360 DigiTech, Inc. (QFIN) (“360 DigiTech” or the “Company”), a data
driven, technology empowered digital platform, today announced its
unaudited financial results for the third quarter ended September
30, 2020.
Third Quarter Operational
Highlights
- Total loan origination volume*1 was RMB66,000 million,
representing an increase of 17.9% from RMB55,965 million in the
same period of 2019. Loan origination volume under capital-light
model within Platform Services was RMB16,908 million, an increase
of 48.7% from RMB11,373 million in the same period of 2019.
- Total outstanding loan balance*2 was RMB84,214 million as of
September 30, 2020, an increase of 19.3% from RMB70,568 million as
of September 30, 2019. Outstanding loan balance under capital-light
model within Platform Services was RMB21,453 million as of
September 30, 2020, an increase of 97.2% from RMB10,877 million as
of September 30, 2019.
- The weighted average tenor of loans*3 originated in the third
quarter of 2020 was approximately 8.40 months, compared with 7.90
months in the same period of 2019, and 8.54 months in the second
quarter of 2020.
- Cumulative registered users was 155.96 million, an increase of
23.8% from 126.00 million as of September 30, 2019, and an increase
of 4.7% from 148.98 million as of June 30, 2020.
- Users with approved credit lines*4 was 29.28 million as of
September 30, 2020, an increase of 28.3% from 22.83 million
as of September 30, 2019, and an increase of 5.7% from 27.71
million as of June 30, 2020.
- Cumulative borrowers with successful drawdown, including repeat
borrowers was 18.71 million as of September 30, 2020, an increase
of 27.0% from 14.73 million as of September 30, 2019, and an
increase of 5.3% from 17.77 million as of June 30, 2020.
- 90 day+ delinquency ratio*5 was 1.96% as of September 30,
2020.
- The percentage of funding from financial institutions*6 in the
third quarter of 2020 was 99%.
- Repeat borrower contribution*7 for the third quarter of 2020
was 86.7%.
1 “Total loan origination volume” refers to the
total principal amount of loans originated through the Company’s
platform during the given period, including loans volume originated
through Intelligence Credit Engine (“ICE”). “ICE” is an open
platform on our “360 Jietiao” APP, we match borrowers and financial
institutions through big data and cloud computing technology on
“ICE”, and provide pre-loan investigation report of borrowers. For
loans originated through “ICE”, the Company do not provide
post-loan risk management nor bear principal risk. 2 “Total
outstanding loan balance” refers to the total amount of principal
outstanding for loans originated through the Company’s platform at
the end of each period, including loan balance for “ICE”, excluding
loans delinquent for more than 180 days.3 For loan facilitated in
2020, we use the actual term for extinguished loans and use the
contractual term for outstanding loans to calculate the weighted
average tenor.4 “Users with approved credit lines” refers to the
total number of users who had submitted their credit applications
and were approved with a credit line by the Company at the end of
each period.5 “90 day+ delinquency ratio” refers to the outstanding
principal balance of on- and off-balance sheet loans that were 90
to 179 calendar days past due as a percentage of the total
outstanding principal balance of on- and off-balance sheet loans on
our platform as of a specific date. Loans that are charged-off and
loans under “ICE” are not included in the delinquency rate
calculation.6 “The percentage of funding from financial
institutions” is based on cumulative loan origination during the
given period, excluding loans originated by our own funds. 7
“Repeat borrower contribution” for a given period refers to (i) the
principal amount of loans borrowed during that period by borrowers
who had historically made at least one successful drawdown, divided
by (ii) the total loan origination volume through our platform
during that period.
Third Quarter 2020 Financial
Highlights
- Total net revenue increased by 43.4% to RMB3,703.5 million
(US$545.5 million) from RMB2,583.0 million in the same period of
2019.
- Income from operations increased by 45.5% to RMB1,371.4 million
(US$202.0 million) from RMB942.4 million in the same period of
2019.
- Non-GAAP*8 income from operations increased by 48.0% to
RMB1,427.8 million (US$210.3 million) from RMB964.7 million in the
same period of 2019.
- Operating margin was 37.0%. Non-GAAP operating margin was
38.6%.
- Net income increased by 67.9% to RMB1,231.7 million (US$181.4
million) from RMB733.5 million in the same period of 2019.
- Non-GAAP net income increased by 70.4% to RMB1,288.1 million
(US$189.7 million) from RMB755.8 million in the same period of
2019.
- Net income margin was 33.3%. Non-GAAP net income margin was
34.8%.
8 Non-GAAP income from operations (Adjusted
Income from operations) and Non-GAAP net income (Adjusted net
income) are non-GAAP financial measures. For more information on
this 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.
Mr. Haisheng Wu, Chief Executive Officer and
Director of 360 DigiTech, commented, “We are very pleased to report
yet another strong quarter with best ever operational metrics and
record setting financial results. In the third quarter, loans
originated through our digital platform grew nearly 18%
year-on-year to reach RMB66.0 billion despite some regulatory
headwinds late in the quarter. During the quarter approximately 28%
of the loan origination was under the capital-light model and other
technology solutions*9, for which we bear no or limited principal
risk. As part of our long-term strategy to build a data driven,
technology empowered digital platform, we expect to accelerate the
growth of those platform solutions in the coming quarters.
Throughout the quarter, we have witnessed
continued recovery in consumer demand for credit and further
improvement in asset quality. In fact, some key leading indicators
of asset quality of our customers are at the best levels ever, a
strong testimony for our effective risk management and solid
overall execution. As the domestic outbreak of COVID-19 has been
largely contained and the macro economy is on a recovery track, we
are well positioned to benefit from the positive trends and to
further strengthen our leadership position in the industry.
It has been a quite busy period over last few
months on the regulation front. In July, the official release of
the “Interim Measures for Administration of Internet Loans Issued
by Commercial Banks” by the CBIRC clearly validated our business
model and provided detailed guidelines for the industry. In August,
the Supreme People’s Court of China issued “Guidelines on Laws
Applicable to Trials of Private Lending Cases” setting a series of
rules for private lending, including an interest rate cap. In early
November, the CBIRC issued a draft version of “Interim
Administrative Measures for Online Micro-credit Business” aiming to
cap leverage ratios in micro lending and joint-lending activities.
We believe this new set of rules are consistent with the
regulators’ effort in recent years to deleverage the financial
system and mitigate potential systematic risk. We have marginal
exposure in micro lending and joint-lending. Also in November, the
CBIRC issued “Notice on Promoting the Sustainable Development
Capability of Consumer Finance and Auto Finance Companies and
Improving Quality and Efficiency of Financial Services”, which
clearly set out specific practices for the cooperation between
consumer finance companies and loan facilitation platforms. Such
regulatory changes appeared favoring leading platform with strong
risk management and regulatory compliance capability. We see
opportunities to expand the service scope and depth of our data
driven technology empowered digital platform to reach our long-term
strategic goals.”
“We are very excited to report our first ever
billion RMB quarter in term of non-GAAP net income. During the
quarter, total revenue reached RMB3.70 billion and non-GAAP net
income reached RMB1.29 billion. The robust financial performance
was driven by noticeable improvement in macro environment and
continued optimization of our operations.” Mr. Alex Xu, Chief
Financial Officer, commented “We are particularly pleased to see
the initial impact of the latest interest rate cap was partially
offset by improved operational efficiency. Unit customer
acquisition cost remained relatively stable and weighted average
funding cost reached another new low in the quarter. At the end of
the quarter we had approximately RMB7.9 billion in cash and cash
equivalent on the balance sheet, of which approximately RMB4.8
billion was non-restricted. While there are still some
uncertainties concerning our industry, we are highly confident to
exceed the stated operational targets we set out earlier this
year.”
Mr. Yan Zheng, Chief Risk Officer, added, “The
noticeable improvement in asset quality continued in the quarter.
Among the key leading indicators, Day-1 delinquency*10 decreased to
approximately 5.3% at the end of the third quarter from
approximately 6.2% at the end of the second quarter. Meanwhile the
30-day collection rate*11 also improved to approximately 90% at the
end of the third quarter, compared to approximately 88% at the end
of the second quarter. Furthermore we are encouraged to see some of
these metrics continue to improve into the current quarter and some
are already at the best level ever. This further demonstrates the
strength and effectiveness of our risk management systems. While we
have seen clear indications of macro improvement, we will continue
to take prudent approach in overall risk management operations to
ensure sustainable enhancement in asset quality.”
9 "We've used mainly data technology tools and
AI risk management systems in the process of providing such
services as loan facilitation, post-origination and borrowers'
referral to our customers. Revenue from these technology powered
services amount to 53% of our total net revenue. "10 "D1
delinquency rate" is defined as (i) the total amount of principal
that became overdue as a specified date, divided by (ii) the total
amount of principal that was due for repayment as of such date.11
"M1 collection rate" is defined as (i) the amount of principal that
was repaid in one month among the total amount of principal that
became overdue as a specified date, divided by (ii) the total
amount of principal that became overdue as a specified date.
Third Quarter 2020 Financial
Results
Total net revenues was
RMB3,703.5 million (US$545.5 million), compared to RMB2,583.0
million in the same period of 2019, and RMB3,340.1 million in the
prior quarter.
Net revenue from Credit Driven
Services was RMB2,955.4 million (US$435.3 million),
compared to RMB2,129.3 million in the same period of 2019, and
RMB3,081.1 million in the prior quarter. The year-over-year growth
was mainly due to the releasing of guarantee liabilities under the
new accounting standard, and the increase in loan origination.
Loan facilitation and servicing fees-capital
heavy were RMB1,220.7 million (US$179.8 million), compared to
RMB1,555.1 million in the same period of 2019 and RMB1,353.9
million in the prior quarter. The year-over-year and sequential
decrease was primarily due to a decline in interest rates of the
loans, partially offset by increase of origination volume.
Financing income*12 was RMB530.8 million
(US$78.2 million), compared to RMB409.8 million in the same period
of 2019 and RMB628.1 million in the prior quarter. The
year-over-year growth and sequential decline were primarily due to
the changes in volume of on-balance sheet loans.
Revenue from releasing of guarantee liabilities
was RMB1,172.6 million (US$172.7 million), compared to RMB119.6
million in the same period of 2019, and RMB1,076.6 million in the
prior quarter. The year-over-year increase was mainly due to the
change of accounting standard, and the sequential growth was due to
increase in origination volume.
Other services fees were RMB31.2 million (US$4.6
million), compared to RMB44.8 million in the same period of 2019,
and RMB22.6 million in the prior quarter. The year-over-year and
sequential changes were primarily due to fluctuation of late
payment fees.
Net revenue from Platform
Services was RMB748.1 million (US$110.2 million), compared
to RMB453.8 million in the same period of 2019 and RMB258.9 million
in the prior quarter.
Loan facilitation and servicing fees-capital
light were RMB663.4 million (US$97.7 million), compared to RMB336.3
million in the same period of 2019 and RMB178.6 million in the
prior quarter. The year-over-year increase was primarily due to
growth in loan origination volume under capital-light model. The
robust sequential growth was in part due a reversal of the take
rate reduction in the second quarter related to higher projected
delinquency of certain capital light assets. The actual performance
of such assets turned out better than expected in the third
quarter.
Referral services fees were RMB68.1 million
(US$10.0 million), compared to RMB113.0 million in the same period
of 2019 and RMB64.5 million in the prior quarter. The
year-over-year decline was primarily due to a decrease in volume of
referral business as a result of a more conservative customer
acquisition strategy adopted during the first half of 2020 in the
backdrop of the COVID-19.
Other services fees were RMB16.7 million (US$2.5
million), compared to RMB4.5 million in the same period of 2019 and
RMB15.9 million in the prior quarter. The year-over-year and
sequential increases were mainly due to growth in late payment fees
as loan origination volume under capital-light model increases.
Total operating costs and
expenses were RMB2,332.1 million (US$343.5 million),
compared to RMB1,640.7 million in the same period of 2019 and
RMB2,346.8 million in the prior quarter.
Origination and servicing expenses were RMB408.7
million (US$60.2 million), compared to RMB290.0 million in the same
period of 2019 and RMB399.8 million in the prior quarter. The
year-over-year increase was primarily due to growth in loan
origination volume and an increase in collection fees as we
proactively expanded our collection operations early this year. The
sequential increase was partially offset by improvement in
operational efficiency.
Funding costs were RMB144.6 million (US$21.3
million), compared to RMB118.4 million in the same period of 2019
and RMB161.1 million in the prior quarter. The year-over-year
increase was mainly driven by growth in loan origination volume
while funding cost percentage continued to decline. The sequential
decrease was mainly due to funding cost percentage decline.
Sales and marketing expenses were RMB271.1
million (US$39.9 million), compared to RMB896.9 million in the same
period of 2019 and RMB269.1 million in the prior quarter. The
year-over-year decline was primarily due to a more conservative
customer acquisition strategy and more effective customer
acquisition operations.
General and administrative expenses were
RMB102.4 million (US$15.1 million), compared to RMB85.6 million in
the same period of 2019 and RMB109.5 million in the prior quarter.
The year-over-year increase was due to expanded business
operations, partially offset by our continued effort to improve
operational efficiency, which also resulted in sequential decline
in general and administrative expenses.
Provision for loans receivable was RMB67.4
million (US$9.9 million), compared to RMB151.0 million in the same
period of 2019 and RMB218.6 million in the prior quarter. The
year-over-year and sequential decline was in part due to the
reversal of provision for previous quarters’ on balance sheet loans
as asset quality improved.
Provision for financial assets receivable was
RMB81.6 million (US$12.0 million), compared to RMB44.6 million in
the same period of 2019 and RMB79.2 million in the prior quarter.
The year-over-year increase was due to growth in loan facilitation
volume and higher projected default rates. The sequential increase
is mainly due to the growth in loan volume and partially offset by
the decreased projected default rates.
Provision for accounts receivable and contract
assets was RMB66.2 million (US$9.7 million), compared to RMB54.2
million in the same period of 2019 and RMB90.8 million in the prior
quarter. The year-over-year increase was due to growth in loan
origination under capital light and higher projected default rates.
The sequential decline was driven by improving asset quality.
Provision for contingent liability was
RMB1,190.2 million (US$175.3 million), compared to RMB1,018.9
million in the prior quarter. The sequential increase was mainly
due to growth in loan origination, partially offset by the reversal
of provision for loans originated in prior quarters as those loans
performed better than initially expected.
Income from operations was
RMB1,371.4 million (US$202.0 million), compared to RMB942.4 million
in the same period of 2019 and RMB993.2 million in the prior
quarter.
Non-GAAP income from operations
was RMB1,427.8 million (US$210.3 million), compared to RMB964.7
million in the same period of 2019 and RMB1,058.9 million in the
prior quarter.
Operating margin was 37.0%.
Non-GAAP operating margin was 38.6%.
Income before income tax
expense was RMB1,459.0 million (US$214.9 million),
compared to RMB922.4 million in the same period of 2019 and
RMB1,042.7 million in the prior quarter.
Income taxes expense was
RMB227.3 million (US$33.5 million). Effective tax rate was 15%,
compared to 20% in the same period of 2019 and 15% in the prior
quarter.
Net income attributed to the
Company was RMB1,231.9 million (US$181.4 million),
compared to RMB733.6 million in the same period of 2019 and
RMB876.5 million in the prior quarter.
Non-GAAP net income attributed
to the Company was RMB1,288.3 million (US$189.7 million), compared
to RMB755.9 million in the same period of 2019 and RMB942.2 million
in the prior quarter.
Net income margin was 33.3%.
Non-GAAP net income margin was 34.8%.
Net income per fully diluted
ADS was RMB7.98 (US$1.18).
Non-GAAP net income per fully diluted
ADS was RMB8.35 (US$1.23).
Weighted average basic ADS used in
calculating GAAP and non-GAAP net income per ADS was
150.09 million.
Weighted average diluted ADS used in
calculating GAAP and non-GAAP net income per ADS was
154.32 million.
12 “Financing income” is generated from loans
originated through the Company’s platform funded by the
consolidated trusts and Fuzhou Microcredit, which charge fees and
interests from borrowers.
M1+ Delinquency Rate by Vintage and M6+
Delinquency Rate by Vintage
The following charts and tables display the
historical cumulative M1+ delinquency rates by loan origination
vintage and M6+ delinquency rates by loan origination vintage for
all loans originated through the company’s platform:
http://ml.globenewswire.com/Resource/Download/f3cac188-719e-4204-86ae-79c9c00f0e97
http://ml.globenewswire.com/Resource/Download/56137440-b531-4b7d-9629-16301f0aa360
Business Outlook
While it is still prudent to take a conservative
approach in business and financial planning given the fast changing
regulatory environment as well as some residual impact from the
COVID-19, we are encouraged by the strong business
momentum. As such the Company would like to raise its total
loan origination volume target for fiscal year 2020 to the range of
RMB 242 billion to RMB 244 billion, from previous guidance of RMB
200 billion to RMB 220 billion. This forecast reflects the
Company’s current and preliminary views, which is subject to
change.
Recently Adopted Accounting
Guidance
In June 2016, the FASB issued ASU No. 2016-13,
Financial Instruments—Credit Losses (Topic 326): Measurement of
Credit Losses on Financial Instruments which has subsequently been
amended by ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-10, ASU
2019-11 and ASU 2020-03. This ASU is intended to improve financial
reporting by requiring timelier recording of credit losses on loans
and other financial instruments held by financial institutions and
other organizations. This ASU requires the measurement of all
expected credit losses for financial assets held at the reporting
date based on historical experience, current conditions, and
reasonable and supportable forecasts. For public business entities,
the guidance is effective for fiscal years beginning after December
15, 2019, including final periods within those fiscal years.
We have adopted the new standard effective
January 1, 2020, using the modified retrospective transition
method. The new guidance requires the recognition of credit losses
to be measured using an expected credit loss model (referred to as
the current expected credit loss (CECL) model). ASC 326 establishes
a new accounting principle which requires gross accounting for
guarantee liability. That is, to record both a guarantee obligation
and an allowance for credit losses, calculated using the CECL
impairment model, in addition to the guarantee obligation under ASC
460. As a result, at inception of the guarantee, we have recognized
both a stand-ready guarantee liability under ASC 460 with an
associated financial assets receivable, and a contingent guarantee
liability with an allowance for credit losses under CECL model.
Subsequent to the initial recognition, the ASC 460 stand-ready
guarantee is recognized into guarantee revenue over the term of the
guarantee, while the contingent guarantee is reduced by the payouts
made by the company to compensate the investors upon borrowers'
default. Upon adoption, we recognized the cumulative effect of
approximately RMB1.43 billion after tax as a decrease to the
opening balance of retained earnings and RMB1.9 billion as an
increase to the opening balance of guarantee liabilities as of
January 1, 2020.
Move from Nasdaq Global Market to Nasdaq
Global Select Market
The Company’s application to move the listing of
its ADSs from The Nasdaq Global Market to the higher tier of The
Nasdaq Global Select Market has been approved by Nasdaq, and its
ADSs has begun trading on The Nasdaq Global Select Market from
November 19, 2020.
Conference Call
360 DigiTech’s management team will host an
earnings conference call at 8:00 PM U.S. Eastern Time on Thursday,
November 19, 2020 (9:00 AM Beijing Time on November 20).
Dial-in details for the earnings conference call
are as follows:
United States: |
+1-646-722-4977 |
Hong Kong: |
+852-3027-6500 |
Mainland China: |
400-821-0637 |
International: |
+65-6408-5782 |
PIN: |
60180978# |
Please dial in 15 minutes before the call is
scheduled to begin and provide the PIN to join the call.
A telephone replay of the call will be available
after the conclusion of the conference call until November 27,
2020:
United States: |
+1-646-982-0473 |
International: |
+65-6408-5781 |
Access code: |
319338659# |
Additionally, a live and archived webcast of the
conference call will be available on the Investor Relations section
of the Company's website at ir.360shuke.com.
About 360 DigiTech
360 DigiTech, Inc. (NASDAQ: QFIN) (“360
DigiTech” or the “Company”) is a data driven, technology empowered
digital platform. Through its platform the Company enables
financial institutions to provide better and targeted products and
services to a broader consumer base. The Company also offers
standardized risk management service, in the form of SaaS modules
to institutional clients. When coupled with its partnership with
360 Group, the Company’s solutions created noticeable advantages in
customer acquisition, funding optimization, risk assessment and
post-lending management.
For more information, please visit:
ir.360shuke.com
Use of Non-GAAP Financial Measures
Statement
To supplement our financial results presented in
accordance with U.S. GAAP, we use non-GAAP financial measure, which
is adjusted from results based on U.S. GAAP to exclude share-based
compensation expenses. Reconciliations of our non-GAAP financial
measures to our U.S. GAAP financial measures are set forth in
tables at the end of this earnings release, which provide more
details on the non-GAAP financial measures.
We use non-GAAP income from operation, non-GAAP
operation margin, non-GAAP net income and non-GAAP net income
margin in evaluating our operating results and for financial and
operational decision-making purposes. Non-GAAP income from
operation represents income from operation excluding share-based
compensation expenses, and non-GAAP net income represents net
income excluding share-based compensation expenses. Such
adjustments have no impact on income tax. We believe that non-GAAP
income from operation and non-GAAP net income help identify
underlying trends in our business that could otherwise be distorted
by the effect of certain expenses that we include in results based
on U.S. GAAP. We believe that non-GAAP income from operation and
non-GAAP net income provide useful information about our 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. Our non-GAAP financial information
should be considered in addition to results prepared in accordance
with U.S. GAAP, but should not be considered a substitute for or
superior to U.S. GAAP results. In addition, our calculation of
non-GAAP financial information may be different from the
calculation used by other companies, and therefore comparability
may be limited.
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
RMB6.7896 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, 2020.
Safe Harbor Statement
Any forward-looking statements contained in this
announcement are made under the "safe harbor" provisions of the
U.S. Private Securities Litigation Reform Act of 1995.
Forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates" and similar statements. 360 Finance may
also make written or oral forward-looking statements in its reports
to the U.S. Securities and Exchange Commission ("SEC") on Forms
20-F and 6-K, 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 the Company’s business
outlook for 2019, are forward-looking statements. Forward-looking
statements involve inherent risks and uncertainties. A number of
factors could cause actual results to differ materially from those
contained in any forward-looking statement. Further information
regarding such risks and uncertainties is included in 360 Finance's
filings with the SEC. All information provided in this press
release and in the attachments is as of the date of this press
release, and 360 Finance does not undertake any obligation to
update any forward-looking statement, except as required under
applicable law.
For more information, please
contact:
360 DigiTech
E-mail: ir@360shuke.com
Christensen
In ChinaMr. Eric YuanPhone:
+86-138-0111-0739E-mail: Eyuan@christensenir.com
In US Ms. Linda BergkampPhone:
+1-480-614-3004Email: lbergkamp@christensenir.com
Unaudited Condensed Consolidated Balance
Sheets(Amounts in thousands of Renminbi (“RMB”) and U.S.
dollars (“USD”)except for number of shares and per share data, or
otherwise noted)
|
|
|
|
|
December 31, |
September 30, |
September 30, |
|
2019 |
2020 |
2020 |
|
RMB |
RMB |
USD |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
2,108,123 |
4,821,031 |
|
710,061 |
|
Restricted cash |
1,727,727 |
2,400,617 |
|
353,573 |
|
Security deposit prepaid to third-party guarantee companies |
932,983 |
654,633 |
|
96,417 |
|
Funds receivable from third party payment service providers |
118,860 |
149,436 |
|
22,010 |
|
Accounts receivable and
contract assets, net |
2,332,364 |
2,225,995 |
|
327,854 |
|
Financial assets receivable, net |
1,912,554 |
3,023,254 |
|
445,277 |
|
Amounts due from related parties |
478,767 |
244,687 |
|
36,039 |
|
Loans receivable, net |
9,239,565 |
8,164,168 |
|
1,202,452 |
|
Prepaid expenses and other assets |
652,545 |
457,484 |
|
67,380 |
|
Total current assets |
19,503,488 |
22,141,305 |
|
3,261,063 |
|
Non-current assets: |
|
|
|
Accounts receivable and contract assets, net-non current |
19,508 |
314,967 |
|
46,390 |
|
Financial assets receivable, net-non current |
59,270 |
551,607 |
|
81,243 |
|
Property and equipment, net |
17,113 |
20,706 |
|
3,050 |
|
Intangible assets |
3,512 |
3,547 |
|
522 |
|
Deferred tax assets |
697,348 |
1,150,562 |
|
169,459 |
|
Other non-current assets |
55,362 |
54,766 |
|
8,066 |
|
Total non-current assets |
852,113 |
2,096,155 |
|
308,730 |
|
TOTAL ASSETS |
20,355,601 |
24,237,460 |
|
3,569,793 |
|
|
|
|
|
LIABILITIES AND EQUITY
LIABILITIES |
|
|
|
Current liabilities: |
|
|
|
Payable to investors of the consolidated trusts-current |
4,423,717 |
3,498,751 |
|
515,310 |
|
Accrued expenses and other
current liabilities |
720,918 |
829,935 |
|
122,238 |
|
Amounts due to related parties |
55,622 |
53,794 |
|
7,923 |
|
Short term loans |
200,000 |
184,870 |
|
27,228 |
|
Guarantee liabilities-stand ready |
2,212,125 |
3,647,546 |
|
537,225 |
|
Guarantee liabilities-contingent |
734,730 |
3,525,452 |
|
519,243 |
|
Income tax payable |
1,056,219 |
935,778 |
|
137,825 |
|
Other tax payable |
263,856 |
156,614 |
|
23,067 |
|
Total current liabilities |
9,667,187 |
12,832,740 |
|
1,890,059 |
|
Non-current liabilities: |
|
|
|
Deferred tax liabilities |
- |
14,825 |
|
2,183 |
|
Payable to investors of the consolidated trusts-noncurrent |
3,442,500 |
3,138,526 |
|
462,255 |
|
Other long-term liabilities |
31,184 |
20,544 |
|
3,026 |
|
Total non-current liabilities |
3,473,684 |
3,173,895 |
|
467,464 |
|
TOTAL LIABILITIES |
13,140,871 |
16,006,635 |
|
2,357,523 |
|
Ordinary shares |
20 |
21 |
|
3 |
|
Additional paid-in
capital |
5,117,184 |
5,309,654 |
|
782,028 |
|
Retained earnings |
2,071,332 |
2,932,733 |
|
431,945 |
|
Other comprehensive income
(loss) |
24,906 |
(12,540 |
) |
(1,847 |
) |
TOTAL 360 DIGITECH INC EQUITY |
7,213,442 |
8,229,868 |
|
1,212,129 |
|
Noncontrolling interests |
1,288 |
957 |
|
141 |
|
TOTAL EQUITY |
7,214,730 |
8,230,825 |
|
1,212,270 |
|
TOTAL LIABILITIES AND EQUITY |
20,355,601 |
24,237,460 |
|
3,569,793 |
|
|
|
|
|
Unaudited Condensed Consolidated
Statements of Operations(Amounts in thousands of Renminbi
(“RMB”) and U.S. dollars (“USD”)except for number of shares and per
share data, or otherwise noted)
|
|
|
|
|
|
|
|
|
Three months ended September
30, |
|
Nine months ended September
30, |
|
2019 |
2020 |
2020 |
|
2019 |
2020 |
2020 |
|
RMB |
RMB |
USD |
|
RMB |
RMB |
USD |
Credit driven services |
2,129,275 |
|
2,955,392 |
|
435,282 |
|
|
6,034,567 |
|
8,846,546 |
|
1,302,954 |
|
Loan facilitation and servicing fees-capital
heavy |
1,555,089 |
|
1,220,748 |
|
179,797 |
|
|
4,994,681 |
|
3,741,738 |
|
551,098 |
|
Financing income |
409,763 |
|
530,766 |
|
78,173 |
|
|
724,223 |
|
1,768,279 |
|
260,439 |
|
Revenue from releasing of guarantee
liabilities |
119,579 |
|
1,172,640 |
|
172,711 |
|
|
204,261 |
|
3,255,371 |
|
479,464 |
|
Other services fees |
44,844 |
|
31,238 |
|
4,601 |
|
|
111,402 |
|
81,158 |
|
11,953 |
|
Platform services |
453,764 |
|
748,129 |
|
110,187 |
|
|
784,399 |
|
1,379,922 |
|
203,240 |
|
Loan facilitation and servicing fees-capital
light |
336,269 |
|
663,354 |
|
97,701 |
|
|
465,007 |
|
1,145,564 |
|
168,723 |
|
Referral services fees |
113,004 |
|
68,086 |
|
10,028 |
|
|
312,720 |
|
187,149 |
|
27,564 |
|
Other services fees |
4,491 |
|
16,689 |
|
2,458 |
|
|
6,672 |
|
47,209 |
|
6,953 |
|
Total net
revenue |
2,583,039 |
|
3,703,521 |
|
545,469 |
|
|
6,818,966 |
|
10,226,468 |
|
1,506,194 |
|
Origination and servicing |
290,003 |
|
408,693 |
|
60,194 |
|
|
753,789 |
|
1,156,112 |
|
170,277 |
|
Funding costs |
118,402 |
|
144,596 |
|
21,297 |
|
|
209,148 |
|
464,272 |
|
68,380 |
|
Sales and marketing |
896,907 |
|
271,082 |
|
39,926 |
|
|
2,424,948 |
|
763,144 |
|
112,399 |
|
General and administrative |
85,584 |
|
102,387 |
|
15,080 |
|
|
309,230 |
|
320,606 |
|
47,220 |
|
Provision for loans receivable |
151,010 |
|
67,383 |
|
9,924 |
|
|
205,808 |
|
593,211 |
|
87,371 |
|
Provision for financial assets receivable |
44,607 |
|
81,642 |
|
12,025 |
|
|
101,517 |
|
254,565 |
|
37,493 |
|
Provision for accounts receivable and contract
assets |
54,156 |
|
66,163 |
|
9,745 |
|
|
183,149 |
|
213,950 |
|
31,511 |
|
Provision
for contingent liabilities |
- |
|
1,190,176 |
|
175,294 |
|
|
- |
|
3,911,793 |
|
576,145 |
|
Total operating costs
and expenses |
1,640,669 |
|
2,332,122 |
|
343,485 |
|
|
4,187,589 |
|
7,677,653 |
|
1,130,796 |
|
Income from
operations |
942,370 |
|
1,371,399 |
|
201,984 |
|
|
2,631,377 |
|
2,548,815 |
|
375,398 |
|
Interest (expense) income, net |
(25,546 |
) |
19,623 |
|
2,890 |
|
|
(27,478 |
) |
44,601 |
|
6,569 |
|
Foreign exchange (loss) gain |
(64,793 |
) |
63,408 |
|
9,339 |
|
|
(67,521 |
) |
39,521 |
|
5,821 |
|
Other income, net |
70,409 |
|
4,609 |
|
679 |
|
|
94,305 |
|
96,899 |
|
14,272 |
|
Income before income
tax expense |
922,440 |
|
1,459,039 |
|
214,892 |
|
|
2,630,683 |
|
2,729,836 |
|
402,060 |
|
Income taxes expense |
(188,952 |
) |
(227,315 |
) |
(33,480 |
) |
|
(559,077 |
) |
(438,492 |
) |
(64,583 |
) |
Net
income |
733,488 |
|
1,231,724 |
|
181,412 |
|
|
2,071,606 |
|
2,291,344 |
|
337,477 |
|
Net loss attributable to noncontrolling
interests |
73 |
|
151 |
|
22 |
|
|
73 |
|
453 |
|
67 |
|
Net income
attributable to ordinary shareholders of the Company |
733,561 |
|
1,231,875 |
|
181,434 |
|
|
2,071,679 |
|
2,291,797 |
|
337,544 |
|
Net income per ordinary share attributable to ordinary shareholders
of 360 DigiTech, Inc. |
|
|
|
|
|
|
|
Basic |
2.55 |
|
4.10 |
|
0.60 |
|
|
7.20 |
|
7.73 |
|
1.14 |
|
Diluted |
2.45 |
|
3.99 |
|
0.59 |
|
|
6.88 |
|
7.50 |
|
1.10 |
|
|
|
|
|
|
|
|
|
Net income per ADS attributable to ordinary shareholders of 360
DigiTech, Inc. |
|
|
|
|
|
|
|
Basic |
5.10 |
|
8.20 |
|
1.20 |
|
|
14.40 |
|
15.46 |
|
2.28 |
|
Diluted |
4.90 |
|
7.98 |
|
1.18 |
|
|
13.76 |
|
15.00 |
|
2.20 |
|
|
|
|
|
|
|
|
|
Weighted average shares used in calculating net income per ordinary
share |
|
|
|
|
|
|
|
Basic |
288,054,825 |
|
300,174,655 |
|
300,174,655 |
|
|
287,788,219 |
|
296,518,120 |
|
296,518,120 |
|
Diluted |
299,107,729 |
|
308,646,862 |
|
308,646,862 |
|
|
301,306,666 |
|
305,520,538 |
|
305,520,538 |
|
|
|
|
|
|
|
|
|
Unaudited Condensed Consolidated
Statements of Comprehensive (Loss)/Income(Amounts in
thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)except for
number of shares and per share data, or otherwise noted)
|
|
|
|
|
Three months ended September
30, |
|
2019 |
2020 |
2020 |
|
RMB |
RMB |
USD |
Net income |
733,488 |
1,231,724 |
|
181,412 |
|
Other comprehensive income, net of tax of nil: |
|
|
|
Foreign currency translation adjustment |
68,476 |
(64,847 |
) |
(9,551 |
) |
Other comprehensive income (loss) |
68,476 |
(64,847 |
) |
(9,551 |
) |
Total comprehensive income |
801,964 |
1,166,877 |
|
171,861 |
|
Net loss attributable to noncontrolling interests |
73 |
151 |
|
22 |
|
Comprehensive income
attributable to ordinary shareholders |
802,037 |
1,167,028 |
|
171,883 |
|
|
|
|
|
|
|
|
|
|
Nine months ended September
30, |
|
2019 |
2020 |
2020 |
|
RMB |
RMB |
USD |
Net
income |
2,071,606 |
2,291,344 |
|
337,477 |
|
Other comprehensive income, net of tax of nil: |
|
|
|
Foreign currency translation adjustment |
65,946 |
(37,446 |
) |
(5,515 |
) |
Other comprehensive income (loss) |
65,946 |
(37,446 |
) |
(5,515 |
) |
Total comprehensive income |
2,137,552 |
2,253,898 |
|
331,962 |
|
Net loss attributable to noncontrolling interests |
73 |
453 |
|
67 |
|
Comprehensive income
attributable to ordinary shareholders |
2,137,625 |
2,254,351 |
|
332,029 |
|
|
|
|
|
|
|
Unaudited Reconciliations of GAAP and
Non-GAAP Results(Amounts in thousands of Renminbi (“RMB”)
and U.S. dollars (“USD”)except for number of shares and per share
data, or otherwise noted)
|
|
|
|
|
Three months ended September
30, |
|
2019 |
2020 |
2020 |
|
RMB |
RMB |
USD |
Reconciliation of
Non-GAAP Net Income to Net Income |
|
|
|
Net income |
733,488 |
|
1,231,724 |
|
181,412 |
Add: Share-based compensation expenses |
22,320 |
|
56,396 |
|
8,306 |
Non-GAAP net income |
755,808 |
|
1,288,120 |
|
189,718 |
Non-GAAP net income
margin |
29.3 |
% |
34.8 |
% |
|
GAAP net income margin |
28.4 |
% |
33.3 |
% |
|
|
|
|
|
Net income
attributable to shareholders of 360 DigiTech, Inc |
733,561 |
|
1,231,875 |
|
181,434 |
Add: Share-based compensation expenses |
22,320 |
|
56,396 |
|
8,306 |
Non-GAAP net income
attributable to shareholders of 360 DigiTech, Inc |
755,881 |
|
1,288,271 |
|
189,740 |
Weighted average ADS used in calculating net income per ordinary
share -diluted |
149,553,865 |
|
154,323,431 |
|
154,323,431 |
Net income per ADS attributable to ordinary shareholders of 360
DigiTech, Inc. -diluted |
4.90 |
|
7.98 |
|
1.18 |
Non-GAAP net income per ADS attributable to ordinary shareholders
of 360 DigiTech, Inc. -diluted |
5.05 |
|
8.35 |
|
1.23 |
|
|
|
|
Reconciliation of
Non-GAAP Income from operations to Income from
operations |
|
|
|
Income from operations |
942,370 |
|
1,371,399 |
|
201,984 |
Add: Share-based compensation expenses |
22,320 |
|
56,396 |
|
8,306 |
Non-GAAP Income from operations |
964,690 |
|
1,427,795 |
|
210,290 |
Non-GAAP operating margin |
37.3 |
% |
38.6 |
% |
|
GAAP operating margin |
36.5 |
% |
37.0 |
% |
|
|
|
|
|
|
|
|
|
|
Nine months ended September
30, |
|
2019 |
|
2020 |
|
2020 |
|
RMB |
RMB |
USD |
Reconciliation of
Non-GAAP Net Income to Net Income |
|
|
|
Net income |
2,071,606 |
|
2,291,344 |
|
337,477 |
Add: Share-based compensation expenses |
164,702 |
|
193,447 |
|
28,492 |
Non-GAAP net income |
2,236,308 |
|
2,484,791 |
|
365,969 |
Non-GAAP net income
margin |
32.8 |
% |
24.3 |
% |
|
GAAP net income margin |
30.4 |
% |
22.4 |
% |
|
|
|
|
|
Net income
attributable to shareholders of 360 DigiTech, Inc |
2,071,679 |
|
2,291,797 |
|
337,544 |
Add: Share-based compensation expenses |
164,702 |
|
193,447 |
|
28,492 |
Non-GAAP net income
attributable to shareholders of 360 DigiTech, Inc |
2,236,381 |
|
2,485,244 |
|
366,036 |
Weighted average ADS used in calculating net income per ordinary
share -diluted |
150,653,333 |
|
152,760,269 |
|
152,760,269 |
Net income per ADS attributable to ordinary shareholders of 360
DigiTech, Inc. -diluted |
13.76 |
|
15.00 |
|
2.20 |
Non-GAAP net income per ADS attributable to ordinary shareholders
of 360 DigiTech, Inc. -diluted |
14.84 |
|
16.27 |
|
2.40 |
|
|
|
|
Reconciliation of Non-GAAP Income from operations to Income
from operations |
|
|
|
Income from operations |
2,631,377 |
|
2,548,815 |
|
375,398 |
Add: Share-based compensation expenses |
164,702 |
|
193,447 |
|
28,492 |
Non-GAAP Income from operations |
2,796,079 |
|
2,742,262 |
|
403,890 |
Non-GAAP operating margin |
41.0 |
% |
26.8 |
% |
|
GAAP operating margin |
38.6 |
% |
24.9 |
% |
|
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