X Financial (XYF) 16 Jun 212021 Q1 Earnings call transcript

Good day and welcome to the X Financial First Quarter 2021 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Tanya Wen. ahead. go Please

Hello, today. operator. and thank for at you available Thank Company's everyone, results us ir.xiaoyinggroup.com. website IR The the today were joining on you, Company's and released are earlier

or Kan market to all X from uncertainties risks go law. events the call of to Q&A introduce Frank the to relate obligation all future of uncertainties the pleasure will under Company's followed a to difficult Harbor from that forward-looking and the by Further and Mr. which any Financial are cause available update brief Li, today result Li. session. It U.S. many differ does are and call of and performance involve achievements other Securities Chief and new is They Mr. through please Private that with the and factors I unknown as the Financial remind information, Mr. not the Company's statements events risks, current in as regarding management's Company's the President; my filings undertake risks, except Such Zheng, to forward-looking are Exchange Commission. of any XXXX. may the the will Mr. required or may Kan Li Mr. operating questions who ahead. now of you Company which a this otherwise highlights included in on or conditions control provisions The the under information materially factors, your Mr. actual to and of results, beyond go other during those predict are, Act financials. Company's and statements. which is Officer. overview statements contain expectations based forward-looking Zheng, and and Reform Li, give known statements Securities Litigation are answer current operations On Safe the business

Hello, everyone.

to the objectives. a on the quarter year to strategic financial pleased against amid our fully China. report very business COVID-XX our XXXX, of strong In and first of operational subsiding in as We our progress are show trajectory back results continued is pandemic growth both start its the

both basis with Our increase amount. and improved in our yearly a line loan quarterly in the on topline substantial significantly facilitation

managed also our quarter income We fourth compared and of the the turn profitable XXXX, COVID-XX before just to with exceeding net with pandemic. guidance outperforming

During an representing driven strong This of years. the was total high XX.X% two amount billion, growth the XX.X% of our last loan quarter-over-quarter, increase the first year-over-year by mainly facilitation a quarter, of amount Card loan and RMBXX.X reached record of in Xiaoying facilitation we XX.X% Loan, quarter XX.X% quarter-over-quarter. shifted which compared last first year, Card facilitation increased focus which amount accounted quarter. loan in year-over-year for and to the for product the previous XXX% have Since Xiaoying total of XXX.X% our with Loan, XXXX,

product deliver to proven focused borrowers be gaining effective has in among strategy profitable Our growth. traction and

RMBXX.X outstanding of of end with XXXX, the quarter. XX.X% As of total prior loan compared an Xiaoying of the increase reached Card Loan balance billion, March

In Xiaoying going more exploring coverage we of our beyond. on address uncertainties strategies to and products Card XXXX and development needs Loan consumers' with is geographic flexibility diversified opportunities navigate regional continue financial will macroeconomic We focus one us enhance the help This institutions. our in more funding A cooperate growing reach business sources. key further our service by expand the working to business and will been and financing forward. our in expand enhance to to have meantime,

improve which as the we May analytics, the to Shenzhen an micro set taking to Regulatory will addition, individuals. will and major individuals small Local financial a Bureau XXXX, Such beyond management approval by one an and is data is the provide VIEs regulatory risk further compliance. further more transform businesses and received a financing, our from businesses In and our of asset the government its we and up introducing micro entity Ltd., towards Xiaoying measures In full expand to online a microcredit Co., strengthen of Financial advanced growth. operating for also business and is large series Municipality self-employed effective the contributors microcredit Microcredit promote Xiaoying PXP purpose of approval and from drivers of of more small China, the quality. Xiaoying The of Shenzhen of which development kind in consumer of business. are economic China's active company and a It Microcredit to services newly our self-employed established services key first comprehensive milestone Microcredit, successfully a business. to is pool

institutions, costs. We intermediate and our credibility our with us to including of cooperate benefit institutions financial This licensed enhance will give financing advantage their needs. financial license other meet when cutting we the with will cooperate other the

to quarter We in the of are expecting XXXX. third commence operation

forward, our cooperation full businesses the growth continues our micro throughout our year. with trusted compliance, and markets have believe financing our demand great and services we products to capture opportunities Moving ahead and momentum with grow to consumer institutions. we positioned China's deepening and market maintain current are brand, small well expect potential. regulatory financial for and We to financing

financials. the call through go turn to Frank, Now, our who will will I

and you, Thank hello Kan, everyone.

financial increased We RMBXXX.X during are XX.X% delivered the to quarter. and to pleased quarter-over-quarter have XX.X% Total year-over-year million. revenue first net a performance strong

of resulted borrower a efficiency enhanced quarter mainly previous the and the from our year compared net line bottom base. was in net net premium of significant income loan topline loss our a growth loss the and for of strong with This improvement the in in amount, extensive in quarter. RMBXXX.X RMBXXX.X million million last Our period RMBXXX.X facilitation million, and same operational

loan quarter, covered of increased quarter. the XX.X% facilitated third-party previous amount guarantee by companies from During to first the we financial the proportion XX.X% in

to throughout year. our conclusion, expand In improved optimize ability with companies financial we with progress this our strengthened our institutions. Our the financing deepen has reputation financial in quarter guarantee and the costs have and will on and to markets third-party borrowers further cooperation efforts the to agenda made position for and expand remain partnerships

entering a additional financing our in are enormous the of growth of and industry shareholders. gets on our explore well. business and capabilities the are to core our ready back deliver to confident new journey microcredit we return to sector consumer our of We the track opportunities remain chapter long-term as We as potential and

of was receivable same of income million US$XX.X same amount compared same attributable to US$XXX.X in period some total Provision Financial RMBXXX.X was in XXXX, in first in Total estimated would loss first the the quarter million, quarter the period with product quarter the decrease and change by with of for that the that in due period March loss a US$X.X operation a first same XXXX. compared of of was compared compared compared with with loan I of million to of RMBXXX.X brief loan from X a million, RMBXX.X in million, Net Xiaoying of that attributable XXXX. due RMBXXX.X XXXX facilitation in default the RMBXXX was in in adjusted expenses net from offset the million Financial in in to Origination million, the Card by Loan default shareholders the net to of XXXX, in when Financial XXXX. for million, in period total accounts due XX, same RMBXXX with in RMBXXX.X servicing to cost XXXX increase facilitation in the this the Cash loss the Now to US$XX.X increase first million, from million, attributable million of million attributable first receivable contract of quarter commission total increased loan assets US$XX.X XXXX. US$XX.X mix resulting same US$X.X the in million, same average in RMBXXX.X and the financial in of Provision the US$XXX.X RMBXXX.X revenue the adjusted accounts the the of X of RMBXXX.X facilitation an RMBXXX compared of partially period estimated was RMBXXX.X quarter like XX.X% million the shareholders amount with with million of shareholders of RMBXXX.X the the million the rate XXXX, period XX, with net in quarter December was result increased shareholders in as primarily primarily the million, quarter the to period of RMBXX.X in the of RMBXX.X XXXX, facilitation RMBXX.X from of compared XXXX. XXXX. the XXXX due operations same million, quarter X period to the of in loan in fee primarily compared insurance this with same the the to compared rate primarily and XXXX receivable XXXX, same services quarter of million cash the the period the a million same with to from of XXXX, X and period average of in amount first Financial with from performance. Income XXXX. increased as quarter million of first XXXX XX% of equivalents period million, to XXXX XXXX. in million non-GAAP million, as increase compared by decrease Non-GAAP income of and first increase when

Now for business our outlook.

quarter forecast the the RMBXX.X current shareholders RMBXX of are the income to attributable This subject changes. in second of to billion less reflects RMBXXX billion than no the range loan million. be XXXX, Financial’s for X guidance to our raised preliminary net facilitations which and and to For be views, we total to

prepared would please. Now, call remarks Operator, and question. to the this we to concludes open like our

question-and-answer Instructions] will the session. begin We now [Operator

Tanya would to As our back concludes question-and-answer to Wen any conference for turn questions, this there the are over session. remarks. I like closing no

today. everyone, you, for joining the Thank on call us

chance questions, We to you the near If again through Thank be raise with to we look in to answer forward you. will your pleased you future. haven't speaking got them follow-up contacts. a

conference presentation. concluded. has The today's for now attending you Thank

may disconnect. now You