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360 DigiTech Announces First Quarter 2022 Unaudited Financial Results and Declares Quarterly Dividend

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SHANGHAI, May 24, 2022 (GLOBE NEWSWIRE) -- 360 DigiTech, Inc. (QFIN) (“360 DigiTech” or the “Company”), a leading Credit-Tech platform in China, today announced its unaudited financial results for the first quarter ended March 31, 2022.

First Quarter 2022 Business Highlights

  • As of March 31, 2022, our platform has connected 122 financial institutional partners and 192.9 million consumers*1 with potential credit needs, cumulatively, an increase of 14.1% from 169.1 million a year ago.

  • Cumulative users with approved credit lines*2 were 39.8 million as of March 31, 2022, an increase of 21.7% from 32.7 million as of March 31, 2021.

  • Cumulative borrowers with successful drawdown, including repeat borrowers was 25.0 million as of March 31, 2022, an increase of 19.0% from 21.0 million as of March 31, 2021.

  • In the first quarter of 2022, financial institutional partners originated 14,262,386 loans*3 through our platform. Total facilitation and origination loan volume reached RMB98,833 million*4, an increase of 33.3% from RMB74,149 million in the same period of 2021.

  • Out of those loans originated by financial institutions, RMB53,327 million was under capital-light model, Intelligence Credit Engine (“ICE”) and other technology solutions, representing 54.0% of the total, an increase of 43.2% from RMB37,245 million in the same period of 2021.

  • Total outstanding balance*5 of the loans originated by financial institutional partners through our platform was RMB146,720 million as of March 31, 2022, an increase of 44.0% from RMB101,920 million as of March 31, 2021.

  • RMB78,804 million of such loan balance was under capital-light model, “ICE” and other technology solutions, an increase of 84.2% from RMB42,775 million as of March 31, 2021.

  • Financial institutions granted approximately RMB7.4 billion credit lines to small and micro-sized enterprises and their owners (collectively, SMEs)*6 through our platform in the first quarter of 2022.

  • The weighted average contractual tenor of loans originated by financial institutions across our platform in the first quarter of 2022 was approximately 10.99 months, compared with 10.17 months in the same period of 2021.

  • 90 day+ delinquency rate*7 of loans originated by financial institutions across our platform was 2.40% as of March 31, 2022.

  • Repeat borrower contribution*8 of loans originated by financial institutions across our platform for the first quarter of 2022 was 87.8%.

1 Refers to cumulative registered users across our platform.
2 “Users with approved credit lines” refers to the total number of users who had submitted their credit applications and were approved with a credit line at the end of each period.
3 Including 4,189,074 loans across “V-pocket”, and 10,073,312 loans across other products.
4 Refers to the total principal amount of loans facilitated and originated during the given period, including loan volume facilitated through Intelligence Credit Engine (“ICE”) and other technology solutions. “ICE” is an open platform on our “360 Jietiao” APP, we match borrowers and financial institutions through big data and cloud computing technology on “ICE”, and provide pre-loan investigation report of borrowers. For loans facilitated through “ICE”, the Company do not bear principal risk.
5 “Total outstanding loan balance” refers to the total amount of principal outstanding for loans facilitated and originated at the end of each period, including loan balance for “ICE” and other technology solutions, excluding loans delinquent for more than 180 days.
6 SME loans are loans issued to SMEs with e-commerce operations, with business sales receipt, and/or with business taxation record.
7 “90 day+ delinquency rate” refers to the outstanding principal balance of on- and off-balance sheet loans that were 91 to 180 calendar days past due as a percentage of the total outstanding principal balance of on- and off-balance sheet loans across our platform as of a specific date. Loans that are charged-off and loans under “ICE” and other technology solutions are not included in the delinquency rate calculation.
8 “Repeat borrower contribution” for a given period refers to (i) the principal amount of loans borrowed during that period by borrowers who had historically made at least one successful drawdown, divided by (ii) the total loan facilitation and origination volume through our platform during that period.

First Quarter 2022 Financial Highlights

  • Total net revenue increased by 20.0% to RMB4,320.0 million (US$681.5 million) from RMB3,599.2 million in the same period of 2021.

  • Income from operations was RMB1,359.3 million (US$214.4 million), compared to RMB1,557.8 million in the same period of 2021.

  • Non-GAAP*9 income from operations was RMB1,411.3 million (US$222.6 million), compared to RMB1,617.3 million in the same period of 2021.

  • Operating margin was 31.5%. Non-GAAP operating margin was 32.7%.

  • Net income was RMB1,174.4 million (US$185.2 million), compared to RMB1,347.2 million in the same period of 2021.

  • Non-GAAP net income was RMB1,226.4 million (US$193.5 million, compared to RMB1,406.8 million in the same period of 2021.

  • Net income attributed to the Company was RMB1,179.5 million (US$186.1 million), compared to RMB1,347.4 million in the same period of 2021.

  • Net income margin was 27.2%. Non-GAAP net income margin was 28.4%.

9 Non-GAAP income from operations (Adjusted Income from operations), Non-GAAP net income (Adjusted net income), Non-GAAP operating margin and Non-GAAP net income margin are non-GAAP financial measures. For more information on this non-GAAP financial measure, please see the section of “Use of Non-GAAP Financial Measures Statement” and the table captioned "Unaudited Reconciliations of GAAP and Non-GAAP Results" set forth at the end of this press release.

Mr. Haisheng Wu, Chief Executive Officer and Director of 360 DigiTech, commented, “We are pleased to report another solid quarter despite amidst dampened macroeconomic environment and the resurgence of the COVID-19 in certain regions of China. In the first quarter, Total facilitation and origination volume was RMB98.8 billion, up approximately 33% year-on-year. Approximately 54% of the loans was facilitated under the capital-light model, ICE and other technology solutions*10, as we continued to pursue long term sustainable technology driven business models.

More importantly, we are making significant progress to serve user segments with lower overall credit risk and higher retention. As a result, we further lowered our product pricing during this quarter. Average IRR of the cap-heavy and cap-light loans originated through our platform was already below 24% in the first quarter, and we are confident to move ahead of the schedule to meet the rate cap requirement. During the quarter, we also continued to expand our financial institution partnership, particularly with larger banks with national coverage, to secure ample funding sources at competitive terms.

On the regulatory front, as one of the leading Credit-Tech platforms, we have worked diligently to implement necessary rectification to our operations according to regulatory guidance and requirements. We are encouraged by recent public comments from regulators, which continue to support healthy development of platform economy and suggest changing regulatory focus from rectification toward regular supervision.”

“We are very glad to report a solid quarter of strong financial results in a challenging macro environment. Total revenue was RMB4.32 billion and non-GAAP net income was RMB1.23 billion,” Mr. Alex Xu, Chief Financial Officer, commented. “Although demand for consumer credit was as expected with normal seasonality in the first quarter, we started to take prudent approach to operate our business to better navigate through the uncertainty resulting from the challenging macro backdrop. At the end of the first quarter, our total cash and cash equivalent was approximately RMB9.8 billion, of which approximately RMB6.2 billion was non-restricted, giving us ever strong financial positions to support our long term growth while dealing with near term economic challenges.”

Mr. Yan Zheng, Chief Risk Officer, added, “First quarter was a very dynamic period from risk management perspective. On one hand, as we optimized our risk model and brought in more high quality users, overall risk profile of our borrowers improved noticeably, as indicated by the improving Day-1 delinquency*11 to 5.2% from 5.4% a quarter ago. On the other hand, 30-day collection rate*12 declined modestly to 86% from 87% quarter-by-quarter, mainly because we had to adjust our collection operations in regions being significantly impacted by the resurgence of the COVID-19. Overall, we believe asset quality will gradually improve later in the year, particularly in the second half, primarily due to our further penetration into better user segments.”

10 We’ve mainly used data technology tools and AI credit assessment systems in the process of providing such services as loan facilitation, post-facilitation and borrowers’ referral to our customers. Revenue from these technology powered services accounted for 45% of our total net revenue for the first quarter 2022.
11 “D1 delinquency rate” is defined as (i) the total amount of principal that became overdue as of a specified date, divided by (ii) the total amount of principal that was due for repayment as of such date.
12 “M1 collection rate” is defined as (i) the amount of principal that was repaid in one month among the total amount of principal that became overdue as of specified date, divided by (ii) the total amount of principal that became overdue as of a specified date.

First Quarter 2022 Financial Results

Total net revenue was RMB4,320.0 million (US$681.5 million), compared to RMB3,599.2 million in the same period of 2021, and RMB4,422.1 million in the prior quarter.

Net revenue from Credit Driven Services was RMB2,920.6 million (US$460.7 million), compared to RMB2,451.3 million in the same period of 2021, and RMB2,713.2 million in the prior quarter.

Loan facilitation and servicing fees-capital heavy were RMB561.4 million (US$88.6 million), compared to RMB724.3 million in the same period of 2021 and RMB479.9 million in the prior quarter. The year-over-year decline was driven by lower interest rates of the capital heavy loans, and the sequential increase was primarily due to higher average tenor of the loans.

Financing income*13 was RMB789.2 million (US$124.5 million), compared to RMB409.4 million in the same period of 2021 and RMB716.1 million in the prior quarter. The year-over-year and sequential increases were primarily due to the growth in outstanding on-balance-sheet loan balance.

Revenue from releasing of guarantee liabilities was RMB1,550.0 million (US$244.5 million), compared to RMB1,295.4 million in the same period of 2021, and RMB1,494.7 million in the prior quarter. The year-over-year and sequential growth mainly reflected increasing trends in average outstanding balance of off-balance-sheet capital-heavy loans during the period.

Other services fees were RMB20.0 million (US$3.2 million), compared to RMB22.2 million in the same period of 2021, and RMB22.5 million in the prior quarter. The year-over-year and sequential declines were mainly due to declines in late payment fees under capital-heavy model.

Net revenue from Platform Services was RMB1,399.4 million (US$220.8 million), compared to RMB1,147.9 million in the same period of 2021 and RMB1,708.9 million in the prior quarter.

Loan facilitation and servicing fees-capital light were RMB1,098.9 million (US$173.4 million), compared to RMB993.9 million in the same period of 2021 and RMB1,485.3 million in the prior quarter. The year-over-year growth was primarily due to the growth in outstanding loan balance under capital-light model, the sequential decline was mainly due to the decline in loan facilitation volume under capital-light model as well as lower average prices.

Referral services fees were RMB247.3 million (US$39.0 million), compared to RMB126.3 million in the same period of 2021 and RMB177.4 million in the prior quarter. The year-over-year and sequential increases were primarily due to the growth in facilitation volume through ICE.

Other services fees were RMB53.2 million (US$8.4 million), compared to RMB27.6 million in the same period of 2021 and RMB46.2 million in the prior quarter. The year-over-year and sequential growth reflected the growth in late payment fees under capital-light model.

Total operating costs and expenses were RMB2,960.8 million (US$467.1 million), compared to RMB2,041.4 million in the same period of 2021 and RMB2,940.5 million in the prior quarter.

Facilitation, origination and servicing expenses were RMB614.9 million (US$97.0 million), compared to RMB477.8 million in the same period of 2021 and RMB589.2 million in the prior quarter. The year-over-year and sequential increases were in part due to growth in loan facilitation and origination volume and balance.

Funding costs were RMB103.8 million (US$16.4 million), compared to RMB79.1million in the same period of 2021 and RMB91.4 million in the prior quarter. The year-over-year and sequential increase were mainly due to the growth in funding from ABS and trusts.

Sales and marketing expenses were RMB552.6 million (US$87.2 million), compared to RMB385.0 million in the same period of 2021 and RMB628.2 million in the prior quarter. The year-over-year increase was mainly due to the growth of loan facilitation and origination volume. The sequential decline was in part due to normal seasonality associated with the Chinese New Year holidays.

General and administrative expenses were RMB122.3 million (US$19.3 million), compared to RMB104.5 million in the same period of 2021 and RMB140.5 million in the prior quarter. The year-over-year increase was due to expanded business operations. The sequential decline was due to lower professional service fees and our continued effort to improve operational efficiency.

Provision for loans receivable was RMB491.2 million (US$77.5 million), compared to RMB134.9 million in the same period of 2021 and RMB223.1 million in the prior quarter. The year-over-year and sequential increases were mainly due to growth in on-balance sheet loans and reflected the Company’s consistent approach in assessing provisions commensurate with its underlying loan profile.

Provision for financial assets receivable was RMB60.5 million (US$9.5 million), compared to RMB45.1 million in the same period of 2021 and RMB70.3 million in the prior quarter. The fluctuations were consistent with trends in facilitation volume of off-balance-sheet capital-heavy loans.

Provision for accounts receivable and contract assets was RMB53.6 million (US$8.5 million), compared to RMB56.4 million in the same period of 2021 and RMB38.4 million in the prior quarter. The year-over-year decline was primarily due to a decrease in facilitation volume under capital-light model. The sequential increase mainly reflected the Company’s consistent approach in assessing provisions commensurate with its underlying loan profile.

Provision for contingent liability was RMB961.9 million (US$151.7 million), compared to RMB758.7 million in the same period of 2021 and RMB1,159.3 million in the prior quarter. The year-over-year and sequential changes were largely driven by the change in facilitation volume of off-balance-sheet capital-heavy loans and also reflected the Company’s consistent approach in assessing provisions commensurate with its underlying loan profile.

Income from operations was RMB1,359.3 million (US$214.4 million), compared to RMB1,557.8 million in the same period of 2021 and RMB1,481.6 million in the prior quarter.

Non-GAAP income from operations was RMB1,411.3 million (US$222.6 million), compared to RMB1,617.3 million in the same period of 2021 and RMB1,539.1 million in the prior quarter.

Operating margin was 31.5%. Non-GAAP operating margin was 32.7%.

Income before income tax expense was RMB1,390.8 million (US$219.4 million), compared to RMB1,605.3 million in the same period of 2021 and RMB1,541.5million in the prior quarter.

Net income attributed to the Company was RMB1,179.5 million (US$186.1 million), compared to RMB1,347.4 million in the same period of 2021 and RMB1,322.6 million in the prior quarter.

Non-GAAP net income attributed to the Company was RMB1,231.6 million (US$194.3 million), compared to RMB1,407.0 million in the same period of 2021 and RMB1,380.1 million in the prior quarter.

Net income margin was 27.2%. Non-GAAP net income margin was 28.4%.

Net income per fully diluted ADS was RMB7.36 (US$1.16).

Non-GAAP net income per fully diluted ADS was RMB7.68 (US$1.21).

Weighted average basic ADS used in calculating GAAP and non-GAAP net income per ADS was 155.30 million.

Weighted average diluted ADS used in calculating GAAP and non-GAAP net income per ADS was 160.46 million.

13 “Financing income” is generated from loans facilitated through the Company’s platform funded by the consolidated trusts and Fuzhou Microcredit, which charge fees and interests from borrowers.

M1+ Delinquency Rate by Vintage and M6+ Delinquency Rate by Vintage

The following charts and tables display the historical cumulative M1+ delinquency rates by loan facilitation and origination vintage and M6+ delinquency rates by loan facilitation and origination vintage for all loans facilitated and originated through the Company’s platform. Loans that are charged-off and loans under “ICE” and other technology solutions are not included in the M1+ charts, and loans under “ICE” and other technology solutions are not included in the M6+ charts:

http://ml.globenewswire.com/Resource/Download/37192df0-2cf1-4fcc-8406-2b7da730a44a

http://ml.globenewswire.com/Resource/Download/54d392cd-30c5-47cd-8f30-3979f844e5a7

Quarterly Dividend

The board of directors of the Company has approved a dividend of US$0.11 per ordinary share, or US$0.22 per ADS, for the first fiscal quarter of 2022 in accordance with the Company’s dividend policy, which is expected to be paid on July 27, 2022 to shareholders of record as of the close of business on June 20, 2022.

Business Outlook

Given the current macro environment and the resurgence of COVID-19, the Company would like to maintain its outlook for loan facilitation and origination volume for 2022 at between RMB410 billion and RMB450 billion, representing year-on-year growth of 15% to 26%. This outlook reflects the Company’s current and preliminary views, which is subject to material changes.

Conference Call

360 DigiTech’s management team will host an earnings conference call at 8:30 PM U.S. Eastern Time on Tuesday, May 24, 2022 (8:30 AM Beijing Time on May 25).

United States:

+1-646-722-4977

Hong Kong:

+852-3027-6500

Mainland China:

400-821-0637

International:

+65-6408-5782

PIN:

20100839#

 

 

Please dial in 15 minutes before the call is scheduled to begin and provide the PIN to join the call.

A telephone replay of the call will be available after the conclusion of the conference call until May 31, 2022:

United States:

+1-646-982-0473

International:

+65-6408-5781

Access code:

520002349#

 

 

Additionally, a live and archived webcast of the conference call will be available on the Investor Relations section of the Company's website at ir.360shuke.com.

About 360 DigiTech

360 DigiTech, Inc. (NASDAQ: QFIN) (“360 DigiTech” or the “Company”) is a leading Credit-Tech platform. Through its platform the Company enables financial institutions to provide better and targeted products and services to a broader consumer base. The Company also offers standardized risk management service, in the form of SaaS modules to institutional clients. The Company’s solutions provide seamless experiences and create noticeable advantages in customer acquisition, funding optimization, risk assessment and post-lending management.

For more information, please visit: ir.360shuke.com

Use of Non-GAAP Financial Measures Statement

To supplement our financial results presented in accordance with U.S. GAAP, we use non-GAAP financial measure, which is adjusted from results based on U.S. GAAP to exclude share-based compensation expenses. Reconciliations of our non-GAAP financial measures to our U.S. GAAP financial measures are set forth in tables at the end of this earnings release, which provide more details on the non-GAAP financial measures.

We use non-GAAP income from operation, non-GAAP operation margin, non-GAAP net income, non-GAAP net income margin, Non-GAAP net income attributed to the Company and Non-GAAP net income per fully diluted ADS in evaluating our operating results and for financial and operational decision-making purposes. Non-GAAP income from operation represents income from operation excluding share-based compensation expenses, non-GAAP net income represents net income excluding share-based compensation expenses, non-GAAP net income attributed to the Company represents net income attributed to the Company excluding share-based compensation expenses and non-GAAP net income per fully diluted ADS represents net income per fully diluted ADS excluding share-based compensation. Such adjustments have no impact on income tax. We believe that non-GAAP income from operation and non-GAAP net income help identify underlying trends in our business that could otherwise be distorted by the effect of certain expenses that we include in results based on U.S. GAAP. We believe that non-GAAP income from operation and non-GAAP net income provide useful information about our operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making. Our non-GAAP financial information should be considered in addition to results prepared in accordance with U.S. GAAP, but should not be considered a substitute for or superior to U.S. GAAP results. In addition, our calculation of non-GAAP financial information may be different from the calculation used by other companies, and therefore comparability may be limited.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB6.3393 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of March 31, 2022.

Safe Harbor Statement

Any forward-looking statements contained in this announcement are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as the Company’s strategic and operational plans, contain forward-looking statements. 360 DigiTech may also make written or oral forward-looking statements in its reports to the U.S. Securities and Exchange Commission ("SEC"), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including the Company’s business outlook, beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, which factors include but not limited to the following: the Company’s growth strategies, the Company’s cooperation with 360 Group, changes in laws, rules and regulatory environments, the recognition of the Company’s brand, market acceptance of the Company’s products and services, trends and developments in the credit-tech industry, governmental policies relating to the credit-tech industry, general economic conditions in China and around the globe, and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks and uncertainties is included in 360 DigiTech's filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and 360 DigiTech does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For more information, please contact:

360 DigiTech
E-mail: ir@360shuke.com

Christensen

In China
Mr. Eric Yuan
Phone: +86-138-0111-0739
E-mail: Eyuan@christensenir.com

In US
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: lbergkamp@christensenir.com

Unaudited Condensed Consolidated Balance Sheets
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
except for number of shares and per share data, or otherwise noted)

 

December 31,

March 31,

March 31,

 

2021

2022

2022

 

RMB

RMB

USD

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

6,116,360

6,176,429

974,308

Restricted cash

2,643,587

2,634,684

415,611

Security deposit prepaid to third-party guarantee companies

874,886

942,749

148,715

Funds receivable from third party payment service providers

153,151

194,462

30,676

Accounts receivable and contract assets, net

3,097,254

3,103,366

489,544

Financial assets receivable, net

3,806,243

3,797,275

599,005

Amounts due from related parties

837,324

907,767

143,197

Loans receivable, net

9,844,481

11,213,633

1,768,907

Prepaid expenses and other assets

383,937

446,632

70,454

Total current assets

27,757,223

29,416,997

4,640,417

Non-current assets:

 

 

 

Accounts receivable and contract assets, net-non current

223,474

231,610

36,536

Financial assets receivable, net-non current

597,965

612,331

96,593

Amounts due from related parties

140,851

97,296

15,348

Loans receivable, net-non current

2,859,349

3,455,822

545,143

Property and equipment, net

24,941

22,992

3,627

Land use rights, net

1,018,908

1,013,728

159,912

Intangible assets

4,961

6,066

957

Deferred tax assets

834,717

920,706

145,238

Other non-current assets

42,606

72,169

11,384

Total non-current assets

5,747,772

6,432,720

1,014,738

TOTAL ASSETS

33,504,995

35,849,717

5,655,155

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

Current liabilities:

 

 

 

Payable to investors of the consolidated trusts-current

2,304,518

2,638,903

416,277

Accrued expenses and other current liabilities

2,258,329

2,233,599

352,342

Amounts due to related parties

214,057

171,675

27,081

Short term loans

397,576

586,461

92,512

Guarantee liabilities-stand ready

4,818,144

4,738,371

747,460

Guarantee liabilities-contingent

3,285,081

3,257,577

513,870

Income tax payable

624,112

697,278

109,993

Other tax payable

241,369

308,535

48,670

Total current liabilities

14,143,186

14,632,399

2,308,205

Non-current liabilities:

 

 

 

Deferred tax liabilities

121,426

146,244

23,069

Payable to investors of the consolidated trusts-noncurrent

4,010,597

4,858,799

766,457

Other long-term liabilities

13,177

32,046

5,055

Total non-current liabilities

4,145,200

5,037,089

794,581

TOTAL LIABILITIES

18,288,386

19,669,488

3,102,786

TOTAL 360 DIGITECH INC EQUITY

15,203,863

16,172,624

2,551,169

Noncontroling interests

12,746

7,605

1,200

TOTAL EQUITY

15,216,609

16,180,229

2,552,369

TOTAL LIABILITIES AND EQUITY

33,504,995

35,849,717

5,655,155

 

 

 

 

Unaudited Condensed Consolidated Statements of Operations
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
except for number of shares and per share data, or otherwise noted)

 

Three months ended March 31,

 

2021

2022

2022

 

RMB

RMB

USD

Credit driven services

2,451,343

 

2,920,630

 

460,717

 

Loan facilitation and servicing fees-capital heavy

724,311

 

561,411

 

88,560

 

Financing income

409,440

 

789,248

 

124,501

 

Revenue from releasing of guarantee liabilities

1,295,427

 

1,549,968

 

244,501

 

Other services fees

22,165

 

20,003

 

3,155

 

Platform services

1,147,866

 

1,399,417

 

220,752

 

Loan facilitation and servicing fees-capital light

993,889

 

1,098,931

 

173,352

 

Referral services fees

126,330

 

247,298

 

39,010

 

Other services fees

27,647

 

53,188

 

8,390

 

Total net revenue

3,599,209

 

4,320,047

 

681,469

 

Facilitation, origination and servicing

477,756

 

614,930

 

97,003

 

Funding costs

79,078

 

103,768

 

16,369

 

Sales and marketing

385,009

 

552,577

 

87,167

 

General and administrative

104,496

 

122,258

 

19,286

 

Provision for loans receivable

134,908

 

491,227

 

77,489

 

Provision for financial assets receivable

45,060

 

60,514

 

9,546

 

Provision for accounts receivable and contract assets

56,433

 

53,608

 

8,456

 

Provision for contingent liabilities

758,676

 

961,896

 

151,735

 

Total operating costs and expenses

2,041,416

 

2,960,778

 

467,051

 

Income from operations

1,557,793

 

1,359,269

 

214,418

 

Interest income, net

36,384

 

24,417

 

3,852

 

Foreign exchange (loss) gain

(7,992

)

4,952

 

781

 

Other income, net

19,114

 

7,048

 

1,112

 

Investment loss

-

 

(4,900

)

(773

)

Income before income tax expense

1,605,299

 

1,390,786

 

219,390

 

Income taxes expense

(258,051

)

(216,429

)

(34,141

)

Net income

1,347,248

 

1,174,357

 

185,249

 

Net loss attributable to noncontrolling interests

193

 

5,141

 

811

 

Net income attributable to ordinary shareholders of the Company

1,347,441

 

1,179,498

 

186,060

 

Net income per ordinary share attributable to ordinary shareholders of 360 DigiTech, Inc.

Basic

4.42

 

3.80

 

0.60

 

Diluted

4.22

 

3.68

 

0.58

 

 

 

 

 

Net income per ADS attributable to ordinary shareholders of 360 DigiTech, Inc.

Basic

8.84

 

7.60

 

1.20

 

Diluted

8.44

 

7.36

 

1.16

 

 

 

 

 

Weighted average shares used in calculating net income per ordinary share

Basic

304,883,875

 

310,597,659

 

310,597,659

 

Diluted

319,419,632

 

320,913,400

 

320,913,400

 

 

 

 

 

 

 

 

Unaudited Condensed Consolidated Statements of Cash Flows
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
except for number of shares and per share data, or otherwise noted)

 

Three months ended March 31,

 

2021

2022

2022

 

RMB

RMB

USD

Net cash provided by operating activities

745,108

 

1,419,597

 

223,935

 

Net cash (used in) investing activities

(52,158

)

(2,441,645

)

(385,159

)

Net cash provided by financing activities

789,292

 

1,077,034

 

169,898

 

Effect of foreign exchange rate changes

(1,436

)

(3,820

)

(603

)

Net increase in cash and cash equivalents

1,480,806

 

51,166

 

8,071

 

Cash, cash equivalents, and restricted cash, beginning of period

6,774,266

 

8,759,947

 

1,381,848

 

Cash, cash equivalents, and restricted cash, end of period

8,255,072

 

8,811,113

 

1,389,919

 

 

 

 

 

 

 

 

In December 2021, the Company acquired 30% equity interest of Shanghai 360 Changfeng Technology Co., Ltd. (“360 Changfeng”). Before the transaction, the Company owns 40% equity interest of 360 Changfeng and accounted for it as equity method investment. As such, it consolidated 360 Changfeng's financial statement into its financial statements after the transaction. The transaction is between entities under common control and has been retrospectively reflected in the consolidated financial statements from the beginning of 2021, but not to prior year as there is no impact. 360 Changfeng's major transaction in 2021 is to purchase the land use right at the amount of RMB 1 billion in the first quarter which is classified as "net cash used in operating activities" reflected in the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2021. The details of the transaction was provided in the Company's press release furnished to the SEC on form 6-K which dated on December 20, 2021.


Unaudited Condensed Consolidated Statements of Comprehensive (Loss)/Income
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
except for number of shares and per share data, or otherwise noted)

 

Three months ended March 31,

 

2021

2022

2022

 

RMB

RMB

USD

Net income

1,347,248

 

1,174,357

 

185,249

 

Other comprehensive income, net of tax of nil:

 

 

 

 

Foreign currency translation adjustment

6,221

 

(6,259

)

(987

)

Other comprehensive income (loss)

6,221

 

(6,259

)

(987

)

Total comprehensive income

1,353,469

 

1,168,098

 

184,262

 

Comprehensive loss attributable to noncontrolling interests

193

 

5,141

 

811

 

Comprehensive income attributable to ordinary shareholders

1,353,662

 

1,173,239

 

185,073

 

 

 

 

 

 

 

 

Unaudited Reconciliations of GAAP and Non-GAAP Results
(Amounts in thousands of Renminbi (“RMB”) and U.S. dollars (“USD”)
except for number of shares and per share data, or otherwise noted)

 

Three months ended December 31,

 

2021

2022

2022

 

RMB

RMB

USD

Reconciliation of Non-GAAP Net Income to Net Income

 

 

 

 

Net income

1,347,248

 

1,174,357

 

185,249

 

Add: Share-based compensation expenses

59,546

 

52,074

 

8,214

 

Non-GAAP net income

1,406,794

 

1,226,431

 

193,463

 

Non-GAAP net income margin

39.1

%

28.4

%

 

 

GAAP net income margin

37.4

%

27.2

%

 

 

 

 

 

 

 

Net income attributable to shareholders of 360 DigiTech, Inc

1,347,441

 

1,179,498

 

186,060

 

Add: Share-based compensation expenses

59,546

 

52,074

 

8,214

 

Non-GAAP net income attributable to shareholders of 360 DigiTech, Inc

1,406,987

 

1,231,572

 

194,274

 

Weighted average ADS used in calculating net income per ordinary share for both GAAP and non-GAAP EPS -diluted

159,709,816

 

160,456,700

 

160,456,700

 

Net income per ADS attributable to ordinary shareholders of 360 DigiTech, Inc. -diluted

8.44

 

7.36

 

1.16

 

Non-GAAP net income per ADS attributable to ordinary shareholders of 360 DigiTech, Inc. -diluted

8.81

 

7.68

 

1.21

 

 

 

 

 

 

Reconciliation of Non-GAAP Income from operations to Income from operations

 

 

 

 

Income from operations

1,557,793

 

1,359,269

 

214,418

 

Add: Share-based compensation expenses

59,546

 

52,074

 

8,214

 

Non-GAAP Income from operations

1,617,339

 

1,411,343

 

222,632

 

Non-GAAP operating margin

44.9

%

32.7

%

 

 

GAAP operating margin

43.3

%

31.5

%

 

 

 

 

 

 

 

 

 


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