Financial Data and Key Metrics Changes - In Q2 2021, the life insurance industry experienced a total gross written premiums decline of 16.6%, while Fanhua reported a total life insurance GWP of RMB2.5 billion, reflecting a year-over-year growth of 4.9% [8] - For the first half of 2021, Fanhua's life insurance premiums reached RMB5.5 billion, up 16.9% year-over-year, significantly outperforming the industry growth of only 0.4% [8] Business Line Data and Key Metrics Changes - The product mix by 20-year APE showed whole life insurance at 49%, critical illness at 43%, and annuity at 6%, compared to 19%, 69%, and 9% respectively in the same period last year [22] - The critical illness product's share of total mix dropped significantly due to a transition in definitions and market saturation, indicating a shift towards savings products for future growth [22][23] Market Data and Key Metrics Changes - The health insurance market is becoming saturated, leading to expected slower growth, while demand for commercial pension insurance and long-term annuities is anticipated to grow due to an aging population [6][7] Company Strategy and Development Direction - The company is committed to a strategy of professionalization, digitalization, and open platform to capitalize on market changes and opportunities [7] - Fanhua plans to expand its Yuntong branches, aiming for 25 by the end of the year, primarily in first-tier cities [26] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by COVID-19 on consumer confidence but emphasized the long-term growth potential in China's life insurance market [5][6] - For Q3 2021, the company expects new business growth quarter-over-quarter and operating income to exceed RMB100 million for the second half of 2021 [11] Other Important Information - The quarterly dividend for Q2 2021 is set at $0.15 per ADS, payable on or around September 23, 2021 [11] Q&A Session Summary Question: Impact of double recording practice on offline insurance sales and trends in critical illness products - Management welcomed the new regulations, believing they will standardize operations and reduce policy cancellations, with long-term benefits outweighing short-term impacts [15] - The market for critical illness products is expected to be limited, with future growth coming from the demand of middle-class families for customized products [17] Question: Current product mix and targeted customer groups - The current product mix shows a significant drop in critical illness products, with a shift towards savings products expected to grow in the future [22][23] - The company targets urban middle-class families, focusing on major cities for its sales strategy [26]

Fanhua Inc. (NASDAQ:FANH) Q1 2021 Earnings Conference Call May 27, 2021 9:00 PM ET Company Participants Oasis Qiu - Manager of Investor Relations Chunlin Wang - Chairman & Chief Executive Officer Conference Call Participants Operator Thank you for standing by for Fanhua's First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. All lines have been placed on mute to prevent background noise. After the management's prepared remarks, there will be a question-and-an ...

PART I [Key Information](index=6&type=section&id=Item%203.%20Key%20Information) This section presents Fanhua Inc.'s selected historical financial data and significant risk factors from 2016 to 2020 [Selected Financial Data](index=6&type=section&id=A.%20Selected%20Financial%20Data) Fanhua provides five years of selected consolidated financial data (2016-2020) showing fluctuating revenues and net income, with a general downward trend in assets and equity Selected Consolidated Statements of Income Data (2018-2020, in millions RMB) | Indicator | 2018 | 2019 | 2020 | | :--- | :--- | :--- | :--- | | **Total net revenues** | 3,471.3 | 3,706.0 | 3,268.1 | | **Income from continuing operations** | 425.7 | 469.4 | 302.2 | | **Net income from continuing operations** | 617.1 | 192.6 | 276.2 | | **Net income attributable to the Company's shareholders** | 609.9 | 188.9 | 268.3 | | **Diluted Net income per share (RMB)** | 0.49 | 0.17 | 0.25 | | **Diluted Net income per ADS (RMB)** | 9.83 | 3.46 | 4.99 | Selected Consolidated Balance Sheet Data (2018-2020, in millions RMB) | Indicator | 2018 | 2019 | 2020 | | :--- | :--- | :--- | :--- | | **Total assets** | 3,866.6 | 3,440.8 | 3,081.0 | | **Total liabilities** | 1,119.9 | 1,396.4 | 1,126.3 | | **Total equity** | 2,746.7 | 2,044.5 | 1,954.7 | [Risk Factors](index=9&type=section&id=D.%20Risk%20Factors) Fanhua identifies various risks across business, corporate structure, China operations, and ADSs, including partner dependence, regulatory changes, COVID-19 impact, and potential delisting - The company has significant partner concentration risk, with its top four insurance partners (Huaxia, Aeon, Sinatay, and Evergrande) each accounting for **over 10%** of total net revenues in 2020[22](index=22&type=chunk)[75](index=75&type=chunk) - The business was materially impacted by the COVID-19 pandemic in 2020, which hindered sales agents' face-to-face interactions, slowed agent recruitment, and shifted consumer preference towards more affordable online medical insurance products[79](index=79&type=chunk)[81](index=81&type=chunk) - The company faces potential delisting from U.S. exchanges under the Holding Foreign Companies Accountable Act if the PCAOB is unable to inspect its auditor's work in China for three consecutive years[145](index=145&type=chunk) - Regulatory changes in China, such as new definitions for critical illnesses and stricter rules for online insurance, could increase compliance costs and adversely affect business operations and product sales[28](index=28&type=chunk)[37](index=37&type=chunk)[44](index=44&type=chunk) [Information on the Company](index=39&type=section&id=Item%204.%20Information%20on%20the%20Company) This section details Fanhua's history, business operations, organizational structure, and properties, highlighting its O2O model and regulatory environment [History and Development of the Company](index=39&type=section&id=A.%20History%20and%20Development%20of%20the%20Company) Fanhua, founded in 1999 and listed on NASDAQ in 2007, has grown organically and through acquisitions, investing in online platforms - The company was founded in 1999, listed on NASDAQ in 2007, and changed its name from CNinsure Inc. to Fanhua Inc. in 2016[166](index=166&type=chunk)[167](index=167&type=chunk) - Fanhua has made strategic investments in complementary businesses, holding an **18.5%** equity interest in CNFinance (NYSE: CNF) and a **4.5%** interest in Puyi Inc. (NASDAQ: PUYI)[172](index=172&type=chunk) [Business Overview](index=40&type=section&id=B.%20Business%20Overview) Fanhua operates as a leading independent insurance intermediary in China, using an O2O model to distribute life and health products through agents and online platforms, also providing claims adjusting services - Fanhua operates an integrated offline-to-online (O2O) model, leveraging technology platforms and an extensive offline network of **362,580 sales agents** and **763 sales outlets** as of December 31, 2020[176](index=176&type=chunk)[178](index=178&type=chunk) - The company's business is organized into two primary segments: the insurance agency segment, which accounted for **86.7%** of net revenues in 2020, and the claims adjusting segment, which accounted for **13.3%**[184](index=184&type=chunk)[185](index=185&type=chunk)[195](index=195&type=chunk) - Life and health insurance products are the main revenue driver, contributing **82.7%** of total net revenues in 2020[186](index=186&type=chunk) - The Chinese insurance industry is highly regulated by the China Banking and Insurance Regulatory Committee (CBIRC), which governs licensing, market conduct, product design, and foreign investment[216](index=216&type=chunk)[228](index=228&type=chunk) [Organizational Structure](index=62&type=section&id=C.%20Organizational%20Structure) Fanhua, a Cayman Islands holding company, conducts business in China through subsidiaries, having transitioned from VIEs to direct equity ownership for most operations by 2016 - The company has transitioned from a VIE structure to direct controlling equity ownership in its insurance intermediary and online operations by May 2016[287](index=287&type=chunk) - Fanhua controls **69.0%** of the voting interests in its claims adjusting entity, FHISLA, through act-in-concert agreements[289](index=289&type=chunk)[293](index=293&type=chunk) [Property, Plants and Equipment](index=64&type=section&id=D.%20Property%2C%20Plants%20and%20Equipment) Fanhua primarily operates from leased properties, with total rental expenses of **RMB 106.6 million (US$16.3 million)** in 2020 for approximately 183,192 square meters of office space - As of December 31, 2020, the company leased approximately **183,192 square meters** of office space, with total rental expenses of **RMB 106.6 million** for the year[295](index=295&type=chunk) [Operating and Financial Review and Prospects](index=64&type=section&id=Item%205.%20Operating%20and%20Financial%20Review%20and%20Prospects) This section analyzes Fanhua's financial performance and condition, detailing operating results, liquidity, cash flows, and contractual obligations, highlighting the COVID-19 impact [Operating Results](index=65&type=section&id=A.%20Operating%20Results) In 2020, total net revenues decreased by **11.8%** to **RMB 3.3 billion** due to COVID-19, while net income attributable to shareholders increased by **42.0%** to **RMB 268.3 million** Year-over-Year Financial Performance (2019 vs. 2020, in millions RMB) | Metric | 2019 | 2020 | % Change | | :--- | :--- | :--- | :--- | | **Total Net Revenues** | 3,706.0 | 3,268.1 | -11.8% | | Insurance Agency Revenue | 3,335.4 | 2,835.0 | -15.0% | | Claims Adjusting Revenue | 370.6 | 433.1 | +16.9% | | **Income from Operations** | 469.4 | 302.2 | -35.6% | | **Net Income Attributable to Shareholders** | 188.9 | 268.3 | +42.0% | - The decrease in insurance agency revenue was mainly due to a **22.9%** year-over-year decline in first-year life insurance premiums, attributed to the adverse impact of the COVID-19 pandemic[370](index=370&type=chunk) - The significant increase in net income was primarily due to a substantial decrease in the net share of income and impairment of affiliates, which was **negative RMB 2.7 million** in 2020 compared to **negative RMB 224.6 million** in 2019, driven by a much smaller impairment charge on the investment in CNFinance (**RMB 23.0 million** in 2020 vs. **RMB 322.7 million** in 2019)[379](index=379&type=chunk) [Liquidity and Capital Resources](index=82&type=section&id=B.%20Liquidity%20and%20Capital%20Resources) Fanhua's liquidity is primarily from operations, with **RMB 245.4 million** cash and **RMB 1.3 billion** short-term investments as of December 31, 2020, and no bank borrowings Summary of Cash Flows (in millions RMB) | Cash Flow Activity | 2019 | 2020 | | :--- | :--- | :--- | | Net cash from operating activities | 178.3 | 402.3 | | Net cash from investing activities | 12.0 | 325.3 | | Net cash used in financing activities | (792.1) | (638.8) | - As of December 31, 2020, the company had **RMB 245.4 million** in cash and cash equivalents and no short-term or long-term bank borrowings[383](index=383&type=chunk)[395](index=395&type=chunk) - Major uses of cash in financing activities in 2020 included **RMB 388.5 million** for dividend payments and **RMB 250.3 million** for refunding share rights deposits related to the canceled 521 plan[393](index=393&type=chunk) [Tabular Disclosure of Contractual Obligations](index=85&type=section&id=F.%20Tabular%20Disclosure%20of%20Contractual%20Obligations) As of December 31, 2020, Fanhua's primary contractual obligations were **RMB 219.4 million** in operating lease payments, with most due within three years Contractual Obligations as of December 31, 2020 (in millions RMB) | Obligation Type | Total | Less than 1 year | 1-3 years | 3-5 years | More than 5 years | | :--- | :--- | :--- | :--- | :--- | :--- | | Operating lease liabilities | 219.4 | 92.4 | 98.7 | 23.5 | 4.8 | [Directors, Senior Management and Employees](index=86&type=section&id=Item%206.%20Directors%2C%20Senior%20Management%20and%20Employees) This section details Fanhua's leadership, compensation, board structure, and workforce, including key executives, share incentive plans, and employee/agent counts [Directors and Senior Management](index=86&type=section&id=A.%20Directors%20and%20Senior%20Management) Fanhua's leadership includes Chairman and CEO Mr. Chunlin Wang and CFO Mr. Peng Ge, with detailed biographies for all directors and executive officers - The key leadership includes Mr. Chunlin Wang as Chairman and CEO, and Mr. Peng Ge as CFO and Director[409](index=409&type=chunk)[411](index=411&type=chunk)[412](index=412&type=chunk) - Executive officers have employment agreements that include confidentiality and non-competition clauses, which restrict them from joining competitors for one year following termination[418](index=418&type=chunk)[419](index=419&type=chunk) [Compensation](index=89&type=section&id=B.%20Compensation) In 2020, executive cash compensation was **RMB 2.4 million**, with share incentive plans like the 2007 Plan and the canceled 521 Plan used for talent retention - In 2020, aggregate cash compensation for executive officers was approximately **RMB 2.4 million (US$0.4 million)**[421](index=421&type=chunk) - The 521 Share Incentive Plan, which enabled participants to purchase **14 million ADSs**, was canceled in December 2020 because performance targets were not met[437](index=437&type=chunk)[439](index=439&type=chunk) [Board Practices](index=92&type=section&id=C.%20Board%20Practices) Fanhua's board comprises seven directors, mostly independent, and operates through four committees: Audit, Compensation, Corporate Governance & Nominating, and Financial Reporting & Disclosure - The board has **seven directors**, with a majority being independent, and has **four key committees**: Audit, Compensation, Corporate Governance & Nominating, and Financial Reporting & Disclosure[440](index=440&type=chunk)[442](index=442&type=chunk) - The Audit Committee is composed entirely of independent directors and includes a designated audit committee financial expert, Mr. Allen Lueth[442](index=442&type=chunk)[556](index=556&type=chunk) [Employees](index=95&type=section&id=D.%20Employees) As of December 31, 2020, Fanhua had **4,926** employees and a network of **362,580** registered sales representatives, emphasizing online and offline training Employee and Sales Agent Count | Category | Dec 31, 2019 | Dec 31, 2020 | | :--- | :--- | :--- | | Employees | 4,746 | 4,926 | | Registered Sales Representatives | 670,104 | 362,580 | [Share Ownership](index=96&type=section&id=E.%20Share%20Ownership) As of March 31, 2021, directors and executive officers collectively owned **27.0%** of outstanding shares, with co-founder Yinan Hu being the largest beneficial owner at **18.6%** - As of March 31, 2021, directors and executive officers as a group beneficially owned **27.0%** of the company's outstanding shares[457](index=457&type=chunk) - Co-founder Yinan Hu is the largest beneficial shareholder with **18.6%** ownership, including shares held through Sea Synergy Limited[457](index=457&type=chunk)[460](index=460&type=chunk) [Financial Information](index=97&type=section&id=Item%208.%20Financial%20Information) This section covers Fanhua's legal proceedings and dividend policy, noting immaterial fines in 2020 and a quarterly dividend payout ratio of no less than **50%** of net operating income - The company is not a party to any material litigation, but incurred administrative fines of **RMB 0.13 million** in 2020 from regulatory inquiries[462](index=462&type=chunk) - The company has a quarterly dividend policy with a payout ratio of no less than **50%** of net operating income attributable to shareholders, with the dividend being **US$0.25 per ADS** for each quarter of 2020[465](index=465&type=chunk)[466](index=466&type=chunk) [Additional Information](index=99&type=section&id=Item%2010.%20Additional%20Information) This section provides supplementary details on Fanhua's share capital, articles of association, material contracts, exchange controls, and taxation, including its PFIC status [Memorandum and Articles of Association](index=99&type=section&id=B.%20Memorandum%20and%20Articles%20of%20Association) Fanhua is incorporated in the Cayman Islands, with articles granting broad board powers and requiring a two-thirds majority for special resolutions - The company is incorporated under the laws of the Cayman Islands, which provides for different shareholder rights compared to U.S. jurisdictions[471](index=471&type=chunk)[472](index=472&type=chunk) - A special resolution, requiring a **two-thirds majority vote**, is needed for important matters such as a change of the company's name[477](index=477&type=chunk) [Taxation](index=101&type=section&id=E.%20Taxation) This subsection outlines tax frameworks in the Cayman Islands, PRC (**25% EIT**, **5% withholding tax** on dividends), and U.S., including Fanhua's PFIC status for prior years - The company is a tax-exempted entity in the Cayman Islands[485](index=485&type=chunk) - PRC subsidiaries are subject to a **25% EIT**, but dividends paid to the company's Hong Kong subsidiary are subject to a lower **5% withholding tax rate**[490](index=490&type=chunk)[799](index=799&type=chunk) - The company believes it was not a PFIC for U.S. federal income tax purposes in 2020, but was a PFIC for 2017 and prior years, which could have adverse tax consequences for U.S. Holders[164](index=164&type=chunk)[501](index=501&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=111&type=section&id=Item%2011.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Fanhua's primary market risks are minimal interest rate risk and foreign exchange risk, with a **10%** RMB appreciation potentially decreasing foreign currency assets by **RMB 7.3 million** - The company's main market risks are interest rate risk on its cash deposits and foreign exchange risk related to the RMB/USD exchange rate[533](index=533&type=chunk)[534](index=534&type=chunk) - As of December 31, 2020, a hypothetical **10% appreciation** of the RMB against the USD and HKD would have resulted in a decrease of **RMB 7.3 million** in the value of the company's foreign currency-denominated financial assets[535](index=535&type=chunk) PART II [Controls and Procedures](index=114&type=section&id=Item%2015.%20Controls%20and%20Procedures) Management concluded Fanhua's disclosure controls and internal control over financial reporting were effective as of December 31, 2020, with an unqualified auditor opinion - Management concluded that the company's disclosure controls and procedures were effective as of December 31, 2020[545](index=545&type=chunk) - Based on the COSO 2013 framework, management concluded that the internal control over financial reporting was effective as of December 31, 2020[548](index=548&type=chunk) - The independent auditor, Deloitte Touche Tohmatsu, issued an **unqualified opinion** on the effectiveness of the company's internal control over financial reporting as of December 31, 2020[550](index=550&type=chunk) [Corporate Governance and Other Matters](index=116&type=section&id=Item%2016.%20Corporate%20Governance%20and%20Other%20Matters) This section covers Fanhua's corporate governance, including its code of ethics, auditor fees (**US$1.6 million** in 2020), and use of NASDAQ "home country practice" exemptions - The company follows Cayman Islands "home country practice" which exempts it from the NASDAQ requirement to hold an annual shareholder meeting[563](index=563&type=chunk) Principal Accountant Fees (in millions USD) | Fee Type | 2019 | 2020 | | :--- | :--- | :--- | | Audit fees | 1.693 | 1.600 | | Audit-related fees | 0.251 | — | | All other fees | 0.000 | — | PART III [Financial Statements](index=118&type=section&id=Item%2018.%20Financial%20Statements) This section presents Fanhua's audited consolidated financial statements for 2018-2020, prepared under U.S. GAAP, with an unqualified opinion from Deloitte Touche Tohmatsu - The independent auditor, Deloitte Touche Tohmatsu, issued an **unqualified opinion** on the consolidated financial statements for the three years ended December 31, 2020[578](index=578&type=chunk) - The auditor's report identifies the Other-than-temporary Impairment (OTTI) assessment of the equity method investment in CNFinance Holdings Limited as a **critical audit matter** due to the significant judgment required[585](index=585&type=chunk)[587](index=587&type=chunk) - The company adopted new accounting standards for leases (ASC 842) in 2019 and for credit losses (ASU 2016-13) in 2020, with the latter resulting in a **RMB 7.5 million reduction** to opening retained earnings[581](index=581&type=chunk)[728](index=728&type=chunk) [Exhibits](index=118&type=section&id=Item%2019.%20Exhibits) This section lists all exhibits filed with the annual report, including corporate governance documents, share incentive plans, and Sarbanes-Oxley Act certifications - The report includes key corporate governance documents such as the Amended and Restated Memorandum and Articles of Association and the 2007 Share Incentive Plan[570](index=570&type=chunk) - Certifications by the CEO and CFO as required by Sections 302 and 906 of the Sarbanes-Oxley Act are filed as exhibits[570](index=570&type=chunk)

Fanhua Inc. (NASDAQ:FANH) Q4 2020 Earnings Conference Call March 16, 2021 9:00 PM ET Company Participants Oasis Qiu - IR Manager Chunlin Wang - Chairman & CEO Conference Call Participants Operator Thank you for standing by for Fanhua's Fourth Quarter and Fiscal Year 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. All lines have been placed on mute to prevent background noise. After the management's prepared remarks there will be a question-and-answer session [Operato ...

Fanhua, Inc. (NASDAQ:FANH) Q3 2020 Earnings Conference Call November 24, 2020 8:00 PM ET Company Participants Oasis Qiu - IR Manager Chunlin Wang - Chairman & CEO Conference Call Participants Yuan Xue - China International Capital Corporation Limited Frank Auyeung - Morgan Stanley Operator Thank you for standing by for Fanhua's Third Quarter 2020 Earnings Conference Call. [Operator Instructions]. For your information, this conference call is now being webcasted live over the Internet. Webcast replay will be ...

Start Time: 21:00 January 1, 0000 9:37 PM ET Fanhua Inc. (NASDAQ:FANH) Q2 2020 Earnings Conference Call August 24, 2020, 21:00 AM ET Company Participants Chunlin Wang - Chairman and CEO Peng Ge - CFO Oasis Qiu - IR Manager Conference Call Participants Yuan Xue - CICC Michael Chu - Franklin Templeton Operator Thank you for standing by for Fanhua’s Second Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. All lines have been placed on mute to prevent background no ...

Fanhua Inc. (NASDAQ:FANH) Q1 2020 Earnings Conference Call May 26, 2020 9:00 PM ET Company Participants Oasis Qiu - IR Manager Chunlin Wang - Chairman & CEO Peng Ge - CFO Conference Call Participants Yuan Xue - CICC Debra Fiakas - Crystal Equity Research Operator Ladies and gentlemen, thank you for standing by for Fanhua’s First Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. All lines have been placed on mute to prevent the background noise. After the manage ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Title of Each Class Ticker Symbol(s) Name of Each Exchange on Which Registered Ordinary shares, par value US$0.001 per share* American depositary shares, each representing 20 ordinary shares FANH The NASDAQ Stock Market LLC (The NASDAQ Global Select Market) FORM 20-F (Mark One) ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECU ...

Fanhua Inc. (NASDAQ:FANH) Q4 2019 Earnings Conference Call March 18, 2020 9:00 PM ET Company Participants Oasis Qiu - Investor Relations Manager Chunlin Wang - Chairman and Chief Executive Officer Peng Ge - Chief Financial Officer Conference Call Participants Yuan Xue - CICC Debra Fiakas - Crystal Equity Research Operator Thank you for standing by for Fanhua’s Fourth Quarter and Full-Year 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. All lines have been placed on m ...

Financial Data and Key Metrics Changes - In Q3 2019, the company's operating income reached RMB151.4 million, representing a year-over-year growth of 21.6% [10] - Non-GAAP operating income decreased by 10.4% year-over-year to RMB111.6 million, attributed to a high base from the previous year due to a one-off performance bonus of approximately RMB38 million [10] Business Line Data and Key Metrics Changes - The life insurance business grew by 42% year-over-year to RMB2.1 billion, significantly outpacing industry growth [11] - Renewal insurance premiums increased by 46% year-over-year to RMB1.4 billion, while first-year regular premiums grew by 34.5% to RMB683.6 million [11] - Annuity insurance products accounted for 29.8% of total life insurance business, up from 11.3% in the same period last year [11] - Claims adjusting business net revenues were RMB94.8 million, up 18.6% year-over-year, driven by strong growth in medical insurance-related claims adjusting [12] Market Data and Key Metrics Changes - The life insurance industry in China is experiencing a continuous quarter-by-quarter slowdown in growth, with negative growth expected in new premiums for regular individual life insurance for the full year of 2019 [8] - The company reported a steady growth of approximately 50,000 new recruits per quarter, with a total of 658,145 registered sales agents as of September 30, 2019 [12] Company Strategy and Development Direction - The company is focused on executing the Shenzhou 100 strategy and the 1000 Reserve Entrepreneurial Sales Teams Campaign to strengthen its sales force and tap into market potential in medium and large-sized cities [18] - The company believes that the ongoing industry adjustment will provide opportunities for strategic deployment and consolidation, allowing it to solidify its leading position [17] Management's Comments on Operating Environment and Future Outlook - Management expressed that the industry dynamics, including the U.S.-China trade war and regulatory pressures, are expected to continue impacting growth in 2020 [8] - The company anticipates annualized premium equivalent growth of no less than 10% year-over-year and non-GAAP operating income growth of no less than 20% year-over-year for Q4 2019 [16] Other Important Information - The quarterly dividend for Q3 2019 is set at USD0.30 per ADS, payable on December 19, 2019 [16] - The online platform eHuzhu has approximately 3.8 million effective registered members, and Baowang's registered accounts increased by 30.8% year-over-year to 2.6 million [15] Q&A Session Summary Question: Why did the number of sales agents and annualized premium equivalent decrease sequentially from the second quarter? - The decrease in sales agents was due to a cleanup required by regulators, which imposed caps on the number of agents each agency can have [20] - The company expects to maintain a steady pace of new recruits going forward, targeting approximately 50,000 per quarter [21] Question: What are the recent developments in the Shenzhou 100 strategy? - The Shenzhou 100 strategy has received enthusiastic market response, with the establishment of three provincial branches and ongoing recruitment of managerial talent [26][28] Question: What is the performance of active users on the Lan Zhanggui platform? - The decrease in active users is attributed to the sales force cleanup, but first-year premium recorded strong growth year-over-year, indicating improved productivity per person [35]