Q3 2020 CNFinance Holdings Ltd Earnings Call
Good day and welcome to the C and finance third quarter 2020 earnings Conference call. All participants will be in a listen only mode should you need assistance. Please signal a conference specialist by pressing the star key followed by zero. After todays presentation, there will be an opportunity to ask questions. Please note that this debt. This event is being recorded.
I would now like to turn the conference over to Matthew. Please go ahead, Sir your line.
Yes. Thank you. Thank you good morning on even even the EPS juggle Hello.
From.
[music].
Good morning, and evening and they'll come true this year by that circle other sunny uplands or how do you find that the results conference call today's.
Today's call artsy on Mr. Guy they'll walk us all the operating results followed by the financial results from our CFO Mr. Andy.
Her that they'll have a true this action.
Before we start I would like to remind you that this conference call contains forward looking statements made on the meaning of section 21 E off that's a tricky Exchange Act on 90 34 as amended and as defined in the U.S. Private Securities Litigation Reform Act on 90 95 as.
These forward looking statements can be identified by Terminologies, such as Mayo expects anticipates future intends plans believes estimates targets going forward I look at similar statements.
They must start based up on managements current expectations on current market operating conditions.
And relate to events that involve known or unknown risks uncertainties and other factors, although they truck difficult to predict and many of which are beyond the company's control, which may cause the company's actual results performance or achievements to differ materially from both on the forward looking statements on.
Information regarding these and other risks uncertainties on factor. It's included in the company's value with the U.S., a tricky said Exchange Commission.
The company does not undertake any obligation to update any forward looking statements as a result from the only information you'll true but otherwise.
As required under law no he's they'll come RTL, Mr. Guy, that's only pay cash flow [noise].
She has held true [laughter].
Yes, okay.
Paul So you're talking about GAAP total ball, we don't forget nice, hoping so feel free.
Actually going on to your hobbies on what's your hands on next years all on.
Like you know already Arnie and your friends, you, but you know G.E. cheese.
Well my wish on I got she has helped you strength you don't get line <unk>. So from yen Ching that child line cheap.
Phil well on a woman the simple you she played I back out the balance sheet.
Thank you operator, and thank you or flow joined this conference call to date on the day core I mean to do is to operation. If I answer were south of the on site now doing that from quarter.
We also introduced the new challenges and opportunities for San strength this quarter.
Last I would take your questions we out on the Oh.
Already hurting you end up these from people on social channel.
Yeah.
Oh, the parcels and GAAP, how what's the deal yet she shows will that be questioned GAAP.
And you know she's always shooting from quite you teaching started C and b.
Even though buttons on it wasn't so.
Gross to balance you will see chance you need that you want your line and be armed intend on buttons that you would you.
During the third quarter I'll try and be 20 income from me Whitney we tolerate in major operating and financial indicators.
Collaborating with multiple shots on me we facility allows <unk> RMBS the Gaussian enlighten three me around where the sampling price of 64% from the lot fortune.
<unk> net income of approximately you I'd be thinking meal or the selling price Nike my per south front, the low <unk>.
Also then price from diesel she does the jobless claims and so.
We also believe me shockey comedy.
No recovery in operating a financing where jobs are mainly attributable to the falling recently.
Oh, Yeah on one thing she ones from the phone.
Jeez [laughter] <unk>.
Hi, I'm wondering I mean from Canada, and Oh look on all fronts.
Well I don't know.
From both of you to sell which you see on that.
Oh, okay.
If you find people from all the GBP 'cause, it's how much money on the single.
So the woman share now given what you know what.
Ladies and balance upon book.
Each in cool shall we she has so many holes from whoops junk with him so Jean you'll cheese or quote you that she channel.
It sounds like on time, <unk>, Jude Dinges goes on Axogen.
So you sort of I'm sure.
Decided you know the Pep on on that you had some you know why do you from [laughter].
[noise] personally China has a fast for me from teamed with Nike than I thought.
He's out national consumption and from the actions have liked coverage.
Michael asked more and the price they set forth on T. have stopped to operate in school capacity.
GDP in this quarter. It was also the highlights of the year.
I haven't introducing the price to Cortez.
Based on the management, that's day, making and ft. On that you would have ever said you have the mall for capital went every store operations.
And our south.
Portable and efficient low per debt, we are well Serbia line, so say financing needs.
[laughter] judgment, what's great is that true by the high low origination want it in the third quarter.
Good day.
She is so low.
Well the no Oregon Gene I'm also yes, yes.
Yeah, the only issue.
Secondly, the collaboration model has on its looks like its compatibility otherwise.
Keep on most of the easily use from Craig.
Hopefully.
Oh, so don't like Jim one more pardon me.
Easy line almost little Jin from you.
Touching on people younger on Gen $1 for the from her <unk>.
Hi, Neil.
Thank you Keith on the gym lunch all debt Jos a bizarre policy by me volume from put up the home or me against your debt. So called people. It doesn't you phones, yet shots on the Arabs yachts to be well nice you know he geophones on flow to the simple leasable well that's true for the troubling already.
Hi, I'm from me coupled with someone on the Shengli genes she's on that yet.
Sure you.
You on Monday.
Did you should focus on the pullback Gigi called won't go on quite often going on from home on shelf lobby, establishing don't book, sometimes the clean jumping shall ricci.
On the JV trends on assumed with accounts it well on the bio hurdle.
She takes a little more contribution from the change in debt.
[noise] debt. So that's why did you called it correctly on Mako is now Im sure Ash from my two reclamation.
We have always been collaboration with well established a license true normally.
Leverage ratio of our joint.
Ladies Chuck's plan, it's widely comply with the regulation.
Oh August trends.
On the Supreme people on court issue on meal or debt.
[laughter] cap on fiber line the interest rate swaps on LP are.
We collaborate we license Trust company, we are not get to get new regulation.
However on the.
The dedicated a team took a one more detailed read on the new regulation, we have actually come into like Medicaid, we our Chuck sometimes income part not as though not not.
Family designed to support for order that balance with an illness by wanting to hurry, reducing the interest rate on our loans or.
And then Oh this party weakness.
On the South where do you go out our low for debt that is leading the interest rate cap on this new regulation.
Yeah.
Jim I'm also book Yup Yup.
He also called Shelbyville woman that she Paymode X gene Yankees mobile phone from called yet.
Taking on somebody and from June.
On coal units will hold on impulse repeat something how are you on self and kind of loans.
Turning from people. It seems your price works you can Oh jeez on federal order and that's really what my simple search opportunity that's true combinations will bottom line with the topic on Sealy.
And you know who she hasn't seen woke up on that financing huntingtons on minimal so.
On kind of shoot Hamilton moving in that people from on lets see called U.
[noise] another advantage on the collaboration model is its efficiency and stuff, let Pete you talked you 20, the collaboration model has overcome two major challenges.
When the industry was facing that deterioration course by the COVID-19 in the first half the year.
We are able to keep the operating cost at record low [noise].
When the market start to recover revenue late in the first quarter.
No not on the collaboration more don't respond quickly to the market the mall.
And captured the opportunity to land market and they penetration and Corp.
During the quarter we.
We have how old truck from when we partner opposite it 10 loans on logging RMB 3.1 really on where.
With the spending on imports of 64% loans a lot fortune.
This quarter has been highways in low origination weren't answering their launch on the collaboration market.
[laughter], who do you find people you go from NV, Yeah, I came on on me on that.
Yeah, Jim One day, she will walk through the female condom room on the one that's yet.
Yeah sure I mean, you can't you're not seeing Bobby Burleson.
I also want to point now think there's third quarter, we have been facing two major regulatory challenges.
One is the recommendation to limit the scale non standup her debt issued by the chest from Philly.
And the other one is the new cap on interest rate on pilot line thing.
Oh, Yeah simple war room on price on a sudden was.
Hold on one.
Hi them financing that's when he comes on.
So you will have on quite small shop, yeah, well gee tons on clean channel Levy.
High School food, you're just touching on pinball machine a wonderful also nice growth people from <unk>.
Firstly, we are seeing regulated suppressing the toll toll on sides on trust company.
Make corp, the highest wanting core to our business.
What you might actually affect our gross and rate difficulty on for Doug reducing debt funding course.
However, see on after we've tried to stock or less range, we more Chuck on me to avoid such possibilities.
She's no.
Oh, you called food food on chunky, having fallen from done do you have on a full moon shots on goal you know on on Jan the actual growth is your pencil couldn't book jump on income, but she calls me shopping they'll fall.
Secondly on profit margin is lower opto, we wanted to reduce the interest rate loans something like eight.
In response to that we will 'cause they suddenly be working on reducing financing of course, while optimizing the efficiency of our operations.
These yes, its seasonally low.
No again, though from Jeff on.
On the shelf so even cheaper.
On the Tee up all CDW on who you're going on where you hope on the TV. She she also hope on the new simple gem tone, She Bible job she income.
Surely and most importantly thinks they on ASP is sharing true freight and Barry which together with the best partner.
Leverage from one though we have also adjusted profit sleep without a partner on the Chuck how many part not true as Jones day a possibility.
[noise], neither she made us on GM.
That's true Darla.
I see the digital channel wasn't working on what kinda talk though.
Well no I cannot go into the more sometimes you go from a from how low two things on.
Thank you and hang it on openness Philadelphia, So some people that channel by job then got on channel that shift.
The only show on on a whole eventful on people the father zone.
Something like 20 hours a day.
Well I mean from the Kindle nickel or.
Fortunately did change also per se on a law we opportunities.
I've been fortunate in wage Neil on regulation, where proper shoes. We kindly we were pleased to flight hour more do import debt being well received by the market doing.
During the quarter number of cycles partner has reached 1617 come.
We see hundreds of last quarter.
Why the number on sales partner, who has to silica loans have rich 1020 somehow weve 814 of low fortune.
On the increased 11% and 21% respectively.
Mean from Yeah, Hi, Charles on these you will see them from harvest that will go on and she's on some found on <unk>. So there.
On the apartment doesn't even from you do you get a cold from home. She told you by phone on did you much from some people that volume shoes will come.
Dozens on <unk>, although sarkozy once yeah.
From the Jinjin Qian, where I'm from Matt Hello, So far the.
Deviation from the target you spoke on the U.S simple called on the panel Oh, what it should be shot sounds intelligent woman debt, how do you mean.
Yes.
On the other has he went the profit margin after interest rate adjusted its low works, where fan out yes partner and Chuck So really a huge the miles per hour Neil <unk> per day, how good the loan origination warranty on doing four to 540, 64%.
To eye and be 3.1 billion from RMB 1.8 deals on in Q2.
We have to Ping Martin Currie implementation at the Wisdom. He went live on the L. its high Court order went.
When opportunity shows we might talk to our sales partner interest on that so we adjusted interest rate of our Florida on the price.
Moving slowly compliant.
These on people that can count on he's yeah.
On the machine, we put on that.
Hmm share cells without even jamar either.
From teaching upon me on car loans.
And for the shelves it sounds easy so depending on how many of them from from cool well complete something on the kind of Tony jumping on <unk>.
Well that's on your jump we couldn't leave.
Leave her she thing.
Thank you from prior year, the jump from what I'm hopeful that the on <unk>.
The resale of third quarter his show in hours fostered in new regulation over interest rate on timely and effective.
We believe that this new regulation, we bring another consolidation to the industry.
Unqualified potato chip as we true cost control will be glad to leave out however to see on finance, we believe it would be our 40 channel to English market share.
Yeah, they are well known fees on <unk>.
Oh, hi, coupons and on the southern teachers, who [noise].
Oh, no I'm I'm excited about the on doesn't on drugs.
[laughter] tissue quota anymore. So it's usually hard he hung in quality.
They think that future we observed that the era of extensive grps for low industry is over.
At this time for index, probably leave it to a 30 day the markets to maintain our lending growth in the next decade, we've been focused on scaling and day, how Orient practice.
Hi, Phil adopt him off on that.
Well have a pet hospital or going to the June quarter from Holland.
Ah the at home.
Well, Yeah gene are you doing on that Joe leave on fund hopefully on food she she yep.
Well nice to talk to you Couldnt g. the surgeon on the whole book.
Well nothing well then you know on a more short line.
So we use something she.
She had hopkins on the you'll know from job and the team.
Margin Gunbattle from an awful.
Intense on operating with the biggest gap.
Our advantage is that the collaborations more Doe has already been where we see that.
It's always say task force, so not a well established at the moment.
Yeah, we have been consistently looking for more economical fondly socket.
Our food your focus is to continue upgrading this ever since then and fortune our profit slate, we best partner.
In order to in watch more holidays like low facilitate such a joined our platform and catch a lot your market share with our partner.
Oh sure didn't Josh on funding.
Quite on what would change.
Yes on what's in that book in the shop tenants for sure.
Well move on from what the shale cohort G and things and I'm fine.
Finally on couldn't velocity on she will be essentially what's on trends either gene on single cuisines from sheet right.
Well its football supplemental you found you back from from 18 cents, you know, whom she wants on the leap.
At the same time another stretched your focus is to.
To push out diversified, Florida, just served a neat self customers our.
Our plan is to discover more specific in more of our per sassy septimus by analyzing the if they've been touched on but.
To better match the needs of new customers, we get from time sell financial institution.
On enhanced our ROE all the leading service for why the into home equity loans industry.
Jeanne Shaheen, sometimes you'll see on she's on Shelby my job number.
Well, let's see how they're on Java Cookie, that's who.
I was wondering what she's only one you sold your face you choose.
She isn't so much she had on Dawson chief home phone from multiple incidents and each on.
Yes, it's also the low pool constitutional thinking sometimes even talk on the phone junkie surgeons from that.
The detail oriented Pratchett, Maine.
Choosing higher efficiency with lower course.
Adjusted that we plan to in watch in western more on technology to enhance our carpet sales capacity I'll see to management and data on that at that.
<unk> out to make though is to improve the efficiency of the whole business was either.
So far were seeing the low application rebuilding.
Moving material, just facilitating and disposing of low.
At the same time, we will also work on board any our flow resources, such as launching our own idea for debt to reduce funding cars.
Already aren't anywhere so closely tied closely but you'll see again grew from horseshoe Virgin loans.
She even from the yen goes from.
And I assume her wu the soldier gene in a single piece on when you can give us from probably to the share.
You know Oh approval from from all the things that I think on so little margin window true.
Moving on cool HM.
Again on legal on that.
[laughter] vocal on Chaldean <unk>.
Well I mean.
In their <unk> [laughter] on from <unk> to <unk>.
General from local governments <unk> <unk> will hinge on.
Hi, we keep on <unk>, hey, good people on her she.
Harping on day, one shooting that Formula one simple once you from fossil fuel.
And yet you from people real simple <unk> she doesn't go up we.
We will go on humble and called her job.
John you try and he is a special year line. Many AGA financing income enterprise see on finance has experienced significant disruption to its operations.
You true the COVID-19 pandemic, China, new regulation on share how many non standard, Florida, Ampyra Len quite loudly.
GAAP ortho adversely affect our business.
Fortunately I were really on and dedicated team have worked closely together to overcome those challenges.
We were able to income I look I wouldn't answer why Oh operating we track how many partners to make snafus or we adjustments.
We were also able to make timely response to the new regulation on private lending interest rates.
Just as our President XI jinping ones that.
How to new opportunities in price it's sitting.
<unk> newest jockey yeah.
See on App is confident and capable as always.
To keep refining its now and sees every opportunity.
We will carry forward the momentum from a true courtship.
Continuously achieved new growth and ultimately inputs our share hold its written.
[noise] cheniere well jump on us again jobs Illumina, Seattle, the new changes being.
And you would have even just hold true, earning on hernia and few strategy. Those are kind of went on.
She is yet [noise].
Now I would like to hand, the call over to John to see Oh missed some deeming who will walk you through the financial were south to our third quarter 2020. Thank you.
[noise] [laughter] stable and thanks again for arrow on for going off the day.
I'll walk you through our sort of caught out on its on the financials.
Basically year on year comparison is the best way to really be all for from us.
Unless otherwise stated Oh percentage and if I'm going to give will be on that basis, Oh, Oh number if I'm going to get what we need and maybe.
That's all September book is plenty plenty on.
Oh go on Sunday low free people seek was true from corn for from the compared to 11.3 billion I'd be as all these numbers wasn't from.
The Nike.
Oh loan origination volume was sweet.
Resolved and on the Nike free maybe.
Compared to 1700 on buying Neely, you know things here, we'd all like Nike.
Interest on the financing supposed to be on loans was 400 funds you free Neely a day.
Degrees out looking for from.
Finally deals with a combined effect, though for the degree you up on US all the average daily outstanding loans Principal last decrease was a result, El Morro law origination volume as compared to the amount on longer pay all collectively these so called her else when he Nike.
On the second the lowered on interest rate on loans.
He paid it off to the hobbies off from the old regulation on private loans the interest rate on August one we went from Quentin.
Interest expense this was 184 moving on.
I'm here to 200 barsky by moving.
Formulate due to the decrease in the principles of the boring on.
Agreement so they portrayed on other borrowings.
Collaboration costs force wheels partner include school well hundreds. So if you really are for the full quarter outside the function compared to 50 from a moving formulate yields will increase I'll walk on the loan principal under the new collaboration model as compared to the from here.
Read outs on T. Nike.
For a leader on for credit losses was.
So if you want moving a decrease of about 43% from 55, mainly on Andy you know some pureed on Sunday night. The decrease was mainly attributable to the combined effect, though.
Before that.
The decrease the outstanding principal balance delinquent loans on the loans delinquent between 90 day, which resulted in a decrease you collect really affects alarming.
On the second are you on quick incredibly great litigation position well helped by the steel partner Pixelworks Lager, among I'll guarantee us a recognized compared to the frontier read all comes from Nike.
Total operating expense is war Wow.
118, maybe.
The increase on fire for fun.
Compared with 113 million units than purely Dolphins Nike.
It's primarily due to the combined but I'll refer to the increase in share based compensation expenses related to that Youre all option with Brian on December looking for free.
On T. Nike.
Second degree on employee expense and operating lease costs.
Income tax expense. This was funky 5 million a decrease of 60% from the school media you nothing fuel doubts on he like team, partly due to a decrease the amount of taxable income.
Net income was about 50 million degrees, though.
72% from 100, and something from a minute than purely the on frenzy vaccine.
That's all from birth Lucky countries on a comprehensive cash and the cash equivalents all one point so in theory.
Actually buying a thing I felt from somebody from something Nike.
I agree I.
The aggregate delinquency rate for loans originated by the company.
Richard revenue than total ban is I'll walk from the loan principal Openreach on that you film on payment <unk> steel.
So per bumpy. It's also aggregate total amount of loans, we are reserving it seems funky 14.
Slightly increased from 5.4 per fun I thought would be from Brooklyn Force funds Nike swap out.
3.6% that's on the September Clinton Clinton plant.
We bought we'd now like to open up the call for you on a.
Okay. Thank you.
We will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone. If you are using a speakerphone. Please pick up your handset before pressing the keys. If anytime. Your question has been addressed you will like to withdraw. Your question. Please press Star then two at this time, we'll pause momentarily to assemble our roster.
[music].
And our first question will come from William Gregos Zaremski with Greenridge Global. Please go ahead.
Oh, Hi, we're all the loans.
Range after the regulation or just the new issuances.
On.
Well just your thoughts on the other.
Definitely interesting way I mean, they're not really distinguish what I Oh sure new soiled Ah Ah you should they.
I think on one that line, but at least go get Hologic event on hold off on that she'd like 1 million just talking about on.
Oh, well that the guys that we go into <unk>.
That's true.
And that's going on just a BBB singly or well me channel actually making children you just thought I'd say I think the volume.
Outreach share on the do you guys see that keep on D.V., how should I say on does Jennifer on meeting.
We haven't bid on your judgment, it's true loans facilitates it clearly is to be published on the new older rig share is on August 20th.
Let's see which will gradual woman Hershey low you got donkey, but Fortunately book, if I want Matt from bunch like Algeria woman side, you got some great to price hope almost all major well finish on gauzy, but she would the auto policy going on we've equal best true then the net.
As for the loans that facilitates it stopped or did you. All day came out we have been strictly controlled interest rate under its order, which is a wrong 50 of 15.4% annually that you wanted to your question on the G. G. D doesn't go from with whom we didn't make sense just on that.
Uh huh.
And we have seen communicating and monitoring the reaction as shown on the implementation itself, the new rules and are monitoring deeper and regulators and the markets.
Well my home solution that he doesn't want from whatever T C.
Yeah, just as well.
Why did the book.
I really think that she would have to price we oxygen free.
On a little bump due from speaking to go either from meal from ones, which is a good example doesn't keep hold true agenda. He got back on.
Based on the information on the gas from the regulators and a related authorities on our or we have came into on there.
Their opinion is that there's that neutral on the applied to private builders and I lessons.
Enders smell for institutional lenders the children's book wage pilots, you'll do go you know how simple or did you go on which I've done you know who the producers on should let me go on.
Books Young book is the national debt. So the some good listeners that the lessons to learn lessons is the children on under such as banks Trust are not subject to this new order.
And what can you do it sounds from quasi go to your warm and the oil does pick up on parcels at home gross in quoting bump on the wireless you need a geological.
So as I have introduced.
All the loans they facilitate our collaborated with lots of companies that we consider all Delta has oh lessons that is different institutional lenders to show a little bit they sub debt that is on the order.
They'll be livelihoods you can get from no. Let's look on normally should bounce back and good luck chunky chunky BB should on the Tivo so for in the coming in the coming on late in my real adjusted our interest rate to caught up with a longer tenure.
That's true take the book, which you don't go through your book.
Book The book, we're told woman she bought but not by too much we wont exceed 18% annually before any products or something that is.
Ah Lisanti wheel on roughly 20 times he or she does either to go does it go who don't come up with I think that I went on your flow teacher or whether they'll take actions gradually in the coming on line and I think they will appear on our on our off on every dollar as well.
Okay.
Okay, Great and then what was the average loan size and long duration in the quarter.
Say near late stage jobs, I shall budget or what are your whole on the dungeons on Codell hail dungeon to back once you're done with your Doctor Phil.
Oh, no low me telling me.
Thank you do you need on Lucky than you thought you would go to seek she EBIT got you.
And there are a couple sectors.
In the in the company I mean in the fourth quarter. The first thing is the on National holiday.
Of Oh, China.
You're gonna stay cool it. They think are you solely on India the zone.
This may have an adverse effect on the low RVP nation and our business.
So you have on the GE on Digoxin equal you bundle should they got from GE isn't I'd on definitely will yield on Sunday probably.
But based on our experience in the past fourth quarter tends to be one of the Basque orders in the year.
We will immediately from a difference equaled 30 day, you'll know from your philosophical Johnson <unk> Johnson <unk>. Johnson's you are you've got I got you Gotta go on you got actually so lift there's two factors offsetting each other we still have I think the on every dollar felt the fourth quarter will be positive.
Total debt.
Oh, no I don't dungeon on one of your horse against it.
That's true, but sometimes in the simple about them on intermodal or average ticket size, we don't expect it shouldn't be too much different than as usual.
Or sometimes even on question I don't Miss your machine Cool Yeah. We also see book on border Pine Galdikas either figure.
Bump on book wouldn't bundle I know.
No two how would you look when thinking about all of them get there, who don't woman or anything, but what's important mark on it yet but.
But.
Cynthia regulators are now asking the trust companies to be more actively managing trust caught up I think the.
Hi, the temporary applause to facilitate a loans will be longer than before.
I wouldn't expect much agenda.
Okay.
Just remember that Oh, Oh from went on I don't mean or thought you got Lucky book topically administered by exactly.
Back on your shopping anything doesn't end up based on our order on <unk> dollars from first quarter to the third quarter. We are my line, you're focusing on facilitating why your loans.
No. Most of you know, it's a little from your phone cardiogenic.
Shock in the peak 30 day once it.
Yes, I think on I don't want you guys you guys. He got that.
She ashar, yet because I think the challenge back on your toward growth trend up a joint funding cheap study.
I think Thats example, that'd be good.
All right through the channel.
And.
As I introduced just now if on a we are true real drugs. The a cap on the loans on the interest rate on the loans that facility late my shift our focus back to the three year loans.
In the November and December.
Okay, great. Thank you.
Mhm.
But again if you have a question. Please press Star then one.
This concludes our question and answer session I would like to turn the conference back over to Matthew low for closing remarks. Please go ahead Sir.
That will be all for today. Thank you all for joining on if you have any further questions. Please feel free to contact our IR services at IR at <unk>, China. That's again thank you.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
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