INVAST SECURITIES CO.,LTD.

Financial Highlights (Consolidated)
2nd Quarter Fiscal Year ends Mar 2015

Invast Securities Co., Ltd.

Financial Highlights for the 2nd Quarter Fiscal Year Ended March 2015

■Ordinary loss of 552 million yen
Foreign exchange market volatility increased from the latter half of August 2014, helping operating revenue recover slightly. Yet, a period of low
market volatility until then resulted in operating revenue for the quarter under review declining significantly, representing a negative 111.2% of that forthe same quarter a year ago, a quarter of favorable foreign exchange market conditions.
■Recorded 1,015 million yen in extraordinary income on the sale of part of investment securities■Concluded a capital and business alliance agreement with Tradency Inc. in August 2014
Invast Securities and Tradency are planning to co-develop a higher-quality service “New ST24 (tentative name)”, following which they will provide
this service offering as a white-label service■Overseas subsidiary Invast Financial Services (IFS) achieved single-month profitability in the 14th month after business launch■Overseas financial business segment
The balance of deposited margin for the overseas financial business segment amounted to 1,028 million yen as of June 30, 2014. Invast Securities
recorded 185 million yen in operating loss owing to its prior investment■Passed a resolution for the retirement of shares of treasury stock
The Board of Directors’ meeting held on July 30, 2014 passed a resolution for the retirement of 507,000 shares of the Company’s common treasury
stock.
These shares represented 7.9% of the total number of shares outstanding prior to the share retirement, which was implemented on August 15, 2014.
■Passed a resolution for the acquisition of own shares as treasury stock
The Board of Directors’ meeting held on July 30, 2014 passed a resolution for the acquisition of the Company’s own shares as its treasury stock
Total number of shares to be acquired: 200,000 shares (upper limit) (3.4% of the total number of shares outstanding [excluding treasury stock])
Total value of the shares to be acquired: 300 million yen (upper limit) Share acquisition period: From July 31, 2014 to December 31, 2014

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Summary of Financial Results 2Q FY ends Mar 2015
[Financial highlights]
2Q FY2014

2Q FY2015(from April 1, 2013 to September 30,2013)(from April 1, 2014 to September 30,2014)

Non-consolidated

Consolidated

Non-consolidated

2,471

2,471

1,130

1,222

45.7％

49.4％

Commissions earned (exchange FX, etc.)

865

865

281

281

32.4％

32.4％

Trading profit and loss (over-the-counter FX)

1,599

1,599

667

744

41.7％

46.5％

Selling, general and administrative expenses (ditto-)

1,962

2,013

1,526

1,803

77.8％

89.6％

Operating income (-ditto-)

508457△395△581△77.9％△127.2％

Ordinary income (-ditto-)

548496△372△552△67.7％△111.2％

2424

1,012

1,012

4,204.4％

4,204.4％

522

469

403

223

77.3％

47.6％

Operating revenues (in millions of yen)

Extraordinary income/loss (-ditto-)
Net income (-ditto-)

March 31, 2014
Non-consolidated

Consolidated

Consolidated

September 30, 2014
Non-consolidated

Consolidated

Year-on-year change
Non-consolidated

Consolidated

Year-on-year change
Non-consolidated

Consolidated

Net assets (in millions of yen)

13,532

13,23912,014

11,54188.7％

87.1％

Net assets per share (yen)2,314.52

2,264.28

2,068.13

1,986.46

89.3％

87.7％

74,64575,39571,70572,517

96.0％

96.1％

Margins received (in millions of yen)

* The Company recorded 1,015 million yen in extraordinary income on the sale of investment securities as it sold part of its investment securities
holdings in the second quarter under review.
* The financial closing date of IFS is December 31, causing its financial results to become incorporated into Invast Securities’ consolidated financial
results with a time lag of three months. Hence, the consolidated financial results for the second quarter of the fiscal year ending March 2015 aredesigned to reflect IFS’s financial results for the period from January to June 2014.

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2

Operating Revenue
Operating revenue for the second quarter of the fiscal year ending March 2015 stood at 719 million yen.
Trading income in the over-the-counter foreign exchange margin trading service business (ST24, FX24 and TriAuto) amounted to 398 million yen.
Commission received in the exchange-traded foreign exchange margin contract service business (Click 365) totaled 247 million yen.
Net operating revenue of 64 million yen was recorded in the overseas financial business segment (IFS) during the period from April 2014 to June 30,
2014.
Operating revenue for the quarter under review struggled to grow and declined significantly year on year as foreign exchange market volatility remained
low during the quarter in comparison to the same quarter a year ago, a quarter of favorable foreign exchange market conditions (49.4% of the operating
revenue for the year-ago quarter).
(Millions of yen)
1,600

The overseas financial business segment
Exchange FX trading
Over-the-counter FX trading
Other

1,400
1,200
1,000800

FY ended March 2014 [Consolidated](Millions of yen)

Term ended March 2014
1Q

2Q

3Q

Total

Exchange FX trading

538

279

248

323

1,390

Over-the-counter FXtrading
Other
The overseas financial
business segment
Total

894

707

572

530

2,703

43

1091173--44347

1,476

995

833

908

4,213

(Millions of yen)

FY ended March 2015[Consolidated]

600

4Q

Term ended March 2015
1Q4002000
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
FY ended Mar 2013 FY ended Mar 2014 FY endedMar 2015

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2Q

3Q

Exchange FX trading

185

247

Over-the-counter FXtrading
Other
The overseas financial
business segment
Total

282

398

81026

64

502

719

4Q

Total

3

Total amount of deposited margin
The total balance of deposited margin for all the Company’s business segments amounted to 72,517 million yen for the second quarter of the fiscal year ending March2015.
The balance of deposited margin for “Click 365,” the exchange-traded foreign exchange margin contract service business, amounted to 57,514 million yen.
The balance of deposited margin for the “FX24,” “ST24,” “TriAuto” services and others in the over-the-counter foreign exchange margin trading service business stood at
13,974 million yen .
The balance of deposited margin in the overseas financial business segment (IFS) totaled 1,028 million yen as of June 30, 2014 and 934 million yen as of September
30, 2014(Millions of yen)
The overseas financial business segment
90,000FX24/ST24/TriAuto
Click365
80,000FY ended March 2014 [Consolidated] (Millions of yen)
1Q

2Q

3Q

4Q

Click 365

58,74358,31457,372

59,719

FX24/ST24/TriAuto

17,43917,133

15,04014,926

--

48

750

76,18375,44872,46175,39570,00060,000The overseas financial
business segment

50,000Total

40,000FY ended March 2015[Consolidated] (Millions of yen)

30,00020,00010,000
0
1Q

2Q

3Q

4Q

FY ended Mar 2013

1Q

2Q

3Q

4Q

FY ended Mar 2014

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1Q

2Q

FY endedMar 2015

1Q

2Q

Click 365

58,94257,514

FX24/ST24/TriAuto

15,051

13,974834

1,028

74,82872,517The overseas financial
business segment
Total

3Q

4Q

4

Concluded a capital and business alliance agreementwith Tradency Inc. (1)Entered into capital and business alliance with Tradency Inc. in August 2014 through a third
party share allocation-based capital increase program
Through this capital alliance, Invast Securities (“the Company”) and Tradency Inc. (“Tradency”) (*) will co-develop a higher-quality new
selective FX trade system “New ST24 (tentative name)” by combining the former’s accumulated service operations know-how acquired
through its selective automatic FX trading service “ST24,” the main business of the firm, with the latter’s highly advanced technologicalexpertise.
In addition, after completing the co-development, the Company and Tradency plan to provide the “New ST24 (tentative name)” service
to the overseas financial retail markets as a white-label service through cooperating with each other.
Details of Business Alliance
The Company and Tradency have agreed to promote the following initiatives.
Both parties will consult with each other on specific policies and contents in the future.
• Joint development of “New ST24 (tentative name)”• Global white label monopoly sales of “New ST24 (tentative name)”
Details of Capital Alliance
The Company acquired 271,038 shares of classified Tradency stock (US$4.6 million in acquisition value, and 14.99% of the total
number of shares outstanding of Tradency) through the latter’s third party allocation-based capital increase program.
With Tradency being an unlisted company, its share price was determined through having a third-party institution-based share pricecalculation performed and taking our investigation results into consideration.
(*) Tradency, the Company’s “ST24” system provision partner, is a financial technology provider delivering innovative trading solutions whose development centers
are located in Israel. Tradency’s “Mirror Trader” platform is a leading selective FX system trading platform that has been introduced in more than 20 countries
around the world.

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5Concluded a capital and business alliance agreementwith Tradency Inc. (2)An outline of the capital and business alliance with Tradency
Independentenvironment

Broker A
Capital and business alliance

System use agreement

Broker BST24Co-development
Co-development
versionBroker C
Trading tool
Ordermanagement

Co-marketing

Document
preparation

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6Overseas subsidiary Invast Financial Services（IFS）◆Starting from April 2014, IFS began to offer ST24 trading service to overseas customers

海外事業（ＩＦＳ）預かり証拠⾦推移（豪ドル）◆With its monthly customer transaction volume having exceeded the 1 million-contract mark,IFS achieved single-month profitability in the 14th month after business launch◆IFS recorded an amount equivalent to 91 million yen in net operating revenue for the second quarterof the fiscal year ending March 2015 (not recorded for the same quarter a year ago)
◆The balance of deposited margin as of June 30, 2014 stood at an amount equivalent to 1,028 millionyen◆IFS conducted a capital increase of A$2.54 million in October 2014 to make its paid-in capital
A$9 million in view of a further expansion of its business operations◆IFS’s diverse current customer base in South East Asia consists of customers based in Singaporeand China and that in the eurozone comprises those based in the U.K. and France while that in otherregions is composed of those based in South Africa and British Virgin Islands.
(A$)$12,000,000.00$10,000,000.00$8,000,000.00$6,000,000.00$4,000,000.00$2,000,000.00$0.00
Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
2013
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20147

Automated FX Trading “ST24”◆The number of strategies incorporated is over 8,000, the largest in the world,*1 supported by a step-by-step addition of new proprietary strategies◆The number of trading accounts exceeded the 70,000 mark (as of September 30, 2014). This is the largest among mirror trader providers in Japan. *2◆On the other hand, trading volume and deposited margin balance struggled to grow, affected by the reduced advertising costs and a low volatility market◆Concluded a capital and business alliance agreement with Tradency Inc. in August 2014
Invast Securities and Tradency are planning to co-develop a higher-quality service “New ST24 (tentative name)”, following which they will provide this service offering as a white-labelservice* The Mirror Trader, developed by Israel’s Tradency Inc., is the most prominent platform for selective FX system trading, and has been introduced in more than 20countries worldwide* Strategies refer to trading programs incorporated into trading platforms.
*1 Among all mirror trader providers (as of November 13, 2013; based on a Tradency survey)*2 Among all mirror trader providers in Japan (as of January 16, 2014; based on a Tradency survey)

80,000
Number of customer accounts

70,00060,00050,00040,00030,00020,00010,000

OctNovDecJanFebMar
AprMayJunJulAugSepOct
Nov
Dec
JanFebMar
AprMayJunJulAug
Sep
Oct
Nov
Dec
JanFebMar
AprMayJunJulAug
Sep
Oct02011

2012

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2014

8

Launched the new “TriAuto” service◆Launched on March 10, 2014 “TriAuto,” a new auto-pilot-based discretionary FX margin trading service (*began to accept account opening applications fromcustomers, starting from February 15, 2014)◆This is a new type of FX trading service that allows the trader user to decide on his/her trading direction while the auto-pilot automatically does the rest of thetrading process◆An innovative FX trading service offering based on a combination of the advantages of discretionary FX trading and automatic trading services◆With the TriAuto service, the user customer does what humans are good at such as predicting of market trend and formulation of strategy. Meanwhile, the auto-pilot(system) performs what humans are not good at such as entry settlement and risk management◆Well-developed risk management function◆Launched on June 9, 2014 two new functions: “Quick Shikake” and demo game “BACK TO THE SOBA”◆The total number of customer accounts for the TriAuto service exceeded the 15,000 mark (as of September 30, 2014), this service offering struggled to grow,affected by the reduced advertising costs and a low volatility market◆Aiming to expand our customer bases by stepping up advertising costs

18,000
Number of customer accounts

16,00014,00012,00010,000
8,000
6,000
4,000
2,000
0FebMar

AprMay JunJul

Aug Sep

OctNov

2014

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9Earnings metrics
ＥＢＩＴＤＡ(Millions of yen)

FY ended March 2012
[Non-consolidated]

FY ended March 2013
[Non-consolidated]

FY ended March 2014
[Consolidated]

FY ended March 2015
[Consolidated]

1Ｑ

2Ｑ

3Ｑ

4Ｑ

1Ｑ

1Ｑ

2Ｑ

Net income before taxes

176

79-18-45

100

Extraordinary income/loss

80-1-0Interest expense000

Depreciation

5460

EBITDA

222

139

2Ｑ

3Ｑ

4Ｑ

1Ｑ

2Ｑ

3Ｑ

4Ｑ

3Ｑ

0158

389

471

49 3,528

6474132300-13

24-0 3,635

132

542

470

0000000000066

70

69

6976

93

9193

102

98111

114

48

24146

69

235

497538143-4-26 -383

574Ｑ

600
EBITDA

Note: EBITDA was calculated by the formula of: Net

400

income before taxes – extraordinary income/loss +200

Interest expense + Depreciation = EBITDA. This

0represents an income metric that illustrates what level-200of cash flow was generated by capital including-400

borrowed capital-600
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q
FY ended Mar FY ended Mar FY ended Mar FY ended Mar
2011
2012
2013
2014

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Corporate GuidanceInvast Securities Co., Ltd. (as of September 30th 2014)■ Company name:■ Head office:■ Established:

August 10, 1960

■ Paid in capital:

5,965,080,000 yen■ Market listing:

JASDAQ (Code: 8709) (*1) Listed on March 6, 2006

■ President:

President and CEO Takeshi Kawaji■ Employees:

54 [Non-consolidated]
69 [Consolidated]■ Licenses:

Financial Instruments Business Operators (Type 1/ Type 2)
Director-General of Kanto Local Finance Bureau (Kinsho) No. 26■ Membership:Tokyo Financial ExchangeINVAST SECURITIES CO., LTD.
NBF Toranomon Building
1-6-21 Nishishinbashi, Minato-ku, Tokyo Japan

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11