Acom (8572) Q1 2025 earnings summary

Executive summary

• Operating revenue increased 8.9% year-over-year to ¥77.2 billion, driven by higher interest on operating loans and yen depreciation, with all core business segments contributing to growth.

• Profit attributable to owners of parent declined 1.0% year-over-year to ¥13.6 billion, reflecting higher provisions for bad debts and increased income taxes-deferred.

• Consolidated receivables outstanding rose 7.4% year-over-year to ¥2,575.9 billion, supported by strong domestic borrowing and currency effects.

• The business environment in Japan showed gradual recovery, but risks remain from international tensions and high overseas interest rates.

Financial highlights

• Operating profit grew 4.2% year-over-year to ¥26.3 billion, while ordinary profit was flat at ¥22.1 billion.

• Provision for bad debts surged 21.7% year-over-year to ¥27.6 billion, mainly due to increases at ACOM and EASY BUY.

• Financial expenses rose 28.8% year-over-year to ¥1.3 billion, with borrowings up ¥78.5 billion year-over-year to ¥608.1 billion.

• Loss on interest repayment drawdown fell 18.2% year-over-year to ¥5.7 billion; no new provision was added in Q1.

• Basic EPS was 8.70 yen, compared to 8.79 yen a year ago.

Outlook and guidance

• FY March 2025 forecast: operating revenue ¥313.5 billion (+6.4% year-over-year), profit attributable to owners of parent ¥55.6 billion (+4.7% year-over-year), and operating profit of ¥87.1 billion (+0.9% year-over-year).

• Receivables outstanding projected to reach ¥2,697.9 billion (+6.5% year-over-year) by year-end.

• Dividend per share estimated at ¥14 for FY March 2025.

• Requests for interest repayment expected to decrease by 25% year-over-year for FY March 2025.

• Management notes uncertainty in interest repayment requests and potential need for additional provisions.