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spk03: Good day ladies and gentlemen, thank you for standing by and welcome to the GIINX Group's fourth quarter 2023 earnings conference call. Currently all participants are in listen-only mode. Later we will conduct a question and answer session and instructions will follow at that time. As a reminder we are recording today's call. If you have any objections you may disconnect at this time. I would like to turn the call over to Mr. Shawn Zhang from Investor Relations of Jiayin Group. Please proceed.
spk05: Thank you, operator. Hello, everyone. Thank you all for joining us on today's conference call to discuss Jiayin Group's financial results for the fourth quarter and the full year of 2023. We released our earnings results earlier today. The press release is available on the company's website as well as from Newsware Services. On the call with me today are Mr. Yan Jinggui, Chief Executive Officer, Mr. Fan Chunlin, Chief Financial Officer, and Ms. Xu Yifeng, Chief Risk Officer. Before we continue, please note that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Security Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's actual results may be materially different from the expectations expressed today. Further information regarding these and other risks and uncertainties is included in the company's public filings with the SEC. The company does not assume any obligation to update any forward-looking statement except as required under application law. Also, please note that unless otherwise stated, all speakers mentioned during the conference call are in Chinese. With that, let me now turn the call over to our CEO, Mr. Yan Ding Gui. Mr. Yan will deliver his remarks in Chinese, and I will follow up with corresponding English translations. Please go ahead, Mr. Yan.
spk07: Hello, everyone. Thank you all for attending the 4th Group and the Year-Round E-Call Conference in 2023.
spk05: Hello, everyone. Thank you for joining our fourth quarter and full year 2023 Earnings Conference Call. 2023 is a very important turning point for Jiayin.
spk07: The changes in the macroeconomic environment have increased the challenges faced by the company, and on the other hand, provided rare opportunities for development. What we would like to share with you is that in the fourth quarter and the whole year of 2023, Jiayin firmly implemented various strategies to achieve a bright future in finance and business.
spk05: The year of 2023 was a pivotal year for our company, with the changing macroeconomic landscape amplifying our challenges, but also opening up unique opportunities for groups. We are thrilled to share that throughout the fourth quarter and the entire year, We firmly executed our strategic initiatives, achieving remarkable results on both financial and operational fronts. The execution of these strategies will form the core competitive edge for our company's future growth.
spk07: In the face of several years of pandemic and global conflict, the recovery time of the macroeconomic economy has been extended, and the difficulty has also been improved. Maintaining a stable and strictly controlled risk of potential disaster has become an important factor in policy decision-making and decision-making. On the other hand, the development of strategic new industries and the importance of world-wide demand have been further expanded. Adjusting the economic development structure, transforming and upgrading the dynamic of economic development has become the main issue of economic development.
spk05: Reflecting on 2023, the key words for China's macroeconomic scene were steady growth and structural adjustment. On the one hand, the recovery of the economy at the macro level faced extended timelines and increased difficulties due to the ongoing multi-year impact of COVID and escalating geopolitical conflicts worldwide. Maintaining steady growth while strictly controlling potential risks became a critical consideration for policymakers. On the other hand, the importance of developing industries that are both strategic and emerging as well as stimulating domestic demand became even more pronounced. Adjusting the structure of economic development and focusing on transforming and upgrading the engines of growth emerged as primary discussions. Particularly from the fourth quarter onwards, new quality productive forces started to gain traction as a popular concept.
spk07: We continue to pay attention to the important changes in the financial and technology industries in the cross-border economy, and continue to focus on the technology innovation and risk management core capabilities of the company. At the same time as actively expanding the market share of the company, we have improved the level of the company's elite operation, and have fully completed the company's elite goals. The company is paying attention to the relative speed of economic recovery, relative smoothness, and the trend of the rise in the overall risk level of the industry, and has implemented more comprehensive risk management tools. In the fourth quarter, the company's total trading volume reached 2.01 billion yuan, which increased by 6.3%. At the same time, the annual total trading volume reached 88.1 billion yuan, which increased by 58.7% compared to 2022, exceeding the previously set target. The total size reached the company's historical height. In the fourth quarter, the company achieved a revenue of 16 billion yuan. In 2023, we kept a close watch on significant changes within the macroeconomic landscape, particularly in the financial and technology sectors.
spk05: we remain focused on our core competencies of technological innovation and risk management. We did this while striving to enhance our company's market share and improve our precision in operations, thereby successfully meeting our business objectives. In the fourth quarter, the company's loan facilitation volume was 20.1 billion RMB. an increase of 6.3% year over year. Meanwhile, the company's total loan facilitation volume for the full year reached 88.1 billion RMB, an increase of 58.7% compared to 2022, surpassing the previously set target guidelines and achieving a new historical high in volume. In the fourth quarter, The company achieved net revenue of 1.6 billion RMB and increase of 51.8% year-over-year. Annual net revenue reached 5.47 billion RMB and increase of 67.1% year-over-year, continuing healthy growth momentum. 宏觀經濟的恢復離不開現代服務的知識
spk07: In the whole year of 2023, the demand for China's market consumption has maintained a steady growth. The State Council's Office on the Promotion and Release of Consumption Priority and Suggestions for Consumption Continuous Restoration, the National Development Commission on the Restoration and Expansion of Consumption, the Financial Supervisory Board on Financial Support for the Restoration and Expansion of Consumption Notifications, and the State Council on the Promotion of the Implementation of High-Quality Financial Development, etc. have effectively promoted the growth of the consumer market. At the same time, the national level has also proposed new requirements for the improvement of the service quality of standardized financial institutions. At the end of 2023, the data of the People's Bank of China showed that the loan amount of the various financial institutions of the People's Bank of China was 237.59 trillion yuan, which increased by 10.6% in the same year. The loan amount of the People's Bank of China increased by 22.75 trillion yuan in the same year, which increased by 1.31 trillion yuan in the same year. In the context of the continued improvement of market demand,
spk05: the recovery of the macro economy is closely linked to the support of credit services. And in 2023, the demand for consumer credit services in the Chinese market remain robust. Policies and measures such as the opinions of the general office of the State Council on further unleashing the potential of consumer spending and promoting the sustained recovery of consumption, the National Development and Reform Commission's effort for restoring and expanding consumption, and National Financial Regulatory Administration's notice on the financial support for recovery and expansion of consumption, and State Council's initiatives to further facilitate the high-quality development of inclusive finance, each contributed to the growth of the consumer credit service market. Additionally, new requirements were introduced at the national level to regulate financial institutions and enhance service quality. At the end of 2023, according to data from the People's Bank of China, the balance of various types of RMB loans from financial institutions amounted to 337.59 trillion RMB, an increase of 10.6% year-over-year. Through the year, RMB loans increased by 22.75 trillion RMB, an additional 1.31 trillion RMB compared with the previous year. Against the backdrop of the continuously increasing market demand, we are continuing to focus on optimizing customer structure, pursuing sustainable growth in business scale.
spk07: This is not only the company's strategic strategy to increase technology to the highest priority level, but also to adapt the company to the development trend of AI as a representative of pre-technology applications in various business products. As of now, AI technology capabilities include anti-fraud monitoring, head-on model of sales and customer service, and customer service service intelligence inspection, and so on, to help the company improve control capability, improve customer efficiency, and customer service satisfaction and reliability. In the fourth quarter of 2023, 2023 was the year of transformation for our company.
spk05: in terms of technological empowerment, especially in the development and application of artificial intelligence technology. In the third quarter, our company officially changed its name to Jiayin Technology, marking a strategic shift where technology took top priority. This move aligns with the trend of applying AI in various business scenarios. AI technology has empowered us in areas like anti-fault monitoring, marketing borrower acquisition models, and intelligent quality inspection for customer service. These advancements have boosted our risk control capabilities, improved borrower acquisition efficiency, and enhanced customer satisfaction and compliance. In the fourth quarter of 2023, we combined large language models and AIGC technology to enhance our innovation and influence through automated high quality image and video content creation. Internally, we're developing intelligent office tools leveraging open source large language models for better operational efficiency in the middle and back office.
spk07: As of the end of 2023, we have established cooperation with 71 financial institutions, and we are in the process of negotiating with 36 other financial institutions. We have cooperated with financial institutions in the areas of operation, technology, risk management, and consumer protection in all areas, and have actively expanded and innovated our cooperation with them, which has led to a continuous increase in market competitiveness. Among our key partners, we have completed the introduction of one Internet bank in the fourth quarter, two large-scale commercial banks, and multiple private banks, By the end of 2023, we had partnership with
spk05: 71 financial institutions, and we're in talks with an additional 36. Our collaboration with this institution covers operation, technology, risk management, and customer rights protection, enhancing our market competitiveness. In the fourth quarter, we welcome one internet bank, two tier one city commercial banks, and several private banks as partners. diversifying our funding. This led to significant growth in our loan facilitation business throughout the year. We believe our expanding ecosystem of partners will be crucial for our long-term growth. 公司2023年第四季度在平衡風險波動和拓展新客戶方面也持續發力。
spk07: At present, continuous optimization of the structure of borrowers to respond to risk fluctuations and guarantee the importance of asset quality. UCI's 90-day forecast strength is maintained at a level of 0.68%, which is generally out of the reach of the public. In the future, Jiayin will continue to carry out a flexible and agile wind and air strategy. In terms of new customers' acquisition, the company continues to carry out a more stable customer strategy, with a wide range of customer evidence, and it has achieved excellent results in terms of cost control. Through a sophisticated investment strategy, elimination adjustment of long-range channels, and the improvement of the transfer rate, the sales cost of the fourth quarter of 2023 decreased by 11.9% in the same ratio. In terms of customer operation, through a sophisticated management, the life cycle value of core assets was deepened, and the repeat loan ratio reached 72.9%. The total loan amount was 9944 billion yuan,
spk05: In the fourth quarter of 2023, the company continues efforts in managing risk fluctuations and expanding its forward base. We understand the importance of optimizing customer structure and ensure asset quality amid market changes. The delinquency rate for 61 to 90 days remained at 0.68%, manageable overall. Going forward, Jiaying will maintain prudent and flexible risk control strategies. For new borrower acquisition, we pursued a stable strategy focusing on existing multi-channel borrower acquisition metrics and achieved success in cost control. This led to an 11.9% reduction in Q4 2023 sales and marketing expense compared to the same period of last year. In borrower operations through refined management, we deeply explored the lifetime value of core assets. Our repeat borrowing rate reached 72.9%. average borrowing amount per borrower of 9,944 RMB. The company's overseas business layout is also steadily advancing.
spk07: In the Lilliania region, we have noticed that the current local exchange rate fluctuation and market risk level fluctuation still exist. The breakthrough in business size will be a general challenge. We will continue to pay attention to the development trend of the local business environment to make the next step. At the same time, we are also actively looking for opportunities in the African market, which has potential in Tanzania and others. Indonesia is another market that we focus on. At the end of 2023, the Indonesian regulatory body issued a new regulatory policy and proposed new requirements for reducing the rate. Market regulation must be strict. We are closely monitoring this situation and plan to pass The company's expansion into overseas market is progressing steadily. In Nigeria, we are mindful of the ongoing fluctuations in local exchange rates and market risks.
spk05: which may pose challenges to further growth. We will continue to monitor the local business environment closely and make informed decisions accordingly. Meanwhile, in the promising pan-African market like Tanzania, we are actively exploring expansion opportunities. Indonesia is also a key market of interest. By the end of 2023, Indonesian regulatory authorities have introduced new policies requiring lower rates and a tighter market oversight. We are closely monitoring these developments and plan to support our partner to optimizing their asset structures and targeting high-quality forward segments. Additionally, we are keeping a close eye on Latin American market, including Mexico, for potential business development opportunities.
spk07: In the four seasons and the whole year of 2023, consumer protection work has become the mainstay of the development of Guantan family. We actively respond to the pattern of large-scale protection work and firmly defend consumer rights. We fully implement the digital technology advantage of the company, and implement a professional operation strategy to build a comprehensive and secure consumer protection system. to maintain the technology, and to build anti-abortion anti-fire walls, and to create a harmonious and stable consumer environment. In this year's White Paper of Xiaobao released in January 2023, we have described in detail the meaningful work results and the profound movements of the industry. Among them, Xiaobao has 26 million people in publicity coverage, and 9900 wide-ranging customers. The company is even more successful
spk05: Throughout the fourth quarter and the full year 2023, consumer rights protection remained a central focus for Giant's development. We actively responded to the customer rights protection initiative, defending consumer rights with determination, leveraging our digital technology advantages We implemented lean operational strategies internally and established a robust consumer rights protection system. Externally, we continue to empower our business with technology, building a strong antifog firewall to foster a harmonious and stable consumer environment. In the 2023 Consumer Rights Protection White Paper released in January, we detailed our achievements and deep industry insights. This included educating 26 million individuals on consumer protection and assisting 9,900 borrowers in need. The companies Outstanding performance was recognized with the Best Financial Consumer Rights Protection Award at the Financial Compliance Annual Award Ceremony.
spk07: Looking back at the past year of 2023, we have achieved high-quality growth. This to a certain extent shows the effectiveness of our strategy. At the moment, we are entering a normalization stage with the management of the industry. We expect that the future industry and the environment will be more beneficial to the development of the family business. We believe that by maintaining the core status of technology innovation in the long-term competitiveness of the company, and firmly implementing the strategy of expanding the business scale, optimizing the asset structure, and deepening the cooperation depth of the institutions, as well as monitoring the risk level, we will achieve long-term stable growth in the Chinese market and the international market. Based on our confidence in the performance of the industry in 2024, we will spend the entire year of the year
spk05: Reflecting on 2023, we are pleased to report that we achieved high-quality growth, demonstrating the effectiveness of our strategies. Currently, as industry regulation enters to a normalized stage, it is expected that the future industry environment will be more conductive to giant sustained development. We also made significant strides in technology enabled business operations and in expanding our overseas footprint. We are convinced that maintaining a focus on technological innovation as a cornerstone of our long-term competitive strategy Along with our commitment to expanding our business scale, optimizing our asset structure, and originally managing risk, we'll ensure our continued and stable growth in both Chinese and international markets. We are confident in our company's performance in 2024, setting a goal for total loan facilitation to be ranked from 93 billion to 98 billion RMB for the year, with 22 billion RMB targeted for the first quarter.
spk07: Finally, I would like to talk about the contribution of the company to the shareholder. In the past nine months, we have issued two cash receipts to the shareholder. The total is 0.8 yuan per ADS. The total sales amount reached $42.7 million, accounting for 25% of the company's net profit in fiscal year 2022. In the future, we will continue to implement the company's sales policy. Under the condition of fulfilling the bonus, it is expected to issue two incentives per year in cash. The total distribution of incentives per year is not lower than 15% of the company's net profit in the previous year. As of now, Finally, I would like to talk about the company's efforts in boosting shareholders' returns.
spk05: Over the past nine months, we have distributed two cash dividends to shareholders, totaling 0.8 USD per ADS. The total dividend amount reached 42.7 million USD, accounting for 25% of the company's net income after tax for the fiscal year of 2022. Going forward, we will continue to execute the company's dividend policy which is to distribute dividends twice a year in cash with an annual total dividend not less than 15% of the previous year's net income after tax, subject to dividend conditions being met. Regarding our share repurchase program, as of now, the company had repurchased its ADS for approximately 10.6 million USD and raised our current effective share repurchase program limit to 13 million USD. We look forward to reaffirming our commitment to creating value for shareholders and our confidence in companies' long-term growth prospects through these measures.
spk07: With that, I will now turn the call over to our CFO, Mr. Fan Chunling.
spk05: Please go ahead.
spk06: Thank you, Mr. Yen, and hello, everyone, for joining our course today. I will now review our financial highlights for the quarter. Please note that all numbers will be in RMB, and all percentage changes refer to year-over-year comparisons, unless otherwise noted. As Mr. Yang mentioned earlier, we carried through our vast growth momentum over the past year to achieve new milestones in the fourth quarter. Notably, our loan facilitation volume grew by 6.3% to $20.1 billion. Our net revenue was about $1.6 billion. up 51.8%. Moving on to costs, facilitation and servicing expenses were $837.2 million, representing an increase of 329.1% from the same period of 2022, primarily due to increased loan facilitation volume and expenses related to financial guarantee services. Allowance for uncollectable receivables, counter assets, loan receivables, and others was $43.8 million, representing an increase of 190.1% from the same period of 2022, primarily due to the increased balances arising from loan facilitation and guarantee services. Sales and marketing expense was $329.5 million, representing a decrease of 11.9% from the same period of 2022, primarily due to lower commission expenses. G&E expenses were $65.2 million, representing an increase of 9.9% from the same period of 2022, primarily driven by an increase in employee costs. R&D expenses were $92.9 million, representing an increase of 44.3% from the same period of 2022, primarily due to the higher employee compensation as a result of an increase in research and development department headcount. Consequently, our net income for the fourth quarter was $367.6 million, representing a decrease of 31.1% from $533.7 million in the same period of 2022. Our basic and diluted net income per share was $1.72, compared to 2.49 in the fourth quarter of 2022. Basic and diluted net income per ADS was 6.88 compared to 9.97 in the fourth quarter of 2022. We ended this quarter with 370.2 million in cash and cash equivalents compared to 180.3 million at the end of the previous quarter. With that, We can open the call for questions. Ms. Xu, our Chief Risk Officer and I will answer your questions. Operator, please proceed.
spk03: Thank you. To ask a question, please press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. As a reminder, please press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. Please stand by while we compile the Q&A roster. This will take a few moments. Once again, please press star 1 and 1 on your telephone and wait for your name to be announced.
spk00: Thank you. We are now going to proceed with our first question.
spk03: And the questions come from the line of Ronghua from Jinyu Asset. Please ask a question. Hello, management.
spk01: I am Huarong, an analyst from Jinyu Asset. I have two questions for the management. First, we can see that whether it is 1 to 30 days, 31 to 60 days, 61 to 90 days, 91 to 190 days, Hello, management. I'm Huarong from Jinyu Asset. I have two questions. The first one is we have observed that the delinquency rates for periods of one to 30 days, 31 to 60 days, 61 to 90 days, 91 to 190 days, and over 180 days are all higher than the level during the same period in 2022. Could you please share what mirrors the company intent to taking the future to keep delinquency rates low. And my second question is, I also have a question about the shareholder return. In 2023, the company initiated dividend distribution. What can we expect for the future dividend policy and payout ratio? Thank you.
spk02: Hello, I am Xu Yifang. I would like to discuss your first question. First of all, as an investor, I would like to thank you for paying attention to the performance of our multi-directional risk indicators. Indeed, compared to 2022, we have seen a rise in climate indicators in various dimensions. Hello, Ms. Hua. Thank you so much for focusing our delinquency rate as our investor.
spk05: Just a callback from what Mr. Yen just said, in 2023 the overall domestic economic environment still faces multiple challenges and uncertainties. And one very certain thing is that the economic recovery speed is still very slow.
spk02: If you follow our discussions in the past few quarters, you will know that since Q2 last year, we have been re-adjusting under the assumption that the economic environment is growing and changing, and how to respond to the measures and measures that need to be taken in terms of risk management under such an economic cycle.
spk05: And if you follow our updates in the past several quarters, you will see that since the second quarter of 2023, we have already adjusted and faced the challenges to risk management given by economic cycles under this perception.
spk02: Under the mechanism of risk assessment, we have strengthened the study of the customer group and the sensitive study of the external environment indicators. We have also accelerated the internal policy to adjust and adapt to the different customer groups and manage the risk indicators in the whole life cycle management process of the customer.
spk05: Also, under a prudent risk decision-making mechanism, we have strengthened our research on the sensitivity of our borer group to external environmental impacts, accelerated the adjustment and the adaptation of internal strategies, and managed risk indicators throughout the whole life cycle of our borrowers.
spk02: One thing I want to point out that in the post-facilitation stage
spk05: we have enhanced the intelligence and experience of repayment, reminder, and collection through technology and models, strengthened the application of mediation and legal collection at different stages, and improved the optimization of risk indicators at each stage, and all under the premise of enhancing borrower operation experience and protecting consumer rights. And those are our measures to the risk control measures under the economic cycle.
spk02: Those are my answers to your first question.
spk05: And I will give it to our CFO, Mr. Fan Chunling, for your second question.
spk06: Thank you for your question. The stock market return is indeed a problem that everyone is concerned about. As Mr. Yan mentioned in his speech, we have made some efforts in this regard. According to the company's rapid development and our document operation in recent years, our operation indicators and financial indicators have shown a trend of continuous improvement overall. Thank you, Ms. Huang. And yeah, it's true that the rewards to our shareholders are very interesting.
spk05: Just as Mr. Yen just said, based on our company's rapid development and robust management over the past few years, both operational and financial indicators have shown a continuous improvement trend. So our company's operating cash flow is relatively abundant, and the metrics on the balance sheet are increasingly solid. Therefore, the company has been and will continue to reward our shareholders through share repurchase plans and dividend policies.
spk06: It has been already two years since we just started our share repurchase plans. But the current stock trading price is around just two. The P ratio is around just two.
spk05: Considering our company's fundamentals and strong profitability, our management believes that the stock price does not fully reflect the company's internal value, which means we are undervalued. So our board of directors just approved an additional 20 million USD share repurchase plan recently, raising the repurchase limit to 30 million USD.
spk06: Over the past year, we have implemented two dividends
spk05: totaling 0.8 USD per ADS. If you calculated based on our closing price yesterday, which is 6.9 USD per ADS, the dividend yield exceeds 11.5 percent. So in the future, we will continue to our established dividend policy and rewarding our shareholders through regular dividends.
spk06: Okay.
spk05: Thank you.
spk03: Thank you. We are now going to proceed with our next question. And the questions come from the line of from HDFC. Please ask a question. Your line is opened.
spk04: Hello, Mr. Guan. Thank you for inviting me to the meeting. I'm Chen Yixuan from Huatai Securities. I have two questions for you. The first question is, considering the uncertainty of the current Hong Kong environment, in terms of goods and services channels and risk control, what are the effective adjustments and improvements? Based on these adjustments and improvements, is there a detailed plan for the development of the company? The second question is, we observed that the net profit of the company in the fourth quarter of 2013 has decreased considerably, and the income of the company has increased more than before. What is the main reason for this? And what is the company's outlook on the net profit this year? Let me do the translation. The first question is, given the uncertainty in the current macroeconomic environment, could you please share what positive and effective adjustments and improvements you have made in the customer acquisition channels and risk control? And also, does the company have a detailed plan for future developments based on these adjustments and improvements? And the second question is, we have noticed a significant
spk02: Okay, Mr. Chen. The first question is about the direction of risk management. I will answer and discuss it with you. Mr. Chen, you mentioned that there is a considerable uncertainty about the public environment. But I also want to review that in the past few years, In the past few years, ZhaYing has had a significant impact on the data accumulation and customer accumulation in the industry for 13 years. As we have seen before, in terms of transaction volume, Okay, Mr. Chen, I will take your first question. So firstly, I would like to remind that in the past few years, the online credit industry has gone through a period of consolidation.
spk05: followed by a slowdown in the economic recovery of the external environment. During this period, we fully leveraged its long accumulated data and users' advantages. With the rapid development of facilitation volume, the risk control indicators has also been satisfactory.
spk02: Today, we will look at the adjustment and improvement needed for the development of the industry. We will emphasize a sustainable long-term development goal, and then let the technology of Jiayin continue to contribute to a financial partner in China and the international market. Therefore, we will carefully consider the health growth of our platform transaction volume under the premise of prosperity and control.
spk05: So today, as we consider the development of our business, we will place more emphasis on a sustainable long-term development goal, continuously empowering our financial partners in both China and international markets with our technological capabilities. So we will prudently consider the healthy growth of the platform's facilitation volume under the premise of controllable risk.
spk02: is still strengthening the management and maintenance of high-quality customers, and increasing the digging and application of customer behavior data. From there, the two directions of high-quality customers and the combination of assets, the combination of customers and the combination of assets, have been improved and improved on the high-quality customer group. In terms of the risk strategy, we talked about some some directions and methods, but on the other hand, we will continue to pay attention to the new data products on the market, some guides and tests, systematized evaluation of external environmental risks, the impact on different customers, and long-term monitoring, strengthening model standby and optimization. On the strategy, to increase customer management, to diversify our pass rate, diversify our pricing, diversify our range management, Finally, in the latter part, in addition to the technical model we have shared before, and the application of law enforcement and regulation, we still use these various strategies and methods to strengthen the client's operating experience and to improve the risk indicators at all stages under the big premise of protection of rights and security.
spk05: So, in detail, firstly, in the term of borrower acquisition channels, we will focus on balancing the channel mix metrics, prioritizing the development of channels that mainly acquire high-quality assets. Secondly, from the service and operational strategy perspective, we will enhance the management and retention of high-quality borrowers increasing the mining and application of borrower behavior data by promoting the elevation of borrower quality and asset portfolios towards high quality borrower groups. So thirdly, in terms of risk strategy, we will continue to focus on the introduction and testing of market data products. systematically assess and monitor the impact of external environment risk on different borrower groups and strengthen the iteration and optimization of our models. Strategically, we will conduct differentiated measurement by different borrower group, implementing differentiated approval rates differentiated pricing and differentiated credit limit measurement. So lastly, in the post-facilitation aspect, as previously mentioned, the introduction of various strategies and methods aimed to enhance the optimization of risk indicator at each stage. So all under the premise of strengthening borrower operation experience and protecting consumer rights.
spk02: So those are some ideas about your first question. And as the same, the second question we'll give to Mr. Fan Chuning.
spk06: In 2024, Q4's net profit was 3.68 billion yuan. Our net profit rate is about 23%. In comparison, Q3 in 2023 is slightly more than 3.24 billion yuan. But compared to Q4 in 2022, it is 31% lower. The main reason is that Q4's net profit rate in 2022 is very high, close to 51%. because of the impact of some unusual events. I remember last time when I was in ER, I also mentioned that the most important thing is that our core operating entities have officially obtained high-tech enterprise capital in Q4 of 2022, and have used 15% of the tax rate. So in Q4 of 2022, the Q4 has made a one-time adjustment to this tax advantage, and this can be traced back to 2021. Okay, thank you Yusheng for your question. So for the fourth quarter of 2023, the net income was 368 million RMB, which is a slight increase compared to RMB
spk05: $324 million in the third quarter of 2023. However, there was a 31% decrease if you compare to the RMB $534 million in the fourth quarter of 2022. And I think there are some main reasons. So firstly, the net margin in the fourth quarter of 2022 was exceptionally high. which is about 51%. So I think we have mentioned in the course before that the primary reason was that several of our core operating entities officially obtained the high-tech enterprise qualification in the fourth quarter of 2022, which adjusted the applicable income tax rate to 15%. and it is retroactive to 2021. Therefore, we made a one-time financial adjustment for this tax benefit in the fourth quarter of 2022. If you exclude this one-time adjustment and other nonrecruiting items, the net income for the fourth quarter of 2022 would be much lower.
spk06: 另外一点就是2023年Q4的营业收入的明显当中, 担保收入占比较2022年Q4是要高一些。 那么这块业务的利润率比我们的导流分控服务要低, 这也会拉低我们的整体的利润率。 但公司从整体业务发展战略的角度来看, 我们将持续聚焦于导流分控服务,
spk05: So in the detailed classification of our revenue of fourth quarter of 2023, the proportion of guarantee income was higher than in the fourth quarter of 2022. And the profit margin of this kind of business is lower than our facilitation and the risk control services. So in the future, I think our listed company will continue to focus on the facilitation and risk control services. And we will also reasonably control the balance of different business segments in our revenue proportion.
spk06: 关于金利润的这个数字呢,我们目前还不会给这个guidance,对吧? 我们目前给的guidance还是关于交易量, 930到980这样的一个区间。 但是如果你们看我们过往的这个, In the past three years, from 2021 to 2023, we have achieved 26.3%, 39.1% and 23.7%. In the future, we will continue to maintain the document operation, and our take rate will remain stable. We will continue to increase the investment in technology and research, and increase the efficiency of operation, so that our overall profit rate will remain at a healthy level.
spk05: So regarding the income statement figures, we are not going to provide any guidance today. But we have already given a range for our facilitation volume this year, which is $93 to $98 billion. If you look at our net margin in certain quarters in the past has fluctuated due to some non-recruiting items. Annually, our net margins for the past three years which is 2021 to 2023 were 26.3%, 36.1%, and 23.7% respectively. And also in the future, we will continue to operate steadily, maintain a stable take rate, increase investment in R&D and improve operational efficiency to keep the overall margin at a very healthy level.
spk06: 关于宇轩问到的就是应收账款同比增加的这个问题。 是的,我们2023年Q4的这个应收账款预额跟2022年Q4同比增加比较多。 那这个主要是源于这个我营业收入的这个显著的一个增加。 And yes, if you compare with the current receivables in the Q4 2023 to the Q4 2022,
spk05: there is a difference just as what you said. But if you compare the balance at the end of the fourth quarter compared with the end of the third quarter, the balance was roughly flat and a little bit decreased. So our company's balance sheet will continue to improve.
spk06: Thank you, Mr. Chen.
spk05: All right, thank you, Yuxuan, for your question.
spk03: Thank you. Seeing no more questions now, I would like to return the call to Shawn for closing remarks. Please go ahead.
spk05: Okay, thank you, operator, and thank you all for participating on today's call, and thank you for your support. We appreciate your interest and look forward to reporting to you again next quarter on our progress.
spk03: Thank you all again. This concludes the call. You may now disconnect. Thank you.
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