SHENZHEN, China, March 27, 2024 /PRNewswire/ — X Financial (NYSE: XYF) (the "Company" or "we"), a leading online personal finance company in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2023.
Fourth Quarter and Fiscal Year 2023 Operational Highlights
Three MonthsEnded December31, 2022
Three MonthsEnded September30, 2023
Three Months Ended December31, 2023
Twelve MonthsEnded December31, 2022
Twelve MonthsEnded December31, 2023
QoQ
YoY
YoY
Total loan amount facilitated andoriginated (RMB in million)
21,700
29,462
26,134
(11.3 %)
20.4 %
73,655
105,557
43.3 %
Number of active borrowers
1,370,496
1,809,815
1,603,760
(11.4 %)
17.0 %
3,326,774
4,495,997
35.1 %
The total loan amount facilitated and originated[1] in the fourth quarter of 2023 was RMB26,134 million, representing an increase of 20.4% from RMB21,700 million in the same period of 2022. The total loan amount facilitated and originated in 2023 was RMB105,557 million, representing an increase of 43.3% from RMB73,655 million in 2022. Total number of active borrowers[2] was 1,603,760 in the fourth quarter of 2023, representing an increase of 17.0% from 1,370,496 in the same period of 2022. Total number of active borrowers was 4,495,997 in 2023, representing an increase of 35.1% from 3,326,774 in 2022.
As of December 31, 2022
As of September 30, 2023
As of December 31, 2023
Total outstanding loan balance (RMB in million)
37,992
49,685
48,847
Delinquency rates for all outstanding loans that are pastdue for 31-60 days
1.02 %
1.11 %
1.57 %
Delinquency rates for all outstanding loans that are pastdue for 91-180 days
1.93 %
2.50 %
3.12 %
The total outstanding loan balance[3] as of December 31, 2023 was RMB48,847 million, compared with RMB37,992 million as of December 31, 2022. The delinquency rate for all outstanding loans that are past due for 31-60 days[4] as of December 31, 2023 was 1.57%, compared with 1.02% as of December 31, 2022. The delinquency rate for all outstanding loans that are past due for 91-180 days[5] as of December 31, 2023 was 3.12%, compared with 1.93% as of December 31, 2022.
[1] Represents the total amount of loans that the Company facilitated and originated during the relevant period.
[2] Represents borrowers who made at least one transaction on the Company’s platform during the relevant period.
[3] Represents the total amount of loans outstanding for loans that the Company facilitated and originated at the end of the relevant period. Loans that are delinquent for more than 60 days are charged-off and are excluded in the outstanding loan balance, except for Xiaoying Housing Loan. As Xiaoying Housing Loan is a secured loan product and the Company is entitled to payment by exercising its rights to the collateral, the Company does not exclude Xiaoying Housing Loan delinquent for more than 60 days in the outstanding loan balance.
[4] Represents the balance of the outstanding principal and accrued outstanding interest for loans that were 31 to 60 days past due as a percentage of the total balance of outstanding principal and accrued outstanding interest for loans that the Company facilitated and originated as of a specific date. Loans that are delinquent for more than 60 days are charged-off and excluded in the calculation of delinquency rate by balance. Xiaoying Housing Loan was launched in 2015 and ceased in 2019, and all the outstanding loan balance of housing loan as of December 31, 2022, September 30, 2023 and December 31, 2023 were overdue more than 60 days. To make the delinquency rate by balance comparable, the Company excludes Xiaoying Housing Loan in the calculation of delinquency rate.
[5] To make the delinquency rate by balance comparable to the peers, the Company also defines the delinquency rate as the balance of the outstanding principal and accrued outstanding interest for loans that were 91 to 180 days past due as a percentage of the total balance of outstanding principal and accrued outstanding interest for the loans that the Company facilitated and originated as of a specific date. Loans that are delinquent for more than 180 days are excluded in the calculation of delinquency rate by balance, except for Xiaoying Housing Loan. All the outstanding loan balance of housing loan as of December 31, 2022, September 30, 2023 and December 31, 2023 were overdue more than 180 days. To make the delinquency rate by balance comparable, the Company excludes Xiaoying Housing Loan in the calculation of delinquency rate.
Fourth Quarter 2023 Financial Highlights
(In thousands, except for share and per share data)
Three MonthsEnded December31, 2022
Three MonthsEnded September30, 2023
Three MonthsEnded December31, 2023
QoQ
YoY
RMB
RMB
RMB
Total net revenue
955,640
1,396,864
1,192,664
(14.6 %)
24.8 %
Total operating costs and expenses
(681,687)
(962,120)
(938,472)
(2.5 %)
37.7 %
Income from operations
273,953
434,744
254,192
(41.5 %)
(7.2 %)
Net income
274,639
347,190
188,968
(45.6 %)
(31.2 %)
Non-GAAP adjusted net income
277,939
374,507
230,782
(38.4 %)
(17.0 %)
Net income per ADS—basic
5.28
7.26
3.90
(46.3 %)
(26.1 %)
Net income per ADS—diluted
5.16
7.02
3.84
(45.3 %)
(25.6 %)
Non-GAAP adjusted net income per ADS—basic
5.34
7.80
4.74
(39.2 %)
(11.2 %)
Non-GAAP adjusted net income per ADS—diluted
5.22
7.56
4.68
(38.1 %)
(10.3 %)
Total net revenue in the fourth quarter of 2023 was RMB1,192.7 million (US$168.0 million), representing an increase of 24.8% from RMB955.6 million in the same period of 2022. Income from operations in the fourth quarter of 2023 was RMB254.2 million (US$35.8 million), compared with RMB274.0 million in the same period of 2022. Net income in the fourth quarter of 2023 was RMB189.0 million (US$26.6 million), compared with RMB274.6 million in the same period of 2022. Non-GAAP[6] adjusted net income in the fourth quarter of 2023 was RMB230.8 million (US$32.5 million), compared with RMB277.9 million in the same period of 2022. Net income per basic and diluted American depositary share ("ADS") [7] in the fourth quarter of 2023 was RMB3.90 (US$0.55) and RMB3.84 (US$0.54), compared with RMB5.28 and RMB5.16, respectively, in the same period of 2022. Non-GAAP adjusted net income per basic and adjusted diluted ADS in the fourth quarter of 2023 was RMB4.74 (US$0.67) and RMB4.68 (US$0.66), compared with RMB5.34 and RMB5.22, respectively, in the same period of 2022.
[6] The Company uses in this press release the following non-GAAP financial measures: (i) adjusted net income (loss), (ii) adjusted net income (loss) per basic ADS, and (iii) adjusted net income (loss) per diluted ADS, each of which excludes share-based compensation expense, impairment losses on financial investments, income (loss) from financial investments and impairment losses on long-term investments. For more information on non-GAAP financial measure, please see the section of "Use of Non-GAAP Financial Measures Statement" and the table captioned "Unaudited Reconciliations of GAAP and Non-GAAP Results" set forth at the end of this press release.
[7] Each American depositary share ("ADS") represents six Class A ordinary shares.
Fiscal Year 2023 Financial Highlights
Twelve Months Ended December 31,
(In thousands, except for share and per share data)
2022
2023
YoY
RMB
RMB
Total net revenue
3,562,950
4,814,884
35.1 %
Total operating costs and expenses
(2,480,657)
(3,377,202)
36.1 %
Income from operations
1,082,293
1,437,682
32.8 %
Net income
811,995
1,186,794
46.2 %
Non-GAAP adjusted net income
873,658
1,276,696
46.1 %
Net income per ADS—basic
15.42
24.72
60.3 %
Net income per ADS—diluted
15.12
24.48
61.9 %
Non-GAAP adjusted net income per ADS—basic
16.56
26.58
60.5 %
Non-GAAP adjusted net income per ADS—diluted
16.26
26.34
62.0 %
Total net revenue in 2023 was RMB4,814.9 million (US$678.2 million), representing an increase of 35.1% from RMB3,563.0 million in 2022. Income from operations in 2023 was RMB1,437.7 million (US$202.5 million), compared with RMB1,082.3 million in 2022. Net income in 2023 was RMB1,186.8 million (US$167.2 million), compared with RMB812.0 million in 2022. Non-GAAP adjusted net income in 2023 was RMB1,276.7 million (US$179.8 million), compared with RMB873.7 million in 2022. Net income per basic and diluted American depositary share ("ADS") in 2023 was RMB24.72 (US$3.48) and RMB24.48 (US$3.45), compared with RMB15.42 and RMB15.12, respectively, in 2022. Non-GAAP adjusted net income per basic and adjusted diluted ADS in 2023 was RMB26.58 (US$3.74) and RMB26.34 (US$3.71), compared with RMB16.56 and RMB16.26, respectively, in 2022.
Mr. Justin Tang, the Founder, Chief Executive Officer and Chairman of the Company, commented, "We are pleased to conclude the year with solid operational and financial results, emphasizing our commitment to sustained growth. In 2023, we facilitated and originated 43% more loans than in 2022 and delivered notable year-over-year growth in both revenue and profit. Total net revenue increased 35% on an annual basis, while income from operations increased 33%, and net income improved by 46%. However, as we entered the second half of 2023, particularly in the fourth quarter, we experienced increased risk levels in asset quality. While we strengthened our risk control system and implemented various measures to manage delinquency rates, we also made the strategic decision to proactively reduce loan volumes in the fourth quarter, prioritizing profitability over sheer volume growth."
"For fiscal year 2024, our strategic approach will remain consistent and somewhat conservative, aligning with current market conditions in China. We believe the regulatory environment has become stable, and the government is committed to promoting economic recovery. However, we recognize that challenges and uncertainties exist as the country undergoes a transformative shift in its economic growth model away from the rapid expansion of the past, and structural adjustments are imperative. All of this has far-reaching impacts on various sectors, including our targeted market. Despite these challenges, we remain committed to executing our strategy and prioritizing profitable growth. Our commitment to delivering value to shareholders is unwavering, and we intend to pay dividends as and when profitability and smooth operations allow. This overall approach reflects our dedication to navigating the evolving economic landscape while ensuring the sustainable success of our business and returning value to our shareholders."
Mr. Kent Li, President of the Company, added, "During the fourth quarter of 2023, our total loan amount facilitated and originated was RMB26 billion, a 20% year-over-year increase but an 11% quarter-over-quarter decline. Delinquency rates for loans past due for 31-60 days and 91-180 days were 1.57% and 3.12%, respectively, at the end of the quarter, compared with 1.02% and 1.93%, respectively, a year ago. Our team remains vigilant in monitoring asset dynamics and has taken further steps to mitigate risk by reducing our exposure to higher risk areas and adjusting our business approach to ensure sustainable profitability. We aim for continued gradual improvement over the course of 2024, and these measures have begun to have a positive impact on our risk indicators."
Mr. Frank Fuya Zheng, Chief Financial Officer of the Company, added, "We are pleased to deliver solid financial results in 2023. Total net revenue increased by 35% year-over-year to RMB4.8 billion, and net income rose by 46% to approximately RMB1.2 billion. In response to heightened asset quality risks in the fourth quarter, we proactively reduced loan volumes to safeguard profitability, resulting in a 15% sequential decline in total net revenue for the quarter. We recognized RMB26.9 million and RMB46.8 million of impairment losses on long-term investments related to our indirect investment in Newup Bank of Liaoning in 2022 and 2023, respectively, mainly due to the depreciation in the market valuation of the Chinese banking sector. However, the bank’s loan portfolio and operations remain healthy, and we believe it continues to be a good investment for us. Looking ahead, we will not pursue pure loan volume growth at the expense of profitability, which is always our strategic focus to ensure long-term growth and returns to shareholders. We will continue to strengthen our risk management system to improve asset quality and balance our revenue and profitability growth."
Fourth Quarter 2023 Financial Results
Total net revenue in the fourth quarter of 2023 increased by 24.8% to RMB1,192.7 million (US$168.0 million) from RMB955.6 million in the same period of 2022, primarily due to an increase in the total loan amount facilitated and originated this quarter compared with the same period of 2022.
Three Months Ended December 31,
(In thousands, except for share and per share data)
2022
2023
YoY
RMB
% of Revenue
RMB
% of Revenue
Loan facilitation service
562,137
58.8 %
615,482
51.6 %
9.5 %
Post-origination service
106,777
11.2 %
166,807
14.0 %
56.2 %
Financing income
248,639
26.0 %
307,692
25.8 %
23.8 %
Other revenue
38,087
4.0 %
102,683
8.6 %
169.6 %
Total net revenue
955,640
100.0 %
1,192,664
100.0 %
24.8 %
Loan facilitation service fees in the fourth quarter of 2023 increased by 9.5% to RMB615.5 million (US$86.7 million) from RMB562.1 million in the same period of 2022, primarily due to an increase in the total loan amount facilitated this quarter compared with the same period of 2022.
Post-origination service fees in the fourth quarter of 2023 increased by 56.2% to RMB166.8 million (US$23.5 million) from RMB106.8 million in the same period of 2022, primarily due to the cumulative effect of increased volume of loans facilitated in the previous quarters. Revenues from post-origination services are recognized on a straight-line basis over the term of the underlying loans as the services are being provided.
Financing income in the fourth quarter of 2023 increased by 23.8% to RMB307.7 million (US$43.3 million) from RMB248.6 million in the same period of 2022, primarily due to an increase in average loan balances compared with the same period of 2022.
Other revenue in the fourth quarter of 2023 increased by 169.6% to RMB102.7 million (US$14.5 million), compared with RMB38.1 million in the same period of 2022, primarily due to an increase in referral service fee for introducing borrowers to other platforms and increase in guarantee income generated from financing guarantee business operated by a subsidiary which holds the financing guarantee license and commenced the financing guarantee business in 2023.
Origination and servicing expenses in the fourth quarter of 2023 increased by 28.3% to RMB755.2 million (US$106.4 million) from RMB588.7 million in the same period of 2022, primarily due to the increase in commission fees and collection expenses resulting from the increase in total loan amount facilitated and originated this quarter compared with the same period of 2022.
Provision for loans receivable in the fourth quarter of 2023 was RMB99.4 million (US$14.0 million), compared with RMB75.4 million in the same period of 2022, primarily due to an increase both in loans receivable held by the Company as a result of the increase in total loan amount facilitated and originated this quarter and in estimated default rate compared with the same period of 2022.
Income from operations in the fourth quarter of 2023 was RMB254.2 million (US$35.8 million), compared with RMB274.0 million in the same period of 2022.
Income before income taxes and gain (loss) from equity in affiliates in the fourth quarter of 2023 was RMB211.1 million (US$29.7 million), compared with RMB382.5 million in the same period of 2022.
Income tax expense in the fourth quarter of 2023 was RMB35.7 million (US$5.0 million), compared with RMB75.0 million in the same period of 2022.
Net income in the fourth quarter of 2023 was RMB189.0 million (US$26.6 million), compared with RMB274.6 million in the same period of 2022.
Non-GAAP adjusted net income in the fourth quarter of 2023 was RMB230.8 million (US$32.5 million), compared with RMB277.9 million in the same period of 2022.
Net income per basic and diluted ADS in the fourth quarter of 2023 was RMB3.90 (US$0.55), and RMB3.84 (US$0.54), compared with RMB5.28 and RMB5.16, respectively, in the same period of 2022.
Non-GAAP adjusted net income per basic and diluted ADS in the fourth quarter of 2023 was RMB4.74 (US$0.67), and RMB4.68 (US$0.66), compared with RMB5.34 and RMB5.22 respectively, in the same period of 2022.
Cash and cash equivalents was RMB1,195.4 million (US$168.4 million) as of December 31, 2023, compared with RMB1,427.9 million as of September 30, 2023.
Fiscal Year 2023 Financial Results
Total net revenue in 2023 increased by 35.1% to RMB4,814.9 million (US$678.2 million) from RMB3,563.0 million in 2022, primarily due to an increase in the total loan amount facilitated and originated this year compared with 2022.
Twelve Months Ended December 31,
(In thousands, except for share and per share data)
2022
2023
YoY
RMB
% of Revenue
RMB
% of Revenue
Loan facilitation service
2,044,344
57.4 %
2,740,974
56.9 %
34.1 %
Post-origination service
372,451
10.5 %
596,582
12.4 %
60.2 %
Financing income
966,277
27.1 %
1,137,336
23.6 %
17.7 %
Other revenue
179,878
5.0 %
339,992
7.1 %
89.0 %
Total net revenue
3,562,950
100.0 %
4,814,884
100.0 %
35.1 %
Loan facilitation service fees in 2023 increased by 34.1% to RMB2,741.0 million (US$386.1 million) from RMB2,044.3 million in 2022, primarily due to an increase in the total loan amount facilitated this year compared with 2022.
Post-origination service fees in 2023 increased by 60.2% to RMB596.6 million (US$84.0 million) from RMB372.5 million in 2022, primarily due to the cumulative effect of increased volume of loans facilitated during the year. Revenues from post-origination services are recognized on a straight-line basis over the term of the underlying loans as the services are being provided.
Financing income in 2023 increased by 17.7% to RMB1,137.3 million (US$160.2 million) from RMB966.3 million in 2022, primarily due to an increase in average loan balances compared with 2022.
Other revenue in 2023 increased by 89.0% to RMB340.0 million (US$47.9 million), compared with RMB179.9 million in 2022, primarily due to an increase in referral service fee for introducing borrowers to other platforms and increase in guarantee income generated from financing guarantee business operated by a subsidiary which holds the financing guarantee license and commenced the financing guarantee business in 2023.
Origination and servicing expenses in 2023 increased by 34.9% to RMB2,869.8 million (US$404.2 million) from RMB2,126.7 million in 2022, primarily due to the following factors: (i) an increase in commission fees and collection expenses resulting from the increase in total loan amount facilitated and originated this year, and (ii) an increase in interest expenses as a result of an increase in payable to institutional funding partners and investors.
Provision for loans receivable in 2023 was RMB229.1 million (US$32.3 million), compared with RMB158.6 million in 2022, primarily due to an increase in loans receivable held by the Company as a result of the increase in the total loan amount facilitated and originated this year and in estimated default rate compared with 2022.
Provision for contingent guarantee liabilities in 2023 was RMB67.5 million (US$ 9.5 million) due to increase in guarantee liability arising from financing guarantee business operated by a subsidiary which holds the financing guarantee license and commenced the financing guarantee business in 2023.
Income from operations in 2023 was RMB1,437.7 million (US$202.5 million), compared with RMB1,082.3 million in 2022.
Income before income taxes and gain (loss) from equity in affiliates in 2023 was RMB1,403.1 million (US$197.6 million), compared with RMB1,223.5 million in 2022.
Income tax expense in 2023 was RMB249.4 million (US$35.1 million), compared with RMB389.4 million in 2022.
Net income in 2023 was RMB1,186.8 million (US$167.2 million), compared with RMB812.0 million in 2022.
Non-GAAP adjusted net income in 2023 was RMB1,276.7 million (US$179.8 million), compared with RMB873.7 million in 2022.
Net income per basic and diluted ADS in 2023 was RMB24.72 (US$3.48), and RMB24.48 (US$3.45), compared with RMB15.42 and RMB15.12, respectively, in 2022.
Non-GAAP adjusted net income per basic and diluted ADS in 2023 was RMB26.58 (US$3.74), and RMB26.34 (US$3.71), compared with RMB16.56 and RMB16.26 respectively, in 2022.
Cash and cash equivalents was RMB1,195.4 million (US$168.4 million) as of December 31, 2023, compared with RMB602.3 million as of December 31, 2022.
Recent Development
Share Repurchase Plan
In the fourth quarter of 2023, the Company repurchased an aggregate of 35,922 ADSs for a total consideration of US$143,400. Since the beginning of 2023, the Company had repurchased an aggregate of 837,729 ADSs for a total consideration of US$3.46 million. The Company has approximately US$5.5 million remaining for potential repurchases under our current share repurchase plan.
Declaration of Semi-Annual Dividend
The Company today announced that the Company’s board of directors (the "Board") has approved a semi-annual dividend policy. Under this policy, the determination to declare and pay such semi-annual dividend and the amount of dividend in any particular half year will be made at the discretion of the Board and will be based upon the Company’s operations and earnings, cash flow, financial condition and other relevant factors that the Board may deem appropriate.
Pursuant to the semi-annual dividend policy, the Board has approved the declaration and payment of a semi-annual dividend of US$0.17 per ADS (approximately US$0.028 per ordinary share) for the second half of 2023. The holders of the Company’s ordinary shares shown on the Company’s record at the close of trading on May 10, 2024 (U.S. Eastern Daylight Time) will be entitled to these dividends. These shareholders, including the Bank of New York Mellon, the depositary of our ADS program (the "Depositary"), will receive the payments of dividends on or about May 31, 2024. Dividends to the Company’s ADS holders will be paid through the Depositary on or after May 31, 2024, and the precise timing of receipt will vary based on the processing efficiency of the respective holding brokerage.
Business Outlook
The Company expects the total loan amount facilitated and originated for the first quarter of 2024 to be between RMB21.0 billion and RMB22.5 billion.
This forecast reflects the Company’s current and preliminary views, which are subject to changes.
Conference Call
X Financial’s management team will host an earnings conference call at 7:00 AM U.S. Eastern Time on March 27, 2024 (7:00 PM Beijing / Hong Kong Time on March 27, 2024).
Dial-in details for the earnings conference call are as follows:
United States:
1-888-346-8982
Hong Kong:
852-301-84992
Mainland China:
4001-201203
International:
1-412-902-4272
Passcode:
X Financial
Please dial in ten minutes before the call is scheduled to begin and provide the passcode to join the call.
A replay of the conference call may be accessed by phone at the following numbers until April 3, 2024:
United States:
1-877-344-7529
International:
1-412-317-0088
Passcode:
3077685
Additionally, a live and archived webcast of the conference call will be available at http://ir.xiaoyinggroup.com.
About X Financial
X Financial (NYSE: XYF) (the "Company") is a leading online personal finance company in China. The Company is committed to connecting borrowers on its platform with its institutional funding partners. With its proprietary big data-driven technology, the Company has established strategic partnerships with financial institutions across multiple areas of its business operations, enabling it to facilitate and originate loans to prime borrowers under a risk assessment and control system.
For more information, please visit: http://ir.xiaoyinggroup.com.
Use of Non-GAAP Financial Measures Statement
In evaluating our business, we consider and use non-GAAP measures as supplemental measures to review and assess our operating performance. We present the non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. We believe that the use of the non-GAAP financial measures facilitates investors’ assessment of our operating performance and help investors to identify underlying trends in our business that could otherwise be distorted by the effect of certain income or expenses that we include in income (loss) from operations and net income (loss). We also believe that the non-GAAP measures provide useful information about our core operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making.
We use in this press release the following non-GAAP financial measures: (i) adjusted net income, (ii) adjusted net income per basic ADS, and (iii) adjusted net income per diluted ADS, each of which excludes share-based compensation expense, impairment losses on financial investments, income (loss) from financial investments and impairment losses on long-term investments. These non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, investors should not consider them in isolation, or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP.
We mitigate these limitations by reconciling the non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures, which should be considered when evaluating our performance. We encourage you to review our financial information in its entirety and not rely on a single financial measure.
For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of GAAP and Non-GAAP results" set forth at the end of this press release.
Exchange Rate Information
This announcement contains translations of certain RMB amounts into U.S. dollars at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB7.0999 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of December 29, 2023.
Disclaimer
Safe Harbor Statement
This announcement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "potential," "continue," "ongoing," "targets," "guidance" and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the "SEC"), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Any statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements that involve factors, risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors and risks include, but not limited to the followings: the Company’s goals and strategies; its future business development, financial condition and results of operations; the expected growth of the credit industry, and marketplace lending in particular, in China; the demand for and market acceptance of its marketplace’s products and services; its ability to attract and retain borrowers and investors on its marketplace; its relationships with its strategic cooperation partners; competition in its industry; and relevant government policies and regulations relating to the corporate structure, business and industry. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this announcement is current as of the date of this announcement, and the Company does not undertake any obligation to update such information, except as required under applicable law.
Use of Projections
This announcement also contains certain financial forecasts (or guidance) with respect to the Company’s projected financial results. The Company’s independent auditors have not audited, reviewed, compiled or performed any procedures with respect to the projections or guidance for the purpose of their inclusion in this announcement, and accordingly, they did not express an opinion or provide any other form assurance with respect thereto for the purpose of this announcement. This guidance should not be relied upon as being necessarily indicative of future results. The assumptions and estimates underlying the prospective financial information are inherently uncertain and are subject to a wide variety of significant business, economic and competitive risks and uncertainties that could actual results to differ materially from those contained in the prospective financial information. Accordingly, there can be no assurance that the prospective results are indicative of the future performance of the Company, or that actual results will not diff materially from those set forth in the prospective financial information. Inclusion of the prospective financial information in this announcement should not be regarded as a representation by any person that the results contained in the prospective financial information will actually be achieved. You should review this information together with the Company’s historical information.
For more information, please contact:
X FinancialMr. Frank Fuya ZhengE-mail: ir@xiaoying.com
Christensen IR
In ChinaMr. Rene VanguestainePhone: +86-178-1749 0483E-mail: rene.vanguestaine@christensencomms.com
In USMs. Linda BergkampPhone: +1-480-614-3004Email: linda.bergkamp@christensencomms.com
X Financial
Unaudited Condensed Consolidated Balance Sheets
(In thousands, except for share and per share data)
As of December 31, 2022
As of December 31, 2023
As of December 31, 2023
RMB
RMB
USD
ASSETS
Cash and cash equivalents
602,271
1,195,352
168,362
Restricted cash
404,689
749,070
105,504
Accounts receivable and contract assets, net
1,161,912
1,659,588
233,748
Loans receivable from Xiaoying Credit Loans and other loans, net
3,810,393
4,947,833
696,888
Loans at fair value
120,280
–
–
Deposits to institutional cooperators, net
1,770,317
1,702,472
239,788
Prepaid expenses and other current assets, net
71,082
48,767
6,870
Deferred tax assets, net
88,428
135,958
19,149
Long-term investments
495,995
493,411
69,495
Property and equipment, net
5,861
8,642
1,217
Intangible assets, net
36,550
36,810
5,185
Loan receivable from Xiaoying Housing Loans, net
10,061
8,657
1,219
Financial investments
192,620
608,198
85,663
Other non-current assets
67,204
55,265
7,784
TOTAL ASSETS
8,837,663
11,650,023
1,640,872
LIABILITIES
Payable to investors and institutional funding partners at amortized cost
2,627,910
3,584,041
504,802
Payable to investors at fair value
141,289
–
–
Guarantee liabilities
–
61,907
8,719
Financial guarantee derivative
107,890
–
–
Short-term borrowings
70,209
565,000
79,579
Accrued payroll and welfare
63,681
86,771
12,221
Other tax payable
255,691
289,819
40,819
Income tax payable
270,089
446,500
62,888
Deposit payable to channel cooperators
19,700
19,700
2,775
Accrued expenses and other current liabilities
476,035
622,324
87,653
Dividend payable
–
59,226
8,342
Other non-current liabilities
51,193
37,571
5,292
Deferred tax liabilities
722
30,040
4,231
TOTAL LIABILITIES
4,084,409
5,802,899
817,321
Commitments and Contingencies
Equity:
Common shares
207
207
29
Treasury stock
(124,597)
(111,520)
(15,707)
Additional paid-in capital
3,191,194
3,196,942
450,280
Retained earnings
1,622,851
2,692,018
379,163
Other comprehensive income
63,599
69,477
9,786
Total X Financial shareholders’ equity
4,753,254
5,847,124
823,551
Non-controlling interests
–
–
–
TOTAL EQUITY
4,753,254
5,847,124
823,551
TOTAL LIABILITIES AND EQUITY
8,837,663
11,650,023
1,640,872
X Financial
Unaudited Condensed Consolidated Statements of Comprehensive Income
Three Months Ended December 31,
Twelve Months Ended December 31,
(In thousands, except for share and per share data)
2022
2023
2023
2022
2023
2023
RMB
RMB
USD
RMB
RMB
USD
Net revenues
Loan facilitation service
562,137
615,482
86,689
2,044,344
2,740,974
386,058
Post-origination service
106,777
166,807
23,494
372,451
596,582
84,027
Financing income
248,639
307,692
43,338
966,277
1,137,336
160,190
Other revenue
38,087
102,683
14,463
179,878
339,992
47,887
Total net revenue
955,640
1,192,664
167,984
3,562,950
4,814,884
678,162
Operating costs and expenses:
Origination and servicing
588,730
755,238
106,373
2,126,742
2,869,845
404,209
General and administrative
42,445
48,142
6,781
171,524
186,515
26,270
Sales and marketing
2,497
3,711
523
15,448
12,539
1,766
(Reversal of) provision for accounts receivable and contract assets
(25,550)
6,250
880
21,836
12,234
1,723
Provision for loans receivable
75,396
99,365
13,995
158,576
229,137
32,273
(Reversal of) provision for contingent guarantee liabilities
–
25,926
3,652
(14,000)
67,520
9,510
(Reversal of) provision for credit losses on deposits to institutional cooperators
(1,831)
(246)
(35)
1,296
(674)
(95)
(Reversal of) provision for credit losses for other financial assets
–
86
12
(765)
86
12
Total operating costs and expenses
681,687
938,472
132,181
2,480,657
3,377,202
475,668
Income from operations
273,953
254,192
35,803
1,082,293
1,437,682
202,494
Interest income (expenses), net
396
(2,587)
(364)
3,756
(20,365)
(2,868)
Foreign exchange gain (loss)
6,175
3,232
455
(19,963)
(4,023)
(567)
Income (loss) from financial investments
28,702
1,686
237
20,900
(12,225)
(1,722)
Impairment losses on financial investments
–
–
–
(8,875)
–
–
Impairment losses on long-term investments
(26,866)
(46,771)
(6,588)
(26,866)
(46,771)
(6,588)
Fair value adjustments related to Consolidated Trusts
209
–
–
(6,168)
(531)
(75)
Change in fair value of financial guarantee derivative
91,380
–
–
137,654
24,966
3,516
Other income, net
8,590
1,346
190
40,724
24,351
3,430
Income before income taxes and gain (loss) from equity in affiliates
382,539
211,098
29,733
1,223,455
1,403,084
197,620
Income tax expense
(74,977)
(35,659)
(5,022)
(389,358)
(249,438)
(35,133)
Gain (loss) from equity in affiliates, net of tax
(32,923)
13,529
1,906
(22,102)
33,148
4,669
Net income
274,639
188,968
26,617
811,995
1,186,794
167,156
Less: net income attributable to non-controlling interests
–
–
–
–
–
–
Net income attributable to X Financial shareholders
274,639
188,968
26,617
811,995
1,186,794
167,156
Net income
274,639
188,968
26,617
811,995
1,186,794
167,156
Other comprehensive income, net of tax of nil:
Gain (loss) from equity in affiliates
39
(52)
(7)
204
(7)
(1)
Income (loss) from financial investments
–
475
67
–
475
67
Foreign currency translation adjustments
(12,887)
(8,214)
(1,157)
57,085
5,410
762
Comprehensive income
261,791
181,177
25,520
869,284
1,192,672
167,984
Less: comprehensive income attributable to non-controlling interests
–
–
–
–
–
–
Comprehensive income attributable to X Financial shareholders
261,791
181,177
25,520
869,284
1,192,672
167,984
Net income per share—basic
0.88
0.65
0.09
2.57
4.12
0.58
Net income per share—diluted
0.86
0.64
0.09
2.52
4.08
0.57
Net income per ADS—basic
5.28
3.90
0.55
15.42
24.72
3.48
Net income per ADS—diluted
5.16
3.84
0.54
15.12
24.48
3.45
Weighted average number of ordinary shares outstanding—basic
311,832,013
291,312,698
291,312,698
316,444,826
288,115,969
288,115,969
Weighted average number of ordinary shares outstanding—diluted
317,710,296
294,631,195
294,631,195
322,403,387
290,833,214
290,833,214
X Financial
Unaudited Reconciliations of GAAP and Non-GAAP Results
Three Months Ended December 31,
Twelve Months Ended December 31,
(In thousands, except for share and per share data)
2022
2023
2023
2022
2023
2023
RMB
RMB
USD
RMB
RMB
USD
GAAP net income
274,639
188,968
26,617
811,995
1,186,794
167,156
Less: Income (loss) from financial investments (net of tax of nil)
28,702
1,686
237
20,900
(12,225)
(1,722)
Less: Impairment losses on financial investments (net of tax of nil)
–
–
–
(8,875)
–
–
Less: Impairment losses on long-term investments (net of tax)
(20,150)
(35,079)
(4,941)
(20,150)
(35,079)
(4,941)
Add: Share-based compensation expenses (net of tax of nil)
11,852
8,421
1,186
53,538
42,598
6,000
Non-GAAP adjusted net income
277,939
230,782
32,507
873,658
1,276,696
179,819
Non-GAAP adjusted net income per share—basic
0.89
0.79
0.11
2.76
4.43
0.62
Non-GAAP adjusted net income per share—diluted
0.87
0.78
0.11
2.71
4.39
0.62
Non-GAAP adjusted net income per ADS—basic
5.34
4.74
0.67
16.56
26.58
3.74
Non-GAAP adjusted net income per ADS—diluted
5.22
4.68
0.66
16.26
26.34
3.71
Weighted average number of ordinary shares outstanding—basic
311,832,013
291,312,698
291,312,698
316,444,826
288,115,969
288,115,969
Weighted average number of ordinary shares outstanding—diluted
317,710,296
294,631,195
294,631,195
322,403,387
290,833,214
290,833,214
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