Lufax Reports Fourth Quarter and Full Year 2023 Financial Results
Fourth Quarter 2023 Financial Highlights
- Total income was
RMB6,857 million (US$966 million ) in the fourth quarter of 2023, compared toRMB12,318 million in the same period of 2022. - Net loss was
RMB832 million (US$117 million ) in the fourth quarter of 2023, compared toRMB806 million in the same period of 2022.
(In millions except percentages, unaudited) |
|
Three Months Ended |
|
|
|
Twelve Months Ended |
|
|
||||||
|
|
2022 |
|
2023 |
|
YoY |
|
2022 |
|
2023 |
|
YoY |
||
|
|
RMB |
|
RMB |
USD |
|
|
|
RMB |
|
RMB |
USD |
|
|
Total income |
|
12,318 |
|
6,857 |
966 |
|
(44.3 %) |
|
58,116 |
|
34,255 |
4,825 |
|
(41.1 %) |
Total expenses |
|
(12,922) |
|
(7,943) |
(1,119) |
|
(38.5 %) |
|
(45,102) |
|
(32,610) |
(4,593) |
|
(27.7 %) |
Total expenses excluding credit and asset impairment losses, finance costs and other (gains)/losses |
|
(6,574) |
|
(4,389) |
(618) |
|
(33.2 %) |
|
(26,889) |
|
(19,678) |
(2,772) |
|
(26.8 %) |
Credit and asset impairment losses,
finance costs and other (gains)/losses |
|
(6,348) |
|
(3,554) |
(501) |
|
(44.0 %) |
|
(18,213) |
|
(12,932) |
(1,821) |
|
(29.0 %) |
Net profit/(loss) |
|
(806) |
|
(832) |
(117) |
|
3.3 % |
|
8,775 |
|
1,034 |
146 |
|
(88.2 %) |
Fourth Quarter 2023 Operational Highlights
- Outstanding balance of loans enabled was
RMB315.4 billion as ofDecember 31, 2023 compared toRMB576.5 billion as ofDecember 31, 2022 , representing a decrease of 45.3%. - Cumulative number of borrowers increased by 10.0% to approximately 20.94 million as of
December 31, 2023 from approximately 19.02 million as ofDecember 31, 2022 . - New loans enabled were
RMB47.0 billion in the fourth quarter of 2023, compared toRMB77.8 billion in the same period of 2022, representing a decrease of 39.6%. - During the fourth quarter of 2023, excluding the consumer finance subsidiary, the Company bore risk on 100% of its new loans enabled, up from 22.2% in the same period of 2022.
- As of
December 31, 2023 , including the consumer finance subsidiary, the Company bore risk on 39.8% of its outstanding balance, up from 23.5% as ofDecember 31, 2022 . Credit enhancement partners bore risk on 58.2% of outstanding balance, among which Ping An P&C accounted for a majority. - As of
December 31, 2023 , excluding the consumer finance subsidiary, the Company bore risk on 33.5% of its outstanding balance, up from 19.8% as ofDecember 31, 2022 . - For the fourth quarter of 2023, the Company's retail credit enablement business take rate[1] based on loan balance was 7.9%, as compared to 7.7% for the fourth quarter of 2022.
- C-M3 flow rate[2] for the total loans the Company had enabled was 1.2% in the fourth quarter of 2023, compared to 1.1% the third quarter of 2023. Flow rates for the general unsecured loans and secured loans the Company had enabled were 1.4% and 0.8% respectively in the fourth quarter of 2023, as compared to 1.2% and 0.7% respectively in the third quarter of 2023.
- Days past due ("DPD") 30+ delinquency rate[3] for the total loans the Company had enabled was 6.9% as of
December 31, 2023 , as compared to 6.0% as ofSeptember 30, 2023 . DPD 30+ delinquency rate for general unsecured loans was 7.7% as ofDecember 31, 2023 , as compared to 6.9% as ofSeptember 30, 2023 . DPD 30+ delinquency rate for secured loans was 4.4% as ofDecember 31, 2023 , as compared to 3.4% as ofSeptember 30, 2023 . - DPD 90+ delinquency rate[4] for total loans enabled was 4.1% as of
December 31, 2023 , as compared to 3.7% as ofSeptember 30, 2023 . DPD 90+ delinquency rate for general unsecured loans was 4.6% as ofDecember 31, 2023 , as compared to 4.2% as ofSeptember 30, 2023 . DPD 90+ delinquency rate for secured loans was 2.6% as ofDecember 31, 2023 , as compared to 1.9% as ofSeptember 30, 2023 . - As of
December 31, 2023 , the non-performing loan (NPL) ratio[5] for consumer finance loans was 1.5% as compared to 1.4% as ofSeptember 30, 2023 .
Mr.
Mr.
Mr.
[1] The take rate of retail credit enablement business is calculated by dividing the aggregated amount of loan enablement service fees, post-origination service fees, net interest income, guarantee income and the penalty fees and account management fees by the average outstanding balance of loans enabled for each period. |
[2] Flow rate estimates the percentage of current loans that will become non-performing at the end of three months, and is defined as the product of (i) the loan balance that is overdue from 1 to 29 days as a percentage of the total current loan balance of the previous month, (ii) the loan balance that is overdue from 30 to 59 days as a percentage of the loan balance that was overdue from 1 to 29 days in the previous month, and (iii) the loan balance that is overdue from 60 to 89 days as a percentage of the loan balance that was overdue from 30 days to 59 days in the previous month. Loans from legacy products and consumer finance subsidiary are excluded from the flow rate calculation. |
[3] DPD 30+ delinquency rate refers to the outstanding balance of loans for which any payment is 30 to 179 calendar days past due divided by the outstanding balance of loans. Loans from legacy products and consumer finance subsidiary are excluded from the calculation. |
[4] DPD 90+ delinquency rate refers to the outstanding balance of loans for which any payment is 90 to 179 calendar days past due divided by the outstanding balance of loans. Loans from legacy products and consumer finance subsidiary are excluded from the calculation. |
[5]
We previously calculated the non-performing loan ratio for consumer finance loans by using the outstanding balance of consumer finance loans for which any payment was 61 or more calendar days past due and not written off, and certain restructured loans, divided by the outstanding balance of consumer finance loans. However, we now calculate the non-performing loan ratio for consumer finance loans by using the outstanding balance of consumer finance loans for which any payment is 91 or more calendar days past due and not written off, and certain restructured loans, divided by the outstanding balance of consumer finance loans. Under this new calculation method, the non-performing loan ratio for consumer finance loans was 1.8% as of |
Fourth Quarter 2023 Financial Results
TOTAL INCOME
Total income was
(In millions except percentages, unaudited) |
|
Three Months Ended |
|
|
||||||
|
|
2022 |
|
2023 |
|
YoY |
||||
|
|
RMB |
|
% of income |
|
RMB |
|
% of income |
|
|
Technology platform-based income |
|
5,874 |
|
47.7 % |
|
2,980 |
|
43.5 % |
|
(49.3 %) |
Net interest income |
|
4,369 |
|
35.5 % |
|
2,325 |
|
33.9 % |
|
(46.8 %) |
Guarantee income |
|
1,671 |
|
13.6 % |
|
886 |
|
12.9 % |
|
(47.0 %) |
Other income |
|
131 |
|
1.1 % |
|
315 |
|
4.6 % |
|
140.6 % |
Investment income |
|
275 |
|
2.2 % |
|
353 |
|
5.1 % |
|
28.5 % |
Share of net profits of investments accounted for |
|
(2) |
|
0.0 % |
|
(3) |
|
0.0 % |
|
73.8 % |
Total income |
|
12,318 |
|
100.0 % |
|
6,857 |
|
100.0 % |
|
(44.3 %) |
-
Technology platform-based income
was
RMB2,980 million (US$420 million ) in the fourth quarter of 2023, compared toRMB5,874 million in the same period of 2022, representing a decrease of 49.3%, due to 1) the decrease of retail credit service fees due to the decrease in new loan sales and loan balance and 2) the decrease of referral and other technology platform-based income due to the decrease in transaction volume. -
Net interest income
was
RMB2,325 million (US$328 million ) in the fourth quarter of 2023, compared toRMB4,369 million in the same period of 2022, representing a decrease of 46.8%, mainly due to the decrease in loan balance, partially offset by the increase of net interest income from the Company's consumer finance business. -
Guarantee income
was
RMB886 million (US$125 million ) in the fourth quarter of 2023, compared toRMB1,671 million in the same period of 2022, representing a decrease of 47.0%, primarily due to the decrease in loan balance and a lower average fee rate. -
Other income
was
RMB315 million (US$44 million ) in the fourth quarter of 2023, compared to other income ofRMB131 million in the same period of 2022. The increase was mainly due to the change of fee structure that the Company charged to its primary credit enhancement partner. -
Investment income
was
RMB353 million (US$50 million ) in the fourth quarter of 2023, compared to RMB275 million in the same period of 2022, mainly due to the increase of return rate.
TOTAL EXPENSES
Total expenses decreased by 38.5% to
|
|
Three Months Ended |
|
|
||||||
(In millions except percentages, unaudited) |
|
2022 |
|
2023 |
|
YoY |
||||
|
|
RMB |
|
% of income |
|
RMB |
|
% of income |
|
|
Sales and marketing expenses |
|
3,706 |
|
30.1 % |
|
2,007 |
|
29.3 % |
|
(45.9 %) |
General and administrative expenses |
|
750 |
|
6.1 % |
|
556 |
|
8.1 % |
|
(26.0 %) |
Operation and servicing expenses |
|
1,659 |
|
13.5 % |
|
1,507 |
|
22.0 % |
|
(9.2 %) |
Technology and analytics expenses |
|
458 |
|
3.7 % |
|
319 |
|
4.7 % |
|
(30.2 %) |
Credit impairment losses |
|
6,259 |
|
50.8 % |
|
3,567 |
|
52.0 % |
|
(43.0 %) |
Asset impairment losses |
|
7 |
|
0.1 % |
|
31 |
|
0.5 % |
|
340.0 % |
Finance costs |
|
501 |
|
4.1 % |
|
50 |
|
0.7 % |
|
(90.1 %) |
Other (gains)/losses - net |
|
(419) |
|
(3.4 %) |
|
(93) |
|
(1.4 %) |
|
(77.7 %) |
Total expenses |
|
12,922 |
|
105.0 % |
|
7,943 |
|
115.8 % |
|
(38.5 %) |
-
Sales and marketing expenses
decreased by 45.9% to
RMB2,007 million (US$283 million ) in the fourth quarter of 2023 fromRMB3,706 million in the same period of 2022. The decrease was mainly due to 1) the decreased loan-related expenses as a result of the decrease in new loan sales and 2) decreased retention expenses and referral expenses from platform service attributable to the decreased transaction volume. -
General and administrative expenses
decreased by 26.0% to
RMB556 million (US$78 million ) in the fourth quarter of 2023 from RMB750 million in the same period of 2022, mainly due to the Company's expense control measures and the decrease of tax and surcharge. -
Operation and servicing expenses
decreased by 9.2% to
RMB1,507 million (US$212 million ) in the fourth quarter of 2023 fromRMB1,659 million in the same period of 2022, due to the Company's expense control measures and decrease of loan balance, partially offset by increased resources invested in collection services. -
Technology and analytics expenses
decreased by 30.2% to
RMB319 million (US$45 million ) in the fourth quarter of 2023 fromRMB458 million in the same period of 2022, due to the Company's improved efficiency and expense control measures. -
Credit impairment losses
decreased by 43.0% to
RMB3,567 million (US$502 million ) in the fourth quarter of 2023 fromRMB6,259 million in the same period of 2022, mainly due to the decrease in provision of loans and receivables as a result of the decreased loan balance. -
Finance costs
decreased by 90.1% to
RMB50 million (US$7 million ) in the fourth quarter of 2023 fromRMB501 million in the same period of 2022, mainly due to the decrease of interest expenses as a result of repayment of Ping An and C-Round Convertible Promissory Notes. -
Other gains
decreased by 77.7% to
RMB93 million (US$13 million ) in the fourth quarter of 2023 fromRMB419 million in the same period of 2022, mainly due to the increase of losses associated with certain risk assets and the high base of the same period last year due to one-time recovery of losses associated with legacy business via law suit.
NET LOSS
Net loss was
LOSS PER ADS
Basic and diluted loss per American Depositary Share ("ADS") were both
BALANCE SHEET
The Company had
Special Dividend
On
Annual General Meeting
It is proposed that the forthcoming annual general meeting of the Company (the "AGM") will be held on
Business Outlook
For the full year of 2024, the Company expects the new loan sales to be in the range of
Conference Call Information
The Company's management will hold an earnings conference call at
Registration Link: https://dpregister.com/sreg/10187050/fbc35f8894
A live and archived webcast of the conference call will also be available at the Company's investor relations website at https://ir.lufaxholding.com.
The replay will be accessible through
United States: 1-877-344-7529
International: 1-412-317-0088
Conference ID: 2835954
About
Exchange Rate Information
This announcement contains translations of certain RMB amounts into
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Statements that are not historical facts, including statements about
Investor Relations Contact
Email: Investor_Relations@lu.com
Tel: +1 (646) 308-0546
Email: lufax.ir@icrinc.com
|
||||||||||||
UNAUDITED INTERIM CONDENSED CONSOLIDATED INCOME STATEMENTS |
||||||||||||
(All amounts in thousands, except share data, or otherwise noted) |
||||||||||||
|
||||||||||||
|
|
Three Months Ended |
|
Twelve Months Ended |
||||||||
|
|
2022 |
|
2023 |
|
2022 |
|
2023 |
||||
|
|
RMB |
|
RMB |
|
USD |
|
RMB |
|
RMB |
|
USD |
Technology platform-based income |
|
5,874,337 |
|
2,980,386 |
|
419,779 |
|
29,218,432 |
|
15,325,826 |
|
2,158,597 |
Net interest income |
|
4,369,470 |
|
2,325,425 |
|
327,529 |
|
18,981,376 |
|
12,348,357 |
|
1,739,230 |
Guarantee income |
|
1,670,743 |
|
886,168 |
|
124,814 |
|
7,372,509 |
|
4,392,376 |
|
618,653 |
Other income |
|
130,927 |
|
315,006 |
|
44,368 |
|
1,238,004 |
|
1,143,770 |
|
161,097 |
Investment income |
|
274,594 |
|
352,847 |
|
49,697 |
|
1,305,625 |
|
1,050,453 |
|
147,953 |
Share of net profits of investments accounted for |
|
(1,733) |
|
(3,012) |
|
(424) |
|
(218) |
|
(5,416) |
|
(763) |
Total income |
|
12,318,338 |
|
6,856,820 |
|
965,763 |
|
58,115,728 |
|
34,255,366 |
|
4,824,767 |
Sales and marketing expenses |
|
(3,706,378) |
|
(2,006,965) |
|
(282,675) |
|
(15,756,916) |
|
(9,867,488) |
|
(1,389,807) |
General and administrative expenses |
|
(750,422) |
|
(555,520) |
|
(78,243) |
|
(2,830,119) |
|
(2,304,835) |
|
(324,629) |
Operation and servicing expenses |
|
(1,659,300) |
|
(1,506,757) |
|
(212,222) |
|
(6,429,862) |
|
(6,118,635) |
|
(861,792) |
Technology and analytics expenses |
|
(457,569) |
|
(319,278) |
|
(44,969) |
|
(1,872,454) |
|
(1,387,055) |
|
(195,363) |
Credit impairment losses |
|
(6,258,530) |
|
(3,566,694) |
|
(502,358) |
|
(16,550,465) |
|
(12,697,308) |
|
(1,788,378) |
Asset impairment losses |
|
(7,101) |
|
(31,246) |
|
(4,401) |
|
(427,108) |
|
(31,246) |
|
(4,401) |
Finance costs |
|
(501,042) |
|
(49,775) |
|
(7,011) |
|
(1,238,992) |
|
(414,023) |
|
(58,314) |
Other gains/(losses) - net |
|
418,781 |
|
93,274 |
|
13,137 |
|
3,459 |
|
210,336 |
|
29,625 |
Total expenses |
|
(12,921,561) |
|
(7,942,961) |
|
(1,118,743) |
|
(45,102,457) |
|
(32,610,254) |
|
(4,593,058) |
Profit/(loss) before income tax expenses |
|
(603,223) |
|
(1,086,141) |
|
(152,980) |
|
13,013,271 |
|
1,645,112 |
|
231,709 |
Income tax expenses |
|
(202,712) |
|
253,666 |
|
35,728 |
|
(4,238,232) |
|
(610,626) |
|
(86,005) |
Net profit/(loss) for the period |
|
(805,935) |
|
(832,475) |
|
(117,252) |
|
8,775,039 |
|
1,034,486 |
|
145,704 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net profit/(loss) attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Group |
|
(815,292) |
|
(844,238) |
|
(118,908) |
|
8,699,369 |
|
886,865 |
|
124,912 |
Non-controlling interests |
|
9,357 |
|
11,763 |
|
1,657 |
|
75,670 |
|
147,621 |
|
20,792 |
Net profit/(loss) for the period |
|
(805,935) |
|
(832,475) |
|
(117,252) |
|
8,775,039 |
|
1,034,486 |
|
145,704 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings/(loss) per share |
|
|
|
|
|
|
|
|
|
|
|
|
-Basic earnings/(loss) per share |
|
(0.71) |
|
(0.74) |
|
(0.10) |
|
7.6 |
|
0.77 |
|
0.11 |
-Diluted earnings/(loss) per share |
|
(0.71) |
|
(0.74) |
|
(0.10) |
|
7.58 |
|
0.77 |
|
0.11 |
-Basic earnings/(loss) per ADS |
|
(1.42) |
|
(1.48) |
|
(0.21) |
|
15.2 |
|
1.54 |
|
0.22 |
-Diluted earnings/(loss) per ADS |
|
(1.42) |
|
(1.48) |
|
(0.21) |
|
15.16 |
|
1.54 |
|
0.22 |
|
||||||
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION |
||||||
(All amounts in thousands, except share data, or otherwise noted) |
||||||
|
||||||
|
|
As of |
|
As of |
||
|
|
2022 |
|
2023 |
||
|
|
RMB |
|
RMB |
|
USD |
Assets |
|
|
|
|
|
|
Cash at bank |
|
43,882,127 |
|
39,598,785 |
|
5,577,372 |
Restricted cash |
|
26,508,631 |
|
11,145,838 |
|
1,569,858 |
Financial assets at fair value through profit or loss |
|
29,089,447 |
|
28,892,604 |
|
4,069,438 |
Financial assets at amortized cost |
|
4,716,448 |
|
3,011,570 |
|
424,171 |
Accounts and other receivables and contract assets |
|
15,758,135 |
|
7,293,671 |
|
1,027,292 |
Loans to customers |
|
211,446,645 |
|
129,693,954 |
|
18,267,011 |
Deferred tax assets |
|
4,990,352 |
|
5,572,042 |
|
784,806 |
Property and equipment |
|
322,499 |
|
180,310 |
|
25,396 |
Investments accounted for using the equity method |
|
39,271 |
|
2,609 |
|
367 |
Intangible assets |
|
885,056 |
|
874,919 |
|
123,230 |
Right-of-use assets |
|
754,010 |
|
400,900 |
|
56,466 |
|
|
8,911,445 |
|
8,911,445 |
|
1,255,151 |
Other assets |
|
1,958,741 |
|
1,444,362 |
|
203,434 |
Total assets |
|
349,262,807 |
|
237,023,009 |
|
33,383,993 |
Liabilities |
|
|
|
|
|
|
Payable to platform users |
|
1,569,367 |
|
985,761 |
|
138,842 |
Borrowings |
|
36,915,513 |
|
38,823,284 |
|
5,468,145 |
Bond payable |
|
2,143,348 |
|
- |
|
- |
Current income tax liabilities |
|
1,987,443 |
|
782,096 |
|
110,156 |
Accounts and other payables and contract liabilities |
|
12,198,654 |
|
6,977,118 |
|
982,707 |
Payable to investors of consolidated structured entities |
|
177,147,726 |
|
83,264,738 |
|
11,727,593 |
Financing guarantee liabilities |
|
5,763,369 |
|
4,185,532 |
|
589,520 |
Deferred tax liabilities |
|
694,090 |
|
524,064 |
|
73,813 |
Lease liabilities |
|
748,807 |
|
386,694 |
|
54,465 |
Convertible promissory note payable |
|
5,164,139 |
|
5,650,268 |
|
795,824 |
Optionally convertible promissory notes |
|
8,142,908 |
|
- |
|
- |
Other liabilities |
|
2,000,768 |
|
1,759,672 |
|
247,845 |
Total liabilities |
|
254,476,132 |
|
143,339,227 |
|
20,188,908 |
Equity |
|
|
|
|
|
|
Share capital |
|
75 |
|
75 |
|
11 |
Share premium |
|
32,073,874 |
|
32,142,233 |
|
4,527,139 |
|
|
(5,642,769) |
|
(5,642,768) |
|
(794,767) |
Other reserves |
|
2,158,432 |
|
155,849 |
|
21,951 |
Retained earnings |
|
64,600,234 |
|
65,487,099 |
|
9,223,665 |
Total equity attributable to owners of the Company |
|
93,189,846 |
|
92,142,488 |
|
12,977,998 |
Non-controlling interests |
|
1,596,829 |
|
1,541,294 |
|
217,087 |
Total equity |
|
94,786,675 |
|
93,683,782 |
|
13,195,085 |
Total liabilities and equity |
|
349,262,807 |
|
237,023,009 |
|
33,383,993 |
|
||||||||||||
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||||||
(All amounts in thousands, except share data, or otherwise noted) |
||||||||||||
|
||||||||||||
|
|
Three Months Ended |
|
Twelve Months Ended |
||||||||
|
|
2022 |
|
2023 |
|
2022 |
|
2023 |
||||
|
|
RMB |
|
RMB |
|
USD |
|
RMB |
|
RMB |
|
USD |
Net cash generated from/(used in) operating activities |
|
4,823,634 |
|
4,692,133 |
|
660,873 |
|
4,455,301 |
|
15,030,286 |
|
2,116,972 |
Net cas h generated from/(used in) investing activities |
|
1,063,535 |
|
(4,060,705) |
|
(571,938) |
|
8,447,678 |
|
(5,937,432) |
|
(836,270) |
Net cash generated from/(used in) financing activities |
|
(7,075,240) |
|
(879,889) |
|
(123,930) |
|
(9,918,803) |
|
(20,554,946) |
|
(2,895,104) |
Effects of exchange rate
changes on cash and cash |
|
(148,951) |
|
(100,172) |
|
(14,109) |
|
57,025 |
|
404,677 |
|
56,998 |
Net increase/(decrease) in cash and cash equivalents |
|
(1,337,022) |
|
(348,633) |
|
(49,104) |
|
3,041,201 |
|
(11,057,415) |
|
(1,557,404) |
Cash and cash equivalents at
the beginning of the |
|
30,874,533 |
|
18,828,729 |
|
2,651,971 |
|
26,496,310 |
|
29,537,511 |
|
4,160,271 |
Cash and cash equivalents at the end of the period |
|
29,537,511 |
|
18,480,096 |
|
2,602,867 |
|
29,537,511 |
|
18,480,096 |
|
2,602,867 |
View original content:https://www.prnewswire.com/news-releases/lufax-reports-fourth-quarter-and-full-year-2023-financial-results-302095602.html
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