LX LexinFintech Holdings Ltd

 

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 2024

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 _________

 

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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/ James Xigui Zheng
Name:		James Xigui Zheng
Title:		Chief Financial Officer

 

Date: November 25, 2024

 

 

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Exhibit Index

Exhibit 99.1—Press Release

 

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Exhibit 99.1

LexinFintech Holdings Ltd. Reports Third Quarter 2024

Unaudited Financial Results

SHENZHEN, China, November 25, 2024 (GLOBE NEWSWIRE) -- LexinFintech Holdings Ltd. (“Lexin” or the “Company”) (NASDAQ: LX), a leading technology-empowered personal financial service enabler in China, today announced its unaudited financial results for the quarter ended September 30, 2024.

 

“Total loan origination for the third quarter reached approximately RMB51.0 billion, remaining stable on a quarter-over-quarter basis, but reflecting a 19.5% decrease year-over-year. The outstanding loan balance was RMB111.2 billion, down by 3.4% quarter-over-quarter and by 7.8% year-over-year. These figures align with the guidance we provided earlier, reflecting our prudent operational principles amid the challenges of a sluggish macroeconomic recovery,” said Jay Wenjie Xiao, Chairman and CEO of Lexin. “However, despite the trend of a declining loan volume, our net profit reached RMB310 million, a substantial increase of 36.7% compared to RMB227 million in the previous quarter.”

“Improved profitability is part of a strong set of operational and financial results we delivered this quarter, demonstrating that we are well on track for a comprehensive business turnaround.”

“During the past quarter, our persistent efforts in executing transformation strategies led to a record low funding cost, gradual improvement in asset quality, and a substantial increase in new users with approved credit lines.”

“Considering the gradual business recovery, we remain committed to returning more value to shareholders. The Board has approved an amended dividend payout policy, increasing the payout ratio to 25% of net profit starting in 2025.”

“Looking ahead, while we are cautious about the short-term economic outlook and anticipate that the recently released government stimulus measures targeting at an economic recovery will gradually take effect, we remain confident in Lexin’s ability to navigate through uncertainties and sustain the recovery momentum by delivering solid results quarter by quarter,” Concluded Mr. Xiao.

“During the past quarter, we have delivered another set of robust financial results,” said Mr. James Zheng, Chief Financial Officer of Lexin. “The third quarter's total operating revenue reached approximately RMB3.7 billion, up by 4.4% year-over-year and stable quarter-over-quarter. Net profit for the third quarter reached RMB310 million, a substantial growth of 36.7% compared to the previous quarter. This significant increase in net profit is largely attributable to the improved net revenue take rate of our core loan business, supported by continuous risk improvements in newly issued loans, a significant reduction in funding costs by nearly 100 basis points over the past quarter, and a slight improvement in the early repayment behavior. Given the ongoing improvement in our overall asset quality and the continuous execution of our transformation initiatives, we expect to report more positive progress in the year ahead.”

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Third Quarter 2024 Operational Highlights:

User Base

Loan Facilitation Business

Credit Performance4

Tech-empowerment Service

Installment E-commerce Platform Service

Other Operational Highlights

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Third Quarter 2024 Financial Highlights:

__________________________

Third Quarter 2024 Financial Results:

Operating revenue increased by 4.4% from RMB3,509 million in the third quarter of 2023 to RMB3,662 million in the third quarter of 2024.

Credit facilitation service income increased by 10.6% from RMB2,686 million in the third quarter of 2023 to RMB2,970 million in the third quarter of 2024. The increase was driven by the increases in loan facilitation and servicing fees-credit oriented, partially offset by the decrease in financing income and guarantee income.

Loan facilitation and servicing fees-credit oriented increased by 20.7% from RMB1,533 million in the third quarter of 2023 to RMB1,851 million in the third quarter of 2024. The increase was primarily due to the increase in takerate of loan facilitation business.

 

Guarantee income decreased by 2.9% from RMB639 million in the third quarter of 2023 to RMB620 million in the third quarter of 2024. The decrease was primarily driven by the decrease of outstanding balances in the off-balance sheet loans funded by certain institutional funding partners, which are accounted for under ASC 460, Guarantees.

 

Financing income decreased by 2.8% from RMB514 million in the third quarter of 2023 to RMB499 million in the third quarter of 2024. The decrease was primarily due to the decrease in the origination of on-balance sheet loans.

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Tech-empowerment service income decreased by 15.5% from RMB454 million in the third quarter of 2023 to RMB384 million in the third quarter of 2024. The decrease was primarily due to the decrease of loan facilitation volume under the profit-sharing model.

 

Installment e-commerce platform service income decreased by 16.6% from RMB369 million in the third quarter of 2023 to RMB308 million in the third quarter of 2024. The decrease was primarily due to the decrease in transaction volume in the third quarter of 2024.

Cost of sales decreased by 14.3% from RMB360 million in the third quarter of 2023 to RMB308 million in the third quarter of 2024, which was consistent with the decrease in installment e-commerce platform service income.

Funding cost decreased by 33.4% from RMB132 million in the third quarter of 2023 to RMB87.7 million in the third quarter of 2024, which was primarily driven by the decrease in the cost of funding and funding debts to fund the on-balance sheet loans.

Processing and servicing costs increased by 35.1% from RMB446 million in the third quarter of 2023 to RMB602 million in the third quarter of 2024. This increase was primarily due to an increase in risk management and collection expenses.

Provision for financing receivables was RMB261 million for the third quarter of 2024, as compared to RMB162 million for the third quarter of 2023. The lifetime expected credit losses recognized was estimated based on the most recent performance in relation to the Company's on-balance sheet loans, taking into consideration the forward-looking factors.

Provision for contract assets and receivables was RMB244 million in the third quarter of 2024, as compared to RMB159 million in the third quarter of 2023. The increase was primarily due to the increase in loan facilitation and servicing fees.

Provision for contingent guarantee liabilities was RMB952 million in the third quarter of 2024, as compared to RMB894 million in the third quarter of 2023. The fluctuation was primarily due to the re-measurement of the expected loss rates and the 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 11.0% from RMB1,356 million in the third quarter of 2023 to RMB1,207 million in the third quarter of 2024.

Sales and marketing expenses was RMB438 million in the third quarter of 2024, as compared to RMB411 million in the third quarter of 2023. The increase was primarily due to increased investment in marketing.

Research and development expenses was RMB149 million in the third quarter of 2024, as compared to RMB127 million in the third quarter of 2023. The increase was primarily due to increased investment in technology development.

General and administrative expenses was RMB89.0 million in the third quarter of 2024, as compared to RMB85.5 million in the third quarter of 2023.

Change in fair value of financial guarantee derivatives and loans at fair value was a loss of RMB151 million in the third quarter of 2024, as compared to a loss of RMB246 million in the third quarter of 2023. The change in fair value was primarily due to the re-measurement of the expected loss rates, partially offset by the fair value gains realized as a result of the release of guarantee obligation.

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Income tax expense was RMB72.2 million in the third quarter of 2024, as compared to RMB116 million in the third quarter of 2023. The change was primarily due to the decrease of income before income tax expense.

Net income decreased by 16.5% from RMB371 million in the third quarter of 2023 to RMB310 million in the third quarter of 2024.

 

 

Recent Development

Amended Dividend Policy

The board of directors of the Company has approved an amended dividend payout policy, under which the payout ratio will be increased to 25% of total net profit starting from January 1, 2025.

 

 

Conference Call

The Company’s management will host an earnings conference call at 9:00 PM U.S. Eastern time on November 25, 2024 (10:00 AM Beijing/Hong Kong time on November 26, 2024).

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

https://register.vevent.com/register/BI220a892f574848f0b2997fb493e6296f

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 also be available at the Company's investor relations website at http://ir.lexin.com.

 

 

About LexinFintech Holdings Ltd.

We are a leading credit technology-empowered personal financial service enabler. Our mission is to use technology and risk management expertise to make financing more accessible for young generation consumers. We strive to achieve this mission by connecting consumers with financial institutions, where we facilitate through a unique model that includes online and offline channels, installment consumption platform, big data and AI driven credit risk management capabilities, as well as smart user and loan management systems. We also empower financial institutions by providing cutting-edge proprietary technology solutions to meet their needs of financial digital transformation.

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

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

 

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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 income/(loss) and we define non-GAAP EBIT as net income excluding income tax expense, share-based compensation expenses, interest expense, net, and investment income/(loss).

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 income/(loss). 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 income/(loss). 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 income/(loss) 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 RMB7.0176 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on September 30, 2024. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

 

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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 the 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:

Mandy Dong

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

E-mail: Mandydong@lexin.com

 

Media inquiries:

Ruifeng Xu

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

E-mail: media@lexin.com

SOURCE LexinFintech Holdings Ltd.

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LexinFintech Holdings Ltd.

Unaudited Condensed Consolidated Balance Sheets

	As of
(In thousands)	December 31, 2023			September 30, 2024
	RMB			RMB			US$
ASSETS
Current Assets
Cash and cash equivalents		2,624,719			2,153,594			306,885
Restricted cash		1,433,502			1,431,783			204,027
Restricted term deposit and short-term investments		305,182			266,512			37,978
Short-term financing receivables, net(1)		3,944,000			3,963,912			564,853
Short-term contract assets and receivables, net(1)		6,112,981			6,613,308			942,389
Deposits to insurance companies and guarantee companies		2,613,271			2,330,314			332,067
Prepayments and other current assets		1,428,769			1,416,024			201,783
Amounts due from related parties		6,989			11,067			1,577
Inventories, net		33,605			48,396			6,896
Total Current Assets		18,503,018			18,234,910			2,598,455
Non-current Assets
Restricted cash		144,948			106,930			15,237
Long-term financing receivables, net(1)		200,514			132,946			18,945
Long-term contract assets and receivables, net(1)		599,818			404,798			57,683
Property, equipment and software, net		446,640			578,874			82,489
Land use rights, net		897,267			871,467			124,183
Long‑term investments		255,003			252,833			36,028
Deferred tax assets		1,232,092			1,374,393			195,849
Other assets		861,491			567,915			80,929
Total Non-current Assets		4,637,773			4,290,156			611,343
TOTAL ASSETS		23,140,791			22,525,066			3,209,798
LIABILITIES
Current liabilities
Accounts payable		49,801			32,215			4,591
Amounts due to related parties		2,958			12,358			1,761
Short‑term borrowings		502,013			552,589			78,743
Short‑term funding debts		3,483,196			2,972,938			423,640
Deferred guarantee income		1,538,385			1,135,911			161,866
Contingent guarantee liabilities		1,808,540			1,268,803			180,803
Accruals and other current liabilities		4,434,254			4,978,006			709,360
Convertible notes		505,450			-			-
Total Current Liabilities		12,324,597			10,952,820			1,560,764
Non-current Liabilities
Long-term borrowings		524,270			585,024			83,365
Long‑term funding debts		455,800			444,750			63,376
Deferred tax liabilities		75,340			79,445			11,321
Other long-term liabilities		50,702			38,964			5,553
Total Non-current Liabilities		1,106,112			1,148,183			163,615
TOTAL LIABILITIES		13,430,709			12,101,003			1,724,379
Shareholders’ equity:
Class A Ordinary Shares		199			201			30
Class B Ordinary Shares		41			41			7
Treasury stock		(328,764	)		(328,764	)		(46,848	)
Additional paid-in capital		3,204,961			3,276,302			466,869
Statutory reserves		1,106,579			1,106,579			157,686
Accumulated other comprehensive income		(13,545	)		(30,201	)		(4,304	)
Retained earnings		5,740,611			6,399,905			911,979
Total shareholders’ equity		9,710,082			10,424,063			1,485,419
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		23,140,791			22,525,066			3,209,798

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(1) Short-term financing receivables, net of allowance for credit losses of RMB58,594 and RMB123,569 as of December 31, 2023 and September 30, 2024, respectively.

Short-term contract assets and receivables, net of allowance for credit losses of RMB436,136 and RMB462,438 as of December 31, 2023 and September 30, 2024, respectively.

Long-term financing receivables, net of allowance for credit losses of RMB3,087 and RMB1,848 as of December 31, 2023 and September 30, 2024, respectively.

Long-term contract assets and receivables, net of allowance for credit losses of RMB61,838 and RMB35,497 as of December 31, 2023 and September 30, 2024, respectively.
 

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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)	2023			2024							2023			2024
	RMB			RMB			US$				RMB			RMB			US$
Operating revenue:
Credit facilitation service income		2,685,574			2,970,294			423,264				6,939,100			8,287,865			1,181,011
Loan facilitation and servicing fees-credit oriented		1,533,203			1,850,850			263,744				3,443,293			4,701,514			669,960
Guarantee income		638,595			620,117			88,366				1,809,862			2,086,656			297,346
Financing income		513,776			499,327			71,154				1,685,945			1,499,695			213,705
Tech-empowerment service income		453,944			383,592			54,661				1,213,571			1,279,683			182,353
Installment e-commerce platform service income		369,417			308,257			43,926				1,394,975			977,213			139,252
Total operating revenue		3,508,935			3,662,143			521,851				9,547,646			10,544,761			1,502,616
Operating cost
Cost of sales		(359,683	)		(308,097	)		(43,903	)			(1,291,547	)		(966,777	)		(137,765	)
Funding cost		(131,640	)		(87,717	)		(12,500	)			(437,674	)		(268,980	)		(38,329	)
Processing and servicing cost		(445,845	)		(602,362	)		(85,836	)			(1,420,946	)		(1,708,785	)		(243,500	)
Provision for financing receivables		(161,807	)		(261,126	)		(37,210	)			(446,586	)		(568,783	)		(81,051	)
Provision for contract assets and receivables		(159,443	)		(243,725	)		(34,731	)			(426,631	)		(564,445	)		(80,433	)
Provision for contingent guarantee liabilities		(894,174	)		(951,738	)		(135,622	)			(2,269,269	)		(2,714,808	)		(386,857	)
Total operating cost		(2,152,592	)		(2,454,765	)		(349,802	)			(6,292,653	)		(6,792,578	)		(967,935	)
Gross profit		1,356,343			1,207,378			172,049				3,254,993			3,752,183			534,681
Operating expenses:
Sales and marketing expenses		(410,651	)		(437,996	)		(62,414	)			(1,303,728	)		(1,323,036	)		(188,531	)
Research and development expenses		(126,582	)		(148,930	)		(21,222	)			(377,447	)		(427,162	)		(60,870	)
General and administrative expenses		(85,526	)		(88,952	)		(12,676	)			(279,082	)		(279,146	)		(39,778	)
Total operating expenses		(622,759	)		(675,878	)		(96,312	)			(1,960,257	)		(2,029,344	)		(289,179	)
Change in fair value of financial guarantee derivatives and loans at fair value		(245,568	)		(151,431	)		(21,579	)			41,158			(835,615	)		(119,074	)
Interest expense, net		(14,354	)		(4,531	)		(646	)			(40,238	)		(6,447	)		(919	)
Investment loss		(568	)		(2,224	)		(317	)			(1,107	)		(1,874	)		(267	)
Others, net		13,010			8,406			1,198				29,866			44,434			6,332
Income before income tax expense		486,104			381,720			54,393				1,324,415			923,337			131,574
Income tax expense		(115,479	)		(72,163	)		(10,283	)			(270,567	)		(185,626	)		(26,451	)
Net income		370,625			309,557			44,110				1,053,848			737,711			105,123
Net income attributable to ordinary shareholders of the Company		370,625			309,557			44,110				1,053,848			737,711			105,123
Net income per ordinary share attributable to ordinary shareholders of the Company
Basic		1.13			0.93			0.13				3.21			2.23			0.32
Diluted		1.10			0.92			0.13				3.06			2.22			0.32
Net income per ADS attributable to ordinary shareholders of the Company
Basic		2.25			1.87			0.27				6.42			4.46			0.64
Diluted		2.20			1.84			0.26				6.12			4.44			0.63
Weighted average ordinary shares outstanding
Basic		328,993,585			331,356,003			331,356,003				328,524,266			330,806,594			330,806,594
Diluted		355,221,352			336,606,267			336,606,267				364,767,295			335,151,610			335,151,610

 

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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)	2023			2024							2023			2024
	RMB			RMB			US$				RMB			RMB			US$
Net income		370,625			309,557			44,110				1,053,848			737,711			105,123
Other comprehensive income
Foreign currency translation adjustment, net of nil tax		38			(5,424	)		(773	)			(20,544	)		(16,655	)		(2,373	)
Total comprehensive income		370,663			304,133			43,337				1,033,304			721,056			102,750
Total comprehensive income attributable to ordinary shareholders of the Company		370,663			304,133			43,337				1,033,304			721,056			102,750

 

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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)	2023			2024							2023			2024
	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		370,625			309,557			44,110				1,053,848			737,711			105,123
Add: Share-based compensation expenses		26,237			20,986			2,990				84,893			67,379			9,601
Interest expense associated with convertible notes		19,791			-			-				61,864			5,695			812
Investment loss		568			2,224			317				1,107			1,874			267
Adjusted net income attributable to ordinary shareholders of the Company		417,221			332,767			47,417				1,201,712			812,659			115,803
Adjusted net income per ordinary share attributable to ordinary shareholders of the Company
Basic		1.27			1.00			0.14				3.66			2.46			0.35
Diluted		1.17			0.99			0.14				3.29			2.42			0.35
Adjusted net income per ADS attributable to ordinary shareholders of the Company
Basic		2.54			2.01			0.29				7.32			4.91			0.70
Diluted		2.35			1.98			0.28				6.59			4.85			0.69
Weighted average shares used in calculating net income per ordinary share for non-GAAP EPS
Basic		328,993,585			331,356,003			331,356,003				328,524,266			330,806,594			330,806,594
Diluted		355,221,352			336,606,267			336,606,267				364,767,295			335,151,610			335,151,610
Reconciliations of Non-GAAP EBIT to Net income
Net income		370,625			309,557			44,110				1,053,848			737,711			105,123
Add: Income tax expense		115,479			72,163			10,283				270,567			185,626			26,451
Share-based compensation expenses		26,237			20,986			2,990				84,893			67,379			9,601
Interest expense, net		14,354			4,531			646				40,238			6,447			919
Investment loss		568			2,224			317				1,107			1,874			267
Non-GAAP EBIT		527,263			409,461			58,346				1,450,653			999,037			142,361

 

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Additional Credit Information

Vintage Charge Off Curve1

Dpd30+/GMV by Performance Windows1

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First Payment Default 30+1

1. Loans facilitated under ICP are excluded from the chart.

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