FinVolution Group

Ladies and gentlemen, thank you for participating in the second quarter 2024 earnings conference call for Zinvolution Group. At this time, all participants are in listen-only mode. After management's prepared remarks, there will be a question and answer session. Today's conference call is being recorded. I would now like to turn the call over to your host, Demetan. Head of Investor Relations for the company. Jimmy, please go ahead.

Thank you, Alison. Hello, everyone, and welcome to our second quarter 2024 earnings conference call. The company results were issued via newswire services earlier today and are posted online. You can download the earnings release and sign up for the company email alerts by visiting the IRR section of our website at irr.finvigroup.com. Mr. Tianjin Li, our Chief Executive Officer, and Mr. Jia Yuan Xu, our Chief Financial Officer, will start the call with their prepared remarks and conclude with a Q&A session. During this call, we will be referring to several non-GAAP financial measures to review and assess our operating performance. These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with US GAAP. For information about these non-GAAP measures and reconciliation to GAAP measures, please refer to our earnings press release. 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 Securities Litigation Reform Act of 1995, forward-looking statements involved inherent risks and uncertainties. As such, the company results may be materially different from the views expressed today. Further information regarding this and other risks and uncertainties are included in the company filings with the U.S. Securities and Exchange Commission. The company does not assume any obligation to update any forward-looking statements except as required under applicable law. Finally, we post a slide presentation on the IR website providing details of our results for the quarter. I will now turn the call over to our CEO, Mr. Tianjun Li. Please go ahead, sir.

Thanks, Jamie. Hello, everyone. and thank you for joining our earnings call. This is Teo-Chun Li, CEO of Involution Group. We are happy to speak with you today. We ended the first half of 2024 on a positive note, driving progress growth in the China market while maintaining our rapid growth momentum internationally. So determine strong execution of our local excellence global outlook strategy of Simply Legal Strategy. We made great strides across our business in the markets in which we operate. Cumulatively, we have served around 31.5 million borrowers across China, Indonesia, and the Philippines as of June 30, 2024. During the first half of 2024, transaction volume for the China market reached 92.5 billion RMB up 6% year-over-year. Transaction volume for international market continued to grow rapidly, soaring to 4.5 billion RMB, up 32% year-over-year. In terms of outstanding balance, China reached 64.2 billion RMB, while our international market rose to 1.4 billion RMB, up 3% and 27% respectively year-over-year. This standard performance stands out as a testament to the effective execution of our legal strategy and the unwavering commitment of our team. Customer acquisition is a key element of our legal strategy. We view it as an ongoing investment that will ultimately lead to a higher percentage of better quality repeat borrowers and drive sustainable growth. During the second quarter, Our number of total new borrowers reached 823,000, up 22% year-over-year and 15% sequentially, validating our ability to grow our business across different countries, notably as we completed the transition to better quality borrowers in Indonesia and began to diversify our business model. The percentage of new international borrowers once again surpass the percentage of new China borrowers. Furthermore, our number of new borrowers in the Philippines continue to grow robustly in the second quarter, increasing by 198% year-over-year and 69% sequentially. Our effective social media strategy in the international markets also continue to yield positive As of the end of the second quarter, our followers on leading social media platforms such as Facebook, TikTok and Instagram had risen to approximately 1.3 million, 850,000 and 240,000, up 41%, 30% and 8% year over year respectively. Validating the strong brand awareness of deep localization we have created in our overseas market. As a fintech leader, technology is deeply engraved in our DNA. It remains the core of our business and our primary competitive edge. During the second quarter, we hosted an internal tech competition called Hexon. bringing together 60 R&D teams for a 36-hour session in a closed-door environment. Winning projects included Admin AI Bots, which can incorporate API function calls into large language models. Its framework can also be expanded to include multiple internal tools and support the management of different tools across platforms. Another standout, eSound. leverage AIGC to utilize fragmented time slots to increase productivity. We believe these projects demonstrate great implementation potential for enhancing our operations and overall efficiency. Next, I'd like to share some updates on our ESG progress. We recently published our 2023 ESG report, the sixth in our company's history. highlighting our dedication to transparency and sustainability. In 2023, we advanced our mission of leveraging innovative technologies to make financial service better, as well as our ESG strategy centered on technology, green principle, and kindness, in addition to giving back to society with innovative technologies. The evolution emphasizes integrity and compliance, low-carbon development, and harmonious relationships with employees, partners, and communities in its ESG management efforts. Moreover, we continue to support small business owners through the second quarter's challenges. During the second quarter of 2024, we cumulatively served around 415,000 small business owners and facilitate 14.2 billion RMB of loans to nurture their dreams. I also want to highlight our longstanding cooperation with the National Weightlifting Team and congratulate them on their recent wins at the Paris Olympics. We are proud to promote awareness of the sport alongside the team and leverage their public image to help small business owners increase their product sales. Our joint initiatives embody our shared embrace of the Olympic value of excellence, respect and friendship, helping to create a better society for all. We will continue to integrate ESG management throughout our business operations and partnerships, propelling sustainable development across the industry. Before we move on to our CFO's review of operational and financial metrics, I'd like to share that Finvolution celebrates its 17th anniversary during the second quarter, a milestone that inspires us to look towards our sustainable future. As such, we set our vision for 2030 to become an international fintech platform connecting borrowers and financial institutions across multiple global markets, and leading the industry in each of them. Vivuc remains dedicated to leveraging innovative technology to make financial services better and greener, sustainably propelling Finvolution's long-term growth. To summarize, despite China's ongoing macro challenges, we successfully deployed our leading technologies and operation capabilities to achieve solid progress in the second quarter across all the markets in which we operate. Going forward, as China's microenvironment improves, we are confident of resuming faster growth and delivering consistent returns across multiple metrics for all our stakeholders. With that, I will now turn the call over to our CFO, Jia Yuanxu, who will discuss our operational and financial results in great detail.