FINANCIAL HIGHLIGHTS FOR THE FIRST HALF OF FISCAL YEAR 2019
- Net revenues increased by 39.7% to
RMB124.3 million (US$18.1 million ) fromRMB88.9 million for the same period of fiscal year 2018.
- Income from operations increased by 41.9% to
RMB52.4 million (US$7.6 million ) fromRMB36.9 million for the same period of fiscal year 2018.
- Net income increased by 30.5% to
RMB45.6 million (US$6.6 million ) fromRMB34.9 million for the same period of fiscal year 2018. Net income attributable to Puyi’s shareholders increased by 34.8% toRMB46.5 million (US$6.8 million ) fromRMB34.5 million for the same period of fiscal year 2018.
Mr.
“For the first half of fiscal year 2019, we were able to continue our growth in terms of both net revenues and net income. This growth is a reflection of the strengths in our business and our ability to implement our growth strategies.
For the first half of fiscal year 2019, net revenues generated from distribution of privately raised fund products significantly increased by 173.4% to
Our net revenues generated from distribution of publicly raised fund products significantly increased to
China’s economy is witnessing a continuing steady growth of per capita income and more recently, a continuing shift of investment focus from real properties to market-based wealth management products among Chinese population with investable assets. Such industry trend, coupled with the continuously strengthening supervision reining in commercial banks’ supply of wealth management products and breaking all implicit guarantees of product returns, would further drive the market-based wealth management products to gradually replace fixed income products, and further increase the demand for professional third-party wealth management service providers by our target clients with declined reliance on banks.
To prepare us for the enormous growth opportunities, we are implementing a series of strategies for the three fiscal years ending 2021. We would further expand our client base and increase the outstanding balance of distributed funds with continuing investments on development and sales of packaged publicly raised fund products on a dollar-cost averaging basis. In addition, we would allocate substantial resources to improve our IT infrastructure and strengthen our marketing and promotion activities. Although the greater investments under our development strategies would affect our net revenues and net income in short term, we believe we are able to gain long-term increases in the business scale and economies of scale, which would in turn contribute to the growth in our net revenues and net income in the long run.
In anticipation of our capital investment under the development strategies, we expect that the net income attributable to Puyi’s shareholders will be between
FINANCIAL RESULTS FOR THE FIRST HALF OF FISCAL YEAR 2019
Net revenues
Net revenues for the first half of fiscal year 2019 were
- Net revenues generated from our wealth management services for the first half of fiscal year 2019 were
RMB107.1 million (US$15.6 million ), representing a 33.4 % increase fromRMB80.3 million for the same period of fiscal year 2018.
- Net revenues generated from distribution of privately raised fund products for the first half of fiscal year 2019 wereRMB94.7 million (US$13.8 million ), representing a 173.4% increase fromRMB34.6 million for the same period of fiscal year 2018. The increase was primarily due to (i) recognition ofRMB40.0 million (US$5.8 million ) carried interest; and (ii) a significant increase in commissions for distribution of privately raised fund products.
- Net revenues generated from distribution of publicly raised fund products for the first half of fiscal year 2019 wereRMB1.4 million (US$0.2 million ), representing a significant increase fromRMB0.2 million for the same period of fiscal year 2018. The increase was primarily due to an increase in commission as a result of the significant increase in the distribution of publicly raised fund products (including packaged fund products).
- Net revenues generated from distribution of other financial products for the first half of fiscal year 2019 wereRMB11.1 million (US$1.6 million ), representing a 75.7% decrease fromRMB45.5 million for the same period of fiscal year 2018. This decrease was primarily due to our strategic downsizing of the distribution of non-fund products for long-term development.
- Net revenues generated from our asset management services for the first half of fiscal year 2019 were
RMB1.1 million (US$0.2 million ). We commenced our asset management services by launching two series of FoFs under our management inApril 2018 .
- Net revenues generated from our corporate finance services for the first half of fiscal year 2019 were
RMB15.0 million (US$2.2 million ), representing a significant increase from the same period of fiscal year 2018, due to increasing demand for such services.
- Net revenues generated from other services for the first half of fiscal year 2019 were
RMB1.1 million (US$0.2 million ), representing an 80.6% decrease fromRMB5.7 million for the same period of fiscal year 2018. The decrease was primarily due to the winding down of IT services we previously provided in the first half of fiscal year 2018 as we have transitioned it to become part of our internal information technology service function for the same period of fiscal year 2019.
Operating costs and expenses
Operating costs and expenses for the first half of fiscal year 2019 were
- Cost of sales for the first half of fiscal year 2019 were
RMB13.0 million (US$1.9 million ), representing a 26.4% decrease fromRMB17.7 million for the same period of fiscal year 2018. The decrease was primarily due to the increasing proportion of privately raised fund products distributed on a net-commission basis as opposed to on a gross-commission basis. The cost of sales on the net-commission basis was paid directly by the fund issuers instead of the Company.
- Selling expenses for the first half of fiscal year 2019 were
RMB33.6 million (US$4.9 million ), representing a 70.6% increase fromRMB19.7 million for the same period of fiscal year 2018. This increase was due to (i) our increased marketing and sales promotion activities on publicly raised fund products in line with our increasing focus on packaged fund products; and (ii) an increase in the number of investment advisors to support our marketing and sales promotion.
- General and administrative expenses for the first half of fiscal year 2019 were
RMB25.3 million (US$3.7 million ), representing a 72.8% increase fromRMB14.6 million for the same period of fiscal year 2018. The increase was primarily due to (i) an increase in rental cost for our office premises and other office expenses as a result of our business expansion; (ii) an increase in the number of administrative staff; and (iii) auditing fees and expenses related to our initial public offering (“IPO”) on theNASDAQ Global Market which cannot be capitalized.
Operating margin for the first half of fiscal year 2019 was 42.2%, representing an increase from 41.5% for the same period of fiscal year 2018.
Investment Income
Investment Income for the first half of fiscal year 2019 was
Interest Income
Interest income for the first half of fiscal year 2019 was
Income tax expenses
Income tax expenses for the first half of fiscal year 2019 were
Net income
Net income for first half of fiscal year 2019 was
Net income attributable to Puyi’s shareholders
Net income attributable to Puyi’s shareholders for the first half of fiscal year 2019 was
Basic and diluted earnings per ADS(2)
Basic and diluted earnings per ADS for the first half of fiscal year 2019 was
Cash, cash equivalents and restricted cash
As of
OPERATING DATA FOR THE FIRST HALF OF FISCAL YEAR 2019
Wealth Management Services
For the first half of fiscal year 2019, the total transaction value of privately raised fund products was
For the first half of fiscal year 2019, the total transaction value of publicly raised fund products was
Asset Management Services
For the first half of fiscal year 2019, the capital raised for the two series of FoFs under our asset management services increased by
Corporate Finance Services
For the first half of fiscal year 2019, our corporate finance services experienced rapid growth. We charge service fees equal to a percentage of total fund raised for corporate borrowers through such services. For the first half of fiscal year 2019, corporate borrowers we served raised
Group Structure Update
In
CONFERENCE CALL
Senior management will host a combined English and Chinese language conference call to discuss the Company’s unaudited financial results and business development for the first half of fiscal year 2019 ended
Dial-in details for the conference call are as follows:
| Date/Time: | Monday, April 29, 2019 at 9:00 PM U.S. Eastern Daylight Time | |
| (Tuesday, April 30, 2019 at 9:00 AM Beijing/Hong Kong Time) |
| The dial-in numbers: | |
| China (Mainland) | 400-620-8038 or 800-819-0121 |
| International | +65-6713-5090 |
| The toll-free dial-in numbers: | |
| United States | 1-866-519-4004 |
| United Kingdom | 0808-234-6646 |
| France | 0800-912-761 |
| Germany | 0800-182-0671 |
| Australia | 1-300-717-205 |
| Canada | 1-866-386-1016 |
| Taiwan | 0809-091-568 |
| Hong Kong | 800-906-601 |
Conference Title:
Conference ID #:1355917
Additionally, a live and archived webcast of the conference call will be available at Puyi’s investor relations website http://ir.puyiwm.com/news-events/events.
FOREIGN CURRENCY TRANSLATION
In this announcement, the unaudited financial results for the first half of fiscal year 2019 are stated in RMB. This announcement contains currency conversions of certain RMB amounts into US$ at specified rates solely for the convenience of the reader. Unless otherwise indicated, all translations from RMB to US$ are made at a rate of
SAFE HARBOR STATEMENT
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as “may,” “will,” “intend,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate” or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company’s expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following: the Company’s goals and strategies; the Company’s future business development; product and service demand and acceptance; changes in technology; economic conditions; the growth of the third-party wealth management industry in
_____________________________
(1) Dollar-cost averaging is a strategy that allows an investor to buy the same dollar amount of an investment on regular intervals, which encourages long-term holding investment strategy.
(2) On
Unaudited Condensed Consolidated Balance Sheets
(in thousands)
| As of | As of | |||||||||||
| June 30, | December 31, | December 31, | ||||||||||
| 2018 | 2018 | 2018 | ||||||||||
| RMB’000 | RMB’000 | USD’000 | ||||||||||
| ASSETS: | ||||||||||||
| Current assets: | ||||||||||||
| Cash and cash equivalents | 103,228 | 205,799 | 29,932 | |||||||||
| Restricted cash | 8,772 | 6,415 | 933 | |||||||||
| Short-term Investments | 5,010 | 2,000 | 291 | |||||||||
| Accounts receivable, net | 30,757 | 27,377 | 3,982 | |||||||||
| Commercial acceptance notes | 10,642 | 11,102 | 1,615 | |||||||||
| Due from related parties | 80 | 638 | 94 | |||||||||
| Other receivables | 5,729 | 10,606 | 1,543 | |||||||||
| Short-term loans receivable | 50,356 | 90 | 12 | |||||||||
| Total current assets | 214,574 | 264,027 | 38,402 | |||||||||
| Long-term investments | 5,000 | 4,000 | 582 | |||||||||
| Property and equipment, net | 890 | 1,771 | 258 | |||||||||
| Intangible assets, net | 700 | 388 | 56 | |||||||||
| Long-term prepayments | 461 | 881 | 128 | |||||||||
| Deferred tax assets | 4,241 | 2,482 | 360 | |||||||||
| Total assets | 225,866 | 273,549 | 39,786 | |||||||||
| LIABILITIES AND EQUITY: | ||||||||||||
| LIABILITIES: | ||||||||||||
| Current liabilities: | ||||||||||||
| Accounts payable | 3,677 | 2,820 | 410 | |||||||||
| Investors’ deposit | 8,772 | 6,415 | 933 | |||||||||
| Income taxes payable | 2,820 | 2,046 | 298 | |||||||||
| Due to shareholder for acquisition of subsidiaries | 2,116 | - | - | |||||||||
| Other tax liabilities | 8,700 | 8,900 | 1,294 | |||||||||
| Other payables and accrued expenses | 6,129 | 10,029 | 1,459 | |||||||||
| Total current liabilities | 32,214 | 30,210 | 4,394 | |||||||||
| Total liabilities | 32,214 | 30,210 | 4,394 | |||||||||
| Commitments and contingencies | ||||||||||||
| EQUITY: | ||||||||||||
| Ordinary shares | 529 | 557 | 81 | |||||||||
| Additional paid-in capital | 62,705 | 71,415 | 10,387 | |||||||||
| Statutory reserves | 14,152 | 18,014 | 2,620 | |||||||||
| Subscription receivable | - | (550 | ) | (80 | ) | |||||||
| Retained earnings | 107,407 | 150,040 | 21,822 | |||||||||
| Other comprehensive income | - | 91 | 13 | |||||||||
| Total Puyi Inc.’s equity | 184,793 | 239,567 | 34,843 | |||||||||
| Non-controlling interests | 8,859 | 3,772 | 549 | |||||||||
| Total equity | 193,652 | 243,339 | 35,392 | |||||||||
| Total liabilities and equity | 225,866 | 273,549 | 39,786 | |||||||||
Unaudited Condensed Consolidated Statements of
Income and Comprehensive Income
(In thousands, except for percentages)
| Six months ended | ||||||||||||||||
| December 31, 2017 |
December 31, 2018 |
December 31, 2018 |
||||||||||||||
| RMB’000 | RMB’000 | USD’000 | Change (%) |
|||||||||||||
| Net Revenues: | ||||||||||||||||
| Wealth management | 80,285 | 107,118 | 15,580 | 33.4 | % | |||||||||||
| Asset management | - | 1,055 | 153 | NA | ||||||||||||
| Corporate finance | 2,940 | 14,968 | 2,177 | 409.1 | % | |||||||||||
| IT and Other revenue | 5,707 | 1,109 | 161 | (80.6 | %) | |||||||||||
| Total net revenues | 88,932 | 124,250 | 18,071 | 39.7 | % | |||||||||||
| Operating costs and expenses: | ||||||||||||||||
| Cost of goods sold | (17,731 | ) | (13,046 | ) | (1,897 | ) | (26.4 | %) | ||||||||
| Selling expenses | (19,678 | ) | (33,569 | ) | (4,882 | ) | 70.6 | % | ||||||||
| General and administrative expenses | (14,623 | ) | (25,262 | ) | (3,674 | ) | 72.8 | % | ||||||||
| Total operating costs and expenses | (52,032 | ) | (71,877 | ) | (10,453 | ) | 38.1 | % | ||||||||
| Income from operations | 36,900 | 52,373 | 7,618 | 41.9 | % | |||||||||||
| Other income: | ||||||||||||||||
| Interest income | 587 | 854 | 124 | 45.5 | % | |||||||||||
| Interest expenses | - | (1,048 | ) | (152 | ) | NA | ||||||||||
| Investment income | 2,856 | 2,057 | 299 | (28.0 | %) | |||||||||||
| Other expense | 194 | 264 | 38 | 36.1 | % | |||||||||||
| Total other income | 3,637 | 2,127 | 309 | (41.5 | %) | |||||||||||
| Income before taxes | 40,537 | 54,500 | 7,927 | 34.4 | % | |||||||||||
| Income tax expense | (5,594 | ) | (8,913 | ) | (1,296 | ) | 59.3 | % | ||||||||
| Net income | 34,943 | 45,587 | 6,631 | 30.5 | % | |||||||||||
| Less: net loss attributable to non-controlling interests | 458 | (908 | ) | (132 | ) | (298.3 | %) | |||||||||
| Net income attributable to Puyi Inc.’s shareholders | 34,485 | 46,495 | 6,763 | 34.8 | % | |||||||||||
Unaudited Condensed Consolidated Statements of
Income and Comprehensive Income (Continued)
(In thousands, except for shares, income per share, income per ADS)
| Six months ended | ||||||||||||
| December 31, 2017 |
December 31, 2018 |
December 31, 2018 |
||||||||||
| RMB’000 | RMB’000 | USD’000 | ||||||||||
| Net income per share: | ||||||||||||
| Basic | 0.431 | 0.563 | 0.082 | |||||||||
| Diluted | 0.431 | 0.563 | 0.082 | |||||||||
| Net income per ADS(1): | ||||||||||||
| Basic | 0.647 | 0.845 | 0.123 | |||||||||
| Diluted | 0.647 | 0.845 | 0.123 | |||||||||
| Weighted average shares used in calculating net income per share: | ||||||||||||
| Basic | 80,000,000 | 82,578,859 | 82,578,859 | |||||||||
| Diluted | 80,000,000 | 82,578,859 | 82,578,859 | |||||||||
| Net income | 34,943 | 45,587 | 6,631 | |||||||||
| Other comprehensive income (loss) | - | 91 | 13 | |||||||||
| Comprehensive income | 34,943 | 45,678 | 6,644 | |||||||||
| Less: Comprehensive income attributable to the non-controlling interests | 458 | (908 | ) | (132 | ) | |||||||
| Comprehensive income attributable to Puyi Inc.’s shareholders | 34,485 | 46,586 | 6,776 | |||||||||
___________________________________
(1) On
Unaudited Condensed Consolidated Statements of Cash Flow
(In thousands)
| Six months ended | ||||||||||||
| December 31, 2017 |
December 31, 2018 |
December 31, 2018 |
||||||||||
| RMB’000 | RMB’000 | USD’000 | ||||||||||
| Net cash generated from operating activities | 52,844 | 46,257 | 6,725 | |||||||||
| Net cash generated from investing activities | 8,973 | 52,464 | 7,634 | |||||||||
| Net cash generated from financing activities | - | 1,402 | 203 | |||||||||
| Net increase in cash and cash equivalents, and restricted cash | 61,817 | 100,123 | 14,562 | |||||||||
| Cash, cash equivalents and restricted cash at beginning of period | 57,037 | 112,000 | 16,290 | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | - | 91 | 13 | |||||||||
| Cash, cash equivalents and restricted cash at end of period | 118,854 | 212,214 | 30,865 | |||||||||
Contacts:
Puyi Inc.
Jing He
GM of Financial Reporting Department
Email: ir@puyiwm.com
Tel: +86 20-28381666
Source: Puyi Inc.
