Aeon Financial Service Co., Ltd. · TSE:8570
Aeon Financial Service — FY2024 Earnings Presentation
42 slides from Aeon Financial Service's earnings presentation, Apr 10, 2025
Slide 1: FY2024 IR Presentation Material
This is an abridged translation of the original Japanese document and is provided for informational purposes only. If there are any discrepancies between this and the original, the original Japanese document prevails. *This material reflects the data as of the date of the 4th quarter IR presentation
Slide 2: Agenda
Agenda １ Outline of Financial Results for FY2024 ２ Initiatives to Enhance Corporate Value Forecast of Business Performance and 3 Dividends for FY2025 Appendix AEON Financial Service Co., Ltd. 2
Slide 3: Financial summary
Financial summary Financial performance remains steady for the full year Record operating revenues in all three Global Areas Successful improvement in asset profitability Performance remained steady Consolidated operating revenue increased by double digits (YoY 110%), consolidated operating profit e
Slide 4: The Highlights of the Consolidated Results
The Highlights of the Consolidated Results • Operating revenue and operating profit increased, driven by recovery in the Domestic Business • Posted compensation expenses for fraudulent use by a special technique as an extraordinary loss Consolidated YoY Domestic YoY Global YoY Operating ¥５33.2 bn １1
Slide 5: [Domestic] Breakdown of Operating Profit
[Domestic] Breakdown of Operating Profit • Increase in credit card revenues, finance revenue, and gains on securitization exceeded increase in expenses such as bad debt-related expenses, resulting in a ¥10.6 bn increase in profit YoY （Unit ： Bn JPY） Securitization Revenue ※APF: AEON Product Finance
Slide 6: [Domestic] Building a foundation for stock income
Asset Profitability [Domestic] Building a foundation for stock income Improvement • Achieved KPI ¥810.0 bn (before securitization) for balance of receivables at end of period due to steady acquisition of balance to build a strong revenue base • The implementation of the securitization of revolving c
Slide 7: [Domestic] Credit cards, E-money
Productivity [Domestic] Credit cards, E-money (Revenue growth) • The volume of payment transactions was contributed to by the Gold Card Customer Appreciation Day and the promotion of AEON Pay • The volume of cash advances handled exceeded the previous year's figure despite a decline in the market vo
Slide 8: [Domestic] Valid ID Status
Productivity ［ Domestic ］ Valid ID Status (Revenue growth) • Disclosed as “valid IDs” in line with expanding products and services • Work to expand new membership base through AEON Pay, etc. Number of valid domestic IDs Change in definition of domestic member （Unit ： million people） 36.15 mn ppl ID
Slide 9: [Domestic] Credit card・AEON Pay
Productivity [Domestic] Credit card・AEON Pay (Revenue growth) • No. of active cardholders increased by 320,000 Work to increase the no. of active cardholders and improve the utilization rate • AEON Pay steadily expanded in terms of both the no. of cardholders and locations where AEON Pay can be used
Slide 10: [Domestic] Banking Business
[Domestic] Banking Business • Winter time deposit campaign boosted YoY115%, up ¥662.2 bn from the beginning of the FY resulting in a record high • Appealing AEON's unique merits as a financial institution other than interest rates. Mortgage loan volume was at the same level as the previous FY AEON B
Slide 11: [Domestic] Control of bad debt-related expenses
Productivity ［Domestic］ Control of bad debt-related expenses (Cost control) • Bad debt expense ratio declined to less than 1% • In addition to strengthening the security system, deepened cooperation with external organizations to share the latest information and implement countermeasures Quarterly B
Slide 12: [Global] Performance Highlights by Segment
[Global] Performance Highlights by Segment • Operating revenues were record high in all three areas Operating profits also increased in the Global Business • In the accounting period (3 months), the Malay Area turned profitable and all areas increased profit Full Year Global business China Area Meko
Slide 13: [Global] China Area Performance Highlights
[Global] China Area Performance Highlights • Earnings increased due to successful responses to changes in the business environment, including the uptake of cross-border consumption demand in the north • Improved credit screening and credit in process as well as payment status management after the re
Slide 14: [Global] Mekong Area Performance Highlights
[Global] Mekong Area Performance Highlights • Although the economic environment requires continued attention, transaction volume increased due to new credit cards and used car loans • Operating revenue increased despite higher personnel expenses and bad debt- related expenses Breakdown of operating
Slide 15: [Global] Malay Area Performance Highlights
[Global] Malay Area Performance Highlights • In addition to the mainstay installment sales finance, volume and balance of personal loans increased, and revenue grew 125% YoY • Despite bad debt-related expenses associated with an increase in the balance of receivables and expenses associated with the
Slide 16: [Global] Balance of Receivables and NPL of Listed Subsidiaries
[Global] Balance of Receivables and NPL of Listed Subsidiaries ACSA: The no. of bankruptcies in the whole market remains high, but the ratio of bad debt-related expenses is stable AEONTS: The NPL ratio decreased due to the sale of delinquent loans, and the ratio of bad debt-related expenses has decr
Slide 17: Initiatives to Enhance Corporate Value
Initiatives to Enhance Corporate Value AEON Financial Service Co., Ltd. 17
Slide 18: Positioning of the mid-term management plan “Second Foundation”
Positioning of the mid-term management plan “Second Foundation: Value Chain Innovation and Network Creation” Our purpose is to bring “finance” closer to everyone. By committing to each and every person, we brighten up everyday lives with peace of mind and smiles. ～FY2020 FY２０２１～202５ FY2026～ The Goal
Slide 19: [Review of business portfolio] Initiatives
[Review of business portfolio] Initiatives •Continue to promote a review of the business portfolio with the aim of enhancing corporate value •Decided to transfer the 85.1% share of AEON-Allianz Life Insurance (a life insurance business) to Meiji Yasuda Life Insurance Co. ～ FY2020 FY２０２１ to FY202５ fr
Slide 20: Partnership with Meiji Yasuda
Partnership with Meiji Yasuda • Meiji Yasuda signs a comprehensive partnership agreement with AEON to expand value offered to customers • Utilize the management resources of both parties to mutually send customers and provide new products and services. New value co-creation Joint operation of throug
Slide 21: Approach to ROE Improvement
Approach to ROE Improvement 【Repost】 ROE Return on Operating Existing Improve Assets Number of (%) Receivables high-yield bond ment valid IDs + × Operating Revenue / Outstanding Receivables New Products Utilization × +α rate × Fee Amount Productivity used for (%) Revenue each product Net Income / Op
Slide 22: ROE improvement: Progress of initiatives in FY2024
ROE improvement] Progress of initiatives in FY20２4 • ROE was 4.2% (YoY -0.5 pt). There is a gap with the target level, and it is urgent to recover to the growth trajectory • To improve “valid IDs”, “usage rates” and “usage amounts”, which contribute to improving asset profitability and productivity,
Slide 23: Expansion of AEON Living Zone
Expansion of AEON Living Zone 【Repost】 FY2023 IR Presentation Material • To be an infrastructure that connects communities, member stores, and business partners by providing financial services that are rooted in the community in each country where we operate • Build an AEON Living Zone that creates
Slide 24: Building touchpoints starting with a digital wallet (smartphone)
Building touchpoints starting with a digital wallet (smartphone) • Starting with the familiar point of contact of the digital wallet (smartphone app), we will expand our customer base and promote cross-selling of various financial services by creating a seamless usage environment Expansion of busine
Slide 25: [Domestic] Customer experience starting with AEON Pay
［Domestic] Customer experience starting with AEON Pay • Consolidate the WAON Value Issuer Business※, expand the customer and member store networks, and strengthen regional collaboration • Work to create new shopping experiences and expand the infrastructure centered on AEON Pay A merger of Creating
Slide 26: [Global] Expansion of the AEON Living Zone of life and group synergy
[Global] Expansion of the AEON Living Zone of life and the realization of group synergy • Further strengthening collaboration, such as by starting a common point system with local AEON Group companies in each country where we operate Hong Kong ・ ACSA and AEON Stores (Hong Kong), which operates retai
Slide 27: Initiatives related to human resources
Initiatives related to human resources • Regarding “human resources”, which are becoming increasingly important in a changing environment, we will accelerate our efforts to develop a foundation that makes the very best use of our people and supports their growth Our purpose is to bring “finance” clo
Slide 28: Earnings and Dividend Forecasts
Earnings and Dividend Forecasts AEON Financial Service Co., Ltd. 28
Slide 29: KPI for FY2025
KPI for FY2025 • Aiming to achieve sustainable improvement in ROE through increased asset profitability and productivity resulting from the expansion of the AEON Living Zone KPI for domestic Policy Indicator Target for 2025 “AEON Living Zone” expansion Locations where AEON Pay can +1 million to real
Slide 30: FY2025 earnings forecast, dividend forecast
FY2025 earnings forecast, dividend forecast （Unit ： JPY） Consolidated YoY Domestic YoY Global YoY Operating ５70.0 bn １０7 ％ 330.0 bn １０5 ％ 240.0 bn １０8 ％ Revenue Operating 57.0 bn ９３ ％ 1９.0 bn ８5 ％ ３９.０ bn １０1 ％ Profit Ordinary Payout 57.0 bn 91 ％ Dividend per － ー share － ー Profit ratio Interim： ２５ P
Slide 31: [Our Purpose]
［Our Purpose］ AEON Financial Service Co., Ltd. 31
Slide 32: Appendix
Appendix AEON Financial Service Co., Ltd. 32
Slide 33: FY Ending February 2025 Q4 (3 months) Consolidated Financial Highlights
FY Ending February 2025 Q4 (3 months) Consolidated Financial Highlights Consolidated YoY Domestic YoY Global YoY Operating 144.4 bn １11 ％ 86.6 bn １08 ％ ５8.4 bn １１6 ％ Revenue Operating 23.5 bn 9８ ％ 10.0 bn 82 ％ 13.3 bn 114 ％ Profit Ordinary 23.6 bn 98 ％ － ー － ー Profit Profit attributable to 5.7 bn 48
Slide 34: Consolidated Balance Sheet
Consolidated Balance Sheet （Unit ： Bn JPY） FY 202４ FY 202４ Full Year Results YTD Full Year Results YTD Cash and deposits 814.7 +149.2 Deposits 5,206.2 +667.8 Accounts Operating Loans 988.9 +70.1 payable-trade 317.8 +49.2 Loans and bills Interest-bearing discounted for 2,670.4 +331.2 debt 1,309.2 ▲ 3
Slide 35: Results by Segment
Results by Segment （Unit ： Bn JPY） Domestic Global Consol. China Mekong Malay Retail Solutions Total ※1 Total ※1 Area Area Area Total ※１ Operating 313.1 193.3 192.5 222.5 35.5 95.7 91.1 533.2 Revenue YoY 107％ 1１2％ 101％ 115％ 116％ 107％ 125％ 110％ Operating 22.2 10.5 9.8 38.7 9.3 16.0 13.4 61.4 Profit Y
Slide 36: Results by Area
Results by Area Transaction Operating (Unit ： Bn JPY） YoY receivables YTD volume (Before securitization) Credit card 7,863.5 106% １,86０.4 +144.0 credit card shopping 7,492.5 106% 1,432.5 +128.4 Domestic （of which, revolving and installment) - - 361.5 ＋50.7 cash advance 371.0 1０0% 427.9 +15.5 Housing
Slide 37: Cumulative Results of Overseas Listed Companies (Local Currency)
Cumulative Results of Overseas Listed Companies (Local Currency) FY 2023 FY 2024 Full Year Results Full Year Results YoY AEON Revenue 1,６２３,３２１ 1,７５９,３１６ １0８% CREDIT SERVICE Profit before tax ４７２,５２８ ４７６,８１６ １０１% (ASIA) HK$’000 Profit for the period ３９２,2７０ ４００,４７８ １０2% AEON Revenue 21,965,263 22,10
Slide 38: Cumulative Results of Overseas Listed Companies (Yen conversion)
Cumulative Results of Overseas Listed Companies （Yen conversion） FY 202３ FY 202４ (Unit ： Bn JPY） Full year Full Year Exchange rates YoY Results Results Revenue 29.6 34.4 116% AEON （JPY / HKD） CREDIT Profit before tax 8.6 9.3 108% ・ FY202３ Q4 ： ¥18.29 SERVICE ・ FY202４ Q4 ： ¥19.57 (ASIA) 109% Profit f
Slide 39: Transaction Volumes and Operating Receivables of Global Business
Transaction Volumes and Operating Receivables of Global Business China Area Mekong Area Malay Area Global Business (Hong Kong) (Thailand) (Unit ： Bn JPY） YoY YoY YoY YoY (Change) (Change) (Change) (Change) Transaction volume 265.9 1２0% 344.8 116% 79.8 130% 690.6 119% Credit card Operating Receivable
Slide 40: Allowance for Doubtful Accounts and Provision for Loss on Interest Repayment by Segments
Allowance for Doubtful Accounts and Provision for Loss on Interest Repayment by Segments [Allowance for Doubtful Accounts ] （Unit ： Bn JPY） Domestic Global Consol. China Mekong Malay Retail Solutions Total Total Area Area Area Total Opening balance of allowance for doubtful ５５.６ 3.０ 53.０ ６４.３ ４.７ ３５
Slide 41: [Global] Environment by area
[Global] Environment by area •In Malaysia, private consumption has been strong, and the minimum wage has been increased since February •Meanwhile, in Hong Kong, domestic demand has been declining and the no. of personal bankruptcy applications has remained high, and in Thailand, GDP growth has stagn
Slide 42: Forward-looking statements
Statements contained in this report with respect to the Company’s management strategies, business policies and results forecasts are forward- looking statements about the future performance of the Company, which are based on the assumptions and beliefs in light of the information currently available
AEON Financial Service — FY2024 Earnings Presentation on 6ix