Company Operations and Market Position - The company operates primarily in the micro-finance sector in Deqing County, Huzhou City, Zhejiang Province, with a significant market share in this region[12]. - The economic development in Deqing has been strong, recognized as a "strong county in technology" and a "demonstration county for financial innovation" by the Zhejiang provincial government[12]. - The company is positioned to benefit from the national policy aimed at supporting high-quality development in Zhejiang Province, which includes a series of major decision-making deployments[12]. - Deqing has been identified as a key area for green financial reform and innovation, providing better opportunities for the company's exploration of green development[12]. - The company has been recognized as the first green microfinance company pilot unit in Huzhou since April 2020, enhancing its market position[97]. - The company actively explores sustainable green credit pathways and has developed new loan products to increase market penetration[97]. Financial Performance - As of June 30, 2021, the total loan balance (excluding accrued interest) increased from RMB 2,557.7 million to RMB 2,666.6 million, representing a growth of approximately 4.3%[14]. - The total amount of loans issued by the company and three other small loan companies in Deqing reached RMB 1.79 billion, with the company accounting for about 84.2% of this total[13]. - The company's leverage ratio increased from 2.17 to 2.26, indicating a higher level of borrowing relative to its registered capital of RMB 1.18 billion[17]. - The average interest rate on loans decreased from 12.2% to 10.2% due to increased support for small and micro enterprises amid the COVID-19 pandemic[18]. - The non-performing loan ratio rose slightly from 4.8% to 4.9%, with non-performing loans increasing from RMB 123.2 million to RMB 131.1 million[23]. - The provision coverage ratio remained stable at 153%, with total provisions for impairment losses increasing from RMB 187.5 million to RMB 201.1 million[23]. - The company reported a total profit and comprehensive income of RMB 67,039 thousand for the six months ended June 30, 2021, compared to RMB 67,563 thousand in the same period of 2020[104]. - Basic and diluted earnings per share for the period were RMB 0.05, down from RMB 0.06 in the previous year[104]. Loan Portfolio and Asset Quality - The company primarily serves small and micro enterprises, with 75.4% of loan amounts being RMB 1 million or less as of June 30, 2021[18]. - The total amount of loans and advances to customers (excluding accrued interest) was RMB 2,699.7 million as of June 30, 2021, compared to RMB 2,587.7 million at the end of 2020[19]. - The company experienced a decrease in average loan interest rates due to increased competition and policy measures to support small and micro enterprises during the COVID-19 pandemic[36]. - The overdue loans as of June 30, 2021, amounted to RMB 131.2 million, representing approximately 4.9% of the total loans and advances provided[64]. - The company’s total balance of loans and advances to customers with credit impairment was RMB 131,139,000 as of June 30, 2021, slightly down from RMB 123,223,000 as of December 31, 2020, indicating a decrease of approximately 6.5%[189]. - The company’s total balance of loans and advances to customers without credit impairment was RMB 2,531,113,000 as of June 30, 2021, reflecting a stable performance compared to the previous period[189]. Operational Efficiency and Costs - Administrative expenses totaled RMB 28.9 million for the six months ended June 30, 2021, compared to RMB 24.6 million in the same period of 2020, with employee costs rising to RMB 9.8 million from RMB 8.2 million[43][46]. - The effective tax rate for the six months ended June 30, 2021, was 26.2%, slightly up from 25.5% in the previous year, with income tax expenses of RMB 23.9 million compared to RMB 23.1 million[47]. - The company employed approximately 113 employees as of June 30, 2021, down from 121 employees as of December 31, 2020[87]. Cash Flow and Liquidity - The net cash used in operating activities for the six months ended June 30, 2021, was RMB 16.1 million, with a pre-tax profit of RMB 90.9 million[55]. - The company’s cash and cash equivalents totaled RMB 11.5 million as of June 30, 2021, down from RMB 78.2 million as of December 31, 2020[59]. - The net cash used in financing activities for the six months ended June 30, 2021, was RMB 50.9 million, primarily due to the repayment of interest-bearing loans[57]. - The company plans to maintain optimal liquidity levels to support operational needs and potential business expansion[49]. Future Outlook and Strategic Initiatives - The company is focused on expanding its market presence in the micro-finance sector, particularly in areas with strong economic growth potential[12]. - The company aims to leverage the favorable financial ecosystem in Huzhou to enhance its service offerings and customer base[12]. - The company plans to enhance its market expansion strategies and product development in the upcoming quarters, focusing on technology-driven solutions[148].
佐力小贷(06866) - 2021 - 中期财报