This Tuesday Rakuten Securities, the retail brokerage division of Japanese conglomerate Rakuten, released preliminary financial results for its most recent fiscal year.
The results themselves are slightly misleading. That’s because the broker changed its accounting policy last year and, as a result, the most recent fiscal ‘year,’ which ran from the beginning of April to the end of December, was only nine months long.
Thus, when Rakuten Securities wrote in its report that it had an operating revenue of 45.1 billion yen ($410 million) last year, compared to 55.9 billion yen ($510 million) in 2017, one might have the impression that Rakuten under-performed last year.
But, if we were to tack on another three months to last year then, assuming that Rakuten Securities averaged the same revenue for that period, the firm would actually have done better last year than it did in 2017, with operating revenues reaching 60.1 billion yen ($550 million).
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Rakuten Securities – a decline in profits but better nine months
Similarly, the broker reported a pre-tax net income of 19.6 billion yen ($180 million) in 2017. That was compared to 14.8 billion yen ($140 million) last year.
Again, however, if we assume that the broker would have averaged the same income it did for nine months, for an additional three months, then it would have made 19.7 billion yen ($181 million) in pre-tax income last year.
For post-tax income in the 2017 fiscal year, Rakuten Securities reported a figure of 13.1 billion yen ($120 million). In 2018, the equivalent figure was 10.2 billion yen ($93 million).
If, for one last time, we add again an additional three months to the 2018 fiscal year, assuming once more that the broker averaged the same level of income, then it would have managed to reach 13.6 billion yen ($124 million) in post-tax income.