Yiren Digital Ltd. (NYSE: YRD) (“Yiren Digital” or the “Company”),
a leading fintech company in China, today announced its unaudited
financial results for the third quarter ended September 30, 2019.
Third Quarter 2019 Operational HighlightsWealth
Management—Yiren Wealth
- Cumulative number of investors served reached 2,200, 223,
representing an increase of 0.7% from 2,185,513 in the second
quarter of 2019 and compared to 2,042,607 in the third quarter of
2018.
- Number of active investors in the third quarter of 2019 was
586,333, representing a decrease of 13% from 671,957 in the
second quarter of 2019.
- Total assets under management (“AUM”) for Yiren Wealth’s P2P
products was RMB 40,191.7 million (US$ 5,623.0 million) as of
September 30, 2019, representing a decrease of 7% from RMB
43,249.9 million as of June 30, 2019. Average AUM per
investor reached RMB 152,289 (US$ 21,306) as of September 30, 2019,
representing an increase of 1% from RMB 151,378 as of June 30,
2019.
- Total assets under administration (“AUA”) of non-P2P products
amounted to RMB 767.2 million (US$ 107.3 million) in the third
quarter of 2019, representing an increase of 169% from RMB 284.8
million in the second quarter of 2019. Total AUM of non-P2P
products was RMB 645.9 million (US$90.4 million) as of September
30, 2019, representing an increase of 80% from RMB 358.6 million as
of June 30, 2019. Non-P2P products include bank’s wealth management
products, mutual funds and insurance.
- Number of non-P2P investors was 19,496 as of September 30,
2019, representing an increase of 14% from 17,133 as of June
30, 2019.
Consumer Credit—Yiren Credit
- Total loan originations in the third quarter of 2019 reached
RMB 10.5 billion (US$1.5 billion), representing an increase of 9%
from RMB 9.7 billion in the second quarter of 2019 and compared to
RMB 11.8 billion in the third quarter of 2018.
- Cumulative number of borrowers served reached 4,593,590,
representing an increase of 2% from 4,491,761 in the second quarter
of 2019 and compared to 4,161,600 in the third quarter of
2018.
- Number of borrowers in the third quarter of 2019 was 150,280,
representing an increase of 11% from 135,246 in the second quarter
of 2019 and compared to 174,630 in the third quarter of
2018.
- The percentage of loan volume generated by repeat borrowers was
34.0 % in the third quarter of 2019.
- 45.7% of loan originations were generated online in the third
quarter of 2019.
- Total outstanding principal balance of performing loans reached
RMB 54,553.7 million (US$7,632.3 million) as of September 30, 2019,
representing a decrease of 6% from RMB 58,071.3 million as of June
30, 2019.
“We are pleased to deliver solid performance this quarter amidst
a tightening regulatory environment, as highlighted by a 48%
increase in net profit to RMB 228.0 million from RMB 154.5 million
in the previous quarter, a sign of improvement in our business
fundamentals and operating efficiency resulted from the synergies
of our business re-alignments,” said Mr. Ning Tang, Chairman and
Chief Executive Officer of Yiren Digital. “Looking forward, we will
stay focused on driving our credit business and enhancing
shareholder value by expanding our product portfolio, achieving
further diversification in funding sources and seeking new
marketing channels. On wealth management, we rolled out online
financial advisory services to selected clients in the third
quarter of 2019 and we will continue to focus on building up our
investor’s investment portfolio in non-p2p wealth management
products.”
“We resumed loan origination growth this quarter with loan
volume increasing to RMB 10.5 billion, representing a 9% growth
quarter over quarter,” said Mr. Dennis Cong, Senior VP of Yiren
Digital. “Our balance sheet remained strong with
approximately RMB 3.0 billion of cash and short-term
liquidity. In particular, we also generated a positive net cash
flow from operating activities of RMB 808.1 million this quarter,
indicating a resilient and profitable business model. On
institutional funding, we want to highlight that we have increased
the line of facility from our institutional partners to RMB 35.0
billion in the third quarter of 2019 from RMB 30.0 billion in the
second quarter of 2019.”
“On credit performance and risk management, we are seeing
promising improvements in early delinquencies this quarter
indicating an enhanced asset quality” said Mr. Huan Chen, Chief
Risk Officer of Yiren Digital. “Despite industry uncertainties our
early conservative credit policy adjustment has shown improving
trends and we are working with regulators in connecting our data to
PBOC.”
Third Quarter 2019 Financial Results
Total amount of loans facilitated in the third
quarter of 2019 was RMB 10,496.3 million (US$1,468.5 million),
compared to RMB 11,781.9 million in the same period last year. As
of September 30, 2019, the total outstanding principal amount of
the performing loans was RMB 54.6 billion (US$7.6 billion),
decreased by 6% from RMB 58.1 billion as of June 30, 2019.
Total net revenue in the third quarter of 2019
was RMB 2,056.1 million (US$287.7 million), compared to RMB 2,187.6
million in the same period last year. Revenue from Yiren Credit
reached RMB 1,515.5 million (US$ 212.1 million), representing a
decrease of 8% from RMB 1,643.8 million in the third quarter of
2018. Revenue from Yiren Wealth reached RMB 540.6 million (US$75.6
million), representing a decrease of 1% from RMB 543.8 million in
the third quarter of 2018.
Sales and marketing expenses in the third
quarter of 2019 were RMB 1,160.4 million (US$162.3 million),
compared to RMB 1,449.6 million in the same period last year. Sales
and marketing expenses in the third quarter of 2019 accounted for
11.1% of the total amount of loans facilitated, as compared to
12.3% in the same period last year mainly due to an increase in
customer acquisition and as well as
operating efficiencies.
Origination and servicing costs in the third
quarter of 2019 were RMB 156.1 million (US$21.8 million), compared
to RMB 262.1 million in the same period last year. Origination and
servicing costs in the third quarter of 2019 accounted for 1.5% of
the total amount of loans facilitated, compared to 2.2% in the same
period last year.
General and administrative expenses in the
third quarter of 2019 were RMB 168.1 million (US$23.5 million),
compared to RMB 367.9 million in the same period last year. General
and administrative expenses in the third quarter of 2019 accounted
for 8.2% of the total net revenue, compared to 16.8% in the same
period last year.
Allowance for contract assets in the third
quarter of 2019 were RMB 344.7 million (US$48.2 million), compared
to RMB 272.9 million in the same period last year. The increase was
mainly attributable to changes in future collectability
estimates.
Income tax expense in the third quarter of 2019
was RMB 19.9 million (US$2.8 million).
Net income in the third quarter of 2019 was RMB
228.0 million (US$31.9 million), compared to a net loss of RMB
135.8 million in the same period last year.
Adjusted EBITDA (non-GAAP) in the third quarter
of 2019 was RMB 274.2 million (US$38.4 million), compared to an
adjusted EBITDA loss of RMB 12.3 million in the same period last
year. Adjusted EBITDA margin1 (non-GAAP) in the third quarter of
2019 was 13.3%, compared to -0.6% in the same period last year.
Basic income per ADS in the third quarter of
2019 was RMB 2.46 (US$0.34), compared to a basic loss per ADS
of RMB 1.47 in the same period last year.
Diluted income per ADS in the third quarter of
2019 was RMB 2.45 (US$0.34), compared to a diluted loss per ADS of
RMB 1.47 in the same period last year.
Net cash generated from operating activities in
the third quarter of 2019 was RMB 808.1 million (US$113.1 million),
compared to RMB 216.9 million in the same period last year.
Net cash used in investing activities in the
third quarter of 2019 was RMB 924.1 million (US$129.3 million)
which includes a payment of RMB 846.0 million made to CreditEase as
part of the contingent consideration for the business
realignment.
As of September 30, 2019, cash and cash equivalents was RMB
2,633.0 million (US$368.4 million), compared to RMB 2,706.5 million
as of June 30, 2019. As of September 30, 2019, the balance of
held-to-maturity investments was RMB 8.1 million (US$1.1 million),
compared to RMB 9.5 million as of June 30, 2019. As of September
30, 2019, the balance of available-for-sale investments was RMB
426.3 million (US$59.6 million), compared to RMB 387.5 million as
of June 30, 2019.
Delinquency rates. As of September 30, 2019,
the delinquency rates for loans that are past due for 15-29 days,
30-59 days and 60-89 days were 1.0%, 1.8%, and 1.6%, respectively
compared to 1.1%, 1.8%, and 1.9%,as of June 30, 2019.
Cumulative M3+ net charge-off
rates. As of September 30, 2019, the cumulative M3+ net
charge-off rate for loans originated in 2016 was 9.4%, compared to
9.2% as of June 30, 2019. As of September 30, 2019, the cumulative
M3+ net charge-off rate for loans originated in 2017 was 15.3%,
compared to 14.0% as of June 30, 2019. As of September 30, 2019,
the cumulative M3+ net charge-off rate for loans originated in 2018
was 11.6%, compared to 8.7% as of June 30, 2019.
Non-GAAP Financial MeasuresIn evaluating the
business, the Company considers and uses several non-GAAP financial
measures, such as adjusted EBITDA and adjusted EBITDA margin as
supplemental measures to review and assess operating performance.
We believe these non-GAAP measures provide useful information about
our core operating results, enhance the overall understanding of
our past performance and prospects and allow for greater visibility
with respect to key metrics used by our management in our financial
and operational decision-making. 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 accounting principles generally
accepted in the United States of America (“U.S. GAAP”). The
non-GAAP financial measures have limitations as analytical tools.
Other companies, including peer companies in the industry, may
calculate these non-GAAP measures differently, which may reduce
their usefulness as a comparative measure. The Company compensates
for these limitations by reconciling the non-GAAP financial
measures to the nearest U.S. GAAP performance measure, all of which
should be considered when evaluating our performance. See
“Operating Highlights and Reconciliation of GAAP to Non-GAAP
measures” at the end of this press release.
Currency ConversionThis announcement contains
currency conversions of certain RMB amounts into US$ at specified
rates solely for the convenience of the reader. Unless otherwise
noted, all translations from RMB to US$ are made at a rate of RMB
7.1477 to US$1.00, the effective noon buying rate on September 30,
2019, as set forth in the H.10 statistical release of the Federal
Reserve Board.
Conference CallYiren Digital’s management will
host an earnings conference call at 7:00 p.m. U.S. Eastern
Time on November 14, 2019, (or 8:00
a.m. Beijing/Hong Kong Time on November 15, 2019).
Dial-in details for the earnings conference call are as
follows:
International: |
+65 6713-5091 |
U.S. Toll Free: |
+1 866-519-4004 |
Hong Kong Toll Free: |
800-906-601 |
China Toll Free: |
400-620-8038 |
Conference ID: |
9299687 |
A replay of the conference call may be accessed by phone at the
following numbers until November 22, 2019:
International: |
+61 2-8199-0299 |
U.S. Toll Free: |
+1 646-254-3697 |
Replay Access Code: |
9299687 |
Additionally, a live and archived webcast of the conference call
will be available at ir.yirendai.com.
Safe Harbor StatementThis press release
contains forward-looking statements. These statements constitute
“forward-looking” statements within the meaning of Section 21E of
the Securities Exchange Act of 1934, as amended, and as defined in
the U.S. Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
“will,” “expects,” “anticipates,” “future,” “intends,” “plans,”
“believes,” “estimates,” “target,” “confident” and similar
statements. Such statements are based upon management’s current
expectations and current market and operating conditions and relate
to events that involve known or unknown risks, uncertainties and
other factors, all of which are difficult to predict and many of
which are beyond Yiren Digital’s control. Forward-looking
statements involve risks, uncertainties, and other factors that
could cause actual results to differ materially from those
contained in any such statements. Potential risks and uncertainties
include, but are not limited to, uncertainties as to Yiren
Digital’s ability to attract and retain borrowers and investors on
its marketplace, its ability to introduce new loan products and
platform enhancements, its ability to compete effectively, PRC
regulations and policies relating to the peer-to-peer lending
service industry in China, general economic conditions in China,
and Yiren Digital’s ability to meet the standards necessary to
maintain listing of its ADSs on the NYSE or other stock exchange,
including its ability to cure any non-compliance with the NYSE’s
continued listing criteria. Further information regarding these and
other risks, uncertainties or factors is included in Yiren
Digital’s filings with the U.S. Securities and Exchange Commission.
All information provided in this press release is as of the date of
this press release, and Yiren Digital does not undertake any
obligation to update any forward-looking statement as a result of
new information, future events or otherwise, except as required
under applicable law.
About Yiren Digital Yiren Digital Ltd. (NYSE:
YRD) is a leading fintech company in China connecting investors and
individual borrowers. The Company provides an effective solution to
address largely underserved investor and individual borrower demand
in China through online and offline channels to efficiently match
borrowers with investors and execute loan transactions. Yiren
Digital deploys a proprietary risk management system, which enables
the Company to effectively assess the creditworthiness of
borrowers, appropriately price the risks associated with borrowers,
and offer quality loan investment opportunities to investors. Yiren
Digital’s marketplace provides borrowers with quick and convenient
access to consumer credit at competitive prices and investors with
easy and quick access to an alternative asset class with attractive
returns. For more information, please visit ir.Yirendai.com.
For investor and media inquiries, please
contact: Yiren DigitalInvestor
RelationsEmail: ir@Yirendai.com
____________________
1 Adjusted EBITDA margin is a non-GAAP financial
measure calculated as adjusted EBITDA divided by total net
revenue.
|
|
Unaudited Condensed Consolidated Statements of
Operations |
(in thousands, except for share, per share and per
ADS data, and percentages) |
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
September 30, 2018 |
|
June 30, 2019 |
|
September 30, 2019 |
|
September 30, 2019 |
|
|
September 30, 2018 |
|
September 30, 2019 |
|
September 30, 2019 |
|
RMB (Recast*) |
|
RMB |
|
RMB |
|
USD |
|
|
RMB (Recast*) |
|
RMB |
|
USD |
Net revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan facilitation services |
1,251,834 |
|
|
1,237,718 |
|
|
1,286,923 |
|
|
180,047 |
|
|
|
6,303,575 |
|
|
3,579,687 |
|
|
500,817 |
|
Post-origination services |
269,874 |
|
|
241,321 |
|
|
103,073 |
|
|
14,420 |
|
|
|
854,749 |
|
|
640,673 |
|
|
89,633 |
|
Account management services |
508,625 |
|
|
549,024 |
|
|
489,673 |
|
|
68,508 |
|
|
|
1,302,170 |
|
|
1,527,037 |
|
|
213,640 |
|
Others |
157,301 |
|
|
188,577 |
|
|
176,439 |
|
|
24,685 |
|
|
|
479,095 |
|
|
505,759 |
|
|
70,758 |
|
Total net revenue |
2,187,634 |
|
|
2,216,640 |
|
|
2,056,108 |
|
|
287,660 |
|
|
|
8,939,589 |
|
|
6,253,156 |
|
|
874,848 |
|
Operating costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing |
1,449,556 |
|
|
1,208,647 |
|
|
1,160,365 |
|
|
162,341 |
|
|
|
5,421,523 |
|
|
3,496,957 |
|
|
489,241 |
|
Origination and servicing |
262,050 |
|
|
162,945 |
|
|
156,073 |
|
|
21,835 |
|
|
|
834,187 |
|
|
491,141 |
|
|
68,713 |
|
General and administrative |
367,894 |
|
|
175,534 |
|
|
168,092 |
|
|
23,517 |
|
|
|
1,394,173 |
|
|
601,333 |
|
|
84,130 |
|
Allowance for contract assets and receivables |
272,889 |
|
|
500,861 |
|
|
344,742 |
|
|
48,231 |
|
|
|
783,596 |
|
|
1,036,707 |
|
|
145,041 |
|
Total operating costs and expenses |
2,352,389 |
|
|
2,047,987 |
|
|
1,829,272 |
|
|
255,924 |
|
|
|
8,433,479 |
|
|
5,626,138 |
|
|
787,125 |
|
Other income/(expenses): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income, net |
8,440 |
|
|
25,213 |
|
|
13,825 |
|
|
1,934 |
|
|
|
58,088 |
|
|
62,913 |
|
|
8,802 |
|
Fair value adjustments related to Consolidated ABFE |
55,658 |
|
|
5,787 |
|
|
(1,323 |
) |
|
(185 |
) |
|
|
203,278 |
|
|
39,462 |
|
|
5,521 |
|
Others, net |
1,089 |
|
|
17,480 |
|
|
7,112 |
|
|
995 |
|
|
|
(5,834 |
) |
|
184,815 |
|
|
25,857 |
|
Total other income |
65,187 |
|
|
48,480 |
|
|
19,614 |
|
|
2,744 |
|
|
|
255,532 |
|
|
287,190 |
|
|
40,180 |
|
Income before provision for income taxes |
(99,568 |
) |
|
217,133 |
|
|
246,450 |
|
|
34,480 |
|
|
|
761,642 |
|
|
914,208 |
|
|
127,903 |
|
Share of results of equity investees |
(917 |
) |
|
(816 |
) |
|
1,505 |
|
|
211 |
|
|
|
(5,946 |
) |
|
(4,268 |
) |
|
(597 |
) |
Income tax expense |
35,307 |
|
|
61,856 |
|
|
19,924 |
|
|
2,788 |
|
|
|
161,802 |
|
|
158,314 |
|
|
22,149 |
|
Net income |
(135,792 |
) |
|
154,461 |
|
|
228,031 |
|
|
31,903 |
|
|
|
593,894 |
|
|
751,626 |
|
|
105,157 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of ordinary shares outstanding, basic |
185,024,291 |
|
|
184,608,337 |
|
|
185,548,214 |
|
|
185,548,214 |
|
|
|
183,933,356 |
|
|
185,095,873 |
|
|
185,095,873 |
|
Basic income per share |
(0.7339 |
) |
|
0.8367 |
|
|
1.2290 |
|
|
0.1719 |
|
|
|
3.2289 |
|
|
4.0607 |
|
|
0.5681 |
|
Basic income per ADS |
(1.4678 |
) |
|
1.6734 |
|
|
2.4580 |
|
|
0.3438 |
|
|
|
6.4578 |
|
|
8.1214 |
|
|
1.1362 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of ordinary shares outstanding,
diluted |
185,024,291 |
|
|
186,667,233 |
|
|
186,351,678 |
|
|
186,351,678 |
|
|
|
186,088,414 |
|
|
186,433,058 |
|
|
186,433,058 |
|
Diluted income per share |
(0.7339 |
) |
|
0.8275 |
|
|
1.2237 |
|
|
0.1712 |
|
|
|
3.1915 |
|
|
4.0316 |
|
|
0.5640 |
|
Diluted income per ADS |
(1.4678 |
) |
|
1.6550 |
|
|
2.4474 |
|
|
0.3424 |
|
|
|
6.3830 |
|
|
8.0632 |
|
|
1.1280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited Condensed Consolidated Cash Flow Data
(Recast**) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash generated from/ (used in) operating activities |
216,874 |
|
|
36,352 |
|
|
808,148 |
|
|
113,064 |
|
|
|
(2,505,496 |
) |
|
186,065 |
|
|
26,032 |
|
Net cash provided by/ (used in) investing activities |
2,220,043 |
|
|
240,896 |
|
|
(924,146 |
) |
|
(129,293 |
) |
|
|
2,426,607 |
|
|
(933,181 |
) |
|
(130,557 |
) |
Net cash (used in)/ provided by financing activities |
(2,307,038 |
) |
|
(73,385 |
) |
|
6,886 |
|
|
963 |
|
|
|
(2,272,048 |
) |
|
426,890 |
|
|
59,724 |
|
Effect of foreign exchange rate changes |
(119,172 |
) |
|
1,532 |
|
|
3,193 |
|
|
448 |
|
|
|
(122,031 |
) |
|
2,529 |
|
|
354 |
|
Net increase/(decrease) in cash, cash equivalents and restricted
cash |
10,707 |
|
|
205,395 |
|
|
(105,919 |
) |
|
(14,818 |
) |
|
|
(2,472,968 |
) |
|
(317,697 |
) |
|
(44,447 |
) |
Cash, cash equivalents and restricted cash, beginning of
period |
1,996,647 |
|
|
2,617,311 |
|
|
2,822,706 |
|
|
394,911 |
|
|
|
4,480,322 |
|
|
3,034,484 |
|
|
424,540 |
|
Cash, cash equivalents and restricted cash, end of period |
2,007,354 |
|
|
2,822,706 |
|
|
2,716,787 |
|
|
380,093 |
|
|
|
2,007,354 |
|
|
2,716,787 |
|
- |
380,093 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited Condensed Consolidated Balance
Sheets |
(in thousands) |
|
|
|
As of |
|
|
December 31, 2018 |
|
June 30, 2019 |
|
September 30, 2019 |
|
September 30, 2019 |
|
|
RMB (Recast*) |
|
RMB |
|
RMB |
|
USD |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
2,606,939 |
|
|
2,706,530 |
|
|
2,632,952 |
|
|
368,364 |
|
Restricted cash |
|
427,546 |
|
|
116,176 |
|
|
83,835 |
|
|
11,729 |
|
Accounts receivable |
|
40,326 |
|
|
27,212 |
|
|
67,231 |
|
|
9,406 |
|
Contract assets, net |
|
3,909,263 |
|
|
2,958,476 |
|
|
2,598,202 |
|
|
363,502 |
|
Contract cost |
|
145,460 |
|
|
141,480 |
|
|
143,066 |
|
|
20,016 |
|
Prepaid expenses and other assets |
|
2,552,319 |
|
|
1,142,757 |
|
|
1,280,784 |
|
|
179,188 |
|
Loans at fair value |
|
1,375,221 |
|
|
677,354 |
|
|
552,648 |
|
|
77,318 |
|
Financing receivables |
|
- |
|
|
25,175 |
|
|
24,630 |
|
|
3,446 |
|
Amounts due from related parties |
|
1,361,805 |
|
|
1,791,515 |
|
|
1,678,499 |
|
|
234,831 |
|
Held-to-maturity investments |
|
329,597 |
|
|
9,542 |
|
|
8,051 |
|
|
1,126 |
|
Available-for-sale investments |
|
835,565 |
|
|
387,519 |
|
|
426,321 |
|
|
59,644 |
|
Long term investments |
|
217,636 |
|
|
143,047 |
|
|
144,552 |
|
|
20,224 |
|
Property, equipment and software, net |
|
266,002 |
|
|
230,078 |
|
|
213,962 |
|
|
29,934 |
|
Deferred tax assets |
|
184,136 |
|
|
149,269 |
|
|
150,363 |
|
|
21,037 |
|
Right-of-use assets |
|
- |
|
|
398,154 |
|
|
383,545 |
|
|
53,660 |
|
Total assets |
|
14,251,815 |
|
|
10,904,284 |
|
|
10,388,641 |
|
|
1,453,425 |
|
Accounts payable |
|
307,046 |
|
|
54,158 |
|
|
62,313 |
|
|
8,718 |
|
Amounts due to related parties |
|
8,276,459 |
|
|
169,189 |
|
|
289,820 |
|
|
40,547 |
|
Liabilities from quality assurance program and guarantee |
|
9,950 |
|
|
6,539 |
|
|
5,644 |
|
|
790 |
|
Deferred revenue |
|
569,469 |
|
|
390,621 |
|
|
381,899 |
|
|
53,430 |
|
Payable to investors at fair value |
|
626,207 |
|
|
- |
|
|
- |
|
|
- |
|
Accrued expenses and other liabilities |
|
2,193,576 |
|
|
2,265,288 |
|
|
2,351,078 |
|
|
328,928 |
|
Refund liability |
|
2,145,748 |
|
|
2,039,998 |
|
|
2,002,785 |
|
|
280,200 |
|
Deferred tax liabilities |
|
486,773 |
|
|
329,347 |
|
|
267,647 |
|
|
37,445 |
|
Lease liabilities |
|
- |
|
|
341,364 |
|
|
322,832 |
|
|
45,166 |
|
Contingent consideration |
|
- |
|
|
2,626,734 |
|
|
1,780,734 |
|
|
249,134 |
|
Total liabilities |
|
14,615,228 |
|
|
8,223,238 |
|
|
7,464,752 |
|
|
1,044,358 |
|
Ordinary shares |
|
77 |
|
|
77 |
|
|
121 |
|
|
17 |
|
Shares to be issued |
|
- |
|
|
2,754,444 |
|
|
- |
|
|
- |
|
Additional paid-in capital |
|
1,293,968 |
|
|
1,106,153 |
|
|
3,872,219 |
|
|
541,743 |
|
Treasury stock |
|
(254 |
) |
|
(37,097 |
) |
|
(37,097 |
) |
|
(5,190 |
) |
Accumulated other comprehensive income |
|
16,390 |
|
|
18,367 |
|
|
25,225 |
|
|
3,529 |
|
Accumulated deficit |
|
(1,673,594 |
) |
|
(1,160,898 |
) |
|
(936,579 |
) |
|
(131,032 |
) |
Total (deficit)/ equity |
|
(363,413 |
) |
|
2,681,046 |
|
|
2,923,889 |
|
- |
409,067 |
|
Total liabilities and equity |
|
14,251,815 |
|
|
10,904,284 |
|
|
10,388,641 |
|
- |
1,453,425 |
|
|
|
|
|
|
|
|
|
|
Operating Highlights and Reconciliation of GAAP to Non-GAAP
Measures |
(in thousands, except for number of borrowers, number of
investors and percentages) |
|
|
For the Three Months Ended |
|
|
For the Nine Months Ended |
|
September 30, 2018 |
|
June 30, 2019 |
|
September 30, 2019 |
|
September 30, 2019 |
|
|
September 30, 2018 |
|
September 30, 2019 |
|
September 30, 2019 |
|
RMB (Recast*) |
|
RMB |
|
RMB |
|
USD |
|
|
RMB (Recast*) |
|
RMB |
|
USD |
Operating Highlights |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount of investment |
18,235,782 |
|
|
11,939,582 |
|
|
9,037,670 |
|
|
1,264,417 |
|
|
|
53,890,936 |
|
|
32,412,841 |
|
|
4,534,723 |
|
AUM of investment |
71,950,315 |
|
|
64,476,635 |
|
|
59,792,510 |
|
|
8,365,280 |
|
|
|
71,950,315 |
|
|
59,792,510 |
|
|
8,365,280 |
|
Number of investors |
257,159 |
|
|
157,973 |
|
|
113,955 |
|
|
113,955 |
|
|
|
647,024 |
|
|
319,538 |
|
|
319,538 |
|
Amount of loans facilitated |
11,781,947 |
|
|
9,673,818 |
|
|
10,496,261 |
|
|
1,468,481 |
|
|
|
49,733,287 |
|
|
31,105,001 |
|
|
4,351,750 |
|
Number of borrowers |
174,630 |
|
|
135,246 |
|
|
150,280 |
|
|
150,280 |
|
|
|
726,917 |
|
|
423,414 |
|
|
423,414 |
|
Remaining principal of performing loans |
71,625,593 |
|
|
58,071,303 |
|
|
54,553,702 |
|
|
7,632,343 |
|
|
|
71,625,593 |
|
|
54,553,702 |
|
|
7,632,343 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Information |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wealth management: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
543,857 |
|
|
592,378 |
|
|
540,554 |
|
|
75,626 |
|
|
|
1,498,458 |
|
|
1,654,366 |
|
|
231,454 |
|
Sales and marketing expenses |
220,561 |
|
|
213,168 |
|
|
219,390 |
|
|
30,694 |
|
|
|
1,169,242 |
|
|
576,462 |
|
|
80,650 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer credit: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
1,643,777 |
|
|
1,624,262 |
|
|
1,515,554 |
|
|
212,034 |
|
|
|
7,441,131 |
|
|
4,598,790 |
|
|
643,394 |
|
Sales and marketing expenses |
1,228,995 |
|
|
995,479 |
|
|
940,975 |
|
|
131,647 |
|
|
|
4,252,281 |
|
|
2,920,495 |
|
|
408,591 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
(135,792 |
) |
|
154,461 |
|
|
228,031 |
|
|
31,903 |
|
|
|
593,894 |
|
|
751,626 |
|
|
105,157 |
|
Interest income, net |
(8,440 |
) |
|
(25,213 |
) |
|
(13,825 |
) |
|
(1,934 |
) |
|
|
(58,088 |
) |
|
(62,913 |
) |
|
(8,802 |
) |
Income tax expense |
35,307 |
|
|
61,856 |
|
|
19,924 |
|
|
2,788 |
|
|
|
161,802 |
|
|
158,314 |
|
|
22,149 |
|
Depreciation and amortization |
35,959 |
|
|
31,112 |
|
|
32,153 |
|
|
4,498 |
|
|
|
111,356 |
|
|
95,767 |
|
|
13,398 |
|
Share-based compensation |
60,632 |
|
|
17,732 |
|
|
7,954 |
|
|
1,113 |
|
|
|
99,931 |
|
|
40,385 |
|
|
5,650 |
|
Adjusted EBITDA |
(12,334 |
) |
|
239,948 |
|
|
274,237 |
|
|
38,368 |
|
|
|
908,895 |
|
|
983,179 |
|
|
137,552 |
|
Adjusted EBITDA margin |
-0.6 |
% |
|
10.8 |
% |
|
13.3 |
% |
|
13.3 |
% |
|
|
10.2 |
% |
|
15.7 |
% |
|
15.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Prior period financials have been recasted to reflect the
acquisition from CreditEase under common control. |
|
|
|
|
|
|
|
**The Company reclassified 368.2 million payments made in the
second quarter of 2019 related to future acquisitions from cash
used in operating activities to cash used in investing
activities. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delinquency Rates |
|
|
Delinquent for |
|
|
15-29 days |
|
30-59 days |
|
60-89 days |
All Loans |
|
|
|
|
|
|
December 31, 2015 |
|
0.7 |
% |
|
1.2 |
% |
|
1.0 |
% |
December 31, 2016 |
|
0.6 |
% |
|
0.9 |
% |
|
0.8 |
% |
December 31, 2017 |
|
0.8 |
% |
|
1.0 |
% |
|
0.8 |
% |
December 31, 2018 |
|
1.0 |
% |
|
1.8 |
% |
|
1.7 |
% |
March 31, 2019 |
|
0.9 |
% |
|
1.9 |
% |
|
1.7 |
% |
June 30, 2019 |
|
1.1 |
% |
|
1.8 |
% |
|
1.9 |
% |
September 30, 2019 |
|
1.0 |
% |
|
1.8 |
% |
|
1.6 |
% |
|
|
|
|
|
|
|
Online Channels |
|
|
|
|
|
|
December 31, 2015 |
|
0.5 |
% |
|
0.8 |
% |
|
0.6 |
% |
December 31, 2016 |
|
0.5 |
% |
|
0.9 |
% |
|
0.8 |
% |
December 31, 2017 |
|
1.1 |
% |
|
1.1 |
% |
|
0.9 |
% |
December 31, 2018 |
|
1.2 |
% |
|
2.3 |
% |
|
2.2 |
% |
March 31, 2019 |
|
1.2 |
% |
|
2.6 |
% |
|
2.4 |
% |
June 30, 2019 |
|
1.4 |
% |
|
2.2 |
% |
|
2.6 |
% |
September 30, 2019 |
|
1.3 |
% |
|
2.4 |
% |
|
2.3 |
% |
|
|
|
|
|
|
|
Offline Channels |
|
|
|
|
|
|
December 31, 2015 |
|
0.7 |
% |
|
1.2 |
% |
|
1.0 |
% |
December 31, 2016 |
|
0.6 |
% |
|
0.9 |
% |
|
0.8 |
% |
December 31, 2017 |
|
0.6 |
% |
|
0.9 |
% |
|
0.7 |
% |
December 31, 2018 |
|
0.9 |
% |
|
1.6 |
% |
|
1.5 |
% |
March 31, 2019 |
|
0.8 |
% |
|
1.6 |
% |
|
1.5 |
% |
June 30, 2019 |
|
1.0 |
% |
|
1.6 |
% |
|
1.7 |
% |
September 30, 2019 |
|
0.9 |
% |
|
1.5 |
% |
|
1.4 |
% |
|
|
|
|
|
|
|
Net Charge-Off Rate for Upgraded Risk Grid |
Loan Issued Period |
|
Customer Grade |
|
Amount of Loans Facilitated During the
Period* |
|
Accumulated M3+ Net Charge-Off as of September 30,
2019* |
|
Total Net Charge-Off Rate as of September 30,
2019* |
|
|
|
|
(in RMB
thousands) |
|
(in RMB
thousands) |
|
|
2015 |
|
I |
|
4,894,936 |
|
201,064 |
|
4.1 |
% |
|
|
II |
|
14,492,035 |
|
486,144 |
|
3.4 |
% |
|
|
III |
|
11,272,838 |
|
711,683 |
|
6.3 |
% |
|
|
IV |
|
11,283,656 |
|
1,357,155 |
|
12.0 |
% |
|
|
V |
|
11,199,563 |
|
1,718,367 |
|
15.3 |
% |
|
|
Total |
|
53,143,029 |
|
4,474,413 |
|
8.4 |
% |
2016 |
|
I |
|
5,858,273 |
|
234,148 |
|
4.0 |
% |
|
|
II |
|
12,360,346 |
|
532,664 |
|
4.3 |
% |
|
|
III |
|
9,951,614 |
|
749,365 |
|
7.5 |
% |
|
|
IV |
|
8,652,543 |
|
922,419 |
|
10.7 |
% |
|
|
V |
|
16,982,336 |
|
2,603,436 |
|
15.3 |
% |
|
|
Total |
|
53,805,112 |
|
5,042,032 |
|
9.4 |
% |
2017 |
|
I |
|
10,431,218 |
|
670,341 |
|
6.4 |
% |
|
|
II |
|
12,270,230 |
|
1,507,339 |
|
12.3 |
% |
|
|
III |
|
13,837,922 |
|
2,183,484 |
|
15.8 |
% |
|
|
IV |
|
13,663,558 |
|
2,356,569 |
|
17.2 |
% |
|
|
V |
|
19,680,365 |
|
3,968,677 |
|
20.2 |
% |
|
|
Total |
|
69,883,293 |
|
10,686,410 |
|
15.3 |
% |
2018 |
|
I |
|
9,451,125 |
|
486,383 |
|
5.1 |
% |
|
|
II |
|
14,656,758 |
|
1,338,476 |
|
9.1 |
% |
|
|
III |
|
13,903,217 |
|
1,624,453 |
|
11.7 |
% |
|
|
IV |
|
13,812,989 |
|
1,961,234 |
|
14.2 |
% |
|
|
V |
|
11,326,230 |
|
1,886,516 |
|
16.7 |
% |
|
|
Total |
|
63,150,319 |
|
7,297,061 |
|
11.6 |
% |
2019H1 |
|
I |
|
3,911,679 |
|
28,326 |
|
0.7 |
% |
|
|
II |
|
6,050,230 |
|
86,221 |
|
1.4 |
% |
|
|
III |
|
4,993,682 |
|
97,867 |
|
2.0 |
% |
|
|
IV |
|
3,220,517 |
|
63,400 |
|
2.0 |
% |
|
|
V |
|
2,432,632 |
|
56,458 |
|
2.3 |
% |
|
|
Total |
|
20,608,740 |
|
332,273 |
|
1.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
M3+ Net Charge-Off Rate* |
Loan Issued Period |
|
Month on Book |
|
|
4 |
|
7 |
|
10 |
|
13 |
|
16 |
|
19 |
|
22 |
|
25 |
|
28 |
|
31 |
|
34 |
|
2015Q1 |
|
0.8 |
% |
2.0 |
% |
3.4 |
% |
4.7 |
% |
5.7 |
% |
6.5 |
% |
7.1 |
% |
7.5 |
% |
7.7 |
% |
7.8 |
% |
7.8 |
% |
2015Q2 |
|
0.8 |
% |
2.3 |
% |
3.8 |
% |
5.2 |
% |
6.4 |
% |
7.3 |
% |
7.9 |
% |
8.3 |
% |
8.5 |
% |
8.7 |
% |
8.8 |
% |
2015Q3 |
|
0.4 |
% |
1.6 |
% |
3.1 |
% |
4.4 |
% |
5.6 |
% |
6.5 |
% |
7.1 |
% |
7.6 |
% |
7.9 |
% |
8.1 |
% |
8.4 |
% |
2015Q4 |
|
0.4 |
% |
1.6 |
% |
3.1 |
% |
4.4 |
% |
5.5 |
% |
6.3 |
% |
6.9 |
% |
7.4 |
% |
7.9 |
% |
8.3 |
% |
8.5 |
% |
2016Q1 |
|
0.3 |
% |
1.2 |
% |
2.5 |
% |
3.6 |
% |
4.5 |
% |
5.2 |
% |
5.8 |
% |
6.4 |
% |
7.0 |
% |
7.4 |
% |
7.6 |
% |
2016Q2 |
|
0.4 |
% |
1.6 |
% |
3.1 |
% |
4.3 |
% |
5.2 |
% |
6.0 |
% |
6.8 |
% |
7.6 |
% |
8.1 |
% |
8.4 |
% |
8.7 |
% |
2016Q3 |
|
0.3 |
% |
1.6 |
% |
3.1 |
% |
4.3 |
% |
5.4 |
% |
6.6 |
% |
7.8 |
% |
8.6 |
% |
9.2 |
% |
9.5 |
% |
9.8 |
% |
2016Q4 |
|
0.2 |
% |
1.5 |
% |
2.9 |
% |
4.4 |
% |
5.9 |
% |
7.4 |
% |
8.4 |
% |
9.3 |
% |
10.0 |
% |
10.4 |
% |
|
2017Q1 |
|
0.3 |
% |
1.5 |
% |
3.2 |
% |
5.1 |
% |
7.1 |
% |
8.6 |
% |
9.8 |
% |
10.8 |
% |
11.5 |
% |
|
|
2017Q2 |
|
1.1 |
% |
2.9 |
% |
5.6 |
% |
8.4 |
% |
10.4 |
% |
12.1 |
% |
13.5 |
% |
14.5 |
% |
|
|
|
2017Q3 |
|
0.3 |
% |
2.9 |
% |
6.3 |
% |
9.1 |
% |
11.6 |
% |
13.6 |
% |
15.0 |
% |
|
|
|
|
2017Q4 |
|
0.5 |
% |
3.8 |
% |
7.2 |
% |
10.4 |
% |
13.2 |
% |
15.3 |
% |
|
|
|
|
|
2018Q1 |
|
0.4 |
% |
3.0 |
% |
6.6 |
% |
10.1 |
% |
12.9 |
% |
|
|
|
|
|
|
2018Q2 |
|
0.5 |
% |
3.6 |
% |
7.4 |
% |
10.8 |
% |
|
|
|
|
|
|
|
2018Q3 |
|
0.3 |
% |
2.9 |
% |
6.2 |
% |
|
|
|
|
|
|
|
|
2018Q4 |
|
0.3 |
% |
2.5 |
% |
|
|
|
|
|
|
|
|
|
2019Q1 |
|
0.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*As one division has already been spun off from the company, as of
third quarter 2019, M3+ net charge-off rates no longer reflect the
risk performance of loans generated by this division. |
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