Jiayin Group Inc. (“Jiayin” or the “Company”) (NASDAQ: JFIN), a leading online individual finance marketplace in China, today announced its unaudited financial results for the quarter ended September 30, 2019.

Highlights:

  • Loan origination volume1 was RMB4,720 million, representing an increase of 12.6% from the same period of 2018, and a decrease of 3.7% sequentially 
  • Investment volume2 was RMB5,128 million, representing an increase of 11.3% from the same period of 2018, and a decrease of 17.8% sequentially 
  • Average investment amount per investor was RMB74,592, representing an increase of 31.7% from the same period of 2018 
  • Average borrowing amount per borrower was RMB7,453, representing an increase of 10.4% from the same period of 2018  
  • Net revenue was RMB510.8 million, representing an increase of 0.5% from the same period of 2018, and a decrease of 19.6 % sequentially 
  • Operating income was RMB83.5 million, compared with an operating loss of RMB 55.8 million in the same period of 2018, and a decrease of 55.0% sequentially  
  • Net income was RMB81.8million, compared with a net loss of RMB 44.0 million in the same period of 2018, and a decrease of 51.5% sequentially  

Mr. Yan Dinggui, the Founder, Director and Chief Executive Officer, commented: “Industry conditions remained challenging during the third quarter, but solid execution of Company’s strategy enabled us to sustain an attractive level of profitability. Our efforts now are focused on preparation for the change in regulatory qualification and compliance. Because the final outcome of industry reforms is still uncertain, we want to be fully prepared for a range of scenarios.”

Financial Results

Net revenue was RMB510.8 million (US$71.5 million), representing an increase of 0.5% from the same period of 2018.

Revenue from loan facilitation services was RMB396.5 million (US$55.5 million), representing an increase of 6.6% from the same period of 2018, primarily due to the increased loan origination volume compared with the same period of 2018.

Revenue from post-origination services was RMB59.3 million (US$8.3 million), representing a decrease of 3.4% from the same period of 2018. The decrease was due to the disposal of our previously-consolidated affiliated company Shanghai Caiyin Asset Management Co, Ltd. ("Caiyin"), which provided certain post-origination loan services.

Origination and servicing expense was RMB101.1 million (US$14.1 million), representing an increase of 2.7% from the same period of 2018, primarily due to higher expenses associated with credit assessment.

Allowance for uncollectible receivables and contract assets was RMB67.8 million (US$9.5 million), representing an increase of 156.9% from the same period of 2018, primarily due to the increase in loan origination volume and unfavorable changes in estimated collectability, which is caused by difficult industry conditions.

Sales and marketing expense was RMB152.4 million (US$21.3million), representing an increase of 33.8% from the same period of 2018, driven by an increase in advertising expenses to promote the Company’s brand.

General and administrative expense was RMB47.5 million (US$6.6 million), representing an increase of 76.7% from the same period of 2018. The increase was primarily due to increased staffing cost, as well as certain share-based compensation expense allocated to general and administrative expenses.

Research and development expense was RMB58.6 million (US$8.2 million), representing an increase of 60.0% from the same period of 2018, as the Company continued to invest in technology.

Income from operations was RMB83.5 million (US$11.7 million), compared with an operating loss of RMB 55.8 million in the same period of 2018.

Net income attributable to Jiayin shareholders was RMB81.8 million (US$11.4 million), compared with a net loss of RMB44.0 million in the same period of 2018.

Cash and cash equivalents at quarter-end were RMB238.0 million (US$33.3 million), compared with RMB359.8 million in the same period of 2018.

During the quarter, the Company conducted a business combination with Geerong Yun (Shanghai) Enterprise Development Co., Ltd. (“Geerong Yun”), an innovative fintech-driven platform connecting financial institutions. Prior to the combination, Geerong Yun and Jiayin were under the common control of Mr. Dinggui Yan, the Founder, Director and Chief Executive Officer of Jiayin. The combination has been retrospectively reflected in the financial statements from the beginning of 2019, but not to prior periods as the impact was not material. The consolidation is intended to support the growth of Jiayin’s institutional funding sources, as well as to strengthen our big data analytics and fintech R&D. In addition, during this quarter, the Company disposed Caiyin, the details of the disposal was provided in the Company’s press releases furnished to the SEC on form 6-Ks, including the relevant exhibits which dated on September 16, 2019 and October 24, 2019, respectively.

Conference Call

The Company will host a conference call to discuss its financial results on Tuesday, November 26, 2019 at 8:00 a.m. US Eastern Time/ 9:00 PM China Standard Time.

Dial-in details for the earnings conference call are as follows:

China: +86 4006208038  or   +86 8008190121
Hong Kong +852 3018-6771
United States, New York +1 (845) 675-0437
   

To join, please dial in 10 minutes before the call is scheduled to begin and provide the passcode 6759548.

  Phone Number Toll-Free Number
United States +1 (845) 675-0437 +1 (866) 519-4004
Hong Kong +852 30186771 +852 800906601
Mainland China +86 8008190121+86 4006208038  

A replay of the conference call may be accessed by phone at the following numbers until December 3, 2019. To access the replay, please reference the conference ID 6759548.

  Phone Number Toll-Free Number
United States +1 (646) 254-3697 +1 (855) 452-5696
Hong Kong +852 30512780 +852 800963117
Mainland China +86 8008700206+86 4006022065  

A live and archived webcast of the conference call will be available on the Company’s investors relations website at  http://ir.niwodai.com/.

About Jiayin Group Inc.

Jiayin Group Inc. is a leading online individual finance marketplace in China committed to facilitating effective, transparent, secure and fast connections between investors and borrowers, whose needs are underserved by traditional financial institutions. The origin of the business of the Company can be traced back to 2011. The Company operates a highly secure and open platform with a comprehensive risk management system and a proprietary and effective risk assessment model which employs advanced big data analytics and sophisticated algorithms to accurately assess the risk profiles of potential borrowers.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) 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 RMB7.1477 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of September 30, 2019. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

Safe Harbor / Forward-Looking Statements

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to 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. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and the industry. Potential risks and uncertainties include, but are not limited to, those relating to the Company’s ability to retain existing investors and borrowers and attract new investors and borrowers in an effective and cost-efficient way, the Company’s ability to increase the investment volume and loan origination of loans volume facilitated through its marketplace, effectiveness of the Company’s credit assessment model and risk management system, PRC laws and regulations relating to the online individual finance industry in China, general economic conditions in China, and the Company’s ability to meet the standards necessary to maintain listing of its ADSs on the Nasdaq Stock Market or other stock exchange, including its ability to cure any non-compliance with the continued listing criteria of the Nasdaq Stock Market. All information provided in this press release is as of the date hereof, and the Company undertakes no obligation to update any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results. Further information regarding risks and uncertainties faced by the Company is included in the Company’s filings with the U.S. Securities and Exchange Commission, including its registration statement on Form F-1 filed in connection with its initial public offering.

For more information, please contact:

In China:

Jiayin GroupMs. Shelley BaiEmail: ir@niwodai.com

or

The Blueshirt GroupMs. Susie WangEmail: susie@blueshirtgroup.com

In the U.S.:

Ms. Julia QianEmail: julia@blueshirtgroup.com

JIAYIN GROUP INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except for share and per share data)

         
    As of December 31,   As of September 30,
    2018   2019
    RMB   RMB   US$
ASSETS            
Cash and cash equivalents   41,441   237,994   33,297
Restricted cash   41,500   -   -
Amounts due from related parties   -   131,328   18,373
Accounts receivable, net   336,849   208,798   29,212
Contract assets, net   203,080   -   -
Assets from the investor assurance program, net   5,525   -   -
Short term Investment   -   71,477   10,000
Prepaid expenses and other current assets   88,234   132,118   18,484
Deferred tax assets   56,027   -   -  
Long term Investment   -   3,540   495
Property and equipment   29,011   39,169   5,480
Right-of-use assets3     44,742   6,260
Other long-term assets   212   3,234   452
TOTAL ASSETS   801,879   872,400   122,053
             
LIABILITIES AND EQUITY            
Liabilities including amounts of the consolidated VIEs   without recourse to the Company:            
Payroll and welfare payable   110,562   91,512   12,803
Amounts due to related parties   84,509   7,511   1,051
Liabilities from investor assurance program   1,547,072   -   -
Other guarantee liabilities   4,060    
Other Payable   50,783   293,069   41,002
Other Payable related to the disposal of Caiyin   -   987,511   138,158
Tax payables   422,177   141,491   19,795
Refund liabilities   84,498   -   -
Lease liabilities3     42,914   6,004
Deferred Tax Liability   -   4,969   695
Accrued expenses and other current liabilities   150,224   143,285   20,046
TOTAL LIABILITIES   2,453,885   1,712,262   239,554
Commitments and Contingencies            
SHAREHOLDERS' DEFICIT              
Ordinary shares (US$ 0.000000005 par value; 10,000,000,000,000 shares authorized, 200,000,000 shares issued and outstanding as of December 31, 2018, 216,100,000 shares issued and outstanding as of September 30, 2019, respectively)   0   0   0  
Additional paid-in capital    395,472   715,029   100,036  
Accumulated deficit4   (2,047,478 ) (1,565,535 ) (219,026 )
Other comprehensive income   -   10,770   1,507  
Minority interests   -   (126 ) (18 )
TOTAL SHAREHOLDERS' DEFICIT   (1,652,006 ) (839,862 ) (117,501 )
TOTAL LIABILITIES AND DEFICIT   801,879   872,400   122,053  
               
               

JIAYIN GROUP INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in thousands, except for share and per share data)

  Three Months EndedSeptember 30   Nine Months EndedSeptember 30
  2018     2019   2018     2019  
  RMB   RMB   US$   RMB   RMB   US$  
Net revenue  (including revenue from relatedparties of RMB nil and RMB 654 for the period 2018Q3,and 2019Q3, respectively) 508,165   510,773   71,460   2,171,683   1,887,556   264,079  
Operating cost and expenses:                        
Origination and servicing (97,911 ) (101,128 ) (14,148 ) (284,035 ) (354,929 ) (49,656 )
Allowance for uncollectible accounts receivable and contract assets (26,386 ) (67,780 ) (9,483 ) (187,618 ) (182,325 ) (25,508 )
Provision for assets and liabilities from investor assurance program (262,336 ) -     (426,710 ) -   -  
Sales and marketing (113,867 ) (152,364 ) (21,317 ) (562,630 ) (492,336 ) (68,880 )
General and administrative (26,856 ) (47,465 ) (6,641 ) (83,272 ) (154,405 ) (21,602 )
Research and development (36,612 ) (58,566 ) (8,194 ) (112,387 ) (162,785 ) (22,775 )
Total operating cost and expenses   (563,968 ) (427,303 ) (59,783 ) (1,656,652 ) (1,346,780 ) (188,421 )
                         
Income (loss) from operation (55,803 ) 83,470   11,677   515,031   540,776   75,658  
Interest income (expense) 230   88   12   1,042   (88 ) (12 )
Other income, net  1,669   7,308   1,022   12,039   20,876   2,921  
Income (loss)  before income taxes   (53,904 ) 90,866   12,711   528,112   561,564   78,567  
Income tax expense 9,952   (9,099 ) (1,273 ) (78,689 ) (79,623 ) (11,140 )
                         
Net income (loss) (43,952 ) 81,767   11,438   449,423   481,941   67,427  
Less: net income (loss) attributable to non-controlling interest shareholders -   152   21   -   (76 ) (11 )
Net income (loss) attributable to Jiayin Group Inc. (43,952 ) 81,615   11,417   449,423   482,017   67,438  
                         
Other comprehensive income, net of tax of nil:                        
Foreign currency translation adjustments -   10,770   1,507   -   10,777   1,508  
Total comprehensive income (loss) attributable to Jiayin Group Inc. (43,952 ) 92,385   12,924   449,423   492,794   68,946  
Weighted average shares used in calculating net income per share:                          
 - Basic and diluted  200,000,000   216,100,000   216,100,000   200,000,000   206,307,671   206,307,671  
                         
Net income (loss)  per share:                          
 - Basic and diluted (0.22 ) 0.38   0.05   2.25   2.34   0.33  
                         
Net income (loss) per ADS(1 ADS represents 4 ordinary shares):                          
 - Basic and diluted (0.88 ) 1.52   0.20   9.00   9.36   1.32  

_________________________________1 “Loan origination volume” refers to the total amount of loans facilitated during the period presented.2 “Investment volume” refers to the total amount of all investment transactions executed by investors during the period presented.3 The Company has adopted ASU No. 2016-02, “Leases,” beginning January 1, 2019 and elected to utilize a modified retrospective approach which allowed the Company to initially apply the new lease standard at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings of 2019, with no adjustments to prior periods presented. No cumulative effect adjustment to the opening balance of retained earnings were made. The adoption of the new guidance did not have a material effect the Company’s our results of operations, financial condition or liquidity.4 It includes accumulated loss from under common control transactions related to Geerong Yun.

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