eGuarantee (8771) Q4 2026 earnings summary

Executive summary

• Achieved financial results in line with forecasts for FY ended March 31, 2026, marking 24 consecutive years of net sales and profit growth and 19 consecutive years of meeting ordinary profit targets.

• Guarantee obligations reached a record JPY 911.3 billion, with a 40.3% year-over-year increase, driven by new contracts and productivity-focused demand.

• The company is expanding into new domains such as loan guarantees and embedded finance, leveraging proprietary big data and AI.

• Dividend payout policy shifted to target a 100% payout ratio, with increased frequency of dividend payments.

• Delays in achieving medium-term sales and profit targets, but expects to meet ROE/ROIC goals by FY2028.

Financial highlights

• Net sales rose 7.9% year-over-year to JPY 11,029 million; operating profit increased 1.9% to JPY 5,201 million; ordinary profit up 1.9% to JPY 5,303 million; net income up 2.8% to JPY 3,590 million.

• EPS grew 6.6% to JPY 78; basic EPS was JPY 77.89, diluted EPS JPY 77.08.

• Gross profit margin declined to 73.2% (down 3.3 pts), mainly due to higher reinsurance rates and guarantee payouts; gross profit increased 3.3% to JPY 8,073 million.

• Operating profit margin was 47.2%, payout ratio was 51.4%.

• Total assets declined 11.0% to JPY 29,398 million; net assets fell 15.0% to JPY 22,424 million.

Outlook and guidance

• FY2027/3 forecast: net sales to rise 7.9% to JPY 11,900 million, operating profit up 5.7% to JPY 5,500 million, net income to JPY 3,800 million (+5.9%), and EPS to reach JPY 84.

• Targeting 25th consecutive year of net sales and profit growth, with continued expansion of sales resources and new contract acquisition.

• Medium-term plan aims for consolidated net sales of JPY 20 billion and ordinary profit of JPY 10 billion by FY ending August 2028, though progress is delayed by 1–1.5 years.

• Dividend forecast for FY2027: JPY 84.00 per share, targeting a payout ratio of ~100%.

• Management will focus on prudent risk management, AI-driven efficiency, and expanding sales partnerships.