Q1 2026 Daiwa Securities Group Inc Earnings Call Transcript
Key Points
- Base income remained high at JPY34.1 billion, indicating stable earnings despite a decline in overall revenue and profit.
- The Wealth Management Division expanded net inflows of wrap account services and maintained high asset-based revenues.
- Equity method income from Global X LLC contributed positively to profits in the Securities Asset Management segment.
- Daiwa Real Estate Asset Management's AUM surpassed JPY1.5 trillion, reaching a record high.
- The Asset Management segment saw steady growth in AUM in both securities and real estate sectors, reaching record highs.
- Net operating revenues decreased by 10.9% to JPY155.2 billion, and ordinary income fell by 14.3%.
- Commissions received were down 12.6%, with significant declines in underwriting, secondary offering, and M&A-related commissions.
- Ordinary income from overseas operations dropped by 35.9%, with notable declines in Europe and Asia.
- The Global Markets and Investment Banking Division experienced a 33.1% decrease in net operating revenue and an 87.1% drop in ordinary income.
- Market volatility, particularly due to tariff policies, negatively impacted performance in the GM&IB segment.
So this is Yoshida from Daiwa Securities Group Inc. Thank you very much for taking the time to join our conference call today. I will now explain the financial results for the first quarter of FY 2025, which were disclosed today using the presentation materials available on our website.
Please turn to page 4. First, I will provide a summary of our consolidated financial results. The percentage changes shown are compared with the fourth quarter of FY 2024. For Q1 of 2025, net operating revenues were JPY155.2 billion, down 10.9%. Ordinary income was JPY43.7 billion, down 14.3%.
Although we saw a decline in both revenue and profit due to the absence of large primary deals that occurred in the previous quarter, base income, which we regard as the key indicator of stable earnings remained high at JPY34.1 billion.
The Wealth Management Division continued to engage in comprehensive or total asset consulting even in a volatile market environment, expanded net inflows of wrap account
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