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Important FAQ

Q1

Please give us an overview of your financial results for the first quarter of fiscal year ending March 31, 2019.

Q2

Please give us a consolidated outlook for the fiscal year ending March 31, 2019.

Q3

Please give us your view on dividends.



Q1

Please give us an overview of your financial results for the first quarter of fiscal year ending March 31, 2019.

A1

The AIFUL Group’s consolidated operating revenue for the first quarter of the fiscal year ending March 31, 2019 rose 14.3% compared with the corresponding period of the previous fiscal year, to 27.6 billion yen. The principal components were 15.6 billion yen in interest on operating loans (up 19.5% year on year), 3.9 billion yen in revenue from the credit card business (up 0.5% year on year) and 3.3 billion yen in revenue from the credit guarantee business (up 3.0% year on year). Also, the collection from purchased receivable was 0.3 billion yen (down 5.1% year on year) and the recovery of loans previously charged off were 1.5 billion yen (up 10.3% year on year).
Operating expenses increased by 3.0 billion, or 13.3%, compared with the corresponding period of the previous fiscal year, to 26.2 billion yen, chiefly due to 2.3 billion yen, or 38.1% increase of provision of allowance for doubtful accounts compared with the corresponding period of the previous fiscal year, to 8.6 billion yen.

As a result, AIFUL Group posted operating profit of 1.4 billion yen (up 34.0% year on year) and ordinary profit of 1.7 billion yen (up 44.2% year on year). Profit attributable to owners of parent stood at 1.8 billion yen (down 6.9% year on year), reflecting a loss attributable to non-controlling interests of 0.1 billion yen.

Q2

Please give us a consolidated outlook for the fiscal year ending March 31, 2019.

A2

In the industry to which the AIFUL Group belongs, the number of new contracts at major players remained stable, and the operating loan balance increased moderately. On the other hand, interest repayment claims, industry’s biggest risk, still require close monitoring even though they have declined significantly from their peak and the downward trend became more apparent in current fiscal year.

In this environment, while dealing with interest repayment claims, the AIFUL group will continue working to expand operating assets on a group-wide basis and diversify the financial services business, to manage its business with an emphasis on balancing safety, profitability and growth.

In the fiscal year ending March 31, 2019, AIFUL Group expects to operating revenue of 115.4 billion yen (up 0.0% year on year), operating profit of 16.4 billion yen (up 558.1% year on year), ordinary profit of 16.9 billion yen (up 498.7% year on year), and profit attributable to owners of parent of 15.6 billion yen (up 294.1% year on year) which remain unchanged from the earnings forecast announced on May 14, 2018. However, in the business environment that surrounds the Company, there are various risks and, in particular, the trends of claims for interest repayments remain uncertain. Therefore, the final results may differ from this forecasts.

Q3

Please give us your view on dividends.

A3

The return of profits to shareholders is a management priority at the AIFUL Group. The Group's basic policy calls for a consistent return of profits in line with business results. The Group aims to maximize shareholder returns and shareholder value while simultaneously securing stable internal reserves through medium to long-term profit growth.
However, the demand for funds for interest repayments remains heavy and severe. Distributable amount remains decline. For this reason, the Group sincerely regrets that it will not pay a dividend for the fiscal year under review.

The AIFUL Group has been dealing with the principal management issue of interest repayment claims. At the same time, it is taking measures to diversify the financial business and increase operating assets to bolster its revenue base, and also work to diversify funding channels. The Group is also determined to return to the basic policy outlined above by improving its financial position and profitability.
The AIFUL Group asks all of its shareholders for their understanding and cooperation in these endeavors.

AIFUL has adopted the following provisions in its Articles of Incorporation: "The Company may determine dividends of surplus, etc. with a resolution of the Board of Directors pursuant to the provisions of Article 459, Paragraph 1 of the Companies Act" and "the Company may pay interim dividends with a resolution of the Board of Directors with September 30 each year as the record date."