Yiren Digital (YRD) 17 Aug 232023 Q2 Earnings call transcript

Thank you for standing by, and welcome to the Yiren Digital Second Quarter 2023 Earnings Conference Call. All participants are in a listen only mode. There will be a presentation followed by a question-and-answer session. [Operator Instructions] today's conference call is being recorded.

I would now like to turn the conference over to Lydia Yu of Investor Relations. ma'am. ahead, go Please

Ning and Today's our by call CEO our Chairman everyone, Na CFO, Earnings Mei. the Quarter Conference and CEO, and CreditEase Call. features of and welcome Hello, our Second Ms. to XXXX Founder, Tang Thanks. prepared remarks

would remind of Private U.S. beginning, contain Reform discussions Act call you Securities during of we Before statements harbor made provision that this XXXX. forward-looking under like to the safe Litigation

statements involve inherent Forward-looking uncertainties. and risks

from our company's the regarding the may the results Further or materially different U.S. expressed such, information views As future factors be today. is filings SEC. uncertainties risks, included in with

not undertake do forward-looking laws. update any statements as We obligation under development any required to

review measures referring or These we U.S. this be financial GAAP. and certain are will in our to During and to non-GAAP substitute with to a operating information isolation not performance. in financial prepared be considered presented measures intended financial non-GAAP the call, for assess as and measures supplemental accordance

about information to reconciliations these measures, release. GAAP For earnings and press our please refer non-GAAP measures to

I on our remarks. opening for to will it CEO, Ning, pass now

Thank earnings today. conference you for all joining our call

technology-driven new Before positioning would like our into quarter, and the I I first services review AI business jump to platform. lifestyle updates for financial and and corporate

with Our services key underlying aligns is technologies. business pillars; flows new that and by consumption with three AI lifestyle positioning strategies better anchored financial and by our model business and services, driven insurance, operational

a that as be productivity tools we respond will customer available AI our large new will to service which AI lines. XX/X develop was to work marketing models build lab, what AI last that customer virtual are AI customized examples generative inquiries, few we'll productivity. business and our enhance and working on company's established technologies, applications AI-assisted to across products A language The to quarter, on as focus and the tools well include officially utilizing of and agent

during more future about share details earnings conference and to AI progress call. continue will I

billion, Second Next, reached on mainly of policies the life life new which up in year-over-year. companies in XXXX, business. the insurance gross The spike insurance of to RMB interest the this products lower our insurance first of update brokerage policy X% Total and Quarter sales timing quarter selling life premiums from interest X% requires XXX% increased all year-over-year, an newly rate above developed X.X more that than their regulation insurance by driven pricing to was X.X% to rate. discontinue products of XX%

noted first average And agent million this to As digitization, we increased RMB we of grew and key productivity The XX% policy by our innovation number of and premiums XXX%. customization exceeding life continue three quarter, successes increased XXX% agents insurance X invest and development in average product year premiums quarter-over-quarter. quarter-over-quarter.

policies last call, pace, a total for market on our segment as new insurance, fast property XX% for a this overseas and On the are we key mentioned continue is premium construction grow quarter-over-quarter. reinsurance at to focusing increasing product on

volume total the RMB XX% billion, X.X Next, a Services. Second year-over-year. Quarter Financial In representing loan increase XXXX, on of was

quarter Hua, increase of the our on user from tech, XX% increase prior over LTV X.XX significant Xiang Second Yi year from to increased prior million this Quarter per quarter to average X.Xx on million the to per XXXX, borrower. user in APP X.Xx which Yi increased number transactions a borrowers from of XX% Hua RMB indicating and active number up Xiang the fastest-growing number X.X our total of The continues ratio monthly product, be quarter, to from loan continues in to

have under consumer our launched the the finance growth we worldwide. last in and promote which Philippines things. the We seen that expanding in Last expertise have quarter, hope I Peso inclusion greater started rapid leverage mentioned to quarter we in sector financial brand internationally Easy to

As our models, in local have seen and continued improvement operational flows risk margins. to continued our team we a enhance refine

we in have evaluating the success two the regions near other achieved to initial countries also future. With expand and started new in Philippines, to expect one to

On noted a we at compared costs XX compared quarter. with institutional On delinquency the continue last our front, as X.X% to remained funding to delinquencies we funding beginning X.X% June cost of diversify funding to in to quality, X% asset sources the XX decrease days year. in as rate stable

to quarter for The this quarter lifestyle number million. that to everything and I'm of want proud accomplished. consumption we've total paying X.XX this XX% XX% quarter million. from total To increased from of services, GMV increased On RMB I quarter conclude, generated say really to prior members team XXX prior our

So years road ahead I'm but all and with being about quite us. far, the been on you it's to this optimistic a grateful journey challenging for few

With now will pass Na, who that, for to this through the I'll financials it quarter. go

deck financial single-digit of only Quarter as performance billion, from Second projection call, On Hello, a total billion over of details. on will this strong for quarter, our showing release, facility reached reached highlights. and quarter products everyone. continue earnings a prior see the analysis our XX% growth. [indiscernible] to quarter. I this XX% demand this total On revenue RMB quarter for of compared despite services, IR average strong In representing loan X.X we to to increase X.X focus this with macroeconomics XX% Please prior representing financial sequence further year-over-year financial our and refer industrial year, increase key more challenged growth

insurance a premiums gross representing increase policy driven written a XX% and insurance billion, XX% Our from increase strong probably X.X year-over-year prior quarter, sales. RMB reached by life

XXX on the XXX.X Select XX% net service, total for representing RMB reached succession RMB of brokerage XX% increased increased GMV the quarter. and quarter, the quarter billion, total On prior reached revenue. insurance Yiren million year-over-year XXX% for from for Revenue

expense XX% drive from On and last this to the marketing investment other startup XXX side, in our our million sales mainly quarter and marketing to quarter, increased growth. due RMB brand further to

costs increase quarter medium XXX prior relating our by XX% increased to to sector. from insurance million, worker sales Origination, other RMB dry and servicing and general operating costs on

X% and counter XX our service expenses administrative quarter, as for of relatively sector million. million revenue of expense this facility. our [indiscernible] [XX%]. and and Allowance loan remaining stable total at for a by insurance XX percentage the contract receivables for for [indiscernible] RMB quarter-over-quarter General X.X% RMB around was has minus remained stable However,

our the of XX% generally was bottom Total this cash Until increase this deliver operating XX% million this line, tax we net We XXX RMB RMB to and prior quarter. million strong quarter, quarter-over-quarter. cash XXX an from end billion by RMB quarter. profit quarter, of from of X.X continue equivalent a increased [indiscernible]

China financial provide the well to entire June, guarantee enable in business guarantee announced business us models. as segment in company we which Early will of the other acquisition continue financial to and licensed credit as company our

to continue for investment foster opportunities and business Going seek out to forward, new growth. strategic we initiatives will

we Generally, opportunity. our program. we in business remain share to confident our Therefore, repurchase continue and the execute company's growth fundamental

close deployed USD have to pay we back the quarter, in This to million our shares market. X company

profit of to to has company to projects the close million be [indiscernible] tended June X.X total Based X.X between remain As [indiscernible] USD billion this RMB the in Third year for stable. revenue Quarter company business market on a payback. net accumulated XXXX, margin XX, of conditions, preliminary our to and billion of the with around X.X RMB the assign

questions. With remarks. that, closing for our we open Operator, conclude we'll now up

The Private investor. comes Lean, from [Operator first question Instructions] Andrew

dividend? very XX% you to [indiscernible] a dividend it it Also, they do Would the the the as a just legitimize I is is the [indiscernible] you question increase did low. price are consider and owner company stock and that want -- official. calculated of volume to very Buybacks, hard My volume. the with I it guess company. this will currently, is is it's

Another question.

about auditing. The second question would be your

legitimacy $XXX go could paper. than numbers X the company it amazing market X auditors and in you like cap to The the financial $XXX talk of and statement that took about fact looks If ahead million currently. cash, on year get It and million your in has audited. and latest the more

numbers So very about the of happens. why I'm that the and curious legitimacy

answer the I comment will question. Na Yes. first And question. auditing on will the

is global intention We strategic our for leading We impact initiative. to company is have because company digital being flagship delist strategic that objective. the a our no believe

as not sector. the trouble few terms regarding And only past cost well in for as you in what the well -- have about current us stable collectively not fintech, valuation, conditions, know, players challenges, of market years so other geopolitical but may for also

that doing smart at been is And are also confident and hard to leader we've work with communicating years our a with remember clear in few we on and strategy What market. back, job regarding hoping, a work. business also fundamentals And we and better hard are may the we very do you market a and operations. were the to

can help things and invest leadership have future, market We a large we the relatively price expansion. that And position. like will also, position our including into AI global regain us

mentioned, view, AI we markets very that my new expanding leader. my global which to will is time, are is And transformed In a the impact years' my in be other company hope significant view. promising in X be will into I a As direction. very

also of you you Tang, volumes. price owned could CEO dividend comment do dividend. the if comment XX%. again, stock policy? But policy,[indiscernible] They're recently Ning it the could on by a Tech, in on possible would Mr. the and could like I if Like dividend grew you in

currently, policy. and yes, keep currently no been possibilities, evaluating is us, help we we future. uncertain And strategies. stand yes. potential have any that, can the But Yes. different Yes, for strong this view off also our investing yes, cash is this I've different speaking, and dividend me such Yes, position challenges

you the volume? employees like price X to volume question. in value repurchase to idea and want your would in consider also of high, another Okay. XYF. bought that stocked. if order daily They that Financial needle out you trading price But back discount could are to the have directly couldn't shares, shares be is the move Maybe they consider increasing Also increase, you very the stock of buybacks the from stock

that? So from consider could buying you employees,

regarding honest, That's regarding and be upside the able value been job are the we they stakeholders. love with that also much why and team market, really disappointed try said to we To company, that to will our deserve deliver we shares, members But just better with it. communicating a I employee yes, I enjoy price. also share believe do haven't

them much after suppose very the valuation. upside buying low to want I from enjoy shares them So this as to

maybe X because volume company, did Xx introduction, the which yield a quarters. right big a dividend months. now XX% price it's increase for dividend Consider the policy And Xx Okay. of in healthy much this had stock made dividend [indiscernible] more consider policy they next and entered again, and dividend

So they [indiscernible] later in or YRD like X% paying they're to paid and months, X% similar opinion. already. in X now X% my

for your suggestion. Thank you

your Relations. first. I clarify question, second Lydia, On Investor can quickly you is This with

year in on this auditing. which Your report on [indiscernible]. Because is with question our is actually April, that we know released I annual par

I just what to asking wanted on our you're on clarify So update.

resolved. was that change the Then KPMG. It from was just

Financial just report because there auditor. later no was

for So released out number. it our report, a auditors with took it side XX April get this on to of -- time XXXX year. the some was annual But new for on

The next comes Securities from Corporation. question with National Larson Matthew [Operator Instructions]

things. Hello. A couple of

On and the got subject of back. the buybacks, call had to off I cut

you you So stock of it, $XX maybe mentioned million to this worth scheduled buy back are year.

degree. Your volume constrained to a certain

the to can weekly considerably months it shares with first the have volume last as daily months a you comes far higher the than over percentage? X basis the But are back What the of as or this averaged has you on restrictions amount year. buy X when

Can regarding please that Na answer question buybacks.

question. this will answer I Yes,

have mentioned, payback Sandvik average our restriction we amount. you follow implant on the limited amount XX% put is of the Basically, up the company payback that we normal the amount. the As liquidity than provide our the forward shares to restriction

the about So we have much XX% value. of marketing with to the [indiscernible] comply rule the total -- you

tell the if And before the have could year year-to-date that you back me started. you was bought $XX million much how announced of

Yes.

payback latest that about and for accumulated is the X purchase program in last amount revenue. as year amount As I million as today is mentioned XX year, [indiscernible] by we announced this and by my mentioned, share your script, of the the USD June USD new

Okay.

I buyer. you unless tough mean, get your I in you've there going to to a be volume $XX million been up. it's So significant mean the pretty get

-- before Here's on off been your times. and I've few company. investor call I've with a the conference been a long-term on

a the XXXX, I in ultimately that Stanley you've in but business IPO highly to going not when lender when of agencies was Morgan $XX at peer-to-peer you I the yourselves. December your your frankly, reinvented and were by at as regulated was stock in when participated PRC governmental

financial But still services be growth and have a I mean and lender, yes, guess, you're but capital-light you. what a your I seems insurance lender from to real

loan those $XXX banks the loans you've that's because million book in is got But do and that point books a have of have authorities regulatory what answer books, of on about your that strategy any of You keep $X far still capital-light keep the prefer cash, you billion. since I Do me, you to to on risk the as for appease loans the would more as think, view a great you regulators. you all. please? Could the

have I used actually, payment in our so have we to to would have question, our mention answer cash finance also your you client. own service our own balance we funding big

service We Entrust million, we by and the And and own financial we our with have year. we trust company cooperated they also so, can company both have and $XXX to use also licenses competed our to financial with in this this [indiscernible]. have have now, quality license

guarantee acted as also have financial other the with can guarantees funding our service also with [indiscernible], a way in to partners customers, guarantee financial our our compete July our balance. mentioned quality the also give And cost I a As to cash -- also which company. business we June, can and will company company direct in cooperation in to

keep use our course, companies other development. our cash balance to keep will still Yes, our cooperating we to with of [indiscernible] to company financial business

less the questions on more of have. trade always I the you couple price, A than I stock caller for Okay. previous earnings. mean forward Xx commented which

of mean, exchange about anywhere of PRC at trade exist cash You would these X/X of any balance. not the your Chinese I stock. sorts outside on valuations

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few very news You put out releases.

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often or coverage maybe I'm though but That's research other conference calls, that, even one followed Stanley person, problems to Suisse too you got any I'm your Morgan Credit When low. your used by only and about the one even these companies price dropped when the they stock on have and like knows covering don't of you you company. be nobody person

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would a my strong be on part. recommendation So that

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have all all earnings, and employees up suggestion. tenfold? would with like you XXx about right, to would How the So cash you my would your your be stock that all XXx, see

I think sense, frankly. common it's

other of you you I you want to do of suggestions to -- I or to do some a that some just a at my the wolf with mean, callers take you. want looking of be be So price, stock mouse, hope honest also and be your and

see but your appreciate I that's very all to Thank So say, reforms. have to you tremendous and of performance. much, hope these I I some

it. Got

You'll we and have you time yes, yes, and triple And AI effort, now this Last and appreciate loud your clear. our more I son. I more. communications we'll marketing consider hiring And so heard see double more more. that probably

He's Instagram, I'm clear. this. name suggesting TikTok, that Twitter, not he's -- it. make skill saying I'm going young in person's it on not Well, I'll doing set a you

of think and concentrated That's in it. people knew your $X all Just bought X,XXX stock of $X,XXX they worth about million stock. an interest

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So investor. very great to thank an continue much. I'll you be Have quarter. a

stock the if starts size, on I strength, and I'm buy guy. okay, just in one to But and lift,

consider please lose, been do of and to some you the what would my years for I So buy all suggestions right? XX side as I've on got

we will Yes, absolutely.

private follow-up a investor. from have [indiscernible], question We a

Hello.

would like So the if of[indiscernible], don't Again, a CEO like the eyes. they CEO Ning dividend, it towards investors the and know just stated, and may again following [indiscernible] knows what did and is their but Tang, dividend Mr. I investors the did volume you it X.X X% enough to -- cut the want a dividend. Yang, I And company. I cash dividend of other bring to doing the to be shareholders add

if also might under the the That's do. everything see your deep I a previous surging and because dividend dividend, Of again, company which can find insanely think do investors it. caller is play. what stated you in would for dividend valid They pops But it consider are course, I value place. standalone

caller but did not state the to dividend. repeat And sorry previous myself, the

We you. heard it. Got

on work yes, other will, and We yes, evaluating these possibilities.

help also. -- And roadshows will roadshows

Okay.

session question-and-answer well call. for the concludes presentation. This you Thank the as today's as attending

disconnect now lines. your may You

constructive for much comments, you this yes all very suggestions. and remarks Thank

you. Thank We will work along these lines.