GUANGZHOU, China, Aug. 21, 2017 (GLOBE NEWSWIRE) -- Fanhua Inc., (Nasdaq:FANH), (the "Company" or "Fanhua"), a
leading independent online-to-offline ("O2O") financial services provider in China, today announced its unaudited financial results
for the second quarter ended June 30, 20171.
Financial Highlights for the Second quarter of
2017:
|
(In thousands, except per ADS) |
2016 Q2
（RMB） |
2017 Q2
(RMB) |
2017 Q2
(US$) |
Change
% |
| Total net
revenues |
1,066,054 |
|
1,012,972 |
149,422 |
-5.0 |
| Operating
(loss) income |
(8,182 |
) |
71,208 |
10,504 |
N/A |
Net income
attributable to
the Company’s shareholders |
30,999 |
|
140,347 |
20,702 |
352.7 |
| Diluted net
income per ADS |
0.51 |
|
2.20 |
0.32 |
328.1 |
Financial Highlights for the First half of 2017:
|
(In thousands, except per ADS) |
First Half 2016
（RMB） |
First Half 2017
(RMB) |
First Half 2017
(US$) |
Change
% |
| Total net
revenues |
1,973,918 |
|
2,480,352 |
365,872 |
25.7 |
| Operating
(loss) income |
(28,180 |
) |
134,410 |
19,827 |
N/A |
Net income
attributable to
the Company’s shareholders |
50,359 |
|
210,087 |
30,989 |
317.2 |
| Diluted net
income per ADS |
0.84 |
|
3.37 |
0.50 |
303.7 |
Driven by rapid growth in our life insurance business, we recorded RMB71.2 million in operating income for the
second quarter of 2017, beating expectations. We also achieved RMB140.3 million in net income attributable to the Company’s
shareholders, representing a year-on-year increase of 352.7%." Commenting on the financial results of the second quarter of 2017,
Mr. Chunlin Wang, Chief Executive Officer of Fanhua, stated, "In spite of the challenge of an industry-wide product adjustment,
Fanhua still managed to grow its life insurance premiums 88.9% year-on-year, significantly outpacing the industry, among which
first year premiums on term life insurance products and renewal premiums grew 131.3% and 56.8% on a year-on-year basis,
respectively. Of particular note, we took pride in the fact that the 13-month persistency ratio of the term life insurance products
that we distributed improved to 93.3% from 89% a year ago, reflecting the recognition of Fanhua’s high products and service quality
by our customers.
"During the second quarter of 2017, as part of our efforts to develop our life insurance business through
expanding and strengthening our sales force, we abandoned certain channels of our P&C business, which has been suffering from
declining margins and devoted more resources to advancing our life insurance business. Despite a short-term negative impact on
total net revenue brought about by this move, we believe that, from a long term perspective, it will further optimize our company’s
business structure and improve our profitability.
"Building on the progress made in the first half of 2017, during the second half of 2017 we will channel more
resources to building up our platform and operating capability. We will focus on the key areas of regional expansion, office setup,
staff recruitment, assembling our sales team, sales agent management system development, as well as marketing and training, in
order to set the stage for sustained and rapid growth of our life insurance business in the years to come."
Financial Results for the Second Quarter of 2017
Total net revenues were RMB1.0 billion (US$149.4 million) for the second quarter of 2017,
representing a decrease of 5.0% from RMB1.1 billion for the corresponding period in 2016.
- Net revenues for the life insurance business were
RMB590.3 million (US$87.1 million) for the second quarter of 2017, representing an increase of 187.9% from RMB205.0 million for
the corresponding period in 2016. The increase was due to i) growth in sales agents; ii) implementation of our cross-selling
strategy and iii) recognition of more performance bonuses in the second quarter of 2017. Revenues generated from our life
insurance business accounted for 58.2% of our total net revenues.
- Net revenues for the P&C insurance business were RMB350.0 million (US$51.6 million) for the second
quarter of 2017, representing a decrease of 55.1% from RMB780.3 million for the corresponding period in 2016. The decrease was
primarily due to our efforts to abandon lower margin channel businesses starting from the second quarter of 2017 and the
suspension of business cooperation with PICC Property and Casualty Company Limited (“PICC P&C”) starting from March 1, 2017.
Revenues generated from the P&C insurance business accounted for 34.6% of our total net revenues in the second quarter of
2017.
- Net revenues for the claims adjusting business were RMB72.7 million (US$10.7 million) for the second quarter
of 2017, representing a decrease of 10.0% from RMB80.8 million for the corresponding period in 2016. The decrease was primarily
due to suspension of business cooperation with PICC P&C. Revenues generated from the claims adjusting business
accounted for 7.2% of our total net revenues in the second quarter of 2017.
Total operating costs and expenses were RMB941.8 million (US$138.9 million) for the second
quarter of 2017, representing a decrease of 12.3% from RMB1.1 billion for the corresponding period in 2016.
- Commission costs were RMB743.9 million (US$109.7 million) for the second quarter of 2017, representing a
decrease of 9.3% from RMB820.0 million for the corresponding period in 2016.
- Costs of the life insurance business were RMB375.3 million (US$55.4 million) for the second quarter of
2017, representing an increase of 174.2% from RMB136.9 million for the corresponding period in 2016. The increase was in line
with the growth in sales. Costs incurred by the life insurance business accounted for 50.4% of our total commission costs in the
second quarter of 2017.
- Costs of the P&C insurance business were
RMB325.6 million (US$48.0 million) for the second quarter of 2017, representing a decrease of 48.9% from RMB637.7 million for the
corresponding period in 2016. The decrease was primarily in line with the decline in sales, partially offset by the increased
rate of commissions paid to sales agents. Costs incurred by the P&C insurance business accounted for 43.8% of our total
commission costs in the second quarter of 2017.
- Costs of claims adjusting business were RMB43.0 million (US$6.3 million) for the second quarter of
2017, representing a decrease of 5.1% from RMB45.4 million for the corresponding period in 2016. Costs incurred by the claims
adjusting business accounted for 5.8% of our total commission costs in the second quarter of 2017.
- Selling expenses were RMB53.7 million (US$7.9 million) for the second quarter of 2017, representing a
decrease of 61.7% from RMB140.4 million for the corresponding period in 2016. The decrease was primarily because promotional
marketing expenses were paid to sales agents in the second quarter of 2016 while no promotional marketing plan of such nature was
launched in the year of 2017.
- General and administrative expenses were RMB144.1 million
(US$21.3 million) for the second quarter of 2017, representing an increase of 26.6% from RMB113.9 million for the corresponding
period in 2016. The increase was primarily due to an increase in expenses incurred by new office setup and staff recruitment as a
result of regional expansion.
As a result of the preceding factors, we had an operating income of RMB71.2 million (US$10.5
million) for the second quarter of 2017, as compared to an operating loss of RMB8.2 million for the corresponding period in
2016.
Operating margin was 7.0% for the second quarter of 2017, compared to negative 0.8% for the
corresponding period in 2016. The increase was primarily due to the increase in sales of regular term life insurance policies which
have higher profit margins.
Investment income was RMB97.9 million (US$14.4 million) for the second quarter of 2017,
representing an increase of 267.6% from RMB26.6 million for the corresponding period in 2016. The investment income represented
yields from short-term investments in financial products which mainly consist of inter-bank deposits or collective trust products
with terms ranging from half a year to two years and interest payable on a quarterly, semi-annual or annual basis. Our investment
income fluctuates from quarter to quarter because investment income is recognized when received.
Interest income was RMB2.0 million (US$0.3 million) for the second quarter of 2017, representing an increase of
6.6% from RMB1.8 million for the corresponding period in 2016.
Income tax expense was RMB50.8 million (US$7.5 million) for the second quarter of 2017,
representing an increase of 29.2 times from RMB1.7 million for the corresponding period in 2016. The increase was primarily due to
an increase in operating income and investment income. The effective tax rate for the second quarter of 2017 was 28.2% compared
with 6.9% for the corresponding period in 2016. The increase in effective tax rate was primarily due to operating losses of some of
our subsidiaries in the second quarter of 2017 which are not expected to be compensated by future profits, and therefore we
reserved the full amount of provisions for the deferred corporate income tax assets resulted from these operating losses.
Share of income of affiliates was RMB12.0 million (US$1.8 million) for the second quarter of
2017, representing an increase of 6.8% from RMB11.2 million for the corresponding period in 2016, mainly attributable to an
increase of profits from Sincere Fame International Limited, a company in which we own 20.6% of the equity interest.
Net income attributable to the Company’s shareholders was RMB140.3 million (US$20.7 million)
for the second quarter of 2017, representing an increase of 352.7% from RMB31.0 million for the corresponding period in 2016.
Net margin was 13.9% for the second quarter of 2017 compared with 2.9% for the corresponding
period in 2016.
Basic and diluted net income per ADS were RMB2.28 (US$0.34)
and RMB2.20 (US$0.32) for the second quarter of 2017, respectively, representing increases of 326.1% and 328.1% from RMB0.53 and
RMB0.51 for the corresponding period in 2016.
As of June 30, 2017, the Company had RMB3.0 billion (US$442.8 million) in cash, cash
equivalents and short term investments.
Financial Results for the First Half of
2017
Total net revenues were RMB2.5 billion (US$365.9 million) for the first half of 2017,
representing an increase of 25.7% from RMB2.0 billion for the corresponding period in 2016.
- Net revenues for the life insurance business were RMB1.2
billion (US$177.5 million) for the first half of 2017, representing an increase of 229.8% from RMB365.0 million for the
corresponding period in 2016. The increase was due to growth in the number of sales agents, implementation of our cross-selling
strategy and industry growth. Revenues generated from our life insurance business accounted for 48.5% of our total net revenues
during the first half of 2017.
- Net revenues for the P&C insurance business were RMB1.1 billion (US$168.1 million) for the first half of
2017, representing a decrease of 22.0% from RMB1.5 billion for the corresponding period in 2016. The decrease was primarily due
to our efforts to abandon lower margin channel businesses starting from the second quarter of 2017 and suspension of our business
cooperation with PICC P&C since March 1, 2017. Revenues generated from the P&C insurance business accounted for 46.0% of
our total net revenues in the first half of 2017.
- Net revenues for the claims adjusting business were RMB137.3 million (US$20.2 million) for the first half of
2017, representing a decrease of 7.3% from RMB148.1 million for the corresponding period in 2016. The decrease was primarily due
to suspension of our business cooperation with PICC P&C. Revenues generated from the claims adjusting business accounted for
5.5% of our total net revenues in the first half of 2017.
Total operating costs and expenses were RMB2.3 billion (US$346.0 million) for the first half of
2017, representing an increase of 17.2% from RMB2.0 billion for the corresponding period in 2016.
- Commission costs were RMB2.0 billion (US$289.3 million) for the first half of 2017, representing an increase
of 28.3% from RMB1.5 billion for the corresponding period in 2016.
- Costs of the life insurance business were RMB810.4 million (US$119.5 million) for the first half of
2017, representing an increase of 229.1% from RMB246.2 million for the corresponding period in 2016. The increase was in line
with the growth in sales. Costs incurred by the life insurance business accounted for 41.3% of our total commission costs in the
first half of 2017.
- Costs of the P&C insurance business were RMB1.1
billion (US$156.0 million) for the first half of 2017, representing a decrease of 11.0% from RMB1.2 billion for the corresponding
period in 2016. The decrease was primarily in line with the decline in sales, partially offset by an increased rate of
commissions paid to sale agents. Costs incurred by the P&C insurance business accounted for 53.9% of our total commission
costs in the first half of 2017.
- Costs of claims adjusting business were RMB93.3 million (US$13.8 million) for the first half of 2017,
representing a decrease of 0.4% from RMB93.7 million for the corresponding period in 2016. Costs incurred by the claims adjusting
business accounted for 4.8% of our total commission costs in the first half of 2017.
- Selling expenses were RMB106.1 million (US$15.7 million) for the first half of 2017, representing a decrease
of 57.5% from RMB249.5 million for the corresponding period in 2016. The decrease was primarily because promotional marketing
expenses were paid to sales agents in the first half of 2016 while no promotional marketing plan of such nature was launched in
the year of 2017.
- General and administrative expenses were RMB278.3 million
(US$41.1 million) for the first half of 2017, representing an increase of 24.4% from RMB223.8 million for the corresponding
period in 2016. The increase was primarily due to an increase in expenses incurred by new office setup and staff recruitment as a
result of regional expansion.
As a result of the preceding factors, we had an operating income of RMB134.4 million (US$19.8
million) for the first half of 2017, as compared to an operating loss of RMB28.2 million for the corresponding period in 2016.
Operating margin was 5.4% for the first half of 2017, compared to negative 1.4% for the
corresponding period in 2016. The increase was primarily due to the increase in sales of regular term life insurance policies which
have a higher profit margin.
Investment income was RMB108.2 million (US$16.0 million) for the first half of 2017,
representing an increase of 151.1% from RMB43.1 million for the corresponding period in 2016. The investment income represented
yields from short-term investments in financial products which mainly consist of inter-bank deposits or collective trust products
with terms ranging from half a year to two years and interest payable on a quarterly, semi-annual or annual basis. Our investment
income fluctuates from quarter to quarter because investment income is recognized when received.
Interest income was RMB2.5 million (US$0.4 million) for the first half of 2017, representing a
decrease of 60.3% from RMB6.4 million for the corresponding period in 2016. The decrease in interest income was primarily due to
decreases in term deposits as a result of increases in short-term investments.
Income tax expense was RMB79.3 million (US$11.7 million) for the first half of 2017,
representing an increase of 37.2 times from RMB2.1 million for the corresponding period in 2016. The increase was primarily due to
an increase in operating income and investment income. The effective tax rate for the first half of 2017 was 31.0% compared with
6.8% for the corresponding period in 2016. The increase in effective tax rate was primarily due to operating losses of some of our
subsidiaries in the first half year of 2017 which are not expected to be compensated by future profits, and therefore we reserved
the full amount of provisions for the deferred corporate income tax assets resulted from these operating losses.
Share of income of affiliates was RMB29.7 million (US$4.4 million) for the first half of 2017,
representing an increase of 39.1% from RMB21.3 million for the corresponding period in 2016, mainly attributable to an increase of
profits from Sincere Fame International Limited, in which the Company owns 20.6% of the equity interests.
Net income attributable to the Company’s shareholders was RMB210.1 million (US$31.0 million)
for the first half of 2017, representing an increase of 317.2% from RMB50.4 million for the corresponding period in 2016.
Net margin was 8.5% for the first half of 2017 compared with 2.6% for the corresponding period
in 2016.
Basic and diluted net income per ADS were RMB3.50 (US$0.52)
and RMB3.37 (US$0.50) for the first half of 2017, respectively, representing increases of 302.7% and 303.7% from RMB0.87 and
RMB0.84 for the corresponding period in 2016.
Key Operational Metrics for Fanhua's Online Initiatives for the Second quarter of 2017:
- CNpad Mobile Application ("CNpad App") - Our proprietary mobile sales support system:
- CNpad App had been downloaded and activated 294,228 times as of June 30, 2017,
representing an increase of 114.9% from 136,909 times as of June 30, 2016;
- The number of active users2 of CNpad App was 60,234 in the second quarter
of 2017, representing an increase of 110.1% from 28,675 in the second quarter of 2016;
- Insurance premiums generated through CNpad App were
RMB923.3 million (US$136.2 million) in the second quarter of 2017, representing an increase of 23.1% from RMB750.2 million for
the corresponding period of 2016 and accounted for 44.3% of our total insurance premiums in the second quarter of 2017 as
compared to 22.0% for the corresponding period of 2016.
- eHuzhu - Our online non-profit mutual aid platform:
- The number of registered members was 1.8 million as of June 30, 2017, representing an
increase of 111.5% from 872,922 as of June 30, 2016.
-
Baoxian.com - Our online insurance
platform:
- The number of registered customer accounts was 1.0 million as of June 30, 2017,
representing an increase of 189.3% from approximately 356,000 as of June 30, 2016.
- The number of active customer accounts3 was 45,520 in the second quarter of 2017,
representing an increase of 84.1% from 24,724 in the corresponding period of 2016;
- Insurance premiums generated on or through Baoxian.com was RMB44.7 million (US$6.6 million) in the
second quarter of 2017, representing an increase of 131.8% from RMB19.3 million in the corresponding period of 2016.
Recent Development
- On June 15, 2017, in recognition of its extraordinary performance in the internet insurance sector, Baoxian.com was awarded
Outstanding Internet Insurance Platform for the Year 2016 during the 2017 China Internet Insurance Conference held by China’s
Insurance Quote, one of the most authoritative insurance trade publications in China. Mr. Anlin Hu, CEO of Baoxian.com, was
recognized as Internet Insurance Leader of the Year 2016 in the event.
- On June 13, 2017, Fanhua Insurance Surveyors & Loss Adjustors Co., Ltd., or FISLA, a subsidiary of Fanhua, entered into a
framework agreement with Jintai Property & Casualty Insurance Co., Ltd., or Jintai, for a long-term comprehensive strategic
partnership. Both parties will reinforce their cooperative efforts at both the headquarters and branch level, in order to provide
better service experience for Jintai’s customers.
- On May 27, 2017, Fanhua signed a headquarter-to-headquarter agreement with Evergrande Life Insurance Co., Ltd., or Evergrande
Life. Both parties will engage in comprehensive cooperation on product sales, product development and value-added services for
their customers. Evergrande Life, a subsidiary of Evergrande Group, one of the largest real estate conglomerates in China,
primarily focuses on the life insurance, health insurance and casualty insurance businesses.
- Fanhua had 328,267 sales agents and 1,228 professional claims adjustors as of June 30, 2017, compared with
151,532 sales agents, and 1,352 professional claims adjustors as of June 30, 2016. As of June 30, 2017, Fanhua’s distribution
network consisted of 856 sales outlets operating in 21 provinces, compared with 494 sales outlets operating in 19 provinces
as of June 30, 2016. Its claims adjusting service network covered 29 provinces with 156 service outlets as of June 30, 2017,
compared with 153 service outlets in 29 provinces as of June 30, 2016.
Business Outlook
Fanhua expects its operating income to be no less than RMB50.0 million for the third quarter of 2017. This
forecast reflects Fanhua’s current view, which is subject to change.
Conference Call
The Company will host a conference call to discuss its second quarter and first half 2017 financial results as
per the following details.
| Time: 9:00 PM Eastern Daylight Time on August 21, 2017 |
| or 9:00 AM Beijing/Hong Kong Time on August 22, 2017 |
| |
| The toll free dial-in numbers: |
|
| United States |
1-855-500-8701 |
| United Kingdom |
0800-015-9724 |
| France |
0800-918-648 |
| Germany |
0800-184-4876 |
| Australia |
1-300-713-759 |
| Canada |
1-855-757-1565 |
| Taiwan |
0080-665-1951 |
| Hong Kong |
800-906-606 |
| |
|
| The toll dial-in numbers: |
|
| China (Mainland) |
400-120-0654 |
| Singapore & Other Areas |
+ 65-6713-5440 |
| |
| Conference ID #: |
64223082 |
Additionally, a live and archived web cast of this call will be available at: http://ir.fanhuaholdings.com/events.cfm
About Fanhua Inc.
Fanhua Inc. is a leading independent online-to-offline financial services provider. Through our online platforms
and offline sales and service network, we offer a wide variety of financial products and services to individuals and businesses,
including property and casualty and life insurance products. We also provide insurance claims adjusting services, such as damage
assessments, surveys, authentications and loss estimations.
Our online platforms include (1) CNpad, a mobile sales support application, (2) Baoxian.com, an online entry
portal for comparing and purchasing health, accident, travel and homeowner insurance products; and (3) eHuzhu (www.ehuzhu.com), a non-profit online mutual aid platform in China.
As of June 30, 2017, our distribution and service network consisted of 328,267 sales agents and 1,228
professional claims adjustors with 1,012 sales and service outlets covering 29 provinces.
For more information about Fanhua Inc., please visit http://ir.fanhuaholdings.com/.
Forward-looking Statements
This press release contains statements of a forward-looking nature. These statements, including the statements
relating to the Company’s future financial and operating results, are made under the “safe harbor” provisions of the U.S. Private
Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as “will,”
“expects,” “believes,” “anticipates,” “intends,” “estimates” and similar statements. Among other things, management's quotations
and the Business Outlook section contain forward-looking statements. These forward-looking statements involve known and unknown
risks and uncertainties and are based on current expectations, assumptions, estimates and projections about Fanhua and the
industry. Potential risks and uncertainties include, but are not limited to, those relating to its ability to attract and retain
productive agents, especially entrepreneurial agents, its ability to maintain existing and develop new business relationships with
insurance companies, its ability to execute its growth strategy, its ability to adapt to the evolving regulatory environment in the
Chinese insurance industry, its ability to compete effectively against its competitors, quarterly variations in its operating
results caused by factors beyond its control and macroeconomic conditions in China and their potential impact on the sales of
insurance products. All information provided in this press release is as of the date hereof, and Fanhua undertakes no obligation to
update any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations,
except as may be required by law. Although Fanhua believes that the expectations expressed in these forward-looking statements are
reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results
may differ materially from the anticipated results. Further information regarding risks and uncertainties faced by Fanhua is
included in Fanhua's filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F.
| |
| FANHUA
INC. |
| Unaudited Condensed
Consolidated Balance Sheets |
| (In thousands) |
| |
| |
As of December 31, |
|
As of June 30, |
|
As of June 30, |
| |
2016 |
|
2017 |
|
2017 |
| |
RMB |
|
RMB |
|
US$ |
| ASSETS: |
|
|
|
|
|
| Current assets: |
|
|
|
|
|
| Cash and cash equivalents |
240,242 |
|
621,303 |
|
91,647 |
| Restricted cash |
33,737 |
|
87,830 |
|
12,956 |
| Short term investments |
2,797,842 |
|
2,380,694 |
|
351,171 |
| Accounts receivable, net |
502,975 |
|
492,040 |
|
72,580 |
| Insurance premium receivables |
187 |
|
305 |
|
45 |
| Other receivables |
49,186 |
|
78,915 |
|
11,640 |
| Amounts due from related parties |
32,495 |
|
433,943 |
|
64,010 |
| Other current assets |
37,900 |
|
43,101 |
|
6,358 |
| Total current assets |
3,694,564 |
|
4,138,131 |
|
610,407 |
| |
|
|
|
|
|
| Non-current assets: |
|
|
|
|
|
| Property, plant, and equipment, net |
31,414 |
|
31,651 |
|
4,669 |
| Goodwill and intangible assets, net |
181,549 |
|
164,533 |
|
24,270 |
| Deferred tax assets |
8,277 |
|
32,510 |
|
4,795 |
| Investment in affiliates |
294,576 |
|
323,723 |
|
47,752 |
| Other non-current assets |
28,188 |
|
28,188 |
|
4,158 |
| Total non-current assets |
544,004 |
|
580,605 |
|
85,644 |
| Total assets |
4,238,568 |
|
4,718,736 |
|
696,051 |
| |
| Current liabilities: |
|
|
|
|
|
| Accounts payable |
278,188 |
|
369,825 |
|
54,552 |
| Insurance premium payables |
5,491 |
|
13,706 |
|
2,022 |
| Other payables and accrued expenses |
314,051 |
|
227,496 |
|
33,557 |
| Accrued payroll |
59,201 |
|
81,570 |
|
12,032 |
| Income tax payable |
90,188 |
|
135,591 |
|
20,001 |
| Dividend payable |
— |
|
15,033 |
|
2,218 |
| Total current liabilities |
747,119 |
|
843,221 |
|
124,382 |
| |
|
|
|
|
|
| Non-current liabilities: |
|
|
|
|
|
| Other tax liabilities |
72,778 |
|
72,612 |
|
10,711 |
| Deferred tax liabilities |
14,577 |
|
13,872 |
|
2,046 |
| Total non-current liabilities |
87,355 |
|
86,484 |
|
12,757 |
| Total liabilities |
834,474 |
|
929,705 |
|
137,139 |
| |
|
|
|
|
|
| Ordinary shares |
8,658 |
|
9,174 |
|
1,353 |
| Additional paid-in capital |
2,301,655 |
|
2,461,774 |
|
363,131 |
| Statutory reserves |
311,590 |
|
301,590 |
|
44,487 |
| Retained earnings |
1,018,928 |
|
1,239,015 |
|
182,765 |
| Accumulated other comprehensive loss |
(65,844) |
|
(76,794) |
|
(11,328) |
| Subscription receivables |
(288,135) |
|
(259,153) |
|
(38,227) |
| Total shareholders’ equity |
3,286,852 |
|
3,675,606 |
|
542,181 |
| Non-controlling interests |
117,242 |
|
113,425 |
|
16,731 |
| Total equity |
3,404,094 |
|
3,789,031 |
|
558,912 |
| Total liabilities and equity |
4,238,568 |
|
4,718,736 |
|
696,051 |
| |
|
| FANHUA INC. |
|
| Unaudited Condensed Consolidated Statements
of Income and Comprehensive Income |
|
| (In thousands, except
for shares and per share data) |
|
| |
|
| |
For The Three Months
Ended
|
|
For The Six Months
Ended |
| |
June 30,
|
|
June 30, |
| |
2016 |
|
2017 |
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
| |
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
|
| Net revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
| Life insurance Business |
205,020 |
|
590,258 |
|
87,068 |
|
364,951 |
|
1,203,649 |
|
177,548 |
|
| P&C insurance Business |
780,270 |
|
350,026 |
|
51,632 |
|
1,460,916 |
|
1,139,430 |
|
168,075 |
|
| Claims adjusting Business |
80,764 |
|
72,688 |
|
10,722 |
|
148,051 |
|
137,273 |
|
20,249 |
|
| Total net revenues |
1,066,054 |
|
1,012,972 |
|
149,422 |
|
1,973,918 |
|
2,480,352 |
|
365,872 |
|
| Operating costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
| Life insurance Business |
(136,888 |
) |
(375,282 |
) |
(55,357 |
) |
(246,245 |
) |
(810,392 |
) |
(119,539 |
) |
| P&C insurance Business |
(637,737 |
) |
(325,615 |
) |
(48,031 |
) |
(1,188,816 |
) |
(1,057,784 |
) |
(156,032 |
) |
| Claims adjusting Business |
(45,360 |
) |
(43,033 |
) |
(6,348 |
) |
(93,699 |
) |
(93,336 |
) |
(13,768 |
) |
| Total operating costs |
(819,985 |
) |
(743,930 |
) |
(109,736 |
) |
(1,528,760 |
) |
(1,961,512 |
) |
(289,339 |
) |
| Selling expenses |
(140,395 |
) |
(53,710 |
) |
(7,923 |
) |
(249,527 |
) |
(106,118 |
) |
(15,653 |
) |
| General and administrative expenses |
(113,856 |
) |
(144,124 |
) |
(21,259 |
) |
(223,811 |
) |
(278,312 |
) |
(41,053 |
) |
| Total operating costs and expenses |
(1,074,236 |
) |
(941,764 |
) |
(138,918 |
) |
(2,002,098 |
) |
(2,345,942 |
) |
(346,045 |
) |
| Income (loss) from operations |
(8,182 |
) |
71,208 |
|
10,504 |
|
(28,180 |
) |
134,410 |
|
19,827 |
|
| Other income, net: |
|
|
|
|
|
|
|
|
|
|
|
|
| Investment income |
26,626 |
|
97,890 |
|
14,440 |
|
43,086 |
|
108,178 |
|
15,957 |
|
| Interest income |
1,835 |
|
1,957 |
|
289 |
|
6,353 |
|
2,524 |
|
372 |
|
| Others, net |
4,241 |
|
9,190 |
|
1,355 |
|
9,482 |
|
10,801 |
|
1,593 |
|
| Income before income taxes and income of
affiliates |
24,520 |
|
180,245 |
|
26,588 |
|
30,741 |
|
255,913 |
|
37,749 |
|
| Income tax expense |
(1,683 |
) |
(50,811 |
) |
(7,495 |
) |
(2,077 |
) |
(79,336 |
) |
(11,703 |
) |
| Share of income of affiliates |
11,249 |
|
12,024 |
|
1,773 |
|
21,339 |
|
29,693 |
|
4,380 |
|
| Net income |
34,086 |
|
141,458 |
|
20,866 |
|
50,003 |
|
206,270 |
|
30,426 |
|
| less: net income (loss) attributable to noncontrolling
interests |
3,087 |
|
1,111 |
|
164 |
|
(356 |
) |
(3,817 |
) |
(563 |
) |
| Net income attributable to the Company’s
shareholders |
30,999 |
|
140,347 |
|
20,702 |
|
50,359 |
|
210,087 |
|
30,989 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Net income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
0.03 |
|
0.11 |
|
0.02 |
|
0.04 |
|
0.18 |
|
0.03 |
|
| Diluted |
0.03 |
|
0.11 |
|
0.02 |
|
0.04 |
|
0.17 |
|
0.02 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Net income per ADS: |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
0.53 |
|
2.28 |
|
0.34 |
|
0.87 |
|
3.5 |
|
0.52 |
|
| Diluted |
0.51 |
|
2.2 |
|
0.32 |
|
0.84 |
|
3.37 |
|
0.5 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Shares used in calculating net income per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic |
1,159,471,268 |
1,231,971,654 |
1,231,971,654 |
1,157,270,347 |
1,198,884,443 |
1,198,884,443 |
| Diluted |
1,206,953,720 |
|
1,276,541,316 |
|
1,276,541,316 |
|
1,204,692,713 |
|
1,245,046,426 |
|
1,245,046,426 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Net income |
34,086 |
|
141,458 |
|
20,866 |
|
50,003 |
|
206,270 |
|
30,426 |
|
| Other comprehensive income (loss), net of tax: Foreign currency translation
adjustments |
6,195 |
|
(2,820 |
) |
(415 |
) |
4,897 |
|
(2,979 |
) |
(438 |
) |
| Fair value changes |
— |
|
(896 |
) |
(132 |
) |
— |
|
(632 |
) |
(93 |
) |
| Share of other comprehensive gain (loss) of affiliates |
(8,718 |
) |
911 |
|
134 |
|
(28,361) |
|
(546) |
|
(81) |
|
| Comprehensive income |
31,563 |
|
138,653 |
|
20,453 |
|
26,539 |
|
202,113 |
|
29,814 |
|
| Less: Comprehensive income (loss) attributable to the noncontrolling
interests |
3,087 |
|
1,111 |
|
164 |
|
(356 |
) |
(3,817 |
) |
(563 |
) |
| Comprehensive income attributable to the Company’s
shareholders |
28,476 |
|
137,542 |
|
20,289 |
|
26,895 |
|
205,930 |
|
30,377 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
| FANHUA INC. |
| Unaudited Condensed
Consolidated Statements of Cash Flow |
| (In thousands) |
| |
| |
For The Three Months
Ended
|
|
For The Six Months
Ended
|
|
| |
June
30,
|
|
June
30,
|
|
| |
2016 |
|
2017 |
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
| |
RMB |
|
RMB |
|
US$ |
|
RMB |
|
RMB |
|
US$ |
|
| OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
|
|
|
|
| Net income |
34,086 |
|
141,458 |
|
20,866 |
|
50,003 |
|
206,270 |
|
30,426 |
|
| Adjustments to reconcile net income to net cash (used in)
generated from operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
| Depreciation |
3,331 |
|
4,025 |
|
594 |
|
6,675 |
|
7,728 |
|
1,140 |
|
| Amortization of intangible assets |
1,309 |
|
8,453 |
|
1,247 |
|
2,626 |
|
17,016 |
|
2,510 |
|
| Allowance for doubtful receivables |
(345 |
) |
1,237 |
|
182 |
|
(1,035 |
) |
8,906 |
|
1,314 |
|
| Compensation expenses associated with stock option |
2,042 |
|
— |
|
— |
|
4,937 |
|
— |
|
— |
|
| Investment income |
(11,839 |
) |
(93,649 |
) |
(13,814 |
) |
(20,937 |
) |
(99,913 |
) |
(14,738 |
) |
| Gain on disposal of subsidiaries |
（52 |
） |
— |
|
— |
|
(3,082 |
) |
(1,302 |
) |
(192 |
) |
| Loss (gain) on disposal of property, plant and
equipment |
— |
|
32 |
|
5 |
|
2 |
|
(2 |
) |
0 |
|
| Share of income of affiliates |
(11,249 |
) |
(12,024 |
) |
(1,773 |
) |
(21,339 |
) |
(29,693 |
) |
(4,380 |
) |
| Changes in operating assets and liabilities |
(95,256 |
) |
59,326 |
|
8,751 |
|
(73,116 |
) |
8,943 |
|
1,319 |
|
| Net cash (used in) generated from operating
activities |
(77,973 |
) |
108,858 |
|
16,058 |
|
(55,266 |
) |
117,953 |
|
17,399 |
|
| Cash flows (used in) generated from investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
| Purchase of property, plant and equipment |
(2,384 |
) |
(5,333 |
) |
(787 |
) |
(4,017 |
) |
(8,205 |
) |
(1,210 |
) |
| Proceeds from disposal of property and equipment |
24 |
|
18 |
|
3 |
|
48 |
|
56 |
|
8 |
|
| Purchase of short term investments |
(2,647,300 |
) |
(3,159,000 |
) |
(465,977 |
) |
(4,852,300 |
) |
(4,278,194 |
) |
(631,067 |
) |
| Proceeds from disposal of short term investments |
2,575,794 |
|
3,518,149 |
|
518,954 |
|
4,243,393 |
|
4,794,413 |
|
707,213 |
|
| Disposal of subsidiaries, net of cash |
22,890 |
|
20,867 |
|
3,078 |
|
29,326 |
|
14,350 |
|
2,117 |
|
| Purchase of intangible assets |
(20,000 |
) |
— |
|
— |
|
(20,000 |
) |
— |
|
— |
|
| Increase in amounts due from related parties |
— |
|
(370,000 |
) |
(54,578 |
) |
— |
|
(400,000 |
) |
(59,003 |
) |
| Net cash (used in) generated from investing
activities |
(70,976 |
) |
4,701 |
|
693 |
|
(603,550 |
) |
122,420 |
|
18,058 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Cash flows (used in) generated from
financing activities: |
|
|
|
|
|
|
| Acquisition of additional interest in subsidiaries |
(73,560 |
) |
— |
|
— |
|
(74,760 |
) |
— |
|
— |
|
| Proceeds on exercise of stock options |
1 |
|
6,866 |
|
1,013 |
|
2 |
|
10,702 |
|
1,578 |
|
| Proceeds of employee subscriptions |
— |
|
22,187 |
|
3,273 |
|
— |
|
22,187 |
|
3,273 |
|
| Proceeds of issuance of ordinary shares upon private placement |
— |
|
201,087 |
|
29,662 |
|
— |
|
201,087 |
|
29,662 |
|
| Dividends paid |
— |
|
(36,121 |
) |
(5,328 |
) |
— |
|
(36,121 |
) |
(5,328 |
) |
| Net cash (used in) generated from financing activities |
(73,559 |
) |
194,019 |
|
28,620 |
|
(74,758 |
) |
197,855 |
|
29,185 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Net (decrease) increase in cash, cash equivalents and restricted
cash |
(222,508 |
) |
307,578 |
|
45,371 |
|
(733,574 |
) |
438,228 |
|
64,642 |
|
| Cash, cash equivalents and restricted cash at beginning of
period |
621,724 |
|
404,435 |
|
59,657 |
|
1,132,851 |
|
273,979 |
|
40,414 |
|
| Effect of exchange rate changes on cash and cash equivalents |
(1,903 |
) |
(2,880 |
) |
(425 |
) |
(1,964 |
) |
(3,074 |
) |
(453 |
) |
| Cash, cash equivalents and restricted cash at end of
period |
397,313 |
|
709,133 |
|
104,603 |
|
397,313 |
|
709,133 |
|
104,603 |
|
| Interest paid |
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
| Income taxes paid |
721 |
|
48,033 |
|
7,085 |
|
3,328 |
|
55,162 |
|
8,137 |
|
| |
|
|
|
|
|
|
1 This announcement contains currency conversions of certain Renminbi (RMB) amounts into U.S. dollars (US$) at specified
rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a
rate of RMB 6.7793 to US$ 1.00, the effective noon buying rate as of June 30, 2017 in The City of New York for cable transfers of
RMB as set forth in the H.10 weekly statistical release of the Federal Reserve Board.
2 Active users are defined as users who made at least one purchase through CNpad App during the specified
period.
3 Active customer accounts are defined as customer accounts that made at least one purchase
directly through www.baoxian.com or its mobile application during the specified period.
For more information, please contact:
Oasis Qiu
Investor Relations Manager
Tel: +86 (20) 8388-3191
Email: qiusr@fanhuaholdings.com
Source: Fanhua Inc.
