Jiayin Group Inc. Reports Third Quarter 2020 Unaudited Financial Results

Monday, 30. November 2020 12:20

--Completed transformation to 100% institutional funding--
--Eliminated outstanding loan balance of legacy P2P lending business--

SHANGHAI, China, Nov. 30, 2020 (GLOBE NEWSWIRE) -- Jiayin Group Inc. (“Jiayin” or the “Company”) (NASDAQ: JFIN), a leading fintech platform in China, today announced its unaudited financial results for the third quarter ended September 30, 2020.

Third Quarter 2020 Operational and Financial Highlights :

  • Loan origination volume1 was RMB3,330 million (US$490.5 million), representing a decrease of 29.4% from the same period of 2019, and an increase of 48.8% sequentially.

  • Average borrowing amount per borrower was RMB6,556 (US$965.6), representing a decrease of 12.0% from the same period of 2019.

  • Repeat borrowing rate2 was 74.5%, compared with repeat borrowing rate of 52.7% in the same period of 2019.

  • Institutional funding accounted for 100% of the total loans facilitated, compared with 8.2% in the same period of 2019.

  • Net revenue was RMB401.3 million (US$59.1 million), representing a decrease of 21.4% from the same period of 2019, and an increase of 63.8% sequentially.

  • Operating income was RMB150.0 million (US$22.1 million), representing an increase of 79.6% from the same period of 2019, and an increase of 212.5% sequentially.

  • Net income was RMB88.4 million (US$13.0 million), representing an increase of 8.1% from the same period of 2019, and an increase of 115.1% sequentially.

Mr. Yan Dinggui, the Founder, Director and Chief Executive Officer, commented: “I am excited to report another solid quarter of strong business performance. Most notably, we completed the business transition upon which we embarked at the start of the year. I am proud to announce that as of November 10, 2020, the outstanding loan balance of our legacy P2P lending business was reduced to zero! This marks a significant milestone. Jiayin has successfully transformed to a finance technology company fully funded only by institutions.  Considering that at this time one year ago, our platform funding was over 90% from individuals, this rapid transition demonstrates our agility and outstanding execution capability.”

Yan added, “In addition to successfully completing our funding transition, we continued to deliver encouraging business results despite the challenging environment. The loans we facilitated performed very well, investor confidence remained strong, we improved operating efficiency, and we maintained attractive profitability. In the quarter, our net income reached RMB88.4 million, up 8.1% year over year and 115.1% sequentially. This remarkable improvement demonstrates both the effectiveness of our growth strategy and our strong execution. Jiayin always strives to operate conservatively but profitably. We believe that our strong underlying business and brand recognition will enable us to achieve robust growth for the coming years.”

Third Quarter 2020 Financial Results

Net revenue was RMB401.3 million (US$59.1 million), representing a decrease of 21.4% from the same period of 2019.

Revenue from loan facilitation services was RMB290.6 million (US$42.8 million), representing a decrease of 26.7% from the same period of 2019. The decrease was primarily due to the lower loan origination volume and the shift to institutional funding partners.

Revenue from post-origination services was RMB33.7 million (US$5.0 million), representing a decrease of 43.2% from the same period of 2019. The decrease was due to the lower outstanding loan balance.

Other revenue was RMB77.0 million (US11.3 million), representing an increase of 40.0% from the same period of 2019. The increase was primarily due to the variable consideration related to automated investment program recognized from loans previously facilitated under the P2P business.

Origination and servicing expenses were RMB59.5 million (US$8.8 million), representing a decrease of 41.1% from the same period of 2019, primarily due to the lower volume of loans facilitated by the Company and reduced collection costs as the company no longer provides such services under its new business model.

Allowance for uncollectable receivables, contract assets and loan receivables was RMB15.8 million (US$2.3 million), representing a decrease of 76.7% from the same period of 2019, primarily due to the the overall decrease of facilitation volume, as well as the relatively lower credit risk of the new business model.

Sales and marketing expenses were RMB99.5 million (US$14.7 million), representing a decrease of 34.7% from the same period of 2019, primarily due to the lower customer acquisition expenses and reduced advertising spending for promotional activities.

General and administrative expenses were RMB37.3 million (US$5.5 million), representing a decrease of 21.5% from the same period of 2019, primarily due to the decrease in share-based compensation expense and the decrease in salaries and personnel related costs, as well as other business-related expenses.

Research and development expenses were RMB39.2 million (US$5.8 million), representing a decrease of 33.1% from the same period of 2019, primarily due to the decrease in share-based compensation expense and a more streamlined team in the technology and development department resulting from the business transition.

Income from operations was RMB150.0 million (US$22.1 million), representing an increase of 79.6% from the same period of 2019, and an increase of 212.5% sequentially.

Other income (expense), net was a net loss of RMB32.8 million (US$4.8 million), compared with a net gain of RMB7.3 million for the corresponding period in 2019. The loss in this quarter was primarily due to the estimated loss of short-term investments.

Net income was RMB88.4 million (US$13.0 million), representing an increase of 8.1% from the same period of 2019, and an increase of 115.1% sequentially.

Cash and cash equivalents were RMB94.8 million (US$14.0 million) as of September 30, 2020, compared with RMB69.9 million as of June 30, 2020.

Conference Call

The Company will host a conference call to discuss its financial results on Monday, November 30, 2020 at 8:00 a.m. US. Eastern Time (9:00 PM Beijing/Hong Kong Time).

Please register in advance to join the conference using the link provided below and dial in 10 minutes before the call is scheduled to begin. Conference access information will be provided upon registration.

Participant Online Registration: http://apac.directeventreg.com/registration/event/5890747

A replay of the conference call may be accessed by phone at the following numbers until December 8, 2020. To access the replay, please reference the conference ID 5890747.

 Phone NumberToll-Free Number
United States+1 (646) 254-3697+1 (855) 452-5696
Hong Kong+852 30512780+852 800963117
Mainland China +86 4006322162
+86 8008700205

A live and archived webcast of the conference call will be available on the company’s investors relations website at http://ir.jiayin-fintech.com/.

About Jiayin Group Inc.

Jiayin Group Inc. is a leading fintech platform in China committed to facilitating effective, transparent, secure and fast connections between investors and borrowers, whose needs are underserved by traditional financial institutions. The origin of the business of the Company can be traced back to 2011. The Company operates a highly secure and open platform with a comprehensive risk management system and a proprietary and effective risk assessment model which employs advanced big data analytics and sophisticated algorithms to accurately assess the risk profiles of potential borrowers.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at a 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 RMB6.7896 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of September 30, 2020. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

Safe Harbor / Forward-Looking Statements

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the United States 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” and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to 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. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and the industry. Potential risks and uncertainties include, but are not limited to, those relating to the Company’s ability to retain existing investors and borrowers and attract new investors and borrowers in an effective and cost-efficient way, the Company’s ability to increase the investment volume and loan origination of loans volume facilitated through its marketplace, effectiveness of the Company’s credit assessment model and risk management system, PRC laws and regulations relating to the online individual finance industry in China, general economic conditions in China, and the Company’s ability to meet the standards necessary to maintain listing of its ADSs on the Nasdaq Stock Market or other stock exchange, including its ability to cure any non-compliance with the continued listing criteria of the Nasdaq Stock Market. All information provided in this press release is as of the date hereof, and the Company undertakes no obligation to update any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results. Further information regarding risks and uncertainties faced by the Company is included in the Company’s filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F.

For more information, please contact:

In China:

Jiayin Group
Ms. Shelley Bai
Email: ir@jiayinfintech.cn

or

The Blueshirt Group
Ms. Susie Wang
Email: susie@blueshirtgroup.com

In the U.S.:

Ms. Julia Qian
Email: julia@blueshirtgroup.com


 
JIAYIN GROUP INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except for share and per share data)
 
  As of
December 31,
  As of September 30, 
  2019  2020 
  RMB  RMB  US$ 
ASSETS            
Cash and cash equivalents  122,149   94,826   13,966 
Restricted cash     2,000   295 
Amounts due from related parties3  130,722   5,604   825 
Accounts receivable, net3  139,164   116,227   17,118 
Loan receivables, net3     17,965   2,646 
Short-term investment3  69,618   33,698   4,963 
Prepaid expenses and other current assets  91,002   56,546   8,328 
Deferred tax assets  68,292   68,292   10,058 
Property and equipment  39,084   24,488   3,607 
Right-of-use assets  37,215   13,152   1,937 
Long-term investment  3,826   99,640   14,675 
TOTAL ASSETS  701,072   532,438   78,418 
LIABILITIES AND EQUITY            
Payroll and welfare payable  48,524   39,948   5,884 
Amounts due to related parties  872   12,753   1,878 
Refund liabilities  180,104   13,071   1,925 
Tax payables  179,421   248,070   36,537 
Accrued expenses and other current liabilities  158,705   81,681   12,030 
Other payable related to the disposal of Shanghai Caiyin  839,830   680,683   100,254 
Lease liabilities  35,215   11,101   1,635 
TOTAL LIABILITIES  1,442,671   1,087,307   160,143 
SHAREHOLDERS' DEFICIT            
Class A ordinary shares (US$ 0.000000005 par value;
   100,100,000 shares issued and outstanding as of
   December 31, 2019 and September 30, 2020)4
  0   0   0 
Class B ordinary shares (US$ 0.000000005 par value;
   116,000,000 shares issued and outstanding as of
   December 31, 2019 and September 30, 2020)4
  0   0   0 
Additional paid-in capital  777,408   799,602   117,769 
Accumulated deficit  (1,519,731)  (1,352,471)  (199,197)
Other comprehensive income  469   (4,385)  (647)
Total Jiayin Group shareholder's deficit  (741,854)  (557,254)  (82,075)
Non-controlling interests  255   2,385   350 
TOTAL SHAREHOLDERS' DEFICIT  (741,599)  (554,869)  (81,725)
TOTAL LIABILITIES AND DEFICIT  701,072   532,438   78,418 
             


 
JIAYIN GROUP INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Amounts in thousands, except for share and per share data)
 
  For the Three Months Ended
September 30,
  For the Nine Months Ended
September 30,
 
  2019  2020  2019  2020 
  RMB  RMB  US$  RMB  RMB  US$ 
Net revenue (including revenue from related
  parties of RMB 654 and RMB
993 for 2019Q3
  and 2020Q3, respectively)
  510,773   401,310   59,107   1,887,556   959,825   141,367 
Operating cost and expenses:                        
Origination and servicing  (101,128)  (59,478)  (8,760)  (354,929)  (174,341)  (25,678)
Allowance for uncollectible accounts receivable,
  contract assets and loan receivables
  (67,780)  (15,845)  (2,334)  (182,325)  (56,971)  (8,391)
Sales and marketing  (152,364)  (99,500)  (14,655)  (492,336)  (257,584)  (37,938)
General and administrative  (47,465)  (37,273)  (5,490)  (154,405)  (112,099)  (16,510)
Research and development  (58,566)  (39,200)  (5,774)  (162,785)  (109,674)  (16,153)
Total operating cost and expenses  (427,303)  (251,296)  (37,013 )  (1,346,780)  (710,669)  (104,670)
Income from operation  83,470   150,014   22,094   540,776   249,156   36,697 
Interest income (expense)  88   2,488   366   (88)  7,727   1,138 
Other income (expense), net  7,308   (32,763)  (4,825)  20,876   (28,611)  (4,214)
Income before income taxes and income
  from investment in affiliates
  90,866   119,739   17,635   561,564   228,272   33,621 
Income tax expense  (9,099)  (32,128)  (4,732)  (79,623)  (60,070)  (8,847)
Income from investment in affiliates     740   109      713   105 
Net income  81,767   88,351   13,012   481,941   168,915   24,879 
Less: net income (loss) attributable to
  non-controlling interest shareholders
  152   2,209   324   (76)  1,655   244 
Net income attributable to Jiayin Group Inc.  81,615   86,142   12,688   482,017   167,260   24,635 
Weighted average shares used in
  calculating 
net income per share:
                        
- Basic and diluted  216,100,000   216,100,000   216,100,000   206,307,671   216,100,000   216,100,000 
Net income per share:                        
- Basic and diluted  0.38   0.40   0.06   2.34   0.77   0.11 
Other comprehensive income, net of
  tax of nil:
                        
Foreign currency translation adjustments  10,769   (8,449)  (1,243)  10,777   (4,878)  (719)
Comprehensive income  92,536   79,902   11,769   492,718   164,037   24,160 
Comprehensive income (loss) attributable to
  non-controlling interest
  151   2,151   317   (76)  1,631   240 
Total comprehensive income attributable to
  Jiayin Group Inc.
  92,385   77,751   11,452   492,794   162,406   23,920 
                         


_____________________

1 “Loan origination volume” refers to the total amount of loans facilitated in Mainland China during the period presented.
2 “Repeat borrowing rate” refers to the repeat borrowers as a percentage of all of our borrowers in Mainland China.
3 The Company has adopted “ASC 326, Financial Instruments — Credit Losses” beginning January 1, 2020 . As of now, the adoption of the new guidance did not have material impacts on the Company’s results of operations, financial condition or liquidity.
4 The total shares authorized for both Class A and Class B are 10,000,000,000,000.


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