KUALA LUMPUR (April 8): AEON Credit Service (M) Bhd (KL:AEONCR) posted a 10.1% increase in net profit for the fourth quarter ended Feb 28, 2025 (4QFY2025), mainly lifted by higher revenue and other income, which was boosted by bad debt recoveries.

Net profit for the quarter under review was RM130.97 million, compared with RM118.92 million a year earlier, according to the consumer financing firm in a bourse filing on Tuesday.

This is its strongest quarter since 1QFY2023, when it booked RM163.09 million in net profit.

The group declared a final single-tier dividend of 14.5 sen per share, payable on July 24. This brings total dividends for FY2025 to 28.75 sen per share, slightly higher than 28.25 sen in FY2024.

Quarterly revenue rose 14.6% year-on-year (y-o-y) to RM575 million, from RM501.6 million, underpinned by stronger loan and financing growth.

Interest expense increased to RM110.55 million, from RM96.98 million a year ago, mainly due to higher borrowings, in line with the growth in receivables. The nominal value of borrowings as at end-Feb 2025 stood at RM10.75 billion, up from RM9.13 billion a year earlier.

The non-performing loans ratio rose to 2.64% from 2.57%, AEON Credit noted, adding that corrective actions had been taken to address the increase.

The group also booked its share of losses from its 50%-owned AEON Bank for the quarter, amounting to RM22.82 million, up from RM16.58 million in the same period last year. AEON Credit jointly owns the digital bank with its Japanese parent, AEON Financial Service Co Ltd.

For the full FY2025, net profit fell 12.6% y-o-y to RM370.61 million, from RM424.02 million, mainly due to higher impairment losses and operating expenses.

This was despite revenue rising 15.3% y-o-y to RM8.41 billion, from RM7.3 billion.

Moving forward, AEON Credit aims to enhance its information technology capabilities to improve operational efficiency and build a robust ecosystem to expand customer reach.

Shares of AEON Credit gained five sen or 0.9% to close at RM5.79 on Tuesday, giving the company a market capitalisation of RM2.96 billion.