Strengthening Existing Businesses and Creating New Businesses in New Zealand

「We recognize that, while consistently securing a high level of market share in the country, expanding the existing business's earnings power by broadening its scope, including expanding the business into Europe and South Asia and operating online vehicle trading sites, is important.」

「Meanwhile, in New Zealand, our traditional core market, the economy has emerged from the negative growth seen around the middle of the previous fiscal year, and signs of a recovery in personal consumption have begun to appear as a result of measures to support consumption, including gradual interest-rate cuts. However, the recovery remains underway in anticipation of further rate cuts, and it is expected to take more time to return to pre-stagnation levels. Against this backdrop, the country's used-vehicle import market has remained at around the level seen in the second half of the previous fiscal year and has not recovered to normal levels.」

「In New Zealand's used-vehicle market, imports of relatively low-priced used vehicles, which differed from consumer preferences, temporarily increased following the new government's deregulation of environmental regulations enacted last October. Together with rising prices for used vehicles from Japan, the main source of shipments, this led local dealers to take a wait-and-see approach to vehicle purchases and reduce local inventories. As a result, import volumes in the first half declined year on year.」

「We recognize that, while consistently securing a certain level of market share in the country, expanding into areas such as services for end users to further strengthen the earnings power of the existing business is an important management priority.」

「Against this backdrop, the Group's New Zealand business continued to capture demand for used vehicles against a backdrop of its recent market-share gains, and the number of vehicles sold remained solid.」

「Against this backdrop, the Group's New Zealand business continued to capture the rebound from the inventory adjustment phase, which ended in the second half of the previous consolidated fiscal year, against a backdrop of its recent market-share gains, and steadily increased the number of vehicles sold.」

「We recognize that maintaining and strengthening our earnings base and diversifying revenue sources in the country are important management priorities.」

「Against this backdrop, exports to New Zealand, the Group's main market, remained sluggish and could not be offset by increased exports to other countries because of a shortage of shipping capacity to Europe and other factors. Unit sales at ㈱日貿 in the trade segment for the nine months ended the third quarter were 31,659, down 12.1% year on year.」

「In response to the introduction of New Zealand's environmental regulations, the Clean Car Standard, the Group moved ahead with marketing to increase the proportion of environmentally compliant vehicles and has maintained its share of the New Zealand market by exporting used vehicles with lineups aligned with demand. In addition, logistics delays to New Zealand were again offset by increased exports to other countries, and ㈱日貿, the Group's core company, recorded sales of 13,652 vehicles in the first quarter of the current consolidated fiscal year, up 1.9% year on year.」

「The Group captured the sustained high level of demand for used vehicles since the second half of the previous fiscal year, while offsetting logistics delays caused by intermittent lockdowns during the year through increased exports to other countries. ㈱日貿, the Group's core company and the company within the Trading segment, recorded sales of 45,290 vehicles during the current consolidated fiscal year, a significant 48.1% year-on-year increase in units handled, partly reflecting the rebound from the abnormal situation in which logistics halted during the complete lockdown in New Zealand in the first half of the previous fiscal year.」

「Against this backdrop, over the first nine months of the current consolidated fiscal year as a whole, the recovery in demand for used vehicles that had continued since the second half of the previous fiscal year and the impact of the aforementioned lockdown were offset by increased exports to other countries. In addition, because the prior-year period was an abnormal situation in which logistics stalled due to the lockdown, ㈱日貿, the Group's core company, recorded a substantial recovery, with sales of 36,021 vehicles in the first nine months of the current consolidated fiscal year, up 81.0% year on year.」

「Against this backdrop, over the first six months of the current consolidated fiscal year as a whole, the recovery in demand for used vehicles that had continued since the second half of the previous fiscal year and the impact of the aforementioned lockdown were offset by increased exports to other countries. In addition, because the prior-year period was an abnormal situation in which logistics stalled due to the lockdown, ㈱日貿, the Group's core company, recorded a substantial recovery, with sales of 24,704 vehicles in the first six months of the current consolidated fiscal year, up 125.0% year on year.」

「The recovery in demand for used vehicles in New Zealand following the lockdown that occurred in the first quarter of the previous consolidated fiscal year continued in the first quarter of the current consolidated fiscal year. In addition, because the prior-year period was an abnormal situation in which logistics to New Zealand stalled due to the aforementioned lockdown, ㈱日貿 recorded a substantial recovery, with sales of 13,392 vehicles in the first quarter of the current consolidated fiscal year, up 316% year on year.」

「We recognize that strengthening earnings power and diversifying revenue sources in the country are important management priorities.」

「Due to the impact of the lockdown and restrictions on economic activity imposed in New Zealand as COVID-19 countermeasures, particularly the significant decline in sales volumes during the first quarter, used-car sales volumes during the cumulative third quarter of the current consolidated fiscal year fell 24.2% year on year to 19,901 vehicles.」

「Due to the lockdown imposed in New Zealand for 5 weeks from 25 March as a COVID-19 countermeasure, restrictions on economic activity that continued until early June, and another lockdown in August in Auckland, New Zealand’s largest city, used-car sales volumes during the cumulative second quarter of the current consolidated fiscal year fell 36.2% year on year to 10,979 vehicles.」

「Due to a lockdown imposed in New Zealand for 5 weeks from 25 March as a COVID-19 countermeasure and restrictions on economic activity that continued until early June, used-car sales volumes during the cumulative first quarter of the current consolidated fiscal year fell 62.1% year on year to 3,217 vehicles.」

「As noted above, revenue increased on the solid performance of the personal auto loan business and the acquisition of the rental car business, but the substantial decline in sales through “SmartBuy” resulted in revenue of ¥418 million, down 2.8% year on year.」

「Universal Rental Cars Limited completed the acquisition of the rental car business and is proceeding with its integration.」

「Through this acquisition, we believe that the Group can take over USAVE's customer base, which is focused on domestic demand in New Zealand, expand revenue and business scale by combining it with UR's ability to serve tourism demand, and achieve more efficient operations and strengthen earnings through measures such as integrating overlapping locations.」

「We recognize that expanding the scale of our operations and diversifying revenue sources in the country are important management priorities.」