Financial Data and Key Metrics Changes - Total net revenue for Q2 2024 was RMB 1.4 billion, representing a 12.5% increase year-on-year and a 14% increase sequentially [8][9] - Net income grew 13% year-on-year and 14% sequentially to RMB 415 million, marking a record high [8][9] - Total loan amount facilitated and originated decreased by 12% year-on-year but increased by 6% sequentially to RMB 23 billion [6][8] Business Line Data and Key Metrics Changes - Origination and service expenses increased by 19% to RMB 415 million from RMB 349 million in the same period of 2023 [9][10] - Provision for loans receivable was RMB 96 million compared to RMB 55 million in the same period of 2023, indicating an increase in loans receivable [10] Market Data and Key Metrics Changes - Delinquency rates for outstanding loans past due for 31-60 days and 91-180 days were 1.29% and 4.38%, respectively, showing improvement from the previous quarter [6] Company Strategy and Development Direction - The company aims to improve profitability while managing loan volumes based on asset quality dynamics [5][6] - There is a focus on sustainable profitability and refining risk management systems to enhance asset quality [6][8] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in loan volume growth for Q3 due to improved delinquency performance and optimized approval policies [13] - The company does not foresee a significant improvement in the overall economy but believes its risk management efficiency will enhance performance [17][18] Other Important Information - A semiannual dividend of USD 0.17 per ADS was declared for the first half of 2024 [11] - A new share repurchase program of 20 million shares was announced in May 2024 [8] Q&A Session Summary Question: What gives confidence for the increase in loan volumes for Q3? - Management indicated that improved delinquency performance and optimized approval policies contribute to confidence in loan volume growth [13] Question: Can you discuss customer acquisition costs? - Management noted that acquisition costs have remained constant, and with higher approval rates, spending will increase, leading to higher loan volumes [15] Question: Is there an improvement in consumer health affecting approval rates? - Management clarified that while the overall economy has not improved significantly, better customer segmentation and new channels have enhanced customer quality [17][18] Question: What is driving the increase in active borrowers despite lower loan volumes? - Management confirmed that the average loan size has decreased as part of risk management, and as the environment improves, the average loan size is expected to grow [20]
X Financial(XYF) - 2024 Q2 - Earnings Call Transcript