CNinsure Inc., (Nasdaq:CISG), (the "Company" or "CNinsure"), a
leading independent insurance intermediary company operating in
China, today announced its unaudited financial results for the
third quarter ended September 30, 2011.1
Financial Highlights:
Highlights for Third Quarter 2011
- Total net revenues: RMB383.7 million (US$60.2 million),
representing an increase of 18.9% from the corresponding period of
2010.
- Operating income: RMB72.7 million (US$11.4 million),
representing a decrease of 32.6% from the corresponding period of
2010.
- Net income attributable to the company's shareholders: RMB78.2
million (US$12.3 million), representing a decrease of 28.8% from
the corresponding period of 2010. Net income attributable to the
Company's shareholders for the third quarter of 2011 included the
following non-recurring items: (1) impairment losses in respect of
goodwill for the claims adjusting segment and intangible assets;
and (2) professional fees relating to a non-binding going-private
proposal that was later withdrawn.
- Excluding net income from discontinued operations2 and the
non-recurring items mentioned above, adjusted net income
attributable to the Company's shareholders (non-GAAP): RMB106.3
million (US$16.7 million), representing an increase of 5.3% from
the corresponding period of 2010.
- Excluding net income from discontinued operations and the
non-recurring items mentioned above, diluted net income per ADS
(non-GAAP): RMB2.087 (US$0.327), representing an increase of 6.7%,
respectively, from the corresponding period of 2010.
Commenting on the third quarter financial results, Mr. Chunlin
Wang, CNinsure's chief executive officer, stated, "Due largely to
the prevailing macroeconomic turmoil, during the third quarter of
2011 the Chinese insurance industry witnessed a slow-down of
insurance premium growth and, for the first time in the past
decade, the life insurance sector experienced negative growth. This
was a major challenge to our third quarter financial
operations."
Mr. Wang continued, "High inflation is expected to trigger
profound changes to customer demand, sales and marketing models,
the division of labor and the inherent growth drivers in the
Chinese insurance industry. Against this backdrop, CNinsure is also
at a critical junction in its existence. Historically, our business
growth has relied primarily on a people-driven sales model.
However, with rising labor costs and operating expenses, this sales
model and the sustainability of our long-term growth is
increasingly under pressure. In the coming two to three years, we
intend to alter the factors that drive our growth by transforming
our operating tactics and sales and marketing model to more clearly
define our market positioning and target customers. As we do so, we
will focus our efforts mainly on the following areas:
a) concentrating resources on key cities and
cutting back our presence in regions at or below the county
level;
b) shifting to high value-added businesses;
c) encouraging innovation in product design in
order to meet the rising demands of medium-to-high-end customers
for diversified financial services and products and avoid
homogeneous competition;
d) building a customer-centric integrated e-commerce
platform that provides comprehensive personal financial services
from any location and at any time in order to improve customer
loyalty and reduce the our reliance on sales agents;
e) targeting medium-to-high-end customers by
establishing a professional and high-caliber sales team specialized
in providing financial advisory services; and
f) adopting specialized distribution channels
to sell homogeneous products by consolidating market resources, in
particular, from ancillary insurance intermediaries.
As we implement these strategic moves, we may experience a
slowdown in growth during the coming two to three years, but we are
confident that after these adjustments, CNinsure will have been
transformed into a brand-powered and high-tech company that
provides high value-added products to high-end customers, and that
it will be back on the track of strong profits and high
growth."
Financial Results for the Third Quarter Ended Sep 30,
2011
Total net revenues were RMB383.7 million
(US$60.2 million) for the third quarter of 2011, representing an
increase of 18.9% from RMB322.6million for the corresponding period
of 2010. The increase was primarily driven by the 22.6%
year-over-year growth of commissions derived from the property and
casualty insurance business as a result of sales volume growth and
rise in the property and casualty insurance commission rate, while
commissions derived from the life insurance and claims adjusting
businesses recorded modest year-over-year growth of 11.8% and
10.9%, respectively.
Total operating costs and expenses were
RMB311.0 million (US$48.8 million) for the third quarter of 2011,
representing an increase of 44.8% from RMB214.7 million for the
corresponding period of 2010.
Commissions and fees expenses were RMB192.9
million (US$30.2 million) for the third quarter of 2011,
representing an increase of 40.5% from RMB137.3 million for the
corresponding period of 2010. The increase was primarily due to
sales growth and largely tracked the increase in the rate of
commissions paid to sales agents.
Selling expenses were RMB20.0 million (US$3.1
million) for the third quarter of 2011, representing an
increase of 36.7% from RMB14.6 million for the corresponding period
of 2010, primarily due to sales growth and an increase in payroll
expense as a result of increased headcount and pay raises for
employees at sales outlets.
General and administrative expenses were
RMB98.1 million (US$15.4 million) for the third quarter of 2011,
representing an increase of 56.2% from RMB62.8 million for the
corresponding period of 2010. The increase was primarily
attributable to the following items:
(1) an increase of 675.2% in professional fees from
RMB1.3 million for the third quarter of 2010 to RMB10.2 million
(US$1.6 million) for the third quarter of 2011 which included
approximately RMB10.0 million (US$1.6 million) in financial advisor
and legal fees incurred in relation to the non-binding
going-private proposal which the Company received on May 14, 2011
and was withdrawn on September 15, 2011;
(2) an increase of 37.7% in payroll expense from
RMB19.3 million for the third quarter of 2010 to RMB26.5 million
(US$4.2 million) for the third quarter of 2011 primarily due to pay
raises for our administrative staff;
(3) an increase of 34.0% in amortization of
intangible assets from RMB5.0 million for the third quarter of 2010
to RMB6.7 million (US$1.1 million) for the third quarter of 2011,
largely resulting from acquisitions made after June 30, 2010;
and
(4) the recognition of a RMB7.0 million (US$1.1
million) impairment loss in respect of intangible assets and a
RMB12.9 (US$2.0 million) impairment loss in respect of goodwill for
the claims adjusting segment.
The increase in the general administrative expense was partially
offset by a decrease of 23.0% in share-based compensation expenses
from RMB5.9 million for the third quarter of 2010 to RMB4.6 million
(US$0.7 million) for the third quarter of 2011, as a result of
stock option forfeitures in the third quarter of 2011.
As a result of the foregoing factors, operating
income was RMB72.7 million (US$11.4 million) for the third
quarter of 2011, representing a decrease of 32.6% from RMB107.9
million for the corresponding period of 2010. Operating
margin was 18.9% for the third quarter of
2011, compared to 33.4% for the corresponding period of 2010.
Interest income for the third quarter of 2011
was RMB13.6 million (US$2.1 million), representing an increase of
88.8% from RMB7.2 million for the corresponding period of 2010,
primarily due to an increase in bank deposits and interest
rates.
Other income for the third quarter of 2011 was
RMB9.3 million (US$1.5 million), primarily due to a cash bonus of
RMB8.0 million (US$1.3 million) granted to an affiliated subsidiary
of CNinsure by the Shenzhen municipal government.
Income tax expense for the third quarter of
2011 was RMB22.3 million (US$3.5 million), representing an increase
of 16.3% from RMB19.1 million for the corresponding period of 2010.
The effective income tax rate applicable to the Company was 23.3%
for the third quarter of 2011, compared to 16.6% for the
corresponding period of 2010.
Net income from continuing
operations was RMB76.3 million (US$12.0 million) for the
third quarter of 2011, representing a decrease of 22.5% from
RMB98.5 million for the corresponding period of 2010.
Net margin for continuing
operations was 19.9% for the third quarter of 2011
compared to 30.5% for the corresponding period of 2010.
Net income from discontinued operations was nil
for the third quarter of 2011. Net income from discontinued
operations was RMB8.8 million for the third quarter of 2010.
Net income attributable to the Company's
shareholders was RMB78.2 million (US$12.3 million) for the
third quarter of 2011, representing a decrease of 28.8% from
RMB109.8 million for the corresponding period of 2010. Net income
attributable to the Company's shareholders for the third quarter of
2011 included the following non-recurring items: (1) the
recognition of impairment losses in respect of goodwill for the
claims adjusting segment and intangible assets; and (2)
professional fees relating to a non-binding going-private proposal
that was later withdrawn.
Excluding net income from discontinued operations and the
non-recurring items mentioned above, net income
attributable to the Company's shareholders (non-GAAP) was
RMB106.3 million (US$16.7 million) for the third quarter of 2011,
representing an increase of 5.3% from RMB101.0 million from the
corresponding period of 2010.
Basic net income per ADS from continuing
operations was RMB1.560 (US$0.245) for the third quarter
of 2011, representing a decrease of 22.8% from RMB2.022 for the
corresponding period of 2010. Fully diluted net income per ADS from
continuing operations was RMB1.534 (US$0.241) for the third quarter
of 2011, representing a decrease of 21.6% from RMB1.957 for the
corresponding period of 2010.
Basic net income per ADS was RMB1.560
(US$0.245) for the third quarter of 2011, representing a decrease
of 29.0% from RMB2.198 for the corresponding period of 2010. Fully
diluted net income per ADS was RMB1.534 (US$0.241) for the third
quarter of 2011, representing a decrease of 27.9% from RMB2.128 for
the corresponding period of 2010.
Non-GAAP adjusted fully diluted net income per
ADS which excluded net income from discontinued operations
and the non-recurring items mentioned above was RMB2.087
(US$0.327), representing an increase of 6.7% from RMB1.957 for the
corresponding period of 2010.
As of September 30, 2011, the Company had RMB2.4 billion
(US$383.1 million) in cash and cash
equivalents.
Recent Developments:
- On November 18, 2011, the Board of Directors of CNinsure
approved a resolution to cancel the following outstanding stock
options: (1) options to purchase an aggregate of 27,671,884
ordinary shares at an exercise price of US$0.8395 per ordinary
shares, which were granted to certain directors, officers and
employees on February 8, 2010; and (2) options to purchase an
aggregate of 16,974,600 ordinary shares at an exercise price of
US$0.734 per ordinary share, which were granted to certain
directors, officers and employees on April 28, 2011. As a result of
the cancellation, a one-off charge of RMB48.2 million is expected
to be recognized in the fourth quarter of 2011. As of the effective
date of the cancellation, options to purchase 37,134,301 ordinary
shares were still outstanding.
- On November 10, 2011, CNinsure was named to Forbes Asia's "Top
200 Best Under a Billion" for 2011. It was also named one of the
"Top 100 Fastest-Growing Companies" for 2011 by Fortune magazine on
September 13, 2011, ranking 61st in the list. Selection for both
awards was based upon earnings growth, sales growth and
shareholders' return on equity over the past 12 months and the past
three years.
- On October 31, 2011, the Company commenced trial operation of
its price comparison website for public testing. During the trial
operation period, the website is open to its sales agents and
existing clients only. Public testing will focus on payment system
connection, information system support and call center operation.
As of the date of this announcement, the Company has entered into
agreements with four domestic third-party payment service providers
and has successfully connected the price comparison website, the
internal databases of several insurers and the third-party payment
platforms. Total spending for the construction of the
e-commerce platform for the third quarter of 2011 was RMB6.4
million (US$1.0 million), being primarily comprised of research and
development costs, including and payroll costs for research and
development professionals.
- As of September 30, 2011, the management of CNinsure had
repurchased 50,000 ADS for an aggregate price of approximately
US$0.3 million on the open market.
- As of September 30, 2011, CNinsure's distribution and service
network consisted of 593 sales and services outlets operating in 23
provinces, compared to 5433 sales and service outlets operating in
23 provinces as of September 30, 2010. CNinsure had 43,643 sales
agents and 1,334 professional claims adjustors as of September 30,
2011, compared to 39,2324 sales agents and 1,488 professional
claims adjustors as of September 30, 2010.
- On September 20, 2011, CNinsure announced the signing of a
strategic partnership agreement with Chartis Insurance Company
China Limited ("Chartis Insurance"), a subsidiary of Chartis, Inc.
Pursuant to the agreement, both parties will work closely on agent
and personnel training, operation management, product distribution,
developing custom insurance products, e-commerce and outsourcing
claims adjusting services. As of September 30, 2011, CNinsure had
entered into e-commerce strategic partnerships with three property
and casualty insurance companies, namely, Chartis Insurance, China
Pacific Property Insurance Co., Ltd. and Sunshine Property and
Casualty Insurance Co., Ltd.
- On August 31, 2011, CNinsure entered into definitive agreements
to acquire 100% of the equity interest in each of Guangzhou Huajie
Insurance Agency Co., Ltd. and Dongguan Zhongxin Insurance Agency
Co., Ltd. for RMB25 million each.
- Net revenues from commissions and fees derived from the
property and casualty insurance, life insurance and claims
adjusting businesses for the third quarter of 2011 each contributed
69.3%, 16.9%, and 13.8% of the Company's total net revenues,
respectively, compared to 67.2%, 18.0%5, 14.8%, respectively, in
the corresponding period of 2010.
Business Outlook
CNinsure expects its total net revenues from continuing
operations to grow by approximately10-15% for the fourth quarter of
2011 compared to the corresponding period of 2010. This forecast
reflects CNinsure's current and preliminary view, which is subject
to change.
Conference Call
The Company will host a conference call to discuss the third
quarter 2011 results at
Time: |
8pm Eastern Standard Time on November 21,
2011 |
|
or 9am Beijing/Hong Kong Time on November 22,
2011 |
The dial-in numbers: |
|
|
United States |
+1-866-549-1292 |
United Kingdom |
0808-234-6305 |
Canada |
+1-866-869-1825 |
Singapore |
800-120-5959 |
Taiwan |
0080-113-6336 |
Hong Kong & Other Areas |
+852-3005-2050 |
China
(Mainland) |
400-681-6949 |
Password: |
618842# |
A replay of the call will be available for 30
days as follows:
+852-3005-2020 |
(Hong Kong & Other Areas) |
PIN number: |
147257# |
Additionally, a live and archived web cast of this call
will be available at:
http://www.corpasia.net/us/CISG/irwebsite/index.php?mod=event
About CNinsure Inc.
CNinsure is a leading independent intermediary company operating
in China. CNinsure's distribution network reaches many of China's
most economically developed regions and affluent cities. The
Company distributes a wide variety of property and casualty and
life insurance products underwritten by domestic and foreign
insurance companies operating in China, and provides insurance
claims adjusting as well as other insurance-related services.
Forward-looking Statements
This press release contains statements of a forward-looking
nature. These statements are made under the "safe harbor"
provisions of the U.S. Private Securities Litigation Reform Act of
1995. You can identify these forward- looking statements by
terminology such as "will," "expects," "believes," "anticipates,"
"intends," "estimates" and similar statements. Among other things,
the management's quotations and the Business Outlook section
contain forward-looking statements. These forward-looking
statements involve known and unknown risks and uncertainties and
are based on current expectations, assumptions, estimates and
projections about CNinsure and the industry. Potential risks and
uncertainties include, but are not limited to, those relating to
CNinsure's limited operating history, especially its limited
experience in selling life insurance products, its ability to
attract and retain productive agents, especially entrepreneurial
agents, its ability to maintain existing and develop new business
relationships with insurance companies, its ability to execute its
growth strategy, its ability to adapt to the evolving regulatory
environment in the Chinese insurance industry, its ability to
compete effectively against its competitors, quarterly variations
in its operating results caused by factors beyond its control and
macroeconomic conditions in China and their potential impact on the
sales of insurance products. All information provided in this press
release is as of November 22, 2011, and CNinsure 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 CNinsure
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 CNinsure is included in CNinsure's filings
with the U.S. Securities and Exchange Commission, including its
annual report on Form 20-F.
About Non-GAAP Financial Measures
In addition to CNinsure's consolidated financial results under
GAAP, the Company also provides non-GAAP financial measures,
including (1) non-GAAP net income attributable to shareholders for
the third quarter of 2011 and the corresponding period of 2010,
representing net income attributable to shareholders excluding (a)
net income from discontinued operations for the third quarter of
2010, (b) impairment losses in respect of goodwill for the claims
adjusting business segment and for intangible assets and (c)
professional fees relating to a non-binding going-private proposal
that was later withdrawn for the third quarter of 2011; and (2)
non-GAAP diluted net income per ADS for the third quarter of 2011
and the corresponding period of 2010, representing diluted net
income per ADS excluding (a) net income from discontinued
operations for the third quarter of 2010 (b) impairment losses in
respect of goodwill for the claims adjusting business segment and
for intangible assets and (c) professional fees relating to a
non-binding going-private proposal that was later withdrawn for the
third quarter of 2011.
The Company believes that both management and investors benefit
from referring to these non-GAAP financial measures in assessing
the Company's performance and when planning and forecasting future
periods. One limitation of using these non-GAAP financial measures
is that these non-GAAP measures exclude the net income from
discontinued operations for the third quarter of 2010 impairment
losses in respect of goodwill for the claims adjusting business
segment and for intangible assets and professional fees relating to
a non-binding going-private proposal that was later withdrawn for
the third quarter of 2011, which income was significant in the
third quarter of 2011 and the corresponding period of 2010. The
presentation of these non-GAAP financial measures is not intended
to be considered in isolation or as a substitute for the financial
information prepared and presented in accordance with GAAP. For
more information on these non-GAAP financial measures, please see
the tables captioned "Reconciliations of GAAP Financial Measures to
Non-GAAP Financial Measures" set forth at the end of this
release.
1This announcement contains translations of certain Renminbi
(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
RMB6.378 to US$1.00, the effective noon buying rate as of Sep 30,
2011 in The City of New York for cable transfers of RMB as set
forth in H.10 weekly statistical release of the Federal Reserve
Board.
2Following the sale of Beijing Datong Investment
Management Co., Ltd. ("Datong"), a company primarily engaged
in the distribution of life insurance products, to Winner Sight
Global Limited, an affiliated entity of Warburg Pincus LLC, on
March 25, 2011, the Company is required to present its financial
results on both a continuing and discontinued basis. Profits and
losses related to Datong are presented as discontinued operations
while profits and losses for the remaining business are presented
as continuing operations.
3Excluding the sales and service outlets of Datong
4Excluding the sales agents of Datong
5Excluding the operations of Datong.
CNINSURE INC.
Unaudited Condensed Consolidated Balance Sheets
(In thousands) |
|
|
|
|
|
|
|
|
As of December 31,
2010 |
As of
September
30,
2011 |
As of
September
30,
2011 |
|
RMB |
RMB |
US$ |
ASSETS: |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
1,924,884 |
2,443,488 |
383,112 |
Restricted cash |
9,177 |
7,202 |
1,129 |
Short term investment |
— |
33,600 |
5,268 |
Accounts receivable, net |
243,175 |
189,249 |
29,672 |
Insurance premium receivables |
92 |
6 |
1 |
Other receivables |
67,034 |
71,565 |
11,221 |
Deferred tax assets |
5,691 |
4,643 |
728 |
Amounts due from related parties |
40,000 |
2,000 |
314 |
Other current assets |
12,372 |
12,648 |
1,983 |
Total current assets |
2,302,425 |
2,764,401 |
443,428 |
|
|
|
|
Non-current assets: |
|
|
|
Property, plant, and equipment, net |
102,175 |
90,033 |
14,116 |
Goodwill |
1,154,373 |
1,066,394 |
167,199 |
Intangible assets, net |
145,653 |
114,353 |
17,929 |
Deferred tax assets |
6,755 |
4,074 |
639 |
Investment in affiliates |
139,116 |
148,033 |
23,210 |
Other non-current assets |
3,959 |
4,708 |
738 |
Total non-current
assets |
1,552,031 |
1,427,595 |
223,831 |
Total assets |
3,854,456 |
4,191,996 |
657,259 |
|
|
|
|
CNINSURE INC.
Unaudited Condensed Consolidated Balance
Sheets-(Continued) |
|
|
|
(In
thousands) |
|
|
|
|
As of December 31,
2010 |
As of
September
30,
2011 |
As of
September
30,
2011 |
|
RMB |
RMB |
US$ |
LIABILITIES AND EQUITY: |
|
Current liabilities: |
|
|
|
Accounts payable (including accounts payable
of the consolidated variable interest entities ("VIEs") without
recourse to CNinsure Inc. of RMB75,285 and RMB59,576
(US$9,341) as of December 31, 2010 and September 30, 2011,
respectively). |
89,573 |
69,327 |
10,870 |
Insurance premium payables (including
insurance premium payables of the consolidated VIEs without
recourse to CNinsure Inc. of RMB1,364 and RMB1,063 (US$167) as of
December 31, 2010 and September 30, 2011, respectively) |
1,364 |
1,063 |
167 |
Other payables and accrued expenses
(including other payables and accrued expense of the
consolidated VIEs without recourse to CNinsure Inc. of
RMB52,725 and RMB28,960 (US$4,541) as of December 31, 2010
and September 30, 2011, respectively). |
93,460 |
80,664 |
12,647 |
Accrued payroll (including accrued payroll of
the consolidated VIEs without recourse to CNinsure Inc. of
RMB27,158 and RMB29,723 (US$4,660) as of December 31, 2010
and September 30, 2011, respectively) |
31,237 |
32,918 |
5,161 |
Income tax payable (including income tax
payable of the consolidated of VIEs without recourse to CNinsure
Inc. of RMB32,134 and RMB19,453 (US$3,050) as of December 31,
2010 and September 30, 2011, respectively). |
34,927 |
59,872 |
9,387 |
Amounts due to related parties (including
amounts due to related parties of the consolidated of VIEs
without recourse to CNinsure Inc. of RMB7,800 and Nil as of
December 31, 2010 and September 30, 2011, respectively) |
37,800 |
— |
— |
Total current
liabilities |
288,361 |
243,844 |
38,232 |
|
|
|
|
CNINSURE
INC. |
Unaudited Condensed
Consolidated Balance Sheets-(Continued) |
|
|
|
|
(In
thousands) |
|
|
|
|
|
As of December 31,
2010 |
As of September 30,
2011 |
As of September 30,
2011 |
|
RMB |
RMB |
US$ |
Non-current
liabilities: |
|
|
|
Other tax liabilities (including non-current
portion of other tax liabilities of the consolidated
VIEs without recourse to CNinsure Inc. of Nil and Nil as
of December 31, 2010 and September 30, 2011,
respectively) |
5,519 |
12,709 |
1,993 |
Deferred tax liabilities (including
non-current portion of deferred tax liabilities of the consolidated
VIEs without recourse to CNinsure Inc. of Nil and Nil as
of December 31, 2010 and September 30, 2011,
respectively) |
43,513 |
35,840 |
5,619 |
Total non-current
liabilities |
49,032 |
48,549 |
7,612 |
Total liabilities |
337,393 |
292,393 |
45,844 |
|
|
|
|
Ordinary shares |
7,649 |
7,646 |
1,199 |
Additional paid-in capital |
2,261,849 |
2,260,872 |
354,480 |
Statutory reserves |
136,681 |
133,143 |
20,875 |
Retained earnings |
738,165 |
1,160,958 |
182,025 |
Accumulated other comprehensive
loss |
(83,360) |
(96,843) |
(15,183) |
Total CNinsure Inc. shareholders'
equity |
3,060,984 |
3,465,776 |
543,396 |
Noncontrolling interests |
456,079 |
433,827 |
68,019 |
Total equity |
3,517,063 |
3,899,603 |
611,415 |
Total liabilities and
equity |
3,854,456 |
4,191,996 |
657,259 |
CNINSURE
INC. |
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited Condensed
Consolidated Statements of Operations |
|
|
(In thousands, except
for shares and per share data) |
|
|
|
|
|
|
For The Three
Months Ended |
For The Nine
Months Ended |
|
September
30, |
September
30, |
|
2010 |
2011 |
2011 |
2010 |
2011 |
2011 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
Net
revenues: |
|
|
|
|
|
Commissions and fees |
322,358 |
381,449 |
59,807 |
869,866 |
1,095,385 |
171,744 |
Other service fees |
226 |
2,224 |
349 |
312 |
2,688 |
422 |
Total net revenues |
322,584 |
383,673 |
60,156 |
870,178 |
1,098,073 |
172,166 |
Operating costs and
expenses: |
|
|
|
|
Commissions and fees |
(137,261) |
(192,902) |
(30,245) |
(393,729) |
(551,578) |
(86,481) |
Selling expenses |
(14,602) |
(19,963) |
(3,130) |
(42,015) |
(57,918) |
(9,081) |
General and administrative
expenses |
(62,835) |
(98,124) |
(15,385) |
(170,065) |
(223,387) |
(35,025) |
Total operating costs and
expenses |
(214,698) |
(310,989) |
(48,760) |
(605,809) |
(832,883) |
(130,587) |
Income from operations |
107,886 |
72,684 |
11,396 |
264,369 |
265,190 |
41,579 |
Other income,
net: |
|
|
|
|
|
Investment income |
— |
— |
— |
38,050 |
— |
— |
Interest income |
7,221 |
13,635 |
2,138 |
19,556 |
35,450 |
5,558 |
Others, net |
40 |
9,301 |
1,458 |
297 |
10,432 |
1,636 |
Income from continuing operations
before income taxes and income of affiliates and discontinued
operations |
115,147 |
95,620 |
14,992 |
322,272 |
311,072 |
48,773 |
Income tax expense |
(19,143) |
(22,272) |
(3,492) |
(64,347) |
(65,447) |
(10,262) |
Share of income of affiliates |
2,472 |
2,989 |
469 |
9,807 |
8,316 |
1,304 |
Net income from continuing
operations |
98,476 |
76,337 |
11,969 |
267,732 |
253,941 |
39,815 |
Net income from discontinued
operations, net of tax |
8,829 |
— |
— |
26,728 |
157,253 |
24,656 |
Net income |
107,305 |
76,337 |
11,969 |
294,460 |
411,194 |
64,471 |
Less: net gain (loss) attributable to
noncontrolling interests |
(2,485) |
(1,834) |
(287) |
(1,314) |
(8,066) |
(1,264) |
Net income attributable to the
Company's shareholders |
109,790 |
78,171 |
12,256 |
295,774 |
419,260 |
65,735 |
|
CNINSURE
INC. |
Unaudited Condensed
Consolidated Statements of Operations-(Continued) |
(In thousands, except
for shares and per share data) |
|
|
|
|
|
|
|
|
For The Three
Months Ended |
For The Nine
Months Ended |
|
September
30, |
September
30, |
|
2010 |
2011 |
2011 |
2010 |
2011 |
2011 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
Net income per share: |
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
Net income from continuing
operations |
0.101 |
0.078 |
0.012 |
0.286 |
0.261 |
0.041 |
Net income from discontinued
operations |
0.009 |
— |
— |
0.028 |
0.157 |
0.025 |
Net income |
0.110 |
0.078 |
0.012 |
0.314 |
0.418 |
0.066 |
Diluted: |
|
|
|
|
|
|
Net income from continuing
operations |
0.098 |
0.077 |
0.012 |
0.276 |
0.256 |
0.040 |
Net income from discontinued
operations |
0.008 |
— |
— |
0.027 |
0.154 |
0.024 |
Net income |
0.106 |
0.077 |
0.012 |
0.303 |
0.410 |
0.064 |
Net income per ADS: |
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
Net income from continuing
operations |
2.022 |
1.560 |
0.245 |
5.715 |
5.225 |
0.819 |
Net income from discontinued
operations |
0.176 |
— |
— |
0.567 |
3.136 |
0.492 |
Net income |
2.198 |
1.560 |
0.245 |
6.282 |
8.361 |
1.311 |
Diluted: |
|
|
|
|
|
|
Net income from continuing
operations |
1.957 |
1.534 |
0.241 |
5.516 |
5.124 |
0.803 |
Net income from discontinued
operations |
0.171 |
— |
— |
0.548 |
3.075 |
0.482 |
Net income |
2.128 |
1.534 |
0.241 |
6.064 |
8.199 |
1.285 |
|
|
|
|
|
|
|
Shares used in calculating net income
per share: |
998,795,320 |
1,002,365,585 |
1,002,365,585 |
941,600,652 |
1,002,905,439 |
1,002,905,439 |
Basic |
|
|
|
|
|
|
Diluted |
1,031,977,186 |
1,019,042,812 |
1,019,042,812 |
975,563,550 |
1,022,752,642 |
1,022,752,642 |
|
CNINSURE
INC. |
Unaudited Condensed
Consolidated Statements of Cash Flow |
(In
thousands) |
|
|
|
|
|
|
|
|
For the Three
Months Ended |
For The Nine
Months Ended |
|
September
30, |
September
30, |
|
2010 |
2011 |
2011 |
2010 |
2011 |
2011 |
|
RMB |
RMB |
US$ |
RMB |
RMB |
US$ |
OPERATING ACTIVITIES |
|
|
|
|
|
|
Net income |
107,305 |
76,337 |
11,969 |
294,460 |
411,194 |
64,471 |
Adjustments to reconcile net income
to net cash generated from operating activities: |
|
|
|
|
|
|
Depreciation |
8,992 |
6,704 |
1,051 |
22,505 |
20,658 |
3,239 |
Amortization of acquired intangible
assets |
5,340 |
6,719 |
1,053 |
14,257 |
19,971 |
3,131 |
Impairment loss for acquired intangible
assets |
— |
7,000 |
1,098 |
— |
7,000 |
1,097 |
Impairment loss for goodwill |
— |
12,865 |
2,017 |
— |
12,865 |
2,017 |
Allowance for doubtful receivables |
1,000 |
1,315 |
206 |
3,795 |
568 |
89 |
Compensation expenses associated with stock
options |
5,913 |
4,552 |
715 |
16,272 |
7,502 |
1,176 |
Loss (gain) on disposal of property, plant
and equipment |
17 |
(42) |
(7) |
(105) |
165 |
26 |
Gain on disposal of subsidiaries |
— |
— |
— |
— |
(157,253) |
(24,655) |
Investment income |
— |
— |
— |
(38,050) |
— |
— |
Share of income of affiliates |
(2,472) |
(2,989) |
(469) |
(9,807) |
(8,316) |
(1,304) |
Deferred taxes |
(3,324) |
(7,711) |
(1,209) |
1,582 |
(29,952) |
(4,696) |
Changes in operating assets and
liabilities |
(28,944) |
(25,230) |
(3,956) |
(66,607) |
42,878 |
6,723 |
Net cash generated from operating
activities |
93,827 |
79,520 |
12,468 |
238,302 |
327,280 |
51,314 |
|
|
|
|
|
|
|
Cash flows from investing
activities: |
|
|
|
|
|
|
Addition in other investments |
(300) |
(19,450) |
(3,049) |
(625) |
(34,350) |
(5,385) |
Addition in investment in
affiliates |
(39,510) |
(600) |
(94) |
(39,510) |
(600) |
(94) |
Purchase of property, plant and
equipment |
(7,792) |
(2,252) |
(353) |
(19,637) |
(18,114) |
(2,840) |
Purchase of intangible |
— |
(758) |
(119) |
— |
(758) |
(119) |
Proceeds from disposal of property and
equipment |
373 |
90 |
14 |
1,082 |
802 |
126 |
Acquisition of subsidiaries, net of cash
acquired |
— |
(49,996) |
(7,839) |
(195,318) |
(49,996) |
(7,839) |
Repayments to related parties |
— |
— |
— |
(17,438) |
— |
— |
Decrease (increase) in restricted
cash |
704 |
(1,018) |
(159) |
(7,656) |
1,975 |
310 |
Proceeds from disposal of subsidiaries, net
of cash |
— |
(75) |
(12) |
(2,527) |
394,388 |
61,835 |
Amounts due from related party |
— |
(2,000) |
(314) |
— |
(2,000) |
(314) |
Net cash generated from (used in)
investing activities |
(46,525) |
(76,059) |
(11,925) |
(281,629) |
291,347 |
45,680 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing
activities: |
|
|
|
|
|
|
Payment for contingent
consideration |
— |
— |
— |
(102,780) |
(100,000) |
(15,679) |
Acquisition of additional interest in a
subsidiary |
— |
— |
— |
(2,410) |
— |
— |
Increase in capital injection by
noncontrolling interests |
6,890 |
(4,547) |
(713) |
12,295 |
1,940 |
304 |
Repayments from related parties |
(39,564) |
— |
— |
11,093 |
20,000 |
3,136 |
Proceeds from share issuances |
744,105 |
— |
— |
744,105 |
— |
— |
Proceeds on exercise of stock
options |
114 |
470 |
74 |
2,754 |
5,242 |
822 |
Repurchase of ordinary shares |
— |
— |
— |
— |
(13,722) |
(2,151) |
Dividends paid |
(40,863) |
— |
— |
(80,985) |
— |
— |
Net cash used in financing
activities |
670,682 |
(4,077) |
(639) |
584,072 |
(86,540) |
(13,568) |
|
|
|
|
|
|
|
Net increase (decrease) in cash and
cash equivalents |
717,984 |
(616) |
(96) |
540,745 |
532,087 |
83,426 |
Cash and cash equivalents at
beginning of period |
1,280,603 |
2,449,849 |
384,109 |
1,457,890 |
1,924,884 |
301,800 |
Effect of exchange rate changes on cash and
cash equivalents |
(7,373) |
(5,745) |
(901) |
(7,421) |
(13,483) |
(2,114) |
Cash and cash equivalents at end of
period |
1,991,214 |
2,443,488 |
383,112 |
1,991,214 |
2,443,488 |
383,112 |
|
|
|
|
|
|
|
Interest paid |
— |
— |
— |
— |
— |
— |
Income taxes paid |
33,400 |
17,820 |
2,794 |
82,029 |
81,009 |
12,701 |
CNinsure
Inc. |
Reconciliations of GAAP
Financial Measures to Non-GAAP Financial
Measures |
(In RMB in thousands,
except shares and per share data) |
|
|
|
|
|
|
|
GAAP |
|
|
|
Non-GAAP |
|
|
|
|
|
|
Net income attributable to the Company's
shareholders |
109,790 |
(8,829) |
— |
— |
100,961 |
|
|
|
|
|
|
Shares used in calculating diluted net income
per ADS |
1,031,977,186 |
— |
— |
— |
1,031,977,186 |
|
|
|
|
|
|
Diluted net income per ADS |
2.128 |
(0.171) |
— |
— |
1.957 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
|
|
Non-GAAP |
|
|
|
|
|
|
Net income attributable to the Company's
shareholders |
78,171 |
— |
10,045 |
18,115 |
106,331 |
|
|
|
|
|
|
Shares used in calculating diluted net income
per ADS |
1,019,042,812 |
— |
— |
— |
1,019,042,812 |
|
|
|
|
|
|
Diluted net income per ADS |
1.534 |
— |
0.197 |
0.356 |
2.087 |
|
|
|
|
|
|
Net income from discontinued
operations income, net of tax; |
|
|
|
|
|
one-off professional fees related
to the non-binding going-private proposal; |
|
|
|
|
a recognition of impairment loss
in respect of intangible assets and
goodwill. |
|
|
|
|
CONTACT: Oasis Qiu
Investor Relations Manager
Tel: +86 (20) 6122-2777 x 850
Email: qiusr@cninsure.net
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