X Financial (XYF) 2023 Q3 法說會逐字稿

Hello and welcome to the X Financial third-quarter 2023 earnings conference call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note that this event is being recorded. I would like to turn the conference over to [Victoria Yu]. Please go ahead.

您好，歡迎參加 X Financial 2023 年第三季財報電話會議。所有參與者將處於僅聽模式。今天的演講結束後，將有機會提問。請注意，該事件正在被記錄。我想把會議交給[Victoria Yu]。請繼續。

Thank you, operator. Hello, everyone, and thank you for joining us today. The company's results were released earlier today and are available on the company's IR website at ir.xiaoyinggroup.com. On the call today from X Financial are Mr. Kan Li, President; and Mr. Frank Fuya Zheng, Chief Financial Officer.

謝謝你，接線生。大家好，感謝您今天加入我們。該公司的業績於今天稍早發布，並可在該公司的投資者關係網站 ir.xiaoyinggroup.com 上查閱。今天，X Financial 總裁李侃先生接了電話；鄭福亞先生，財務長。

Mr. Li will give a brief overview of the company's business operations and highlights, followed by Mr. Zheng, who will go through the financials. They are all available to answer your questions during the Q&A session. I remind you that this call may contain forward-looking statements under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on the management's current expectations and current market and operating conditions and relate to events that involve known or unknown risks, uncertainties, and other factors, all of which are difficult to predict and many of which are beyond the company's control, which may cause the company's actual results, performance, or achievements to differ materially from those in the forward-looking statements.

李先生將簡要介紹公司的業務運作和亮點，隨後鄭先生將介紹財務狀況。他們都可以在問答環節回答您的問題。我提醒您，本次電話會議可能包含1995 年《私人證券訴訟改革法案》安全港條款下的前瞻性陳述。此類陳述基於管理層當前的預期以及當前的市場和運營狀況，並與涉及已知或未知的風險、不確定性和其他因素，所有這些因素都難以預測，並且許多因素超出了公司的控制範圍，這可能導致公司的實際結果、業績或成就與前瞻性陳述中的結果存在重大差異。

Further information regarding these and other risks, uncertainties, and factors is included in the company's filings with the US Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required under the law. It is now my pleasure to introduce Mr. Kan Li. Mr. Li, please go ahead.

有關這些和其他風險、不確定性和因素的更多資​​訊包含在該公司向美國證券交易委員會提交的文件中。除法律要求外，本公司不承擔因新資訊、未來事件或其他原因而更新任何前瞻性聲明的義務。現在我很高興向大家介紹李侃先生。李先生，請講。

Hello, everyone, we are pleased to see that our established strategy continue to deliver strong results in the third quarter. Our loan facilitation and origination amount reached the high end of our previous guidance, and the both our top-line and bottom-line showed a substantial year-over-year improvement. During the quarter, as macroeconomic conditions improve the moderate today and the regulatory environment has stabilized, the personal finance business has returned to normal across the industry, resulting in increased competition. As a result, our [junior] to borrower acquisition costs increased quarter- over-quarter.

大家好，我們很高興看到我們既定的策略在第三季繼續取得強勁的業績。我們的貸款便利化和發放金額達到了先前指導的上限，我們的營收和利潤均同比大幅改善。本季，隨著宏觀經濟情勢溫和向好，監理環境趨於穩定，個人金融業務全行業恢復正常，競爭加劇。因此，我們的[初級]借款人收購成本較上季增加。

Our loan delinquencies fluctuated within our historical low to middle range. During the third quarter, our total loan amount have facilitated and originated increased by 49% year-over-year and a 14% quarter-over-quarter to RMB 29 billion. With the total outstanding loan balance reaching nearly RMB50 billion at the end of September 2023, our delinquency rates for all outstanding loans past due for 31 to 60 days and the 91 to 180 days, were 1.11% and 2.5%, respectively, and at the end of the quarter compared with 0.77% and 2.2%, respectively, a year ago.

我們的貸款拖欠率在歷史低至中等範圍內波動。第三季度，我們促成發放的貸款總額年增49%，較上季成長14%至人民幣290億元。截至2023年9月末，未償還貸款餘額總額接近人民幣500億元，逾期31至60天和91至180天的所有未償還貸款的拖欠率分別為1.11%和2.5%，季度末與去年同期相比分別成長0.77% 和2.2%。

We have enhanced our efforts to acquire more quality borrowers, but we expect the delinquency rates to continue to fluctuate for some time. We will maintain sales and asset quality leveraging our cutting-edge risk management system and focusing more on asset quality than on expanding our borrower base. Going forward, we will continue to execute our proven strategy and enhance our ability to drive long-term growth and returns for our shareholders. Now I will turn the call to Frank who will go through our financials.

我們加強爭取更多優質借款人，但我們預計拖欠率將在一段時間內繼續波動。我們將利用我們先進的風險管理系統來維持銷售和資產質量，並更專注於資產品質而不是擴大借款人基礎。展望未來，我們將繼續執行我們行之有效的策略，並增強我們為股東推動長期成長和回報的能力。現在我將把電話轉給弗蘭克，他將檢查我們的財務狀況。

Thank you, Kan, and hello, everyone. We are very pleased with our solid financial results in third quarter. Total net revenue increased by 56% year-over-year and a 14.5% quarter-over-quarter to RMB1,397 million. Our net income saw a remarkable 64% year-over-year increase to RMB347 million. There was a slight decline in quarter-over-quarter.

謝謝你，坎，大家好。我們對第三季穩健的財務表現感到非常滿意。淨收入總額較去年同期成長56%，較上季成長14.5%至人民幣13.97億元。我們的淨利潤年增 64% 至 3.47 億元。環比略有下降。

This decrease was primarily attributed to the rising cost of our borrowing acquisition and management asset quality risk. We remain dedicated to achieving balanced growth in revenue and earnings in the long-term, which is clearly a key driver of shareholder value. To achieve this goal, we will take a comprehensive consideration of the borrower acquisition cost and the risk control based on a close monitoring of market dynamics, to ensure that we grow both our revenues, scale, and profits in a sustainable manner.

這一下降主要歸因於我們的借貸成本上升和管理資產品質風險。我們仍然致力於實現收入和盈利的長期平衡成長，這顯然是股東價值的關鍵驅動力。為實現這一目標，我們將在密切監測市場動態的基礎上，綜合考慮借款人獲取成本和風險控制，以確保我們的收入、規模和利潤的可持續成長。

Now, I would like to brief some of the financial performance for Q3. Please note that all numbers stated are in RMB and rounded up. Total net revenue increased by 56% to RMB1,397 million from RMB895 million in the same period 2022, primarily due to an increase in the total loan amount facility, and originally, this quarter, compared with the same period of 2022. Origination and servicing expenses increased by 50% to RMB811 million from the RMB540.5 million in the same period of 2022, primarily due to the increase in borrowing acquisition cost and collection expenses, resulting from the increase in total loan amount of facility and originate this quarter compared with the same period of 2022.

現在，我想簡單介紹一下第三季的一些財務表現。請注意，所有數字均以人民幣為單位並四捨五入。淨收入總額從 2022 年同期的人民幣 8.95 億元增長 56% 至人民幣 13.97 億元，主要是由於本季度貸款總額融資較 2022 年同期增加。發起和服務費用較2022年同期的人民幣5.405億元增長50 %至人民幣8.11億元，主要是由於本季貸款總額增加導致借款取得成本及催收費用增加，與去年同期相比2022 年同期。

Provisions for the loans receivable was RMB54 million compared with RMB70 million in the same period of 2022, primarily due to an increase in loans receivable held by the company, as a result of the increase in total loan amount that facilitate and originate this quarter compared with the same period of 2022. Income from operations 2023 was RMB435 million compared with RMB300 million in the same period of 2022. Net income was RMB347 million, compared with RMB212 million in the same period of 2022. Non-GAAP adjusted net income was RMB375 million, compared with RMB 231 billion in the same period of 2022.

應收貸款撥備為人民幣 5,400 萬元，而 2022 年同期為人民幣 7,000 萬元，主要是由於本季度促成和產生的貸款總額較上年同期增加，導致公司持有的應收貸款增加。2022 年同期營業收入為人民幣4.35 億元，而2022 年同期為人民幣3 億元。淨利為人民幣3.47 億元，而2022 年同期為人民幣2.12 億元。非GAAP 調整後淨利為人民幣3.75 億元，而人民幣2.12 億元。非GAAP 調整後淨利為人民幣3.75 億元，而2022年同期為2,310億元。

For further financial information, please refer to the earnings release on our website. Regarding our share repurchase plan, in Q3, we repurchased approximately 396,000 ADS for a total consideration of the USD1.7 million. Since the beginning of 2023, we have repurchased an aggregate of approximately 802,000 ADS for a total consideration of the USD3.3 million. We have approximately USD5.6 million remaining for the potential repurchase under our current plan.

有關更多財務信息，請參閱我們網站上的收益發布。關於我們的股票回購計劃，第三季度，我們回購了約396,000股ADS，總代價為170萬美元。自2023年初以來，我們已回購了總計約802,000股ADS，總代價為330萬美元。根據我們目前的計劃，我們還有大約 560 萬美元用於潛在的回購。

Now, on our business outlook. For Q4 this year, we expect the total loan amount facilitated and originated to the between RMB26.5 billion and RMB28 billion. For fiscal year 2023, we expect a total loan amount facility and originate to be between RMB105.9 billion and RMB107.4 billion. This concludes our prepared remarks and we'd like to open the call to questions. Operator, please? Operator?

現在，談談我們的業務前景。今年第四季度，我們預計促成和發放的貸款總額將在人民幣 265 億元至 280 億元人民幣之間。 2023 財年，我們預期貸款額度和來源總額將在 1,059 億元人民幣至 1,074 億元之間。我們準備好的演講到此結束，我們想開始提問。接線員，請說？操作員？

(Operator Instructions) This time, we have no questions. Let's return the call back to Ms. Victoria Yu for closing remarks.

（操作員指示）這次，我們沒有任何問題。讓我們回電給Victoria Yu 女士做總結發言。

Thank you, everyone, for joining us on the call today. If you haven't got a chance to raise your questions, we will be pleased to answer them through follow-up contacts. We look forward to speaking with you again in the near future. Thank you.

謝謝大家今天加入我們的電話會議。如果您沒有機會提出問題，我們將很樂意透過後續聯繫予以解答。我們期待在不久的將來再次與您交談。謝謝。

Conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。

Thank you.

謝謝。