TKC FINANCE GUARANTEE CO.,LTD. (E04780) Stock Price

TKC Financial Guarantee is a financial services company specializing in members of the TKC National Association—composed of tax accountants and certified public accountants nationwide—and their client companies. The company's primary business is computer equipment leasing, and it also provides financial-related services including automatic collection service arrangements and used asset purchase brokerage.

The company's main customers are tax accountants and certified public accountants who are members of the TKC National Association, as well as their affiliated companies. Revenue is primarily composed of lease payments and fees from various brokerage services. In particular, for automatic collection services, the company receives brokerage fees calculated by multiplying a fixed fee rate by the number of collection transactions.

In its core leasing business, the company operates direct leasing by purchasing computers and other equipment for customers, as well as subleasing operations in partnership with Mitsubishi UFJ Lease. Additionally, it handles leasing arrangements for production machinery, used asset purchase brokerage services, and arrangements for automatic collection of tax accountant advisory fees. The company has discontinued new business in loan guarantee services and various loan operations, with management of existing contracts now being the primary focus.

TKC Financial Guarantee has successfully advanced management reforms centered on supporting small and medium-sized enterprises, and is now focused on building an efficient revenue base. Since 2011, the company has pursued management reforms aimed at becoming a "lean company requiring minimal capital." In 2015, it implemented a significant capital reduction, decreasing its capital from 3.5 billion yen to 100 million yen. Furthermore, by 2016, the company completed shareholder capital returns through treasury stock acquisitions, successfully addressing the critical task of optimizing its financial structure.

The company's differentiation strategy centers on specialized service provision to TKC member tax accountants and certified public accountant firms. Through partnerships with affiliated financial institutions, the company hosts seminars on finance-related operations and information, and supports member firms in strengthening their financial product proposal capabilities through the introduction and arrangement of leasing services, automatic collection services, and the TKC Securities Partner Program. This specialized approach leveraging its unique network underpins the company's competitive advantage.

A major turning point in business structure came in March 2017 with the transfer of public mutual aid system operations. The company terminated its administrative delegation contract with TKC Corporate Mutual Aid Association and completely transferred public mutual aid system operations, thereby establishing a more efficient business operation structure. The company now concentrates its business on the arrangement of finance-related operations and the provision of finance-related information, advancing the simplification of its revenue structure.

In future growth strategy, the company has positioned the expansion of management advisory practice support activities for member firms as a priority area. While maintaining close cooperation with the General Incorporated Association TKC Corporate Mutual Aid Association, the company will continue providing services that contribute to the sustainability and development of member firms and their client companies. In response to changes in business content and revenue structure, the company is pursuing more efficient business operations than ever before, aiming to establish a stable revenue base.