Fanhua Inc., (Nasdaq:FANH), (the "Company" or "Fanhua"), a leading
independent online-to-offline ("O2O") financial services provider
in China, today announced its unaudited financial results for the
fourth quarter and fiscal year ended December 31, 20171.
On March 9, 2018, its Board of Directors
declared a quarterly dividend of US$0.01 per ordinary share, or
US$0.20 per ADS, amounting to a total of US$13.0 million, which
represents 66.7% of the Company's net income attributable to
shareholders for the fourth quarter of 2017. The dividend will be
payable on or around April 10, 2018 to shareholders of record on
March 26, 2018.
Financial Highlights for
the Fourth Quarter of
2017:
|
(In thousands, except per ADS) |
2016Q4(RMB) |
2017Q4(RMB) |
2017Q4(US$) |
Change % |
|
Total net revenues |
1,323,378 |
690,476 |
106,124 |
-47.8 |
|
Operating income |
21,344 |
62,143 |
9,551 |
191.1 |
|
Net income attributable to the Company’s shareholders2 |
74,594 |
126,874 |
19,500 |
70.1 |
|
Diluted net income per ADS |
1.23 |
1.98 |
0.30 |
61.0 |
Financial Highlights for Year
2017:
|
(In thousands, except per ADS) |
2016(RMB) |
2017(RMB) |
2017(US$) |
Change % |
|
Total net revenues |
4,082,884 |
|
4,088,473 |
628,386 |
0.1 |
|
Operating (loss) income |
(8,466 |
) |
273,136 |
41,980 |
N/A |
|
Net income attributable to the Company’s shareholders |
157,047 |
|
449,228 |
69,045 |
186.0 |
|
Diluted net income per ADS |
2.60 |
|
7.29 |
1.13 |
180.4 |
Commenting on the fourth quarter and fiscal year 2017 financial
results, Mr. Chunlin Wang, chairman and chief executive officer of
Fanhua, stated, "Owing to strong performance in the past four
quarters, our total operating income in 2017 grew to RMB273.1
million, far above our previous expectation of RMB180 million, and
net income attributable to shareholders grew by 186.0%
year-over-year to RMB449.2 million.
"During the fourth quarter of 2017, the Chinese
life insurance industry reported single digit year-over-year growth
of 2.4% following the implementation of Circular No. 134, which
banned the fast-return feature of annuity and endowment insurance
products and prohibited life insurers from selling universal life
insurance as an add-on to regular life policies. Against this
backdrop, we still achieved 50% year-over-year growth in life
insurance premiums in the same period which contributed to
year-over-year growth of approximately 191.1% to RMB62.1 million in
our operating income, once again beating
guidance.
"As we enter 2018, new premiums were down across
the life insurance market during the Jumpstart sales season, due to
the drastic decline in the sales of annuity and universal products
which used to be the major contributors behind the rapid growth in
life insurance premiums in the past two years. Sales in these
products have decreased mainly as a result of high bond yields and
CIRC-guided product changes towards higher protection features in
new product design. Despite that, we believe that the structural
growth of the life insurance market will continue as there is still
significant room for more growth in the sales of
protection-oriented life insurance products.
"As for Fanhua, protection-oriented insurance
products have always been and will continue to be our focus. With
continued growth in the life insurance business, we are optimistic
that our operating income will grow by approximately 40%
year-over-year in 2018."
Financial Results for the Fourth
Quarter of 2017
Total net revenues were
RMB690.5 million (US$106.1 million) for the fourth quarter of 2017,
representing a decrease of 47.8% from RMB1,323.4 million for the
corresponding period in 2016.
- Net revenues for the life
insurance business were RMB490.3
million (US$75.4 million) for the fourth quarter of 2017,
representing an increase of 35.3% from RMB362.3 million for the
corresponding period in 2016. The increase was due to the growth in
the number of sales agents and the rapid growth of renewal
commissions. Revenues generated from our life insurance business
accounted for 71.0% of our total net revenues in the fourth quarter
of 2017.
- Net revenues for the P&C insurance
business were RMB101.9 million (US$15.7 million) for the
fourth quarter of 2017, representing a decrease of 88.1% from
RMB857.4 million for the corresponding period in 2016. The decrease
was primarily due to i) our decision to terminate lower margin
channel businesses starting from the second quarter of 2017 and ii)
implementation of a platform business model for our auto insurance
business beginning the fourth quarter of 2017. Under the new
platform business model, we no longer enter into contracts with
property and casualty insurance companies for the distribution of
auto insurance products through our individual sales agents to earn
profits from the commission spread. Rather, we operate CNpad as a
public auto insurance transaction platform which connects insurance
distributors with our sales agents and charge insurance
distributors technology service fees based on the volume of
insurance premiums they transact through CNpad. A technology
service fee is typically much smaller than the commission we
previously received from insurance companies, though our costs are
minimal. Revenues generated from the P&C insurance business
accounted for 14.8% of our total net revenues in the fourth quarter
of 2017.
- Net revenues for the claims adjusting business
were RMB98.3 million (US$15.1 million) for the fourth quarter of
2017, representing a decrease of 5.2% from RMB103.7 million for the
corresponding period in 2016. Revenues generated from the claims
adjusting business accounted for 14.2% of our total net revenues in
the fourth quarter of 2017.
Total operating costs and
expenses were RMB628.3 million (US$96.6 million) for the
fourth quarter of 2017, representing a decrease of 51.7% from
RMB1,302.0 million for the corresponding period in 2016.
- Commission costs were RMB456.4 million
(US$70.1 million) for the fourth quarter of 2017, representing a
decrease of 53.9% from RMB989.8 million for the corresponding
period in 2016. The decrease in commission cost was mainly due to
the decrease in P&C insurance business, partially offset by the
growth of life insurance business. - Costs of the
life insurance business were RMB314.5 million (US$48.3
million) for the fourth quarter of 2017, representing an increase
of 28.3% from RMB245.1 million for the corresponding period in
2016. The increase was in line with the growth in sales. Costs
incurred by the life insurance business accounted for 68.9% of our
total commission costs in the fourth quarter of 2017.-
Costs of the P&C insurance
business were RMB84.2 million (US$12.9 million) for the
fourth quarter of 2017, representing a decrease of 87.8% from
RMB687.5 million for the corresponding period in 2016. The decrease
was primarily due to the implementation of a platform business
model for our P&C insurance business whereby no cost is
incurred for the platform model. Costs incurred by the P&C
insurance business accounted for 18.5% of our total commission
costs in the fourth quarter of 2017.- Costs of claims
adjusting business were RMB57.6 million (US$8.9 million)
for the fourth quarter of 2017, representing an increase of 0.5%
from RMB57.3 million for the corresponding period in 2016. Costs
incurred by the claims adjusting business accounted for 12.6% of
our total commission costs in the fourth quarter of 2017.
- Selling expenses were RMB61.5 million (US$9.5
million) for the fourth quarter of 2017, representing a decrease of
63.4% from RMB168.1 million for the corresponding period in 2016.
The decrease was primarily because promotional marketing subsidies
were paid to sales agents in the fourth quarter of 2016 for selling
auto insurance policies while there was no such promotional
marketing plan in 2017.
- General and administrative
expenses were RMB110.4
million (US$17.0 million) for the fourth quarter of 2017,
representing a decrease of 23.4% from RMB144.1 million for the
corresponding period in 2016. The decrease was primarily due to a
significant reduction in expenses related to P&C insurance
agencies as a result of the disposal of our P&C insurance
agency subsidiaries in the fourth quarter of 2017, partially offset
by an increase in expenses incurred for setting up new offices and
staff recruitment as a result of regional expansion.
As a result of the preceding factors, we had an
operating income of RMB62.1 million (US$9.6
million) for the fourth quarter of 2017, representing an increase
of 191.1% from RMB21.3 million for the corresponding period in
2016.
Operating margin was 9.0% for
the fourth quarter of 2017, compared to 1.6% for the corresponding
period in 2016.
Investment income was RMB39.5
million (US$6.1 million) for the fourth quarter of 2017,
representing a decrease of 26.6% from RMB53.8 million for the
corresponding period in 2016. The investment income represented
yields from short-term investments in financial products which
mainly consist of inter-bank deposits or collective trust products
with terms ranging from half a year to two years and interest
payable on a quarterly, semi-annual or annual basis. Our investment
income fluctuates from quarter to quarter because investment income
is recognized when received.
Interest income was RMB12.4
million (US$1.9 million) for the fourth quarter of 2017,
representing an increase of 40.3 times from RMB0.3 million for the
corresponding period in 2016, primarily due to interest related to
amounts due from Sincere Fame International Limited ("Sincere
Fame") and Shenzhen Chuangjia Investment Limited Partnership, which
beneficially owns 84.6% of Fanhua Puyi Fund Sales Limited.
Income tax expense was RMB38.1
million (US$5.9 million) for the fourth quarter of 2017,
representing an increase of 102.7% from RMB18.8 million for the
corresponding period in 2016. The effective tax rate for the fourth
quarter of 2017 was 32.9% compared with 25.1% for the corresponding
period in 2016. The increase in effective tax rate was primarily
due to the withholding income tax provided pursuant to dividend
payments in the fourth quarter of 2017.
Share of income of affiliates
was RMB55.2 million (US$8.5 million) for the fourth quarter of
2017, representing an increase of 297.1% from RMB13.9 million for
the corresponding period in 2016, mainly attributable to an
increase of profits from Sincere Fame, a company in which we own
20.6% of the equity interest.
Net income from continuing
operations was RMB132.9 million (US$20.4 million) for the
fourth quarter of 2017, representing an increase of 89.3% from
RMB70.2 million for the corresponding period in 2016.
Net loss (income) from discontinued
operations was RMB1.2 million (US$0.2 million) for the
fourth quarter of 2017, mainly representing the loss from disposal
of the brokerage segment in the fourth quarter. Net income from
discontinued operation was RMB11.7 million for the corresponding
period in 2016, representing net income from operation of brokerage
segment contribute to the Company.
Net income attributable to the Company’s
shareholders was RMB126.9 million (US$19.5 million) for
the fourth quarter of 2017, representing an increase of 70.1% from
RMB74.6 million for the corresponding period in 2016.
Net margin was18.4% for the
fourth quarter of 2017 compared with 5.6% for the corresponding
period in 2016.
Basic and
diluted net income per ADS were RMB1.98
(US$0.30) and RMB1.98 (US$0.30) for the fourth quarter of 2017,
respectively, representing increases of 54.7% and 61.0% from
RMB1.28 and RMB1.23 for the corresponding period in 2016.
Financial Results for Year
2017
Total net revenues were
RMB4,088.5 million (US$628.4 million) for 2017, representing an
increase of 0.1% from RMB4,082.9 million for the corresponding
period in 2016.
- Net revenues for the life
insurance business were
RMB2,424.4 million (US$372.6 million) for 2017, representing an
increase of 144.8% from RMB990.5 million in 2016. The increase was
due to the growth in the number of sales agents and rapid growth of
new policy sales. Revenues generated from our life insurance
business accounted for 59.3% of our total net revenues in
2017.
- Net revenues for the P&C insurance
business were RMB1,355.8 million (US$208.4 million) for
2017, representing a decrease of 50.8% from RMB2,755.9 million in
2016. The decrease was primarily due to i) our decision to
terminate lower margin channel businesses starting from the second
quarter of 2017; ii) implementation of a platform business model
for our auto insurance business beginning the fourth quarter of
2017; and iii) the suspension of business cooperation with PICC
Property and Casualty Company Limited (“PICC P&C”) starting
from March 1, 2017. Revenue generated from our P&C insurance
business accounted for 33.2% of our total net revenue in 2017.
- Net revenues for the claims adjusting business
were RMB308.3 million (US$47.4 million) for 2017, representing a
decrease of 8.4% from RMB336.4 million in 2016. Revenues generated
from the claims adjusting business accounted for 7.5% of our total
net revenues in 2017.
Total operating costs and
expenses were RMB3,815.3 million (US$586.4 million) for
2017, representing a decrease of 6.7% from RMB4,091.4 million in
2016.
- Commission costs were RMB3,059.4 million
(US$470.2 million) for 2017, representing a decrease of 1.5% from
RMB3,106.6 million in 2016. The decrease in commission cost was
mainly due to the decrease in our P&C insurance business,
partially offset by the growth of our life insurance
business. - Costs of the life insurance
business were RMB1,636.3 million (US$251.5 million) for
2017, representing an increase of 143.1% from RMB673.2 million in
2016. The increase was in line with the growth in sales. Costs
incurred by the life insurance business accounted for 53.5% of our
total commission costs in 2017.- Costs of
the P&C insurance business
were RMB1,228.5 million (US$188.8 million) for 2017, representing a
decrease of 45.0% from RMB2,233.6 million in 2016. The decrease was
primarily due to the implementation of a platform business model
for our P&C insurance business under which no costs are
incurred. Costs incurred by the P&C insurance business
accounted for 40.1% of our total commission costs in 2017.-
Costs of claims adjusting business were RMB194.5 million
(US$29.9 million) for 2017, representing a decrease of 2.7% from
RMB199.8 million in 2016. Costs incurred by the claims adjusting
business accounted for 6.4% of our total commission costs in
2017.
- Selling expenses were RMB221.8million (US$34.1
million) for 2017, representing a decrease of 55.9% from RMB502.8
million in 2016. The decrease was primarily because promotional
marketing subsidies were paid to sales agents in the fourth quarter
of 2016 for selling auto insurance policies while there was no such
promotional marketing plan in 2017.
- General and administrative
expenses were
RMB534.1million (US$82.1 million) for 2017, representing an
increase of 10.8% from RMB481.9 million in 2016. The increase was
primarily due to an increase in expenses incurred for setting up
new offices and staff recruitment as a result of regional expansion
offset by the reduction in expenses related to P&C insurance
agencies as a result of the disposal of most of our P&C
insurance agency subsidiaries in the fourth quarter of 2017.
As a result of the preceding factors, we had an
operating income of RMB273.1 million (US$42.0
million) for 2017, compared with an operating loss of RMB8.5
million in 2016.
Operating margin was 6.7% for
2017, compared to negative 0.2% in 2016.
Investment income was
RMB191.8million (US$29.5 million) for 2017, representing an
increase of 66.3% from RMB115.3 million in 2016. The investment
income represented yields from short-term investments in financial
products which mainly consist of inter-bank deposits or collective
trust products with terms ranging from half-a-year to two years and
interest payable on a quarterly, semi-annual or annual basis. Our
investment income fluctuates from quarter to quarter because
investment income is recognized when received.
Interest income was RMB25.9
million (US$4.0 million) for 2017, representing an increase of
275.4% from RMB6.9 million in 2016, primarily due to interest
related to amounts due from Sincere Fame International Limited
("Sincere Fame") and Shenzhen Chuangjia Investment Limited
Partnership, which beneficially owns 84.6% of Fanhua Puyi Fund
Sales Limited.
Income tax expense was RMB167.8
million (US$25.8million) for 2017, representing an increase of
516.9% from RMB27.2 million in 2016. The effective tax rate for
2017 was 33.2% compared with 22.0% in 2016. The increase in
effective tax rate was primarily due to the withholding income tax
provision related to dividend payments for the second half of
2017.
Share of income of affiliates
was RMB108.9 million (US$16.7 million) for 2017, representing an
increase of 125.5% from RMB48.3 million in 2016, mainly
attributable to an increase of profits from Sincere Fame, a company
in which we own 20.6% of the equity interest.
Net income from continuing
operations was RMB446.2 million (US$68.6 million) for
2017, representing an increase of 207.5% from RMB145.1 million in
2016.
Net income from discontinued
operations was RMB5.5 million (US$0.8 million) for 2017,
mainly representing net income from operation of Brokerage Segment
contribute to the Company. Net income from discontinued operation
was RMB22.5 million in 2016, representing net income from operation
of Brokerage Segment contribute to the Company.
Net income attributable to the Company’s
shareholders was RMB449.2 million (US$69.0 million) for
2017, representing an increase of 186.0% from RMB157.0 million in
2016.
Net margin was 11.0% for 2017
compared with 3.8% in 2016.
Basic and
diluted net income per ADS were RMB7.29
(US$1.13) and RMB7.29 (US$1.13) for 2017, respectively,
representing increases of 169.0% and 180.4% from RMB2.71 and
RMB2.60 in 2016.
As of December 31, 2017, the Company had RMB2,862.5 million
(US$440.0 million) in cash, cash
equivalents and short term
investments.
Key Operational Metrics for Fanhua's Online Initiatives
for 2017:
- CNpad Auto Insurance Mobile Application("CNpad Auto
Insurance App") - Our proprietary mobile sales support
system:- CNpad Auto Insurance App had
been downloaded and activated 365,282 times as of December 31,
2017, representing an increase of 72.0% from 212,317 times as of
December 31, 2016;- The number of active users of CNpad
Auto Insurance App3 was 158,778 in
2017, representing an increase of 103.0% from 78,216 in
2016; - Insurance premiums generated
through CNpad Auto Insurance
App were RMB2.7 billion (US$413.5 million) in
2017, representing a decrease of 11.7% from RMB3.0 billion for
2016.
- Lan Zhanggui - Our one-stop insurance service
platform that integrates the key functions of both CNpad Auto
Insurance and CNpad Life Insurance App, which was launched in
October 2017. All CNpad Life Insurance App accounts have been
converted to Lan Zhanggui. - Lan Zhanggui
had been downloaded and activated 493,360 times as of December 31,
2017, representing an increase of 132.4% from 212,317 times of
downloads of CNpad Life Insurance App as of December 31,
2016;- The number of active users of Lan Zhanggui4
was 126,603 in 2017, representing an increase of 62.0% from 78,126
active users of CNpad Life Insurance App in 2016; -
Insurance premiums generated through
Lan Zhanggui were RMB2.2 billion (US$340.9
million) in 2017, representing an increase of 194.0% from RMB754.4
million generated through CNpad Life Insurance App for 2016.
- eHuzhu - Our online non-profit mutual aid
platform: - The number of registered
members was 2.7 million as of December 31, 2017,
representing an increase of 101.5% from 1.4 million as of December
31, 2016.
- Baoxian.com - Our online insurance
platform:- The number of registered customer
accounts was 1.5 million as of December 31, 2017,
representing an increase of 104.1% from approximately 0.7 million
as of December 31, 2016.- The number of active customer
accounts5 was 185,611 in 2017, representing an increase of
17.0% from 158,683 in 2016;- Insurance premiums generated
on or through Baoxian.com was RMB727.0 million (US$111.7
million) in 2017, representing an increase of 697.1% from RMB91.2
million in 2016.
Recent Developments
- As of December 31, 2017, Fanhua had 506,231 sales agents and
1,226 professional claims, compared with 231,592 sales agents and
1,304 claims adjusters as of December 31, 2016. As of December 31,
2017, Fanhua's distribution network consisted of 502 sales outlets
in 21 provinces and 144 services outlets in 29 provinces, compared
with 746 sales outlets in 21 provinces and 161 service outlets in
29 provinces as of December 31, 2016.
- On December 13, 2017, Fanhua signed a Strategic Partnership
Agreement with Aeon Life Insurance Limited, pursuant to which both
parties will engage in a deep and comprehensive cooperation in a
wide range of areas including product sales, technology service and
product design to provide best quality insurance products and
services to a broader customer base.
- On November 17, 2017, Fanhua won the Influential Insurance
Brands Award 2017 at the 12th Insurance Innovation Awards Ceremony,
one of the most authoritative and prestigious events in the
insurance industry. The panel of judges for the awards included
experts in insurance and brand culture as well as the financial
media.
Business Outlook
Fanhua expects its operating income to be no
less than RMB80.0 million for the first quarter of 2018. This
forecast reflects Fanhua’s current view, which is subject to
change.
Conference Call
The Company will host a conference call to
discuss its fourth quarter 2017 financial results as per the
following details.
| Time: 9:00
PM Eastern Daylight Time on March 12, 2018 |
| or 9:00 AM Beijing/Hong Kong Time on March 13, 2018 |
| The toll free dial-in
numbers: |
|
| United States |
1-855-500-8701 |
| United Kingdom |
0800-015-9724 |
| France |
0800-918-648 |
| Germany |
0800-184-4876 |
| Australia |
1-300-713-759 |
| Canada |
1-855-757-1565 |
| Taiwan |
0080-665-1951 |
| Hong Kong |
800-906-606 |
| The toll dial-in
numbers: |
|
| China (Mainland) |
400-120-0654 |
| Singapore & Other
Areas |
+852-3018-6776 |
Conference ID #: 6671677
Additionally, a live and archived web cast of this call will be
available at:http://ir.cninsure.net/events.cfm
About Fanhua Inc.
Fanhua Inc. is a leading independent
online-to-offline financial services provider. Through our online
platforms and offline sales and service network, we offer a wide
variety of financial products and services to individuals and
businesses, including property and casualty and life insurance
products. We also provide insurance claims adjusting services, such
as damage assessments, surveys, authentications and loss
estimations.
Our online platforms include (1) CNpad, a mobile
sales support application, (2) Baoxian.com, an online entry portal
for comparing and purchasing health, accident, travel and homeowner
insurance products; and (3) eHuzhu (www.ehuzhu.com), a non-profit
online mutual aid platform in China.
As of December 31, 2017, our distribution and
service network is consisted of 646 sales and service outlets
covering 29 provinces.
For more information about Fanhua Inc., please
visit http://ir.fanhuaholdings.com/.
Forward-looking Statements
This press release contains statements of a
forward-looking nature. These statements, including the statements
relating to the Company’s future financial and operating results,
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, 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 Fanhua and the
industry. Potential risks and uncertainties include, but are not
limited to, those relating to 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 the date hereof, and Fanhua 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 Fanhua 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 Fanhua is
included in Fanhua's filings with the U.S. Securities and Exchange
Commission, including its annual report on Form 20-F.
FANHUA INC.
Unaudited Condensed Consolidated Balance
Sheets (In thousands)
|
|
|
|
|
|
|
|
|
|
As of December
31, |
|
As of December
31, |
|
As of December
31, |
|
|
|
2016 |
|
2017 |
|
2017 |
|
|
|
RMB |
|
RMB |
|
US$ |
|
|
ASSETS: |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
| Cash
and cash equivalents |
236,952 |
|
363,746 |
|
55,907 |
|
|
Restricted cash |
31,996 |
|
75,287 |
|
11,571 |
|
| Short
term investments |
2,797,842 |
|
2,498,730 |
|
384,048 |
|
|
Accounts receivable, net |
501,804 |
|
515,194 |
|
79,184 |
|
|
Insurance premium receivables |
187 |
|
4,325 |
|
665 |
|
| Other
receivables |
49,094 |
|
631,381 |
|
97,041 |
|
|
Amounts due from related parties |
32,495 |
|
— |
|
— |
|
| Other
current assets |
31,230 |
|
43,864 |
|
6,742 |
|
|
Current assets held for sale6 |
12,964 |
|
— |
|
— |
|
|
Total current assets |
3,694,564 |
|
4,132,527 |
|
635,158 |
|
|
|
|
|
|
|
|
|
|
Non-current assets: |
|
|
|
|
|
|
|
Property, plant, and equipment, net |
31,338 |
|
26,075 |
|
4,008 |
|
|
Goodwill and intangible assets, net |
181,549 |
|
127,079 |
|
19,532 |
|
|
Deferred tax assets |
8,277 |
|
2,091 |
|
321 |
|
|
Investment in affiliates |
294,576 |
|
404,783 |
|
62,214 |
|
| Other
non-current assets |
28,188 |
|
45,187 |
|
6,945 |
|
|
Non-current assets held for sale |
76 |
|
— |
|
— |
|
|
Total non-current assets |
544,004 |
|
605,215 |
|
93,020 |
|
|
Total assets |
4,238,568 |
|
4,737,742 |
|
728,178 |
|
|
|
|
|
|
|
|
|
FANHUA INC.
Unaudited Condensed Consolidated
Balance
Sheets-(Continued)(In
thousands)
|
|
|
|
|
|
|
|
As of December 31, |
|
As of December 31, |
|
|
|
|
As of December 31, |
|
|
|
2016 |
|
2017 |
|
|
|
|
2017 |
|
|
|
RMB |
|
RMB |
|
|
|
|
US$ |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Accounts payable |
240,952 |
|
203,024 |
|
31,204 |
|
|
Insurance premium payables |
3,750 |
|
9,553 |
|
1,468 |
|
| Other
payables and accrued expenses |
273,458 |
|
241,894 |
|
37,178 |
|
|
Accrued payroll |
58,758 |
|
77,424 |
|
11,900 |
|
|
Income tax payable |
90,118 |
|
129,965 |
|
19,975 |
|
|
Current liabilities held for sale |
80,083 |
|
— |
|
— |
|
|
Total current liabilities |
747,119 |
|
661,860 |
|
101,725 |
|
|
|
|
|
|
|
|
Non-current liabilities: |
|
|
|
|
| Other
tax liabilities |
72,778 |
|
70,350 |
|
10,813 |
|
|
Deferred tax liabilities |
14,577 |
|
17,139 |
|
2,634 |
|
|
Non-current liabilities held for sale |
— |
|
— |
|
— |
|
|
Total non-current
liabilities |
87,355 |
|
87,489 |
|
13,447 |
|
|
Total liabilities |
834,474 |
|
749,349 |
|
115,172 |
|
|
Ordinary shares |
8,658 |
|
9,571 |
|
1,471 |
|
|
Additional paid-in capital |
2,301,655 |
|
2,429,559 |
|
373,416 |
|
|
Statutory reserves |
311,590 |
|
311,038 |
|
47,806 |
|
|
Retained earnings |
1,018,928 |
|
1,468,708 |
|
225,737 |
|
|
Accumulated other comprehensive loss |
(65,844 |
) |
(93,108 |
) |
(14,310 |
) |
|
Subscription receivables |
(288,135 |
) |
(248,717 |
) |
(38,227 |
) |
|
Total shareholders’ equity |
3,286,852 |
|
3,877,051 |
|
595, 893 |
|
|
Non-controlling interests |
117,242 |
|
111,342 |
|
17,113 |
|
|
Total equity |
3,404,094 |
|
3,988,393 |
|
613,006 |
|
|
Total liabilities and equity |
4,238,568 |
|
4,737,742 |
|
728,178 |
|
|
|
|
|
|
|
|
|
FANHUA
INC.Unaudited Condensed
Consolidated Statements of
Income and Comprehensive
Income (In thousands, except for shares and per share
data)
| |
|
|
|
|
For The Three Months Ended |
For The Twelve Months Ended |
| |
|
|
|
|
December 31, |
|
December 31, |
|
|
|
2016 |
|
2017 |
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
|
|
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
|
|
Net revenues: |
|
|
|
|
|
|
| Life
insurance Business |
362,347 |
|
490,319 |
|
75,361 |
|
990,541 |
|
2,424,444 |
|
372,630 |
|
|
P&C insurance Business |
857,357 |
|
101,858 |
|
15,655 |
|
2,755,930 |
|
1,355,773 |
|
208,378 |
|
|
Claims adjusting Business |
103,674 |
|
98,299 |
|
15,108 |
|
336,413 |
|
308,256 |
|
47,378 |
|
|
Total net revenues |
1,323,378 |
|
690,476 |
|
106,124 |
|
4,082,884 |
|
4,088,473 |
|
628,386 |
|
|
Operating costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
| Life
insurance Business |
(245,085 |
) |
(314,536 |
) |
(48,343 |
) |
(673,230 |
) |
(1,636,340 |
) |
(251,501 |
) |
|
P&C insurance Business |
(687,479 |
) |
(84,217 |
) |
(12,944 |
) |
(2,233,560 |
) |
(1,228,542 |
) |
(188,823 |
) |
|
Claims adjusting Business |
(57,273 |
) |
(57,643 |
) |
(8,860 |
) |
(199,810 |
) |
(194,525 |
) |
(29,898 |
) |
|
Total operating costs |
(989,837 |
) |
(456,396 |
) |
(70,147 |
) |
(3,106,600 |
) |
(3,059,407 |
) |
(470,222 |
) |
|
Selling expenses |
(168,132 |
) |
(61,539 |
) |
(9,458 |
) |
(502,803 |
) |
(221,785 |
) |
(34,088 |
) |
|
General and administrative expenses |
(144,065 |
) |
(110,398 |
) |
(16,968 |
) |
(481,947 |
) |
(534,145 |
) |
(82,096 |
) |
|
Total operating costs and expenses |
(1,302,034 |
) |
(628,333 |
) |
(96,573 |
) |
(4,091,350 |
) |
(3,815,337 |
) |
(586,406 |
) |
|
Income (loss) from
operations |
21,344 |
|
62,143 |
|
9,551 |
|
(8,466 |
) |
273,136 |
|
41,980 |
|
|
Other income, net: |
|
|
|
|
|
|
|
Investment income |
53,837 |
|
39,454 |
|
6,064 |
|
115,275 |
|
191,784 |
|
29,477 |
|
|
Interest income |
347 |
|
12,401 |
|
1,906 |
|
6,901 |
|
25,891 |
|
3,980 |
|
|
Others, net |
(407 |
) |
1,863 |
|
286 |
|
10,341 |
|
14,284 |
|
2,195 |
|
|
Income from continuing operations before income taxes and
income of affiliates and discontinued operations |
75,121 |
|
115,861 |
|
17,807 |
|
124,051 |
|
505,095 |
|
77,632 |
|
|
Income tax expense |
(18,832 |
) |
(38,126 |
) |
(5,860 |
) |
(27,249 |
) |
(167,803 |
) |
(25,791 |
) |
| Share
of income of affiliates |
13,895 |
|
55,192 |
|
8,483 |
|
48,293 |
|
108,944 |
|
16,744 |
|
| Net
income from continuing operations |
70,184 |
|
132,927 |
|
20,430 |
|
145,095 |
|
446,236 |
|
68,585 |
|
| Net
income (loss) from discontinued operations, net of tax |
11,684 |
|
(1,175 |
) |
(180 |
) |
22,543 |
|
5,480 |
|
842 |
|
|
Net income |
81,868 |
|
131,752 |
|
20,250 |
|
167,638 |
|
451,716 |
|
69,427 |
|
| less:
net income attributable to noncontrolling interests |
7,274 |
|
4,878 |
|
750 |
|
10,591 |
|
2,488 |
|
382 |
|
|
Net income attributable to the
Company’s shareholders |
74,594 |
|
126,874 |
|
19,500 |
|
157,047 |
|
449,228 |
|
69,045 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FANHUA
INC.Unaudited
Condensed Consolidated Statements
of Income and
Comprehensive
Income-(Continued)(In thousands, except for shares
and per share data)
| |
|
|
| |
For The Three Months Ended |
|
For The Twelve
Months Ended |
|
| |
December 31, |
|
December 31, |
|
| |
2016 |
|
2017 |
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
|
|
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
| Net income per
share: Basic: Net income from continuing
operations |
0.05 |
|
0.10 |
|
0.02 |
|
0.12 |
|
0.36 |
|
0.06 |
|
| Net income from
discontinued operations |
0.01 |
|
0.00 |
|
0.00 |
|
0.02 |
|
0.00 |
|
0.00 |
|
| Net income |
0.06 |
|
0.10 |
|
0.02 |
|
0.14 |
|
0.36 |
|
0.06 |
|
|
Diluted: |
|
|
|
|
|
|
| Net income from
continuing operations |
0.05 |
|
0.10 |
|
0.02 |
|
0.11 |
|
0.36 |
|
0.06 |
|
| Net income from
discontinued operations |
0.01 |
|
0.00 |
|
0.00 |
|
0.02 |
|
0.00 |
|
0.00 |
|
| Net income |
0.06 |
|
0.10 |
|
0.02 |
|
0.13 |
|
0.36 |
|
0.06 |
|
|
|
|
|
|
|
|
|
| Net income per
ADS: Basic: |
|
|
|
|
|
|
| Net income from
continuing operations |
1.08 |
|
2.00 |
|
0.31 |
|
2.32 |
|
7.20 |
|
1.11 |
|
| Net income (loss) from
discontinued operations |
0.20 |
|
(0.02 |
) |
(0.01 |
) |
0.39 |
|
0.09 |
|
0.02 |
|
| Net income |
1.28 |
|
1.98 |
|
0.30 |
|
2.71 |
|
7.29 |
|
1.13 |
|
|
Diluted: |
|
|
|
|
|
|
| Net income from
continuing operations |
1.04 |
|
2.00 |
|
0.31 |
|
2.23 |
|
7.20 |
|
1.11 |
|
| Net income (loss) from
discontinued operations |
0.19 |
|
(0.02 |
) |
(0.01 |
) |
0.37 |
|
0.09 |
|
0.02 |
|
| Net income |
1.23 |
|
1.98 |
|
0.30 |
|
2.60 |
|
7.29 |
|
1.13 |
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
| Shares used in
calculating net income per share: Basic |
1,164,454,046 |
|
1,280,599,856 |
|
1,280,599,856 |
|
1,160,592,325 |
|
1,231,698,725 |
|
1,231,698,725 |
|
| Diluted |
1,213,598,234 |
|
1,283,796,409 |
|
1,283,796,409 |
|
1,208,821,796 |
|
1,261,223,049 |
|
1,261,223,049 |
|
|
Net income |
81,868 |
|
131,752 |
|
20,250 |
|
167,638 |
|
451,716 |
|
69,427 |
|
| Other comprehensive
income (loss), net of tax: Foreign currency translation
adjustments |
(7,151 |
) |
(9,755 |
) |
(1,499 |
) |
2,177 |
|
21,101 |
|
3,204 |
|
| Fair value changes |
632 |
|
— |
|
— |
|
632 |
|
(632 |
) |
(97 |
) |
| Share of other
comprehensive gain (loss) of affiliates |
(955 |
) |
920 |
|
141 |
|
(37,911 |
) |
1,263 |
|
194 |
|
| Comprehensive
income |
74,394 |
|
122,917 |
|
18,892 |
|
132,536 |
|
473,448 |
|
72,728 |
|
| Less: Comprehensive
income (loss) attributable to the noncontrolling interests |
7,274 |
|
4,878 |
|
750 |
|
10,591 |
|
2,488 |
|
382 |
|
| Comprehensive
income attributable to the
Company’s shareholders |
67,120 |
|
118,039 |
|
18,142 |
|
121,945 |
|
470,960 |
|
75,346 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
FANHUA
INC.Unaudited Condensed
Consolidated Statements of Cash Flow(In
thousands)
| |
|
|
|
|
For the Three Months Ended |
|
|
For the Twelve
Months Ended |
|
|
|
December 31, |
|
|
December 31, |
|
|
|
2016 |
|
2017 |
|
2017 |
|
|
2016 |
|
2017 |
|
2017 |
|
|
|
RMB |
|
RMB |
|
US$ |
|
|
RMB |
|
RMB |
|
US$ |
|
|
|
|
|
|
|
|
|
| Net cash generated from
operating activities |
113,516 |
|
59,853 |
|
9,199 |
|
|
87,846 |
|
152,127 |
|
23,381 |
|
| Net cash (used in)
generated from investing activities |
(99,090 |
) |
43,668 |
|
6,712 |
|
|
(732,606 |
) |
(23,723 |
) |
(3,646 |
) |
| Net cash generated from
(used in) financing activities |
399 |
|
(150,452 |
) |
(23,124 |
) |
|
(216,575 |
) |
47,558 |
|
7,310 |
|
| Net increase (decrease)
in cash and cash equivalents, and restricted cash |
14,825 |
|
(46,931 |
) |
(7,213 |
) |
|
(861,335 |
) |
175,962 |
|
27,045 |
|
|
Cash, cash
equivalents and restricted cash
at beginning of period |
258,233 |
|
489,895 |
|
75,295 |
|
|
1,132,851 |
|
273,9797 |
|
42,110 |
|
| Effect of exchange rate
changes on cash and cash equivalents |
921 |
|
(3,931 |
) |
(604 |
) |
|
2,463 |
|
(10,908 |
) |
(1,677 |
) |
|
Cash, cash
equivalents and restricted cash
at end of period |
273,979 |
|
439,033 |
|
67,478 |
|
|
273,979 |
|
439,033 |
|
67,478 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
For more information, please
contact:Oasis QiuInvestor Relations ManagerTel: +86 (20)
8388-3191Email: qiusr@fanhuaholdings.comSource:
Fanhua Inc.
_________________________________
1 This announcement contains currency
conversions 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 RMB6.5063 to US$1.00, the effective noon
buying rate as of December 31, 2017 in The City of New York for
cable transfers of RMB as set forth in the H.10 weekly statistical
release of the Federal Reserve Board.
2 Following the disposal of Fanhua Bocheng
Insurance Brokerage Co., Ltd.. (“Bocheng”), a company primarily
engaged in providing insurance brokerage business in November 2017,
the Company is required to present its financial results on a
continuing and discontinued basis. Profits and losses related to
Bocheng are presented as discontinued operations while profits and
losses for the remaining business are presented as continuing
operations.
3 Active users of CNpad App included users who made at
least one purchase of auto insurance policy through CNpad App
(including both its mobile application and WeChat public
account) during the specific period.
4 Active users are defined as users who made at least one
purchase of life insurance policy through Lan Zhanggui in the
fourth quarter of 2017 or CNpad Life Insurance App prior to the
fourth quarter of 2016 during the specified period.
5 Active customer accounts are defined as
customer accounts that made at least one purchase directly through
www.baoxian.com, its mobile application, or WeChat public
account during the specified period.
6 Current assets held for sale includes cash, cash equivalents
and restricted cash of RMB 5,032 and nil in thousands as of
December 31, 2016 and 2017, respectively.
7 Amount includes cash, cash equivalents and restricted cash
RMB5,032 in thousands of brokerage segment as of December 31,
2016.
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