X Financial Reports Fourth Quarter and Fiscal Year 2023 Unaudited Financial Results

SHENZHEN, China, March 27, 2024 /PRNewswire/ — X Financial (NYSE: XYF) (the “Company” or “we”), a leading online personal finance company in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2023.

Fourth Quarter and Fiscal Year 2023 Operational Highlights

Three Months
Ended December
31, 2022

Three Months
Ended September
30, 2023

Three Months
Ended December
31, 2023

Twelve Months
Ended December
31, 2022

Twelve Months
Ended December
31, 2023

QoQ

YoY

YoY

Total loan amount facilitated and
originated (RMB in million)

21,700

29,462

26,134

(11.3 %)

20.4 %

73,655

105,557

43.3 %

Number of active borrowers

1,370,496

1,809,815

1,603,760

(11.4 %)

17.0 %

3,326,774

4,495,997

35.1 %

 

  • The total loan amount facilitated and originated[1] in the fourth quarter of 2023 was RMB26,134 million, representing an increase of 20.4% from RMB21,700 million in the same period of 2022.
  • The total loan amount facilitated and originated in 2023 was RMB105,557 million, representing an increase of 43.3% from RMB73,655 million in 2022.
  • Total number of active borrowers[2] was 1,603,760 in the fourth quarter of 2023, representing an increase of 17.0% from 1,370,496 in the same period of 2022.
  • Total number of active borrowers was 4,495,997 in 2023, representing an increase of 35.1% from 3,326,774 in 2022.

 

As of December 31, 2022

As of September 30, 2023

As of December 31, 2023

Total outstanding loan balance (RMB in million)

37,992

49,685

48,847

Delinquency rates for all outstanding loans that are past
due for 31-60 days

1.02 %

1.11 %

1.57 %

Delinquency rates for all outstanding loans that are past
due for 91-180 days

1.93 %

2.50 %

3.12 %

 

  • The total outstanding loan balance[3] as of December 31, 2023 was RMB48,847 million, compared with RMB37,992 million as of December 31, 2022.
  • The delinquency rate for all outstanding loans that are past due for 31-60 days[4] as of December 31, 2023 was 1.57%, compared with 1.02% as of December 31, 2022.
  • The delinquency rate for all outstanding loans that are past due for 91-180 days[5] as of December 31, 2023 was 3.12%, compared with 1.93% as of December 31, 2022.

 

[1] Represents the total amount of loans that the Company facilitated and originated during the relevant period.

[2] Represents borrowers who made at least one transaction on the Company’s platform during the relevant period.

[3] Represents the total amount of loans outstanding for loans that the Company facilitated and originated at the end of the relevant period. Loans that are delinquent for more than 60 days are charged-off and are excluded in the outstanding loan balance, except for Xiaoying Housing Loan. As Xiaoying Housing Loan is a secured loan product and the Company is entitled to payment by exercising its rights to the collateral, the Company does not exclude Xiaoying Housing Loan delinquent for more than 60 days in the outstanding loan balance.

[4] Represents the balance of the outstanding principal and accrued outstanding interest for loans that were 31 to 60 days past due as a percentage of the total balance of outstanding principal and accrued outstanding interest for loans that the Company facilitated and originated as of a specific date. Loans that are delinquent for more than 60 days are charged-off and excluded in the calculation of delinquency rate by balance. Xiaoying Housing Loan was launched in 2015 and ceased in 2019, and all the outstanding loan balance of housing loan as of December 31, 2022, September 30, 2023 and December 31, 2023 were overdue more than 60 days. To make the delinquency rate by balance comparable, the Company excludes Xiaoying Housing Loan in the calculation of delinquency rate.

[5] To make the delinquency rate by balance comparable to the peers, the Company also defines the delinquency rate as the balance of the outstanding principal and accrued outstanding interest for loans that were 91 to 180 days past due as a percentage of the total balance of outstanding principal and accrued outstanding interest for the loans that the Company facilitated and originated as of a specific date. Loans that are delinquent for more than 180 days are excluded in the calculation of delinquency rate by balance, except for Xiaoying Housing Loan. All the outstanding loan balance of housing loan as of December 31, 2022, September 30, 2023 and December 31, 2023 were overdue more than 180 days. To make the delinquency rate by balance comparable, the Company excludes Xiaoying Housing Loan in the calculation of delinquency rate.

 

Fourth Quarter 2023 Financial Highlights

(In thousands, except for share and per share data)

Three Months
Ended December
31, 2022

Three Months
Ended September
30, 2023

Three Months
Ended December
31, 2023

QoQ

YoY

 RMB   

 RMB   

 RMB   

Total net revenue

955,640

1,396,864

1,192,664

(14.6 %)

24.8 %

Total operating costs and expenses

(681,687)

(962,120)

(938,472)

(2.5 %)

37.7 %

Income from operations

273,953

434,744

254,192

(41.5 %)

(7.2 %)

Net income

274,639

347,190

188,968

(45.6 %)

(31.2 %)

Non-GAAP adjusted net income

277,939

374,507

230,782

(38.4 %)

(17.0 %)

Net income per ADS—basic

5.28

7.26

3.90

(46.3 %)

(26.1 %)

Net income per ADS—diluted

5.16

7.02

3.84

(45.3 %)

(25.6 %)

Non-GAAP adjusted net income per ADS—basic

5.34

7.80

4.74

(39.2 %)

(11.2 %)

Non-GAAP adjusted net income per ADS—diluted

5.22

7.56

4.68

(38.1 %)

(10.3 %)

 

  • Total net revenue in the fourth quarter of 2023 was RMB1,192.7 million (US$168.0 million), representing an increase of 24.8% from RMB955.6 million in the same period of 2022.
  • Income from operations in the fourth quarter of 2023 was RMB254.2 million (US$35.8 million), compared with RMB274.0 million in the same period of 2022.
  • Net income in the fourth quarter of 2023 was RMB189.0 million (US$26.6 million), compared with RMB274.6 million in the same period of 2022.
  • Non-GAAP[6] adjusted net income in the fourth quarter of 2023 was RMB230.8  million (US$32.5 million), compared with RMB277.9  million in the same period of 2022.
  • Net income per basic and diluted American depositary share (“ADS”) [7] in the fourth quarter of 2023 was RMB3.90 (US$0.55) and RMB3.84 (US$0.54), compared with RMB5.28 and RMB5.16, respectively, in the same period of 2022.
  • Non-GAAP adjusted net income per basic and adjusted diluted ADS in the fourth quarter of 2023 was RMB4.74 (US$0.67) and RMB4.68 (US$0.66), compared with RMB5.34 and RMB5.22, respectively, in the same period of 2022.

 

[6] The Company uses in this press release the following non-GAAP financial measures: (i) adjusted net income (loss), (ii) adjusted net income (loss) per basic ADS, and (iii) adjusted net income (loss) per diluted ADS, each of which excludes share-based compensation expense, impairment losses on financial investments, income (loss) from financial investments and impairment losses on long-term investments. For more information on non-GAAP financial measure, please see the section of “Use of Non-GAAP Financial Measures Statement” and the table captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release.

[7] Each American depositary share (“ADS”) represents six Class A ordinary shares.

 

Fiscal Year 2023 Financial Highlights

 Twelve Months Ended December 31,

(In thousands, except for share and per share data)

2022

2023

YoY

 RMB   

 RMB   

Total net revenue

3,562,950

4,814,884

35.1 %

Total operating costs and expenses

(2,480,657)

(3,377,202)

36.1 %

Income from operations

1,082,293

1,437,682

32.8 %

Net income

811,995

1,186,794

46.2 %

Non-GAAP adjusted net income

873,658

1,276,696

46.1 %

Net income per ADS—basic

15.42

24.72

60.3 %

Net income per ADS—diluted

15.12

24.48

61.9 %

Non-GAAP adjusted net income per ADS—basic

16.56

26.58

60.5 %

Non-GAAP adjusted net income per ADS—diluted

16.26

26.34

62.0 %

 

  • Total net revenue in 2023 was RMB4,814.9 million (US$678.2 million), representing an increase of 35.1% from RMB3,563.0 million in 2022.
  • Income from operations in 2023 was RMB1,437.7 million (US$202.5 million), compared with RMB1,082.3 million in 2022.
  • Net income in 2023 was RMB1,186.8 million (US$167.2 million), compared with RMB812.0 million in 2022.
  • Non-GAAP adjusted net income in 2023 was RMB1,276.7 million (US$179.8 million), compared with RMB873.7 million in 2022.
  • Net income per basic and diluted American depositary share (“ADS”) in 2023 was RMB24.72 (US$3.48) and RMB24.48 (US$3.45), compared with RMB15.42 and RMB15.12, respectively, in 2022.
  • Non-GAAP adjusted net income per basic and adjusted diluted ADS in 2023 was RMB26.58 (US$3.74) and RMB26.34 (US$3.71), compared with RMB16.56 and RMB16.26, respectively, in 2022.

Mr. Justin Tang, the Founder, Chief Executive Officer and Chairman of the Company, commented, “We are pleased to conclude the year with solid operational and financial results, emphasizing our commitment to sustained growth. In 2023, we facilitated and originated 43% more loans than in 2022 and delivered notable year-over-year growth in both revenue and profit. Total net revenue increased 35% on an annual basis, while income from operations increased 33%, and net income improved by 46%. However, as we entered the second half of 2023, particularly in the fourth quarter, we experienced increased risk levels in asset quality. While we strengthened our risk control system and implemented various measures to manage delinquency rates, we also made the strategic decision to proactively reduce loan volumes in the fourth quarter, prioritizing profitability over sheer volume growth.”

“For fiscal year 2024, our strategic approach will remain consistent and somewhat conservative, aligning with current market conditions in China. We believe the regulatory environment has become stable, and the government is committed to promoting economic recovery. However, we recognize that challenges and uncertainties exist as the country undergoes a transformative shift in its economic growth model away from the rapid expansion of the past, and structural adjustments are imperative. All of this has far-reaching impacts on various sectors, including our targeted market. Despite these challenges, we remain committed to executing our strategy and prioritizing profitable growth. Our commitment to delivering value to shareholders is unwavering, and we intend to pay dividends as and when profitability and smooth operations allow. This overall approach reflects our dedication to navigating the evolving economic landscape while ensuring the sustainable success of our business and returning value to our shareholders.”

Mr. Kent Li, President of the Company, added, “During the fourth quarter of 2023, our total loan amount facilitated and originated was RMB26 billion, a 20% year-over-year increase but an 11% quarter-over-quarter decline. Delinquency rates for loans past due for 31-60 days and 91-180 days were 1.57% and 3.12%, respectively, at the end of the quarter, compared with 1.02% and 1.93%, respectively, a year ago. Our team remains vigilant in monitoring asset dynamics and has taken further steps to mitigate risk by reducing our exposure to higher risk areas and adjusting our business approach to ensure sustainable profitability. We aim for continued gradual improvement over the course of 2024, and these measures have begun to have a positive impact on our risk indicators.”

Mr. Frank Fuya Zheng, Chief Financial Officer of the Company, added, “We are pleased to deliver solid financial results in 2023. Total net revenue increased by 35% year-over-year to RMB4.8 billion, and net income rose by 46% to approximately RMB1.2 billion. In response to heightened asset quality risks in the fourth quarter, we proactively reduced loan volumes to safeguard profitability, resulting in a 15% sequential decline in total net revenue for the quarter. We recognized RMB26.9 million and RMB46.8 million of impairment losses on long-term investments related to our indirect investment in Newup Bank of Liaoning in 2022 and 2023, respectively, mainly due to the depreciation in the market valuation of the Chinese banking sector. However, the bank’s loan portfolio and operations remain healthy, and we believe it continues to be a good investment for us. Looking ahead, we will not pursue pure loan volume growth at the expense of profitability, which is always our strategic focus to ensure long-term growth and returns to shareholders. We will continue to strengthen our risk management system to improve asset quality and balance our revenue and profitability growth.”

Fourth Quarter 2023 Financial Results

Total net revenue in the fourth quarter of 2023 increased by 24.8% to RMB1,192.7 million (US$168.0 million) from RMB955.6 million in the same period of 2022, primarily due to an increase in the total loan amount facilitated and originated this quarter compared with the same period of 2022.

 Three Months Ended December 31,

(In thousands, except for share and per share data)

2022

2023

YoY

 RMB   

 % of Revenue

 RMB   

 % of Revenue

Loan facilitation service

562,137

58.8 %

615,482

51.6 %

9.5 %

Post-origination service

106,777

11.2 %

166,807

14.0 %

56.2 %

Financing income

248,639

26.0 %

307,692

25.8 %

23.8 %

Other revenue

38,087

4.0 %

102,683

8.6 %

169.6 %

Total net revenue

955,640

100.0 %

1,192,664

100.0 %

24.8 %

Loan facilitation service fees in the fourth quarter of 2023 increased by 9.5% to RMB615.5 million (US$86.7 million) from RMB562.1 million in the same period of 2022, primarily due to an increase in the total loan amount facilitated this quarter compared with the same period of 2022.

Post-origination service fees in the fourth quarter of 2023 increased by 56.2% to RMB166.8 million (US$23.5 million) from RMB106.8 million in the same period of 2022, primarily due to the cumulative effect of increased volume of loans facilitated in the previous quarters. Revenues from post-origination services are recognized on a straight-line basis over the term of the underlying loans as the services are being provided.

Financing income in the fourth quarter of 2023 increased by 23.8% to RMB307.7 million (US$43.3 million) from RMB248.6 million in the same period of 2022, primarily due to an increase in average loan balances compared with the same period of 2022.

Other revenue in the fourth quarter of 2023 increased by 169.6% to RMB102.7 million (US$14.5 million), compared with RMB38.1 million in the same period of 2022, primarily due to an increase in referral service fee for introducing borrowers to other platforms and increase in guarantee income generated from financing guarantee business operated by a subsidiary which holds the financing guarantee license and commenced the financing guarantee business in 2023.

Origination and servicing expenses in the fourth quarter of 2023 increased by 28.3% to RMB755.2 million (US$106.4 million) from RMB588.7 million in the same period of 2022, primarily due to the increase in commission fees and collection expenses resulting from the increase in total loan amount facilitated and originated this quarter compared with the same period of 2022.

Provision for loans receivable in the fourth quarter of 2023 was RMB99.4 million (US$14.0 million), compared with RMB75.4 million in the same period of 2022, primarily due to an increase both in loans receivable held by the Company as a result of the increase in total loan amount facilitated and originated this quarter and in estimated default rate compared with the same period of 2022.

Income from operations in the fourth quarter of 2023 was RMB254.2 million (US$35.8 million), compared with RMB274.0 million in the same period of 2022.

Income before income taxes and gain (loss) from equity in affiliates in the fourth quarter of 2023 was RMB211.1 million (US$29.7 million), compared with RMB382.5 million in the same period of 2022.

Income tax expense in the fourth quarter of 2023 was RMB35.7 million (US$5.0 million), compared with RMB75.0 million in the same period of 2022.

Net income in the fourth quarter of 2023 was RMB189.0 million (US$26.6 million), compared with RMB274.6 million in the same period of 2022.

Non-GAAP adjusted net income in the fourth quarter of 2023 was RMB230.8 million (US$32.5 million), compared with RMB277.9  million in the same period of 2022.

Net income per basic and diluted ADS in the fourth quarter of 2023 was RMB3.90 (US$0.55), and RMB3.84 (US$0.54), compared with RMB5.28 and RMB5.16, respectively, in the same period of 2022.

Non-GAAP adjusted net income per basic and diluted ADS in the fourth quarter of 2023 was RMB4.74 (US$0.67), and RMB4.68 (US$0.66), compared with RMB5.34 and RMB5.22 respectively, in the same period of 2022.

Cash and cash equivalents was RMB1,195.4 million (US$168.4 million) as of December 31, 2023, compared with RMB1,427.9 million as of September 30, 2023.

Fiscal Year 2023 Financial Results

Total net revenue in 2023 increased by 35.1% to RMB4,814.9 million (US$678.2 million) from RMB3,563.0 million in 2022, primarily due to an increase in the total loan amount facilitated and originated this year compared with 2022.

 Twelve Months Ended December 31,

(In thousands, except for share and per share data)

2022

2023

YoY

 RMB   

 % of Revenue

 RMB   

 % of Revenue

Loan facilitation service

2,044,344

57.4 %

2,740,974

56.9 %

34.1 %

Post-origination service

372,451

10.5 %

596,582

12.4 %

60.2 %

Financing income

966,277

27.1 %

1,137,336

23.6 %

17.7 %

Other revenue

179,878

5.0 %

339,992

7.1 %

89.0 %

Total net revenue

3,562,950

100.0 %

4,814,884

100.0 %

35.1 %

Loan facilitation service fees in 2023 increased by 34.1% to RMB2,741.0 million (US$386.1 million) from RMB2,044.3 million in 2022, primarily due to an increase in the total loan amount facilitated this year compared with 2022.

Post-origination service fees in 2023 increased by 60.2% to RMB596.6 million (US$84.0 million) from RMB372.5 million in 2022, primarily due to the cumulative effect of increased volume of loans facilitated during the year. Revenues from post-origination services are recognized on a straight-line basis over the term of the underlying loans as the services are being provided.

Financing income in 2023 increased by 17.7% to RMB1,137.3 million (US$160.2 million) from RMB966.3 million in 2022, primarily due to an increase in average loan balances compared with 2022.

Other revenue in 2023 increased by 89.0% to RMB340.0 million (US$47.9 million), compared with RMB179.9 million in 2022, primarily due to an increase in referral service fee for introducing borrowers to other platforms and increase in guarantee income generated from financing guarantee business operated by a subsidiary which holds the financing guarantee license and commenced the financing guarantee business in 2023.

Origination and servicing expenses in 2023 increased by 34.9% to RMB2,869.8 million (US$404.2 million) from RMB2,126.7 million in 2022, primarily due to the following factors: (i) an increase in commission fees and collection expenses resulting from the increase in total loan amount facilitated and originated this year, and (ii) an increase in interest expenses as a result of an increase in payable to institutional funding partners and investors.

Provision for loans receivable in 2023 was RMB229.1 million (US$32.3 million), compared with RMB158.6 million in 2022, primarily due to an increase in loans receivable held by the Company as a result of the increase in the total loan amount facilitated and originated this year and in estimated default rate compared with 2022.

Provision for contingent guarantee liabilities in 2023 was RMB67.5 million (US$ 9.5 million) due to increase in guarantee liability arising from financing guarantee business operated by a subsidiary which holds the financing guarantee license and commenced the financing guarantee business in 2023.

Income from operations in 2023 was RMB1,437.7 million (US$202.5 million), compared with RMB1,082.3 million in 2022.

Income before income taxes and gain (loss) from equity in affiliates in 2023 was RMB1,403.1 million (US$197.6 million), compared with RMB1,223.5 million in 2022.

Income tax expense in 2023 was RMB249.4 million (US$35.1 million), compared with RMB389.4 million in 2022.

Net income in 2023 was RMB1,186.8 million (US$167.2 million), compared with RMB812.0 million in 2022.

Non-GAAP adjusted net income in 2023 was RMB1,276.7 million (US$179.8 million), compared with RMB873.7 million in 2022.

Net income per basic and diluted ADS in 2023 was RMB24.72 (US$3.48), and RMB24.48 (US$3.45), compared with RMB15.42 and RMB15.12, respectively, in 2022.

Non-GAAP adjusted net income per basic and diluted ADS in 2023 was RMB26.58 (US$3.74), and RMB26.34 (US$3.71), compared with RMB16.56 and RMB16.26 respectively, in 2022.

Cash and cash equivalents was RMB1,195.4 million (US$168.4 million) as of December 31, 2023, compared with RMB602.3 million as of December 31, 2022.

Recent Development

Share Repurchase Plan

In the fourth quarter of 2023, the Company repurchased an aggregate of 35,922 ADSs for a total consideration of US$143,400. Since the beginning of 2023, the Company had repurchased an aggregate of 837,729 ADSs for a total consideration of US$3.46 million. The Company has approximately US$5.5 million remaining for potential repurchases under our current share repurchase plan.

Declaration of Semi-Annual Dividend

The Company today announced that the Company’s board of directors (the “Board”) has approved a semi-annual dividend policy. Under this policy, the determination to declare and pay such semi-annual dividend and the amount of dividend in any particular half year will be made at the discretion of the Board and will be based upon the Company’s operations and earnings, cash flow, financial condition and other relevant factors that the Board may deem appropriate.

Pursuant to the semi-annual dividend policy, the Board has approved the declaration and payment of a semi-annual dividend of US$0.17 per ADS (approximately US$0.028 per ordinary share) for the second half of 2023. The holders of the Company’s ordinary shares shown on the Company’s record at the close of trading on May 10, 2024 (U.S. Eastern Daylight Time) will be entitled to these dividends. These shareholders, including the Bank of New York Mellon, the depositary of our ADS program (the “Depositary”), will receive the payments of dividends on or about May 31, 2024. Dividends to the Company’s ADS holders will be paid through the Depositary on or after May 31, 2024, and the precise timing of receipt will vary based on the processing efficiency of the respective holding brokerage.

Business Outlook

The Company expects the total loan amount facilitated and originated for the first quarter of 2024 to be between RMB21.0 billion and RMB22.5 billion.

This forecast reflects the Company’s current and preliminary views, which are subject to changes.

Conference Call

X Financial’s management team will host an earnings conference call at 7:00 AM U.S. Eastern Time on March 27, 2024 (7:00 PM Beijing / Hong Kong Time on March 27, 2024).

Dial-in details for the earnings conference call are as follows:

United States:

1-888-346-8982

Hong Kong:

852-301-84992

Mainland China:

4001-201203

International:

1-412-902-4272

Passcode:

X Financial

Please dial in ten minutes before the call is scheduled to begin and provide the passcode to join the call.

A replay of the conference call may be accessed by phone at the following numbers until April 3, 2024:

United States:

1-877-344-7529

International:

1-412-317-0088

Passcode:

3077685

Additionally, a live and archived webcast of the conference call will be available at http://ir.xiaoyinggroup.com.

About X Financial

X Financial (NYSE: XYF) (the “Company”) is a leading online personal finance company in China. The Company is committed to connecting borrowers on its platform with its institutional funding partners. With its proprietary big data-driven technology, the Company has established strategic partnerships with financial institutions across multiple areas of its business operations, enabling it to facilitate and originate loans to prime borrowers under a risk assessment and control system.

For more information, please visit: http://ir.xiaoyinggroup.com.

Use of Non-GAAP Financial Measures Statement

In evaluating our business, we consider and use non-GAAP measures as supplemental measures to review and assess our operating performance. We present the non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. We believe that the use of the non-GAAP financial measures facilitates investors’ assessment of our operating performance and help investors to identify underlying trends in our business that could otherwise be distorted by the effect of certain income or expenses that we include in income (loss) from operations and net income (loss). We also believe that the non-GAAP measures provide useful information about our core operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making.

We use in this press release the following non-GAAP financial measures: (i) adjusted net income, (ii) adjusted net income per basic ADS, and (iii) adjusted net income per diluted ADS, each of which excludes share-based compensation expense, impairment losses on financial investments, income (loss) from financial investments and impairment losses on long-term investments. These non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, investors should not consider them in isolation, or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP.

We mitigate these limitations by reconciling the non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures, which should be considered when evaluating our performance. We encourage you to review our financial information in its entirety and not rely on a single financial measure.

For more information on these non-GAAP financial measures, please see the table captioned “Reconciliations of GAAP and Non-GAAP results” set forth at the end of this press release.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars 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 RMB7.0999 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of December 29, 2023.

Disclaimer

Safe Harbor Statement

This announcement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “potential,” “continue,” “ongoing,” “targets,” “guidance” and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Any statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements that involve factors, risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors and risks include, but not limited to the followings: the Company’s goals and strategies; its future business development, financial condition and results of operations; the expected growth of the credit industry, and marketplace lending in particular, in China; the demand for and market acceptance of its marketplace’s products and services; its ability to attract and retain borrowers and investors on its marketplace; its relationships with its strategic cooperation partners; competition in its industry; and relevant government policies and regulations relating to the corporate structure, business and industry. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this announcement is current as of the date of this announcement, and the Company does not undertake any obligation to update such information, except as required under applicable law.

Use of Projections

This announcement also contains certain financial forecasts (or guidance) with respect to the Company’s projected financial results. The Company’s independent auditors have not audited, reviewed, compiled or performed any procedures with respect to the projections or guidance for the purpose of their inclusion in this announcement, and accordingly, they did not express an opinion or provide any other form assurance with respect thereto for the purpose of this announcement. This guidance should not be relied upon as being necessarily indicative of future results. The assumptions and estimates underlying the prospective financial information are inherently uncertain and are subject to a wide variety of significant business, economic and competitive risks and uncertainties that could actual results to differ materially from those contained in the prospective financial information. Accordingly, there can be no assurance that the prospective results are indicative of the future performance of the Company, or that actual results will not diff materially from those set forth in the prospective financial information. Inclusion of the prospective financial information in this announcement should not be regarded as a representation by any person that the results contained in the prospective financial information will actually be achieved. You should review this information together with the Company’s historical information.

For more information, please contact:

X Financial
Mr. Frank Fuya Zheng
E-mail: ir@xiaoying.com 

Christensen IR

In China
Mr. Rene Vanguestaine
Phone: +86-178-1749 0483
E-mail: rene.vanguestaine@christensencomms.com 

In US
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: linda.bergkamp@christensencomms.com

 

 

 

X Financial

Unaudited Condensed Consolidated Balance Sheets

(In thousands, except for share and per share data)

As of December 31, 2022

As of December 31, 2023

As of December 31, 2023

 RMB 

RMB

USD

 ASSETS 

 Cash and cash equivalents 

602,271

1,195,352

168,362

 Restricted cash 

404,689

749,070

105,504

 Accounts receivable and contract assets, net 

1,161,912

1,659,588

233,748

 Loans receivable from Xiaoying Credit Loans and other loans, net 

3,810,393

4,947,833

696,888

 Loans at fair value 

120,280

 Deposits to institutional cooperators, net 

1,770,317

1,702,472

239,788

 Prepaid expenses and other current assets, net 

71,082

48,767

6,870

 Deferred tax assets, net 

88,428

135,958

19,149

 Long-term investments 

495,995

493,411

69,495

 Property and equipment, net 

5,861

8,642

1,217

 Intangible assets, net 

36,550

36,810

5,185

 Loan receivable from Xiaoying Housing Loans, net 

10,061

8,657

1,219

 Financial investments 

192,620

608,198

85,663

 Other non-current assets 

67,204

55,265

7,784

 TOTAL ASSETS 

8,837,663

11,650,023

1,640,872

 LIABILITIES 

 Payable to investors and institutional funding partners at amortized cost 

2,627,910

3,584,041

504,802

 Payable to investors at fair value 

141,289

 Guarantee liabilities 

61,907

8,719

 Financial guarantee derivative 

107,890

 Short-term borrowings 

70,209

565,000

79,579

 Accrued payroll and welfare 

63,681

86,771

12,221

 Other tax payable 

255,691

289,819

40,819

 Income tax payable 

270,089

446,500

62,888

 Deposit payable to channel cooperators 

19,700

19,700

2,775

 Accrued expenses and other current liabilities 

476,035

622,324

87,653

 Dividend payable 

59,226

8,342

 Other non-current liabilities 

51,193

37,571

5,292

 Deferred tax liabilities 

722

30,040

4,231

 TOTAL LIABILITIES 

4,084,409

5,802,899

817,321

 Commitments and Contingencies 

 Equity: 

 Common shares 

207

207

29

 Treasury stock   

(124,597)

(111,520)

(15,707)

 Additional paid-in capital 

3,191,194

3,196,942

450,280

 Retained earnings 

1,622,851

2,692,018

379,163

 Other comprehensive income 

63,599

69,477

9,786

 Total X Financial shareholders’ equity 

4,753,254

5,847,124

823,551

 Non-controlling interests 

 TOTAL EQUITY 

4,753,254

5,847,124

823,551

 TOTAL LIABILITIES AND EQUITY 

8,837,663

11,650,023

1,640,872

 

 

 

X Financial

Unaudited Condensed Consolidated Statements of Comprehensive Income

 Three Months Ended December 31, 

 Twelve Months Ended December 31, 

(In thousands, except for share and per share data)

2022

2023

2023

2022

2023

2023

 RMB 

 RMB 

 USD 

 RMB 

 RMB 

 USD 

Net revenues

Loan facilitation service

562,137

615,482

86,689

2,044,344

2,740,974

386,058

Post-origination service

106,777

166,807

23,494

372,451

596,582

84,027

Financing income

248,639

307,692

43,338

966,277

1,137,336

160,190

Other revenue

38,087

102,683

14,463

179,878

339,992

47,887

Total net revenue

955,640

1,192,664

167,984

3,562,950

4,814,884

678,162

Operating costs and expenses:

Origination and servicing

588,730

755,238

106,373

2,126,742

2,869,845

404,209

General and administrative

42,445

48,142

6,781

171,524

186,515

26,270

Sales and marketing

2,497

3,711

523

15,448

12,539

1,766

(Reversal of) provision for accounts receivable and contract assets

(25,550)

6,250

880

21,836

12,234

1,723

Provision for loans receivable

75,396

99,365

13,995

158,576

229,137

32,273

(Reversal of) provision for contingent guarantee liabilities

25,926

3,652

(14,000)

67,520

9,510

(Reversal of) provision for credit losses on deposits to institutional cooperators

(1,831)

(246)

(35)

1,296

(674)

(95)

(Reversal of) provision for credit losses for other financial assets

86

12

(765)

86

12

Total operating costs and expenses

681,687

938,472

132,181

2,480,657

3,377,202

475,668

Income from operations

273,953

254,192

35,803

1,082,293

1,437,682

202,494

Interest income (expenses), net

396

(2,587)

(364)

3,756

(20,365)

(2,868)

Foreign exchange gain (loss)

6,175

3,232

455

(19,963)

(4,023)

(567)

Income (loss) from financial investments

28,702

1,686

237

20,900

(12,225)

(1,722)

Impairment losses on financial investments

(8,875)

Impairment losses on long-term investments

(26,866)

(46,771)

(6,588)

(26,866)

(46,771)

(6,588)

Fair value adjustments related to Consolidated Trusts

209

(6,168)

(531)

(75)

Change in fair value of financial guarantee derivative

91,380

137,654

24,966

3,516

Other income, net

8,590

1,346

190

40,724

24,351

3,430

Income before income taxes and gain (loss) from equity in affiliates

382,539

211,098

29,733

1,223,455

1,403,084

197,620

Income tax expense

(74,977)

(35,659)

(5,022)

(389,358)

(249,438)

(35,133)

Gain (loss) from equity in affiliates, net of tax

(32,923)

13,529

1,906

(22,102)

33,148

4,669

Net income

274,639

188,968

26,617

811,995

1,186,794

167,156

Less: net income attributable to non-controlling interests

Net income attributable to X Financial shareholders

274,639

188,968

26,617

811,995

1,186,794

167,156

Net income

274,639

188,968

26,617

811,995

1,186,794

167,156

Other comprehensive income, net of tax of nil:

Gain (loss) from equity in affiliates

39

(52)

(7)

204

(7)

(1)

Income (loss) from financial investments

475

67

475

67

Foreign currency translation adjustments

(12,887)

(8,214)

(1,157)

57,085

5,410

762

Comprehensive income

261,791

181,177

25,520

869,284

1,192,672

167,984

Less: comprehensive income attributable to non-controlling interests

Comprehensive income attributable to X Financial shareholders

261,791

181,177

25,520

869,284

1,192,672

167,984

Net income per share—basic

0.88

0.65

0.09

2.57

4.12

0.58

Net income per share—diluted 

0.86

0.64

0.09

2.52

4.08

0.57

Net income per ADS—basic

5.28

3.90

0.55

15.42

24.72

3.48

Net income per ADS—diluted 

5.16

3.84

0.54

15.12

24.48

3.45

Weighted average number of ordinary shares outstanding—basic

311,832,013

291,312,698

291,312,698

316,444,826

288,115,969

288,115,969

Weighted average number of ordinary shares outstanding—diluted

317,710,296

294,631,195

294,631,195

322,403,387

290,833,214

290,833,214

 

 

 

X Financial

Unaudited Reconciliations of GAAP and Non-GAAP Results

Three Months Ended December 31,

Twelve Months Ended December 31,

(In thousands, except for share and per share data)

2022

2023

2023

2022

2023

2023

RMB

RMB

USD

RMB

RMB

USD

GAAP net income

274,639

188,968

26,617

811,995

1,186,794

167,156

Less: Income (loss) from financial investments (net of tax of nil)

28,702

1,686

237

20,900

(12,225)

(1,722)

Less: Impairment losses on financial investments (net of tax of nil)

(8,875)

Less: Impairment losses on long-term investments (net of tax)

(20,150)

(35,079)

(4,941)

(20,150)

(35,079)

(4,941)

Add: Share-based compensation expenses (net of tax of nil)

11,852

8,421

1,186

53,538

42,598

6,000

Non-GAAP adjusted net income

277,939

230,782

32,507

873,658

1,276,696

179,819

Non-GAAP adjusted net income per share—basic

0.89

0.79

0.11

2.76

4.43

0.62

Non-GAAP adjusted net income per share—diluted 

0.87

0.78

0.11

2.71

4.39

0.62

Non-GAAP adjusted net income per ADS—basic

5.34

4.74

0.67

16.56

26.58

3.74

Non-GAAP adjusted net income per ADS—diluted 

5.22

4.68

0.66

16.26

26.34

3.71

Weighted average number of ordinary shares outstanding—basic

311,832,013

291,312,698

291,312,698

316,444,826

288,115,969

288,115,969

Weighted average number of ordinary shares outstanding—diluted

317,710,296

294,631,195

294,631,195

322,403,387

290,833,214

290,833,214

 

 

 

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