Management Discussion and Analysis for the 3rd Quarter 2022
Ended November 30, 2022
AEON Thana Sinsap (Thailand) Public Company Limited (“the Company”) has already submitted theconsolidated reviewed the 3rd quarter financial statements as of November 30, 2022 which were reviewed by
Deloitte Touche Tohmatsu Jaiyos Audit Company Limited. The operating performance is summarized are asfollows.
Overview
According to the Bank of Thailand and Office of the National Economic and Social Development Board
data, the Thai economy in the third quarter of 2022 expanded by 4.5% (y-y) accelerating from 2.5% in the lastquarter which was in line with relaxation of the COVID-19 situation. In addition, the supporting factors were therecovery of tourism and the continuously expanded both of private consumption and investment. However,economic expansion remains at risk due to higher cost of living, the rising of household debts amid an upward
trend of interest rates, the increasing of interest rate, and risk of emergence of new COVID-19 variants. In order
that, the unemployment rate stood at 1.23% in the third quarter of 2022 decreased from the previous quarter.
The company performance of the first nine-months of 2022, the Company has total sales increase by
29% y-y. In the third quarter of 2022, the Company has total sales increased by 17% y-y and 0.1% q-q.
As of November 30, 2022, the Company has total cards as below;
Number of AEONTS Cards and Networks

November 30, 2021

November 30, 2022

Number of Credit Cards (million cards)
Number of Member Cards (million cards)
Branches
Bangkok
Province
ATMs (machine)

3.05
6.31
100 branches
30%70%
401

3.23
6.47
104 branches
30%70%
148

6,381

6,038

Affiliated DealersSummary of Consolidated Financial Results
1. Operating Results
Profit and Loss Statement (Consolidated)
Consolidated
Unit : Million Baht
3Q/22 %YoY 9M/21 9M/22 %YoY

Separated
9M/21 9M/22 %YoY

Credit card income
Loan income
Hire-purchase income
Other income

1,960
2,589
254
1,016

17%
-0.3%
-7%
54%

4,820
7,796
805
2,177

5,648
7,847
774
2,511

17%
1%
-4%
15%

4,761
7,664
240
2,206

5,535
7,771
186
2,453

16%
1%
-22%
11%

Total Revenues
Operating and administrative expenses
Expected credit loss
Finance costs
Other expenses
Total Expenses
Profit before tax income
Income tax expenses
Net profit for the period
Earnings Per Share (Baht per share)

5,820
2,039
1,884
475
0
4,398
1,421
286
1,104
4.42

12%
5%
6%
12%
0%
6%
35%
35%
35%
35%

15,597 16,780
5,846 6,057
5,011 5,298
1,327 1,381
8
2
12,192 12,739
3,405 4,041
768
815
2,643 3,122
10.57 12.49

8%
4%
6%
4%
-71%
4%
19%
6%
18%
18%

14,872 15,945
5,217 5,502
4,265 5,167
1,385 1,436
8
110,875 12,107
3,997 3,838
731
728
3,266 3,109
13.06 12.44

7%
5%
21%
4%
-87%
11%
-4%
-0.4%
-5%
-5%

Revenues
For the first nine-months of 2022, the total consolidated revenues were 16,780 million baht,
increasing of 1,183 million baht or 8% y-y. In the third quarter of 2022, the Company recorded revenue at 5,820
million baht increased 608 million baht or 12% y-y and 6% q-q. This is the result of continued growth in corebusiness revenues especially in credit card increased by 17% y-y, which in line with increasing of card
purchase and cash advance were 32% and 24% respectively. In the third quarter of 2022, the Company has
gain on sales of written off account receivables of 299 million baht.
However, our revenue from bad debt recovery for the first nine-months of 2022 were 1,202 million baht
grew by 18% y-y and for the third quarter of 2022 was 406 million baht increased by 7% y-y but decreased by
1% q-q respectively. Details of each business can be described as follows:2

Sales and Revenues Structure for the first nine-months of 2022- Credit Card
For the first nine-months of 2022, credit card sales accounted for 70% of total turnovers with revenueof 5,648 million baht, an increase of 828 million baht or 17% y-y. In the third quarter of 2022, credit card revenue
was 1,960 million baht, an increase of 284 million baht, which was 17% y-y and 4% q-q. For overseas business,
AEON Specialized Bank (Cambodia) Plc had credit card revenue of 114 million baht, grew by 31% y-y.
- Loans
For the first nine-months of 2022, loans shared 22% of total turnovers with the revenue of 7,847
million baht, which was 47% of total revenues, increased of 51 million baht or 1% y-y. In the third quarter of2022, loans revenue was 2,589 million baht, a decrease of 8 million baht or 0.3% y-y and 1% q-q. Moreover,loan income from AEON Specialized Bank (Cambodia) PLC of 157 million baht, decreased by 22% y-y and
AEON Microfinance (Myanmar) Company Limited of 11 million baht, decreased by 63% y-y respectively.
The Company has been expanding more online service channels to customers and reduced theCompany’s operation cost such as the number of ATMs machine and operational areas in the Company’sbranches. In addition, a variety of online transaction channels have resulted in the Cardless transactions
currently accounted for 95% of total personal loan sales, which Promptpay service shared more than 70% of
total personal loan sales.
- Hire Purchase
The Company offers motorcycle, used car hire purchase, electrical appliance, mobile phones andothers and hire purchase business of overseas subsidiaries. For the first nine-months of 2022, hire purchaserevenues recorded at 774 million baht, decreased by 31 million baht or 4% y-y. In the third quarter of 2022,
the Company had hire purchase revenues of 254 million baht, decreased by 20 million baht or 7% y-y but
increased 0.3% q-q. In addition, hire purchase income in the nine-months of FY2022 from AEON Specialized
Bank (Cambodia) Plc of 504 million baht, increased by 5% y-y and AEON Leasing Service (Lao) Company
Limited of 84 million baht, which was at the same level as last year.

3

- Others
For the first nine-months of 2022, other incomes were 2,511 million baht or 15% of total revenues,
showing an increase of 334 million baht or 15% y-y, mainly consist of bad debt recovery was 1,202 million baht
or 18% y-y and represented 7% of total revenues, gain on sales of written-off receivables were 404 million baht,increased by 27% y-y or 2% of total revenues, collection service income was 166 million baht, increased by
7% y-y or 1% of total revenues, commission income was 517 million baht, increased by 4% y-y or 3% of total
revenues and others of 221 million baht. The increasing of other revenues was mainly from the continued
growth of bad debt recovery caused by the increased of expedite the legal process.
In the third quarter of 2022, other incomes were 1,016 million baht, increased by 53% y-y and 42%
q-q. In addition, the Company recorded the other incomes from gain on sales of written-off receivables at theamount of 299 million baht in this quarter as well.
Expenses
The Company’s expenses mainly consist of operating and administrative expenses, expected credit
loss and finance cost. In the first nine-months of 2022, the Company had total consolidated expenses of 12,739
million baht, an increase of 547 million baht or 4% y-y. For the third quarter of 2022, the consolidated expenses
were 4,398 million baht, an increasing of 241 million baht or 6% y-y and 2% q-q. Details of expenses are shownas follows:- Operating and Administrative Expenses
In the first nine-months of 2022, the consolidated operating and administrative expense were
6,057 million baht, increased by 212 million baht or 4% y-y. The increase in operating and administrative
expense was mainly from personal expense, administrative, and marketing activities. For the third quarter of2022, the consolidated operating and administrative expenses were 2,039 million baht increased by 88 million
baht or 5% y-y and 3% q-q. However, the Company still maintained effective operating cost control with cost
to income ratio at 35% of total revenues. Considering the Company’s separate financial statement, theoperating and administrative expenses as a percentage of revenues represented 33% and 36% in the firstnine-months of 2022.
- Expected Credit Loss
The consolidated expected credit loss in the first nine-months of 2022 amounted to 5,298
million baht, increased by 6% y-y. For the third quarter of 2022, the Company recorded expected credit lossof 1,884 million baht, increased by 6% y-y and 2% q-q.
- Finance Cost
The Company recorded consolidated finance cost in the first nine-months of 2022 of 1,381
million baht, increased by 4% y-y. For the third quarter of 2022, the finance cost was 475 million baht, increasedby 12% y-y and 1% q-q, which the portion of finance cost in the third quarter of 2022 was 8% of total revenues.
The average funding cost in the third quarter of 2022 was at 2.67%.

4Net Profit
For the first nine-months of 2022, consolidated operating income was reported at 4,041 million baht,
an increase of 636 million baht or 19% y-y. The Company recorded net profit of 3,122 million baht, an increaseof 479 million baht or 18% y-y, and earning per share was 12.49 baht due to the Company is focusing onmarketing through online channels and oversea business was the recovery after reopen the economy asnormal.
For the third quarter of 2022, the Company had consolidated operating income of 1,421 million baht,
an increase of 366 million baht or 35% y-y due to there is income from gain on sales of written off accountreceivables. The Company reported net profit attributed to owners of the parent of 1,104 million baht, anincrease of 289 million baht or 35% y-y and 22% q-q, and earning per share was 4.42 baht.
2. Financial Status
Statement of Financial Position
Unit : Million Baht
Accounts Receivable
Total Assets
Total Borrowing
Total Liabilities
Total Equities
ROEROAD/E Ratio

February 28, 2022 November 30, 2022
91,02890,46965,41870,205
20,264
19.2%
4.0%
3.5

95,106
96,16467,82173,84922,315
20.0%
4.5%
3.3

Total Assets
As of November 30, 2022, consolidated total assets were 96,164 million baht, an increase of 5,695
million baht or 6% from 90,469 million baht as of February 28, 2022. The main assets were attributed to theportfolio of net account receivables which shared 89% of total assets.
- Accounts Receivable
The Company has gross accounts receivable of 95,106 million baht as of November 30,2022, increased by 4% from as of February 28, 2022. The increase was attributed mainly from the domestic
turnovers by 32% y-y. This can be categorized by business type as follows: credit card receivable of 43,399
million baht, increased by 10% at the end of previous year; loans receivable of 45,982 million baht, increased
by 1% at the end of previous year; hire purchase receivable of 5,645 million baht, decreased by 4% at the endof previous year and others receivable of 80 million baht, decreased by 32% at the end of previous year
respectively.

5- Allowance for expected credit loss
As of November 30, 2022, the Company provided allowance for doubtful accounts of 10,470
million baht or 11% of total accounts receivable, comparing to that of 10,951 million baht or 12% of total
accounts receivable at the end of previous fiscal year. The delinquent account receivables for 3 months andup was 5.4%. For default receivables in credit risk (NPL Stage 3) was 5.6%. In the part of separate financial
statement, the delinquent account receivables for 3 months and up was 5.0% and default receivables in credit
risk (NPL Stage 3) was 5.3%. As at November 30, 2022, the consolidated coverage ratio of allowance for
expected credit loss to NPL (NPL Coverage ratio) was at 196%.
Liabilities
The consolidated liabilities of the Company as of November 30, 2022 totaling 73,849 million baht, an
increase of 3,644 million baht or 5% from 70,205 million baht at the end of last fiscal year. There were both
short-term and long-term borrowings totally 67,821 million baht, increased by 4% from the end of last year. The
portion of long-term borrowings was 43,935 million baht or represented 65% of total borrowings. To manage
risk that might occur from the fluctuation in currency. The Company has entered cross currency interest rate
swap contracts to hedge its debt. In addition, the Company has unused unsecured revolving credit facilities
8,150 million baht and 3,000 million baht unused committed facilities with various financial institutions which isenough to drive the Company’s operation. The Company also has the debentures totaling 1,000 million bahtthat will mature within 12 months, which the Company can issue new debentures or use a working capital torepay as scheduled.
Shareholders’ Equity
As of November 30, 2022, total shareholders’ equity amounted to 22,315 million baht, an increase of
2,051 million baht or 10% from the end of the last fiscal year. Book value to owners of the parent as of November
30, 2022 was 87.03 baht per share, increased from 79.55 baht per share as of February 28, 2022.
Debt to Equity ratio as of November 30, 2022 was at 3.3 times decreased from 3.5 times at the end of
FY2021. Return on Equity (ROE) and Return on Asset (ROA) for nine-month period of FY2022 are 20.0% and4.5%, respectively.
3Q21
3Q22
Nov’21 Nov’22
Key Financial Ratio
Net Profit Margin (%)

15.6%

19.0%

16.9%

18.6%

Interest Coverage ratio (Times)

3.5

4.0

3.6

3.9

Cost to Income (%)

37.4%

35.0%

37.5%

36.1

EPS (Baht)

3.26

4.42

10.52

12.49

As ofNovember 2021

As ofNovember 2022

Allowance for Expected Credit Loss/ Total Receivables (%)

12.3%

11.0%

NPL Coverage Ratio (%)

255%

196%

Book Value per Share (Baht)

74.8

87.0

Key Financial Ratio

6