Net Protections (7383) Q2 2025 earnings summary

Executive summary

• Upward revision to FY3/25 full-year earnings forecast driven by strong H1 results, higher late payment administrative fees, and improved delinquency rates, with internal controls and business unit efforts credited for these improvements.

• Operating profit forecast increased by JPY619mn to JPY1.7bn, gross profit up by JPY809mn to JPY10.26bn.

• Strategic additional investments planned for H2 to drive future GMV growth while maintaining profitability, with a conservative outlook for H2 due to macroeconomic uncertainties.

Financial highlights

• H1 GMV reached JPY304.7bn, up 11.3% year-over-year; total operating revenue JPY11.02bn, up 6.7% YoY.

• H1 operating profit JPY866mn, achieving 80.2% of full-year forecast; gross profit JPY4.9bn, up 33.2% YoY.

• EBITDA for H1 was JPY1.68bn, up 1,076.7% YoY.

• Administrative fees for late payments and improved delinquency rates contributed a combined JPY900 million positive swing versus the original forecast.

• SG&A expenses decreased 6.2% YoY; marketing expenses down 29.7% YoY.

Outlook and guidance

• Full-year operating profit forecast revised up to JPY1.7bn (+57.3% vs previous forecast).

• Additional JPY300mn investment in H2 focused on marketing and GMV growth, with phased effect expected from FY3/26.

• Medium-term management plan targets accelerated, with operating profit progressing nearly two years ahead of plan.

• Management expects continued solid GMV and gross profit growth in line with the medium-term plan, with profit increases anticipated next fiscal year.

• Shareholder returns remain a key focus, with future returns to be balanced against profit and investment needs.