6-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of November 2022

Commission File Number: 001-38328

 

LexinFintech Holdings Ltd.

 

27/F CES Tower

No. 3099 Keyuan South Road

Nanshan District, Shenzhen 518057

The People's Republic of China

(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ___X____ Form 40-F _________

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):________________

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):________________

 

 


 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

LexinFintech Holdings Ltd.

 

By

 

/s/ Sunny Rui Sun

Name:

 

Sunny Rui Sun

Title:

 

Chief Financial Officer

 

Date: November 17, 2022

 

 

 


 

Exhibit Index

Exhibit 99.1—Press Release

 

 


EX-99.1

 

Exhibit 99.1

LexinFintech Holdings Ltd. Reports Third Quarter 2022

Unaudited Financial Results

SHENZHEN, China, November 16, 2022 (GLOBE NEWSWIRE) -- LexinFintech Holdings Ltd. (“Lexin” or the “Company”) (NASDAQ: LX), a leading online and offline consumption platform and a technology-driven service provider in China, today announced its unaudited financial results for the quarter ended September 30, 2022.

“In the third quarter, our total loan originations reached approximately RMB56.2 billion, surpassing our original expectation of RMB53 billion. Other key financial, operational and overall risk level metrics were well on the track of a gradual trajectory of recovery quarter over quarter this year”, said Jay Wenjie Xiao, Lexin's chairman and chief executive officer. “Looking to the future from our current position, we will continue to invest in further tamping of our competencies in data analyzing and technology innovation, to strengthen our other core capabilities down to every detail of our daily operations, risk control and further expand our cooperation with our financial institution partners, and in turn, to further revitalize the Lexin eco-system. We remain focused on the pursuit of prudent and sustainable development in preparation for any potential uncertainties.”


 

“Our third quarter financial results demonstrated a positive and upward momentum for the fiscal year 2022, supported by our determined efforts in improving asset quality and operational efficiency. On a quarter-over-quarter basis, our operating revenue delivered a 11.5% growth, while net income increased by 64.6%.” said Ms. Sunny Rui Sun, Lexin’s chief financial officer. “Looking ahead, along with our sustained investment in digitalization and technology, we will emphasize on achieving reasonable and sustainable profitability, while maintaining quality topline growth.”

Third Quarter 2022 Operational Highlights:

Total number of registered users reached 184 million as of September 30, 2022, representing an increase of 19.2% from 154 million as of September 30, 2021, and users with credit line reached 39.5 million as of September 30, 2022, up by 10.9% from 35.6 million as of September 30, 2021.
As of September 30, 2022, we cumulatively originated RMB808 billion in loans, an increase of 31.2% from RMB615 billion a year ago.

User Base

Number of active users1 who used our loan products in the third quarter of 2022 was 5.6 million, representing a decrease of 26.8% from 7.7 million in the third quarter of 2021.
Number of new active users who used our loan products in the third quarter of 2022 was 0.5 million, representing a decrease of 66.6% from 1.4 million in the third quarter of 2021.

Loan Facilitation Business

Total loan originations2 in the third quarter of 2022 was RMB56.2 billion, an increase of 0.7% from RMB55.8 billion in the third quarter of 2021.
Total outstanding principal balance of loans2 reached RMB94.6 billion as of September 30, 2022, representing an increase of 1.8% from RMB92.9 billion as of September 30, 2021.
In the third quarter, loan originations for small and micro business owners was RMB5.4 billion.
Number of orders placed on our platform in the third quarter of 2022 was 33.6 million, representing a decrease of 31.6% from 49.1 million in the third quarter of 2021.

 

Page 1 of 15


 

Credit Performance

90 day+ delinquency ratio was 2.66% as of September 30, 2022.
First payment default rate (30 day+) for new loan originations was below 1% as of September 30, 2022.

Technology-Driven Platform Services

In the third quarter of 2022, we had served over 100 business customers with our technology-driven platform services.
In the third quarter of 2022, our business customer retention rate3 of technology-driven platform services was over 80%.

New Consumption-Driven, Location-Based Services

The GMV4 in the third quarter of 2022 amounted to RMB1,224 million, representing an increase of 36.7% from RMB895 million in the third quarter of 2021.
In the third quarter of 2022, we served over 378,000 users and 2,800 merchants under new consumption-driven, location-based services.

Other Operational Highlights

The weighted average tenor of loans originated on our platform in the third quarter of 2022 was approximately 13.8 months, representing an increase from 11.0 months in the third quarter of 2021. The nominal APR5 was 15.7% for the third quarter of 2022, representing an increase from 14.0% in the third quarter of 2021.

Third Quarter 2022 Financial Highlights:

Total operating revenue was RMB2,690 million, representing a decrease of 9.4% from the third quarter of 2021.
Revenue from new consumption-driven, location-based services was RMB525 million, representing an increase of 31.3% from the third quarter of 2021. Cost of sales from new consumption-driven, location-based services was RMB531 million, representing an increase of 21.4% from in the third quarter of 2021. Gross margin from new consumption-driven, location-based services was negative RMB5.7 million, which was 84.7% smaller than the negative amount of RMB 37.2 million in the third quarter of 2021.
Net income attributable to ordinary shareholders of the Company was RMB275 million, representing a decrease of 52.5% from the third quarter of 2021. Net income per ADS attributable to ordinary shareholders of the Company was RMB1.51 on a fully diluted basis.
Adjusted net income attributable to ordinary shareholders of the Company6 was RMB330 million, representing a decrease of 48.4% from the third quarter of 2021. Adjusted net income per ADS attributable to ordinary shareholders of the Company6 was RMB1.73 on a fully diluted basis.

__________________________

1.
Active 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.
2.
Originations of loans and outstanding principal balance represent the origination and outstanding principal balance of both on- and off-balance sheet loans.
3.
Customer retention rate refers to the number of financial institution customers and partners who repurchase our service in the current quarter as a percentage of total number of financial institution customers and partners in the preceding quarter.
4.
GMV refers to the total value of transactions completed for products purchased on our e-commerce and Maiya channel, net of returns.
5.
Nominal APR refers to all-in interest costs and fees to the borrower over the net proceeds received by the borrower as a percentage of the total loan originations of both on- and off-balance sheet loans.
6.
Adjusted net income attributable to ordinary shareholders of the Company, adjusted net income per ordinary share and per ADS attributable to ordinary shareholders of the Company 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.

Page 2 of 15


 

 

Third Quarter 2022 Financial Results:

Operating revenue decreased by 9.4% from RMB2,969 million in the third quarter of 2021 to RMB2,690 million in the third quarter of 2022.

Revenue from new consumption-driven, location-based services increased by 31.3% from RMB400 million in the third quarter of 2021 to RMB525 million in the third quarter of 2022. The increase was primarily driven by the increase in transaction volume in the third quarter of 2022.

Revenue from technology-driven platform services decreased by 37.8% from RMB804 million in the third quarter of 2021 to RMB500 million in the third quarter of 2022. The decrease was primarily due to the decrease from profit-sharing model service within technology-driven platform services in the third quarter of 2022.

Revenue from credit-driven platform services decreased by 5.6% from RMB1,765 million in the third quarter of 2021 to RMB1,666 million in the third quarter of 2022. The decrease was primarily due to the decrease of loan facilitation and servicing fees-credit oriented and partially offset by the increase of interest and financial services income and other revenues and guarantee income.

Loan facilitation and servicing fees-credit oriented decreased by 39.8% from RMB1,187 million in the third quarter of 2021 to RMB714 million in the third quarter of 2022. The decrease was primarily due to the increase of guarantee obligation, which resulted in the decrease in considerations for revenue recognition.

 

Interest and financial services income and other revenues increased by 30.8% from RMB414 million in the third quarter of 2021 to RMB542 million in the third quarter of 2022. The increase was primarily driven by the increase in the origination of on-balance sheet loans in the third quarter of 2022.

Guarantee income increased by 149.8% from RMB164 million in the third quarter of 2021 to RMB410 million in the third quarter of 2022. The increase was primarily driven by the increase of loan origination and the increase of outstanding balances of the off-balance sheet loans funded by certain institutional funding partners, which are accounted for under ASC 460, Guarantees.

Cost of sales increased by 21.4% from RMB437 million in the third quarter of 2021 to RMB531 million in the third quarter of 2022, which was consistent with the increase of new consumption-driven revenue.

Funding cost increased by 41.1% from RMB106 million in the third quarter of 2021 to RMB150 million in the third quarter of 2022, which was consistent with the increase of the funding debts to fund the on-balance sheet loans.

Processing and servicing costs decreased by 9.8% from RMB524 million in the third quarter of 2021 to RMB472 million in the third quarter of 2022. This decrease was primarily driven by a decrease in fees to third party insurance companies and guarantee companies.

Provision for credit losses of financing and interest receivables decreased by 41.7% from RMB216 million in the third quarter of 2021 to RMB126 million in the third quarter of 2022. The credit losses have reflected the most recent performance in relation to the Company’s on-balance sheet loans and that the Company has continued to implement prudent credit assessment and risk management policies and procedures.

Provision for credit losses of contract assets and receivables was RMB133 million in the third quarter of 2022, as compared to RMB128 million in the third quarter of 2021.

 

Page 3 of 15


 

Provision for credit losses of contingent liabilities of guarantee was RMB382 million in the third quarter of 2022, as compared to RMB51.4 million in the third quarter of 2021. The increase was primarily due to the increase of loan origination of the off-balance sheet loans funded by certain institutional funding partners, which are accounted for under ASC 460, Guarantees.

Gross profit decreased by 40.4% from RMB1,507 million in the third quarter of 2021 to RMB897 million in the third quarter of 2022.

Sales and marketing expenses decreased by 13.5% from RMB491 million in the third quarter of 2021 to RMB425 million in the third quarter of 2022. The decrease was primarily driven by a decrease in online advertising cost, partially offset by an increase in salaries and personnel related costs.

Research and development expenses was RMB141 million in the third quarter of 2022, as compared to RMB131 million in the third quarter of 2021.

General and administrative expenses was RMB104 million in the third quarter of 2022, as compared to RMB100 million in the third quarter of 2021.

Change in fair value of financial guarantee derivatives and loans at fair value was a gain of RMB122 million in the third quarter of 2022, as compared to a loss of RMB80.8 million in the third quarter of 2021. The change in fair value was primarily driven by the fair value gains realized as a result of the release of guarantee obligation, along with the decrease in the balances of the underlying outstanding off-balance sheet loans as of September 30, 2022.

Income tax expense decreased by 33.2% from RMB106 million in the third quarter of 2021 to RMB70.8 million in the third quarter of 2022. The decrease of the income tax expense was consistent with the decrease of the taxable income in the third quarter of 2022.

Net income decreased by 52.5% from RMB581 million in the third quarter of 2021 to RMB276 million in third quarter of 2022.

 

Update of Share Repurchase Program

Existing US$50 Million Share Repurchase Program

On March 16, 2022, the Company’s board of directors authorized a share repurchase program under which the Company could repurchase up to an aggregate of US$50 million of its shares/ADSs over the next twelve months. As of September 30, 2022, the Company had repurchased approximately 20 million ADSs for approximately US$44 million under this repurchase program.

Authorization of US$20 Million Share Repurchase Program

The Company’s board of directors authorized a new share repurchase program under which the Company could purchase up to an aggregate of US$20 million of its shares/ADSs over the next twelve months from November 17, 2022. Same as the existing share repurchase program, the repurchases under this new program may be made from time to time through open market transactions at prevailing market prices, in privately negotiated transactions, in block trades and/or through other legally permissible means, depending on the market conditions and in accordance with applicable rules and regulations. The timing and dollar amount of the repurchase transactions will be subject to the Securities and Exchange Commission Rule 10b-18 and/or Rule 10b5-1 requirements. The Company expects to continue to fund the repurchases under the share repurchase programs with its existing cash balance.

 

Page 4 of 15


 

Conference Call

The Company’s management will host an earnings conference call at 8:30 PM U.S. Eastern time on November 16, 2022 (9:30 AM Beijing/Hong Kong time on November 17, 2022).
 

Participants who wish to join the conference call should register online at:

https://register.vevent.com/register/BI83536e70002548f3aa13d85629d1d3ba

Once registration is completed, each participant will receive the dial-in number and a unique access PIN for the conference call.

Participants joining the conference call should dial in at least 10 minutes before the scheduled start time.
 

A live and archived webcast of the conference call will be available on the Company’s investor relations website at http://ir.lexin.com.

 

About LexinFintech Holdings Ltd.

Lexin is a leading online and offline consumption platform and a technology-driven service provider in China. Established in 2013, the Company leverages its profound understanding of consumers in China and the valuable experience of partnering with hundreds of financial institutions over the years, as well as its advanced technological capabilities, to connect fast-growing new generation consumers and small and micro enterprise owners with well-established national and regional funding partners.
 

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

To follow us on Twitter, please go to: https://twitter.com/LexinFintech.

Page 5 of 15


 

Use of Non-GAAP Financial Measures Statement

In evaluating our business, we consider and use adjusted net income attributable to ordinary shareholders of the Company, non-GAAP EBIT, adjusted net income per ordinary share and per ADS attributable to ordinary shareholders of the Company, four 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 attributable to ordinary shareholders of the Company as net income attributable to ordinary shareholders of the Company excluding share-based compensation expenses, interest expense associated with convertible notes, and investment (loss)/income and we define non-GAAP EBIT as net income excluding income tax expense, share-based compensation expenses, interest expense, net, and investment (loss)/income .

We present these non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. Adjusted net income attributable to ordinary shareholders of the Company enables our management to assess our operating results without considering the impact of share-based compensation expenses, interest expense associated with convertible notes, and investment (loss)/income. 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, interest expense, net, and investment (loss)/income. We also believe that the use of these non-GAAP financial measures facilitates 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 attributable to ordinary shareholders of the Company and non-GAAP EBIT is that they do not reflect all items of income and expense that affect our operations. Share-based compensation expenses, interest expense associated with convertible notes, income tax expense, interest expense, net, and investment (loss)/income have been and may continue to be incurred in our business and are not reflected in the presentation of adjusted net income attributable to ordinary shareholders of the Company 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 each of the non-GAAP financial measures 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 RMB7.1135 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on September 30, 2022. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

 

Page 6 of 15


 

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 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. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Lexin’s goal and strategies; Lexin’s expansion plans; Lexin’s future business development, financial condition and results of operations; Lexin’s expectation regarding demand for, and market acceptance of, its credit and investment management products; Lexin’s expectations regarding keeping and strengthening its relationship with borrowers, institutional funding partners, merchandise suppliers and other parties it collaborates with; general economic and business conditions; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Lexin’s filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Lexin does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For investor and media inquiries, please contact:

LexinFintech Holdings Ltd.

IR inquiries:

Echo Yan

Tel: +86 (755) 3637-8888 ext. 6258

E-mail: echoyan@lexin.com

 

Media inquiries:

Limin Chen

Tel: +86 (755) 3637-8888 ext. 6993

E-mail: liminchen@lexin.com

SOURCE LexinFintech Holdings Ltd.

 

Page 7 of 15


 

LexinFintech Holdings Ltd.

Unaudited Condensed Consolidated Balance Sheets

 

As of

 

(In thousands)

December 31, 2021

 

September 30, 2022

 

 

RMB

 

RMB

 

US$

 

ASSETS

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

2,664,132

 

 

2,108,511

 

 

296,410

 

Restricted cash

 

1,305,435

 

 

1,236,978

 

 

173,892

 

Restricted time deposits

 

1,745,898

 

 

1,321,762

 

 

185,810

 

Short-term financing receivables, net of allowance for credit losses of RMB307,341 and RMB181,612 as of December 31, 2021 and September 30, 2022, respectively

 

3,772,975

 

 

6,119,987

 

 

860,334

 

Loans at fair value

 

252,970

 

 

295,527

 

 

41,545

 

Accrued interest receivable, net of allowance for credit losses of RMB1,367 and RMB2,033 as of December 31, 2021 and September 30, 2022, respectively

 

53,513

 

 

91,619

 

 

12,880

 

Prepaid expenses and other current assets

 

941,150

 

 

874,057

 

 

122,873

 

Amounts due from related parties

 

6,337

 

 

7,257

 

 

1,020

 

Deposits to insurance companies and guarantee companies

 

1,378,489

 

 

1,976,331

 

 

277,828

 

Short-term guarantee receivables, net of allowance for credit losses of RMB21,006 and RMB42,128 as of December 31, 2021 and September 30, 2022, respectively

 

543,949

 

 

810,503

 

 

113,939

 

Short-term contract assets and service fees receivable, net of allowance for credit losses of RMB187,261 and RMB141,631 as of December 31, 2021 and September 30, 2022, respectively

 

3,942,700

 

 

2,855,505

 

 

401,421

 

Inventories, net

 

47,816

 

 

86,736

 

 

12,193

 

Total current assets

 

16,655,364

 

 

17,784,773

 

 

2,500,145

 

Non‑current assets

 

 

 

 

 

 

Restricted cash

 

149,247

 

 

173,278

 

 

24,359

 

Long‑term financing receivables, net of allowance for credit losses of RMB19,523 and RMB13,436 as of December 31, 2021 and September 30, 2022, respectively

 

241,127

 

 

450,945

 

 

63,393

 

Long-term guarantee receivables, net of allowance for credit losses of RMB4,061 and RMB9,384 as of December 31, 2021 and September 30, 2022, respectively

 

101,562

 

 

177,387

 

 

24,937

 

Long-term contract assets and service fees receivable, net of allowance for credit losses of RMB34,973 and RMB31,025 as of December 31, 2021 and September 30, 2022, respectively

 

244,672

 

 

315,070

 

 

44,292

 

Property, equipment and software, net

 

195,330

 

 

242,672

 

 

34,114

 

Land use rights, net

 

966,067

 

 

940,267

 

 

132,181

 

Long‑term investments

 

469,064

 

 

472,407

 

 

66,410

 

Deferred tax assets

 

1,176,878

 

 

1,252,169

 

 

176,027

 

Other assets

 

826,883

 

 

989,457

 

 

139,096

 

Total non‑current assets

 

4,370,830

 

 

5,013,652

 

 

704,809

 

TOTAL ASSETS

 

21,026,194

 

 

22,798,425

 

 

3,204,954

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

15,705

 

 

33,438

 

 

4,701

 

Amounts due to related parties

 

23,102

 

 

3,802

 

 

534

 

Short‑term borrowings

 

1,799,741

 

 

1,245,682

 

 

175,115

 

Short‑term funding debts

 

3,101,381

 

 

3,908,918

 

 

549,507

 

Accrued interest payable

 

24,851

 

 

1,148

 

 

161

 

Deferred guarantee income

 

419,843

 

 

753,440

 

 

105,917

 

Contingent guarantee liabilities

 

928,840

 

 

838,250

 

 

117,839

 

Accrued expenses and other current liabilities

 

3,873,657

 

 

3,225,570

 

 

453,443

 

Convertible loans

 

-

 

 

2,101,816

 

 

295,469

 

Total current liabilities

 

10,187,120

 

 

12,112,064

 

 

1,702,686

 

Non‑current liabilities

 

 

 

 

 

 

Long‑term funding debts

 

696,852

 

 

2,065,671

 

 

290,387

 

Deferred tax liabilities

 

54,335

 

 

48,168

 

 

6,771

 

Long term borrowings

 

-

 

 

102,700

 

 

14,437

 

Convertible notes

 

1,882,689

 

 

-

 

 

-

 

Other long-term liabilities

 

137,389

 

 

112,179

 

 

15,770

 

Total non‑current liabilities

 

2,771,265

 

 

2,328,718

 

 

327,365

 

TOTAL LIABILITIES

 

12,958,385

 

 

14,440,782

 

 

2,030,051

 

SHAREHOLDERS’ EQUITY:

 

 

 

 

 

 

Class A Ordinary Shares

 

180

 

 

190

 

 

29

 

Class B Ordinary Shares

 

57

 

 

47

 

 

8

 

Treasury stock

 

-

 

 

(309,217

)

 

(43,469

)

Additional paid‑in capital

 

2,918,993

 

 

3,043,828

 

 

427,895

 

Statutory reserves

 

901,322

 

 

901,322

 

 

126,706

 

Accumulated other comprehensive income

 

11,273

 

 

(33,504

)

 

(4,710

)

Retained earnings

 

4,195,791

 

 

4,714,127

 

 

662,701

 

Non-controlling interests

 

40,193

 

 

40,850

 

 

5,743

 

TOTAL SHAREHOLDERS’ EQUITY

 

8,067,809

 

 

8,357,643

 

 

1,174,903

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

 

21,026,194

 

 

22,798,425

 

 

3,204,954

 

 

Page 8 of 15


 

LexinFintech Holdings Ltd.

Unaudited Condensed Consolidated Statements of Operations

 

For the Three Months Ended September 30,

 

 

For the Nine Months Ended September 30,

 

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

2021

 

2022

 

 

2021

 

2022

 

 

RMB

 

RMB

 

US$

 

 

RMB

 

RMB

 

US$

 

Operating revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

New Consumption-Driven, Location-Based Services (1)

 

399,754

 

 

524,986

 

 

73,801

 

 

 

1,238,740

 

 

1,382,071

 

 

194,288

 

Technology-Driven Platform Services (1)

 

803,737

 

 

499,699

 

 

70,247

 

 

 

2,132,071

 

 

1,433,174

 

 

201,472

 

Credit-Driven Platform Services (1)

 

1,765,304

 

 

1,665,652

 

 

234,154

 

 

 

5,810,503

 

 

4,000,300

 

 

562,353

 

Loan facilitation and servicing fees- credit oriented (1)

 

1,187,060

 

 

714,102

 

 

100,387

 

 

 

3,842,315

 

 

1,637,287

 

 

230,166

 

Interest and financial services income and other revenues (1)

 

414,192

 

 

541,708

 

 

76,152

 

 

 

1,365,492

 

 

1,409,495

 

 

198,144

 

Guarantee income (1)

 

164,052

 

 

409,842

 

 

57,615

 

 

 

602,696

 

 

953,518

 

 

134,043

 

Total operating revenue

 

2,968,795

 

 

2,690,337

 

 

378,202

 

 

 

9,181,314

 

 

6,815,545

 

 

958,113

 

Operating cost:

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

(436,973

)

 

(530,685

)

 

(74,603

)

 

 

(1,297,433

)

 

(1,410,265

)

 

(198,252

)

Funding cost

 

(106,013

)

 

(149,545

)

 

(21,023

)

 

 

(359,393

)

 

(371,694

)

 

(52,252

)

Processing and servicing cost

 

(523,611

)

 

(472,261

)

 

(66,389

)

 

 

(1,390,244

)

 

(1,408,357

)

 

(197,984

)

Provision for credit losses of financing and interest receivables

 

(216,344

)

 

(126,214

)

 

(17,743

)

 

 

(499,977

)

 

(290,962

)

 

(40,903

)

Provision for credit losses of contract assets and receivables

 

(127,958

)

 

(132,678

)

 

(18,652

)

 

 

(486,593

)

 

(333,896

)

 

(46,938

)

Provision for credit losses of contingent liabilities of guarantee

 

(51,374

)

 

(381,697

)

 

(53,658

)

 

 

(610,658

)

 

(1,009,013

)

 

(141,845

)

Total operating cost

 

(1,462,273

)

 

(1,793,080

)

 

(252,068

)

 

 

(4,644,298

)

 

(4,824,187

)

 

(678,174

)

Gross profit

 

1,506,522

 

 

897,257

 

 

126,134

 

 

 

4,537,016

 

 

1,991,358

 

 

279,939

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing expenses

 

(490,934

)

 

(424,544

)

 

(59,681

)

 

 

(1,331,252

)

 

(1,262,441

)

 

(177,471

)

Research and development expenses

 

(130,996

)

 

(140,560

)

 

(19,760

)

 

 

(385,650

)

 

(447,595

)

 

(62,922

)

General and administrative expenses

 

(100,463

)

 

(104,389

)

 

(14,675

)

 

 

(352,413

)

 

(334,513

)

 

(47,025

)

Total operating expenses

 

(722,393

)

 

(669,493

)

 

(94,116

)

 

 

(2,069,315

)

 

(2,044,549

)

 

(287,418

)

Change in fair value of financial guarantee derivatives and loans at fair value

 

(80,755

)

 

121,776

 

 

17,119

 

 

 

(6,356

)

 

689,196

 

 

96,886

 

Interest expense, net

 

(14,023

)

 

(16,202

)

 

(2,278

)

 

 

(50,373

)

 

(47,449

)

 

(6,670

)

Investment (loss)/ income

 

(1,656

)

 

(3,027

)

 

(426

)

 

 

(4,053

)

 

4,479

 

 

630

 

Other, net

 

(946

)

 

16,210

 

 

2,279

 

 

 

59,889

 

 

61,929

 

 

8,706

 

Income before income tax expense

 

686,749

 

 

346,521

 

 

48,712

 

 

 

2,466,808

 

 

654,964

 

 

92,073

 

Income tax expense

 

(105,987

)

 

(70,828

)

 

(9,957

)

 

 

(388,303

)

 

(130,338

)

 

(18,323

)

 Net income

 

580,762

 

 

275,693

 

 

38,755

 

 

 

2,078,505

 

 

524,626

 

 

73,750

 

Less: net income attributable to non-controlling interests

 

279

 

 

231

 

 

32

 

 

 

326

 

 

6,290

 

 

884

 

Net income attributable to ordinary shareholders of the Company

 

580,483

 

 

275,462

 

 

38,723

 

 

 

2,078,179

 

 

518,336

 

 

72,866

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per ordinary share attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

1.57

 

 

0.82

 

 

0.11

 

 

 

5.64

 

 

1.49

 

 

0.21

 

Diluted

 

1.43

 

 

0.75

 

 

0.11

 

 

 

5.08

 

 

1.40

 

 

0.20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per ADS attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

3.15

 

 

1.64

 

 

0.23

 

 

 

11.28

 

 

2.97

 

 

0.42

 

Diluted

 

2.86

 

 

1.51

 

 

0.21

 

 

 

10.17

 

 

2.81

 

 

0.39

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average ordinary shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

368,873,003

 

 

336,900,544

 

 

336,900,544

 

 

 

368,375,020

 

 

348,868,793

 

 

348,868,793

 

Diluted

 

414,206,884

 

 

381,524,186

 

 

381,524,186

 

 

 

415,500,045

 

 

393,605,236

 

 

393,605,236

 

__________________________


(1) Starting from the first quarter of 2022, we report our revenue streams in three categories - new consumption-driven, location-based services, technology-driven platform services, and credit-driven platform services, to provide more relevant and updated information. We also revised the revenue presentation in comparative periods to conform to the current classification.
 

In providing new consumption-driven, location-based services, we provide platform and services for merchants, shopping malls, and brands to conduct sales and marketing, with the goal to drive transaction volume, for which we charge a service fee. Revenue earned from the online direct sales and services is recognized under new consumption-driven, location-based services, which was previously reported as “Online direct sales” and “Other services” within “Online direct sales and services income” before the change of presentation.
 

Page 9 of 15


 

In providing technology-driven platform services, we offer a comprehensive set of services to our customers that enable them to increase revenues, manage financial risks, improve operating efficiency, improve service quality, enhance collections, and reduce overall costs. Revenue earned from platform-based services, membership services and other services is reported as one combined financial statement line item under “Technology-driven platform services.” The membership fees and other services revenue were previously reported as “Membership services” and “Other services” within “Online direct sales and services income” before the change of presentation.
 

The revenue earned from credit-oriented services is recognized under credit-driven platform services, which includes “Loan facilitation and servicing fees-credit oriented,” “Interest and financial services income and other revenues,” and “Guarantee income.”



 

 

Page 10 of 15


 

LexinFintech Holdings Ltd.

Unaudited Condensed Consolidated Statements of Comprehensive Income

 

 

For the Three Months Ended September 30,

 

 

For the Nine Months Ended September 30,

 

(In thousands)

2021

 

2022

 

 

2021

 

2022

 

 

RMB

 

RMB

 

US$

 

 

RMB

 

RMB

 

US$

 

Net income

 

580,762

 

 

275,693

 

 

38,755

 

 

 

2,078,505

 

 

524,626

 

 

73,750

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment, net of nil tax

 

(936

)

 

(25,170

)

 

(3,538

)

 

 

2,297

 

 

(44,777

)

 

(6,295

)

Total comprehensive income

 

579,826

 

 

250,523

 

 

35,217

 

 

 

2,080,802

 

 

479,849

 

 

67,455

 

Less: net income attributable to non-controlling interests

 

279

 

 

231

 

 

32

 

 

 

326

 

 

6,290

 

 

884

 

Total comprehensive income attributable to ordinary shareholders of the Company

 

579,547

 

 

250,292

 

 

35,185

 

 

 

2,080,476

 

 

473,559

 

 

66,571

 

 

Page 11 of 15


 

LexinFintech Holdings Ltd.

Unaudited Reconciliations of GAAP and Non-GAAP Results

 

 

For the Three Months Ended September 30,

 

 

For the Nine Months Ended September 30,

 

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

2021

 

2022

 

 

2021

 

2022

 

 

RMB

 

RMB

 

US$

 

 

RMB

 

RMB

 

US$

 

Reconciliation of Adjusted net income attributable to ordinary shareholders of the Company to Net income attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to ordinary shareholders of the Company

 

580,483

 

 

275,462

 

 

38,723

 

 

 

2,078,179

 

 

518,336

 

 

72,866

 

Add: Share-based compensation expenses

 

47,363

 

 

39,963

 

 

5,618

 

 

 

139,845

 

 

119,781

 

 

16,839

 

Interest expense associated with convertible notes

 

11,375

 

 

12,044

 

 

1,693

 

 

 

33,675

 

 

34,454

 

 

4,843

 

Investment loss/(income)

 

1,656

 

 

3,027

 

 

426

 

 

 

4,053

 

 

(4,479

)

 

(630

)

Tax effects on Non-GAAP adjustments (2)

 

-

 

 

-

 

 

-

 

 

 

7,151

 

 

-

 

 

-

 

Adjusted net income attributable to ordinary shareholders of the Company

 

640,877

 

 

330,496

 

 

46,460

 

 

 

2,262,903

 

 

668,092

 

 

93,918

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income per ordinary share attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

1.74

 

 

0.98

 

 

0.14

 

 

 

6.14

 

 

1.92

 

 

0.27

 

Diluted

 

1.55

 

 

0.87

 

 

0.12

 

 

 

5.45

 

 

1.70

 

 

0.24

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income per ADS attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

3.47

 

 

1.96

 

 

0.28

 

 

 

12.29

 

 

3.83

 

 

0.54

 

Diluted

 

3.09

 

 

1.73

 

 

0.24

 

 

 

10.89

 

 

3.39

 

 

0.48

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of ordinary shares outstanding attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

368,873,003

 

 

336,900,544

 

 

336,900,544

 

 

 

368,375,020

 

 

348,868,793

 

 

348,868,793

 

Diluted

 

414,206,884

 

 

381,524,186

 

 

381,524,186

 

 

 

415,500,045

 

 

393,605,236

 

 

393,605,236

 

__________________________

(2) To exclude the tax effects related to the investment loss/(income)

 

 

Page 12 of 15


 

LexinFintech Holdings Ltd.

Unaudited Reconciliations of GAAP and Non-GAAP Results

 

For the Three Months Ended September 30,

 

 

For the Nine Months Ended September 30,

 

(In thousands)

2021

 

2022

 

 

2021

 

2022

 

 

RMB

 

RMB

 

US$

 

 

RMB

 

RMB

 

US$

 

Reconciliations of Non-GAAP EBIT to Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

580,762

 

 

275,693

 

 

38,755

 

 

 

2,078,505

 

 

524,626

 

 

73,750

 

Add: Income tax expense

 

105,987

 

 

70,828

 

 

9,957

 

 

 

388,303

 

 

130,338

 

 

18,323

 

Share-based compensation expenses

 

47,363

 

 

39,963

 

 

5,618

 

 

 

139,845

 

 

119,781

 

 

16,839

 

Interest expense, net

 

14,023

 

 

16,202

 

 

2,278

 

 

 

50,373

 

 

47,449

 

 

6,670

 

Investment loss/(income)

 

1,656

 

 

3,027

 

 

426

 

 

 

4,053

 

 

(4,479

)

 

(630

)

Non-GAAP EBIT

 

749,791

 

 

405,713

 

 

57,034

 

 

 

2,661,079

 

 

817,715

 

 

114,952

 

 

 

 

Page 13 of 15


 

Additional Credit Information

Vintage Charge Off Curve

https://cdn.kscope.io/8a02334f8fab388a55cde353a2a4d5d7-img85518425_0.jpg 

 

Dpd30+/GMV by Performance Windows

https://cdn.kscope.io/8a02334f8fab388a55cde353a2a4d5d7-img85518425_1.jpg 

 

 

Page 14 of 15


 

First Payment Default 30+

https://cdn.kscope.io/8a02334f8fab388a55cde353a2a4d5d7-img85518425_2.jpg 

Page 15 of 15