EX-99.1 2 tm2126362d1_ex99-1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

Hywin Holdings Announces Unaudited Financial Results for the Fourth Quarter and Full Year of Fiscal 2021

 

- Hywin Holdings Announces Record Fourth Quarter Results –

 

- Net Income Grew 95.6% in Fiscal Year 2021 –

 

SHANGHAI, China, August 31, 2021 (GLOBE NEWSWIRE) -- Hywin Holdings Ltd. ("Hywin Wealth," “Hywin,” or the "Company") (NASDAQ: HYW), a leading independent wealth management service provider in China, today announced its unaudited financial results for the fourth quarter and full year of fiscal 2021 ended June 30, 2021.

 

Fourth Quarter Fiscal 2021 Highlights

 

·Number of clients1 increased by 12.5% to 127,317 from 113,146 in the same period of 2020.

 

·Number of active clients2 increased by 17.6% to 29,094 from 24,734 in the same period of 2020.

 

·Aggregate transaction value of wealth management products distributed on the Company’s platform increased by 39.3% to RMB 20.89 billion from RMB 15.00 billion in the same period of 2020.

 

○Transaction value of wealth management products per relationship manager increased by 53.8% to RMB 14.29 million from RMB 9.29 million in the same period of 2020.

 

·Net revenues increased by 43.0% to RMB 502.31 million (US$ 77.78 million) from RMB 351.19 million in the same period of 2020.

 

○Net revenues per relationship manager increased by 57.9% to RMB 343,579 from RMB 217,590 in the same period of 2020.

 

·Net income increased by 111.1% to RMB 62.10 million (US$ 9.62 million) from RMB 29.42 million in the same period of 2020.

 

·Basic earnings per American Depositary Share ("ADS") was RMB 2.22 (US$ 0.34), compared with RMB 1.18 in the same period of 2020. Diluted earnings per ADS was RMB 2.14 (US$ 0.33), compared with RMB 1.18 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.

 

1 

 

 

Full Year Fiscal 2021 Highlights

 

·Number of clients3 increased by 12.5% to 127,317 as of June 30, 2021 from 113,146 as of June 30, 2020.

 

·Number of active clients4 increased by 4.5% to 38,033 from 36,397 in fiscal 2020.

 

·Aggregate transaction value of wealth management products distributed on the Company’s platform increased by 15.0% to RMB 78.78 billion from RMB 68.49 billion in fiscal 2020.

 

○Transaction value of wealth management products per relationship manager increased by 16.1% to RMB 52.38 million from RMB 45.12 million in fiscal 2020.

 

·Net revenues increased by 42.8% to RMB 1,834.42 million (US$ 277.11 million) from RMB 1,284.86 million in fiscal 2020.

 

○Net revenues per relationship manager increased by 44.1% to RMB 1.22 million from RMB 0.85 million in fiscal 2020.

 

·Net income increased by 95.6% to RMB 207.66 million (US$ 31.37 million) from RMB 106.15 million in fiscal 2020.

 

·Basic earnings per American Depositary Share ("ADS") was RMB 8.05 (US$ 1.22), compared with RMB 4.25 in fiscal 2020.

 

·Diluted earnings per ADS was RMB 7.76 (US$ 1.17), compared with RMB 4.25 in fiscal 2020.

 

 

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

4 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.

 

2 

 

 

Ms. Wang Dian, Chief Executive Officer and Director of Hywin, commented, “Our financial and operating results for the fourth quarter and fiscal year 2021 were record high. While we continued to grow our new client base, we also saw strong, recurring transaction demands from our existing users, as evident in our industry-leading 76.7% repeat investment rate from our existing clients. Meanwhile, we continued to diversify our product offerings and are seeing early success in several newer product categories, such as our privately-raised securities products. These efforts, combined with our continuing strategies to expand our geographic footprint, to enhance our technology, and to strengthen our research and advisory capabilities, will drive value creation for our clients and shareholders.”

 

Mr. Lawrence Lok, Chief Financial Officer of Hywin, stated, “During the fourth quarter and fiscal year 2021, we achieved impressive growth while maintaining cost discipline. Productivity per relationship manager increased, whereas our sales and marketing expenses and our general and administrative expenses both declined as a percentage of revenue. As a result, our net income for fiscal year 2021 increased by 95.6% from the prior fiscal year. Looking forward, we will continue our investment, especially in R&D and in training our talents to drive further productivity gains, as we carefully execute our growth strategy.”

 

Fourth Quarter Fiscal 2021 Financial Results

 

Net Revenues

 

Total net revenues in the quarter ended June 30, 2021 increased by 43.0% to RMB 502.31 million (US$77.78 million) from RMB 351.19 million in the same period of 2020.

 

·Net revenues from wealth management services in the quarter ended June 30, 2021 increased by 43.5% to RMB 493.62 million (US$76.43 million) from RMB 343.88 million in the same period of 2020, mostly due to expanded volumes in privately-raised products5.

 

·Net revenues from asset management services in the quarter ended June 30, 2021 increased by 61.4% to RMB 2.93 million (US$0.45 million) from RMB 1.81 million in the same period of 2020, driven by client interest in more diversified products and asset management offerings of the Company.

 

·Net revenues from other services in the quarter ended June 30, 2021 were RMB 5.77 million (US$0.89 million), mostly attributable to the Company’s technology consulting services and other value-added services.

 

 

 

5 The revenues of insurance brokerage services have been absorbed into the wealth management services, reflecting the fact that insurance solutions increasingly form an integral part of the wealth management proposition to clients.

 

3 

 

 

Operating Costs and Expenses

 

Total operating costs and expenses in the quarter ended June 30, 2021 increased by 39.3% to RMB 423.47 million (US$ 65.57 million) from RMB 304.08 million in the same period of 2020, in line with net revenue growth.

 

·Cost of compensation and benefits in the quarter ended June 30, 2021 increased by 41.3% to RMB 277.97 million (US$ 43.04 million) from RMB 196.74 million in the same period of 2020, due to increased average business volumes per relationship manager.

 

·Sales and marketing expenses in the quarter ended June 30, 2021 increased by 25.5% to RMB 80.15 million (US$ 12.41 million) from RMB 63.85 million in the same period of 2020, due to increased marketing and sales activities.

 

·General and administrative expenses in the quarter ended June 30, 2021 increased by 29.3% to RMB 56.21 million (US$ 8.70 million) from RMB 43.49 million in the same period of 2020, due to increased administrative personnel expenses in line with the Company’s expansion.

 

·Other costs in the quarter ended June 30, 2021 were RMB 9.14 million (US$1.41 million), mainly due to scheduled cost recognition related to the Company’s ESOP.

 

Income from Operations

 

As a result of the foregoing, income from operations in the quarter ended June 30, 2021 increased by 67.4% to RMB 78.85 million (US$ 12.21 million) from RMB 47.11 million in the same period of 2020.

 

Net Income

 

Net income in the quarter ended June 30, 2021 increased by 111.1% to RMB 62.10 million (US$ 9.62 million) from RMB 29.42 million in the same period of 2020.

 

4 

 

 

Earnings per ADS

 

Basic earnings per ADS in the quarter ended June 30, 2021 was RMB 2.22 (US$ 0.34), compared with RMB 1.18 in the same period of 2020.

 

Diluted earnings per ADS in the quarter ended June 30, 2021 was RMB 2.14 (US$ 0.33), compared with RMB 1.18 in the same period of 2020.

 

Each ADS represents two of the Company’s ordinary shares.

 

Full Year Fiscal 2021 Financial Results

 

Net Revenues

 

Total net revenues in the full year of fiscal 2021 increased by 42.8% to RMB 1,834.42 million (US$277.11 million) from RMB 1,284.86 million in the full year of fiscal 2020.

 

·Net revenues from wealth management services in the full year of fiscal 2021 increased by 40.9% to RMB 1,795.55 million (US$271.24 million) from RMB 1,274.43 million in the full year of fiscal 2020, mostly due to expanded volumes in privately-raised products and diversified products offerings6.

 

·Net revenues from asset management services in the full year of fiscal 2021 increased by 223.4% to RMB 14.94 million (US$2.26 million) from RMB 4.62 million in the full year of fiscal 2020, driven by growing client interest in offshore funds and discretionary mandates managed by the Company.

 

·Net revenues from other services in the full year of fiscal 2021 were RMB 23.93 million (US$3.62 million), mostly attributable to the Company’s technology consulting services and other value-added services.

 

 

6 Note: The revenues of insurance brokerage services have been absorbed into the wealth management services, reflecting the fact that insurance solutions increasingly form an integral part of the wealth management proposition to clients.

5 

 

 

Operating Costs and Expenses

 

Total operating costs and expenses in the full year of fiscal 2021 increased by 37.9% to RMB 1,552.82 million (US$ 234.57 million) from RMB 1,125.82 million in the full year of fiscal 2020, in line with net revenue growth.

 

·Cost of compensation and benefits in the full year of fiscal 2021 increased by 41.5% to RMB 1,003.06 million (US$ 151.52 million) from RMB 708.65 million in the full year of fiscal 2020, due to increased average business volume per relationship manager.

 

·Sales and marketing expenses in the full year of fiscal 2021 increased by 32.8% to RMB 326.88 million (US$ 49.38 million) from RMB 246.11 million in the full year of fiscal 2020, due to increased marketing and sales activities.

 

·General and administrative expenses in the full year of fiscal 2021 increased by 17.2% to RMB 200.93 million (US$ 30.35 million) from RMB 171.42 million in the full year of fiscal 2020, due to increased administrative personnel expenses in line with the Company’s expansion.

 

·Other costs in the full year of fiscal 2021 were RMB 21.95 million (US$ 3.32 million), mainly due to scheduled cost recognition related to the Company’s ESOP.

 

Income from Operations

 

As a result of the foregoing, income from operations in the full year of fiscal 2021 increased by 77.1% to RMB 281.61 million (US$ 42.54 million) from RMB 159.05 million in the full year of fiscal 2020.

 

Net Income

 

Net income in the full year of fiscal 2021 increased by 95.6% to RMB 207.66 million (US$ 31.37 million) from RMB 106.15 million in the full year of fiscal 2020.

 

Earnings per ADS

 

Basic earnings per ADS in the full year of fiscal 2021 was RMB 8.05 (US$ 1.22), compared with RMB 4.25 in the full year of fiscal 2020.

 

Diluted earnings per ADS in the full year of fiscal 2021 was RMB 7.76 (US$ 1.17), compared with RMB 4.25 in the full year of fiscal 2020.

 

Each ADS represents two of the Company’s ordinary shares.

 

6 

 

 

Balance Sheet

 

As of June 30, 2021, the Company had RMB 705.31 million (US$ 109.18 million) in cash, cash equivalents, and restricted cash, compared with RMB 188.39 million as of June 30, 2020.

 

Recent Developments

 

On 7 July, Hywin’s CEO, Ms Wang Dian, was featured in the “InvestHK Family Office” promotional video as one of the ambassadorial figures for the family office initiative of the Hong Kong SAR Government.

 

On 20 July, Hywin received the Type 1 License (Dealing in Securities) from the Securities and Futures Commission of Hong Kong, complementing our existing Type 4 (Advising on Securities), Type 5 (Advising on Futures Contracts) and Type 9 (Asset Management) Licenses.

 

On 12 August, Hywin appointed Mr. Wai Lok (Lawrence) to the position of Chief Financial Officer, to strengthen our shareholder value-centric business strategy, and broaden our conversations with the international investor community. Prior to joining Hywin, Mr. Lok was a senior investment banker at Citigroup for more than 15 years.

 

Conference Call Information

 

The Company’s management team will hold a Direct Event conference call on August 31, 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 Fourth Quarter and Full Year Fiscal 2021 Earnings Conference Call
  
Conference ID:8225068
  
Registration Link:https://apac.directeventreg.com/der/validateConferenceId.action

 

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.

 

7 

 

 

A replay of the conference call will be accessible through August 31, 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:8225068

 

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 RMB6.46017 to US$1.00 for figures on the balance sheet as of June 30, 2021, RMB6.45838 to US$1.00 for figures on the income statement for the three months ended June 30, 2021, and RMB6.61999 to US$1.00 for figures on the income statement for the twelve months ended June 30, 2021.

 

About Hywin Holdings Ltd.

 

Hywin (NASDAQ: HYW) is a leading independent wealth management service provider in China focused on providing asset allocation advisory services and comprehensive financial products to high-net-worth clients. The Company’s primary services are wealth management, asset management, and other comprehensive financial services. Wealth management is currently the Company’s largest business segment, in which its onshore and offshore solution platforms serve clients across generations. For more information, please visit https://ir.hywinwealth.com.

 

 

 

7 China Foreign Exchange Trade System USD/RMB mid-point rate on June 30, 2021.

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

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

 

8 

 

 

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,” “forecast,” “plan,” “project,” “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.

 

Jingyi Wen

 

Email: ir@chyjr.com

 

 

ICR, LLC

 

Robin Yang

 

Phone: +1 212-537-5797

 

Email: HywinIR@icrinc.com

 

 

Media contact:

 

ICR, LLC

 

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 months
ended,		   3 months
ended,		   3 months
ended,		     
   6/30/2020   6/30/2021   6/30/2021   Change 
   RMB'000   RMB'000   USD'000     
Net Revenues                    
-Wealth management   343,880    493,619    76,432    43.5%
-Assets management   1,813    2,926    453    61.4%
-Other   5,498    5,768    893    4.9%
Total Net Revenues   351,191    502,313    77,778    43.0%
                     
Operating Costs and Expenses                    
-Compensation and benefits   196,735    277,967    43,040    41.3%
-Share-based compensation   -    9,135    1,414    N/A 
-Sales and marketing expenses   63,852    80,152    12,411    25.5%
-General and administrative expenses   43,490    56,212    8,704    29.3%
Total Operating Costs and Expenses   304,077    423,466    65,569    39.3%
                     
Income from operations   47,114    78,847    12,209    67.4%
                     
Other (expenses)/income                    
-Interest income, net   46    201    31    337.0%
-Other non-operation (expenses)/income, net   (1,588)   7,132    1,104    (549.1)%
Total Other (expenses)/income   (1,542)   7,333    1,135    (575.6)%
                     
Income before tax   45,572    86,180    13,344    89.1%
Income tax expense   16,150    24,078    3,728    49.1%
Net income   29,422    62,102    9,616    111.1%
                     
Other comprehensive Income                    
-Foreign currency translation Loss/(gain)   (166)   (783)   (121)   371.7%
Comprehensive Income   29,588    62,885    9,737    112.5%
                     
Profit attributable to shareholders   29,422    62,102    9,616    111.1%
                     
Income per ADS                    
Income per ADS basic   1.18    2.22    0.34    88.1%
Income per ADS diluted   1.18    2.14    0.33    81.4%

 

10

 

 

HYWIN HOLDINGS LTD.
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME 
(In thousands, except for per ADS data and percentages) 
(unaudited) 

 

   12 months ended,   12 months ended,   12 months ended,     
   6/30/2020   6/30/2021   6/30/2021   Change 
   RMB'000   RMB'000   USD'000     
Net Revenues                    
-Wealth management   1,274,434    1,795,552    271,235    40.9%
-Assets management   4,620    14,942    2,257    223.4%
-Other   5,809    23,928    3,615    311.9%
Total Net Revenues   1,284,863    1,834,422    277,107    42.8%
                     
Operating Costs and Expenses                    
-Compensation and benefits   708,654    1,003,061    151,522    41.5%
-Share-based compensation   (369)   21,947    3,315    (6047.7)%
-Sales and marketing expenses   246,108    326,879    49,378    32.8%
-General and administrative expenses   171,423    200,929    30,353    17.2%
Total Operating Costs and Expenses   1,125,816    1,552,816    234,568    37.9%
                     
Income from operations   159,047    281,606    42,539    77.1%
                     
Other(expenses)/ income                    
-Interest income, net   325    1,537    232    372.9%
-Other non-operation (expenses)/income, net   (2,458)   12,608    1,905    (612.9)%
Total Other (expenses)/Income   (2,133)   14,145    2,137    (763.2)%
                     
Income before tax   156,914    295,751    44,676    88.5%
Income tax expense   50,763    88,094    13,307    73.5%
Net income   106,151    207,657    31,369    95.6%
                     
Other comprehensive Income                    
-Foreign currency translation Loss/(gain)   3,641    (10,542)   (1,592)   (389.5)%
Comprehensive Income   102,510    218,199    32,961    112.9%
                     
Profit attributable to shareholders   106,151    207,657    31,369    95.6%
                     
Income per ADS                    
Income per ADS basic   4.25    8.05    1.22    89.4%
Income per ADS diluted   4.25    7.76    1.17    82.6%

 

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HYWIN HOLDINGS LTD.
CONSOLIDATED BALANCE SHEETS		  
 
(unaudited)  

 

   6/30/2020   6/30/2021   6/30/2021 
   RMB'000   RMB'000   USD'000 
ASSETS               
Current assets               
Cash and cash equivalents   108,358    439,287    68,000 
Restricted cash   80,027    266,023    41,179 
Accounts receivable, net   403,693    594,061    91,958 
Due from related parties, net   321,772    126,103    19,520 
Deposits, prepayments and other current assets   43,451    51,540    7,979 
Total Current Assets   957,301    1,477,014    228,636 
                
Non-current assets               
Property and equipment, net   34,116    21,104    3,267 
Intangible assets, net   29,423    24,225    3,750 
Long-term prepayments   1,808    7,427    1,150 
Deferred Tax Asset   2,583    649    100 
Total Non-current Assets   67,930    53,405    8,267 
                
Total Assets   1,025,231    1,530,419    236,903 
                
LIABILITIES AND SHAREHOLDERS’ EQUITY               
Current Liabilities               
Commission payable   84,857    127,194    19,689 
Investors’ deposit   74,262    248,277    38,432 
Income Tax Payable   115,432    116,897    18,095 
Due to related parties   59,254    24,799    3,839 
Other payable and accrued liabilities   168,887    278,697    43,142 
Total Current Liabilities   502,692    795,864    123,197 
                
Non-current liabilities               
Commission payable-non current   18,321    10,080    1,560 
Deferred Tax Liability   3,961    3,548    549 
Total Non-current Liabilities   22,282    13,628    2,109 
                
Total Liabilities   524,974    809,492    125,306 
                
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;  issued and outstanding 56,000,000 shares as of June 30, 2021)

   34    36    6 
Additional paid-in capital   500,581    503,050    77,870 
Statutory reserves   52,959    52,959    8,198 
Accumulated (loss)/gain    (47,056)   160,601    24,860 
Other comprehensive (loss)/income   (6,261)   4,281    663 
                
Total Shareholders' equity   500,257    720,927    111,597 
                
Total Liabilities and Shareholder's equity   1,025,231    1,530,419    236,903 

 

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