ZENKOKU HOSHO (7164) Q3 2025 earnings summary

Executive summary

• Operating revenue for the nine months ended December 31, 2024, rose 4.8% year-over-year to ¥33,446 million, while operating profit declined 1.3% to ¥22,933 million and profit attributable to owners increased 1.6% to ¥18,160 million, driven by higher guarantee exposure and a gain on bargain purchase.

• Ordinary profit rose 0.8% year-over-year, supported by increased non-operating income from asset management and ABLs.

• The company focused on expanding its core guarantee business, entering related businesses via CVC investments, and enhancing corporate value through capital policy and human capital initiatives.

• Both the number and amount of new guarantees granted increased, despite sluggish new housing starts.

• Two industry peers were acquired, accelerating progress toward the medium-term management plan target for outstanding guarantee exposure.

Financial highlights

• Operating revenue: ¥33,446 million (+4.8% YoY); operating profit: ¥22,933 million (-1.3% YoY); ordinary profit: ¥25,310 million (+0.8% YoY); profit attributable to owners: ¥18,160 million (+1.6% YoY).

• Profit per share for the period was ¥267.31, compared to ¥260.17 in the prior year.

• Comprehensive income was ¥18,240 million, nearly flat year-over-year.

• Total assets as of December 31, 2024, were ¥467,694 million, up 0.2% from March 31, 2024.

• Net assets stood at ¥224,638 million, with a shareholders' equity ratio of 48.0%.

Outlook and guidance

• Full-year forecast for FY2024 ending March 31, 2025: operating revenue ¥55,700 million (+7.9%), operating profit ¥40,600 million (+3.8%), ordinary profit ¥43,200 million (+3.9%), profit attributable to owners ¥30,000 million (+4.2%), and profit per share ¥442.28.

• Dividend per share forecast at ¥197; share buyback of ¥7.0 billion planned.

• ROE projected at 13.0%, considering the share buyback.

• No revisions to the previously announced forecast.