PINTEC Announces Third Quarter 2018 Unaudited Financial Results
Third Quarter 2018 Financial Highlights
- Total revenues were
RMB246.8 million (US$35.9 million ), an increase of 43.4% year-over-year fromRMB172.1 million in the same period of 2017.
- Gross profit increased by 120.8% year-over-year to
RMB125.8 million (US$18.3 million ). Gross margin expanded to 51.0% from 33.1% in the same period of 2017.
- Operating profit was
RMB24.0 million (US$3.5 million ) compared to an operating loss ofRMB9.8 million in the same period of 2017.
- Net income was
RMB3.4 million (US$0.5 million ) compared to a net loss ofRMB19.1 million in the same period of 2017.
- Adjusted net income1 was
RMB15.1 million (US$2.2 million ) compared to an adjusted net loss ofRMB11.3 million in the same period of 2017.
Third Quarter 2018 Operating Highlights
- Total loan originations in the third quarter of 2018 were
RMB2.7 billion (US$402.3 million ), representing a decrease of 34.1% from the same period of 2017.
- Loan outstanding balance was
RMB6.4 billion (US$961.4 million ) as ofSeptember 30, 2018 , representing an increase of 50.7% fromSeptember 30, 2017 .
- Delinquency
The following table provides delinquency rates for all loans facilitated by the Company as of the dates indicated:
Delinquent for | ||||||
16 ‑ 30 days | 31 ‑ 60 days | 61 ‑ 90 days | ||||
December 31, 2016 | 0.47 | % | 0.76 | % | 0.63 | % |
December 31, 2017 | 1.11 | % | 1.02 | % | 0.74 | % |
September 30, 2018 | 1.37 | % | 2.44 | % | 2.41 | % |
1 Adjusted net income is a non-GAAP financial measure, representing net income before share-based compensation expenses. For more information on non-GAAP financial measures, please see the section of "Use of Non-GAAP Financial Measures Statement" and the tables captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this release.
Mr.
Mr.
Third Quarter 2018 Financial Results
Total Revenues
Total revenues in the third quarter of 2018 increased by 43.4% year-over-year to
- Revenues from technical service fees increased by 31.7% to
RMB173.4 million (US$25.2 million ) in the third quarter of 2018 fromRMB131.6 million in the same period of 2017. The growth was primarily attributable to the significant increase in monthly service fees, which resulted from the growth in the outstanding balance of loans, in particular, personal installment loans.
- Revenues from installment service fees in the third quarter of 2018 increased by 81.0% to
RMB71.4 million (US$10.4 million ) fromRMB39.4 million in the same period of 2017. The growth was driven by an increase in the on-book installment loans volume with their improved fee arrangements, as well as a trend moving towards developing the installment loans with higher margins and longer terms.
- Revenues from wealth management service fees in the third quarter of 2018 increased by 100.6% to
RMB2.0 million (US$0.3 million ) fromRMB1.0 million in the same period of 2017. The increase was primarily attributable to the development and expansion of the wealth management services.
Cost of Revenues
Cost of revenues increased by 5.1% in the third quarter of 2018 to 120.9 million from 115.1 million in the same period last year. As a percentage of total revenues, cost of revenues decreased to 49.0% in the third quarter from 66.9% in the same period last year. The reduction was primarily due to a 32.8% decrease in the provision for credit losses to 28.1 million in the third quarter of 2018 from 41.7 million in the same period last year which was primarily due to the decrease of financing receivables.
Gross Profit
Gross profit in the third quarter of 2018 increased by 120.8% to
Operating Expenses
Total operating expenses in the third quarter were
- Sales and marketing expenses in the third quarter of 2018 decreased by 5.0% to
RMB18.4 million (US$2.7 million ) fromRMB19.4 million in the same period of 2017. As a percentage of total revenues, sales and marketing expenses decreased to 7.5% in the third quarter of 2018 from 11.3% in the same period of 2017. The decrease was primarily attributable to the Company’s optimized marketing process and improved marketing efficiency.
- General and administrative expenses in the third quarter of 2018 increased to
RMB63.0 million (US$9.2 million ) or 25.5% of total revenues, fromRMB28.3 million or 16.4% of total revenues in the same period of 2017. The increase was primarily due to the increase in bad debt expenses related to the growth of accounts receivable generated from uncollected technical service fees and the increase of accounts receivable with higher credit losses rates.
- Research and development expenses increased by 6.4% to
RMB20.4 million (US$3.0 million ) in the third quarter of 2018 fromRMB19.2 million in the same period of 2017. The increase was primarily due to the increased research and development headcount as the Company further enhanced its capabilities in big data and risk management technologies.
Operating Profit / Loss
Operating profit was
Net Income / Loss
Net income in the third quarter of 2018 was
Net loss attributable to ordinary shareholders in the third quarter of 2018 was
Balance Sheet
As of
As of
Conference Call Information
International: | +65-6713-5090 | |
United States Toll Free: | +1-866-519-4004 | |
China: | 400-620-8038 | |
Hong Kong Toll Free: | 800-906-601 | |
Conference ID: | 6694377 |
The replay will be accessible through
International: | +61-2-8199-0299 | |
United States Toll Free: | +1-855-452-5696 | |
Conference ID: | 6694377 |
A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.pintec.com/.
Use of Non-GAAP Financial Measures
In evaluating our business, the Company consider and use adjusted net income/loss as the supplemental measure to review and assess its operating performance. The presentation of the Non-GAAP financial measure is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S.GAAP. The Company define adjusted net income/loss as net income/loss excluding share-based compensation expenses.
The Company believes that this non-GAAP financial measure can help the management to evaluate the operating performance and formulate business plans. Adjusted net income/loss enables the management to assess the operating results without considering the impact of share-based compensation expenses. The Company also believes that this non-GAAP financial measure also provides useful information about its operating results, enhance the overall understanding of its past performance and future prospects and allow for greater visibility with respect to key metrics used by the management in their financial and operational decision-making.
The non-GAAP financial measure is not defined under U.S. GAAP and is not presented in accordance with U.S. GAAP. The non-GAAP financial measure has limitations as analytical tools. One of the key limitations of using adjusted net income/loss is that it doesn’t reflect all items of income and expenses that affect the Company’s operations. Share-based compensation expenses may continue to be incurred in the business, and are reflected in the presentation of adjusted net income/loss. Further, the non-GAAP financial measure may differ from the non-GAAP financial information used by other companies, including peer companies, and therefore their comparability may be limited.
The Company compensates for these limitations by reconciling the non-GAAP financial measure to the most directly comparable U.S. GAAP financial measures, all of which should be considered when evaluating the Company’s performance. The Company encourages you to review its financial information in its entirety and not rely on a single financial measure.
Exchange Rate
This announcement contains translations of certain RMB amounts into U.S. dollars (“USD”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of
Safe Harbor Statement
This 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. Among other things, [the Business Outlook and] quotations from management in this announcement, as well as PINTEC’s strategic and operational plans, contain forward-looking statements.
About
Investor Relations Contact
Phone: +1-646-308-1622
E-mail:ir@pintec.com
ICR Inc.
Phone: +1-646-308-1622
E-mail: pintec@icrinc.com
Pintec Technology Holdings Ltd. | |||||||||
Unaudited Condensed Consolidated Balance Sheets | |||||||||
As of | |||||||||
(In thousands, except for share and per share data) | December 31, 2017 |
September 30, 2018 |
|||||||
RMB | RMB | USD | |||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | 370,891 | 316,865 | 46,136 | ||||||
Restricted time deposits | 5,000 | 91,673 | 13,348 | ||||||
Short‑term investments | 2,000 | 1,659 | 242 | ||||||
Short‑term financing receivables, net | 1,506,179 | 883,437 | 128,631 | ||||||
Accrued interest receivable, net | 7,637 | 4,323 | 629 | ||||||
Accounts receivable, net | 36,556 | 55,694 | 8,109 | ||||||
Prepayments and other current assets | 68,903 | 265,833 | 38,706 | ||||||
Amounts due from related parties | 229,026 | 529,707 | 77,127 | ||||||
Total current assets | 2,226,192 | 2,149,191 | 312,928 | ||||||
Non-current assets: | |||||||||
Long‑term financing receivables, net | 178,627 | 81,553 | 11,874 | ||||||
Long‑term investments | 6,439 | 23,875 | 3,476 | ||||||
Property, equipment and software, net | 6,647 | 7,467 | 1,087 | ||||||
Intangible assets, net | 7,212 | 5,868 | 854 | ||||||
Goodwill | 25,680 | 25,680 | 3,739 | ||||||
Total non-current assets | 224,605 | 144,443 | 21,030 | ||||||
TOTAL ASSETS | 2,450,797 | 2,293,634 | 333,958 | ||||||
LIABILITIES | |||||||||
Current liabilities: | |||||||||
Short-term funding debts | 1,220,884 | 995,665 | 144,972 | ||||||
Accrued interest payable | 7,174 | 13,341 | 1,942 | ||||||
Accounts payable | 43,043 | 37,160 | 5,411 | ||||||
Amounts due to related parties | 375,369 | 223,712 | 32,573 | ||||||
Tax payable | 22,386 | 61,646 | 8,976 | ||||||
Convertible loans | 242,273 | - | - | ||||||
Guarantee liabilities | - | 15,765 | 2,295 | ||||||
Accrued expenses and other liabilities | 112,189 | 110,027 | 16,019 | ||||||
Total current liabilities | 2,023,318 | 1,457,316 | 212,188 | ||||||
Non-current liabilities: | |||||||||
Long-term funding debts | 469,733 | 63,502 | 9,246 | ||||||
Other non-current liabilities | 8,821 | 8,821 | 1,284 | ||||||
Long-term borrowings | - | 68,141 | 9,922 | ||||||
Amounts due to related parties | 11,120 | - | - | ||||||
Total non-current liabilities | 489,674 | 140,464 | 20,452 | ||||||
TOTAL LIABILITIES | 2,512,992 | 1,597,780 | 232,640 | ||||||
MEZZANINE EQUITY | |||||||||
Series Seed-A-1 convertible redeemable preferred shares | - | 2,577 | 374 | ||||||
Series Seed-A-2 convertible redeemable preferred shares | - | 23,226 | 3,382 | ||||||
Series Seed-B convertible redeemable preferred shares | - | 185,488 | 27,008 | ||||||
Series Seed-C convertible redeemable preferred shares | - | 525,108 | 76,457 | ||||||
Series A-1 convertible redeemable preferred shares | - | 276,449 | 40,252 | ||||||
Series A-2 convertible redeemable preferred shares | - | 415,433 | 60,488 | ||||||
TOTAL MEZZANINE EQUITY | - | 1,428,281 | 207,961 | ||||||
INVESTED DEFICIT/SHAREHOLDERS’ DEFICIT: | |||||||||
Parent company’s investment deficit | (62,195 | ) | - | - | |||||
Ordinary Shares | - | 59 | 9 | ||||||
Additional paid-in capital | - | 88,903 | 12,945 | ||||||
Accumulated other comprehensive income | - | 35,982 | 5,239 | ||||||
Accumulated deficit | - | (857,371 | ) | (124,836 | ) | ||||
TOTAL INVESTED DEFICIT/SHAREHOLDERS’ DEFICIT | (62,195 | ) | (732,427 | ) | (106,643 | ) | |||
TOTAL LIABILITIES, MEZZANINE EQUITY, INVESTED DEFICIT/SHAREHOLDERS’ DEFICIT | 2,450,797 | 2,293,634 | 333,958 |
Pintec Technology Holdings Ltd. | ||||||||||||
Unaudited Condensed Consolidated Statements of Operations and Comprehensive (loss)/income | ||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||
(In thousands, except for share and per share data) | September 30, 2017 | September 30, 2018 |
September 30, 2017 | September 30, 2018 |
||||||||
RMB | RMB | USD | RMB | RMB | USD | |||||||
Revenues: | ||||||||||||
Technical service fees | 131,623 | 173,360 | 25,242 | 269,884 | 573,063 | 83,439 | ||||||
Installment service fees | 39,447 | 71,382 | 10,393 | 73,811 | 241,263 | 35,129 | ||||||
Wealth management service fees | 1,003 | 2,012 | 293 | 2,425 | 10,092 | 1,469 | ||||||
Total revenues | 172,073 | 246,754 | 35,928 | 346,120 | 824,418 | 120,037 | ||||||
Cost of revenues: | ||||||||||||
Funding cost | (20,054 | ) | (32,017 | ) | (4,662 | ) | (45,608 | ) | (125,493 | ) | (18,272 | ) |
Provision for credit losses | (41,719 | ) | (28,050 | ) | (4,084 | ) | (67,789 | ) | (83,186 | ) | (12,112 | ) |
Origination and servicing cost | (53,326 | ) | (60,866 | ) | (8,862 | ) | (117,675 | ) | (253,774 | ) | (36,950 | ) |
Cost of revenues | (115,099 | ) | (120,933 | ) | (17,608 | ) | (231,072 | ) | (462,453 | ) | (67,334 | ) |
Gross profit | 56,974 | 125,821 | 18,320 | 115,048 | 361,965 | 52,703 | ||||||
Operating expenses: | ||||||||||||
Sales and marketing expenses | (19,375 | ) | (18,405 | ) | (2,680 | ) | (49,952 | ) | (69,669 | ) | (10,144 | ) |
General and administrative expenses | (28,262 | ) | (63,003 | ) | (9,173 | ) | (77,480 | ) | (159,591 | ) | (23,237 | ) |
Research and development expenses | (19,175 | ) | (20,404 | ) | (2,971 | ) | (52,847 | ) | (59,466 | ) | (8,658 | ) |
Total operating expenses | (66,812 | ) | (101,812 | ) | (14,824 | ) | (180,279 | ) | (288,726 | ) | (42,039 | ) |
Operating (loss)/profit | (9,838 | ) | 24,009 | 3,496 | (65,231 | ) | 73,239 | 10,664 | ||||
Change in fair value of convertible loans | - | - | - | - | (9,553 | ) | (1,391 | ) | ||||
Share of loss from equity method investments | - | (1,324 | ) | (193 | ) | - | (2,049 | ) | (298 | ) | ||
Other (loss)/income, net | (379 | ) | 1,061 | 154 | (1,451 | ) | 3,890 | 566 | ||||
Gain on guarantee liabilities | - | 7,862 | 1,145 | - | 10,135 | 1,476 | ||||||
(Loss)/income before income tax expense | (10,217 | ) | 31,608 | 4,602 | (66,682 | ) | 75,662 | 11,017 | ||||
Income tax expense | (8,835 | ) | (28,236 | ) | (4,110 | ) | (8,841 | ) | (59,902 | ) | (8,723 | ) |
Net (loss)/income | (19,052 | ) | 3,372 | 492 | (75,523 | ) | 15,760 | 2,294 | ||||
Pre-IPO Preferred shares redemption value accretion | (11,285 | ) | (34,200 | ) | (4,980 | ) | (34,317 | ) | (67,377 | ) | (9,810 | ) |
Net loss attributable to ordinary share holders | (30,337 | ) | (30,828 | ) | (4,488 | ) | (109,840 | ) | (51,617 | ) | (7,516 | ) |
Net (loss)/income | (19,052 | ) | 3,372 | 492 | (75,523 | ) | 15,760 | 2,294 | ||||
Other comprehensive income: | ||||||||||||
Foreign currency translation adjustments net of nil tax | 84 | 16,794 | 2,445 | 111 | 35,142 | 5,117 | ||||||
Total other comprehensive income | 84 | 16,794 | 2,445 | 111 | 35,142 | 5,117 | ||||||
Total comprehensive (loss)/income | (18,968 | ) | 20,166 | 2,937 | (75,412 | ) | 50,902 | 7,411 | ||||
Pre-IPO Preferred shares redemption value accretion | (11,285 | ) | (34,200 | ) | (4,980 | ) | (34,317 | ) | (67,377 | ) | (9,810 | ) |
Comprehensive loss attributable to ordinary shareholders | (30,253 | ) | (14,034 | ) | (2,043 | ) | (109,729 | ) | (16,475 | ) | (2,399 | ) |
Pro forma net loss per ordinary share(1) | ||||||||||||
Basic | (0.48 | ) | (0.45 | ) | (0.07 | ) | (1.77 | ) | (0.76 | ) | (0.11 | ) |
Diluted | (0.48 | ) | (0.45 | ) | (0.07 | ) | (1.77 | ) | (0.76 | ) | (0.11 | ) |
Pro forma weighted average ordinary shares outstanding(1) | ||||||||||||
Basic | 63,507,546 | 68,602,327 | 68,602,327 | 62,114,691 | 67,498,718 | 67,498,718 | ||||||
Diluted | 63,507,546 | 68,602,327 | 68,602,327 | 62,114,691 | 67,498,718 | 67,498,718 |
- The Company issued ordinary shares to
Jimu Parent ordinary shareholders in connection with the Reorganization inMarch 2018 . Basic and diluted net loss per ordinary share for the three months endedSeptember 30, 2017 and nine months endedSeptember 30, 2017 respectively, reflecting the effect of the issuance of ordinary shares toJimu Parent ordinary shareholders are presented as if they had been existed sinceJanuary 1, 2016 .
Pintec Technology Holdings Ltd. | ||||||||||||
Unaudited Reconciliations of GAAP and Non-GAAP Results | ||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||
(In thousands, except for share and per share data) | September 30, 2017 | September 30, 2018 |
September 30, 2017 | September 30, 2018 |
||||||||
RMB | RMB | USD | RMB | RMB | USD | |||||||
Net (loss)/income | (19,052 | ) | 3,372 | 492 | (75,523 | ) | 15,760 | 2,294 | ||||
Add: Share-based compensation expenses | 7,787 | 11,681 | 1,701 | 23,245 | 29,801 | 4,339 | ||||||
Adjusted net (loss)/income | (11,265 | ) | 15,053 | 2,193 | (52,278 | ) | 45,561 | 6,633 | ||||
Net loss attributable to ordinary shareholders | (30,337 | ) | (30,828 | ) | (4,488 | ) | (109,840 | ) | (51,617 | ) | (7,516 | ) |
Add: Share-based compensation expenses | 7,787 | 11,681 | 1,701 | 23,245 | 29,801 | 4,339 | ||||||
Adjusted net loss per ordinary share | (22,550 | ) | (19,147 | ) | (2,787 | ) | (86,595 | ) | (21,816 | ) | (3,177 | ) |
Basic | (0.36 | ) | (0.28 | ) | (0.04 | ) | (1.39 | ) | (0.32 | ) | (0.05 | ) |
Diluted | (0.36 | ) | (0.28 | ) | (0.04 | ) | (1.39 | ) | (0.32 | ) | (0.05 | ) |
Weighted average number of ordinary shares outstanding | ||||||||||||
Basic | 63,507,546 | 68,602,327 | 68,602,327 | 62,114,691 | 67,498,718 | 67,498,718 | ||||||
Diluted | 63,507,546 | 68,602,327 | 68,602,327 | 62,114,691 | 67,498,718 | 67,498,718 |
Source: Pintec Technology Holdings Limited