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 2023

 

Commission File Number: 001-38652

 

X Financial

(Exact name of registrant as specified in its charter)

 

7-8F, Block A, Aerospace Science and Technology Plaza

No. 168, Haide Third Avenue, Nanshan District

Shenzhen, 518067, the People’s Republic of China

+86-755-86282977

(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover 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 ST Rule 101(b)(1): Not Applicable

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation ST Rule 101(b)(7): Not Applicable

 

 

 

 

 

 

EXHIBIT INDEX

 

Exhibit   Description
99.1   Press Release titled “X Financial Reports Third Quarter 2023 Unaudited Financial Results”

 

 

 

 

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 hereunto duly authorized.

 

  X Financial
   
  By: /s/ Yue (Justin) Tang
  Name: Yue (Justin) Tang
  Title: Chairman and Chief Executive Officer

 

Date: November 22, 2023

 

 

 

 

Exhibit 99.1

 

X Financial Reports Third Quarter 2023 Unaudited Financial Results

 

SHENZHEN, China, November 22, 2023 /PRNewswire/ -- X Financial (NYSE: XYF) (the “Company” or “we”), a leading online personal finance company in China, today announced its unaudited financial results for the third quarter ended September 30, 2023.

 

Third Quarter 2023 Operational Highlights

 

   Three Months Ended   Three Months Ended   Three Months Ended         
   September 30, 2022   June 30, 2023   September 30, 2023   QoQ   YoY 
Total loan amount facilitated and originated (RMB in million)   19,825    25,874    29,462    13.9%   48.6%
Number of active borrowers   1,415,059    1,474,930    1,809,815    22.7%   27.9%

 

·The total loan amount facilitated and originated1 in the third quarter of 2023 was RMB29,462 million, representing an increase of 48.6% from RMB19,825 million in the same period of 2022.

·Total number of active borrowers2 was 1,809,815 in the third quarter of 2023, representing an increase of 27.9% from 1,415,059 in the same period of 2022.

 

   As of September 30, 2022   As of June 30, 2023   As of September 30, 2023 
Total outstanding loan balance (RMB in million)   33,789    45,071    49,685 
Delinquency rates for all outstanding loans that are past due for 31-60 days   0.77%   0.96%   1.11%
Delinquency rates for all outstanding loans that are past due for 91-180 days   2.22%   2.50%   2.50%

 

·The total outstanding loan balance 3 as of September 30, 2023 was RMB49,685 million, compared with RMB33,789 million as of September 30, 2022.

·The delinquency rate for all outstanding loans that are past due for 31-60 days4 as of September 30, 2023 was 1.11%, compared with 0.77% as of September 30, 2022.

·The delinquency rate for all outstanding loans that are past due for 91-180 days5 as of September 30, 2023 was 2.50%, compared with 2.22% as of September 30, 2022.

 

 

1 Represents the total amount of loans that the Company facilitated and originated during the relevant period.

2 Represents borrowers who made at least one transaction on the Company’s platform during the relevant period.

3 Represents the total amount of loans outstanding for loans that the Company facilitated and originated at the end of the relevant period. Loans that are delinquent for more than 60 days are charged-off and are excluded in the outstanding loan balance, except for Xiaoying Housing Loan. As Xiaoying Housing Loan is a secured loan product and the Company is entitled to payment by exercising its rights to the collateral, the Company does not exclude Xiaoying Housing Loan delinquent for more than 60 days in the outstanding loan balance.

4 Represents the balance of the outstanding principal and accrued outstanding interest for loans that were 31 to 60 days past due as a percentage of the total balance of outstanding principal and accrued outstanding interest for loans that the Company facilitated and originated as of a specific date. Loans that are delinquent for more than 60 days are charged-off and excluded in the calculation of delinquency rate by balance. Xiaoying Housing Loan was launched in 2015 and ceased in 2019, and all the outstanding loan balance of housing loan as of September 30, 2022, June 30, 2023 and September 30, 2023 were overdue more than 60 days. To make the delinquency rate by balance comparable, the Company excludes Xiaoying Housing Loan in the calculation of delinquency rate.

5 To make the delinquency rate by balance comparable to the peers, the Company also defines the delinquency rate as the balance of the outstanding principal and accrued outstanding interest for loans that were 91 to 180 days past due as a percentage of the total balance of outstanding principal and accrued outstanding interest for the loans that the Company facilitated and originated as of a specific date. Loans that are delinquent for more than 180 days are excluded in the calculation of delinquency rate by balance, except for Xiaoying Housing Loan. All the outstanding loan balance of housing loan as of September 30, 2022, June 30, 2023 and September 30, 2023 were overdue more than 180 days. To make the delinquency rate by balance comparable, the Company excludes Xiaoying Housing Loan in the calculation of delinquency rate.

 

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Third Quarter 2023 Financial Highlights

 

(In thousands, except for share and per share data)  Three Months Ended
September 30, 2022
   Three Months Ended
June 30, 2023
   Three Months Ended
September 30, 2023
   QoQ   YoY 
     RMB      RMB      RMB            
Total net revenue   894,617    1,220,422    1,396,864    14.5%   56.1%
Total operating costs and expenses   (594,191)   (775,713)   (962,120)   24.0%   61.9%
Income from operations   300,426    444,709    434,744    (2.2%)   44.7%
Net income   211,724    366,292    347,190    (5.2%)   64.0%
Non-GAAP adjusted net income   231,125    364,885    374,507    2.6%   62.0%
                          
Net income per ADS—basic   3.96    7.62    7.26    (4.7%)   83.3%
Net income per ADS—diluted   3.84    7.50    7.02    (6.4%)   82.8%
                          
Non-GAAP adjusted net income per ADS—basic   4.32    7.62    7.80    2.4%   80.6%
Non-GAAP adjusted net income per ADS—diluted   4.20    7.44    7.56    1.6%   80.0%

 

·Total net revenue in the third quarter of 2023 was RMB1,396.9 million (US$191.5 million), representing an increase of 56.1% from RMB894.6 million in the same period of 2022.

·Income from operations in the third quarter of 2023 was RMB434.7 million (US$59.6 million), compared with RMB300.4 million in the same period of 2022.

·Net income in the third quarter of 2023 was RMB347.2 million (US$47.6 million), compared with RMB211.7 million in the same period of 2022.

·Non-GAAP6 adjusted net income in the third quarter of 2023 was RMB374.5 million (US$51.3 million), compared with RMB231.1 million in the same period of 2022.

·Net income per basic and diluted American depositary share (“ADS”) 7 in the third quarter of 2023 was RMB7.26 (US$1.00) and RMB7.02 (US$0.96), compared with RMB3.96 and RMB3.84, respectively, in the same period of 2022.

·Non-GAAP adjusted net income per basic and adjusted diluted ADS in the third quarter of 2023 was RMB7.80 (US$1.07) and RMB7.56 (US$1.04), compared with RMB4.32 and RMB4.20, respectively, in the same period of 2022.

 

Mr. Justin Tang, the Founder, Chief Executive Officer and Chairman of the Company, commented, “We are pleased to see that our established strategy continued to deliver strong results in the third quarter. Our loan facilitation and origination amount reached the high end of our previous guidance, and both our top line and bottom line showed substantial year-over-year improvement. During the quarter, as macroeconomic conditions improved moderately and the regulatory environment stabilized, the personal finance business has returned to normal across the industry, resulting in increased competition. As a result, our unit borrower acquisition cost increased quarter-over-quarter. Our loan delinquencies fluctuated within their historical low-to-middle range. Going forward, we will continue to execute on our proven strategy and enhance our ability to drive long-term growth and returns for our shareholders.”

 

 

6 The Company uses in this press release the following non-GAAP financial measures: (i) adjusted net income (loss), (ii) adjusted net income (loss) per basic ADS, and (iii) adjusted net income (loss) per diluted ADS, each of which excludes share-based compensation expense, impairment losses on financial investments, income (loss) from financial investments and impairment losses on long-term investments. For more information on non-GAAP financial measure, please see the section of “Use of Non-GAAP Financial Measures Statement” and the table captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release.

7 Each American depositary share (“ADS”) represents six Class A ordinary shares.

 

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Mr. Kent Li, President of the Company, added, “During the third quarter, our total loan amount facilitated and originated increased by 49% year-over-year and 14% quarter-over-quarter to RMB29 billion, with the total outstanding loan balance reaching nearly RMB50 billion at the end of September 2023. Our delinquency rates for all outstanding loans past due for 31-60 days and 91-180 days were 1.11% and 2.50%, respectively, at the end of the quarter, compared with 0.77% and 2.22%, respectively, a year ago. We have enhanced our efforts to acquire more quality borrowers, but we expect the delinquency rates to continue to fluctuate for some time. We will maintain healthy asset quality leveraging our cutting-edge risk management system and focusing more on asset quality than on expanding the borrower base.”

 

Mr. Frank Fuya Zheng, Chief Financial Officer of the Company, added, “We are very pleased with our solid financial results in the third quarter. Total net revenue increased by 56% year-over-year and 14.5% quarter-over-quarter to RMB1,397 million. While our net income saw a remarkable 64% year-over-year increase to RMB347 million, there was a slight decline quarter-over-quarter. This decrease was primarily attributed to the rising costs of borrower acquisition and managing asset quality risks. We remain dedicated to achieving balanced growth in revenue and earnings in the long term, which is clearly a key driver of shareholder value. To achieve this goal, we will take a comprehensive consideration of borrower acquisition costs and risk control based on close monitoring of market dynamics, to ensure that we grow both our revenue scale and profits in a sustainable manner.”

 

Third Quarter 2023 Financial Results

 

Total net revenue in the third quarter of 2023 increased by 56.1% to RMB1,396.9 million (US$191.5 million) from RMB894.6 million in the same period of 2022, primarily due to an increase in the total loan amount facilitated and originated this quarter compared with the same period of 2022.

 

   Three Months Ended September 30,     
(In thousands, except for share and per share data)  2022   2023   YoY 
   RMB   % of Revenue   RMB   % of Revenue     
Loan facilitation service   501,972    56.1%   829,385    59.4%   65.2%
Post-origination service   96,026    10.7%   168,186    12.0%   75.1%
Financing income   251,607    28.1%   300,950    21.5%   19.6%
Other revenue   45,012    5.1%   98,343    7.1%   118.5%
Total net revenue   894,617    100.0%   1,396,864    100.0%   56.1%

 

Loan facilitation service fees in the third quarter of 2023 increased by 65.2% to RMB829.4 million (US$113.7 million) from RMB502.0 million in the same period of 2022, primarily due to an increase in the total loan amount facilitated this quarter compared with the same period of 2022.

 

Post-origination service fees in the third quarter of 2023 increased by 75.1% to RMB168.2 million (US$23.1 million) from RMB96.0 million in the same period of 2022, primarily due to the cumulative effect of increased volume of loans facilitated in the previous quarters. Revenues from post-origination services are recognized on a straight-line basis over the term of the underlying loans as the services are being provided.

 

Financing income in the third quarter of 2023 increased by 19.6% to RMB301.0 million (US$41.2 million) from RMB251.6 million in the same period of 2022, primarily due to an increase in average loan balances compared with the same period of 2022.

 

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Other revenue in the third quarter of 2023 increased by 118.5% to RMB98.3 million (US$13.5 million), compared with RMB45.0 million in the same period of 2022, primarily due to an increase in referral service fee for introducing borrowers to other platforms.

 

Origination and servicing expenses in the third quarter of 2023 increased by 50.1% to RMB811.1 million (US$111.2 million) from RMB540.5 million in the same period of 2022, primarily due to the increase in borrower acquisition cost and collection expenses resulting from the increased in total loan amount facilitated and originated this quarter compared with the same period of 2022.

 

Provision for loans receivable in the third quarter of 2023 was RMB53.9 million (US$7.4 million), compared with RMB17.2 million in the same period of 2022, primarily due to an increase in loans receivable held by the Company as a result of the increase in total loan amount facilitated and originated this quarter compared with the same period of 2022.

 

Income from operations in the third quarter of 2023 was RMB434.7 million (US$59.6 million), compared with RMB300.4 million in the same period of 2022.

 

Income before income taxes and gain (loss) from equity in affiliates in the third quarter of 2023 was RMB417.5 million (US$57.2 million), compared with RMB302.9 million in the same period of 2022.

 

Income tax expense in the third quarter of 2023 was RMB74.2 million (US$10.2 million), compared with RMB91.1 million in the same period of 2022.

 

Net income in the third quarter of 2023 was RMB347.2 million (US$47.6 million), compared with RMB211.7 million in the same period of 2022.

 

Non-GAAP adjusted net income in the third quarter of 2023 was RMB374.5 million (US$51.3 million), compared with RMB231.1 million in the same period of 2022.

 

Net income per basic and diluted ADS in the third quarter of 2023 was RMB7.26 (US$1.00), and RMB7.02 (US$0.96), compared with RMB3.96 and RMB3.84, respectively, in the same period of 2022.

 

Non-GAAP adjusted net income per basic and diluted ADS in the third quarter of 2023 was RMB7.80 (US$1.07), and RMB7.56 (US$1.04), compared with RMB4.32 and RMB4.20 respectively, in the same period of 2022.

 

Cash and cash equivalents was RMB1,427.9 million (US$195.7 million) as of September 30, 2023, compared with RMB1,320.4 million as of June 30, 2023.

 

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Recent Development

 

Share Repurchase Plan

 

In the third quarter of 2023, the Company repurchased an aggregate of 395,962 ADSs for a total consideration of US$1.73 million. Since the beginning of 2023, the Company had repurchased an aggregate of 801,807 ADSs for a total consideration of US$3.31 million. The Company has approximately US$5.6 million remaining for potential repurchases under our current plan.

 

Changes to the Board and management

 

The Board of Directors (the “Board”) has approved the following changes to the Board and management, effective as of the date of this announcement:

 

Mr. Shaoyong (Simon) Cheng resigned as Vice Chairman while remaining as a Non-Executive Director of the Board.

 

Mr. Kan (Kent) Li resigned as Chief Risk Officer and continues to serve as President and Director of the Board.

 

Mr. Yufan Jiang, who joined X Financial in 2015, was appointed as Chief Risk Officer.

 

Mr. Ding (Gardon) Gao resigned as Chief Technology Officer.

 

Business Outlook

 

The Company expects the total loan amount facilitated and originated for the fourth quarter of 2023 to be between RMB26.5 billion and RMB28.0 billion. The total loan amount facilitated and originated for 2023 is expected to be between RMB105.9 billion and RMB107.4 billion.

 

This forecast reflects the Company’s current and preliminary views, which are subject to changes.

 

Conference Call

 

X Financial’s management team will host an earnings conference call at 9:00 PM U.S. Eastern Time on November 22, 2023 (10:00 AM Beijing / Hong Kong Time on November 23, 2023).

 

Dial-in details for the earnings conference call are as follows:

 

United States: 1-888-346-8982
Hong Kong: 852-301-84992
Mainland China: 4001-201203
International: 1-412-902-4272
Passcode: X Financial

 

Please dial in ten minutes before the call is scheduled to begin and provide the passcode to join the call.

 

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A replay of the conference call may be accessed by phone at the following numbers until November 29, 2023:

 

United States: 1-877-344-7529
International: 1-412-317-0088
Passcode: 2808165

 

Additionally, a live and archived webcast of the conference call will be available at http://ir.xiaoyinggroup.com.

 

About X Financial

 

X Financial (NYSE: XYF) (the "Company") is a leading online personal finance company in China. The Company is committed to connecting borrowers on its platform with its institutional funding partners. With its proprietary big data-driven technology, the Company has established strategic partnerships with financial institutions across multiple areas of its business operations, enabling it to facilitate and originate loans to prime borrowers under a risk assessment and control system.

 

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

 

Use of Non-GAAP Financial Measures Statement

 

In evaluating our business, we consider and use non-GAAP measures as supplemental measures to review and assess our operating performance. We present the non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. We believe that the use of the non-GAAP financial measures facilitates investors’ assessment of our operating performance and help investors to identify underlying trends in our business that could otherwise be distorted by the effect of certain income or expenses that we include in income (loss) from operations and net income (loss). We also believe that the non-GAAP measures provide useful information about our core operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making.

 

We use in this press release the following non-GAAP financial measures: (i) adjusted net income, (ii) adjusted net income per basic ADS, and (iii) adjusted net income per diluted ADS, each of which excludes share-based compensation expense, impairment losses on financial investments, income (loss) from financial investments and impairment losses on long-term investments. These non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, investors should not consider them in isolation, or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP.

 

We mitigate these limitations by reconciling the non-GAAP financial measures to the most directly comparable U.S. GAAP financial measures, 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.

 

For more information on these non-GAAP financial measures, please see the table captioned “Reconciliations of GAAP and Non-GAAP results” set forth at the end of this press release.

 

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Exchange Rate Information

 

This announcement contains translations of certain RMB amounts into U.S. dollars at 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 RMB7.2960 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, 2023.

 

Disclaimer

 

Safe Harbor Statement

 

This announcement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "potential," "continue," "ongoing," "targets," "guidance" and similar statements. The Company 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. Any statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements that involve factors, risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors and risks include, but not limited to the followings: the Company’s goals and strategies; its future business development, financial condition and results of operations; the expected growth of the credit industry, and marketplace lending in particular, in China; the demand for and market acceptance of its marketplace’s products and services; its ability to attract and retain borrowers and investors on its marketplace; its relationships with its strategic cooperation partners; competition in its industry; and relevant government policies and regulations relating to the corporate structure, business and industry. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this announcement is current as of the date of this announcement, and the Company does not undertake any obligation to update such information, except as required under applicable law.

 

Use of Projections

 

This announcement also contains certain financial forecasts (or guidance) with respect to the Company’s projected financial results. The Company’s independent auditors have not audited, reviewed, compiled or performed any procedures with respect to the projections or guidance for the purpose of their inclusion in this announcement, and accordingly, they did not express an opinion or provide any other form assurance with respect thereto for the purpose of this announcement. This guidance should not be relied upon as being necessarily indicative of future results. The assumptions and estimates underlying the prospective financial information are inherently uncertain and are subject to a wide variety of significant business, economic and competitive risks and uncertainties that could actual results to differ materially from those contained in the prospective financial information. Accordingly, there can be no assurance that the prospective results are indicative of the future performance of the Company, or that actual results will not diff materially from those set forth in the prospective financial information. Inclusion of the prospective financial information in this announcement should not be regarded as a representation by any person that the results contained in the prospective financial information will actually be achieved. You should review this information together with the Company’s historical information.

 

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For more information, please contact:

 

X Financial

Mr. Frank Fuya Zheng

E-mail: ir@xiaoying.com

 

Christensen IR

 

In China

Mr. Eric Yuan

Phone: +86-10-5900-1548

E-mail: eric.yuan@christensencomms.com

 

In US

Ms. Linda Bergkamp

Phone: +1-480-614-3004

Email: linda.bergkamp@christensencomms.com

 

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X Financial

Unaudited Condensed Consolidated Balance Sheets

 

(In thousands, except for share and per share data)  As of December 31, 2022   As of September 30, 2023   As of September 30, 2023 
    RMB     RMB    USD 
ASSETS               
Cash and cash equivalents   602,271    1,427,862    195,705 
Restricted cash   404,689    599,701    82,196 
Accounts receivable and contract assets, net   1,161,912    1,740,978    238,621 
Loans receivable from Xiaoying Credit Loans and other loans, net   3,810,393    4,522,614    619,876 
Loans at fair value   120,280    -    - 
Deposits to institutional cooperators, net   1,770,317    1,828,885    250,670 
Prepaid expenses and other current assets, net   71,082    27,827    3,814 
Deferred tax assets, net   88,428    118,172    16,197 
Long-term investments   495,995    522,410    71,602 
Property and equipment, net   5,861    8,549    1,172 
Intangible assets, net   36,550    36,512    5,004 
Loan receivable from Xiaoying Housing Loans, net   10,061    9,865    1,352 
Financial investments   192,620    259,066    35,508 
Other non-current assets   67,204    58,811    8,061 
TOTAL ASSETS   8,837,663    11,161,252    1,529,778 
                
LIABILITIES               
Payable to investors and institutional funding partners at amortized cost   2,627,910    3,229,839    442,686 
Payable to investors at fair value   141,289    -    - 
Guarantee liabilities   -    41,146    5,640 
Financial guarantee derivative   107,890    -    - 
Short-term borrowings   70,209    557,500    76,412 
Accrued payroll and welfare   63,681    71,090    9,744 
Other tax payable   255,691    291,138    39,905 
Income tax payable   270,089    408,670    56,013 
Deposit payable to channel cooperators   19,700    19,700    2,700 
Accrued expenses and other current liabilities   476,035    681,834    93,453 
Dividend payable   -    58,693    8,045 
Other non-current liabilities   51,193    41,370    5,670 
Deferred tax liabilities   722    42,818    5,869 
TOTAL LIABILITIES   4,084,409    5,443,798    746,137 
                
Commitments and Contingencies               
Equity:               
Common shares   207    207    28 
Treasury stock   (124,597)   (131,551)   (18,031)
Additional paid-in capital   3,191,194    3,209,546    439,905 
Retained earnings   1,622,851    2,561,984    351,149 
Other comprehensive income   63,599    77,268    10,590 
Total X Financial shareholders' equity   4,753,254    5,717,454    783,641 
Non-controlling interests   -    -    - 
TOTAL EQUITY   4,753,254    5,717,454    783,641 
                
TOTAL LIABILITIES AND EQUITY   8,837,663    11,161,252    1,529,778 

 

 

 

X Financial

Unaudited Condensed Consolidated Statements of Comprehensive Income

 

   Three Months Ended September 30,   Nine Months Ended September 30, 
(In thousands, except for share and per share data)  2022   2023   2023   2022   2023   2023 
   RMB   RMB   USD   RMB   RMB   USD 
Net revenues                              
Loan facilitation service   501,972    829,385    113,677    1,482,206    2,125,492    291,323 
Post-origination service   96,026    168,186    23,052    265,673    429,775    58,906 
Financing income   251,607    300,950    41,249    717,638    829,645    113,712 
Other revenue   45,012    98,343    13,479    141,791    237,308    32,526 
Total net revenue   894,617    1,396,864    191,457    2,607,308    3,622,220    496,467 
                               
Operating costs and expenses:                              
Origination and servicing   540,451    811,078    111,167    1,538,011    2,114,607    289,831 
General and administrative   42,590    48,588    6,660    129,078    138,373    18,966 
Sales and marketing   3,726    3,360    461    12,952    8,828    1,210 
(Reversal of) provision for accounts receivable and contract assets   (4,385)   3,748    514    47,386    5,983    820 
Provision for loans receivable   17,216    53,946    7,394    83,180    129,772    17,787 
(Reversal of) provision for contingent guarantee liabilities   -    41,594    5,701    (14,000)   41,594    5,701 
(Reversal of) provision for credit losses on deposits to institutional cooperators   (5,407)   (194)   (27)   3,127    (427)   (59)
Reversal of provision for credit losses for other financial assets   -    -    -    (765)   -    - 
Total operating costs and expenses   594,191    962,120    131,870    1,798,969    2,438,730    334,256 
                               
Income from operations   300,426    434,744    59,587    808,339    1,183,490    162,211 
Interest income (expenses), net   643    (7,322)   (1,004)   3,359    (17,778)   (2,437)
Foreign exchange gain (loss)   (13,991)   1,526    209    (26,137)   (7,255)   (994)
Income (loss) from financial investments   1,823    (16,490)   (2,260)   (7,802)   (13,911)   (1,907)
Impairment losses on financial investments   (8,875)   -    -    (8,875)   -    - 
Fair value adjustments related to Consolidated Trusts   (4,886)   268    37    (6,377)   (531)   (73)
Change in fair value of financial guarantee derivative   21,649    -    -    46,274    24,966    3,422 
Other income, net   6,106    4,742    650    32,134    23,005    3,153 
                               
Income before income taxes and gain (loss) from equity in affiliates   302,895    417,468    57,219    840,915    1,191,986    163,375 
                               
Income tax expense   (91,104)   (74,172)   (10,166)   (314,380)   (213,779)   (29,301)
Gain (loss) from equity in affiliates, net of tax   (67)   3,894    534    10,821    19,619    2,689 
Net income   211,724    347,190    47,587    537,356    997,826    136,763 
Less: net income attributable to non-controlling interests   -    -    -    -    -    - 
Net income attributable to X Financial shareholders   211,724    347,190    47,587    537,356    997,826    136,763 
                               
Net income   211,724    347,190    47,587    537,356    997,826    136,763 
Other comprehensive income, net of tax of nil:                              
Gain from equity in affiliates   96    4    1    166    45    6 
Foreign currency translation adjustments   37,254    (6,301)   (864)   69,971    13,624    1,867 
Comprehensive income   249,074    340,893    46,724    607,493    1,011,495    138,636 
Less: comprehensive income attributable to non-controlling interests   -    -    -    -    -    - 
Comprehensive income attributable to X Financial shareholders   249,074    340,893    46,724    607,493    1,011,495    138,636 
                               
Net income per share—basic   0.66    1.21    0.17    1.64    3.47    0.48 
Net income per share—diluted   0.64    1.17    0.16    1.60    3.43    0.47 
                               
Net income per ADS—basic   3.96    7.26    1.00    9.84    20.82    2.85 
Net income per ADS—diluted   3.84    7.02    0.96    9.60    20.58    2.82 
                               
Weighted average number of ordinary shares outstanding—basic   321,742,209    287,806,370    287,806,370    328,467,902    287,412,729    287,412,729 
Weighted average number of ordinary shares outstanding—diluted   328,981,034    297,114,127    297,114,127    335,706,728    291,209,263    291,209,263 

 

 

 

X Financial

Unaudited Reconciliations of GAAP and Non-GAAP Results

 

   Three Months Ended September 30,   Nine Months Ended September 30, 
(In thousands, except for share and per share data)  2022   2023   2023   2022   2023   2023 
   RMB   RMB   USD   RMB   RMB   USD 
GAAP net income   211,724    347,190    47,587    537,356    997,826    136,763 
Less: Income (loss) from financial investments (net of tax of nil)   1,823    (16,490)   (2,260)   (7,802)   (13,911)   (1,907)
Less: Impairment losses on financial investments (net of tax of nil)   (8,875)   -    -    (8,875)   -    - 
Less: Impairment losses on long-term investments (net of tax)   -    -    -    -    -    - 
Add: Share-based compensation expenses (net of tax of nil)   12,349    10,827    1,484    41,686    34,178    4,684 
Non-GAAP adjusted net income   231,125    374,507    51,331    595,719    1,045,915    143,354 
                               
Non-GAAP adjusted net income per share—basic   0.72    1.30    0.18    1.81    3.64    0.50 
Non-GAAP adjusted net income per share—diluted   0.70    1.26    0.17    1.77    3.59    0.49 
                               
Non-GAAP adjusted net income per ADS—basic   4.32    7.80    1.07    10.86    21.84    2.99 
Non-GAAP adjusted net income per ADS—diluted   4.20    7.56    1.04    10.62    21.54    2.95 
                               
Weighted average number of ordinary shares outstanding—basic   321,742,209    287,806,370    287,806,370    328,467,902    287,412,729    287,412,729 
Weighted average number of ordinary shares outstanding—diluted   328,981,034    297,114,127    297,114,127    335,706,728    291,209,263    291,209,263 

 

 


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