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First Quarter 2019 Operational Highlights:
- Total outstanding principal balance of loans1 reached
RMB35.0 billionas of March 31, 2019, representing an increase of 64.7% from RMB21.3 billionas of March 31, 2018.
- Total loan originations1 in the first quarter of 2019 reached
RMB20.1 billion, an increase of 35.6% from RMB14.8 billionin the first quarter of 2018.
- The GMV2 of our e-commerce channel amounted to
RMB1.7 billion, representing an increase of 41.8% from RMB1.2 billionin the first quarter of 2018.
- The weighted average tenor of loans originated on our platform in the first quarter of 2019 was approximately 12.5 months. The weighted average APR3 was 26.2% for the first quarter of 2019.
- Total number of registered users reached 42.2 million as of
March 31, 2019, representing an increase of 59.6% from 26.4 million as of March 31, 2018; and users with credit line reached 11.6 million as of March 31, 2019, up by 41.6% from 8.2 million as of March 31, 2018.
- Number of active users4 in the first quarter of 2019 reached 3.2 million, representing an increase of 22.4% from 2.6 million in the first quarter of 2018. Number of new active users in the first quarter of 2019 was 705 thousand, representing an increase of 59.6% from 441 thousand in the first quarter of 2018.
- 90 day+ delinquency ratio5 was 1.42% as of
March 31, 2019.
1Outstanding principal balance and originations of loans represent the outstanding principal balance and originations of both on- and off-balance sheet loans.
2 GMV refers to the total value of transactions completed for products or services purchased on the e-commerce channel of our platform, net of returns.
3 APR is the annualized percentage rate of all-in interest costs and fees to the borrower over the net proceeds received by the borrower. Weighted average APR is weighted by loan origination amount for each loan originated in the period.
4Active users refer to, for a specified period, users who made at least one transaction during that period through our platform or through our third-party partners’ platforms using credit line granted by us.
5 90 day+ delinquency ratio refers to outstanding principal balance of on- and off-balance sheet loans that were 90 to 179 calendar days past due as a percentage of the total outstanding principal balance of on- and off-balance sheet loans on our platform as of a specific date. Loans that are charged off are not included in the delinquency rate calculation.
First Quarter 2019 Financial Highlights:
- Total operating revenue reached
RMB2.0 billion. Financial services income reached RMB1.3 billion, representing an increase of 23.9% from the first quarter of 2018. Loan facilitation and servicing fees reached RMB911 million, representing an increase of 342% from the first quarter of 2018.
- Gross profit reached
RMB907 million, representing an increase of 101% from the first quarter of 2018.
- Net income was
RMB583 million, representing an increase of 228% from the first quarter of 2018.
- Non-GAAP EBIT6 was
RMB742 million, representing an increase of 197% from the first quarter of 2018.
- Adjusted net income6 was
RMB622 million, representing an increase of 203% from the first quarter of 2018. Adjusted net income per ADS6 was RMB3.44on a fully diluted basis.
6Non-GAAP EBIT, adjusted net income, adjusted net income per ordinary share and per ADS are non-GAAP financial measures. 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 press release.
“I am excited to report another quarter of strong performance, which has been driven by our three key advantages of diversified funding sources, financial technology, and consumption scenarios,” said Mr.
“We continue to see strong year-on-year growth in our business in the first quarter,” said Mr.
“Credit performance and credit quality continues to be strong,” said Mr. Ryan Huanian Liu, Lexin’s chief risk officer. “Our vintage charge-off rate7 is just over 2.0%, and our 90 day+ delinquency rate was 1.42% as of
7 Vintage charge-off rate refers to, with respect to on- and off-balance sheet loans originated during a specified time period, which we refer to as a vintage, the total outstanding principal balance of the loans that are charged off during a specified period, divided by the total initial principal of the loans originated in such vintage.
First Quarter 2019 Financial Results:
Operating revenue increased from
Financial services income increased by 23.9% from
Loan facilitation and servicing fees increased by 342% from
Interest and financial services income decreased by 55.2% from
Funding cost decreased by 44.6% from
Processing and servicing cost increased by 77.0% from
Provision for credit losses of financing receivables decreased by 46.8% from
Gross profit increased by 101% from
Sales and marketing expenses increased by 92.3% from
Research and development expenses increased by 37.8% from
General and administrative expenses increased by 48.7% from
Gain on guarantee liabilities, net for the first quarter of 2019 was
Change in fair value of financial guarantee derivatives, net for the first quarter of 2018 was a loss of
Income tax expense for the first quarter of 2019 was
Net income for the first quarter of 2019 was
Adjusted net income for the first quarter of 2019 was
Please click here to view our vintage curve:
Based on Lexin’s preliminary assessment of the current market conditions, the Company continues to expect total loan originations for the fiscal year 2019 to be approximately
The Company’s management will host an earnings conference call at
Dial-in details for the earnings conference call are as follows:
|United States:||1 845 675 0437 or 1 866 519 4004|
|International:||65 6713 5090|
|Hong Kong:||800 906 601 or 852 3018 6771|
|China:||400 6208 038 or 800 8190 121|
|Participants should dial-in at least 5 minutes before the scheduled start time and use the following passcode:|
Additionally, a live and archived webcast of the conference call will be available on the Company’s investor relations website at http://ir.lexin.com.
A replay of the conference call will be accessible approximately two hours after the conclusion of the live call until
|United States:||1 855 452 5696 or 1 646 254 3697|
|International:||61 2 8199 0299|
|Replay Access Code:||8899945|
For more information, please visit http://ir.lexin.com
To follow us on Twitter, please go to: https://twitter.com/LexinFintech.
Use of Non-GAAP Financial Measures Statement
In evaluating our business, we consider and use adjusted net income and non-GAAP EBIT, two non-GAAP measures, as supplemental measures to review and assess our operating performance. The presentation of the non-GAAP financial measures 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. We define adjusted net income as net income excluding share-based compensation expenses and non-GAAP EBIT as net income excluding income tax expense, share-based compensation expenses, and interest expense, net.
We present these non-GAAP financial measures because it is used by our management to evaluate our operating performance and formulate business plans. Adjusted net income enables our management to assess our operating results without considering the impact of share-based compensation expenses. Non-GAAP EBIT, on the other hand, enables our management to assess our operating results without considering the impact of income tax expense, share-based compensation expenses, and interest expense, net. We also believe that the use of these non-GAAP financial measures facilitate investors’ assessment of our operating performance. These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP.
These non-GAAP financial measures have limitations as an analytical tool. One of the key limitations of using adjusted net income and non-GAAP EBIT is that they do not reflect all items of income and expense that affect our operations. Share-based compensation expenses, income tax expense, and interest expense, net have been and may continue to be incurred in our business and are not reflected in the presentation of adjusted net income and non-GAAP EBIT. Further, these non-GAAP financial measures may differ from the non-GAAP financial information used by other companies, including peer companies, and therefore their comparability may be limited.
We compensate for these limitations by reconciling the non-GAAP financial measure to the most directly comparable U.S. GAAP financial measure, 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.
Exchange Rate Information Statement
This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the rate of
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about Lexin’s beliefs and expectations, are forward-looking statements. These forward-looking statements can be identified by terminology such as “will,” expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “confident” and similar statements. Among other things, the expectation of its collection efficiency and delinquency, business outlook and quotations from management in this announcement, contain forward-looking statements. Lexin may also make written or oral forward-looking statements in its periodic reports to the
For investor and media inquiries, please contact:
Tel: +86 (755) 3637-8888 ext. 6258
Tel: +86 (755) 3637-8888 ext. 6993
Unaudited Condensed Consolidated Balance Sheets
|(In thousands, except for share and per share data)||As of
|December 31, 2018||March 31, 2019|
|Cash and cash equivalents||1,148,292||1,341,417||199,877|
|Restricted time deposits||344,212||210,000||31,291|
|Short‑term financing receivables, net||5,140,634||4,027,899||600,176|
|Accrued interest receivable||82,943||66,465||9,904|
|Prepaid expenses and other current assets||923,827||1,007,286||150,090|
|Amounts due from related parties||-||2,230||332|
|Risk safeguard fund receivable, net||395,025||514,954||76,731|
|Contract assets and service fees receivable, net||946,293||1,142,136||170,184|
|Total current assets||10,304,958||9,922,603||1,478,515|
|Long‑term financing receivables, net||1,283,036||1,019,810||151,956|
|Risk safeguard fund receivable, net||116,208||139,977||20,857|
|Contract assets and service fees receivable, net||291,784||284,517||42,394|
|Property, equipment and software, net||82,420||92,569||13,793|
|Deferred tax assets||94,598||99,371||14,807|
|Total non‑current assets||2,165,617||2,083,624||310,469|
|Amounts due to related parties||14,569||8,829||1,316|
|Short‑term funding debts||4,646,041||3,752,367||559,120|
|Accrued interest payable||182,280||117,808||17,554|
|Risk safeguard fund payable||456,276||546,998||81,505|
|Accrued expenses and other current liabilities*||2,145,689||2,055,698||306,309|
|Total current liabilities||8,018,713||6,856,428||1,021,641|
|Long‑term funding debts||157,887||210,894||31,424|
|Deferred tax liabilities||187,183||167,071||24,894|
|Other long-term liabilities*||-||52,188||7,776|
|Total non‑current liabilities||345,070||430,153||64,094|
|Class A Ordinary Shares||160||164||24|
|Class B Ordinary Shares||66||64||10|
|Additional paid‑in capital||2,328,716||2,368,123||352,861|
|Accumulated other comprehensive loss||(14,308||)||(23,847||)||(3,553||)|
|TOTAL SHAREHOLDERS’ EQUITY||4,106,792||4,719,646||703,249|
|TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY||12,470,575||12,006,227||1,788,984|
* The Company has adopted Accounting Standards Update No. 2016-02, Leases, beginning January 1, 2019 on a modified retrospective basis. As a result, the Company recognized approximately RMB100 million of right-of-use assets recorded in other assets, and corresponding short-term leasing liabilities recorded in accrued expenses and other current liabilities and long-term leasing liabilities recorded in other long-term liabilities respectively on the consolidated balance sheet as of March 31, 2019. The Company elected not to recognize lease assets and liabilities for leases with a term of 12 months or less. The adoption had no impact on the Company’s consolidated statements of operations for the quarter ended March 31, 2019 or the opening balances of retained earnings as of January 1, 2019.
Unaudited Condensed Consolidated Statement of Operations
|(In thousands, except for share and per share data)||For the Three Months Ended March 31,
|Online direct sales||542,899||624,909||93,114|
|Services and others||30,094||54,699||8,150|
|Online direct sales and services income||572,993||679,608||101,264|
|Interest and financial services income||784,381||351,290||52,344|
|Loan facilitation and servicing fees||206,042||910,562||135,678|
|Financial services income||1,040,725||1,289,798||192,186|
|Total operating revenue||1,613,718||1,969,406||293,450|
|Cost of sales||(548,723||)||(628,002||)||(93,575||)|
|Processing and servicing cost||(65,934||)||(116,719||)||(17,392||)|
|Provision for credit losses of financing receivables||(286,791||)||(152,517||)||(22,726||)|
|Provision for credit losses of contract assets and service fees receivable||(3,623||)||(22,461||)||(3,347||)|
|Total operating cost||(1,162,097||)||(1,061,971||)||(158,239||)|
|Sales and marketing expenses||(101,510||)||(195,183||)||(29,083||)|
|Research and development expenses||(68,093||)||(93,848||)||(13,984||)|
|General and administrative expenses||(58,641||)||(87,210||)||(12,995||)|
|Total operating expenses||(228,244||)||(376,241||)||(56,062||)|
|Gain on guarantee liabilities, net||-||103,677||15,448|
|Interest expense, net||(3,639||)||(2,458||)||(366||)|
|Change in fair value of financial guarantee derivatives, net||(8,075||)||50,496||7,524|
|Income before income tax expense||219,288||700,519||104,379|
|Income tax expense||(41,428||)||(117,535||)||(17,513||)|
|Net income per ordinary share|
|Net income per ADS|
|Weighted average number of ordinary shares outstanding|
Unaudited Condensed Consolidated Statements of Comprehensive Income
|(In thousands, except for share and per share data)||For the ThreeMonths Ended March 31,
|Other comprehensive loss|
|Foreign currency translation adjustments, net of nil tax||(43,249||)||(9,539||)||(1,421||)|
|Total comprehensive income||134,611||573,445||85,445|
Unaudited Reconciliations of GAAP and Non-GAAP Results
|(In thousands)||For the Three Months Ended March 31,
|Reconciliation of Adjusted Net Income to Net Income|
|Add: Share-based compensation expenses||27,311||39,407||5,872|
|Adjusted net income||205,171||622,391||92,738|
|Adjusted net income per ordinary share|
|Adjusted net income per ADS|
|Weighted average number of ordinary shares outstanding|
Unaudited Reconciliations of GAAP and Non-GAAP Results
|(In thousands)||For the Three Months Ended March 31,|
|Reconciliations of Non-GAAP EBIT to Net Income|
|Add: Income tax expense||41,428||117,535||17,513|
|Share-based compensation expenses||27,311||39,407||5,872|
|Interest expense, net||3,639||2,458||366|
Source: LexinFintech Holdings Ltd.