X Financial (XYF) Q3 Earnings call transcript Nov 27, 2024
1min read X Financial, a leading player in China's personal finance market, reported robust earnings for the third quarter of 2024. The company's financial performance underscores its strategic balance between growth and profitability, positioning it well for the future.
Strong Quarterly Results
X Financial reported a significant sequential improvement in asset quality, with loan volumes exceeding forecasts. This achievement was marked by a decline in delinquency rates for outstanding loans, signaling a positive trend in risk management. The company's total loan amount facilitated and originated reached RMB 28 billion, up 25% sequentially. This performance is a testament to the company's agility in adjusting loan volumes based on risk levels and its commitment to maintaining a healthy balance sheet.
Strategic Dividend Policy and Share Repurchase Programs
The company's financial health is reflected in its strong profitability. Total net revenue reached RMB 1.6 billion, up 13% year-on-year and 15% sequentially. Net income stood at RMB 376 million, up 6% year-on-year and sequentially. Moreover, non-GAAP adjusted net income hit a record high of RMB 434 million. These figures demonstrate the company's ability to generate substantial revenue and profit, underpinning its strong financial position.
X Financial also announced its intention to return more value to shareholders through its semi-annual dividend policy and share repurchase programs. The company has extended the period of its USD 30 million share repurchase program until the end of March 2026. This commitment to enhancing shareholder value reflects the company's confidence in its future growth prospects and its dedication to rewarding its investors.
Regulatory Landscape and Future Outlook
The regulatory environment for X Financial remains stable, with no significant regulations expected in the near term. However, the Chinese government's comprehensive stimulus package, aimed at boosting the economy, is expected to provide a meaningful boost to the personal finance market. X Financial, as an integral part of the economy, is poised to benefit from this macroeconomic recovery. The company expects its monthly loan volume to exceed RMB 10 billion in the fourth quarter, setting a new record.
Conclusion
X Financial's Q3 earnings call highlights its robust financial performance and strategic focus on both growth and profitability. The company's commitment to enhancing shareholder value through dividends and share repurchases underscores its confidence in its future prospects. With a stable regulatory environment and a favorable macroeconomic outlook, X Financial is well-positioned to continue its growth trajectory. Investors and analysts will closely watch the company's performance in the coming quarters as it navigates the opportunities and challenges of China's personal finance market.