Acom Co., Ltd. · TSE:8572

Acom — FY March 2008 Earnings Presentation

35 slides from Acom's earnings presentation, May 9, 2008

  1. Slide 1: Earnings Release Conference, Fiscal Year Ended March 2008

    Earnings Release Conference Fiscal Year Ended March 2008 ACOM CO., LTD. http://www.acom.co.jp/ir/english/ May 9, 2008

  2. Slide 2: Conference Schedule

    Conference Schedule May 9, 2008 Duration Title Presenter Page (Approx.) 1. Financial Results Summary 6- Shigeyoshi 2. Measures Taken during the FY March 2008 Kinoshita 20min. 8- President & CEO 3. Outlook and Policy for the FY March 2009 17 - 1. Analysis for the FY March 2008 Takashi Kiribuchi 21 -

  3. Slide 3: Financial Results Summary

    Financial Results Summary Fiscal Year Ended March 2008 Shigeyoshi Kinoshita President & CEO

  4. Slide 4: Drastically Changing Environment

    Drastically Changing Environment ‹ Understanding on Current Environment Macro and Industrial Environment 9 The number of requests for interest repayments reaching a plateau 9 Enforcement of the Money-lending Business Law (tightening regulations and self-regulatory rules) 9 Acceleration of corporate

  5. Slide 5: Revision of Money-lending Business Law

    Revision of Money-lending Business Law (schedule of enforcement) ‹Proclamation of Revised Money-lending Business Restriction Law on December 20, 2006 1st Enforcement 2nd Enforcement 3rd Enforcement 4th Enforcement (Main Enforcement) (Complete Enforcement) (2007.01.20) (2007.12.19) (by 2009.6) (by 20

  6. Slide 6: Financial Results Summary (1)

    Financial Results Summary (1) Consolidated Non-consolidated FY March 2008 Compared to Compared to Result yoy Result yoy forecast forecast (millions of yen) (%) (millions of yen) (%) (millions of yen) (millions of yen) Operating income 379,706 -10.4 6,206 317,116 -14.5 8,016 Operating expenses 298,05

  7. Slide 7: Financial Results Summary (2)

    Financial Results Summary (2) FY March 2008 FY March 2007 Non- Non- Consolidated Consolidated consolidated consolidated Net income 35,406 33,518 -437,972 -439,463 (millions of yen) Shareholders’ 24.9% 27.9% 22.2% 23.8% equity ratio 100 yen 100 yen Dividend per share (Interim: 50 yen) (Interim: 70 ye

  8. Slide 8: Group Management Reformation

    Group Management Reformation ‹Cost reduction is making a smooth progress Reduction of “Other Operating Expenses” excluding Financial, Bad-debt- related, and Interest-repayment-related Expenses 9Aiming for reduction of 40 billion yen compared to the FY March 2006 9Reduction to 87 billion yen at the F

  9. Slide 9: Reduction in Lending Interest Rate

    Reduction in Lending Interest Rate Purpose 9Attracting new customers from other segments 9Expansion of service for existing customers Untill June 17, 2007 From June 18, 2007 From March 31, 2008 913.140 27.375 912.00 18.00 97.7 18.0 FY March 2009 FY March 2007 FY March 2008 (Forecast) Average loan yi

  10. Slide 10: Situation of the Allowance for Loss on Interest Repayments

    Situation of the Allowance for Loss on Interest Repayments ‹Views on Allowance for loss on interest repayments 9Requests for interest repayments: Estimates the number to remain in plateau in FY March 2009 and may begin decreasing from third quarter of FY March 2009 9Sum of interest repayments and AC

  11. Slide 11: Loan Business (Consolidated)

    Loan Business (Consolidated) (Millions of yen) 2008/3 2009/3 (Forecast) yoy % yoy (%) Receivables outstanding 1,480,917 -151,393 -9.3 1,375,100 -7.1 ACOM 1,318,781 -175,617 -11.8 1,214,200 -7.9 DC Cash One 81,161 -1,536 -1.9 81,600 0.5 49.7 -3.3 EASY BUY* 74,735 24,817 72,300 (33.3) (16.5) No. of cu

  12. Slide 12: Credit Card and Installment Sales Finance Businesses (Consolidated)

    Credit Card and Installment Sales Finance Businesses (Consolidated) (Millions of yen) 2008/3 2009/3 (Forecast) yoy % yoy (%) Credit card business Card shopping receivables 38,126 -6,715 -15.0 30,200 -20.8 ACOM 37,682 -6,585 -14.9 30,000 -20.4 AFRESH CREDIT 443 -122 -21.6 200 -54.9 No. of cardholders

  13. Slide 13: Guarantee Business (Consolidated)

    Guarantee Business (Consolidated) (Millions of yen) 2008/3 2009/3 (Forecast) yoy % yoy (%) Guaranteed receivables 120,639 14,661 13.8 172,400 42.9 ACOM 100,633 3,783 3.9 135,300 34.4 DC Cash One 20,005 10,878 119.2 37,100 85.5 Tie-up Partners of ACOM 9 Hokkaido Bank, Hiroshima Bank, Suruga Bank, Jur

  14. Slide 14: Loan Servicing Business

    Loan Servicing Business (Millions of yen) 2008/3 2009/3 (Forecast) yoy % yoy (%) IR Loan Servicing Operating income 17,026 3,198 23.1 17,200 1.0 Collection of purchased receivables 15,568 2,240 16.8 - - Receivables outstanding 30,638 4,850 18.8 22,300 -27.2 No. of accounts for purchased loan 227,587

  15. Slide 15: New Overseas Business

    New Overseas Business ‹Addition to consolidated subsidiaries PT. BANK NUSANTARA PARAHYANGAN Tbk. Bank BNP 9Concluded a share purchase transaction on December 17, 2007 with The Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU) (ACOM: Approximately 55.4%, BTMU: 20%) 9A TOB for the remaining shares by ACOM was

  16. Slide 16: Progress in Business Alliance with MUFG

    Progress in Business Alliance with MUFG ACOM’s standing at the MUFG 9No change as the core of consumer finance business in the MUFG group Major progress in FY March 2008 9November 5, 2007: started the guarantee business for “BANQUIC”, unsecured consumer loans provided by BTMU 9December 17, 2007: con

  17. Slide 17: Outlook for the FY March 2009

    Outlook for the FY March 2009 (Millions of yen, %) Consolidated Non-consolidated Forecast yoy Forecast yoy Operating Income 325,000 -14.4 258,300 -18.5 Operating Expenses 270,400 -9.3 208,700 -11.9 Financial Expenses 24,800 18.7 17,100 7.3 Bad-debt-related Expenses 104,300 -10.0 89,200 -11.5 Other O

  18. Slide 18: Basic Policy on Profit Distribution and Dividend for the FY March 2009

    Basic Policy on Profit Distribution and Dividend for the FY March 2009 ‹Basic policy on profit distribution Goal of return to shareholders 9Based on the targeted shareholders’ equity ratio, aims at maintaining no less than 30% net income ratio against the total amount of treasury stock purchased, pl

  19. Slide 19: Acquisition of Trust Beneficiary Rights to Emission Credits

    Acquisition of Trust Beneficiary Rights to Emission Credits ‹April 22, 2008: The Nikkei 19

  20. Slide 20: Financial Results for the FY March 2008 & Outlook for the FY March 2009

    Financial Results for the FY March 2008 & Outlook for the FY March 2009 Takashi Kiribuchi Chief General Manager & Chief IR Officer Public Relations Department

  21. Slide 21: Financial Results Summary

    Financial Results Summary Consolidated Non-consolidated FY March 2008 Compared to Compared to Result yoy forecast Result yoy forecast (millions of yen) (%) (%) (millions of yen) (millions of yen) (millions of yen) Operating income 379,706 -10.4 6,206 317,116 -14.5 8,016 Operating expenses 298,054 -4

  22. Slide 22: Analysis for Operating Income Upward (ACOM)

    Analysis for Operating Income Upward (ACOM) Non-consolidated FY March 2008 Compared to Result yoy forecast (Millions of yen) (%) (millions of yen) Operating income 317,116 -14.5 8,016 Interest on loans receivable 292,860 -14.6 6,960 Average loan yield (Unsecured loan for consumers) 21.05 p.p. -1.20

  23. Slide 23: Analysis for Operating Expenses Downward (ACOM)

    Analysis for Operating Expenses Downward (ACOM) Non-consolidated FY March 2008 Compared to Result yoy forecast (Millions of yen) (%) (millions of yen) Operating expenses 236,956 -48.5 -8,444 Financial expenses 15,944 -5.8 -1,056 Bad-debt-related expenses 100,760 -21.9 -24,640 Interest-repayment-rela

  24. Slide 24: Analysis for Net Income Downward (ACOM)

    Analysis for Net Income Downward (ACOM) Non-consolidated FY March 2008 Compared to Result yoy forecast (Millions of yen) (%) (millions of yen) Extraordinary losses 27,690 -92.1 9,790 Income taxes, deferred 15,873 - 12,873 Net income 33,518 - -6,582 Primary factors 9Extraordinary losses: occurrence o

  25. Slide 25: Allowance for Loss on Interest Repayments (ACOM)

    Allowance for Loss on Interest Repayments (ACOM) ‹Interest-repayment-related expenses (Millions of yen) 2008/3 2009/3 2007/3 Result Forecast (Forecast) Interest-repayment-related expenses 200,147 19,620 - - Interest repayments 42,266 75,981 - - Bad debt write-offs (ACOM’s voluntary waiver of repayme

  26. Slide 26: Loan Business (ACOM)

    Loan Business (ACOM) (Millions of yen) 2008/3 2009/3 (Forecast) yoy yoy % (%) Unsecured loan for consumers Receivables outstanding 1,277,879 -168,238 -11.6 1,179,700 -7.7 No. of customer accounts 2,364,664 -305,942 -11.5 2,168,300 -8.3 No. of new loan customers 175,859 -92,851 -34.6 205,000 16.6 Len

  27. Slide 27: Transitions of Lending Ratio (ACOM)

    Transitions of Lending Ratio (ACOM) ‹Unsecured loan for consumers 50,000 50.0% 47.9% 48.0% 40,000 46.0% Monthly lending 44.0% ratio (right axis) 30,000 42.0% 40.4% No. of application Addition of 40.4% (left axis) 39.6% 40.0% new low-risk 39.4% customer 37.5% segments 39.3% 20,000 38.0% 36.0% 10,000

  28. Slide 28: Transitions of No. of New Loan Customers (ACOM)

    Transitions of No. of New Loan Customers (ACOM) ‹No. of application and new loan customers for unsecured loan for consumers 600,000 500,000 400,000 358,570 339,567 329,814 300,000 268,710 205,000 200,000 175,859 No. of application 100,000 No. of new loan customers 0 '04/3 '05/3 '06/3 '07/3 '08/3 '09

  29. Slide 29: Unsecured Loans Receivable Outstanding by Interest Rate (ACOM)

    Unsecured Loans Receivable Outstanding by Interest Rate (ACOM) ‹Unsecured loan for consumers (Based on Receivable outstanding) (Millions of yen, %) 2007/3 2008/3 2009/3 (Forecast) % % % Loans receivable outstanding 1,446,117 100.0 1,277,879 100.0 1,179,700 100.0 Over 18.000% 1,210,241 83.7 786,517 6

  30. Slide 30: Bad Debts (ACOM)

    Bad Debts (ACOM) ‹Changes in bad debts and composition ratio to loans receivable outstanding (Millions of yen) 150,000 10.0% 9.44% 9.54% Loans to borrowers 9.37% 9.44% 9.30% in bankruptcy or under reorganization 9.0% 120,000 Loans in 8.0% arrears 90,000 Composition ratio 7.0% 6.85% (right axis) 60,0

  31. Slide 31: No. of Loan Business Outlets and Employees (ACOM)

    No. of Loan Business Outlets and Employees (ACOM) ‹Changes in the No. of loan business outlets and employees 2,100 4,500 4,096 4,238 1,800 3,911 4,000 1,500 1,318 1,461 1,726 1,670 1,552 1,526 3,500 1,200 Unstaffed (left axis) 3,000 2,956 2,774 900 2,730 2,500 600 No. of employees Staffed (right axi

  32. Slide 32: Funds Procurement (ACOM)

    Funds Procurement (ACOM) (Millions of yen, %) 2007/3 2008/3 2009/3 (Forecast) C.R. yoy C.R. yoy C.R. yoy Borrowings 888,587 100.0 -56,621 774,407 100.0 -114,180 735,000 100.0 -39,407 Indirect 580,627 65.3 -33,661 514,407 66.4 -66,220 495,000 67.3 -19,407 Direct 307,960 34.7 -22,960 260,000 33.6 -47,

  33. Slide 33: Assumptions on the Outlook for the FY March 2009 (ACOM)

    Assumptions on the Outlook for the FY March 2009 (ACOM) 1. Outlook for the Long-term Prime Rate 2.85% 2. Average Nominal Interest Rate 1.99% 3. Average Loan yield 18.84% (Unsecured Loan for Consumers 19.09%) 4. Financial Expenses 17,100 million yen 5. Bad debt-related Expenses 89,200 million yen 6.

  34. Slide 34: Question and Answer

    Question and Answer

  35. Slide 35: Reference

    Reference ‹ For further information and questions regarding this presentation, please contact: Investor Relations Office Tel: +81-3-5533-0631 email: [email protected] ‹ For updated company information, please refer to our website: http://www.acom.co.jp/ir/english/ 35

Acom — FY March 2008 Earnings Presentation on 6ix