Qudian Inc (QD) 2021 Q3 法說會逐字稿

Hello, ladies and gentlemen. Thank you for standing by for Qudian's Third Quarter 2021 Earnings Conference Call. (Operator Instructions) Today's conference is being recorded. I will now turn the call over to our host from Qudian. Please go ahead.

女士們，先生們，您好。感謝您耐心等待趣店 2021 年第三季度財報電話會議。 （操作員說明）正在錄製今天的會議。我現在將把電話從趣店轉給我們的主持人。請繼續。

Hello, everyone, and welcome to Qudian's Third Quarter 2021 Earnings Conference Call. The company's results were issued via Newswire Services earlier today and were posted online. You can download the earnings press release and sign up for the company's distribution list by visiting our website at ir.qudian.com.

大家好，歡迎來到趣店2021年第三季度財報電話會議。該公司的業績今天早些時候通過 Newswire Services 發布並在線發布。您可以訪問我們的網站 ir.qudian.com 下載收益新聞稿並註冊公司的分發名單。

Mr. Min Luo, our Founder, Chairman and Chief Executive Officer; and Ms. Sissi Zhu, our VP of Investor Relations, will start the call with prepared remarks, and then we will open the call to Q&A.

我們的創始人、董事長兼首席執行官羅敏先生；我們的投資者關係副總裁 Sissi Zhu 女士將以準備好的發言開始電話會議，然後我們將開始電話問答。

Before we continue, please note that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's results may be materially different from the views expressed today. Further information regarding these and other risks and uncertainties is included in the company's 20-F as filed with the U.S. Securities and Exchange Commission. The company does not assume any obligation to update any forward-looking statements, except as required under applicable law.

在我們繼續之前，請注意今天的討論將包含根據 1995 年美國私人證券訴訟改革法案的安全港條款作出的前瞻性陳述。前瞻性陳述涉及固有的風險和不確定性。因此，該公司的業績可能與今天表達的觀點存在重大差異。有關這些及其他風險和不確定性的更多信息包含在公司提交給美國證券交易委員會的 20-F 中。公司不承擔任何更新任何前瞻性陳述的義務，除非適用法律要求。

Please also note that Qudian's earnings press release and this conference call includes discussions of unaudited GAAP financial information as well as unaudited non-GAAP financial measures. Qudian's press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures. We also posted a slide presentation on our IR website, providing details on our results for the quarter. We will reference those results in our prepared remarks, but will not refer to specific slides during our discussion.

另請注意，趣店的收益新聞稿和本次電話會議包括對未經審計的 GAAP 財務信息以及未經審計的非 GAAP 財務指標的討論。趣店的新聞稿包含未經審計的非 GAAP 指標與未經審計的最直接可比的 GAAP 指標的調節表。我們還在 IR 網站上發布了幻燈片演示文稿，提供了本季度業績的詳細信息。我們將在準備好的評論中引用這些結果，但在討論期間不會引用特定的幻燈片。

I will now turn the call over to our CEO, Min Luo. Please go ahead.

我現在將把電話轉給我們的首席執行官 Min Luo。請繼續。

Hello, everyone. Thank you for joining us on today's call. Amid fast-evolving market conditions in the third quarter, we continued to execute prudent operational strategy in our cash credit business, ensuring our asset quality at a stable level. The transactions volume for our loan book business decreased sequentially by 2.1% to RMB 3.4 billion in this quarter. And our on-balance sheet loan balance decreased sequentially by 14.4% to RMB 3 billion. During the quarter, we continued to make steady progress with our WLM KIDS business. As of December 12, 2021, we had 7 centers operating in Xiamen, Fuzhou, Shanghai and Shenzhen, all delivering high-quality extracurricular activities, services and products to children and families. The ramp-up of WLM KIDS centers is slower than expected due to COVID-19 resurgence.

大家好。感謝您參加今天的電話會議。三季度，面對瞬息萬變的市場環境，我們現金貸業務繼續執行審慎的經營策略，資產質量保持穩定。本季度我們的貸款簿業務交易量環比下降 2.1% 至人民幣 34 億元。我們的資產負債表內貸款餘額環比下降 14.4% 至人民幣 30 億元。本季度，我們的 WLM KIDS 業務繼續取得穩步進展。截至 2021 年 12 月 12 日，我們在廈門、福州、上海和深圳設有 7 個中心，都為兒童和家庭提供優質的課外活動、服務和產品。由於 COVID-19 捲土重來，WLM KIDS 中心的擴張速度低於預期。

We are continuing to closely monitor ongoing COVID-19 conditions and proactively taking precautionary measures as our highest priority to ensure the safety and health of the children, families and staff in our centers. We also fully support the recent government regulatory changes announced for the supplemental learning industry and will strictly comply with the applicable regulations. Moving forward, we will continue to focus on improving the quality of our products and services, while also exploring new investment and business opportunities.

我們將繼續密切監視持續的 COVID-19 情況，並將積極採取預防措施作為我們的首要任務，以確保我們中心的兒童、家庭和工作人員的安全和健康。我們也完全支持最近政府宣布的針對補習行業的監管變化，並將嚴格遵守適用的法規。展望未來，我們將繼續專注於提高產品和服務質量，同時探索新的投資和商機。

Now I would like to turn the call over to Sissi for more details on our results.

現在，我想將電話轉給 Sissi，以了解有關我們結果的更多詳細信息。

Thank you, Min, and good morning, and good evening, everyone. Echoing Min on our loan book business, we continued to uphold rigorous standards for credit approvals in the third quarter. We focused new loan origination on better quality borrowers with stronger credit profiles, and our D1 delinquency rate continued to remain below 5% at the end of the quarter. Additionally, more than 99% of our outstanding loans balance were funded by our own capital, and our M1+ Delinquency coverage ratio remained high at 2.3x.

謝謝你，敏，大家早上好，晚上好。與 Min 對我們的貸款簿業務相呼應，我們在第三季度繼續堅持嚴格的信貸審批標準。我們將新貸款的發放重點放在信用狀況更好、質量更好的借款人身上，我們的 D1 拖欠率在本季度末繼續保持在 5% 以下。此外，我們 99% 以上的未償貸款餘額由我們的自有資金提供資金，我們的 M1+ 拖欠覆蓋率保持在 2.3 倍的高位。

Looking ahead, we will continue to prudently operate our cash loan business while simultaneously pursuing new potential growth channels. Supported by our strong balance sheet, we believe we can continue to grow our overall business and deliver sustainable value to our shareholders over the long term.

展望未來，我們將繼續審慎經營現金貸款業務，同時尋求新的潛在增長渠道。在我們強大的資產負債表的支持下，我們相信我們可以繼續發展我們的整體業務，並為我們的股東提供長期的可持續價值。

Now let me share with you some key financial results. In the interest of time, I will not go over them line by line. For a more detailed discussion of our third quarter 2021 results, please refer to our earnings press release. Our total revenues for the third quarter were RMB 347.4 million, representing a decrease of 59.1% from RMB 849.4 million for the third quarter of 2020.

現在讓我與您分享一些重要的財務結果。為了節省時間，我不會逐行介紹它們。有關我們 2021 年第三季度業績的更詳細討論，請參閱我們的收益新聞稿。我們第三季度的總收入為人民幣 3.474 億元，比 2020 年第三季度的人民幣 8.494 億元下降 59.1%。

Our financing income totaled RMB 285.5 million, representing a decrease of 41.4% from RMB 487 million for the third quarter of 2020, as a result of the decrease in the average on-balance sheet loan balance. Loan facilitation income and other related income decreased by 95% to RMB 8.8 million from RMB 177 million for the third quarter of 2020, as a result of the reduction in transaction volume of off-balance sheet loans during this quarter.

由於平均表內貸款餘額減少，我們的融資收入總計人民幣 2.855 億元，較 2020 年第三季度的人民幣 4.87 億元下降 41.4%。由於本季度表外貸款交易量減少，貸款便利收入和其他相關收入從 2020 年第三季度的人民幣 1.77 億元下降 95% 至人民幣 880 萬元。

Transaction services fee and other related income increased to RMB 20.9 million from RMB 6.6 million for the third quarter of last year, mainly as a result of the reassessment of variable consideration. Sales income and others decreased to RMB 7.3 million from RMB 139 million for the third quarter of 2020, mainly due to the decrease in sales related to the Wanlimu e-commerce platform, which we are in the process of winding down.

交易服務費及其他相關收入從去年第三季度的人民幣 660 萬元增加至人民幣 2090 萬元，主要是由於重新評估可變對價所致。銷售收入及其他從 2020 年第三季度的人民幣 1.39 億元減少至人民幣 730 萬元，主要是由於與萬里目電子商務平台相關的銷售額下降，我們正在關閉該平台。

Sales commission fee decreased by 55.5% to RMB 8 million from RMB 18 million for the third quarter of 2020 due to the decrease in the amount of merchandise credit transactions. Our cost of revenues decreased by 47.4% to RMB 104.6 million from RMB 198.8 million for the third quarter of 2020, primarily due to the decrease in costs associated with the loan book business and a decrease in cost of goods sold related to Wanlimu e-commerce platform.

由於商品信貸交易金額減少，銷售佣金費用從 2020 年第三季度的人民幣 1800 萬元減少 55.5% 至人民幣 800 萬元。我們的收入成本從 2020 年第三季度的人民幣 1.988 億元下降 47.4% 至人民幣 1.046 億元，這主要是由於與貸款簿業務相關的成本下降以及與萬里目電子商務相關的銷售商品成本下降平台。

Sales and marketing expenses decreased by 49.3% to RMB 32.9 million from RMB 64.8 million for the third quarter of last year, primarily due to the decrease in marketing promotional expenses.

銷售和營銷費用從去年第三季度的人民幣 6480 萬元下降 49.3% 至人民幣 3290 萬元，主要是由於營銷推廣費用的減少。

General and administrative expenses increased by 170.4% to RMB 157.7 million from RMB 58.3 million for the third quarter of 2020, as a result of the increase in staff salaries primarily relating to WLM KIDS business.

一般及行政費用從 2020 年第三季度的人民幣 5,830 萬元增加 170.4% 至人民幣 1.577 億元，這是由於主要與 WLM KIDS 業務相關的員工工資增加所致。

Research and development expenses decreased by 21.6% to RMB 40 million from RMB 51 million for the third quarter of last year, as a result of the decrease in staff salaries. Net loss attributable to Qudian's shareholders was RMB 94.2 million. And our non-GAAP net losses attributable to Qudian's shareholders was RMB 99 million for this quarter.

由於員工工資下降，研發費用從去年第三季度的人民幣 5100 萬元下降 21.6% 至人民幣 4000 萬元。趣店股東應占淨虧損為人民幣9,420萬元。本季度我們的非美國通用會計準則歸屬於趣店股東的淨虧損為人民幣 9900 萬元。

With that, I will conclude my prepared remarks. We will now open the call to questions. Operator, please go ahead.

至此，我將結束我準備好的發言。我們現在將開始提問。接線員，請繼續。

(Operator Instructions) Your first question comes from the line of Frank Zheng from Credit Suisse.

（操作員說明）您的第一個問題來自瑞士信貸的 Frank Zheng。

This is Frank Zheng from Credit Suisse. I have 2 questions. The first one is on the WLM KIDS program. Could you please provide more color on how many more in the pipeline maybe in the next year? And also, how is the payback period apply currently as well as the unit economics? And the second question is on cost revenue. I noticed that on sequential basis, cost revenue increased, can you maybe break down a little bit on what's driving the increase?

我是瑞士信貸的 Frank Zheng。我有兩個問題。第一個是關於 WLM KIDS 程序。您能否提供更多關於明年可能還有多少管道的顏色？此外，目前的投資回收期以及單位經濟效益如何？第二個問題是關於成本收入。我注意到在連續的基礎上，成本收入增加了，你能不能分解一下是什麼推動了增長？

Thank you, Frank. Thanks for the questions. So to address your first question with regard to our WLM KIDS business. We actually had 3 centers in operation during the third quarter and 7 centers now, there will be over 10 centers in the pipeline for next year. The performance, as we mentioned in our prepared remarks, it's not as good as we expected, because of the on and off regional COVID breakout.

謝謝你，弗蘭克。感謝您的提問。因此，要解決您關於我們的 WLM KIDS 業務的第一個問題。我們實際上在第三季度有 3 個中心在運營，現在有 7 個中心，明年將有 10 多個中心在籌備中。正如我們在準備好的評論中提到的那樣，性能不如我們預期的好，因為區域性 COVID 突破。

When we see positive COVID cases in the city, kids activity centers are the first ones to be shut down and the last ones to be opened. And therefore, our centers have been shut down for almost 2-month period during the third quarter because of COVID.

當我們在城市中看到 COVID 陽性病例時，兒童活動中心是最先關閉和最後開放的。因此，由於 COVID，我們的中心在第三季度關閉了將近 2 個月。

And once a center got closed down because of COVID, we need another 2 or 3 months to heat it up again. It's really hard to answer the question regarding to payback period and the stabilized UE because we are not in that stage yet. And our current imminent goal is to bring our centers to breakeven points as soon as possible before we do any further expansion. I hope that answers question.

一旦一個中心因為 COVID 而關閉，我們還需要 2 到 3 個月的時間來重新啟動它。很難回答有關投資回收期和穩定 UE 的問題，因為我們還沒有進入那個階段。我們當前迫在眉睫的目標是在我們進行任何進一步擴張之前盡快使我們的中心達到盈虧平衡點。我希望這能回答問題。

With regard to our cost of revenues, because we didn't provide the breakdowns in our earnings as the segment reporting is not required under certain accounting rules. But the majority of the increase of cost of revenues is because when we do the WLM KIDS business, we have to hire teachers and instructors in our centers. So their costs are in the cost of revenue. I hope that answers question.

關於我們的收入成本，因為我們沒有提供收入明細，因為某些會計規則不需要分部報告。但收入成本增加的主要原因是，當我們開展 WLM KIDS 業務時，我們必須在我們的中心聘請教師和講師。所以他們的成本在收入成本中。我希望這能回答問題。

(Operator Instructions) Thank you. As there are no further questions now, I would like to turn the call over to the company for closing remarks.

（操作員說明）謝謝。由於現在沒有進一步的問題，我想將電話轉給公司以作結束語。

So thank you, everyone, once again for joining us today. It's a very short call. If you have further questions, please feel free to contact our Investor Relations team. Thank you.

再次感謝大家今天加入我們。這是一個非常短的電話。如果您還有其他問題，請隨時聯繫我們的投資者關係團隊。謝謝。

Thank you. This concludes the conference call. You may now disconnect your line. Thank you. Thank you all.

謝謝。電話會議到此結束。您現在可以斷開線路。謝謝。謝謝你們。