Aeon Credit Service (m) Bhd. · MYX:AEONCR

Aeon Credit Service (m) Bhd — Q3 FYE19 Earnings Presentation

29 slides from Aeon Credit Service (m) Bhd's earnings presentation, Dec 20, 2018

  1. Slide 1: Q3/9M FYE19 Results Update

    Listing Board Bursa Malaysia Securities Berhad, Main Market Stock Name/ Code AEONCR/ 5139 Q3/9M FYE19 Results Update 20 Dec 2018

  2. Slide 2: Forward-Looking Statements

    Forward-Looking Statements This document has been prepared by AEON Credit Service (M) Berhad (“AEON Credit” or the “Company”) solely for the use at the presentation to analyst and fund managers. The information contained in this document has not been independently verified. No representation or warr

  3. Slide 3: Company & Market Snapshot

    Company & Market Snapshot A Distinctive Non-Bank Based Financial Service Provider Offering Easy Payment Schemes, Personal Finance Schemes, Credit Card Issuance, Insurance & Other Services Economic Indicators RM14.84 5 Share Price Regional Offices (as at 20 Dec 2018) 4.7% Gross Domestic Product  68

  4. Slide 4: Share Price Trend – YTD

    Share Price Trend – YTD AEONCR: 10.25% Outperform the FBMKLCI by FBMKLCI: -8.14% 18.39% Stock Name/Code AEONCR/5139 Market Capital RM3.72 billion Market Main Market FYE 28 February 30% - 32% Sector Financial Services Dividend Payout Ratio FYE18 – FYE19 Share Price 432,000,000 units RM 14.84 ICULS (A

  5. Slide 5: Key Highlights

    Key Highlights “Steady performance delivered post-SST. Going forward, we will continue to expand business and create value by focusing on quality growth, digitalisation and efficiency. Total Transaction & Q3 FYE19 ” Revenue PAT Financing Volume +49.5% YoY +11.6% YoY +23.5% YoY 9M FYE19 Total Transac

  6. Slide 6: Income Statement

    Income Statement 23.5% PAT grew YoY from increased transaction & financing volume, lower impairment loss on financing receivables Total Transaction & Financing Volume Revenue (RM mil) (RM mil) 348 1,488 1,304 332 995 +14.1% QoQ 312 +4.9% QoQ +49.5% YoY +11.6% YoY Q3 Q2 Q3 Q3 Q2 Q3 FYE18 FYE19 FYE19

  7. Slide 7: Balance Sheet

    Balance Sheet Remains healthy with YoY financing receivables growth Total Financing Receivables ROA ROE (RM mil) (%) (%) 8,313 4.6 23.3 4.4 3.8 7,795 +6.6% -0.2% 22.8 -0.5% QoQ QoQ QoQ 7,203 22.6 +15.4% +0.6% +0.2% YoY YoY YoY Q3 Q2 Q3 Q3 Q2 Q3 Q3 Q2 Q3 FYE18 FYE19 FYE19 FYE18 FYE19 FYE19 FYE18 FYE1

  8. Slide 8: Segmental Breakdown Summary: Q3 FYE19

    Segmental Breakdown Summary: Q3 FYE19 Total Transaction & Financing Volume (%) Total Financing Receivables (%) -0.5% -0.1% -2.7% 0.5 YoY 0.8 YoY ±0.0% YoY YoY 12.2 8.5 -4.1% YoY -0.7% 27.7 29.3 YoY +1.6% +1.3% 28.0 YoY YoY 24.9 4.2 4.3 30.5 29.1 -4.2% +0.7% -1.4% YoY +10.0% YoY YoY YoY Credit Card P

  9. Slide 9: Segmental Breakdown: Total Transaction & Financing Volume

    Segmental Breakdown : Total Transaction & Financing Volume +45.9% YoY in total, mainly from Personal, Motorcycle & Auto Financing Supported by sales from new products & schemes introduced for M40 customers 453 411 379 370 YoY QoQ 345 Segment 336 333 (%) (%) 316 287 320 Credit card +30% +8% 235 Perso

  10. Slide 10: Segmental Breakdown: Total Financing Receivables

    Segmental Breakdown: Total Financing Receivables +15.4% YoY in total, mainly from Personal, Motorcycle & Auto Financing As a result of improved customer mix & bad debt recovery 2,418 2,345 2,211 2,262 2,399 YoY QoQ 2,160 2,243 Segment 2,069 2,132 2,306 (%) (%) 2,048 2,095 1,902 1,934 1,960 Credit ca

  11. Slide 11: Receivables Collection

    Receivables Collection Stable collection ratio Derived from the strengthening of new receivable quality & collection operation Receivables Collection Trend 100.00 97.34 97.58 97.85 97.60 90.00 81.89 82.42 83.39 82.44 80.00 71.08 71.66 70.98 70.00 69.00 60.00 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 FYE17 FYE17

  12. Slide 12: Net Credit Cost

    Net Credit Cost Annualised Net Credit Cost Ratio reflects quality receivables Net Credit Cost (NCC) Trend 90 3.32 3.73 3.56 3.31 3.28 3.43 3.43 3.27 4 80 70 1.70 2.19 2.08 3 60 2 50 1 40 30 0 47 61 51 42 55 62 61 50 32 52 39 20 -1 10 0 -2 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 FYE17 FYE17 FYE17 FYE17 FYE1

  13. Slide 13: Non-performing Loans

    Non-performing Loans Well-managed NPL Due to collection improvement from new transactions & bad debts Non-performing Loans (NPL) Trend 12,000 4 2.74 2.48 2.48 2.43 2.33 2.28 2.43 2.33 2.26 3 2.07 2.05 10,000 2 8,000 1 6,000 0 4,000 -1 2,000 -2 5,825 6,069 6,362 6,591 6,832 7,046 7,203 7,319 7,508 7,

  14. Slide 14: Key Activity Updates

    JEON Key Activity Updates

  15. Slide 15: Key Action: Business Settlement Expansion

    Key Action: Business Settlement Expansion AEON E-Wallet & E-Money card launched on 8 Nov 2018 Cashless solution readily implemented at all Aeon retail outlets nationwide As at 20 Dec 18 No. of Store Kiosk AEON Co (include Maxvalu) 40 30 AEON Big 22 22 AEON Wellness 62 0 AEON Mall Tenant 75 0 【Grand

  16. Slide 16: Key Action: Business Settlement Expansion

    Key Action: Business Settlement Expansion Integrating with a wide range of business partners to enhance AEON’s eco-system & provide privilege to our customers Telecommunications Airline Petrol AEON Co(M) ACS AEON BiG E-Commerce Transportation Mobil e Food & Beverage Finance Public Transportation Exp

  17. Slide 17: Key Action: Products Targeting M40 Customers

    Key Action: Products Targeting M40 Customers Launched risk based pricing for Personal & Super Bike Financing Personal financing - risk based pricing Superbike financing – risk based pricing Low interest for used car (selected model) New financing category Expanding by introducing customised products

  18. Slide 18: Key Action: MFRS 9

    Key Action: MFRS 9 Continually manage each element to improve Credit cost MFRS 139 (previously used model) : Incurred Loss Model Outstanding Default (RM) Rate (%) MFRS 9 : Expected Credit Loss Model Outstanding EAD (%) PD (%) LGD (%) (RM) Exposure Probability Loss Given at Default of Default Default

  19. Slide 19: MFRS 9 (cont’d)

    Key Action: MFRS 9 (cont’d) FYE19’s key focus on new receivables quality YoY sales collection showed improvement New Sales Collection Ratio Credit Card Hire Purchase Personal Financing 99.80% 98.50% 98.50% 99.60% 99.40% 98.00% 98.00% 99.20% 97.50% 99.00% 97.00% 97.50% 98.80% 96.50% 97.00% 98.60% 96.

  20. Slide 20: Key Action: Geographical Expansion

    Key Action: Geographical Expansion 【AEON Credit Service India Private Limited】 【AEON Credit Service (Philippines) Inc.】 ・Expand Tricycle Loan financing, ・Introduced instant approval mobile app ・Introduced Auto Financing, Personal Financing : improve TAT 1-3 min ・Expand new Financing product ・AEON Cr

  21. Slide 21: Taxation: Appeal Status Update

    Taxation: Appeal Status Update No Item Remark Status i. Filed a Notice of Appeal (Form Q) • The Company had filed a • The appeal is pending the on 4 Jan 2018 notice of appeal to dispute the fixing of hearing date by additional assessments Special Commissioners of Income Tax. ii. Judicial Review – Le

  22. Slide 22: Appendices

    JEON Appendices

  23. Slide 23: Performance Highlights

    Performance Highlights Q3 Q2 Q3 QoQ YoY 9M 9M YoY (RM’000) FYE18 FYE19 FYE19 (%) (%) FYE18 FYE19 (%) Total Transaction & 995,137 1,304,029 1,484,807 13.9 49.2 3,075,000 3,887,000 26.4 Financing Volume -Credit Card 315,799 378,597 410,949 8.5 30.1 585,676 714,599 22.0 -Easy Payment 475,539 592,628 62

  24. Slide 24: Financial Summary

    Financial Summary (RM’000) Q3FYE18 Q2FYE19 Q3FYE19 QoQ (%) YoY (%) Credit Card (CC) 610,653 662,514 701,654 5.9 14.9 -Card Purchase 542,680 596,744 636,963 6.7 17.4 -Cash Advance 67,973 65,770 64,691 -1.6 -4.8 Personal Financing (PF) 1,901,521 2,095,048 2,329,273 11.2 22.5 Objective Financing (OF) 4

  25. Slide 25: Operating Income

    Operating Income Q3 Q2 Q3 QoQ YoY 9M 9M YoY (RM’000) FYE18 FYE19 FYE19 (%) (%) FYE18 FYE19 (%) Credit Card 29,112 28,629 30,392 6.2 4.4 85,483 87,450 2.3 Personal Financing 85,577 97,664 108,848 11.5 27.2 250,106 298,476 19.3 Objective Financing 29,754 25,968 24,298 -6.4 -18.3 90,727 77,738 -14.3 Mo

  26. Slide 26: Expenses

    Expenses Q3 Q2 Q3 QoQ YoY 9M 9M YoY (RM mil) FYE18 FYE19 FYE19 (%) (%) FYE18 FYE19 (%) - Impairment Loss 86.5 95.2 61.5 -35.4 -28.9 253.7 213.8 -15.7 on Receivables - Personnel 53.2 58.5 62.7 7.2 17.9 150 169.8 13.2 Expenses - Other Operating 49.7 58.3 69.6 19.4 40.0 146.6 186.9 27.5 Expenses Operat

  27. Slide 27: Financial Indicators

    Financial Indicators (RM mil) FYE16 FYE17 FYE18 Q3FYE18 Q3FYE19 PBT 302 351 398 95 118 PAT 228 265 300 71 87 Weighted average no. of ordinary shares 144 248 200(2071) 233 (2381) 250 (2541) (mil unit) Basic/(Diluted) EPS1 (RM) 1.49 1.01 1.15/(1.12) 28.74/(28.21) 33.35/(32.62) NTA per share (RM) 5.45

  28. Slide 28: Dividend

    Dividend Consistent dividend commitment 1H FYE18 1H FYE19 Interim Single Tier Dividend 21.13 sen/ share 22.25 sen/ share Dividend Payout RM52.245mil RM55.566mil Dividend Payout Ratio 35.5% 32.0% 28

  29. Slide 29: THANK YOU

    Head Office Investor Relations Contact Level 18, UOA Corporate Tower, Mr Lee Kit Seong Avenue 10, The Vertical, Chief Financial Officer Bangsar South City, leeks@aeoncredit.com.my No. 8, Jalan Kerinchi, 03-2772 9000 59200 Kuala Lumpur. Mr Yuya Narita Website : www.aeoncredit.com.my Head of Investor

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