AEON Credit Service (M) Bhd has reported a satisfactory performance for the six-month financial period ended Aug 31, 2026 with its net earnings inching up 3.1% year-on-year (yoy) to RM154.47 mil from RM149.78 mil in the corresponding period last year.
This was primarily driven by higher revenue attributed to stronger loan and financing growth, partially offset by higher impairment losses on financing receivables.
Revenue of the consumer financial services provider firmed 7.8% yoy to RM1.31 bil (1H FY2/2027: RM1.22 bil) while its pre-tax profit rose 1.7% yoy to RM215.74 mil (1H FY2/2027: RM212.08 mil).
The group’s transaction and financing volume for 6M FY2/2027 grew by 6.6% yoy to RM4.90 bil.
The group’s gross financing receivables expanded to RM16.53 bil as of end-August 2026, an increase of RM1.38 bil from a year ago while net financing receivables after allowance for impairment loss rose to RM15.69 bil from RM14.29 bil.
The non-performing loans (NPL) ratio stood at 2.55% from 2.49% a year earlier, mainly stemming from cost-of-living pressures affecting certain customer segments, particularly younger and lower-income groups.
AEON Credit has taken measures to address the increase while the loan loss coverage ratio stood at 199% from 228% in 1H FY2/2026.
‘Adopting cautious, prudent biz approach’
Other income for the quarter was recorded at RM57.16 mil, mainly attributable to bad debt recoveries.
The ratio of total operating expenses to revenue stood at 72.5% from70.0% in the corresponding quarter of the preceding year mainly due to a RM30.12 mil spike in impairment losses on financing receivables.
Finance costs for the group’s 2Q FY2/2027 were higher, mainly resulting from higher borrowings in line with the group’s receivables growth with the nominal value of borrowings standing at RM12.77 bil as of end-August 2026 from RM11.53 bil a year ago.
The group also equity-accounted for its proportionate share of losses in AEON Bank amounting to RM21.70 mil during the quarter under review from RM18.50 mil in the corresponding quarter of the preceding year.
Against Bank Negara Malaysia’s (BNM) projection of the Malaysian economy growing between 4.0% and 5.0% in 2026, the group continues to adopt a cautious and prudent business approach by retaining its focus “on growing quality financing assets and closely monitoring inherent credit risks within its financing portfolio”.
“The group will also continue enhancing its information technology (IT) capabilities to improve operational efficiencies and maintain disciplined cost management,” envisages AEON Credit in a media statement.
“Additionally, the group will leverage the broader AEON ecosystem in Malaysia, particularly through its 51% subsidiary, AEON360 Sdn Bhd to strengthen customer loyalty, expand its customer base and enhance the overall customer experience.”
Barring any unforeseen circumstances, the group expects to be able to sustain its business momentum through the continued implementation of appropriate strategic and operational measures for its financial year ending Feb 28, 2027.
At 11.50am, AEON Credit was down 9 sen or 1.79% to RM4.93 with 467,800 shares traded, thus valuing the company at RM2.52 nil. – Oct 1, 2026
