Nomura Continues Solid Revenue Growth in Q2 of FY2020

However, the firm's wholesale division couldn't match the previous quarter's strong results.

After reporting a standout performance in the first quarter of its 2020 fiscal year, Nomura Holdings, Inc. has announced its consolidated financial results for the second quarter and first half of its 2020 fiscal year.

For context, Nomura’s 2020 fiscal year ends on March 31, 2020. Therefore, the second quarter is from July 1, 2019, until the end of September this year, whereas the first half is from April 1, 2019, until September 30, 2019.

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Net revenue for the second quarter of Nomura’s 2020 fiscal year was ¥383.4 billion ($3.5 billion). When measured against the previous quarter, which posted net revenue of ¥332 billion, it is higher by 15 percent. On a year-on-year comparison, Q2’s net revenue has grown by 36 percent.

Income before taxes reached ¥128.5 billion. This represents an uptick of 72 percent from the first quarter of the 2020 fiscal year. On an annual comparison, Q2 of 2020’s income before tax has grown by 275.1 times, according to the report.

For the first half of fiscal 2020, Nomura reported net revenue of ¥715.4 billion. Comparing this with H1 of fiscal 2019, it has risen by 29 percent.

Nomura Wholesale revenues fall QoQ

Taking a look at the performance of Nomura’s wholesale division, which comprises its Global Markets services, which offers research, sales, and trading of global securities, such as foreign exchange (forex) and Investment Banking, which offers capital raising and advisory services.

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During the second quarter of the Tokyo-headquartered firm’s 2020 fiscal year, the wholesale unit booked net revenue of ¥156.7 billion. Against the first quarter, net revenue has actually fallen by two percent. However, it has still increased by six percent on a yearly comparison.

For the division, income before taxes was ¥18.9 billion. Again this is down by five percent from the previous quarter. Nonetheless, it is still 3.8 times stronger than in the same period last year.

According to the report, in Global Markets, equities revenues increased quarter-on-quarter, thanks to solid trading in Japan and the Americas. However, fixed incomes revenues declined by six percent compared to the previous quarter, which reported solid revenues for the asset.

Commenting on the results, Nomura President and Group CEO Koji Nagai said: “Core business performance slowed amid US-China trade friction and heightened geopolitical risk which saw challenging market conditions continue.

“In Retail, total sales declined as investor sentiment worsened and we focused on rebuilding our retail sales structure by reassigning our sales staff and integrating branch offices.

“Wholesale booked lower Fixed Income revenues compared to a strong previous quarter, while Equities and Investment Banking delivered a robust performance…”

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