Fang Holdings(SFUNY) - 2020 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - CIH reported total revenues of RMB 170.9 million in Q3 2020, an increase of 8% from RMB 158.3 million in Q3 2019 [6] - Operating income was RMB 86.6 million in Q3 2020, an increase of 13.1% from RMB 76.6 million in Q3 2019 [9] - Net income was RMB 76.1 million in Q3 2020, an increase of 15.3% from RMB 66 million in Q3 2019 [11] - Income tax expenses were RMB 13.3 million in Q3 2020, an increase of 20.9% from RMB 11 million in Q3 2019 [10] Business Line Data and Key Metrics Changes - Revenues from information and analytics services were RMB 88.8 million in Q3 2020, an increase of 14.4% from RMB 77.6 million in Q3 2019 [6] - Revenues from marketplaces were RMB 82.1 million in Q3 2020, an increase of 1.7% from RMB 80.7 million in Q3 2019 [7] - Cost of revenue was RMB 29.3 million in Q3 2020, stable compared to RMB 29.2 million in Q3 2019 [7] - Operating expenses were RMB 55 million in Q3 2020, an increase of 4.8% from RMB 52.5 million in Q3 2019 [8] Market Data and Key Metrics Changes - The company noted a slowdown in total revenue growth in Q3 2020 due to a tighter regulatory environment affecting cash flows of clients, particularly in the financial services sector [15][16] Company Strategy and Development Direction - The company aims to increase the number of cities it operates in throughout China, with a goal of having 40 offices by early 2021 [18] - CIH is increasing investments in database building and R&D in new technologies, focusing on big data and technology investments [19][20] - The company is cautious in its investment approach but actively seeking opportunities that align with its business model [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining double-digit growth momentum for both annual revenue and net profit for the fiscal year ending December 31, 2020 [11] - The tightening macroeconomic background and regulatory environment have impacted growth, but management remains optimistic about future prospects [16][17] Other Important Information - The company has a significant portion of its total assets in cash and short-term investments, accounting for around 80% of total assets [14] Q&A Session Summary Question: What is the reason behind the slowdown in total revenue growth in Q3 2020? - Management acknowledged the slowdown was due to a tighter regulatory environment affecting client cash flows, leading to discounts provided to clients [15][16] Question: What are the plans for the cash and short-term investments? - Management indicated that they are looking for investment opportunities, particularly in big data and technology, while being cautious in their approach [20][21] Question: What is the company's business plan for Q4 2020 and 2021? - The company plans to expand its presence in more cities and increase investments in big data and technology development [18][19]