EX-99.1 2 tm2118440d1_ex99-1.htm EXHIBIT 99.1

Exhibit 99.1

 

Hywin Holdings Announces Unaudited Financial Results for the Third Quarter of Fiscal Year 2021 (Ended March 31, 2021)

 

SHANGHAI, China, June 7, 2021 (GLOBE NEWSWIRE) -- Hywin Holdings Ltd. ("Hywin Wealth", “Hywin”, or the "Company", NASDAQ: HYW), a leading wealth management service provider in China, today announced its unaudited financial results for the third quarter of fiscal year 2021 (ended March 31, 2021).

 

Third Quarter Fiscal 2021 Highlights

 

·Number of clients1 increased by 13.5% to 124,043 as of March 31, 2021 from 109,277 as of March 31, 2020.

 

·Number of active clients2 increased by 24.7% to 29,064 from 23,302 in the same period of 2020.

 

·Aggregate transaction value of wealth management products distributed on the Company’s platform increased by 22.5% to RMB21.66 billion from RMB17.67 billion in the same period of 2020.

 

oTransaction value of wealth management products per relationship manager increased by 32.4% to RMB13.67 million from RMB10.33 million in the same period of 2020.

 

·Net revenues increased by 46.5% to RMB462.80 million (US$71.41 million) from RMB315.88 million in the same period of 2020.

 

oNet revenues per relationship manager increased by 58.3% to RMB292,173 from RMB184,618 in the same period of 2020.

 

·Net income increased by 97.6% to RMB61.87 million (US$9.55 million) from RMB31.31 million in the same period of 2020.

 

·Basic and Diluted earnings per American Depositary Share ("ADS") were RMB2.46 (US$0.38), compared to RMB1.25 in the same period of 2020.

 

 

1 Clients are those who had conducted at least one transaction with the Company.

2 Active clients are those who purchased products distributed by the Company during the specified period or those who maintained as holders of the Company’s products within the given period.

 

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Ms. Wang Dian, Chief Executive Officer and Director of Hywin Holdings Ltd., commented, “In this quarter, we maintained robust growth in our client numbers and business volumes. This powered year-over-year increases of 22.5%, 46.5% and 97.6% in our wealth management product transaction value, net revenues, and net income, respectively. These achievements attest to our effectiveness in monetizing client relationships through segmented propositions and continued discovery of client needs, whilst unlocking efficiency gains through our technology and our transition into a nimble organization. Our relationship managers continued to increase their productivity, with net revenues per relationship manager increasing by 58.3% from the same period of 2020. This was accomplished by our investment in training, systematic cross-selling, and a gradual move from cash-based to equity-based incentives, which encourages an entrepreneurial pursuit of long-term success.”

 

Mr. Zhou Huichuan, Chief Financial Officer of Hywin Holdings Ltd., stated, “During this quarter, our strong net income growth was reinforced by our disciplined cost control. We also continued to execute our IBM-assisted digital transformation program, which further improved our operating efficiency. Looking forward, we will continue to leverage technology to optimize our cost structure and further improve our client services to augment sustained growth.”

 

Third Quarter Fiscal 2021 Financial Results

 

Net Revenues

 

Total net revenues in the quarter ended March 31, 2021 increased by 46.5% to RMB462.80 million (US$71.41 million) from RMB315.88 million in the same period of 2020.

 

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·Net revenues from wealth management services in the quarter ended March 31, 2021 increased by 49.9% to RMB425.50 million (US$65.65 million) from RMB283.91 million in the same period of 2020, mostly due to expanded volumes in privately-raised products and the resultant increase in blended margins.

 

·Net revenues from insurance brokerage services in the quarter ended March 31, 2021 decreased by 14.7% to RMB25.77 million (US$3.98 million) from RMB30.20 million in the same period of 2020, as travel restrictions related to the pandemic remained in place.

 

·Net revenues from asset management services in the quarter ended March 31, 2021 increased by 265.5% to RMB5.33 million (US$0.82 million) from RMB1.46 million in the same period of 2020, driven by growing client interest in offshore funds and discretionary mandates managed by the Company.

 

·Net revenues from other services in the quarter ended March 31, 2021 were RMB6.20 million (US$0.96 million), mostly attributed to the Company’s technology consulting services and other value-added services.

 

Operating Cost and Expenses

 

Total operating cost and expenses in the quarter ended March 31, 2021 increased by 35.8% to RM370.98 million (US$57.24 million) from RMB273.23 million in the same period of 2020, in line with the net revenue growth.

 

·Cost of compensation and benefits in the quarter ended March 31, 2021 increased by 37.5% to RMB231.26 million (US$35.68 million) from RMB168.15 million in the same period of 2020, due to increased average business volume per relationship manager.

 

·Sales and marketing expenses in the quarter ended March 31, 2021 increased by 21.7% to RMB75.94 million (US$11.72 million) from RMB62.41 million in the same period of 2020, due to increased marketing and sales activities.

 

·General and administrative expenses in the quarter ended March 31, 2021 increased by 19.4% to RMB50.97 million (US$7.87 million) from RMB42.68 million in the same period of 2020, due to increased administrative personnel expenses in line with the expanded business scale.

 

·Other costs in the quarter ended March 31, 2021 were RMB 12.81 million (US$1.98 million), mainly due to scheduled cost recognition related to our ESOP.

 

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Income from Operations

 

As a result of the foregoing, income from operations in the quarter ended March 31, 2021 increased by 115.3% to RMB91.82 million (US$14.17 million) from RMB42.65 million in the same period of 2020.

 

Net Income

 

Net income in the quarter ended March 31, 2021 increased by 97.6% to RMB61.87 million (US$9.55 million) from RMB31.31 million in the same period of 2020.

 

Earnings per ADS

 

Basic and diluted earnings per ADS in the quarter ended March 31, 2021 were both RMB2.46 (US$0.38), compared to RMB1.25 in the same period of 2020. Each ADS represents two of the Company’s ordinary shares.

 

Balance Sheet

 

As of March 31, 2021, the Company had RMB404.14 million (US$61.50 million) of cash and cash equivalents and restricted cash, compared to RMB188.39 million as of June 30, 2020.

 

Business Outlook

 

For the quarter ended June 30, 2021, the Company expects its net revenues to continue to increase to be between RMB480 million and RMB510 million. This forecast only reflects the Company’s current and preliminary views on the market and operational conditions, which are subject to change.

 

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Recent Developments

 

On May 13, 2021, Hywin won the “The Top 5 Most Influential Wealth Managers in China 2020” award from CVINFO, a renowned publication for China’s private equity and venture capital industry, as a recognition of Hywin’s contribution in connecting leading alternative asset managers with high-quality limited partners such as high-net-worth individuals and institutional investors.

 

On May 15, 2021, Hywin entered into a collaboration agreement with WIND Info, a leading financial and market information provider in China, pursuant to which WIND Info will publish reports produced by Hywin Research Institute. This is a recognition of Hywin’s thought leadership on macroeconomics and investment management in China.

 

Conference Call Information

 

The Company’s management team will hold a Direct Event conference call on Monday, June 7, 2021, at 8:00 A.M. Eastern Time (8:00 P.M. Beijing Time on the same day) to discuss the financial results. Details for the conference call are as follows:

 

Event Title: Hywin Holdings Third Quarter Fiscal 2021 Earnings Conference Call
   
Conference ID: 9388996
   
Registration Link: http://apac.directeventreg.com/registration/event/9388996

 

All participants must use the link provided above to complete the online registration process in advance of the conference call. Upon registering, each participant will receive a set of participant dial-in numbers, the Direct Event passcode, and a unique access PIN, which can be used to join the conference call.

 

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A replay of the conference call will be accessible through June 15, 2021, by dialing the following numbers:

 

International: +612-8199-0299
   
United States Toll Free: +1-855-452-5696
   
Mainland China Toll Free: 400-632-2162
   
Hong Kong, China Toll Free: 800-963-117
   
Access Code: 9388996

 

A live and archived webcast of the conference call will also be available at the Company’s investor relations website at ir.hywinwealth.com.

 

Exchange Rate

 

This press release contains translations of certain RMB amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from RMB to U.S. dollars in this press release were made at a rate of RMB6.57133 to US$1.00 for figures on the balance sheet as of March 31, 2021, RMB6.48134 to US$1.00 for figures on the income statement for the three months ended March 31, 2021, and RMB6.67384 to US$1.00 for figures on the income statement for the nine months ended March 31, 2021.

 

About Hywin Holdings Ltd.

 

Hywin (NASDAQ: HYW) is the third largest independent wealth management service provider in China, with a 7.5% market share in terms of 2019 transaction value, according to China Insights Consultancy. The Company’s primary services are wealth management, insurance brokerage, and asset management. Wealth management is currently the Company’s largest business segment, in which its onshore and offshore solution platform serves clients across generations. For more information, please visit https://ir.hywinwealth.com/

 

 

3 China Foreign Exchange Trade System USD/RMB mid-point rate on March 31, 2021.

4 An appropriately weighted average exchange rate for the reporting period.

 

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Safe Harbor Statement

 

This press release contains statements that may constitute “forward-looking” statements pursuant to the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “anticipate,” “estimate,” “plan,” “project,” “forecast,” “outlook,” “potential,” “continue,” “ongoing,” “expect,” “aim,” “believe,” “intend,” “may,” “should,” “will,” “is/are likely to,” “could” and similar statements. Statements that are not historical facts, including statements about the Company's beliefs, plans, and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. Further information regarding these and other risks is included in the Company's filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

 

Investor Contact:

 

Hywin Holdings Ltd.

 

Jiawei Shen

 

Email: ir@chyjr.com

 

ICR, Inc.

 

Robin Yang

 

Phone: +1 212-537-5797

 

Email: HywinIR@icrinc.com

 

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Media contact:

 

ICR, Inc.

 

Ker Zheng

 

Phone: +86 139-2280-3249

 

Email: HywinPR@icrinc.com

 

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HYWIN HOLDINGS LTD.
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

   

(In thousands, except for per ADS data and percentages)

 

(unaudited)

 

   3/31/2020   3/31/2021   3/31/2021     
   3 months ended,   3 months ended,   3 months ended,     
   RMB'000   RMB'000   USD'000   Change 
Net Revenues                    
-Wealth management   283,912    425,503    65,651    49.9%
-Assets management   1,458    5,329    822    265.5%
-Insurance brokerage   30,200    25,772    3,976    (14.7)%
-Other   311    6,198    957    1,892.9%
Total Revenue   315,881    462,802    71,406    46.5%
                     
Operating Costs and Expenses                    
-Compensation and benefits   168,150    231,258    35,681    37.5%
-Share-based compensation   -    12,812    1,977    N/A 
-Sales and marketing expenses   62,405    75,939    11,716    21.7%
-General and administrative expenses   42,675    50,973    7,865    19.4%
Total Operating Costs and Expenses   273,230    370,982    57,239    35.8%
                     
Income from operations   42,651    91,820    14,167    115.3%
                     
Other income/(expenses)                    
-Interest income, net   106    704    109    564.2%
-Other non-operation expense, net   1,446    (2,206)   (341)   (252.6)%
Total Other Income/(expenses)   1,552    (1,502)   (232)   (196.8)%
                     
Income before tax   44,203    90,318    13,935    104.3%
Income tax expense   12,893    28,450    4,389    120.7%
Net income   31,310    61,868    9,546    97.6%
                     
Other comprehensive Income                    
-Foreign currency translation Loss/(gain)   2,360    616    95    (73.9)%
Comprehensive Income   28,950    61,252    9,451    111.6%
                     
Profit attributable to shareholders   31,310    61,868    9,546    97.6%
                     
Income per ADS                    
Income per ADS basic and diluted   1.25    2.46    0.38    96.8%

 

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HYWIN HOLDINGS LTD.
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(In thousands, except for per ADS data and percentages)

 

(unaudited)

 

   9 months ended,   9 months ended,   9 months ended,   　 
   3/31/2020   3/31/2021   3/31/2021     
   RMB'000   RMB'000   USD'000   Change 
Net Revenues                    
-Wealth management   858,375    1,248,930    187,139    45.5%
-Assets management   2,807    12,016    1,800    328.1%
-Insurance brokerage   72,179    53,003    7,942    (26.6)%
-Other   311    18,160    2,722    5,739.2%
Total Revenue   933,672    1,332,109    199,603    42.7%
                     
Operating Costs and Expenses                    
-Compensation and benefits   511,919    725,094    108,648    41.6%
-Share-based compensation   (369)   12,812    1,920    (3,572.1)%
-Sales and marketing expenses   182,256    246,727    36,969    35.4%
-General and administrative expenses   127,933    144,717    21,684    13.1%
Total Operating Costs and Expenses   821,739    1,129,350    169,221    37.4%
                     
Income from operations   111,933    202,759    30,382    81.1%
                     
Other income/(expenses)                    
-Interest income, net   279    1,336    200    378.9%
-Other non-operation expense, net   (870)   5,476    821    (729.4)%
Total Other Income/(expenses)   (591)   6,812    1,021    (1,252.6)%
                     
Income before tax   111,342    209,571    31,403    88.2%
Income tax expense   34,613    64,016    9,593    84.9%
Net income   76,729    145,555    21,810    89.7%
                     
Other comprehensive Income                    
-Foreign currency translation Loss/(gain)   3,807    (9,759)   (1,462)   (356.3)%
Comprehensive Income   72,922    155,314    23,272    113.0%
                     
Profit attributable to shareholders   76,729    145,555    21,810    89.7%
                     
Income per ADS                    
Income per ADS basic and diluted   3.07    5.81    0.87    89.3%

 

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HYWIN HOLDINGS LTD.
CONSOLIDATED BALANCE SHEETS  

 

(unaudited)  

 

   6/30/2020   3/31/2021   3/31/2021 
   RMB'000   RMB'000   USD'000 
ASSETS               
Current assets               
Cash and cash equivalents   108,358    310,015    47,177 
Restricted cash   80,027    94,129    14,324 
Accounts receivable, net   403,693    516,617    78,617 
Due from related parties, net   321,772    173,496    26,402 
Deposits, prepayments and other current assets   43,451    58,684    8,931 
Total Current Assets   957,301    1,152,941    175,451 
                
Non-current assets               
Property and equipment, net   34,116    20,078    3,055 
Intangible assets, net   29,423    26,165    3,982 
Long-term prepayments   1,808    4,513    687 
Deferred Tax Asset   2,583    324    49 
Total Non-current Assets   67,930    51,080    7,773 
                
Total Assets   1,025,231    1,204,021    183,224 
                
LIABILITIES AND SHAREHOLDERS’ EQUITY               
Current Liabilities               
Commission payable   84,857    89,616    13,637 
Investors’ deposit   74,262    86,984    13,237 
Income Tax Payable   115,432    111,656    16,991 
Due to related parties   59,254    96,775    14,727 
Other payable and accrued liabilities   168,887    151,315    23,028 
Total Current Liabilities   502,692    536,346    81,620 
                
Non-current liabilities               
Commission payable-non current   18,321    11,850    1,803 
Deferred Tax Liability   3,961    3,806    579 
Total Non-current Liabilities   22,282    15,656    2,382 
                
Total Liabilities   524,974    552,002    84,002 
                
Shareholders' Equity               
Ordinary shares (US$0.0001 par value; authorized 500,000,000 shares; issued and outstanding 50,000,000 shares as of June 30, 2020 and 56,000,000 shares as of March 31, 2021)   34    37    6 
Additional paid-in capital   500,581    497,026    75,636 
Statutory reserves   52,959    52,959    8,059 
Accumulated gain/(loss)   (47,056)   98,499    14,989 
Other comprehensive income/(loss)   (6,261)   3,498    532 
                
Total Shareholders' equity   500,257    652,019    99,222 
                
Total Liabilities and Shareholder's equity   1,025,231    1,204,021    183,224 

  

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