Financial Results Briefing for Q1 FY2022
Key Message【Steady expansion of Stock-model revenue due to an increase in the number of active terminals】

February 10, 2022

GMO Financial Gate, Inc.
(Ticker:4051, TSE-M)

7th 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 February 10, 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 Q1 FY2022
2. Growth Strategy and Progress

3. Financial Highlights

4. Appendix

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

3

1. Summary of financial Results for Q1 FY2022

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

4

1.1

Q1 FY2022 Summary

Recorded steady progress towards full-year forecasts for both sales and profit.
Terminal sales contributed to KPI expansion.

Quantitative comments•

Q1 FY2022

P6

Progress towards full year forecast:- Revenue:¥2.14 billion(＋66.5％ YoY) 25.0％- Operating Profit :¥0.21 billion(＋28.6% YoY） 28.5％•

Every type of revenue grew steadily P9- Initial revenue:¥1.45 billion(＋70.0％ YoY)
- Stock-Model revenue :¥0.69 billion(＋59.6％ YoY)

•

KPIs

P16、17

Qualitative comments- No. of active terminals:143.2K（＋60.4K YoY, 1.7x growth YoY）
- TRX volume:64.97 million(2.4x growth YoY), GMV:¥525.1 billion(2.3x growth YoY)•

Post-COVID measures by accumulating the number of active terminals are successfully progressing⇒Thanks to the establishment of a sales-force structure and system preparation in the early stage of COVID•

Accumulated merchandise inventory in light of the supply status of terminals. Managed B/S ppropriately•

Upgraded back-office functions and launched early payment services for merchants•

Developed transport-related payment business and steadily expanding the mobility domain•

Strengthened the service related to terminal-less payment (Tap to Phone/NFC tagging touch payments)
Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

5

1.2

Summary of Financial Results

Steady progress toward guidance in both sales and profits. TRX volume and GMV grewsignificantly due to the expansion of the number of active terminals.

（Millions of yen）

Guidance
FY2020 1st half
（Full-year）

Progresstowards guidance

Q1 FY2021

Q1 FY2022

Revenue

1,286

2,141

＋66.5%

4,052（8,550)52.8%（25.0%)

Gross profit

466

604

＋29.5%

1,130(2,421)

53.5%（24.9%)

Operatingprofit164

210＋28.6%

359
(737)

58.5%
（28.5%)

Profit attributable toowners of parent

110

139

+26.1%

226
(461)

61.5%
（30.2%)YoY

No. of active terminal

TRX Volume

TRX Value (GMV)（As of Dec 2021）（Q1 Only）（Q1 Only）

KPIs

143,194

Approx. 64.9 million

Approx. ¥525 billion（YoY）（1.7x）（2.4x）（2.2x）

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

6

1.3

Major Topics Regarding Financial Results

Q1 for the previous fiscal year was low due to the start of stera, and initial sales drove growth.
Steady growth in high-margin Stock-model revenue.
2,500◼ Revenue（Unit：Millions of Yen）(＋)In the previous fiscal year, 1Q was stera in the start-up period, while in the current fiscal year, sales
increased significantly YoY due to stera sales becoming at a cruising pace.
(＋)Steady expansion of recurring revenue, centered on fee sales.
⇒Growth due to termination of State of Emergency Declaration and seasonal factors (year-end
sales campaign).

Revenue（+66.5％ YoY）
2,000

◼ Gross Profit
1,500

2,141

(＋)Steady expansion of Stock-model revenue.
(±)The growth rate of gross profit is lower than the one of revenue. This is because thecomposition rate of stera out of total revenue increased compared with the Q1
FY2021.
(±)There is no significant change in the gross profit margin of terminal-sales, and it
remains stable.

◼ Operating profit

1,000

Gross Profit（+29.5％ YoY）
1,286
500

466

604

(＋)cost management(±)Steady progress with full-year recruitment plan ofaround 15 employees

Operating Profit（+28.6％ YoY）
164

210

0
売上高

売上総利益

2021/9期 1Q

営業利益

2022/9期 1Q
Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

7

1.4

Revenue forecast FY2022 (Quarterly)

Due to the high percentage of sales accounted for by payment terminals, sales may rise or fallon a quarterly basis, but we assume well-balanced trends in line with forecasts.

Full-year Revenue Forecast（+20.6％ YoY）
8,550
（Unit：Millions of Yen）

2021/9期
FY2021(Actual)2,500(Actual)+66.5％ YoY2022/9期
FY2022

Revenue forecast image(Quarterly)

7,090

2,000

1,500

2,252

1,000

2,141
1,286

2,021
1,531

500

0

Q1
単1Q
Standalone

Q2
単2Q
Standalone

Q3
単3Q
Standalone

Q4
単4Q
Standalone

FY20212021/9期

FY20222022/9期

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

8

1.5

Revenue by Business Model

Steady expansion of recurring revenue through continuous accumulation of active handsets.
Balanced growth in both initial sales and recurring revenue.

(Unit：Millions of Yen)

Q1 FY2021%

Q1 FY2022%

YoY

Initial

855

66.5％

1,455

67.9％

+70.1％

Stock-model

430

33.4％

687

32.1％

+59.6%

Stock

136

10.6％

186

8.7％

+37.0％

Fee

101

7.9％

262

12.2％

+157.8％Spread

193

15.0％

239

11.2％

+23.9％

1,286

100.0％

2,141

100.0％+66.5％

Total Revenue

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

9

1.7

Revenue by Business Model (Quarterly)

As a result of continuous efforts to sell and install payment terminals even in the aftermath of
the COVID, Stock-mode revenue grew steadily .Steady progress in market share expansion
strategy.
Initial Revenue

Stock-model Revenue（Unit：Millions of Yen）

（Unit：Millions of Yen）

Pre-COVID

Under COVID

1,800

Pre-COVID
800

1,682
1,525

1,600

Under COVID+¥324 million(＋89.3%)

Spread
スプレッド

1,454

1,400

Fee
フィー

700

Stock
ストック

569

600

1,200

1,103
855

800

400

363

367

693

626

300

600

451

110

160

333

136
132

118

200

400

75

262

146
183

80

70

182

427

391

128

465

186

495

500
430

1,000

687

101

99

193

182

149

80

200

100

0

0
Q1
20/9期
FY2020

1Q

Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
20/9期
20/9期
20/9期
21/9期
21/9期
21/9期
21/9期
22/9期
FY2020 FY2020 FY2020 FY2021 FY2021 FY2021 FY2021 FY2022
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q

State of Emergency Declaration①
Apr 7～ May 25

178

180

125

179

186

203

239

Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
20/9期
20/9期
20/9期
20/9期
21/9期
21/9期
21/9期
21/9期
22/9期
FY2020 FY2020 FY2020 FY2020 FY2021 FY2021 FY2021 FY2021 FY2022
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q

State of Emergency Declaration②
Jan 7～Mar 21③
Apr 23～ Jun 21④①
Jul 12～ Sep 30

Apr 7～ May 25②
Jan 7～Mar 21③
Apr 23～ Jun 21④
Jul 12～ Sep 30

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

10

1.8

Initial revenue and No. of active terminals (Quarterly)

Initial sales, centered on the sales of payment terminals, progressed as planned, and the numberof active terminals increased steadily.

+18.3

143.2

Initial revenue（Unit：Millions of Yen）
No. of active terminals+17.8（Unit：Thousands）

+14.1

124.9

Assuming the transition incertain range

107.1

+12.3
+8.0

93

+5.3
80.7

+9.8
+10.6

67.4

72.7

57.6

47

1,103

1,525

1,682

1,454

855
626

Q1
FY2020
20/9期
1Q

693

451

Q2
FY2020
20/9期
2Q

Q3
FY2020
20/9期
3Q

465

Q4
FY202020/9期
4Q

Q1 FY2021
21/9期
1Q

Q2 FY2021
21/9期
2Q

Q3
FY2021
21/9期
3Q

Q4
FY2021
21/9期
4Q

Q1
FY2022
22/9期
1Q

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

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

Action Plan

Parking lot

High-end
retail/Department
store

IoT

mobility

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 retailService/
Leisure(Incl: fine dining)

Comprehensive proposals
with alliance partners
High unit
price
GMO Card System(consolidated subsidiary)

Medical / Clinic

Store scale : Small
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12

1.9

Percentage of top merchants out of total GMV

Building a well-balanced merchant portfolio without relying on top rankers through theacquiring of new merchants.
◼ Composition rate of GMV top rankers
Dec 2020

Dec 2021

GMV : ¥84.6 billion

GMV : ¥192.8 billion (+127.9% YoY)

14.9%
26.1%
20.9%
25.0%
63.0%
75.0%

32.9%

37.0%

Top 10
上位10社

Top 20
上位20社

Top 30
上位30社

Othersその他

Top 10
上位10社

Top 20
上位20社

Top 30
上位30社

Others
その他

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

13

1.10

Top ranked merchants (GMV basis)

Aggressively acquired supermarkets, drug stores, etc., where stable payment volumes are
expected even under COVID. Focused on restaurants, hotels/travel with an eye on post COVID◼ GMV Top 30
Dec 2020
Retailer
High ASP retailer
Drug store/Pharmacy
Drug store/Pharmacy
Super market
Retailer
Service
Medical/Clinic
Service
Retailer
Service
Retailer
High ASP retailer
Medical/Clinic
ServiceHigh ASP retailer
Super market
Service
Retailer
Medical/Clinic
ServiceHigh ASP retailer
Hotenl/Travel
Medical/Clinic
Medical/Clinic
Café chain
Hotenl/Travel
Drug store/Pharmacy
Medical/Clinic
Service

Dec 2021

Total of top 30 TRX value¥31.3 billion

RetailerSuper market
Retailer
Drug store/Pharmacy
Low ASP retailer
Super market
Drug store/Pharmacy
Super market
Medical/Clinic
Service
Medical/Clinic
Chain Restaurant
ApparelDrug store/Pharmacy
Hotel/Travel
ServiceHigh ASP retailer
Super market
ServiceSuper market
ServiceSuper market
Service
Hotel/Travel
High ASP retailer
Service
Retailer
High ASP retailer
Hotel/Travel
High ASP retailer

New

New

New
New

Total of top 30 TRX valueNew¥48.2 billion

New
New
New

(YoY+54.0%)

New
New
New
New

◼

15 of the top 30 companies
newly ranked◼

TRX value of existing
merchants also has been
growing

New

New

New

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14

1.11

Transaction Trends by Industry (Q1)

KPIs expanded in Q1 due to recoveries in industries that had been affected by COVID.
Successfully accumulated the number of active terminals which is a measure for Post COVID.
3E+09

Merchant A

Merchant C

Transaction Volume

2.5E+09

Transaction Volume

Chainrestaurant

00000

Termination of SOE

GMV

Super market
Recorded stable GMV even under SOE

600,000

2021

1.5E+09
60000

00000

50000

00000

00000

2E+09
80000

70000

00000

00000

90000

800,000

GMV

COVID =against (negative)

00000

1,000,000

COVID =follow (positive)

400,000

1E+09
40000

30000

2021

200,000

500000000
20000

00000

10000

0

0
Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

0

0

Dec

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

5E+09

Merchant B

4.5E+09

Transaction Volume

400000000

Merchant D

100000COVID =against (negative)

500000000

4E+09

Termination of SOE

GMV

3.5E+09

70000
3E+09

Hotel/Travel

2.5E+09

300000000

Drug store/
Pharmacy

Transaction Volume

1,400,000

GMV

1,200,000

Recorded stable GMV even under SOE

1,000,000(Drug/Cosmetics)

800,000

2021

Oct-Dec：Domestic demand 40000
2E+09200000000

2021

600,000

1.5E+09

Jul-Aug：In-Bound demand
spiked because of the spot
factor caused by international
event held in Japan

100000000

400,000

10000
1E+09

200,000

500000000-20000 0

0Jan1,600,000

COVID =follow (positive)

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan
21.1

Feb
21.2

Mar
21.3

Apr
21.4

May
21.5

Jun
21.6

Jul
21.7

Aug
21.8

Sep
21.9

Oct 21.11
Nov 21.12
Dec
21.10

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

15

0

1.12

Consolidated KPIs（No. of Active Terminals）

Active terminals increased steadily, mainly in stera. IoT was driven by the activation in hotels
and leisure facilities. The portion of “alliance partner sales” increased due to the seasonality,
mainly coming from retailers which regularly record high GMV in November and December.
160

Total active terminals：＋62.5K units(+77.5%) YoY（Unit：Thousands）

QoQ 143.2
140

＋18.3

Alliance partner
sales

17.9

+2.9K
(+19.7%)

＋1.4

120

IoT

16.4

100

42.3

16.7
80.7

80

14.4

13.6

60

21.5

＋13.3K(＋45.6%)

Payment terminal(excluding IoT)

33.6
30.9

9.6
8.5

＋2.5

39.8

16.7

14.9

40

By terminal type
YoY

29.1
28.0

26.1

＋14.4 83.0

68.7

14.1

＋46.3K(＋126.2%)

56.8

20

24.4

26.5

27.7

30.3

2020/9期
1Q
Q1 FY2020

2020/9期
2Q
Q2 FY2020

2020/9期
3Q
Q3 FY2020

2020/9期
4Q
Q4 FY2020

36.7

45.4

0
2021/9期
1Q
Q1 FY2021

Payment
terminal (ex. IoT)
決済端末(除くIoT)

IoT

2021/9期
2Q
Q2
FY20212021/9期
3Q
Q3 FY2021

2021/9期
4Q
Q4 FY2021

2022/9期
1Q
Q1 FY2022

Alliance
partner sales
当社提携先販売分

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16

1.13

Consolidated KPIs (Quarterly TRX volume/GMV)

Continued to exceed our target of +50%YoY by acquiring merchants and providing payment
terminals without bias toward business industries.

◼ Transaction Volume◼ GMV（Unit：million）

2.4x YoY

70（Unit：100 million yen）

2.2x YoY

5,500

60

Omicron＋Seasonality

50

5,000

Omicron＋Seasonality

4,500
4,000
3,500

40

3,000
30

State of Emergency Declaration
（1st）

2,500
2,000

SOE（2nd）・Seasonality

20

State of Emergency Declaration（1st）
SOE（2nd）・Seasonality

1,500
1,000

10
20/9 1Q

20/9 2Q

20/9 3Q
SOE①

Apr 7～May 25

20/9 4Q

21/9 1Q

21/9 2Q

21/9 3Q

21/9 4Q②③④

22/9 1Q

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

20/9 1Q 20/9 2Q 20/9 3Q 20/9 4Q 21/9 1Q 21/9 2Q 21/9 3Q 21/9 4Q 22/9 1Q①
Apr 7～May 25

②

③

④

Jan 7～Mar 21 Apr 23～Jun 21 Jul 12～Sep 30※In addition to the increase in the number of active terminals and the acquisition of merchants through the sale of payment terminals, thetermination of the Emergency Declaration also provided a tailwind, and the transaction of our merchants grew significantly.
※Q2 is expected to trend at the same level as Q1 due to the COVID(Omicron) and seasonality.

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

17

1.14

Comparison with Market GrowthCredit card payment GMV increased more than 10% YoY in the overall market. Due to an increasein the number of terminals in operation, we remained above +120% YoY.
Left Axis ：GMV YoY

GMO-FG

ALL

Other retailers

Restaurants

Hotel/Inns

Right Axis：GMV-FG Monthly GMV（Unit：%）（Unit：100 million yen）

500
2,000
400

SOE
（1st）

1,500

SOE（2nd）・Seasonality

300

260

226

234
216
200

215

211

186

100

186

160

108 110 111 113 113

193
153

192

202

99

96
84

82

203

190

183

148

97

216

97

91

101

140

98

229
202

222

202

1,000

176

173

102

215

91 93

143

110

130
111 111120

111

106 107109 116
500

113
112

0

0
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
Dec 21/01
Jan 21/02
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
19/10
SOE①

②

③

④

Apr 7～May 25

Jan 7～Mar 21

Apr 23～Jun 21

Jul 12～Sep 30

Source: Ministry of Economy, Trade and Industry

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18

２. Growth Strategy and Progress

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19

2.1

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

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20

2.2

Growth in stock-model rev. due to market share expansion

Continuously increased the number of terminals in operation. The termination of State ofEmergency Declaration and the year-end sales campaign helped to boost stock-model revenue
to an even higher level, exceeding our target of +25% YoY growth.

（Unit：millions of yen）

（Unit：10 thousands）

Pre COVID

Under COVID

1,800

1,600

160

1,682
143.2

イニシャル売上
Initial
Revenue

1,525

140

Stock-model
Revenue
ストック型売上1,400

稼働端末台数
Activeterminals

124.9

1,200

1,103

1,000

855

800

626

67.4

600

400

363

47.0

57.6
368

333

80

YoY+59.8％

686

72.7

60

568

465

451

391

495

430

427

SOE
+
Seasonality

200

120

100

107.1

93.0

80.7

693

1,454

Omicron+Grew higher level
Seasonality
40
Termination of SOE+
Year-end sales※Q2 is expected to remain
at the same high level as
Q1, even if we assume
the impact of Omicronand seasonality.

20

0

0
Q1
FY2020
20/9期
1Q

Q2 FY2020
20/9期
2Q

Q3 FY2020
20/9期
3Q

Q4 FY2020
20/9期
4Q

Q1 FY2021
21/9期
1Q

Q2 FY2021
21/9期
2Q

Q3 FY2021
21/9期
3Q

Q4 FY2021
21/9期
4Q

SOE①

②

③

④

Apr 7～May 25

Jan 7～Mar 21

Apr 23～Jun 21

Jul 12～Sep 30

Q1 FY2022
22/9期
1Q

Q2 image※

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21

2.3

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

FY2021*Actual*ForecastOP¥0.59 billion¥0.74 billion

GMV¥1.2 trillion¥1.8 trillion

2024

2025

2035頃

Over ¥1 billion¥1.5 billion¥10 billion

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

1 payment terminals⚫ Terminal sales steadily contributed to the increase in the number of active terminals.
⚫ Introduced and installed at a wide range of merchants regardless of industry or size.
⚫ New type of terminals such as A920 and A35 are scheduled to begin full-scale handling this fiscal year.

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
⚫
⚫
⚫
⚫
⚫

Increase in cases of mobility payment introduction in city areas.
Growth in IoT payments for hotels and leisure facilities due to the termination of SOE.
Began introduction of payment terminals to beverage vending machines on expressway service area.
Started cashless payment support at smart stores (began “Proof of Content” tests).
Preparing for terminal-less payments such as Tap to phone and NFC-tagging touch payment.

3① Acquire large accounts through expansion of alliances with QR, points, etc.
⚫ Steady Expansion of QR Settlement for Comprehensive Contracts in the IoT Domain (Vending
Machines for Goods area).
⚫ Completed development of QR settlement for terminals scheduled to be delivered to major
parking lot settlement machine manufacturers.

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.

22

Action Plan：

2.4

1

2

3

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 industry and scale.
◼ No. of active terminals * Payment terminals (excluding IoT)
（単位：千台）(Unit : Thousand)

FY2020

FY2021

FY2021

FY2021

FY2021

FY2022QoQ

YoY

End of Q4

End of Q1

End of Q2

End of Q3

End of Q4

End of Q1

(%)

(%)

36.7

45.4

56.8

68.7

83.0

+14.4

+46.3

(+20.8％)(+126.2%)

Payment

Launched stera

Terminals

30.3(excluding IoT)

+6.4

+8.7

+11.4

+11.8

+14.4

◼ Sales forecast of major merchants
Assumed to be shifted within a certain level

Industry

Merchant A

Drug store/Pharmacy

Merchant B

Restaurant chain

Merchant C

Drug store/Pharmacy

Merchant D

Sports goods

Merchant E

ApparelseveralThousands～

More than

Accumulating back log

One thousand～2021/9 1Q

2021/9 2Q

2021/9 3Q

2021/9 4Q

2022/9 1Q

Less than

One thousand
Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

23

4

Action Plan：

2.5

1

2

3

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.
Steady Growth(+0.2)◼ No of active IoT terminals

4.5 million
◼

3.4
3.1
2.8

• Labor-saving support
Unattended

Tickets

Beverages/
sweet treats

MarketSelf-checkoutmachine(Golf/Hotel)

4.0

Push factors associated with changes inthe external environment• Declining workforce

Goods/
commodities

4.2（Unit: 10 Thousands）

2.9

2.6

• Obtaining inbound demand• Retailers moving into offices

2.2• Revision of the Pro-Sales Act• COVID-19
CoffeeMetered parking/
EV chargers

Self-checkout
register

1.4

Coin-operated
washing
machines

Q1
FY2020

OfflineMarketQ2
FY2020Q3
FY2020Q4
FY2020Q1
FY2021Q2
FY2021Q3
FY2021Q4
FY2021Q1
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.

24

4

Action Plan：

2.6

1

2

3

4

Progress of IoT Payment BusinessStarted PoC(proof of concept) test of cashless solutions in smart stores. Introduction of payment
terminals to goods and beverage vending machines has progressed, contributing to initial andrecurring revenue.
2022

2021

StatusIn Progress

Sep

To be launched

Dec

Mar

Jun

Sep

New Topic

Delivered approximately 40,000 payment terminals

Hotel/Golf courses

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

Flow
Fee revenue from active terminals

Stock
Parking lot
Checkout machines

Ticket Machines

Flow
Stock

DX
DX: Digitalize parking tickets, plan to integrate online reservation and payment

Flow

Demand increases due to new lifestyles under COVID

FlowCompleted certification process of all e-money brands, increasing stockmodel revenue
Expand to QR code payment

Implemented PoC test at smart store

Stock

Flow
Stock

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

Stock, fee, and spread revenue from active terminals

To be operated fully

Goods & Beverage vending
machines/coffee machines

New Topic

Began installing terminals at major parking lot operators

Stock
Self-checkout registers

Expanding to comprehensive businessStarted operation of terminals for beverage vending
machines on expressway SA
Began installation of QR settlement for beveragevending machines*No change fromprevious status

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
Started demonstration tests ofcashless solutions in smart stores

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

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

25

Action Plan：

2.7

1

2

3

4

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.

26

3. Financial Highlights

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

27

3.1

Profit & Loss

Sales rose sharply as handset sales, particularly in stera, progressed.Despite an increase incost of sales, SG&A expenses were steadily managed to meet the higher level of grossprofit, and operating income was in line with forecasts.

(Unit：Thousands)

Revenue

FY2021Q1 (actual)

FY2022Q1 (actual)

YoY

1,285,793

2,141,482+66.5%

COGS

819,605

1,537,613+87.6%

Gross Profit

466,187

603,869+29.5%

SG&A

302,684

393,574+30.0%

Operation Profit

163,502210,295+28.6%

Ordinary Profit

163,539

210,360+28.6%

Profit attributable to ownersof parent

110,204

138,957+26.1%

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

28

3.2

Revenue by business model (YoY)

Stock-model revenue grew +59.6% YoY, driven by fees.

（Unit：Millions of yen）
Initial

Stock

Fee

SpreadStock-model revenue
687% of composition

Stock-model rev.
YoY+59.6％

239
262
186

Stock-model revenue
430

11.2%
12.2%
8.7%

% of composition
15.0%

193

7.9%
10.6%

101
136

1,455
66.5%

855

Q1 FY2021

67.9%

Initial revenue
YoY+70.2％

Q1 FY2022

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

29

3.3

Revenue by business model (Quarterly)

Initial revenue decreased QoQ, but recurring revenue continued to trend upward due toexpansion in the number of active terminals and the number and value of payment processing
transactions.

（Millions of

SOE①

②

③

④

4/7~5/25

1/7~3/21

4/23~6/21

7/12~9/30

yen）

Q1
FY2020Q2
FY2020Q3
FY2020Q4
FY2020Q1
FY2021Q2
FY2021Q3
FY2021Q4
FY2021Q1
FY2022

Initial

626

693

451

465

855

1,103

1,525

1,682

1,455

Recorded advances
terminal sales

Launched stera

Stock-model

363

367

333

391

430

427

495

569

687

Stock

110

118

128

132

136

146

160

182

186

Fee

75

70

80

80

101

99

149

183

262

Spread

178

180

125

179

193

182

186

203

239

856

1,286

1,531

2,020

2,252

2,141

SOE

Total

990

1,061

784

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

30

3.4

Balance Sheet

Ensured terminal inventory to a safe level in light of semiconductor supply conditions. In
addition, cash and cash equivalents decreased due to the shortening of the deposit cycle tomerchants.

Q1 FY2022（Thousands of yen）
Cash & Cash equivalents(24.2%)

1,425,249

Current liabilities◼ Points•

Products increased by ¥561,919K due tosecuring inventory of terminals to a safe levelin light of semiconductor supply conditions.

•

In addition to the above, cash and cash
equivalents decreased by ¥2,008,370K due tothe shortening of the deposit cycle tomerchants for the purpose of securing acompetitive advantage and dividend payments.

1,538,473
Non-current liabilities

36,628
Commodities

2,176,765
Total equity (73.2%)
Other current assets

4,304,346

868,323
Non-current assets

1,409,111
Asset

Debt
Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

31

3.5

Consolidated KPIs（No. of Active Terminals）

Terminals (excluding IoT) drove growth. Alliance partner sales grew in line with the OctoberDecember settlement expansion season(Unit:FY2020

FY2020

FY2021

FY2021

FY2021

FY2021

FY2022

QoQ

YoY

Thousand)

Q3

Q4

Q1

Q2

Q3

Q4

Q1

(%)

(%)

Payment
terminal(excluding
IoT)

27.7

30.3

36.7

45.4

56.8

68.7

83.0

+14.4

+46.3

(+20.8％)(+126.2％)

IoT

26.1

28.0

29.1

30.9

33.6

39.8

42.3

+2.5

+13.2

(+6.3％)(+45.4%)

Alliance
partner
sales

13.6

14.4

14.9

16.7

16.7

16.4

17.9

+1.4

+3.0

(+9.1％)(+20.1％)

Total

67.3

72.7

80.7

93.1

107.2

124.9

143.2

+18.3

+62.5

(+14.7％)(+77.4％)

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

32

4. Appendix

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

33

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.

34

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.

35

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.

36

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.

%

Rev Model

3 Business

4 Types of Revenue

Flow Model Rev① Terminal Sales
Business

Initial

72.9％

Stock

8.8％

Fee

7.5％

Spread10.8％(FY2021)② Payment
Processing
Business

Stock Model Rev③ Acquiring
Business

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 Price

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

④

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

44

Business Model

Medium-Term Strategy Acquiring major participating 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

FY2022

Copyright (C) 1999 GMO Financial Gate, Inc. All 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¥92 trillion*1(2021)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

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

Major Cost Reductions

Bankcompared 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.

51

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.

52

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.

53

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.

54

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

55

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.

56

Barriers to Entry （Regulations to be Followed）

Competitive Advantage

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.

57

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.

58

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：ASP ¥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
1

0.16

Goods/Services

Merchants

Consumers➂Remittance fee
0.5④Network fee
0.14
0.3

➄Acquiring fee⑥Others
0.3

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

59

Share holder Structure

Share holder structure
Ratio of foreign institutional investors went up to over 20%.
Shareholder Composition

Shareholder composition excluding
GMO Payment Gateway

100%

7.84%
22.20%

8.07%

80%

8.14%
1.65%

27.8%

6.93%
16.26%

52.1%

11.84%

60%

16.3%

40%

3.9%
59.68%

57.38%

20%

Retail Investors

Domestic Financial Institutions

Other entity

Foreign Instituional Investors

0%
FY2020 end of Sep.

FY2021 end of Sep.

GMO Payment Gateway

Retail Investors

Other entity

Foreign Institutional Investors

Domestic Financial Institutions

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

60

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.

61

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 governancesystem.

Nomination and Compensation Committee

Skill matrix

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

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

62

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.

63

Company Profile

Company Profile■Company

GMO Financial Gate, Inc.（TSE Mothers■Foundation■Address■Stock Capital■Major Shareholder■Board Member

September 1999
Humax Shibuya Building 7F, Shibuya Dogenzaka 1-14-6, Tokyo¥1,605 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.

■Business

Ticker:4051）

shareholding 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（As of February 10, 2022）

Copyright (C) 1999 GMO Financial Gate, Inc. All Right Reserved.

64

T h a n k

Y o u

GMO Financial Gate, Inc(Tokyo Stock Exchange Mothers
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.