Kabu Reports Weak Q1 of Fiscal 2020, Net Income Drops 65.5%

All of the broker’s reported financial metrics fell year-over-year.

After recording a weak performance in its 2019 fiscal year, Kabu, a retail broker, has published its financial results for the first quarter of its 2020 fiscal year, ending March 30, 2020.

The first quarter of Kabu’s 2020 fiscal year spans from the 1st of April 2019 until the end of June this year. Taking a look at the results, it appears that the Japan-based broker has started off the year on the wrong foot, as every financial metric fell on a yearly comparison.

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Revenue and income fall YoY for Kabu

Kabu, a subsidiary of the Mitsubishi UFJ Financial Group, reported operating revenue of ¥4.87 billion. When weighing this against the first quarter of the 2019 fiscal year, which achieved operating revenue of ¥5.78 billion, it is lower by 15.6 percent.

Net operating income for Kabu was also down on a year-on-year comparison. Specifically, net operating income for the first quarter of the 2020 fiscal year fell by 21.5 percent, from ¥4.94 billion in Q1 of 2019, down to ¥3.87 billion in Q1 of 2020.

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Operating income fell substantially year-on-year. In the first quarter of 2020, the broker only achieved a figure of ¥813 million. This has fallen by 61.8 percent from the ¥2.13 billion reported in Q1 of 2019.

Like all of the other metrics before it, net income also dropped by 65.5 percent, declining from ¥1.54 billion in the first quarter of the 2019 fiscal year, down to ¥533 million in Q1 of the 2020 fiscal year.

In the statement, Kabu states the reason for the performance change as follows: “Investment activities of individual investors decreased, such as a decrease of 17.3% from ¥11,640.1 billion in the same period of the previous year to ¥962.5 billion in individual commissioned trading value of shares etc. per day in the stock market (TSE, certificate of identification) in the first quarter and due to the increase in system-related expenses, sales and profits are expected to fall as mentioned above.”

However, it is important to point out that the figures released today are only preliminary and are subject to change. Contrastly, the preliminary figures are being compared with the actual values of the first quarter of fiscal 2019.

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