EX-99.1 2 d655259dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

PPDAI Group Inc. Reports Third Quarter 2018 Unaudited Financial Results

SHANGHAI, November 20, 2018 /PRNewswire/ – PPDAI Group Inc. (“PPDAI,” “Paipaidai,” or the “Company”) (NYSE: PPDF), a leading online consumer finance marketplace in China, today announced its unaudited financial results for the third quarter ended September 30, 2018.

 

     As of  
     September 30, 2017     June 30, 2018     September 30, 2018  

Cumulative registered users1 (’000)

     57,581       78,144       83,949  

Cumulative number of borrowers2 (’000)

     9,031       12,409       13,440  

Cumulative number of individual investors3

      521,831       613,653       644,376  
  

 

 

    

 

 

    

 

 

  
     For the Three Months Ended     YoY Change  
     September 30, 2017     September 30, 2018  

Number of unique borrowers4 (’000)

      4,525       2,750       -39.2 % 

Loan origination volume5 (RMB, million)

      20,954       14,771       -29.5 % 

Repeat borrowing rate6 (%)

      67.4 %      69.8 %      3.6 % 

Average loan size7 (RMB)

      2,542       3,396       33.6 % 
  

 

 

    

 

 

    

 

 

  

Third Quarter 2018 Financial Highlights

 

  •  

Net profit increased by 20.0% to RMB649.5 million (US$94.6 million) in the third quarter of 2018 from RMB541.4 million in the same period of 2017.

 

  •  

Operating revenues decreased by 11.7% to RMB1,104.3 million (US$160.8 million) in the third quarter of 2018 from RMB1,250.3 million in the same period of 2017.

 

  •  

Loan facilitation service fees decreased by 22.0% to RMB707.7 million (US$103.0 million) in the third quarter of 2018 from RMB906.9 million in the same period of 2017.

 

  •  

Post-facilitation service fees increased by 19.9% to RMB239.9 million (US$34.9 million) in the third quarter of 2018 from RMB200.1 million in the same period of 2017.

 

  •  

Strong liquidity position of RMB3,489.2 million (US$508.0 million) including cash, cash equivalents and short-term investments.

 

  •  

High quality assurance fund coverage ratio of 18.8% for outstanding loan balances that are protected by the fund.

Third Quarter 2018 Operational Highlights

 

  •  

Cumulative registered users1 reached 83.9 million as of September 30, 2018.

 

  •  

Cumulative number of borrowers2 reached 13.4 million as of September 30, 2018.

 

  •  

Cumulative number of individual investors3 reached 644,376 as of September 30, 2018.

 

  •  

Number of unique borrowers4 was 2.75 million for the third quarter of 2018, representing a decrease of 39.2% from the same period of 2017.

  •  

Loan origination volume5 was approximately RMB14.8 billion for the third quarter of 2018, representing a decrease of 29.5% from the same period of 2017.

 

  •  

Average loan tenure8 was 9.0 months for the third quarter of 2018.

 

  •  

Continued progress in providing our range of “technologies as a service” to other third party financial service providers.

 

 

1 

On a cumulative basis, number of users registered on PPDAI platform as of September 30, 2018.

2 

On a cumulative basis, number of borrowers whose loans were funded on or prior to September 30, 2018.

3 

On a cumulative basis, number of individual investors who have made at least one investment in loans on or prior to September 30, 2018.

4 

Represents the total number of borrowers whose loans on PPDAI platform were funded during the period presented.

5 

Represents the loan origination volume generated during the period presented.

6 

Represents percentage of loan volume generated by repeat borrowers who have successfully borrowed on PPDAI platform before.

7 

Represents the average loan size on PPDAI platform during the period presented.

8 

Represents the average loan tenure period on PPDAI platform during the period presented.

Mr. Jun Zhang, the Chairman and a Co-Chief Executive Officer of PPDAI, commented, “We are pleased to report solid financial results for the third quarter of 2018 despite the headwinds faced by the market. While the industry continues to experience significant change and consolidation, our core business remains resilient and we continue to benefit from market share gains.”

Mr. Feng Zhang, a Co-Chief Executive Officer of PPDAI, stated, “With our strategic focus on investing in technology and our brand, we are encouraged with the progress we’ve seen in our “technologies as a service” offering being deployed across a wide range of financial service providers. We are on track to complete the necessary compliance checks and are working closely with regulators. A strengthened regulatory framework, as well as healthy industry consolidation will fuel long-term growth and sustainability. As a leader in our market, PPDAI is well positioned to capture the enormous opportunities in China’s consumer finance market.”

Mr. Simon Ho, the Chief Financial Officer of PPDAI, added, “During the quarter, we maintained healthy profitability with non-GAAP operating margin of 41.9% benefiting from continuous disciplined cost management. We maintained a strong balance sheet with approximately RMB3.5 billion of cash and short-term liquidity. Notably, our quality assurance fund remains sufficiently funded with a total balance of approximately RMB4.1 billion, equivalent to 18.8% of the total outstanding loans protected by the fund. We’re confident in our ability to navigate this dynamic market and capture opportunities to grow our business.”

 

2

Third Quarter 2018 Financial Results

Operating revenues for the third quarter of 2018 decreased by 11.7% to RMB1,104.3 million (US$ 160.8 million) from RMB1,250.3 million in the same period of 2017, primarily due to lower loan origination volume for the quarter. As a result of the adoption of the ASC 606 effective January 1, 2018, revenue is generally recognized earlier in the life of the contract as there is no contingency revenue cap under the new standard. For the three months ended September 30, 2018, the impact of applying the new revenue standard resulted in an increase of approximately RMB136.3 million (US$19.9 million) in revenues.

Loan facilitation service fees decreased by 22.0% to RMB707.7 million (US$103.0 million) for the third quarter of 2018 from RMB906.9 million in the same period of 2017, primarily due to lower loan origination volume in the third quarter of 2018. The average rate of transaction fees charged to borrowers was 7.07% in the period, compared to 6.31% in the second quarter of 2018 and 6.31% in the third quarter of 2017. Loan collection fees of RMB87.1 million (US$12.7 million) have been allocated from other revenue to loan facilitation service fees related to the adoption of ASC 606 effective January 1, 2018.

Post-facilitation service fees increased by 19.9% to RMB239.9 million (US$34.9 million) for the third quarter of 2018 from RMB200.1 million in the same period of 2017, mainly due to the adoption of ASC 606 effective January 1, 2018. Loan collection fees of RMB33.4 million (US$4.9 million) have been allocated from other revenue to post facilitation service fees related to the adoption of ASC 606.

Other revenue decreased by 21.8% to RMB112.1 million (US$16.3 million) for the third quarter of 2018 from RMB143.3 million in the same period of 2017, primarily due to the adoption of ASC 606, effective January 1, 2018, offset by an increase in management fees from investment programs that invest in loans protected by the quality assurance fund.

Net interest income and loan provision losses for the third quarter of 2018 were an expense of RMB20.3 million (US$3.0 million), compared to an expense of RMB3.4 million in the same period of 2017, mainly due to provisions for expected loan losses related to the increased number of investment trusts established during the period for serving institutional investors.

Origination and servicing expenses decreased by 24.0% to RMB226.2 million (US$32.9 million) for the third quarter of 2018 from RMB297.8 million in the same period of 2017, primarily due to the discontinuation in consumption loan products since late 2017.

Sales and marketing expenses decreased by 18.1% to RMB184.5 million (US$26.9 million) for the third quarter of 2018 from RMB225.3 million in the same period of 2017, primarily due to the decline in online customer acquisition expenses and lower loan origination volume in the third quarter.

General and administrative expenses increased by 26.2% to RMB182.7 million (US$26.6 million) for the third quarter of 2018 from RMB144.7 million in the same period of 2017, primarily due to the increase in research and development costs. General and administrative expenses for the period included share-based compensation of RMB8.3 million (US$1.2 million).

Operating income decreased by 15.3% to RMB490.6 million (US$71.4 million) for the third quarter of 2018 from RMB579.0 million in the same period of 2017.

 

3

Non-GAAP adjusted operating income, which excludes share-based compensation expenses before tax and a write-back of provision for expected discretionary payments to investors in investment programs protected by the investor reserve funds, was RMB454.4 million (US$66.2 million) for the third quarter of 2018, representing a decrease of 21.5% from RMB579.0 million in the same period of 2017.

Other income was RMB251.1 million (US$36.6 million) for the third quarter of 2018, compared with RMB120.9 million in the same period of 2017. Other income primarily consisted of (1) a gain of RMB276.6 million (US$40.3 million) from the quality assurance fund which stemmed from the increase in loans facilitated on the Company’s platform that are protected by the quality assurance fund, (2) a loss of RMB6.8 million (US$0.99 million) from the fair value change of financial guarantee derivatives, and (3) a realized loss of RMB28.1 million (US$4.1 million) from financial guarantee derivatives due to the amount of investment programs maturing during the period. The Company re-evaluates the fair value of outstanding financial guarantee derivatives at each balance sheet date to reflect the views of market participants on the expected default rate based on the latest market changes. For the third quarter of 2018, RMB11.5 billion of loans facilitated on the Company’s platform were protected by the quality assurance fund.

Income tax expenses were RMB 92.2 million (US$13.4 million) for the third quarter of 2018, compared with RMB158.5 million in the same period of 2017, primarily due to tax benefits from increased research and development expenses.

Net profit increased by 20.0% to RMB649.5 million (US$94.6 million) for the third quarter of 2018 from RMB541.4 million in the same period of 2017.

Net profit attributable to ordinary shareholders of the Company was RMB649.3 million (US$94.5 million) for the third quarter of 2018, compared with net loss attributable to ordinary shareholders of RMB278.7 million in the same period of 2017 due to accretion of the Company’s Series A, B and C preferred shares in the third quarter of 2017.

As of September 30, 2018, the Company had cash and cash equivalents of RMB1,654.6 million (US$240.9 million) and short-term investments mainly in wealth management products of RMB 1,834.6 million (US$267.1 million).

The total balance of the quality assurance fund, which included restricted cash of RMB2,064.8 million (US$300.6 million) and the quality assurance fund receivable of RMB2,002.5 million (US$291.6 million), was equivalent to 18.8% of the total outstanding loans protected by the quality assurance fund.

 

 

 

4

The following table provides the delinquency rates for all outstanding loans on the Company’s platform as of the respective dates indicated.

 

As of

    15-29 days     30-59 days     60-89 days     90-119
days		     120-149
days		     150-179
days		  

March 31, 2015

      0.79 %      1.75 %      1.10 %      1.01 %      0.87 %      0.67 % 

June 30, 2015

      0.88 %      1.06 %      0.67 %      0.54 %      0.89 %      0.67 % 

September 30, 2015

      0.67 %      0.89 %      0.61 %      0.54 %      0.44 %      0.35 % 

December 31, 2015

      0.80 %      0.93 %      0.51 %      0.49 %      0.39 %      0.32 % 

March 31, 2016

      0.62 %      0.93 %      0.72 %      0.61 %      0.48 %      0.32 % 

June 30, 2016

      0.82 %      1.01 %      0.63 %      0.43 %      0.47 %      0.44 % 

September 30, 2016

      0.83 %      1.11 %      0.80 %      0.63 %      0.49 %      0.39 % 

December 31, 2016

      0.63 %      0.91 %      0.75 %      0.79 %      0.69 %      0.57 % 

March 31, 2017

      0.57 %      0.95 %      0.79 %      0.59 %      0.54 %      0.51 % 

June 30, 2017

      0.86 %      1.11 %      0.79 %      0.51 %      0.55 %      0.52 % 

September 30, 2017

      0.89 %      1.40 %      1.15 %      1.02 %      0.79 %      0.60 % 

December 31, 2017

      2.27 %      2.21 %      1.72 %      1.63 %      1.36 %      1.20 % 

March 31, 2018

      0.87 %      2.11 %      2.43 %      3.83 %      2.29 %      1.89 % 

June 30, 2018

      0.83 %      1.21 %      1.05 %      0.98 %      1.60 %      2.03 % 

September 30, 2018

      1.03 %      1.77 %      1.49 %      1.29 %      1.06 %      1.02 % 

The following chart and table display the historical cumulative 30-day plus past due delinquency rates by loan origination vintage for all continuing loan products facilitated through the Company’s online marketplace.

 

LOGO

 

5

     Month on Book  
Vintage    2nd     3rd     4th     5th     6th     7th     8th     9th     10th     11th     12th  

2015Q1

      1.95 %      2.75 %      3.46 %      3.98 %      4.36 %      4.58 %      4.67 %      4.69 %      4.73 %      4.76 %      4.74 % 

2015Q2

      1.74 %      2.66 %      3.38 %      3.75 %      4.02 %      4.15 %      4.30 %      4.38 %      4.45 %      4.46 %      4.46 % 

2015Q3

      1.46 %      2.13 %      2.70 %      3.15 %      3.47 %      3.68 %      3.77 %      3.85 %      3.93 %      4.01 %      4.02 % 

2015Q4

      1.54 %      2.27 %      2.88 %      3.17 %      3.53 %      3.77 %      3.97 %      4.12 %      4.26 %      4.32 %      4.33 % 

2016Q1

      1.00 %      1.57 %      2.21 %      2.82 %      3.33 %      3.77 %      4.09 %      4.33 %      4.45 %      4.57 %      4.59 % 

2016Q2

      1.75 %      2.49 %      3.21 %      3.77 %      4.17 %      4.39 %      4.59 %      4.76 %      4.88 %      4.94 %      4.96 % 

2016Q3

      1.67 %      2.45 %      2.96 %      3.47 %      3.87 %      4.11 %      4.27 %      4.44 %      4.59 %      4.70 %      4.77 % 

2016Q4

      1.29 %      2.07 %      2.66 %      3.15 %      3.59 %      3.97 %      4.32 %      4.62 %      4.88 %      5.07 %      5.18 % 

2017Q1

      1.20 %      2.01 %      2.68 %      3.32 %      3.87 %      4.33 %      4.68 %      4.98 %      5.33 %      5.61 %      5.80 % 

2017Q2

      1.72 %      2.89 %      3.81 %      4.55 %      5.14 %      5.78 %      6.32 %      6.79 %      7.05 %      7.19 %      7.24 % 

2017Q3

      1.82 %      2.93 %      4.08 %      5.16 %      6.13 %      6.64 %      6.88 %      7.04 %      7.16 %      7.22 %      7.26 % 

2017Q4

      2.51 %      4.12 %      5.16 %      5.68 %      5.97 %      6.18 %      6.29 %      6.39 %       

2018Q1

      1.35 %      2.18 %      2.97 %      3.65 %      4.30 %             

2018Q2

      1.75 %      3.08 %                   

Conference Call

The Company’s management will host an earnings conference call at 8:00 AM U.S. Eastern Time on November 20, 2018 (9:00 PM Beijing/Hong Kong time on November 20, 2018).

Dial-in details for the earnings conference call are as follows:

 

United States (toll free):   1-888-346-8982
International:   1-412-902-4272
Hong Kong (toll free):   800-905-945
Hong Kong:   852-3018-4992
Mainland China:   400-120-1203

Participants should dial-in at least 5 minutes before the scheduled start time and ask to be connected to the call for “PPDAI Group.”

Additionally, a live and archived webcast of the conference call will be available on the Company’s investor relations website at http://ir.ppdai.com.

A replay of the conference call will be accessible approximately one hour after the conclusion of the live call until December 20, 2018, by dialing the following telephone numbers:

 

United States (toll free):    1-877-344-7529
International:    1-412-317-0088
Replay Access Code:    10126150

 

6

About PPDAI Group Inc.

PPDAI is a leading online consumer finance marketplace in China with strong brand recognition. Launched in 2007, the Company is the first online consumer finance marketplace in China connecting borrowers and investors. As a pioneer in China’s online consumer finance marketplace, the Company benefits from both its early-mover advantages and the invaluable data and experience accumulated throughout multiple complete loan lifecycles. The Company’s platform, empowered by its proprietary, cutting-edge technologies, features a highly automated loan transaction process, which enables a superior user experience, as evidenced by the rapid growth of the Company’s user base and loan origination volume. As of September 30, 2018, the Company had over 83 million cumulative registered users.

For more information, please visit http://ir.ppdai.com.

Use of Non-GAAP Financial Measures

We use Non-GAAP operating income, a Non-GAAP financial measure, in evaluating our operating results and for financial and operational decision-making purposes. We believe that adjusted operating income help identify underlying trends in our business by excluding the impact of share-based compensation expenses and expected discretionary measures. We believe that adjusted operating 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.

Non-GAAP adjusted operating income is not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. This Non-GAAP financial measure has limitations as analytical tools, and when assessing our operating performance, cash flows or our liquidity, investors should not consider them in isolation, or as a substitute for net (loss)/income, cash flows provided by operating activities or other consolidated statements of operation and cash flow data prepared in accordance with U.S. GAAP. The Company encourages investors and others to review our financial information in its entirety and not rely on a single financial measure.

For more information on this Non-GAAP financial measure, please see the table captioned “Reconciliations of GAAP and Non-GAAP results” set forth at the end of this press release.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB6.8680 to US$1.00, the rate in effect as of September 28, 2018 as certified for customs purposes by the Federal Reserve Bank of New York.

 

7

Safe Harbor Statement

This press release contains forward-looking statements. These statements constitute “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “target,” “confident” and similar statements. Such statements are based upon management’s current expectations and current market and operating conditions and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the Company’s control. Forward-looking statements involve risks, uncertainties and other factors that could cause actual results to differ materially from those contained in any such statements. Potential risks and uncertainties include, but are not limited to, uncertainties as to the Company’s ability to attract and retain borrowers and investors on its marketplace, its ability to increase volume of loans facilitated through the Company’s marketplace, its ability to introduce new loan products and platform enhancements, its ability to compete effectively, laws, regulations and governmental policies relating to the online consumer finance industry in China, general economic conditions in China, and the Company’s ability to meet the standards necessary to maintain listing of its ADSs on the NYSE, including its ability to cure any non-compliance with the NYSE’s continued listing criteria. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the U.S. Securities and Exchange Commission. All information provided in this press release is as of the date of this press release, and PPDAI does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.

For investor and media inquiries, please contact:

In China:

PPDAI Group Inc.

Jimmy Tan / Sally Huo

Tel: +86 (21) 8030 3200-8601

E-mail: ir@ppdai.com

The Piacente Group, Inc.

Ross Warner

Tel: +86 (10) 5730-6200

E-mail: paipaidai@tpg-ir.com

In the United States:

The Piacente Group, Inc.

Brandi Piacente

Tel: +1-212-481-2050

E-mail: paipaidai@tpg-ir.com    

 

8

PPDAI GROUP INC.

UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS

(All amounts in thousands, except for share data, or otherwise noted)

 

     As of December 31,     As of September 30,  
     2017     2018  
     RMB     RMB     USD  

Assets

       

Cash and cash equivalents

      1,891,131       1,654,559       240,908  

Restricted cash

      2,392,573       3,502,102       509,916  

Short-term investments

      1,958,910       1,834,592       267,122  

Quality assurance fund receivable

      1,152,769       2,002,519       291,572  

Intangible asset

      63,760       68,880       10,029  

Property, equipment and software, net

      108,248       135,935       19,792  

Loans receivable, net of provision for loan losses

      681,794       1,486,149       216,387  

Investments

      12,234       40,148       5,846  

Accounts receivable

      17,773       621,800       90,536  

Deferred tax assets

      128,361       31,600       4,601  

Financial guarantee derivative assets

      —         45,507       6,626  

Due from related party

      —         6,771       986  

Contract asset

      —         105,551       15,369  

Prepaid expenses and other assets

      145,699       321,149       46,760  

Goodwill

      50,411       50,411       7,340  
  

 

 

    

 

 

    

 

 

  

Total assets

      8,603,663       11,907,673       1,733,790  
  

 

 

    

 

 

    

 

 

  

Liabilities and Shareholders’ Equity

 

  

Payable to platform customers

      1,113,966       1,294,034       188,415  

Quality assurance fund payable

      2,062,844       3,431,338       499,612  

Deferred revenue

      265,094       —         —    

Payroll and welfare payable

      156,831       134,651       19,606  

Taxes payable

      257,143       342,026       49,800  

Provision for payment to investor reserve fund investor

      107,660       24,047       3,501  

Short-term borrowing loan

      —         29,950       4,361  

Funds payable to investors of consolidated trusts

      502,641       950,654       138,418  

Contract liability

      —         175,263       25,519  

Due to related party

      11,972       —         —    

Deferred tax liabilities

      15,940       15,940       2,321  

Accrued expenses and other liabilities

      211,614       220,328       32,080  

Financial guarantee derivative liabilities

      215,770       —         —    
  

 

 

    

 

 

    

 

 

  

Total liabilities

      4,921,475       6,618,231       963,633  
  

 

 

    

 

 

    

 

 

  

Commitments and contingencies

       

PPDAI Group Inc. Shareholders’ deficits

       

Ordinary shares

      100       102       15  

Additional paid-in capital

      5,951,044       5,883,639       856,674  

Treasury stock

      —         (243,777 )      (35,494 ) 

Statutory reserves

      55,090       55,090       8,021  

Accumulated other comprehensive income

      14,917       61,997       9,027  

Accumulated deficit

      (2,398,984 )      (527,590 )      (76,819 ) 
  

 

 

    

 

 

    

 

 

  

Total PPDai Group Inc. shareholders’ equity

      3,622,167       5,229,461       761,424  
  

 

 

    

 

 

    

 

 

  

Non-controlling interest

      60,021       59,981       8,733  
  

 

 

    

 

 

    

 

 

  

Total shareholders’ equity

      3,682,188       5,289,442       770,157  
  

 

 

    

 

 

    

 

 

  

Total liabilities and shareholders’ equity

      8,603,663       11,907,673       1,733,790  
  

 

 

    

 

 

    

 

 

  

 

9

PPDAI GROUP INC.

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(All amounts in thousands, except for share data, or otherwise noted)

 

    For the Three Months Ended September 30,     For the Nine Months Ended September 30,  
    2017     2018     2017     2018  
    RMB     RMB     USD     RMB     RMB     USD  

Operating revenues:

            

Loan facilitation service fees

     906,914       707,738       103,049       2,223,050       2,081,807       303,117  

Post-facilitation service fees

     200,093       239,880       34,927       441,669       672,910       97,978  

Other revenue

     143,312       112,092       16,321       319,007       269,113       39,184  

Change in expected discretionary payment to IRF investors

     —         44,572       6,490       —         44,572       6,490  

Total operating revenues

     1,250,319       1,104,282       160,787       2,983,726       3,068,402       446,769  

Net interest income and loan provision losses

     (3,415 )      (20,315 )      (2,958 )      (1,966 )      19,138       2,787  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net revenues

     1,246,904       1,083,967       157,829       2,981,760       3,087,540       449,556  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Operating expenses:

            

Origination and servicing expenses-related party

     (19,974 )      (25,863 )      (3,766 )      (55,528 )      (78,753 )      (11,467 ) 

Origination and servicing expenses

     (277,844 )      (200,364 )      (29,174 )      (622,717 )      (629,223 )      (91,617 ) 

Sales and marketing expenses

     (225,334 )      (184,481 )      (26,861 )      (549,691 )      (529,853 )      (77,148 ) 

General and administrative expenses

     (144,725 )      (182,652 )      (26,595 )      (338,295 )      (489,686 )      (71,300 ) 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total operating expenses

     (667,877 )      (593,360 )      (86,396 )      (1,566,231 )      (1,727,515 )      (251,532 ) 

Other income (expenses)

            

Gain from quality assurance fund

     131,296       276,593       40,273       277,735       487,425       70,970  

Realized gain (loss) from financial guarantee derivatives

     42,359       (28,108 )      (4,093 )      141,998       (175,215 )      (25,512 ) 

Fair value change of financial guarantee derivatives

     (67,379 )      (6,796 )      (990 )      77,368       261,277       38,043  

Other income, net

     14,615       9,395       1,368       26,193       106,171       15,459  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Profit before income tax expense

     699,918       741,691       107,991       1,938,823       2,039,683       296,984  

Income tax expenses

     (158,545 )      (92,189 )      (13,423 )      (348,850 )      (344,823 )      (50,207 ) 
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net profit

     541,373       649,502       94,568       1,589,973       1,694,860       246,777  

Net profit (loss) attributable to non-controlling interest shareholders

     —         207       30       —         (40 )      (6 ) 

Net profit attributable to PPDai Group Inc.

     541,373       649,295       94,538       1,589,973       1,694,900       246,783  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Accretion on Series A convertible redeemable preferred shares to redemption value

     (315,366 )      —         —         (935,392 )      —         —    

Accretion on Series B convertible redeemable preferred shares to redemption value

     (238,876 )      —         —         (663,022 )      —         —    

Accretion on Series C convertible redeemable preferred shares to redemption value

     (265,869 )      —         —         (678,183 )      —         —    
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net profit (loss) attributable to ordinary shareholders

     (278,738 )      649,295       94,538       (686,624 )      1,694,900       246,783  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Net profit attributable to PPDai Group Inc.

     541,373       649,295       94,538       1,048,600       1,694,900       246,783  

Foreign currency translation adjustment, net of nil tax

     60,890       36,625       5,333       110,031       47,080       6,855  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total comprehensive income attributable to PPDAIGroup Inc.

     602,263       685,920       99,871       1,158,631       1,741,980       253,638  
 

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Weighted average number of ordinary shares used in computing net income/(loss) per share

            

Basic

     665,000,000       1,483,389,904       1,483,389,904       665,000,000       1,502,800,121       1,502,800,121  

Diluted

     665,000,000       1,571,175,958       1,571,175,958       665,000,000       1,611,816,214       1,611,816,214  

Income (loss) per share -Basic

     (0.4192 )      0.4377       0.0637       (1.0325 )      1.1278       0.1642  

Income (loss) per ADS-Basic

     (2.0958 )      2.1886       0.3187       (5.1626 )      5.6391       0.8211  

Income (loss) per share -Diluted

     (0.4192 )      0.4133       0.0602       (1.0325 )      1.0515       0.1531  

Income (loss) per ADS-Diluted

     (2.0958 )      2.0663       0.3009       (5.1626 )      5.2577       0.7655  

 

10

PPDAI GROUP INC.

UNAUDITED Reconciliation of GAAP And Non-GAAP Results

(All amounts in thousands, except for share data, or otherwise noted)

 

     For the Three Months Ended September 30,     For the Nine Months Ended September 30,  
     2017     2018     2017     2018  
     RMB     RMB     USD     RMB     RMB     USD  

Net Revenues

      1,246,904       1,083,967       157,829       2,981,760       3,087,540       449,556  

Less: total operating expenses

      (667,877 )      (593,360 )      (86,396 )      (1,566,231 )      (1,727,515 )      (251,532 ) 

Operating Income

      579,027       490,607       71,433       1,415,529       1,360,025       198,024  

Less: Change in expected discretionary payment to IRF investors

      —         (44,572 )      (6,490 )      —         (44,572 )      (6,490 ) 

Add: share-based compensation expenses

      —         8,321       1,212       —         40,764       5,935  

Non-GAAP adjusted operating income

      579,027       454,356       66,155       1,415,529       1,356,217       197,469  

 

11

PPDAI GROUP INC.

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(All amounts in thousands, except share data, or otherwise noted)

 

     Three Months Ended September 30     Nine Months Ended September 30,  
     2017     2018     2017     2018  
     RMB     RMB     USD     RMB     RMB     USD  

Net cash provided by operating activities

      1,547,622       1,126,389       164,004       3,437,624       1,366,683       198,993  

Net cash used in investing activities

      (1,496,161 )      (1,117,253 )      (162,675 )      (1,574,624 )      (627,835 )      (91,414 ) 

Net cash provided by financing activities

      463,352       263,482       38,363       431,352       89,256       12,995  

Effect of exchange rate changes on cash and cash equivalents

      (269 )      36,993       5,388       (557 )      44,853       6,531  

Net increase in cash, cash equivalent and restricted cash

      514,544       309,611       45,080       2,293,795       872,957       127,105  

Cash, cash equivalent and restricted cash at beginning of period

      2,986,816       4,847,050       705,744       1,207,565       4,283,704       623,719  

Cash, cash equivalent and restricted cash at end of period

      3,501,360       5,156,661       750,824       3,501,360       5,156,661       750,824  

 

12