A)/(A)  
    June 30,
2009
    September 30,
2009
    December 31,
2009
    March 31,
2010
    June 30,
2010
    September 30,
2010
    December 31,
2010 (A)
    March 31,
2011 (B)
   

Net revenue

                 

Business segment information:

                 

Retail

    95,380        93,150        104,290        95,452        110,959        87,753        97,482        96,239        (1.3

Asset Management

    18,650        16,467        17,247        18,001        18,119        19,304        21,396        21,925        2.5   

Wholesale

    211,720        199,304        210,091        168,416        108,609        163,405        172,174        186,348        8.2   
                                                                       

Sub Total

    325,750        308,921        331,628        281,869        237,687        270,462        291,052        304,512        4.6   

Other

    (37,139     (7,056     (53,198     (9,360     32,730        10,133        3,100        (2,082     —     
                                                                       

Net revenue

    288,611        301,865        278,430        272,509        270,417        280,595        294,152        302,430        2.8   
                                                                       

Reconciliation items:

                 

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

    9,748        (1,840     (3,892     5,391        (10,593     (4,972     1,715        (3,046     —     
                                                                       

Net revenue

    298,359        300,025        274,538        277,900        259,824        275,623        295,867        299,384        1.2   
                                                                       

Non-interest expenses

                 

Business segment information:

                 

Retail

    67,521        66,796        69,119        71,479        73,216        64,975        74,482        78,572        5.5   

Asset Management

    13,521        11,994        13,166        13,090        13,220        14,083        14,410        13,978        (3.0

Wholesale

    158,458        161,110        161,584        133,197        149,755        155,764        161,389        156,911        (2.8
                                                                       

Sub Total

    239,500        239,900        243,869        217,766        236,191        234,822        250,281        249,461        (0.3

Other

    27,438        32,833        12,712        31,557        17,163        19,203        17,812        12,510        (29.8
                                                                       

Non-interest expenses

    266,938        272,733        256,581        249,323        253,354        254,025        268,093        261,971        (2.3
                                                                       

Reconciliation items:

                 

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

    —          —          —          —          —          —          —          —          —     
                                                                       

Non-interest expenses

    266,938        272,733        256,581        249,323        253,354        254,025        268,093        261,971        (2.3
                                                                       

Income (loss) before income taxes

                 

Business segment information:

                 

Retail

    27,859        26,354        35,171        23,973        37,743        22,778        23,000        17,667        (23.2

Asset Management

    5,129        4,473        4,081        4,911        4,899        5,221        6,986        7,947        13.8   

Wholesale

    53,262        38,194        48,507        35,219        (41,146     7,641        10,785        29,437        172.9   
                                                                       

Sub Total

    86,250        69,021        87,759        64,103        1,496        35,640        40,771        55,051        35.0   

Other *

    (64,577     (39,889     (65,910     (40,917     15,567        (9,070     (14,712     (14,592     —     
                                                                       

Income (loss) before income taxes

    21,673        29,132        21,849        23,186        17,063        26,570        26,059        40,459        55.3   
                                                                       

Reconciliation items:

                 

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

    9,748        (1,840     (3,892     5,391        (10,593     (4,972     1,715        (3,046     —     
                                                                       

Income (loss) before income taxes

    31,421        27,292        17,957        28,577        6,470        21,598        27,774        37,413        34.7   
                                                                       

 

 

* 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 three months ended     (B-A)/(A)  
    June 30,
2009
    September 30,
2009
    December 31,
2009
    March 31,
2010
    June 30,
2010
    September 30,
2010
    December 31,
2010 (A)
    March 31,
2011 (B)
   

Net gain (loss) related to economic hedging transactions

    5,350        8,589        (13,316     2,700        5,228        (6,019     5,168        (2,087     —     

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

    53        (468     65        (3,015     250        (713     391        291        (25.6

Equity in earnings of affiliates

    3,701        602        1,877        1,585        363        1,993        1,380        5,260        281.2   

Corporate items

    (24,896     (19,588     (10,693     (28,114     (2,486     5,512        (15,668     (20,685     —     

Others

    (48,785     (29,024     (43,843     (14,073     12,212        (9,843     (5,983     2,629        —     
                                                                       

Total

    (64,577     (39,889     (65,910     (40,917     15,567        (9,070     (14,712     (14,592     —     
                                                                       

Note: Certain reclassifications of previously reported amounts have been made to conform to the current year presentation.

 

 

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Table of Contents
(3) Other

Financial information for Nomura Holdings, Inc. (unconsolidated) can be found on the following URL.

http://www.nomuraholdings.com/company/group/holdings/pdf/2011_4q.pdf

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

http://www.nomuraholdings.com/company/group/nsc/pdf/2011_4q.pdf

 

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