1H FY 2015 Consolidated Business Scale and Results
1Q

Business Scale
Results
Number of cardholders,consolidated
Domestic+560 thousand

36.71 million +1,040 thousand

24.97 million+330 thousand

25.25 million+610 thousand

4.48 million+160 thousand

4.62 million+300 thousand

Results

1Q
Results

Ordinary income

Credit businessFee businessBanking business

Overseas business

Adjustment

Total

2Q

Results

Difference fromforecast

YoY

115% -¥1.2 billion

Ordinary expenses¥73.0 billion 113% ¥63.4 billion 114% ¥147.9 billion

112% -¥6.1 billion

Ordinary profit¥12.5 billion 152% ¥13.3 billion 119% ¥25.9 billion

133% +¥4.9 billion¥7.1 billion 187%

128% +¥3.1 billion¥6.9 billion-¥28

AEON Financial Service Co., Ltd.

97% ¥14.1 billion+¥3

2

Results for the First Half of Fiscal Year 2015

YoY

37.2

Results

112%(Billions of yen)First Half Total
YoY

38.1

Results

107%

Consolidated

YoY

75.4

109%

Ordinary profit

8.2

148%

8.4

105%

16.7

123%

Ordinary Profit ratio* (%)

22.3%+5.4 pt.

22.1%-0.4 pt.

22.2%+2.4 pt.

Ordinary income

11.7

111%

12.5

116%

24.2

114%

Ordinary profit

0.8

1,055%

1.0

372%

1.9

522%

Ordinary Profit ratio* (%)

7.3%+6.5 pt.

8.5%+5.8 pt.

7.9%+6.2 pt.

Ordinary income

11.6

145%

10.2

111%

21.8

127%

Ordinary profit

0.2

+1.8

(0.4)

+0.3

(0.2)

+2.2

Ordinary Profit ratio* (%)

1.9%

－

－

－

－

－

Ordinary income

30.7

123%

31.6

114%

62.3

118%

Ordinary profit

5.7

108%

5.6

101%

11.3

104%

Ordinary Profit ratio* (%)

18.6%-2.7 pt.

18.0%

Ordinary income

(5.6)

-

(4.4)

-

(10.1)-

Ordinary profit

(2.4)

-

(1.4)

-

(3.9)

-

Ordinary income

85.6

117%

88.1

113%

173.8

115%

Ordinary profit

12.5

152%

13.3

119%

25.9

133%

Ordinary Profit ratio* (%)

14.7%+3.3 pt.

15.1%+0.8 pt.

14.9%+2.0 pt.

-2.2 pt.

18.3%-2.5 pt.

* Ordinary Profit ratio = Ordinary Profit ÷ Ordinary Income

AEON Financial Service Co., Ltd.

YoY

Consolidated Balance Sheets

Results by Segment(Billions of yen)First Half Total

Results¥85.6 billion 117% ¥88.1 billion 113% ¥173.8 billion

Dividends

1

YoY

Ordinary income

Profit attributable toowners of parent company

Results for the First Half of Fiscal Year 2015

2Q

1Q

Consolidated
Results

AEON Financial Service Co., Ltd.

Change from start of FY¥3,372.8 billion +¥130.4 billion ¥3,502.1 billion +¥259.7 billion

Finance receivables

AEON Financial Service Co., Ltd.

Change from start of FY

36.23 million

AEON Bank accounts

Results for the First Half of Fiscal Year 2015

First Half Total
Results

Results
393.4

Cash and deposits
Loans and bills discounted
Domestic

1,515.7

Consolidated

-74.2
+414

Deposits
Interest-bearing debt

Results

Change fromstart of FY

1,990.6

+27.5

749.3

-57.5

[791.9][+245.5]

Domestic

371.7

-64.1

Overseas

377.6

+6.6

[Amount securitized]

1,265.5+437[573.4][+181.5]

447.1

+30.7

255.1

-2.2

Allowance for loss on refund ofinterest received

2.9

-1.8

1,117.0

-26.4

282.7

-23.4

182.7

-0.8

[Amount securitized]
Cash advances +Small consumer loans
Overseas
Accounts receivable – installment

Change fromstart of FY[Amount securitized][212.4][+65.4]

Accounts payable － trade andother liabilities

Customers’ liabilities for
acceptances and guarantees

182.7

-0.8

Acceptances and guarantees

Allowance for doubtful accounts(50.1)-0.8

Total liabilities

3,208.3-56.1

Securities and other assets

483.9

+90

Total net assets

329.1

+4.2

3,537.5-51.9

3,537.5

-51.9

8.2%

+0.2%

7.8%

-0.3%

Total assets

Interest rate spread*

Total liabilities and net assets

Shareholders’ equity ratio(Domestic standard)*Change from previous fiscal year

Results for the First Half of Fiscal Year 2015

3

AEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 2015

4

Funding

Forecast of Results for FY 2015

• In addition to strong growth in long-term receivables, the current environment is favorable for raising long-term funds at fixedinterest rates.
• Consolidated interest-bearing debt has decreased as a result of funding from deposits and securitization of receivables.

Backdrop of Securitization of Receivables

View of Securitization of Receivables

・Strong performance of long-term receivables(housing, auto, solar power and renovationloans)

・ Long-term funds at fixed interest rates arereadily procurable.

Forecast of Results

・Ability to raise funds for long periods withlower interest rates than deposits for the termsof time deposits
・Slower economic growth, especially in China
and resource- and oil-producing countries(Billion yen)

800

・The effects of screening and credit
management efforts were delayed due to theeconomic slowdown overseas.

Consolidated Interest-Bearing Debt

(As of September 30, 2015)
Overseas

Ordinary income¥380 billion

116%

Ordinary profit¥61 billion

115%

Net income¥33 billion

108%

Net income per share¥166.09

109%

・Consolidated Interest-Bearing Debt
¥749.3 billion (-¥57.5 billion from start of fiscal year)

600－Domestic: ¥371.7 billion (-¥64.1 billion)－Overseas: ¥377.6 billion (+¥6.6 billion)

↓

400
200

Domestic

Interim

We also plan to reduce our year-end
domestic interest-bearing debt by using
deposits and securitizing receivables.

ActualDividend
forecast

0
'15/3

'15/9

AEON Financial Service Co., Ltd.

YoY

Results'16/3 (Plan)
Results for the First Half of Fiscal Year 2015

5

¥28

YoY

+¥3

Year end
Forecast¥38

AEON Financial Service Co., Ltd.

Full year

YoY

Forecast+¥3¥66

Payout ratio
YoY

YoY

Forecast+¥639.7% +0.4%

Results for the First Half of Fiscal Year 2015

6

Credit Card Business・ Number of cardholders, activity rate, affiliated merchants, screening/collection, and system

Number ofcardholders

Activity rate

・Create an organization for the
younger customer segment
・Sign-ups at Daiei stores

Key Initiatives for the Second Half

・Promotional campaigns ataffiliated merchants

Affiliatedmerchants

Screening/collection

・Use tablets to increase theefficiency of operations

・Enhanced development of UnionPay
affiliated merchants
・New unit for corporate sales

SystemAEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 2015

7

AEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 20158

Credit Card Business

Credit Card Business・ Shorten the time needed to enroll by using tablets for efficient cardholder sign-ups.
・ Reduce costs by going paperless, with all sign-ups done on tablets.
・ Introduce a camera function that can confirm identity to promote in-store completion of sign-ups.

・Develop an AEON Card smartphone app and introduce it on a trial basis.
・Offer payment, coupon delivery, confirmation of points and usage status, services, and otherfunctions via smartphone.

Rate of Applications by Tablet and Approval Time
Approval time (right axis)

8.5

90%

(Days)
Coupons

Tablet application rate (left axis)

100%

90%

8.0

7.4

Use

Benefits

Accumulate

Convenience

8

7.1
5.4

80%
73%

70%

60%

62%

80%

6

5.0
75%

4

4.0

64%
2.0

2

56% 56%

Promoting sign-ups by tablet

50%
4

5

6

7

8

9

12

0
3 (Month)

Development of Our Original App

FY2015
AEON Financial Service Co., Ltd.

9

Results for the First Half of Fiscal Year 2015

AEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 2015

10

Credit Card Business

Credit Card Business・ Create an organization for the younger customer segment by promoting Disney sign-ups and enhancing debitcard functions.
・ Maintain activity rates by offering the G.G Card and gold versions of co-branded cards.

・ Conduct cardholder sign-ups tailored to diverse AEON Group stores.
・ Use digital infrastructure to expand sign-ups in the Tokyo area, where our household share is low.

Percentage Share by Age Group40%

Nationwide
Kanto

35%

36.2%

37.3%

30%
29.4%

29.3%

Number of Stores*

UnitedSupermarket
Holdings Inc.

483

AEON Market

75

My Basket

602

20代

25%
19.4%

AEON Group Company

33.5%

AEON Debit Card

25.3%

20%
15%
9.5%
13.4%

10%
5%

6.3%

Use digital infrastructure.

0%20s
and younger

30s

AEON Financial Service Co., Ltd.

40s

50s

60s

AEON JMB Card G.G

Results for the First Half of Fiscal Year 2015

Strengthen sign-ups at Daiei andstrategic small stores.
*Number of stores as of August 201511

AEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 201512

Credit Card Business

Credit Card Business (Promotion of Installment Sales Finance Business)

・ Refined credit with data analysis in 1Q. Implemented policies for raising credit limits.
・ In 2Q, promote activity with tree analysis of credit-use characteristics.

・ Steadily expand our transaction volume by strengthening new affiliated merchant development and launchinga Web-based instant credit screening system for auto loans.
・ Continue affiliated merchant development in the second half and strengthen affiliated merchant maintenance.

(Billion yen)

Web Credit Screening System(Billion yen)

Cash advance transaction volume (left axis)

Installment Sales Affiliated Merchants and Transaction Volume(Billion yen)

Cash advances (right axis)

90(Stores)

New affiliated merchants (right axis)

400

Installment sales financetransaction volume (left axis)

400
100

85

300

380

80
200

360
75

50

Promote activity withusage analysis tree

100

340

70
Raise credit limits based on refined credit

65
0

4Q

1Q

1H

2Q

2014
AEON Financial Service Co., Ltd.

(FY)

2015

Results for the First Half of Fiscal Year 201513

AEON Financial Service Co., Ltd.

1H2015 (FY)

2014

14

・ Expand the transaction volume with the use of WAON at 12,220 Lawson convenience stores starting on December 15.
・ Strengthen the development of outside WAON affiliated merchants that use new NFC terminals; used at 225,000
locations in the first half.

E-Money Transaction Volume
WAON affiliated merchants (right axis) (Thousand(Billion yen)

E-money transaction volume (left axis) locations)

AEON Bank agency business
Flat 35

80

2500

210

200
228.1

198.6

60
Appointment for meetingat branch

2H

Results for the First Half of Fiscal Year 2015

Housing Loan Volume

100

1H

Fee Business (Strengthening E-Money Initiatives)

・In the insurance agency business, offer appointments and reception online. Promote an omni-channel approach
to applications at the branch.
・Expand housing loan applications by increasing AEON Bank housing loans, in addition to “Flat 35” loans.
(Billion yen)

2H

2013

Fee Business (Insurance Agency and Housing Loan Businesses)

Promotion of Omni-Channel Approach

0

0

320
0

3Q

2000

150

40
1500
100

20
1000

0
1H

2H
2013

1H

2H
2014

1H
2015 (FY)AEON INSURANCE SERVICEAEON HOUSING LOAN SERVICE

1H operating income ¥3.3 billion (+11% YoY)

1H operating income ¥2.7 billion (+33% YoY)

AEON Financial Service Co., Ltd.

50

500

Results for the First Half of Fiscal Year 2015

Use of WAON starting at Lawson stores

0

0

'11
15

AEON Financial Service Co., Ltd.

'12

'13

'14

'15

Results for the First Half of Fiscal Year 201516

Banking Business (In-Store Branch Business)

Banking Business (Initiatives in Human Resource Development)

・ Improve customer convenience and efficiency with digitalization initiatives.
・ Provide services tailored to regional characteristics and the needs of each customer.
Product explanation using digital signage

Details of Initiatives■ Housing loans made in the first half expanded 207% YoY due to the effect of training at training facilities.
■ Strengthening consulting capabilities in over-the-counter sales (investment trusts, insurance) in addition tohousing loans.
Average Monthly Amount of Housing Loans Made (by Quarter)

Benefits(Billion yen)・Switch to paperless processes

・Fast service－Digital signage－Saves reception andカード利用情報や金融－Acceptance of notifications via
資産情報から顧客のtablet
ニーズを分析

40400

April: Nagoya opening

Training in a branch-like environment

processing time

July: Tokyo Sept.: Osaka opening
opening

Dec.: Makuhari opening

30300

・Efficient notification－Lower printing and content
change costs

・Expansion of credit screening

centers－Shift from uniform screening toscreening based on regional

Concierge system

20200
・Improved screening speed

market characteristics－More applications processed

10100

・Better screening accuracy－Understanding of local
conditions

・Utilize customer information

00－Determine needs frominformation on attributes and

1Ｑ・Improved product proposals－ Generates list of recommended

usage

products from analysis data

AEON Financial Service Co., Ltd.

2Ｑ

Results for the First Half of Fiscal Year 201517

AEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 2015

EMV-compliant

Interest Rate Spread(Interest rate)(Billion yen)

20000
20,0002,000
Transfers

Timedeposits

Transaction
records

Settingchanges

Others

1,600
16000
16,000

6.0%

Coupon issuance

Digital signage advertising

Shopping

Ordinary
deposits

6%

6,513¥651.3億円
billion25%

1,200
12,000
12000
800
8,000
8000

Cash advancesTimedeposits¥1,336.7
billionLoans＋
Shopping
receivables¥1,812.4
billion

400
4000
4,000
00

○○○○年○月○日まで

Revolving/
Installment

Shopping
One-time
payment

20%
3%
7%
9%

4.5%
Purchasedreceivables

Corporate
loans

Share
残高構成比

Loans + Shopping receivables
貸出金＋ｼｮｯﾋﾟﾝｸﾞ

・One-time payment shopping has an APR of about 18%.
(Average affiliated merchant fee of 1.5% X 12 months)

Results for the First Half of Fiscal Year 201519

AEON Financial Service Co., Ltd.

5.0%

Unsecuredloans

Housingloans
Deposits
and finance receivables
預金および営業債権の残高

5.56%Interest rate spread
預貸金利ざや5.5%

Cashadvance30%

Deposits
預金

AEON Financial Service Co., Ltd.

18

・ Loan-to-deposit ratio of 63% due to the expansion of credit card receivables, and 91% when card shopping receivables are added
・ Balance sheet efficiency improving with the expansion of highly profitable finance receivables and the lowering of deposit costs

Finance Receivables (Including Card Shopping)

Deposits &withdrawals

1Ｑ 2Ｑ
2015 (FY)Banking Business (Balance Sheet)・ AEON Bank ATMs have the infrastructure to provide cash advances, WAON recharging andother services, in addition to banking services such as deposits, withdrawals and transfers.

WAON

4Ｑ

Monthly average now more than ¥30 billion

Banking Business (Development of the ATM Business)

Banking services

3Ｑ
2014

4.0%
3.5%
3.0%
4 6

9 12 3２０１３

6

9 12 3

6

２０１４

２０１５

9 (Month)・The yield on loans is rising due to the expansion of cash
advances.
・The yield on deposits is decreasing due to the increase of theordinary deposit ratio.

Results for the First Half of Fiscal Year 201520

Overseas Business (First-Half Initiatives of THANA SINSAP)

Overseas Business (Finance Receivables of THANA SINSAP)

・ Issued a co-branded card with a railway operator group for the purpose of acquiring cardholders among middleincome people working at offices and living along railway lines
・ In addition to boosting sign-ups in Bangkok, shifted sign-up efforts from industrial areas to major regional cities

Household Debt in Thailand

Number of Cardholders Acquired by Region
Bangkok
バンコク
Northeast
東北部(Cardholders)

Central
中央部
South
南部

・ Household debt centered on housing loans and personal loans is increasing, and financial institutions are tightening their credit
standards.
・ Recently, the delinquency of customers is improving due to the revision of credit screening standards and the strengthening ofreceivables management.

North
北部

60,00050,000201320142015 (June 30)

Amount of household debt

9.8 trillion baht

10.5 trillion baht

10.7 trillion baht

As a percentage of GDP

76%

80%

81%
Source: Bank of Thailand

40,000Years Since Customers’ Start of Credit (As of September 30)

30,00020,00010,0000
1Q 2Q 3Q 4Q 1Q 2Q

Cardholder sign-ups at Chit Lom train station

2014
AEON Financial Service Co., Ltd.

2 years or more

Less than 2 years

Less than 1 year

Finance receivables

55.0 billion baht

4.9 billion baht

2.1 billion baht

Balance of delinquentloans

1.8 billion baht

200 million baht

40 million baht

Delinquency rate

3.3%

4.1%

1.7%

2015 (FY)21

Results for the First Half of Fiscal Year 2015

AEON Financial Service Co., Ltd.

22

Results for the First Half of Fiscal Year 2015

Overseas Business (Finance Receivables of THANA SINSAP)

Overseas Business (Thailand: Enhancement of Receivables Management Operations)

・ Profit margins are improving as a result of improved yields and reduced provisions.
・ Promoting a switch from loans to credit cards

・ Introduced a new employee evaluation system, and evaluating employees every three months to allocate
them appropriately
・ Reallocating employees to delinquent receivables and external debt in the current month by raising collection
efficiency with improved classification of the current month’s receivables

Product Comparison (THANA SINSAP)
Credit Cards

HP/Specific-Purpose
Loans

Personal Loans

Bangkok Business Center

Total

Balance of Loans Entrusted by No. of Months Past Due
Currentmonth

1 monthpast due>3 months
2 months
past due andpast duein litigation

ResultChange fromprevious year

ResultChange fromprevious year

ResultChange fromprevious year

ResultChange fromprevious year

Share oftransaction
volume

49.5%

+2.1%

21.8%

-4.5%

28.8%

+2.4%

100%

-

Balance ofloans(Million baht)

54,8001,310

800

12,900Share ofoperatingrevenue

41.8%

+1.5%

18.0%

-4.8%

40.2%

+3.3%

100%

-

Number ofloans(Thousand)

3,210

70

50

99

Yield

24.9%

+0.4%

23.7% -0.46% 27.6%

+1.4%

25.7%

+0.7%

Administrative
staff

1,160

420

280

390

Provisions ÷
Receivables(beforeamortization)

5.3%

-2.1%

8.0%

+1.6%

7.7%

-0.9%

Accounts
handled perperson

2,760

170

160

-

AEON Financial Service Co., Ltd.

-2.7%

10.3%

Results for the First Half of Fiscal Year 201523

AEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 201524

Overseas Business (Business Development Centered on Thailand)(Reference) Allowance for Possible Credit Losses and Allowance for Loss on
Refund of Interest Received

・ Conducting card business, insurance agency business and servicer business in Thailand
・ Acquired a specialized bank license and began credit card business in Cambodia

・ Allowance for Possible Credit Losses (Domestic Credit Card Business)

CreditThailandCredit cards○

Installment
sales finance○

Personal
loans○

Insurance
agency○Servicerbusiness○

Leasing
Businessresources

Vietnam

Cambodia

Myanmar

Laos○

Became a specialized bank

○

○

○

○

○

Fee

○

(Billion yen)

Banking

Overseas

Total

Allowance for possible credit losses,
beginning of period

26.1

3.1

3.1

16.8

49.2

Provision for possible credit losses

6.2

7.0

1.0

16.3

23.5

Write-off of credit losses(including transferred debt)

5.7

0.2

0.0

16.6

22.6

26.6

3.6

3.2

16.5

50.1

Allowance for possible credit losses,
end of period(Domestic subsidiaries) AEON Bank: ¥3.2 billion, AEON Product Finance: ¥4.6 billion, AEON HOUSING LOAN SERVICE: ¥1.3 billion

・ Allowance for Loss on Refund of Interest Received(Billion yen)

FY 2014 1H

FY 2015 1H

Allowance for loss on refund of interest received, beginning of period

3.0

4.8

○

Provision for loss on refund of interest received

2.5

0.0

Share employee development and expertise cultivated in Thailand.

Interest refunded (Sums refunded and appropriation of interest to principal)

1.9

1.9

Allowance for loss on refund of interest received, end of period

3.6

2.9

Using business resources in Thailand to strengthen
expansion in neighboring countries

Utilize financing capability in Thailand (investment).

People/Materials
Funds
Systems

Shared modules

AEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 201525

(Reference) 1H FY 2015 Results (Hong Kong, Thailand and Malaysia)
・ Consolidated Results of AEON Credit Service (Asia) Co., Ltd.

1H FY 2014
Results

8.3
2.2
1.7

Ordinary income
Ordinary profit
Net income

116%
107%
106%

Results

Results

Exchange rates: HKD 1

YoY

9.9
2.3
1.8

119%
104%
105%

27.0
4.9
3.9

Ordinary income
Ordinary profit
Net income

1H FY 2015

YoY

115%
98%
98%

Results

YoY

31.6
5.6
4.5

117%
114%
115%

・ Results of AEON Credit Service (M) Berhad

1H FY 2014
Results・ 1H 2014: JPY 13.17
・ 1H 2015: JPY 15.66

1H FY 2015
Results

Fiscal period
・2014: Feb. 21–Aug. 20
・2015: Mar. 1–Aug. 31

Number of cardholders

Ordinary income
Ordinary profit
Net income

12.9
4.3
3.2

135%
124%
124%

25.25 million

Results
Exchange rates: THB 1
・ 1H 2014: JPY 3.15
・ 1H 2015: JPY 3.63

Card shopping transaction volume
E-money transaction volume

Fiscal period
・2014, 2015:
Feb. 21–Aug. 20¥1,986.3
billion¥1,029.6
billionResults

14.9
4.5
3.4

YoY

115%
104%
106%

Exchange rates: MYR 1・ 1H 2014: JPY 31.60
・ 1H 2015: JPY 32.43

Fiscal period
・2014: Feb. 21–Aug. 20
・2015: Mar. 1–Aug. 31

FY 2015

Change from start offiscal year

+0.61 million

YoY

Plan
26.00 million

Plan

Change from start offiscal year

+1.36 million

YoY

108.8% ¥4,200.0 billion

109.9%

108.3% ¥2,281.0 billion

114.8%

Results

Change from start offiscal year

Plan

Change from start offiscal year

Balance of cash advances¥393.0 billion+¥22.5 billion¥400.0 billion+¥29.6 billion

Balance of small consumer loans¥54.1 billion+¥8.2 billion¥80.0 billion+¥34.1 billion

Balance of unsecured loans¥447.1 billion+¥30.7 billion¥480.0 billion+¥63.7 billion(Billion yen)

1H FY 2015

YoY

26

(Reference) 1H FY 2015 Business Plan (Domestic)・ Consolidated Results of AEON THANA SINSAP (THAILAND) PLC. (Billion yen)

1H FY 2014

Results for the First Half of Fiscal Year 2015

(Billion yen)

1H FY 2015

YoY

AEON Financial Service Co., Ltd.

Note: Calculated from information released by each company

AEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 201527

AEON Financial Service Co., Ltd.

Results for the First Half of Fiscal Year 201528