Financial Results Briefing for Q2 FY2022
Key Message【Strategic management on payment terminal purchase leads to the increase of the number of active terminals which is our essential growth strategy】

May 13, 2022
GMO Financial Gate, Inc.
(Ticker:4051, TSE-G)

8th IR Presentation
https://gmo-fg.com/

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

Cautionary Note Regarding Presentation Materials

The content of these presentation materials is based on
generally recognized economic and social conditions, aswell as assumptions judged to reasonable by GMO
Financial Gate as of May 13, 2022
Note that presentation material content is subject tochange without prior notice in response to changes inthe business environment or other unforeseen
circumstances

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

2

Meeting agenda

1. Summary of financial Results for Q2 FY2022
2. Growth Strategy and Progress

3. Financial Highlights

4. Appendix

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3

1. Summary of financial Results for Q2 FY2022

Copyright (C) 1999 GMO Financial Gate, Inc.

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4

1.1

Q2 FY2022 Summary

Qualitative
comments

Quantitative comments

Even though, we observed negative impact of seasonality and COVID on Q2 standalone, we’vebeen keeping the trend of active terminal expansion as well as keeping solid progress inrevenue/profit Q2 cumulative basis towards our forecast
P６• Q2 FY2022 Cumulative
Progress towards full year forecast:- Revenue：¥4.47billion(＋58.7％ YoY) 52.3％- Operating Profit：¥0.37billion(＋16.3% YoY） 50.3％
P９• Revenue by business model Q2 Cumulative- Initial revenue：¥3.09billion(＋58.2％ YoY)
- Stock-model revenue：¥1.37billion(＋59.8％ YoY) ⇒expanding steadily• KPIs P16, P17- No. of active terminals：156.3K(＋63.2K YoY, 1.7x growth YoY)
- TRX volume：62.93 million(2.3x YoY), GMV：¥516.2 billion (2.2x growth YoY)
• Expanding industry variation of merchants and decreasing GMV % of top ranked merchants
P15- GMV of top 30 merchants out of total GMV in Q2 standalone⇒Q2 FY2021：30.1%→Q2 FY2022：22.5%(▲7.6 points)•

Stock-model revenue of Q2 standalone remain at the same level as Q1 standalone, despite the seasonality and COVID⇒In March, transaction volume and value exceeded December 2021, offsetting the slump in January and February•

Expansion of customer base due to progress in introduction to small-amount payments (mobility area, government
agencies, etc.)•

Regarding the purchase of payment terminals, we work closely with manufacturers to minimize the impact on FY2022
Copyright (C) 1999 GMO Financial Gate, Inc.

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5

1.2

Summary of Financial Results

Steady progress toward targets in both sales and profits at each stage. Although Q2 standalone
was negatively impacted by COVID, various KPIs steadily expanded YoY
Guidance
FY2020 1st half
（Full-year）

Progresstowards guidance＋58.7%

4,052（8,550)110.3%（52.3%)

1,210＋23.5%

1,130(2,421)

107.1%（50.0%)

319

371＋16.3%

359(737)

103.3%（50.3%)

212

234+10.6%

226(461)

103.6%（50.8%)Q2 FY2021
Cumulative

Q2 FY2022
Cumulative

Revenue

2,816

4,468

Gross profit

980

OperatingprofitProfit attributable toowners of parent（Millions of yen）

KPI
（YoY）

YoY

No. of active terminals

Transaction volume

Transaction value (GMV)（end of Q2）（Q2 standalone）（Q2 standalone）

156,303（1.7x YoY）

Approx. 62.93million（2.3x YoY）

Approx. ¥516.2billion（2.2x YoY）

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6

1.3

Major Topics Regarding Financial Results

In the first half of the previous fiscal year, the number of units sold was low due to the start-up of
stera, and sales increased nicely YoY（millions of yen）

5,000

◼ Revenue

Revenue（+58.7％ YoY）

4,500(＋) Steady growth in sales of payment terminals, particularly in stera(＋) Growth in stock-model revenue on the back of an increase in the number of active terminals(－) To shorten the operating hours of merchants by taking priority measures such as preventing
spreading COVID due to the Omicron epidemic

4,000◼ Gross profit
3,500

3,000

4,468

2,500

(＋) Sales expansion(－) Increase in the composition ratio of stera (low gross profit margin terminals)
in initial revenue(＋) Increase in the proportion of recurring revenue (relatively high gross profit
margin) to total revenue◼ Operating profit
2,000

1,500

2,816

Gross profit（+23.5％ YoY）

1,000

980

500

1,210

(＋) Appropriate cost management(±) Steady progress with full-year recruitment plan ofaround 15 employees(－) Investment within the profit plan

Operating profit（+16.3％ YoY）
319

371

0
Q2 FY2021
Q2 FY2022
売上高
cumulative
cumulative

Q2 FY2021
Q2 FY2022
売上総利益
cumulative cumulative

Q2 FY2021
Q2 FY2022
営業利益
cumulative cumulative
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7

1.4

Revenue forecast FY2022 (Quarterly)

Sales of stera began in the first half of the previous fiscal year, and sales increased significantlyin the first half of this fiscal year due to contributions from the beginning
Rvenue forecast
FY2022 full year（+20.6％ YoY ）8,550（millions of yen）

2,500

Rough image of revenue in
Q3, Q4 FY2022+52.0％ YoY (actual)

7,090+66.5％ YoY (actual)
2,000

1,500
2,327
2,142
2,252

1,000

2,021
1,286

1,531

Q1 standalone

Q2 standalone

500

0
Q3 standalone
FY2021Q4 standalone

FY2021

FY2022

FY2022
Copyright (C) 1999 GMO Financial Gate, Inc.

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8

1.5

Revenue by Business Model

Steady growth in recurring revenue due to accumulation of active terminals.
Significant contribution from increased fee sales（millions of yen）

Q2 FY2021
Cumulative

Q2 FY2021
Cumulative

%

%

YoY

Initial

1,959

69.6％

3,098

69.3％

+58.2％

Stock-model

858

30.4％

1,370

30.7％

+59.8%

Stock

282

10.0％

392

8.8％

+39.4％

Fee

201

7.1％

521

11.7％

+159.2％

Spread

375

13.3％

457

10.2％

+21.9％

Total

2,816

100.0％

4,468

100.0％+58.7％

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9

1.6

Revenue by Business Model (Quarterly)

Initial revenue in Q2 standalone were firm. Although stock-model revenue in Q2 standalone wasaffected by seasonality and COVID, successfully remained at the level as Q1 standalone
Initial revenue

Stock-model revenue（millions of yen）

（millions of yen）

Pre COVID

Under COVID

1,800

Pre COVID
800

1,682
1,525

1,600

1,643

1,454

+¥316 million(＋86.1%)

Spread

700

687

683

186

206

Fee

1,400

600

1,200

569
Stock

1,103

495

500
430

1,000

855

800
626
600

Under COVID

400

363

333

693
300
451

110

391

367

136

128

465

400

200

200

100

75

160

132

118

80

70

182

427

262

146

259

183
101

99

193

182

149

80

0
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
FY2020 FY2020 FY2020 FY2020 FY2021 FY2021 FY2021 FY2021 FY2022 FY2022

State of Emergency①

Apr 7～ May25

②

③

④

Prevention of spreading
COVID

Jul 12～Sep 30 Jan 7～Mar 21
Jan 7～Mar 21
Apr 23～Jun 21

178

180

125

179

186

203

239

218

0
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
FY2020 FY2020 FY2020 FY2020 FY2021 FY2021 FY2021 FY2021 FY2022 FY2022
State of Emergency①

Apr 7～ May25

②

③

④

Prevention of spreading
COVID

Jul 12～Sep 30 Jan 7～Mar 21
Jan 7～Mar 21
Apr 23～Jun 21

Copyright (C) 1999 GMO Financial Gate, Inc.

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10

1.7

Initial revenue and No. of active terminals (Quarterly)

Initial revenue remained firmly QoQ. The number of active terminals accumulated QoQ steadily,
despite the impact of the time lag between the termimals sales and its activation especially in IoT
domain
+13.1
156.3
+18.3
+17.8

Initial（Units: millions of yen）

124.9

No. of active terminals （Unit: thousands）

+14.1

143.2

107.1

+12.3
+8.0
+5.3
+9.8
+10.6

67.4

93
80.7

72.7

1,643

57.6
47
1,103

1,525

1,682

1,454

855
626

693
451

465

2020/9期 1Q

2020/9期 2Q

2020/9期 3Q

2020/9期 4Q

2021/9期 1Q

2021/9期 2Q

2021/9期 3Q

2021/9期 4Q

2022/9期 1Q

2022/9期 2Q

Q1 FY2020

Q2 FY2020

Q3 FY2020

Q4 FY2020

Q1 FY2021

Q2 FY2021

Q3 FY2021

Q4 FY2021

Q1 FY2022

Q2 FY2022

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11

1.8

Merchant Industry

Preparing steadily for the recovery in domestic consumption and inbound demand in the postCOVID-19 economy. Acquire a well-balanced member merchant base across industries：High inbound tourism demand
COVID-19 headwind
COVID-19 tailwind
NeutralStore scale：Large
Chainrestaurant

One dollar
shop
Publictransportation(Train/bus etc.)

Hotel/Travel

Supermarket
Drug store(medicine/cosmetics)

clothing/
Sporting
goods

Parking lot

Action Plan

High-end
retail/Department
store

IoT

New

mobility

Administrative
institutions(City office /Police station/
Drivers’ license agency)

Low unit
price

IoT
Vending/
checkoutmachinestera pack
(For SMEs)

•
•

•
•

Introduction of self-checkout
registers
IoT POS / Center linkage••

POS point linkage
Provision of DX services tobusiness partners

Solutions for the mass market
Provision of DX services tobusiness partners•

Sales strategies by industry/
individual company
Proposals in collaboration withbusiness partners•

Independent
restaurant/
Small retailComprehensive proposals
with alliance partners
High unit
price
GMO Card System(consolidated subsidiary)

Service/
Leisure(Incl: fine dining)

Medical / Clinic

Store scale : Small
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12

1.9

Transaction Trends by Industry (Q2 standalone)

In Q2, some merchants were affected by seasonality and COVID. After the lifting of the prevention
system at the end of March, there has been a recovery trend toward the pre-COVID level byindustrial category

0,000

Merchant Ａ

Merchant C
Seasonality
90,000&2,500,000,000
80,000Preventionofspreading COVID
70,000Super market
2,000,000,000
60,000COVID 19 headwind

0,000

Chain
restaurant

0,000

TRX Volume
TRX Value (GMV)

0,000

TRX Value (GMV)

400,0040,0000,000

300,001,000,000,000
30,000

0,000
2021～

2022～

200,0020,000500,000,000
10,000 2021～

0
Feb Mar Apr May Jun

Jul

Aug

Sep

Oct

Merchant B

Nov DecJan

Feb Mar0
Jan

Feb Mar Apr May Jun

Seasonality
Drug store&
3.5E+09
TRX Volume
Prevention ofHotel/Travel
70,000 Pharmacy
spreading COVID3E+09
TRX Value (GMV)(Medicine/
60,000 Cosmetics)
2.5E+0950,000
Oct-Dec：Domestic demand：High inbound tourism demand
2E+09
Mar： 40,000
Easing of1.5E+09
entry
limitation from30,000Jul-Aug：In-Bound demand
overseas
1E+09
20,000spiked because of the spot
factor caused by international
500000000
10,000
2021～
2022～
2021～
event held in Japan0
0
Jan Feb Mar
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

0,000

0,000

0,000

0,000

0,000

0,000
0

Jul

Aug Sep

Oct Nov Dec

COVID 19 tailwinds

Merchant DJan

Feb Mar：High inboundtourism demand

TRX Volume

COVID 19 headwind

0,000

100,00

2022～

0 0
Jan

0,000

Though slightly
600,00impacted byseasonality, stayedsolid range
500,00TRX Volume

50,0001,500,000,000

0,000

0,000

COVID 19 tailwind

12

TRX Value (GMV)
stayed solid range

10

80

60

40

20

2022～
0
Apr

May

Jun

Jul

Aug

Sep

Copyright (C) 1999 GMO Financial Gate, Inc.

Oct

Nov

Dec

Jan

All Right Reserved.

Feb

13

Mar

1.10

Top ranked merchants (GMV basis)

In addition to acquiring new merchants, thanks to the GMV coming from existing merchants
also increased, our cashless platform expanded nicely◼ Top 30 TRX Value (GMV)
Q2 standalone FY2021
Retailer A
Drug sotre A
Drug store B
Super market A
Service A
High ASP retailer A
Medical/Clinic A
High ASP retailer B
High ASP retailer C
Retailers B
Service B
Super market B
High ASP retailer D
Service C
Retailers C
High ASP retailer E
Chain restraurant A
Service D
Low ASP retailer A
Service E
Service F
Hotel/Travel A
Medical/Clinic B
Medical/Clinic C
Medical/Clinic D
Medical/Clinic E
Medical/Clinic F
Home-meal replacement A
Drug store C
Service G

Q2 standalone FY2022
Supermarket
market C
Super
C
Drug store A
Retailer A
Low ASP retailer A
Apparel AA
ApparelDrug store B
High ASP retailer A
Super market A
Medical/Clinic A
Supermarket
market D
Super
DHigh ASP retailer B
Chain restaurant A
Service A
Hotel/Travel B
Drug store D
Super market B
Supermarket
market EE
Super
High ASP retailer F
High ASP retailer C
Super
Supermarket
market FF
High ASP retailer D
High ASP retailer G
Retailer B
ApparelB
Apparel B
Service
H
Service H
Hotel/Travel C
High ASP retailers E
Service C
Service D
Retailer C

New

*

*

Subtotal of top 30 GMV¥71.0billion

New
Net increase vs FY2021
Net decrease vs FY2022

New

Subtotal of top 30 GMV
Rank-in (unranked FY2021)
Rank-in (unranked FY2021)

*
*

New
Rank-in (unranked FY2021)

*
*

20

40

60

80

100

120
（Units：100 million yen ）(+¥45.3billion YoY、+64.0% YoY)

• 12 merchants newly ranked in top 30

New-New contract：7

Rank-in (unranked FY2021)-Unranked →Ranked in：5

New
New
Rank-in (unranked FY2021)*

0¥116.3billion*Increased significantly because these are the comparison
with the star-up time of starting payment terminal delivery
0

20

40

60

80

100

Copyright (C) 1999 GMO Financial Gate, Inc.

120

（Units：100 million yen ）All Right Reserved.

14

1.11

Percentage of top 30 merchants out of total GMV(Q2 standalone)

As the base of merchants expands, the GMV composition ratio of the top 30 merchants
declines and industry diversification progresses. Observed strong growth at supermarkets andachieved well-balanced portfolio even under COVID stuation◼ Q2 standalone (Jan-Mar) FY2021◼ Q2 standalone (Jan-Mar) FY2022

Percentage of top 30 merchants out of total GMV
Total GMV in Q2 standalone：¥23.61 billion
Top 30 GMV in Q2 standalone ： ¥71.0 billion

Total GMV in Q2 standalone
Top 30 GMV in Q2 standalone： ¥51.62 billion (+118.6% YoY)
： ¥11.63 billion (+64.0% YoY)
12.0%

18.3%

18.6%
25.3%

22.5%

30.1%

上位10社
Top10

上位20社
Top20

上位30社
Top30

その他
rest

上位10社
Top10

上位20社
Top20

上位30社
Top30

その他
rest

Percentage of top 30 merchants by indusrial composition (GMV basis)
1.8%
2.1%

1.5%

1.3%

4.6%

25.7%

6.8%

12.6%

3.3%

5.1%

19.3%

9.0%

4.0%

18.1%

7.9%

16.6%

18.1%

9.5%
14.9%

17.7%
High
ASP retailer
高単価小売りDrugstore
ドラッグストア

Service
サービス

小売り
Retailer

医療/クリニック
Medical/ClinicSupermarket
スーパー

チェーン飲食Chain restaurant

低単価小売りLow
ASP retailer

Hotel/Travel
ホテル/旅行

中食チェーン
Home-meal
replacementSupermarketスーパーHigh ASP retailer
高単価小売りDrug store
ドラッグストア

Retailer
小売り

サービス
Service

Apparel
アパレル

Low
ASP retailer
低単価小売りHotel/Travel
ホテル/旅行

Medical/Clinic
医療/クリニックChain
restaurant
チェーン飲食Copyright (C) 1999 GMO Financial Gate, Inc.

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15

1.12

Consolidated KPIs（No. of Active Terminals）

Growth in payment terminals (excluding IoT) is driving growth. IoT tends to fluctuate QoQ due tothe time lag of sales → activation. Decreased share of alliance partner sales
180

Total active terminals： ＋63.2K Units YoY 、+67.9% YoY（Unit：Thousand）

By terminal type
YoY

QoQ
160

＋13.1

Payment terminal (excluding IoT)

143.2

140

IoT

124.9

100

93.1
80.7

80

72.7
67.3

47.1

8.5
14.1

13.6

42.3

16.7

(+6.0%)

20

24.4

26.5

27.7

Q1 FY2020

Q2 FY2020

Q3 FY2020

Q4 FY2020(＋39.8%)

30.9

Payment terminall

28.0

30.3

83.0

36.7

＋12.3K

33.6

29.1
26.1

＋0.9

39.8

16.7

14.9

14.4

9.6
21.5

+1.0K

43.2

16.4

57.6

17.7

17.9

107.2

Alliance partner sales

60

Alliance partner sales

IoT

120

40

▲0.2

156.3

45.4

56.8

＋12.4 95.4

(excluding IoT)

＋50.0K(＋110.1%)

68.7

0Q1 FY2021

Q2 FY2021

Q3 FY2021

Q4 FY2021

Q1 FY2022

Copyright (C) 1999 GMO Financial Gate, Inc.

Q2 FY2022

All Right Reserved.

16

1.13

Consolidated KPIs (Quarterly TRX volume/GMV)

Developing merchants and active terminals without bias in any industry, significantly exceeding
our target of YoY+50%◼ Transaction Volume◼ Transaction Value (GMV)（Units: millions）（Units：¥100 million）

70

6,000

60

(－)Prevention of
spreading COVID＋(－)Seasonality

50

40

5,000

(－)Prevention of
spreading COVID＋(－)Seasonality

4,000

3,000

30

2.3x YoY

20

Seasonality

Q2
FY2020Q3
FY2020Q4
FY2020Q1
FY2021Q2
FY20212.2x YoY
Seasonality

10
Q1
FY2020

1st State of Emergency

2,000

Q3
FY2021Q4
FY2021Q1
FY20221,000

Q2
FY2022

Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
FY2020 FY2020 FY2020 FY2020 FY2021 FY2021 FY2021 FY2021 FY2022 FY2022

Q1 FY2020

Q2 FY2020

Q3 FY2020

Q4 FY2020

Q1 FY2021

Q2 FY2021

Q3 FY2021

Q4 FY2021

Q1 FY2022

Q2 FY2022

Transaction volume（Unit: 10 K）

1,383

1,494

1,809

2,231

2,683

2,774

3,848

4,914

6,497

6,293

GMV（Unit: ¥100 million）

1,442

1,534

1,307

1,833

2,329

2,361

3,141

3,810

5,251

5,162

※Although active terminals increased steadily by selling payment terminals, KPIs above slightly decreased due toseasonality and Prevention of spreading COVID
Copyright (C) 1999 GMO Financial Gate, Inc.

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17

1.14

Comparison with Market Growth

In response to the trend of YoY+10% in each industry, we maintain a level of doubling. Decline in
GMV in January and February was also within expectations
Left axis ：GMV YoY

GMO-FG

ALL

Other retailers

Restaurants

Hotels/Inn

Right axis：GMO-FG Monthly GMV（Unit：%）

2,500
260

SOE
（1st）
216

215

100

193

186

160

153

111

108
110

113

113

234

192

202

203

202
183

99
84

82

97 91

2,000

102

214

202

222

190
173

1,500
143
111 111 106

101
98

207

176

140

97

226

215

148

96

238

229

216

211

186

200

SOE（2nd）・Seasonality

91

93
110

130

107

124

1,000

109

113

116

117

112

0

500

Dec
Jan 21/02
Oct 19/11
Nov 19/12
Dec 20/01
Jan 20/02
Feb 20/03
Mar 20/04
Apr 20/05
May 20/06
Jun 20/07
Jul 20/08
Aug 20/09
Sep 20/10
Oct 20/11
Nov 20/12
Feb 21/03
Mar 21/04
Apr 21/05
May 21/06
Jun 21/07
Jul 21/08
Aug 21/09
Sep 21/10
Oct 21/11
Nov 21/12
Dec 22/01
Jan 22/02
Feb 22/03
Mar
Oct21/01
19/10
SOE①

②

③

④

Apr 7～May 25

Jan 7～Mar 21

Apr 23～Jun 21

Jul 12～Sep 30

Prevention of
spreading COVID
Jan 7～Mar 21

Source: Ministry of Economy, Trade and Industry

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

18

0

億

（Unit：¥100 million）

300

２. Growth Strategy and Progress

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

19

2.1

Progress of action plans for OP growth

Strategy to increase market share, starting with sales of payment terminals, is making steadyprogress towards the target. Various measures are making steady progress, and several midto long-term growth strategies are under consideration
FY2021

FY2022*Actual*ForecastOP¥0.59 billion¥0.74 billion

GMV¥1.2 trillion¥1.8 trillion

2024

2025

around 2035

Over ¥1 billion¥1.5 billion¥10 billion

Target¥5 trillion¥30 trillion◼ Mid- to long-term growth strategy (2026~)◼ Growth strategies and progress（~2025）① Acquire multi-industry/high-growth enterprises by launching next-generation multi-

1 payment terminals⚫ A920, which is next generation model, started to be activated.
⚫ Started to operate in administrative agencies to expand our platform beyond private sector.
⚫ Other new type of next generation payment terminals are under consideration.

①

Maintain a growth curve of 25% ormore by diversifying alliance strategies(payment methods, additional
functions, customer acquisition routes)②

Expand stock-model revenue by
providing FinTech/money services③

Expand profit points through the use of
IoT data

2① Expand IoT payments by supporting contactless (tap) and unattended payments⚫ Terminal sales made good result even though affected by seasonality and COVID at a certain level⚫ Started cashless payment support at several smart stores (began “Proof of Content” tests) where noman is attended at register.
⚫ Delivering terminals to a major parking clearing machine vendor and our terminals are going to operatein shopping centers.
⚫ Mobility business domain is expanding steadily.
⚫ In addition to “Tap to phone”, we are also planning to deliver new type of terminals such as A35.

3① Acquire large accounts through expansion of alliances with QR, points, etc.
⚫ Planning to support point payment development of railway company⚫ Steady Expansion of QR Settlement for Comprehensive Contracts in the IoT Domain (Vending
Machines for Goods area).

4① Increase added value by strengthening processing center functions⚫ Ongoing preparation forcontinued growth⚫ Started providing an improved version of the transaction data sharing service as planned.
⚫ Functional sophistication of back office (bill settlement operations, etc.) completed.
⇒Started providing DX services to merchants (making billing operations web-based).
⚫ Supporting merchants' finances by starting to provide early payment services.
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

20

Action plan： 1

2.2

2

3

4

Payment terminals(excluding IoT)-Progress status

The sales momentum of payment terminals continues, and the number of active terminals
continues to expand. Accumulate forecasts without bias toward merchants’ industry and size
◼ No. of active terminals * Payment terminals (excluding IoT)
（単位：千台）End of Q4（Unit:Thousand）

FY2020

Payment
terminals

End of Q1

End of Q2

End of Q3

End of Q4

End of Q1

End of Q2

QoQ

YoY

FY2021

FY2021

FY2021

FY2021

FY2022

FY2022

(%)

(%)

36.7

45.4

56.8

68.7

83.0

95.4

Launched stera

30.3(excluding IoT)

+6.4

+8.7

+11.4

+11.8

+14.4

+12.4

+50.0

(+15.0％)(+110.0%)+12.4◼ Major sales forecast in FY2022
Acquiring major merchants in each industries, and accumulating 1K toseveral thousands of sales forecast in each major merchant

Shopping centerHomeappliances

Drug store/
Pharmacy

DIY Home
centerFast foodApparelBook store

Copyright (C) 1999 GMO Financial Gate, Inc.

Rental car

All Right Reserved.

21

Action plan： 1

2.3

2

3

4

Expansion to small-amount payment merchants

The cashless payment system in small-amount payment field in public institutions has also
progressed, and the scene of our platform provide has expanded

Small amount payment

Police station/
Drivers’ license center

Small amount payment(Tokyo)City office hall

Enable to pay various fee bycashless method

Delivering across Japan

Small amount payment

Mobility domain

Store-type of merchants

Visa NFC touch payment in thescenes such as train/bus

Has been delivering to
the merchants withoutbias in industry and size
In addition to traditional type of register, we arealso promoting to provide cashless solutions with

Small amount payment

・Self-checkout register at ¥100 shop
・Mobile catering in stadium

Our cashless platform is expanding
by delivering cashless services in small amountpayment field

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

22

Action plan：

2.4

1

2

3

4

IoT-Progress status

Sales of IoT devices remained steady. Steadily accumulated the number of active terminals QoQ,
despite the impact of the time lag between the terminal sales and activation◼ No. of active terminals * Payment terminals (IoT)（単位：千台）End of Q4

End of Q1

End of Q2

End of Q3

End of Q4

End of Q1

End of Q2

QoQ

FY2020

FY2021

FY2021

FY2021

FY2021

FY2022

FY2022

(%)

29.1

30.9

33.6

39.8

（Unit:Thousand）

IoT◼ IoT use-case+1.8

Self-checkout registers
at hotels/retailers

+2.7

+6.2

42.3

+2.5
Metered parking
clearing machines

43.2

+0.9

+12.3

(+2.1％)(+39.8%)+0.9
Vending machines(Frozen･Chilled food)Japanese ramen noodle, dumpling, chilled
meat, Seafood, Japanese/Foreign sweets,
beef rice bowl, various meal dishes etc…
Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.
23

Action plan： 1

2.5

2

3

4

Progress of IoT Payment BusinessStarted introduction to new vending machine vendors and parking lot settlement machine
vendors. Steady expansion of the scene offered, contributing to initial and recurring revenue inthe future
2022

2021

StatusIn Progress

Oct

To be launched

Hotel/Golf courses

Flow

Dec

Mar

Delivered approximately
40,000 payment terminals

Jun

Sep

New Topic

Replace existing terminal

Gradual launch of comprehensive
business in the hotel area and steady
accumulation of new projects.
Contribution to spread revenue withhotel operation

Fee revenue from active terminals

Stock
Parking lot
Checkout machines

Flow
Stock

Ticket Machines

Flow
Stock

Self-checkout registers

Flow

Expanding to comprehensive business*No change fromprevious status

Began installing
Started delivering to new major parking
terminals at major
check out machine manufactureparking lot operators
Stock, fee, and spread revenue from active terminals

Completion of development of QR
code settlement. Can horizontallydeploy in-house assets and know-how
to multiple payment machine
manufacturers

DX
DX: Digitalize parking tickets, plan to integrate online reservation and payment
Demand increases due to new lifestyles under COVID
Completed certification process of all e-money
Expand of stock-model revenue
brands, increasing stock-model revenue
Expand to QR code payment*No change fromprevious status

Implemented PoC test at several smart storesStarted demonstration tests ofcashless solutions in smart stores

Stock
Goods & Beverage vending
machines/coffee machines

Flow
Stock

QR-Code payments, which werescheduled to be rolled out in the
FY9/22 1Q, will be rolled out in 2Q
and beyond. Strive for early catchup.

New Topic

To be operated fully

Started delivering to new vending machine manufacture

New Topic*No change fromprevious status

Started operation of terminals for beverage vending
machines on expressway SA
Began installation of QR settlement for beveragevending machines

Copyright (C) 1999 GMO Financial Gate, Inc.

New Topic
Began introduction of payment
terminals to beverage vending
machines on expressway SA.
Introduction of QR settlement also
started.

All Right Reserved.

24

3. Financial Highlights

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

25

3.1

Profit & Loss

Gross profit grew at a low level compared to revenue due to a higher percentage of sales fromstera terminal, which have a higher cost, compared to Q2 previous fiscal year. SG&A-to-sales ratio
declined due to cost management(Unit: Thousand)

Q2 FY2021
Cumulative（actual）

Q2 FY2022
Cumulative（actual）

YoY

Revenue

2,816,315

4,468,335+58.7%

COGS

1,836,706

3,258,241+77.4%

Gross profit

979,608

1,210,093+23.5%

SG&A

660,695

839,141+27.0%

Operating profit

318,912370,952+16.3%

Ordinary profit

319,549

370,591+16.0%

Profit attributable to ownersof parent

211,636

234,115+10.6%

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

26

3.2

Revenue by business model (YoY)

Steady increase in the number of active terminals and steady expansion of recurring revenue dueto the progress in developing merchants with stable payment volumes even under pandemics
such as COVID（Unit : millions of yen）
Initial

Stock

Fee

Stock-model revenue
1,370

SpreadStock-model revenue+59.8％ YoY

Stok-model revenue
857
%

375

13.3%

201
282

7.1%
10.0%

69.6%

1,959

Q2 FY2021
Cumulative

%

457

10.2%

521

11.7%

392

8.8%

3,098

69.3%

Initial revenue+58.2％ YoY

Q2 FY2022
Cumulative
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

27

3.3

Revenue by business model (Quarterly)

Although Q2 standalone was negatively affected by seasonality and the prevention of spreading
COVID, recurring revenue remains at the same level as Q1 FY2022 standalone（millions of yen）

Initial

SOE①

②

③

④

4/7~5/25

1/7~3/21

4/23~6/21

7/12~9/30

Q1 FY2020 Q2 FY2020 Q3 FY2020 Q4 FY2020 Q1 FY2021 Q2 FY2021 Q3 FY2021 Q4 FY2021
standalone standalone standalone standalone standalone standalone standalone standalone

626

693

451

Recorded advances
terminal sales

465

Q1 FY2022
standalone

Q2 FY2022
standalone

855

1,103

1,525

1,682

1,455

1,643

Launched stera

Stock-model

363

367

333

391

430

427

495

569

687

683

Stock

110

118

128

132

136

146

160

182

186

206

Fee

75

70

80

80

101

99

149

183

262

259

Spread

178

180

125

179

193

182

186

203

239

218

1st State of Emergency

Total

990

1,061

784

856

1,286

1,531

2,020

2,252

Copyright (C) 1999 GMO Financial Gate, Inc.

Seasonality &
COVID
2,141
2,327

All Right Reserved.

28

3.4

Balance Sheet

Continuing from the end of 1Q, the inventory of payment terminals is secured at a safe level inlight of the status of supplies
End of Q2 FY2022（Thousands of yen）
Cash & Cash equivalents(24.5%)

1,618,341◼ Comments
Current liabilities

2,135,303
Non-current liabiliries

33,229Commodities (Payment terminal)

2,523,448• Increased commodities (＋¥350
million) from the end of Q1 FY2022• the inventory of payment terminals is
secured at a safe level in light of thestatus of supplies

Total equity(73.2%)
Other current assets

4,424,624

1,006,813
Non-current assets

1,444,554
Asset

Liabilities
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

29

3.5

Consolidated KPIs（No. of Active Terminals）

Payment terminals (excluding IoT) drove growth. Steadily accumulated IoT in QoQ despite theimpact of the time-lag between the sales and activations(Unit:FY2020

FY2020

FY2021

FY2021

FY2021

FY2021

FY2022

FY2022

QoQ

YoY

Thousand)

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

(%)

(%)

Payment
terminal(excludin
g IoT)

27.7

30.3

36.7

45.4

56.8

68.7

83.0

95.4

+12.4

+50.0

(+15.0％)(+110.0％)

IoT

26.1

28.0

29.1

30.9

33.6

39.8

42.3

43.2

+0.9

+12.3

(+2.0％)(+39.7%)

Alliance
partner
sales

13.6

14.4

14.9

16.7

16.7

16.4

17.9

17.7

- 0.2

+1.0

(- 0.9％)(+5.7%)

Total

67.3

72.7

80.7

93.1

107.2

124.9

143.2

156.3

+13.1

+63.2

(+9.2％)(+67.9%)Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

30

4. Appendix

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

31

Business Model

GMO-FG Business Domain
GMO-FG is focusing on offline payment（リアル店舗決済 ＋ IoT決済）

Company nameBusiness
Domain

GMO Financial Gate
(Payment at Brick & Mortar + IoT)

GMO Payment Gateway(EC)

Payment by passing card/QR code over
the reader

Payment by entering credit card
information in PC / mobile phone

Payment
methodMediumEC (terminal is unnecessary)

Payment terminal• Physical hardware network• Proprietary programming code specifications• Regulation

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

32

Business Model

Rev Models: Financial Gate vs. Payment Gateway
Initial revenue in offline payment is tend to be fluctuate because of its seasonality of terminal
delivery

PG

FG
Revenue

Revenue

N

N+1

N+2

N+3

N+4

Time

Time
N

N+1

N+2

N+3

N+4

Initial Revenue（Terminal Sales・Software Development）

Initial Revenue（Initial Set up Fee, etc…）

Stock, Fee, Spread Revenue

Stock, Fee, Spread Revenue

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

33

Business Model

Three Biz Models Over a Single, One-Stop Platform
One-stop platform covering all settlement processes between merchants and acquirers
Consumer

Merchants

FG

Various
Payment
Methods

Terminals

1
Payment
Terminal

Various Payment
Methods

Acquirers

Terminal Sales
Business

Credit Card
IssuerFlow Revenue

Bank

Payment
Terminals

Payment
Scene

RetailRestaurants

Service

Mobilityetc

2
Payment
Processing

Metered Parking
EV Meter
etc

E-Money Vendors

Points Vendors

Vending Machines/
Coffee Machines
Checkout Machines(Country Club/
Hotel)

Payment
Processing

Stock Revenue

IoT

Purchase

Payment Processing
Business

3
Comprehensive
Clearing

Acquiring
Business

Clearing

QR CodePayment
Vendors

Stock Revenue

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

34

Business Model

Stock Revenue Expansion Originating From Terminal Sales
Stock revenue grows with flow model revenue which is mainly coming form the sales of payment
terminals%

Revenue Model

3 Business

4 Types of Revenue

Flow Model Rev① Terminal Sales
Business

Initial

69.3％

Stock

8.8％

Fee

11.7％

Spread10.2％(Q2 FY2022 cumulative)② Payment
Processing
Business

Stock Model Rev③ Acquiring
Business

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

35

Business Model

Players in offline cashless payment setting
Sales activity to merchants/Clearing of merchant transaction
offlinePayment Processing
CenterMerchants

Offline market
POS vendor

Terminal manufacturer
Domestic makerOverseas maker

Processing center (CCT)

Payment
Network

Domestic network

Acquirer

International network

Card company
Bank etc

Legacy POS
Mobile POS

Vending machine manufacturers /Self checkout register manufacturers

Financial
Institutions

Payment Brand
ASP center (POS)
E-money center

Code payment gateway

Int’l card brandE-money
Domestic code payment
Foreign code payment

Acquiring Partner
Mobile POS

Our monetization points
Initial Revenue
Stock Revenue※Activation of payment terminals～Connect to our processing center

Alliance partner

Fee Revenue※Booked in stock revenue occasionally depending on contract type※Excluding roll paper sales
Copyright (C) 1999 GMO Financial Gate, Inc.

Spread Revenue
All Right Reserved.

36

Business Model

Image of rise in Rev & OP
Phase1: Focus on sales/activation of payment terminals and revenue will be fluctuated.
Phase2: Expansion of Stock-Model revenue
Phase 1

Phase 2

Increase of Market Share (approx. up to 2025)

Revenue: Increase at a CAGR of 25% or more, although the extent of increase willvary from period to period

16,00014,000Rise in Profit Margin

RevenueOP

12,00010,000

Sales may fluctuate significantly fromperiod to period

8,000

6,000

Operating income: Continue to grow 25% or more
every fiscal year

4,000

2,000

0

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

37

Business Model

Leveraged Growth Model
Fee and spread revenue are expanding with the market /growth in membership merchants

Leveraged Growth
N＋1
Stock revenue

N
Stock revenue

Stock-Model Revenue
SpreadLinking with the growth of
TAM / membership merchants

Fee
Stock revenue
before N-1

Stock
Q1
1Q

Q2
2Q

Q3
3Q

N期

Q4
4Q

Q1
1Q

Q2
2Q

Q3
3Q

N+1期

Q4
4Q

Q1
1Q

Q2
2Q

Q3
3Q

Linking with the number ofaffiliated merchants

Q4
4Q

N+2期

N-1期（ストック）
Stock

Fee
N-1期（フィー）SpreadN-1期（スプレッド）

N期（ストック）
Stock

Fee
N期（フィー）

SpreadN期（スプレッド）Stock
N+1期（ストック）

Fee
N+1期（フィー）SpreadN+1期（スプレッド）
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

38

Business Model

Details on each revenue ①
InitialContent

Payment
terminal sales

This is a sales revenue of payment terminals from merchants or credit cardcompanies.
All of first, we purchase hardware from manufactures. And confirm certain
measures of payment methods that each merchant needs to accept. Then
make these methods to connect to our processing center（Occasionally, we
put some customization to these terminals)

Softwaredevelopment

It is a type of development that meets customers needs such as widening
acceptable payment measures and adding point-payment functionality

Stock

Rev Model

Content✓ Since software development is tailor
made type revenue, deal size and margin
vary from time to time

Rev Model

It is a service that provides merchants with their daily sales data that go
through our processing center. We charge it as monthly fixed fee

Points＆QR

It is a service to add point/QR payment app to the terminals merchants have.
We charge it as monthly fixed fee• No. of contracts × Service Price

Rental(Mobileterminal)

It is a service to rent mobile type terminals that enable merchants to usethem in wireless setting. We charge it as monthly fixed fee

Mobile SIM

It is a SIM card fee to use mobile type terminals. We charge it as monthly
fixed fee(Monthly fixed fee
model)✓ There’re around 10 types of terminals✓ Price range is from about ¥20K up to¥100K• No. of Deals × Ordered value

Data sharing

Processing• Terminal Selling Price × Units Sold

✓ Service price is around ¥500 to ¥1K
per terminal per month• No. of contracts × Monthly FixedFee

It is a processing fee based on monthly fixed rate
*Basically, it is defined as “Fee” revenue when it comes to the case we charge as Pay As You Go billing, not fixed rate

✓ Monthly fixed fee will vary depending on
the size of contract etc..

Generally, the economics of services above vary depend on merchants. And there are services that some merchants do not apply
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

39

Business Model

Details on each revenue ②
Fee

Content

Processing

It is a fee we charge toward monthly transaction volume based on the rate pertransaction

Sales ofroll paper

This is a sales of roll paper that is used with payment terminals at stores

SpreadAcquiring（Settlement
agent）

Rev Model• TRX Volume× Processing Fee✓ Processing fee is about ¥2 to ¥3 pertransaction• No. of Order × Price of Roll Paper

content✓ The price range of roll paper is about¥130 to ¥200.

Rev Model

We charge spread fee (α) towards clearing amount tomerchants
We received indicator rate (N) from acquirers, then we acquire
merchants instead of acquirers with the new rate (N+α＝merchant fee)

GMV of Agent Contract
×
Spread fee we charge (about 0.3～0.4%)

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

40

Business Model

Relationship Between Spread Revenue and GMV
We do not necessarily generate spread revenue for every transaction. This is due to the fact thatcredit card companies have historically acquired major participating merchants on their own.
Therefore, we calculate spread revenue as GMV × Take Rate × Contribution Ratio◼ Direct Contract

Enjoyable Revenue
Payment Processing

Payment Processing

InitialMerchant Fee

Stock

Clearing

Fee

Merchant

Acquirer◼ Agent Contract（*Clearing amount for Agent Contract ÷ GMV＝Contribution Ratio）
Payment Processing

Spread Revenue (B)Payment Processing

InitialStock

Remittance (A-B)

Clearing Amount (A)Fee

Merchant Fee

Merchant（In cases where participating merchants pay
membership fee to acquirers directly）

SpreadAcquirer

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

41

Business Model

Relationship between number of active terminals & stock rev.
In addition to the increase in the number of active terminals, revenue opportunities for Stockrevenue will increase, but the status of subscriptions to paid services will differ depending on
the needs/demand of merchants
Merchants（Acquisition opportunity image of Stock revenue）

Terminals we offer

Stock Revenue
Non-Stock Revenue
Floor-Standing Model

Mobile Modelmerchant B
merchant A

Embedded Model

POS Model

merchant C

The status of subscriptions to paid
services that contribute to Stockrevenue varies depending on the typeof merchants and terminals.

merchant D

merchant F
merchant E
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

42

Business Model

Monetization by Payment Method
We operate different business models according to payment method as a cashless platformer.
Growth in each payment method contributes to our growth as well
Flow model revenue① Initial

Stock model revenue➁ Stock③ Fee④ Spread

Credit・China Union Pay・J-debit

E-moneyー

QR code

ー

Point

ー

ー

House point・House E-money

ーー

Duty exemptionーー

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

43

Business Model

Revenue Model by Merchant Size
We mainly acquire medium- to large-sized merchants through alliances with major financial
institutions. We mainly acquire small merchants (=long tail segment) through our subsidiaries◼ Four types of revenue model① Initial

Terminal sales, Softwaredevelopment, Initial
registration fee, etc…

➁ Stock

Monthly recurring revenue,
communication fee of terminals,
etc…

③ Fee

Processing revenue related to
TRX volume, Receipt paper
sales, etc…

④ Spread

Commission fee based on TRX
value◼ Revenue model related to the size of merchant

Large

①

➁

③

④

Medium

①

➁

③

④

Small

①

➁

③

④

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

44

Business Model

Medium-Term Strategy Acquiring major merchants by focusing on alliances
Meeting customer needs through enhanced credit payment functions and alliances with QR /points vendors

CreditE-money

QR

J-debit

Point

House point/House E-money

Duty exemption

Terminals we offer

Floor-Standing Model

Mobile Model

Embedded Model

POS Model*Alliance partner terminals

Cashless Platform

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

45

Business Model

TRX-increase through cashless penetration
TRX volume & value tend to go up in a few months to six months after the merchants
introduced cashless payment for the first time

◼ Merchant A（Tokyo） Monthly TRX trend

25000000

TRX Volume

6000

TRX Value

20000000
4000

15000000
10000000

Merchant

Cash only ⇒ Introduce cashless
payments

2000

5000000
0

N

N月

N+1

N+1月

N+2

N+3

N+2月

N+3月

N+4

N+4月

N+5

◼ Merchant B（Miyagi）Monthly TRX trend
800000TRX Volume

Consumer

500
400

400000Recognize convenience（Successful experience⇒change in payment method）

600

TRX Value

600000300
200200000

100

0

0
N

N月

N+1

N+1月

N+2

N+2月

N+3

N+3月

N+4

N+4月

◼ Merchant C（Wakayama）Monthly TRX trend
9000000

N+5月

TRX Volume

Merchant

TRX volume/value
per terminal will increase

500

TRX Value

400
300

700000200
500000Stock-Model revenue will increase

100

300000

0
N

N月

N+1

N+1月

N+2

N+2月

N+3

N+3月

N+4

N+4月
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

46

Projection

Guidance of FY2022
In FY2021, gross profit growth was low compared to sales increase (as expected) due to special
factors in FY2020 and a change in the composition ratio of payment terminal sales.
FY2022 forecast aims to achieve OP target with the same sales composition as FY2021
Initial Revenue

Stock-Model Revenue

Gross profit

9,000 (Millions of Yen)

8,550
Revenue

8,000+20.6％ YoY

7,089
7,000

6,000

*GPM stands for Gross Profit Margin. GPM ofeach revenue is rough image and it varies fromtime to time
Revenue

GPM*
Stockmodel

3,691

2,000

1,000

0

Revenuecomposition
ratio
60%

60%

27%

80%

25%

Payment
terminal

15%

73%

Gross Profit

61%

FY202015%※Estimatedconservatively partly
due to new revenue
recognition standard

Same level as
FY2021+19.8％ YoY+24.9％ YoYSpecialfactor25%

Payment
terminal

Development

Gross Profit

Same level as
FY2021

Revenuecomposition ratio

Development*

39%

Payment
terminal

3,000

GPM*
Development Stock-model

4,000

60%

Stock-model+92.0％ YoY
5,000

GPM*

2,020

1,617

2,421

OP growth rate

+25.1% YoY
FY2021
Copyright (C) 1999 GMO Financial Gate, Inc.

FY2022All Right Reserved.

47

Market Environment

TAM (Total Addressable Market)
Value of cashless (face-to-face) payment is expanding rapidly, as the value of IoT / Unattended◼ Offline TRX value in Japan
Private sector final
consumption
expenditure in
Japan (includes
cash payments)◼ Potential market value of IoT/Unattended
Potential market size for
IoT/Unattended (ourprediction)¥278 trillion*2(2020)* Due to the spread of coronavirus infection
Dropped to the same level as during the Lehman shock¥30 trillion*3(2020)¥111 trillion*1(2025)¥0.1
trillion¥97 trillion*1(2022)GMO Financial Gate TRX value
in IoT/Unattended business¥1.2
trillion

Market foroffline cashless(face-to- face) payments

GMO Financial Gate TRX value(FY2021 Actual)◼ To achieve ¥1.5 billion in operating profit for FY2024：
Expand IoT/Unattended business driven bycontactless payment (touch payment) and unattended
registers(*1) Source: Cashless Roadmap 2019, PAYMENTS JAPAN; Current Status and Future Forecasts for Online Payment Service Providers, 2018, Yano Research Institute Ltd.
(*2) Source: Cabinet Office, Government of Japan(*3) GMO Financial Gate internal forecast based on statistical data published by the Cabinet Office, Government of Japan, the Japan Vending System Manufacturers Association, and the Japan Parking Business Association(*4) Source: Japan Ministry of Economy, Trade and Industry

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

48

Market Environment

Market Growth of Offline Cashless (face-to-face payments)
The market for offline cashless payments is currently ¥92 trillion, six times larger than the
online market. Cashless penetration is expected to rise to as much as 80%, driven by
government-led cashless policies
120

60.0%

80％
(¥222
trillion)

96.7

100

50.0%

91.9
（Unit: trillion Yen）

86.3
81.6

80

32.5%

73.8

30.9%
29.7%

64.5
60

59.6

40％
(¥111
trillion)

26.8%

24.1%

20.0%

40.0%

Long term
Vision

30.0%

21.3%

40

Around 2025

20.0%

18.7
14.4

20
10.0

0

2016
2016年
(A)

10.7

2017
2017年
(A)

11.7

2018
2018年
(A)

16.3

10.0%

12.9

2019
2019年
(A)

対面キャッシュレス決済市場
Offline cashless market size

2020
2020年
(A)

0.0%

2021
2022
2021年（予）2022年（予）(E)(E)

非対面決済市場（BtoC-EC）
Online (EC) market size (B to C)

対面キャッシュレス決済比率
Offline cashless penetration rate
Source: Cashless Roadmap 2019, PAYMENTS JAPAN; Yano Research Institute Ltd.

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

49

Market Environment

Composition of Cashless Payment Methods
While cashless payments have become more diversified, credit card use is still high Ecommerce composition ratio declined, QR code increased◼ TRX value of cashless payment◼ Credit card brand share in Japan (2020)（Unit：trillion yen）

100

Credit card

Debt card

E-money

QR codeCashless penetration（Right axis）

80
60
40

0.2
5.5
5.1

50.0%

3.1 0.3 0.1

4.2
1.1
6.0

5.8

5.2
24.1%

29.7%

26.8%

40.0%
30.0%
20.0%

20.0%

21.3%

53.7

58.2

66.8

73.0

73.8

2016

2017

2018

2019

2020

20

17.8

10.0%

0

0.0%

50.8
28.0

◼ Composition of cashless payment methods
100.0%

8.5%

8.0%

0.2％

1.4％

4.9％

7.4%

7.1%

7.0%

80.0%
60.0%
40.0%

90.0%

90.5%

90.3%

89.5%

85.5%

VISA
Master
DinersJCB
AMERICAN・EXPRESS
UnionPay

20.0%
0.0%

2016

2017
Credit card

2018
Debt card

2019
E-money

2020
QR code*Source: Ipsos Financial Service*Source: Ministry of Economy, Trade and industry

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

50

Market Environment

IoT/Unattended Market Growth
The number of terminals is expected to be equal to or greater than the market for payment
terminals in real stores. Unattended market (= general term for vending/service machine
market) is expected to expand further due to changes in the external environment such as adecrease in the working population◼ No of active IoT terminals（Unit: 10 Thousands）

4.5 million◼

5
Push factors associated with changes inthe external environment• Declining workforce

Grew slightly due to the time-lag between terminal
sales and activation even though the terminal
4.3
sales stays solid
4.0

4• Labor-saving support
Unattended

Goods/
commodities

Tickets

Beverages/
sweet treats

MarketSelf-checkoutmachine(Golf/Hotel)• Obtaining inbound demand• Retailers moving into offices• Revision of the Pro-Sales Act• COVID-19
CoffeeMetered parking/
EV chargers

Self-checkout
registerCoin-operated
washing
machines

3.4
3Market

2.6

2.8

2.9

3.1

2.2
2
1.4
1

0

Offline

4.2

Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
FY2020 FY2020 FY2020 FY2020 FY2021 FY2021 FY2021 FY2021 FY2022 FY2022

4 million
Source: The Japan Vending System Manufacturers Association, Japan Ministry of Health Labor and Welfare, Yano Research Institute Ltd.

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

51

Growth Strategy

Strategy to Maximize TRX Value
We created a new payment processing route with alliance partners. This route increases GMV,
as the route reduces costs to participating merchants and acquirers

RetailRestaurants

Acquirers

Conventional
RouteMerchants
Competitor/Peer
Terminals
Processing
Center

Payment
Network

1

2
Credit Card
IssuerVending
Machines
MeteredParking/
EV Meters

New GMO FG
RouteServices

New Terminal
Modeletc.・・・

Reduced costs toparticipating
merchants

Cost Reduction

Bank

compared to conventional route

gateway
Global payment network◼ Cost savings via new route leads to

Reduced costs to acquirers

improved competitive capability of alliance partners
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

52

Growth Strategy

Strategy to Maximize TRX Value
Maximize GMV through a new processing network and by pursuing B-to-B alliances(*1)

Offline Cashless (face-to-face)Market (2025 E)

TRX value: ¥111 trillion/year

Offline Cashless (face-to-face)Market (2021 E)

TRX value: ¥92 trillion/year

Continuous Growth

Aim to achieve
more than

18x+α TRX

Alliance partner
VJA (Visa Japan) Group,
including Sumitomo Mitsui
Card Company, Limited

TRX value：¥22 trillion/year

GMO-FG

TRX value：¥1.2 trillion/year

value in 10 to 15
years

(*2)

approx.

18x

2021

2030～2035(*1) Source: Cashless Roadmap 2019, PAYMENTS JAPAN; Current Status and Future Forecasts for Online Payment Service Providers, 2018, Yano Research Institute Ltd.
(*2) Source: VJA

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

53

Growth Strategy

Growth Strategies for 2025 and Beyond
For 2025 and beyond, we aim to grow stock-model revenue in the payment-related field.
Aim at a continuous 25% growth in OP through business diversification：High inbound tourism demand

Image of service expansion

Area of focus

OP (100 million yen)

Money services / Payment related New Biz• Fintech (Lending / Factoring / BNPL etc.)

Profitability increase phase100
Data service• DX/marketing support using payment data

OP of 25% or more
Continuation of growth curve
Money services/Payment related New Biz

Diversification of alliancestrategies

IoT (Mobility)• Contactless payment processing fortransportation systems (trains, buses, etc.)

Data service

IoT (Vending / checkout machines)

Stock-Model Revenue

Market share increasephase• With & post COVID-19 / labor-saving / selfservice support

IoT (Mobility)

Payment terminals (excluding IoT) / Payment processing / Acquiring

15
Payment Center• Continue to acquire a balanced
member merchant base, regardless of
size or industry, as our businessfoundation

Payment terminals(excluding IoT)

Payment terminals (excluding IoT) / Payment
processing / Acquiring

Initial & Stock-Model

IoT (Vending /checkout machines)

Time
2021

2025

2035

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

54

Growth Strategy

Data Services in the IoT Domain
Started providing payment data service for merchandise vending machines, contributing tostock-model revenue. Supporting merchants' operational efficiency improvement andsophistication (DX) using data
Appropriate stock replenishment and cash
collection

Vending machine operator

IoT
Payment
terminals

payment processing

Start providing data sharing service to merchandise
vending machines for food service (ramen, gyoza, etc.)⇒Contribution to stock-model
revenueAchieve efficient staffing andfood loss reduction

Vending
machinemanufacturer

DX Support

Provide payment data (sales
information)

Image of introduction

phase ２DX in member merchants

New

Provide payment data (sales information) to alliance partners⇒Strengthen marketing and increase revenue by using sales
information (product, season, region, etc.)

Provision of payment data (sales information) to vending machine
manufacturers⇒Improve operational efficiency by remotely managing inventory at an
appropriate level

phase 1
IoT payment/acquiring

Payment terminals (IoT)

Provision of IoT platform

Initial &Stock-Model

Payment Center

Stock-Model
Revenue

Present

phase ３
DX in member merchants(sales improvement)

Time
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

55

Growth Strategy

Alliance Overview
Working with alliance partners allows us to secure participating merchants consistently andsteadily

Alliance Partners

Payment/
Financial
Institutions

Unattended
Terminal
Manufacturers

POS
Manufacturers

GMO Group
Synergies

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

Vending Machines

Metered Parking
EV Meters

Laundries

Entertainment

TravelWholesalers

Real Estate

Occupation/
Vocational Schools

Healthcare/Welfare

Hotels/Inns

Bus/Train

Restaurants

Retail Stores

Merchants

56

Competitive Advantage

Unique Positioning
End-to-end solutions via one-stop platform allows us to create alliances with many players in
the market◼ Solutions in Offline Payment Market
Customization(Customize Payment
Methods)

Adaptation of
Top-End POS
Register Models

Terminal
Settlement

ーー

Payment
Processing

Clearing/
Adjustment

Maintenance/
Support

FG

N
N社

Leading payment
大手決済ネット
network playerーー

ワーク事業者

R
R社

Major operating
大手事業会社
companyーー
Using their own registers only

P
P社

Leading payment
大手決済事業者
vendorーーーー

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

57

Competitive Advantage

Barriers to Entry （Regulations to be Followed）

Many kinds of regulations exist in the face-to-face payment market depending on the payment
method, and the number of regulations are increasing. As payment methods become morediversified, the barriers to entry become more challenging

Law

E-money
Regulation

Modified Partial
Revision of the
Installment Sales Act

Brand Test

Credit Card
Regulation

Security Standard

PCI DSS
Global security standard in credit card
industry created by international big 5 credit
card brand, Visa, Mastercard, JCB, American
Express and Discover

Payment Center
Regulation

JCCA Certified
Center

EMV Test
International standard of IC Card created by
Europay, Mastercard and Visa

JCCA：Japan Credit Card Association

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

58

Industry Topics

Government Promotion of Cashless Payments
METI* announced its Cashless Vision policy to encourage cashless payments. We expect
the Japanese cashless market to expand rapidly in response
Events

Impact on our business

4/2018

Announcement of Cashless Vision（by METI）

6/2018

Enforcement of Revised Installment Sales Act

3/2019Implementation plan announced for the security of credit
transactions (by the Council for credit Transaction Security)

10/2019

Cashless Consumer Returns Policy

7/2020

Go To Campaign

9/2020My Number Point

7~9/2021

1/2022

Tokyo Olympic/Paralympic

Demand for cashless terminals
increases as business owners areforced to adopt cashless payment
systems

Payment processing expands in
response to Cashless Consumer
Returns Policy

Demand for cashless terminals
increases due to expanding inboundconsumption growth

My number point, Go To Campaign

Present

9/2024Issuance of new bank notes

4/2025

Osaka Expo

Demand for cashless terminals toincrease due to the cost of new banknote issuance

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

59

Industry Topics

New topic of credit card industry
METI requires fee among credit card companies. Though merchant fee would be lower going
forward, the impact towards our business would be immaterial
Breakdown of MDR（model case：AOV ¥5K SME merchant）

METI requires fee among credit card companies
3.5

Fee among credit card companies is
actually paid by merchants

Brand fee

0.05

Brand fee

International
Brands①Brand fee

3

Fee among card companies(Interchange fee)

2.5

2.3%

Card
company(Acquiring)

Card
company(Issuing)

Billing

Reimbursing

Merchant fee

Billing
Rate inlongtail
could behigherthan this②IRF

Reimbursing

1.5

Payment

2.30

2

3.25

Billing

Our monetization points

1

0.16

Goods/Services

Merchants

Consumers➂Remittance fee④Network fee
0.14

0.5

0.3

➄Acquiring fee⑥Others
0.3

0Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

60

Industry Topics

Japan Post Bank started charging on depositing coins
On January 17, 2022, the introduction of a fee-based checkout service for coins began.
Advancing the trend toward cashless operations by headwinds for businesses that handle
large volumes of coins

Coins may disappear

Japan Post Bank「Charging-shock」(March 4, 2022 Sankei News paper)https://www.sankei.com/article/20220304-ZTSR67LNFFLLTITPJFJL6D3TZQ/ATMCounterNumber of coin deposit

Cost

Number of coin deposit

Cost

1～25

¥110

1～50

Free

26～50

¥220

51～100¥550

51～100^330

101～500

¥825

ー

ー

501～1,000¥1,100After above、every 500¥550

Limitation : 100 (in each time)

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

61

Industry Topics

The case of COVID in Japan Jan-Mar 2022
Q2 stock-model revenue was unlikely to grow compared to Q1 standalone due to the rapid
increase of new case of COVID during our Q2 FY2022 (Jan-Mar 2022)
The number of daily test positive case of COVID

Q2100,000

Applied “Prevention of Spraeding COVID
Jan 7～Mar 21

90,00080,00070,00060,00050,00040,00030,00020,00010,000

2020～

2021～

2022～

0
Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Feb

Mar

Apr

May Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Feb

Mar AprSource : Ministry of Health, Labour and Welfare
Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

62

Industry Topics

Initiatives for terminal-less payments

Implemented various measures to prepare for future handset-less payments. Strengthening
Initiatives in the Mobility Domain and Beverage Vending Machines.
Status of Our Efforts
Tap to Phone

Dec 2021～ NewStarted handling touch settlement of JCB at Nagaden-bus

NFC tagging touch payment

Planning to launch in FY2022

Aiming to provide services with major food manufacturers

NFC tag on vending machines

Dec 2020～

New

Terminal-less

Automatic connection
to the internet byholding a smartphone

Select productNo app is needed

Launched handset-less NFC-touch payment service with Soft Space

Pay with biometrics
Merchandise receipts

Settlement completed(Apple Pay, Google Pay)

High Security
Tap to Phone: Mobile payment service where merchants do not need to prepare cash registers and terminals for payments, and NFC-enabled devices can be used as payment reception terminals.
NFC: An abbreviation for Near Field Communication, a communication standard that can be communicated using contactless IC chips and simply by holding them over.
NFC tag: Tags that allow NFC-enabled devices and devices to perform various operations simply by holding up an NFC-enabled smartphone.

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

63

Share holder Structure

Share holder structure
Maintain the ratio of institutional investors both overseas and domestic, even when stock
prices adjust from the end of 2021
Shareholder Composition
100.00%80.00%

60.00%

22.20%

21.87%

1.65%
6.93%

1.54%
6.35%

11.84%

13.19%

Shareholder composition excluding
GMO Payment Gateway

30.7%

50.9%

14.8%

40.00%
3.6%
57.38%

57.05%

20.00%

Retail Investors
個人投資家・その他

Domestic
国内機関投資家
Institutional
Investors

Other
その他法人
enterprise

Foreign Institutional
海外機関投資家
Investors

0.00%

End
of Sep 2021
2021年9月30日時点

End
of Mar 2022
2022年3月31日時点

GMOペイメントゲートウェイ
GMO Payment Gateway

個人投資家・その他
Retail Investors

その他の法人Other enterprise

海外機関投資家
Foreign Institutional Investors

国内機関投資家
Domestic Institutional Investors

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

64Governance / ESG

ESG Initiatives
Announced ESG initiatives to improve our social activities. We are planning to strengthen our
initiatives and announcement
Disclosure contents

SDGs items

ESG
Initiatives

Environment

・Use of recycled paper as receipts

・Use of recycled paper as receipts
・Promoting paperless
・Appropriate inventory management through the use of payment
data (reduction of food loss)

Announced on Creating an eco-friendly society
Jul 15thSocial・Providing a variety of vocational training programs
・Preparing sufficient welfare programs
・Promoting work-style reform etc…

Human Resources, Vocational Training/Welfare Program, Work-style Reform

Governance

Planning to enforce
corporate governance onward

Basic Principles, Board of Directors, Executive
Officer Meeting, Audit and Supervisory Board,
Director Compensation, Investor Relations
Reference URL

https://gmo-fg.com/news/8d448cfaba24ece540af1ae2a83d95c2.pdf

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

65Governance / ESG

ESG Initiatives
Appointed a new external director and established Nomination and Compensation Committee
to provide a skill matrix for our executives. Continuously work to strengthen the governancesystemNomination and Compensation Committee

Skill matrix

https://gmo-fg.com/ir/153d49bfef329b9dfa8e005c510a3475.pdf

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

66

Company Profile

Affiliated Companies
GMO-FG serves in offline face to face payment market as a consolidated subsidiary of GMO-PG.

GMO INTERNET GROUP（Internet infrastructure business）

GMO PAYMENT GATEWAY（Online payment/Payment section of GMO internet group）

Consolidated

GMO EPSILON100%

GMO PAYMENT SERVICE

100%
Equitymethod40%

57.3%（Online payment/Longtail）（Online payment/Deferred payment）

SMBC GMO PAYMENT（Online/Offline payment/）

GMO FINNCIAL GATE

（Offline payment）

Consolidated

100%

51%

GMO CARDSYSTEMGMO DATA

Consolidated subsidiary

Sumitomo Mitsui Credit Card

（Offline payment/Longtail）（Payment processing center）

49%

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.

67

Company Profile

Company Profile■Company

GMO Financial Gate, Inc.（TSE Growth Ticker:4051）■Foundation■Address■Stock Capital■Major Shareholder■Board Member

September 1999
Humax Shibuya Building 7F, Shibuya Dogenzaka 1-14-6, Tokyo¥1,618 Million
GMO Payment Gateway, Inc.
Representative Director, President
Kentaro Sugiyama
Director, Chairman
Akira Takano
Director
Akio Aoyama（Sales Division Executive Manager）
Director
Masamitsu Ikezawa（Administrative Division Executive Manager）
Director
Tomonaga Fukuda（System Division Executive Manager）
Director
Tatsuya Koide（GMO Payment Gateway, Inc. Chief Managing Executive Officer）
External Director
Nao Shimamura
External Director
Rie Asayama
External Auditor
Takayoshi Nagasawa
External Auditor
Satoru Ozawa
AuditorTakashi Iinuma（CPA)■Auditing Firm
■Subsidiary

Ernst & Young ShinNihon LLC
GMO CARD SYSTEM, Inc. shareholding ratio:100％
GMO DATA, Inc.

■Businessshareholding ratio: 51.0% (Mitsui Card Company, Limited:49.0％）

Cashless payment infrastructure service (credit card, debit card, e-money etc.)

Floor-Standing Model

Mobile Model

Embedded Model

POS Model

Copyright (C) 1999 GMO Financial Gate, Inc.

（As of February 10, 2022）

All Right Reserved.

68

T h a n k

Y o u

GMO Financial Gate, Inc(Tokyo Stock Exchange Growth
IR website

4051)

https://www.gmo-fg.com/ir/

Contact:
TEL：+81-3-6416-3881
E-mail：irpr@mail.gmo-fg.com

Copyright (C) 1999 GMO Financial Gate, Inc.

All Right Reserved.