Financial Performance - The company recorded a net profit of RMB 302.1 million and adjusted net profit of RMB 303.5 million for the six months ended June 30, 2023, representing an increase of 47.8% and 47.4% compared to RMB 204.5 million and RMB 205.9 million for the same period in 2022 [25]. - Total revenue for the first half of 2023 reached RMB 1,917.6 million, a 21.2% increase compared to RMB 1,582.5 million in the same period of 2022 [38]. - The company reported a net profit of RMB 302.1 million, a decrease of 7.9% from RMB 328.0 million in the same period last year [38]. - The company's operating profit for the first half of 2023 was RMB 389.5 million, a decrease of 9.5% from RMB 430.4 million in the same period last year [38]. - Adjusted operating profit was RMB 390.9 million, down 9.9% from RMB 433.8 million in the same period last year, but up 46.8% from RMB 266.3 million for the six months ended December 31, 2022 [116]. - The company proposed a dividend of HKD 0.15 per share for the period, subject to shareholder approval [29]. Loan and Revenue Growth - The total loan volume facilitated during the period amounted to RMB 30.8 billion, representing 85.1% of the total loan realization, an increase of 39.7% from RMB 22.05 billion as of December 31, 2022 [31]. - The loan facilitation service fee increased by 59.6% to RMB 1,105.3 million, compared to RMB 692.4 million in the previous year [38]. - The loan realization amount reached RMB 36.2 billion, a historical high, representing a growth of 46.9% compared to RMB 24.64 billion for the same period in 2022 [52]. - The total loan amount for the first half of 2023 was RMB 362 billion, reflecting a growth of 31.4% compared to the second half of 2022 [41]. - The total amount of secured receivables was RMB 1,415,173 thousand, compared to RMB 628,229 thousand as of June 30, 2022 [17]. Risk Management and Credit Quality - The company continues to optimize its risk management framework to adapt to market and user behavior changes, ensuring a transition to higher-quality borrowers without compromising asset quality [30]. - The first payment default rate slightly increased to 0.64% in Q2 2023, while the one to three months overdue rate and three months or more overdue rate remained stable at 4.09% and 2.26% respectively [30]. - Credit impairment losses rose to RMB 148.3 million, up from RMB 68.2 million in the same period last year, primarily due to increased loan volume [32]. - The first payment overdue rate was stabilized at 0.64% for 2023, with the one to three months overdue rate at 4.09% [72]. - The three months overdue rate decreased from 2.49% in Q1 2023 to 2.26% in Q2 2023 [72]. Strategic Initiatives - The company plans to launch a localized consumer finance brand "CreFIT" in Hong Kong to diversify its business portfolio and expand its influence [24]. - The company agreed to acquire Banco Português de Gestão, S.A., a credit institution registered in Portugal, to seek new growth opportunities [24]. - The company plans to expand its business into different industries and regions, launching a localized consumer finance brand "CreFIT" in Hong Kong and acquiring BPG to enter the European market [67]. - The company is actively exploring potential business prospects for investment, collaboration, or acquisition in China and other jurisdictions [103]. Operational Efficiency and Technology - The company launched a new generation core business system (VOS) to enhance operational efficiency and improve user experience through AI-driven solutions [42]. - The company aims to enhance risk management capabilities through the development of technologies such as artificial intelligence [79]. Employee and Shareholder Information - The company had a total of 809 employees as of June 30, 2023 [161]. - The company’s directors and senior management held a total of 176,922,097 shares through controlled corporations, representing a significant portion of the issued shares [193]. - The company’s shareholding structure shows that Ma Ting-hsiung holds 39.85% of the issued shares personally and through controlled corporations [193]. Financial Position and Cash Flow - The asset-to-liability ratio decreased to approximately 59.7% from 62.1% as of December 31, 2022 [130]. - Cash outflow from financing activities was RMB 959.4 million, compared to RMB 1,469.4 million in the same period last year [134]. - The company recorded a net cash inflow from operating activities of RMB 578.6 million, down from RMB 1,424.3 million in the same period last year [133]. - The net cash inflow from investment activities was RMB 47.7 million, while the cash outflow for the same period was RMB 219.5 million, with the increase in net cash inflow primarily due to a decrease in structured deposits by RMB 190.0 million [154].

Financial Performance - Total revenue for the six months ended June 30, 2023, was RMB 1,917.6 million, representing a 21.2% increase from RMB 1,582.5 million in the same period of 2022[20] - The net profit for the six months ended June 30, 2023, was RMB 302.1 million, a decrease of 7.9% from RMB 328.0 million in the same period of 2022[20] - Operating profit for the six months ended June 30, 2023, was RMB 389.5 million, a decrease of 9.5% compared to RMB 430.4 million for the same period in 2022[101] - Non-IFRS adjusted net profit for the six months ended June 30, 2023, was RMB 303.5 million, down 8.4% from RMB 331.5 million for the same period in 2022[84] - Basic earnings per share for the period were RMB 0.62, compared to RMB 0.67 for the same period in 2022, reflecting a decline of about 7.5%[128] Revenue Sources - Loan facilitation service fees increased by 59.6% to RMB 1,105.3 million compared to RMB 692.4 million in the previous year[20] - The total interest income decreased by 31.2% to RMB 774.2 million from RMB 1,124.7 million in the same period of 2022[20] - The company reported a significant increase in other income, which rose by 182.6% to RMB 213.7 million compared to RMB 75.6 million in the previous year[20] Loan and Customer Metrics - The company achieved a loan volume of RMB 36.2 billion in the first half of 2023, a growth of 31.4% compared to the second half of 2022[34] - In the first half of 2023, repeat customers contributed 82.1% of the total loan amount[36] - The total loan origination volume for the first half of 2023 was RMB 36,198.1 million, a 31.4% increase from RMB 27,547.4 million in the same period of 2022[39] Risk Management and Strategy - The company has implemented a proactive risk management strategy, enhancing risk identification capabilities through upgraded risk models[22] - The company has focused on optimizing its business strategies and models to adapt to the evolving market and user behaviors[22] - The company aims to continuously develop technologies such as artificial intelligence to enhance risk management capabilities and ensure compliance with regulatory standards[71] Dividends and Shareholder Returns - The company plans to distribute an interim dividend of HKD 0.15 per share, up from HKD 0.10 per share in the previous year[21] Expenses and Cost Management - General and administrative expenses rose by 7.4% to RMB 167.2 million for the six months ended June 30, 2023, from RMB 155.7 million for the same period in 2022[56] - Research and development expenses increased by 24.1% to RMB 58.1 million for the six months ended June 30, 2023, compared to RMB 46.8 million for the same period in 2022[81] - Sales and marketing expenses increased by 29.8% to RMB 21.4 million for the six months ended June 30, 2023, compared to RMB 16.5 million for the same period in 2022[106] Cash Flow and Liquidity - Cash and cash equivalents at the end of the period were RMB 1,261.3 million, down from RMB 1,843.1 million as of June 30, 2022[94] - The net cash inflow from investing activities for the six months ended June 30, 2023, was RMB 47.7 million, a significant improvement from a net cash outflow of RMB 219.5 million for the same period in 2022[96] - Cash inflow from operating activities decreased by RMB 1,040.1 million to RMB 578.6 million for the six months ended June 30, 2023, compared to RMB 1,618.7 million for the same period in 2022[122] Acquisitions and Market Expansion - The company agreed to acquire Banco Português de Gestão, S.A. to enter the Portuguese and European markets[37] - The company launched a localized consumer finance brand "CreFIT" in Hong Kong in the first half of 2023[37] Asset and Liability Management - The company's total assets amounted to RMB 10,128,082 thousand, a slight increase from RMB 10,103,436 thousand as of December 31, 2022[153] - Total liabilities decreased to RMB 6,043,927 thousand from RMB 6,277,695 thousand, representing a reduction of about 3.7%[153] - The company's equity increased to RMB 4,084,155 thousand from RMB 3,825,741 thousand, marking an increase of approximately 6.8%[153] Other Financial Metrics - The first payment overdue rate was stabilized at 0.64% for 2023, with a three-month overdue rate of 2.26% as of Q2 2023[41] - The fair value of customer loans decreased by 10.8% to RMB 4,668.0 million as of June 30, 2023, compared to RMB 5,230.5 million as of December 31, 2022[114] - The total amount of overdue loans was RMB 59,957 thousand as of June 30, 2023, down from RMB 76,646 thousand at the end of 2022, showing a reduction of about 21.8%[178]

Financial Performance - The company reported a net profit of RMB 532.5 million and an adjusted net profit of RMB 537.4 million, representing a decrease of 54.8% and 55.7% compared to RMB 1,179.3 million and RMB 1,212.6 million in 2021 respectively[21]. - Total revenue for 2022 was RMB 3,119.3 million, down 9.8% from RMB 3,458.2 million in 2021[25]. - Interest income decreased by 2.5% to RMB 1,922.1 million, while interest expenses fell by 10.6% to RMB 529.1 million[25]. - The company experienced a significant increase in loan facilitation service fees, which rose by 1.6% to RMB 1,564.4 million[25]. - Operating profit for the year ended December 31, 2022, decreased by 54.1% to RMB 695.1 million from RMB 1,513.6 million for the year ended December 31, 2021[99]. - The total revenue for the year ended December 31, 2022, decreased by 9.8% to RMB 3,119.3 million from RMB 3,458.2 million for the year ended December 31, 2021[92]. - The net cash inflow from operating activities for the year was RMB 3,042.9 million, a significant increase compared to a net cash outflow of RMB 1,017.9 million in the previous year[134]. - The total revenue for the year was RMB 5,230,471 thousand, down from RMB 7,322,034 thousand in the previous year, reflecting a decline in overall business activity[127]. Loan Performance - The company achieved a historical high in loan realization volume for 2022, with a total loan volume of RMB 316.7 billion, accounting for 60.7% of total loan realizations[19]. - The company transitioned to a pure loan matching model, resulting in a loan volume of RMB 76.0 billion in 2022, a 440.1% increase from RMB 14.1 billion in 2021, representing 14.6% of total loan realizations[19]. - The company reported a fair value loss on customer loans of RMB 571.9 million in 2022, up from RMB 378.9 million in 2021[20]. - Credit impairment losses increased to RMB 129.5 million in 2022 from RMB 45.7 million in 2021, primarily due to the increase in loan volume under the credit enhancement and pure loan matching models[20]. - The company focused on high-quality borrowers, with repeat customers contributing 84.0% of the loan volume, while new customers contributed the remaining 16.0%[17]. - The total loan volume reached RMB 52.19 billion, a significant increase of 28.2% compared to RMB 40.71 billion in 2021[41]. - As of December 31, 2022, the outstanding loan balance exceeded RMB 25.07 billion, up 60.3% from RMB 15.64 billion at the end of 2021[41]. - The first payment overdue rate was approximately 0.43% in Q4 2022, indicating a low level within the industry[42]. - The one to three months overdue rate and the three months or more overdue rate at the end of 2022 were 3.53% and 1.77%, respectively[42]. Strategic Initiatives - The company is actively expanding into overseas consumer lending markets, particularly in Hong Kong, Southeast Asia, and Europe, and is applying for a lending license in Hong Kong[13]. - The company upgraded its Real-Time Acquisition (RTA) model to enhance the identification and marketing of target customers, particularly high-quality customer segments from various channels[12]. - The company aims to continuously improve its ability to provide customized credit products and services to target customers, focusing on a seamless customer experience[12]. - The company plans to expand into other markets, including Southeast Asia and Europe, focusing on consumer finance and investment opportunities[49]. - A strategic partnership was established with Lianlian International to develop cross-border supply chain finance, supported by the acquisition of a licensed factoring company[44]. - The company aims to seek investment or cooperation opportunities in Hong Kong, Southeast Asia, and Europe to expand and diversify its business[90]. Technology and Innovation - The company is committed to leveraging AI-driven technology and proprietary credit risk models to enhance operational efficiency and manage asset quality[33]. - The company plans to enhance its technology capabilities, including continuous research and development in artificial intelligence to improve risk management[91]. - The company is focused on improving user experience through optimized products and services, which has led to a substantial increase in new borrowers in the second half of 2022[27]. Governance and Management - The company has a strong management team with extensive experience in private equity and financial technology sectors[172]. - The company has adopted the corporate governance code as per the listing rules and has complied with applicable provisions[179]. - The board meets at least four times a year to review the group's operational, financial, and business performance, including interim and annual financial results[182]. - The company has a diverse board with independent non-executive directors providing independent judgment and opinions[187]. - The company has a risk management expert as the Chief Risk Officer with over ten years of experience in consumer lending risk management[199]. - The Chief Technology Officer has prior experience as Vice President of Technology at another financial services company[200].

Financial Performance - Total revenue for the year ended December 31, 2022, decreased by 9.8% to RMB 3,119.3 million from RMB 3,458.2 million in 2021[7]. - Interest income for the year was RMB 1,922.1 million, down 2.5% from RMB 1,971.8 million in the previous year[7]. - Net profit for the year fell by 54.8% to RMB 532.5 million compared to RMB 1,179.3 million in 2021[7]. - The adjusted net profit under non-IFRS was RMB 537.4 million, a decrease of 55.7% from RMB 1,212.6 million in the previous year[7]. - Operating profit decreased by 54.1% to RMB 695.1 million from RMB 1,513.6 million for the year ended December 31, 2021, attributed to a strategic shift in the loan portfolio[41]. - The company reported a profit attributable to owners of the company of RMB 532,466 thousand for 2022, down 54.9% from RMB 1,179,275 thousand in 2021[133]. - Basic earnings per share for the year were RMB 1.09, down from RMB 2.42 in the previous year, reflecting a decrease of approximately 55.0%[118]. User and Customer Metrics - The number of registered users increased to 126.8 million by the end of the year, contributing to 84.0% of the loan volume from repeat customers[5]. - The company reported a significant increase in loan facilitation service fees, which rose by 1.6% to RMB 1,564.4 million[7]. - Total revenue from loan facilitation service fees for 2022 was RMB 1,564,359 thousand, an increase of 1.6% from RMB 1,539,952 thousand in 2021[129]. Business Strategy and Development - The company successfully adjusted its business strategy to overcome challenges posed by COVID-19 measures, enhancing operational resilience[4]. - The company plans to continue optimizing and broadening its credit solutions to improve customer service and brand loyalty[18]. - The company aims to seek investment or partnership opportunities in complementary industries in regions such as Hong Kong, Southeast Asia, and Europe to expand and diversify its business[28]. - The company will continue to review potential business prospects and make appropriate investments when opportunities arise[28]. Financial Position and Assets - The total assets as of December 31, 2022, were RMB 10,103.4 million, down from RMB 11,276.9 million in 2021, representing a decline of approximately 10.4%[120]. - The total liabilities decreased to RMB 6,277.7 million from RMB 7,883.2 million, a reduction of about 20.3%[120]. - The total amount of customer loans measured at fair value decreased by 28.6% to RMB 5,230.5 million as of December 31, 2022, from RMB 7,322.0 million as of December 31, 2021[50]. - The year-end balance of guaranteed receivables increased to RMB 787,396 thousand from RMB 325,331 thousand in the previous year, indicating growth in new business[53]. Cash Flow and Financing - Cash inflow from operating activities for the year ended December 31, 2022, was RMB 3,042,945 thousand, compared to an outflow of RMB 1,017,949 thousand for the previous year[58]. - The net cash outflow from financing activities for the year was RMB 3,177.3 million, compared to a net cash inflow of RMB 1,545.6 million for the year ended December 31, 2021[112]. - The company’s cash and cash equivalents as of December 31, 2022, were RMB 1,592,365,000, compared to RMB 1,907,940,000 as of December 31, 2021[190]. Expenses and Provisions - Research and development expenses increased by 20.8% to RMB 97.7 million from RMB 80.9 million for the year ended December 31, 2021, due to increased employee benefits related to enhanced technical capabilities[41]. - The expected credit loss provision for the year was RMB (80,580) thousand, compared to RMB (4,814) thousand in 2021, indicating a significant increase in provisions[141]. - The company’s total expenses for loan realization and service fees increased to RMB (1,123,097) thousand in 2022 from RMB (1,006,387) thousand in 2021, representing a rise of 11.6%[130]. Regulatory and Compliance - The company aims to ensure compliance with regulatory standards for sustainable development[19]. - The company has consolidated several structured entities primarily related to trust plans, assessing the ability to act as an agent or principal[200]. Shareholder Returns - The proposed final dividend for the year is HKD 0.10 per share, pending shareholder approval, compared to HKD 0.15 per share for the previous year[182]. - The company plans to distribute the proposed final dividend on or around July 12, 2023, if approved by shareholders[182].

Loan Performance - The loan realization amount reached RMB 24.64 billion, marking a historical high for the company, with a growth of 9.4% compared to the same period in 2021 and 35.5% compared to the previous six months[9]. - The outstanding loan balance exceeded RMB 20.49 billion, representing a 31.1% increase from RMB 15.64 billion as of December 31, 2021[9]. - The company achieved a loan total of RMB 14.35 billion through credit enhancement loan matching, accounting for 58.2% of total loan realizations[11]. - The repeat loan volume accounted for 89.2% of the loan realization amount, demonstrating improved customer loyalty and retention[11]. - The total loan volume achieved during the period was RMB 24,641.7 million, with a significant increase in trust loans, which accounted for 27.4% of the total[31]. - The average loan size was approximately RMB 11,581, with an average loan term of about 10.2 months[29]. Asset Quality - The first payment overdue rate reached a record low of 0.23% in Q2 2022, down from 0.43% in Q4 2021, indicating improved asset quality[10]. - The overdue rates for one to three months and over three months improved to 2.07% and 2.06%, respectively, at the end of the period[10]. - The overdue rate for first payments reached a new low of approximately 0.25%, while the one to three months overdue rate decreased to 2.07% from 4.01% in Q4 2021[35]. - The company has enhanced its credit risk model by incorporating new multidimensional data and advanced algorithms, improving customer assessment efficiency[10]. - The company’s agile response to the COVID-19 pandemic allowed for rapid optimization of risk policies, mitigating impacts on asset quality[28]. Financial Performance - Total revenue for the period was RMB 1,582.5 million, a decrease of 15.8% compared to RMB 1,880.0 million in the same period last year[21]. - Net profit for the period was RMB 328.0 million, down 57.8% from RMB 777.6 million in the same period last year[21]. - The company recorded a fair value loss on customer loans of RMB 303.6 million, compared to RMB 129.2 million in the same period last year[21]. - Operating expenses increased by 11.4% to RMB 778.6 million, compared to RMB 698.8 million in the same period last year[15]. - The company’s interest income rose by 36.3% to RMB 1,124.7 million, compared to RMB 825.0 million in the same period last year[21]. - Operating profit for the period was RMB 430.4 million, a decrease of 57.3% compared to RMB 1,008.8 million in the same period last year[69]. - Non-IFRS adjusted operating profit was RMB 433.8 million, a decrease of 58.1% from RMB 1,036.2 million in the same period last year[71]. - The fair value of customer loans measured at fair value through profit or loss decreased by 11.9% to RMB 6,451.4 million as of June 30, 2022, from RMB 7,322.0 million as of December 31, 2021[76]. Customer Engagement and Strategy - The company actively adjusted its credit model to attract and retain high-quality customers, ensuring operational efficiency and customer experience[8]. - The company aims to enhance operational efficiency and improve customer engagement through optimized online applications and application processes[24]. - The contribution of repeat customers accounted for 89.2% of the loan volume during the period[24]. - The company expanded its customer acquisition channels by collaborating with partners like OPPO, Xiaomi, and China Telecom, focusing on high-quality customer identification[27]. - The company’s strategy has shifted towards higher quality borrowers, reflecting a proactive adjustment in risk management[24]. Regulatory and Market Environment - The company anticipates ongoing challenges in the second half of 2022 due to the evolving regulatory environment and macroeconomic risks[17]. - The company emphasizes compliance with laws and regulations as a priority for sustainable business development[43]. Shareholder and Corporate Governance - The company proposed an interim dividend of HKD 0.10 per share, totaling approximately HKD 49.0 million, subject to shareholder approval[103]. - The audit committee reviewed the interim report with the senior management of the company[162]. - The company’s interim financial information was prepared in accordance with International Accounting Standard 34[166]. - No significant issues were found that would indicate the interim financial information was not prepared in accordance with the relevant standards[167]. Cash Flow and Debt Management - The company's net cash inflow from operating activities for the six months ended June 30, 2022, was RMB 1,618.7 million, while cash outflow was RMB 1,666.8 million, primarily due to a decrease in loan realizations through the trust loan model by RMB 920.0 million[94]. - The net cash outflow from financing activities was RMB 1,469.4 million, compared to a net cash inflow of RMB 1,849.1 million in the previous period, with cash outflow from borrowings and trust plans amounting to RMB 1,133.9 million[95]. - The company repurchased $29,032,000 of its 2022 senior notes, reducing the outstanding principal amount to $54,440,000, which is 64.0% of the original principal[158]. - The company’s total debt to equity ratio was approximately 1.8 times as of June 30, 2022, down from 2.2 times on December 31, 2021[89]. Employee Incentives and Share Options - The company has adopted three pre-IPO share option plans to incentivize key employees and directors[118]. - The pre-IPO share option plans aim to enhance operational efficiency and align the interests of employees with those of shareholders[118]. - The company has implemented the first and second share incentive plans, allowing for a total of 74,280,087 shares to be granted as rewards[129]. - During the period, a total of 200,000 shares were granted under the first share incentive plan[129].

Financial Performance - VCREDIT Holdings achieved record profitability in 2021 despite challenges from COVID-19 and macroeconomic conditions[11]. - The net profit for the year ended December 31, 2021, was RMB 1.18 billion, a substantial improvement from a net loss of RMB 870 million in 2020[23]. - Total revenue increased by 34.4% to RMB 3.46 billion in 2021, up from RMB 2.57 billion in 2020, primarily due to a threefold increase in loan facilitation service fees[23]. - The company recorded a net profit of RMB 1,179.3 million for the year, compared to a net loss of RMB 869.6 million for the year ended December 31, 2020, representing a significant turnaround[81]. - The adjusted operating profit margin under non-IFRS reached 44.7%, compared to -38.0% in the previous year, showcasing a substantial improvement in profitability[88]. - The adjusted net profit margin under non-IFRS was 35.1%, compared to -30.9% in the previous year, indicating a strong recovery in profitability metrics[88]. Dividend and Shareholder Returns - The company declared its first cash dividend to shareholders, indicating strong liquidity and profitability[11]. - The company proposed a total annual dividend of HKD 0.35 per share, reflecting confidence in profitability and liquidity[20]. Loan and Revenue Growth - In 2021, the total loan volume reached RMB 40.71 billion, a significant increase of 32.3% compared to RMB 30.77 billion in 2020[20]. - The total loan balance granted to customers as of December 31, 2021, was RMB 15,637.0 million, an increase from RMB 14,065.4 million in 2020, representing a growth of 11.2%[42]. - Loan facilitation service fees rose by 115.9% to RMB 1,540.0 million, up from RMB 713.3 million in the previous year[32]. - The total amount of customer loans measured at fair value increased by 81.8% to RMB 7,322.0 million as of December 31, 2021, driven by growth in trust loan and direct loan models[93]. Risk Management and Compliance - VCREDIT's risk management is supported by a comprehensive database and advanced risk management engine, allowing for tailored credit products[11]. - The company is committed to strict compliance with regulatory requirements and has adjusted its risk management procedures in response to changing regulations[16]. - The company is focusing on improving risk management capabilities through evolving technology and artificial intelligence[57]. - The company will ensure operations within applicable regulatory frameworks to achieve business sustainability[57]. Customer Acquisition and Market Strategy - VCREDIT's customer acquisition strategy utilizes big data modeling and advanced technology to optimize customer identification and enhance brand awareness[11]. - The company aims to improve asset quality by shifting its target customer base towards higher quality clients[11]. - The company aims to optimize its business model and strategies to provide better loan facilitation and post-loan management services, contributing to economic recovery and growth[25]. - The company plans to optimize business strategies and enhance technology to meet the financial needs of high-quality customers and maintain competitiveness in the changing macro environment[54]. Corporate Governance and Leadership - The board includes key executives such as Mr. Ma Ting-hung as Executive Director and Chairman, and Mr. Liao Shih-hung as Executive Director and CEO[123]. - The company has a strong board with members experienced in private equity and financial services, including Mr. Chen Derek, who joined in December 2021[134]. - The company emphasizes strategic growth and operational excellence through its board members' extensive experience in various sectors[132]. - The board is committed to adopting good corporate governance practices and has complied with the corporate governance code as per the Hong Kong Stock Exchange[145]. Operational Efficiency and Technology - The company is focused on enhancing operational efficiency through AI-driven big data acquisition models to improve customer experience and retention[36]. - The company is committed to ongoing development in financial technology and private equity investments[134]. - The internal audit department, supervised by the audit committee, conducts independent audits to assess the effectiveness of risk management and internal controls[194]. Financial Position and Cash Flow - The cash and cash equivalents at the end of the year increased to RMB 1,908.1 million from RMB 1,501.8 million in 2020[114]. - The net cash inflow from financing activities was RMB 1,545.6 million in 2021, compared to a net cash outflow of RMB 5,913.4 million in 2020[115]. - The expected credit loss provision increased to RMB 53.2 million from RMB 47.7 million, reflecting a cautious approach to credit risk management[99].

Financial Performance - The company achieved a net profit of RMB 777.6 million for the six months ended June 30, 2021, a significant turnaround from a net loss of RMB 1,081.2 million in the same period last year, representing a 267.4% increase[26]. - Total revenue increased by 56.2% to RMB 1,880.0 million, compared to RMB 1,203.8 million in the same period last year[27]. - Operating profit for the period was RMB 1,008,756 thousand, compared to an operating loss of RMB 1,339,063 thousand in the same period last year[178]. - The company reported a profit attributable to owners of the company of RMB 777,633 thousand, a turnaround from a loss of RMB 1,081,240 thousand in the prior year[180]. - The company experienced a total comprehensive income of RMB 775,874 thousand for the period, compared to a loss of RMB 1,076,876 thousand in the prior year[180]. - The non-IFRS adjusted operating profit was RMB 1,036.2 million, a substantial increase of 220.9% from RMB 322.9 million for the six months ended December 31, 2020, and a turnaround from a loss of RMB 1,299.9 million for the six months ended June 30, 2020[80]. - The non-IFRS adjusted net profit was RMB 805.0 million, compared to a net loss of RMB 1,042.0 million for the six months ended June 30, 2020[81]. Loan and Financing Activities - Total loan realizations reached RMB 22.5 billion, a substantial increase of 69.2% compared to RMB 13.3 billion for the same period in 2020[23]. - Loans facilitated through partnerships with licensed financial institutions amounted to RMB 14.4 billion, a 75.8% increase from RMB 8.2 billion in the same period last year[25]. - The total loan volume achieved during the period was RMB 22,525.7 million, with a year-on-year increase of 29.1% compared to RMB 17,459.6 million in the same period last year[44]. - The average loan size increased by 17.0% to RMB 13,091 from RMB 11,192 in the previous year[23]. - The company has established a stable financing structure supported by 64 external licensed financing partners, enhancing its capital flexibility[25]. - The company recorded a guarantee income of RMB 293.9 million, compared to a guarantee loss of RMB 421.5 million in the previous year[26]. Risk Management and Credit Quality - The company successfully transformed its credit policy and risk models, focusing on higher-quality borrowers, resulting in a one to three-month overdue rate of 2.06% and a three-month overdue rate of 1.40%[23]. - The fair value loss on loans to customers decreased by 92.8% to RMB 129.2 million from RMB 1,800.1 million in the same period last year[26]. - The company has improved overdue rates and asset quality indicators, significantly better than pre-COVID-19 levels[37]. - The first payment overdue rate remained stable at approximately 0.4%, while the one to three months overdue rate decreased from 2.50% in Q4 2020 to 2.06% in Q2 2021[48]. - The three months overdue rate also reached a historical low, dropping from 2.86% in Q4 2020 to 1.40% in Q2 2021[48]. - The company implemented a new generation of multi-source scoring cards to enhance risk management capabilities[48]. Operational Efficiency and Strategy - The company’s proactive adjustments to its business strategy and credit models have allowed it to effectively respond to challenges posed by the COVID-19 pandemic[21]. - The company is focusing on optimizing its model and strategies to enhance loan facilitation and post-loan management services[29]. - The company plans to explore more business opportunities with existing institutional partners, including providing comprehensive fintech solutions[25]. - The company aims to enhance risk-centered technological capabilities through continuous research and development[56]. - The company is continuously optimizing its customer lifecycle valuation model to improve marketing decisions[48]. Shareholder and Corporate Governance - The company proposed an interim dividend of HKD 0.10 per share and a special dividend of HKD 0.10 per share, pending shareholder approval[27]. - The company has complied with the corporate governance code principles as per the Hong Kong Stock Exchange listing rules[120]. - The board currently has two independent non-executive directors, which is below the required minimum of three[123]. - The company is in the process of identifying suitable candidates to fill the vacancy left by the resignation of an independent non-executive director[124]. Employee and Share Incentive Plans - The group has implemented multiple share incentive plans to provide equity-based incentives and rewards for eligible personnel[127]. - The company adopted the first share incentive plan on January 11, 2019, allowing for a maximum of 24,974,369 shares to be granted[142]. - The company aims to retain and incentivize eligible participants through the Post-IPO Stock Option Plan[140]. - The company has established a specific plan for eligible employees participating in the Hong Kong Mandatory Provident Fund scheme, with contributions based on a percentage of salaries[119]. Cash Flow and Financial Position - The net cash outflow from operating activities for the six months ended June 30, 2021, was RMB 1,666.8 million, compared to a net cash inflow of RMB 3,818.1 million for the same period in 2020[105]. - The cash inflow from financing activities for the six months ended June 30, 2021, was RMB 1,849.1 million, compared to a cash outflow of RMB 4,170.3 million for the same period in 2020[108]. - Total assets as of June 30, 2021, amounted to RMB 11,324,715 thousand, up from RMB 8,337,194 thousand at the end of 2020, reflecting a growth of 35.0%[182]. - Total liabilities increased to RMB 8,237,148 thousand, compared to RMB 6,050,850 thousand at the end of 2020, marking a rise of 36.2%[182]. - Cash and cash equivalents stood at RMB 1,650,715 thousand, an increase from RMB 1,501,830 thousand at the end of 2020[182].

Financial Performance - In 2020, the company faced significant challenges due to the Covid-19 pandemic, leading to a decrease in credit demand and an increase in overdue rates[23]. - By the end of 2020, the company's financial performance in the second half was significantly better than the first half, and even surpassed the second half of 2019[25]. - The company reported a net loss of RMB 8.696 billion for the year ended December 31, 2020, compared to a net profit of RMB 648 million for the year ended December 31, 2019[34]. - In the second half of 2020, the company achieved a net profit of RMB 2.117 billion, marking a recovery from a net loss of RMB 10.812 billion in the first half of the year[35]. - Total revenue decreased by 33.4% to RMB 2.573 billion for the year ended December 31, 2020, due to the impact of the Covid-19 pandemic[36]. - Total revenue for the year ended December 31, 2020, was RMB 2,573.2 million, a decrease of 33.4% compared to RMB 3,864.4 million in 2019[42]. - The company reported a decrease in cash inflow from trust loan models, amounting to RMB 4,893.4 million for the year[124]. - The company recorded an operating loss of RMB 1,051.7 million compared to an operating profit of RMB 154.4 million for the year ended December 31, 2019, mainly due to the adverse impact of Covid-19 in Q1 2020[91]. Loan Realization and Overdue Rates - In 2020, the total loan realization amount reached RMB 30.77 billion, remaining stable compared to 2019[32]. - The overdue rates improved significantly, with the one to three months overdue rate at 2.5% and the three months and above overdue rate at 2.9% by the end of 2020[31]. - The first payment overdue rate improved to 0.4% by Q4 2020, down from 2.0% at the end of Q1 2020, marking the best rate in the company's history[58]. - The one to three months overdue rate decreased from 7.4% in Q2 2020 to 2.5% in Q4 2020[58]. - The three months overdue rate also improved from 7.1% in Q2 2020 to 2.9% in Q4 2020[58]. - Total loan realizations for 2020 amounted to RMB 30,773.0 million, a decrease of 9.3% from RMB 33,746.4 million in 2019[51]. Strategic Partnerships and Growth - The company became the only non-bank online platform in China's consumer finance industry with a customer base that includes near-prime and prime customers, following the exit of nearly all P2P lending platforms[27]. - In 2020, the company partnered with 16 new funding partners, increasing the total number of institutional funding partners to 61[27]. - The company added 16 new institutional funding partners during the year, which is crucial for business expansion and sustainability[32]. - The company plans to enhance its technological capabilities and closely monitor market trends to seize opportunities in the evolving market[39]. - The company intends to deepen mutually beneficial relationships with funding and business partners to seek stable growth and create value for shareholders[68]. Technology and Risk Management - The company implemented new policies and measures to manage loan realizations more proactively, enhancing risk models and credit scoring algorithms to improve asset quality[24]. - The company implemented a multi-source scoring card to improve the efficiency of assessing customer credit status and default risk[47]. - The company aims to leverage technology advancements to enhance its business development and risk management capabilities[47]. - The company plans to continue investing in R&D to enhance technology and risk management capabilities, optimize products, and improve customer service experience[68]. Corporate Governance - The management team emphasized the importance of maintaining strong corporate governance practices throughout the year[161]. - The board confirmed compliance with the corporate governance code, ensuring adherence to the listing rules[162]. - The board of directors consists of two executive directors, including the CEO and COO, and several non-executive and independent non-executive directors[164]. - Independent non-executive directors constitute more than half of the board, enhancing its independence and decision-making capabilities[175]. - The company has appointed a new independent non-executive director, ensuring compliance with listing rules regarding board composition[178]. - The audit committee is responsible for reviewing financial reporting procedures, internal controls, and risk management systems[187]. Operational Efficiency - The company focused on quality-driven growth and technology-driven cost reduction, implementing staff restructuring and streamlining during the pandemic[27]. - Operating expenses (excluding share-based compensation) increased by 8.0% to RMB 1.1188 billion, driven by enhanced loan collection efforts[37]. - Sales and marketing expenses decreased by 28.2% to RMB 23.1 million from RMB 32.2 million for the year ended December 31, 2019, attributed to reduced brand promotion costs and improved operational efficiency[86]. - General and administrative expenses decreased by 44.5% to RMB 280.3 million from RMB 505.4 million for the year ended December 31, 2019, primarily due to reduced employee-related costs[87]. Future Outlook - The company provided guidance for the next fiscal year, projecting revenue growth of A% and an expected user base of B million[149]. - New product launches are anticipated, including the introduction of C, which is expected to enhance market competitiveness[149]. - Market expansion plans include entering E markets, with an expected investment of F million to support this initiative[149]. - The company is considering strategic acquisitions to bolster its market position, targeting G companies in the sector[149].

Financial Performance - The company reported a net loss of RMB 1,081.2 million for the period, compared to a net profit of RMB 6.2 million in the same period of 2019, reflecting a significant impact from COVID-19[13]. - Total revenue decreased by 35.3% to RMB 1,203.8 million, down from RMB 1,860.2 million in 2019[18]. - Operating loss for the period was RMB 1,339.1 million, compared to an operating profit of RMB 57.4 million for the same period in 2019, largely due to increased loan repayment delinquencies[62]. - The net loss attributable to the owners of the company for the six months ended June 30, 2020, was RMB 1,081,240 thousand, compared to a profit of RMB 6,174 thousand in the same period of 2019[166]. - The company’s total equity attributable to owners was RMB 2,059,936 thousand as of June 30, 2020, down from RMB 2,928,472 thousand as of June 30, 2019, reflecting a decline of approximately 30%[191]. Loan Performance - The online credit product loan origination volume for the first half of 2020 was RMB 13.31 billion, a decrease of 7.6% compared to the same period last year[9]. - As of June 30, 2020, the outstanding loan balance for online credit products was RMB 14.72 billion, down 15.8% from RMB 17.48 billion on December 31, 2019[9]. - The average loan size during the period increased by 43.6% to RMB 11,192 from RMB 7,796 in the same period last year[9]. - Total loan realizations for the first half of 2020 amounted to RMB 13,313.4 million, a decrease of 7.6% compared to RMB 14,402.9 million in the same period of 2019[25]. - Trust loans reached RMB 5,049.4 million, representing a 37.9% increase from RMB 5,056.9 million in the previous year[25]. Asset Quality - The first payment overdue rate improved significantly from 2.7% in January 2020 to 0.8% by June 2020, indicating better asset quality for new loans[10]. - The overdue rate for first payments dropped to 0.8% in Q2 2020 from 2.0% in Q1 2020, with an estimated rate of approximately 1.0% for the second half of 2020[28]. - The asset quality ratio has improved and is now lower than pre-COVID-19 levels, attributed to targeted risk control measures[21]. - The company incurred credit impairment losses of RMB 165,008 thousand for the six months ended June 30, 2020, compared to RMB 124,161 thousand in the same period of 2019, marking an increase of about 33%[164]. Operational Adjustments - The company implemented more prudent lending policies, focusing on high-quality borrowers to stabilize asset quality during the COVID-19 pandemic[9]. - The company adjusted its funding structure to secure more favorable terms for borrowers, benefiting from reduced funding costs due to the central bank's monetary easing[12]. - The company plans to enhance risk management capabilities and compliance in response to the changing regulatory environment[40]. - The company aims to implement cost-saving measures to address the weakening revenue environment[40]. Cash Flow and Liquidity - The company maintained a healthy cash flow with cash and cash equivalents amounting to RMB 1.81 billion as of June 30, 2020[13]. - Net cash inflow from operating activities was RMB 3,818,076 thousand for the six months ended June 30, 2020, significantly up from RMB 1,791,972 thousand for the same period in 2019[87]. - The company experienced a net decrease in cash and cash equivalents of RMB 355,349 thousand for the first half of 2020, compared to an increase of RMB 839,724 thousand in the same period of 2019[87]. - The net cash outflow from financing activities for the period was RMB 4,170.3 million, significantly higher than RMB 862.5 million for the six months ended June 30, 2019[88]. Employee and Organizational Changes - The company initiated the "Employee Vitality Project" to provide more career development opportunities and streamline its organizational structure[12]. - The group employed a total of 605 employees as of June 30, 2020[100]. - The company has established several share incentive plans to provide equity-based incentives and rewards for eligible individuals[100]. Shareholder and Capital Management - The company has a strategy to enhance shareholder value through performance incentives linked to share ownership[113]. - The company repurchased a total of 709,400 shares at a total cost of HKD 2,871,832, aimed at enhancing the net asset value per share for shareholders[155]. - Major shareholders include ASM Connaught House Fund II LP and its affiliates, holding 12.02% of the total issued shares[133]. - The company aims to benefit all shareholders through strategic share repurchase initiatives[155]. Future Outlook - The company anticipates positive contributions to its financial performance in the second half of 2020 due to the recovery of asset quality and loan facilitation volume[14]. - The company believes that the demand for consumer finance products will continue to grow in the long term, supported by effective government policies[16].

Financial Performance - The company reported a net loss of RMB 1,081.2 million for the period, compared to a net profit of RMB 6.2 million in the same period of 2019, reflecting a significant impact from COVID-19[13]. - Total revenue decreased by 35.3% to RMB 1,203.8 million, down from RMB 1,860.2 million in 2019[18]. - Operating loss for the period was RMB 1,339.1 million, compared to an operating profit of RMB 57.4 million for the same period in 2019, largely due to increased loan repayment delinquencies[62]. - The company reported a net loss attributable to owners of the company of RMB 1,081,240 thousand, compared to a profit of RMB 6,174 thousand in the same period last year[164]. - The company incurred credit impairment losses of RMB 165,008 thousand, compared to RMB 124,161 thousand in the previous year, reflecting a 33% increase[164]. - The company reported a total comprehensive loss of RMB (1,076,876) thousand for the period, compared to a total comprehensive income of RMB 5,603 thousand in the previous year[166]. Loan and Credit Metrics - The online credit product loan volume for the first half of 2020 was RMB 13.31 billion, a decrease of 7.6% compared to the same period last year[9]. - As of June 30, 2020, the outstanding loan balance for online credit products was RMB 14.72 billion, down 15.8% from RMB 17.48 billion on December 31, 2019[9]. - The average loan size during the period increased by 43.6% to RMB 11,192 from RMB 7,796 in the same period last year[9]. - The overdue rate for first payments dropped to 0.8% in Q2 2020 from 2.0% in Q1 2020, with an estimated rate of approximately 1.0% for the second half of 2020[28]. - Total loan realizations for the first half of 2020 amounted to RMB 13,313.4 million, a decrease of 7.6% compared to RMB 14,402.9 million in the same period of 2019[25]. - Trust loans reached RMB 5,049.4 million, representing a 37.9% increase from RMB 5,056.9 million in the previous year[25]. Revenue and Income - Interest income rose by 13.7% to RMB 1,310.6 million, while interest expenses increased by 12.8% to RMB 446.5 million[18]. - Net interest income for the first half of 2020 was RMB 864.1 million, an increase from RMB 756.7 million in the same period of 2019[43]. - Total interest income for the six months ended June 30, 2020, was RMB 1,310.6 million, an increase of 13.7% compared to RMB 1,152.6 million for the same period in 2019[47]. - Loan facilitation service fees decreased by 58.4% to RMB 238.2 million from RMB 572.9 million in the previous year, primarily due to a conservative lending strategy adopted in response to the COVID-19 pandemic[48]. - Other income for the six months ended June 30, 2020, was RMB 101.5 million, a significant decrease of 80.9% from RMB 530.6 million in the same period of 2019[52]. Operational Adjustments - The company implemented more prudent lending principles during the pandemic, focusing on high-quality borrowers[9]. - The company adjusted its risk underwriting policies and post-loan services to maintain business stability during the pandemic[8]. - The company has implemented targeted risk control measures to manage and reduce credit risk exposure, leading to an improvement in asset quality ratios[21]. - The company anticipates positive contributions to its financial performance in the second half of 2020 due to the recovery of asset quality and loan realization volume[14]. - The company plans to enhance risk management capabilities through technology-driven strategies and improve compliance in a changing regulatory environment[40]. Cash Flow and Liquidity - The company maintained a healthy cash flow with cash and cash equivalents amounting to RMB 1.81 billion as of June 30, 2020[13]. - Net cash inflow from operating activities increased to RMB 3,818,076 thousand for the six months ended June 30, 2020, from RMB 1,791,972 thousand for the same period in 2019[87]. - The company’s cash and cash equivalents decreased by RMB 355,349 thousand during the period, ending at RMB 1,814,054 thousand as of June 30, 2020[87]. - The net cash outflow from financing activities for the period was RMB 4,170.3 million, significantly higher than RMB 862.5 million for the six months ended June 30, 2019[88]. Employee and Management Initiatives - The company launched the "Employee Vitality Project" to provide more career development opportunities for employees[12]. - The group had a total of 605 employees as of June 30, 2020, focusing on attracting and retaining talented staff[100]. - The company has established several share incentive plans to provide equity-based incentives and rewards for eligible individuals[100]. Shareholder and Ownership Structure - The company is controlled by various entities, with significant ownership percentages including 37.99% by Ma Ting-hsiung and 12.02% by Chen Jian[135][152]. - The company has multiple controlled entities, including Skyworld-Best Limited and Wealthy Surplus Limited, each with substantial shareholdings[135]. - The company’s management has reviewed the interim report with the audit committee[158]. Future Outlook - The company believes that the demand for consumer finance products will continue to grow in the long term, supported by effective government policies[16]. - The company aims to provide tailored consumer finance products to high-quality borrowers underserved by traditional financial institutions, indicating a focus on market expansion and innovation in financial services[196].