Premium Group Co., Ltd

Business Details

Comprises the credit business, which provides Auto Credit (individual installment purchase intermediation) to individual customers through automobile dealers (affiliated stores), and the Receivables Collection Service. The segment operates two methods, the "Advance Payment Method" and the "Affiliated Loan Method," with the Affiliated Loan Method forming the core of receivables balances. The company seeks to build up credit transaction volume and receivables balances through securing affiliated dealers via Car Premia Club membership and strengthening the support system by increasing back-office staff. It also promotes overseas expansion through business support provided to an equity-method affiliate in the Kingdom of Thailand.

Recent Overview

Achieved increased revenue and profit through expanded credit transaction volume and resolution of the system failure impact

In FY2026 (ending March 2026), credit transaction volume exceeded the prior period's level, driven by an increase in Car Premia Club members (paid membership for automobile dealers). The segment recovered steadily from the impact of the core system failure that occurred in the prior period, achieving improvement in the delinquency ratio as well as elimination of costs associated with responding to the system failure. Operating revenue increased significantly to ¥24,801 million (up 23.1% year on year), while an increase in funding costs due to rising market interest rates (interest expense of ¥542 million, up 229% year on year) weighed on profit, limiting operating profit growth to ¥4,735 million (up 3.6% year on year).

Key Products

Growth Drivers

• Securing automobile dealers through Car Premia Club membership and improving utilization rates among existing affiliated dealers
• Continued build-up of credit receivables balance (financial receivables): consolidated financial receivables balance at the end of FY2026 (ending March 2026) stood at ¥91,122 million (versus ¥74,719 million in the prior period)
• Improved efficiency of sales routes and paperless contracting through long-term credit handling and system utilization
• Strengthened collection framework through increased back-office staffing and collaboration with Chuo Saiken Kaishu Co., Ltd.
• Overseas expansion into Southeast Asia starting from the Kingdom of Thailand (equity in earnings of affiliates of ¥114 million, approximately 5x the prior period)
• Promotion of operational efficiency through AI utilization and IT/data strategy under the new medium-term management plan "Change & Prove 2030"

Risks

• Interest rate rise risk: increased funding costs due to rising market interest rates pressuring operating profit (interest expense of ¥542 million in FY2026 (ending March 2026), a substantial increase from ¥165 million in the prior period)
• Risk of recurrence of core system failure: although the company has recovered from the system failure in the prior period, a recurrence could raise concerns about deterioration of the delinquency ratio and incurrence of response costs
• Delinquent receivables/credit risk: increasing importance of receivables quality management amid rapid expansion of the credit receivables balance
• Competition/market risk: competition for market share amid flat trends in used vehicle registrations (up 0.4% year on year)
• Regulatory risk: responding to changes in the external business environment, including amendments to laws such as the Installment Sales Act
• Geopolitical/macro risk: impact on personal consumption and the used vehicle market from U.S. trade policy trends and rising energy prices/logistics costs due to worsening conditions in the Middle East