March 2005 Interim Financial Conditions For the half-year ended - PowerPoint PPT Presentation

Financial Innovator New Industry Creator Self – Evolution Social Responsibility March 2005 Interim Financial Conditions （ For the half-year ended September 30,2004 ） SOFTBANK INVESTMENT CORPORATION October 26, 2004 The items in this document are provided by Softbank Investment Corporation as information related to its business strategy and not as an invitation to invest in Softbank stock or securities. Softbank does not guarantee the completeness of this document in terms of information and future business strategy. The content of this document is subject to revision or cancellation without warning.

1 . I n t e r i m C o n s o l i d a t e d A c c o u n t s （ For the half-year ended September 30,2004 ）

Interim Consolidated Financial Performance (Compared to Same Period of Previous Year) (Unit: 1 million yen) 2005/3 2005/3 2004/3 2004/3 Change from Change from Interim Interim Interim Interim previous year (%) previous year (%) (2004/4 to 2004/9) (2004/4 to 2004/9) (2003/4 to 2003/9) (2003/4 to 2003/9) ３ ０ ， ２ ９ １ Sales +311.3 ７ ， ３ ６ ５ ８ ， ３ ８ ３ Operating １ ， ８ ９ ６ +342.0 Profit １ ０ ， １ １ ３ Ordinary １ ， ８ ３ １ +452.0 Profit ７ ， ２ ３ ５ Profit of ７ ７ ９ +828.3 Current Term * The interim performance for March 2003 contains the consolidated results from June to September of the former E ＊ Trade K.K. * The interim performance for March 2003 does not contain the consolidated results of the World Nichiei Frontier Securities Co., Ltd., the Fides Securities Corporation, the Finance All Corporation, or any of their respective subsidiaries. * The results of E*Trade Korea Co., Ltd. and Swan Credit Co., Ltd. who became new consolidated subsidiaries before the end of the interim are included from the start of the term. The interim performance does not contain the results of Ace Securities Co., Ltd. and Morning Star Japan K.K.

2 . I n t e r i m C o n d i t i o n s b y S e g m e n t

( 1 ) A s s e t M a n a g e m e n t

Asset Management Highlights 1. Period of harvest for IT funds There is a huge increase in stocks with unrealized profits. On the other hand, capital gains can be made through timely market selling. ・ Profits from selling IT fund stocks during the interim are nearly 26.4 billion yen. 2 . Smooth investment climate for initial public offerings and M&A The original estimate of 20 companies (January to December 2004) has been achieved. ・ From October 26 to the present time: IPO and M&A performance is 16 companies and listing approval performance is the two companies below. • 2004/11/15 expected listing: Elpeda Memory Inc. • 2004/11/25 expected listing: Kawaden Corporation 3. To establish a comprehensive investment structure from equity to senior debt, SBI Capital Solutions was formed on August 4, 2004 and a 3.1 billion yen mezzanine fund was established.

IT Fund Harvest Period 1 , 6 0 0 Current value of net assets and ( U n i t : 1 0 0 m i l l i o n y e n ) preceding-year payments/fees (1,298 + 201 = 1,499 b.) continues to be in 1 , 2 9 8 b . y e n balance with the original investment 1 , 4 0 0 Unrealized Profit of Stocks at Current Value (1,505 b.) Payment and fees in previous 1 6 8 Unrealized gain of fiscal year 1 , 2 0 0 stock at current value Est. fees 45 Book Value Net Assets + Mgt. fees 156 3 1 4 3 2 3 20.1 b. yen 1 , 0 0 0 Total 2 2 9 0 5 5 1 Cash+ cash 8 0 0 equivalents 2 5 1 2 0 9 2 2 0 1 , 5 0 5 2 2 7 Book value 6 0 0 net assets 8 2 6 4 0 0 6 7 6 6 5 2 6 4 6 6 3 1 Investment 5 7 9 balance 2 0 0 E*Trade Securities (172) (172) book value 0 9/30 to 2002/6 2002/12 2003/6 2003/12 2003/3 2004/6 current

Book Value Net Assets of IT Fund from September 30 to Present Book value net assets (Unit: yen) 1,130 Main gains and losses 1 , 0 0 0 Main gains and losses Book value net assets 892 Cash 5 5 1 Cash Cash: +41 b. yen Cash: +41 b. yen 1 4 1 Gain/loss cause Gain/loss cause ・ ・ Investment - -4.3 b. 4.3 b. Investment ・ ・ Stock sales 19.9 b. Stock sales 19.9 b. ・ ・ Gain on stock sale 26.4 b. Gain on stock sale 26.4 b. 5 0 0 ・ ・ Investment Management fees - Management fees -1 b. 1 b. balance Investment 7 5 1 Investment balance: 17.2 b. yen decrease Investment balance: 17.2 b. yen decrease balance 5 7 9 Gain/loss cause Gain/loss cause ・ ・ Investment 4.3 b. Investment 4.3 b. ・ ・ Stock sales - -19.9 b. 19.9 b. Stock sales ・ ・ Stock valuation loss - Stock valuation loss -3.1 b. 3.1 b. 0 ・ Reversal of valuation allowance 1.5 b. ・ Reversal of valuation allowance 1.5 b. 2004/3/31 2004/9/30 2004/3/31 2004/9/30

Rate of Stock Market Price Increase for Rate of Stock Market Price Increase for Investee Enterprises Listed from IT Fund Enterprises Listed from IT Fund Investee (Rate of price increase from the end of March 2003 to the closing Rate of price increase from the end of March 2003 to the closing ( (Unit: %) Unit: %) ( price on September 30, 2004) price on September 30, 2004) 4 0 ３ ０ ３ ０ 2 0 ▲７ ▲４ ▲７ ▲４ 0 T O P I X J A S D A Q I N D E X I n v e s t m e n t f r o m I T F u n d * Using the book balance for IT fund investment in each company (2 * Using the book balance for IT fund investment in each company (2004/9/30), each percent 004/9/30), each percent change is given a weighted average. For an enterprise listed during the interim, the percent ing the interim, the percent change is given a weighted average. For an enterprise listed dur change from the public issued price is calculated. change from the public issued price is calculated.

IPOs and M&As IPOs and M&As To Dec. 2003 From Jan. to Dec. 2004 20 57 Companies (38 foreign) (16 went public) Since Jan. 2004, the following 16 companies have either gone through an IPO or an M&A ough an IPO or an M&A Since Jan. 2004, the following 16 companies have either gone thr • 2004/2/2 • 2004/2/2 World Nichiei Frontier Securities Co., Ltd. World Nichiei Frontier Securities Co., Ltd. • 2004/7/1 • 2004/7/1 Amana Inc. Amana Inc. • 2004/2/27 Nexus Co., Ltd. 2004/2/27 Nexus Co., Ltd. • 2004/7/8 Netprice Ltd. 2004/7/8 Netprice Ltd. • • • 2004/3/3 IDU Co. • 2004/3/3 IDU Co. • 2004/7/15 Funai Zaisan Consultants Co., Ltd. • 2004/7/15 Funai Zaisan Consultants Co., Ltd. • 2004/3/26 Venture Revitalize Investment Inc. • 2004/3/26 Venture Revitalize Investment Inc. • 2004/7/29 Sosei Co., Ltd. • 2004/7/29 Sosei Co., Ltd. • 2004/4/15 WebPort Corporation (M&A) 2004/4/15 WebPort Corporation (M&A) • 2004/9/16 Nissin Servicer Co., Ltd. 2004/9/16 Nissin Servicer Co., Ltd. • • • 2004/5/27 Dip Corporation • 2004/5/27 Dip Corporation • 2004/10/1 Flex Firm Ltd. (M&A) • 2004/10/1 Flex Firm Ltd. (M&A) • 2004/6/4 Frameworx Inc. 2004/6/4 Frameworx Inc. • 2004/10/5 VeriTrans Inc. 2004/10/5 VeriTrans Inc. • • • 2004/6/18 Runsystem Inc. 2004/6/18 Runsystem Inc. • 2004/10/19 T.K. International Corporation 2004/10/19 T.K. International Corporation • • (M&A) (M&A) The companies below received listing approval The companies below received listing approval • • 2004/11/15 2004/11/15 expected listing: Elpeda Memory Inc. expected listing: Elpeda Memory Inc. • 2004/11/25 expected listing: Kawaden Corporation 2004/11/25 expected listing: Kawaden Corporation • • • Companies expecting an IPO undergo a five Companies expecting an IPO undergo a five- -stage investment evaluation based on examination meetings held w stage investment evaluation based on examination meetings held weekly. The top eekly. The top prospects are included here, but Softbank does not guarantee a p prospects are included here, but Softbank does not guarantee a prospective IPO company will go public. rospective IPO company will go public. • • The number of IPOs and M&As represent the ones that have already The number of IPOs and M&As represent the ones that have already been transacted. been transacted.