Q3 2023 X Financial Earnings Call
Participants
Victoria Yu
Kan Li; President; X Financial
Frank Fuya Zheng; CFO; X Financial
Presentation
Operator
Hello and welcome to the X Financial third-quarter 2023 earnings conference call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note that this event is being recorded. I would like to turn the conference over to [Victoria Yu]. Please go ahead.
Victoria Yu
Thank you, operator. Hello, everyone, and thank you for joining us today. The company's results were released earlier today and are available on the company's IR website at ir.xiaoyinggroup.com. On the call today from X Financial are Mr. Kan Li, President; and Mr. Frank Fuya Zheng, Chief Financial Officer.
Mr. Li will give a brief overview of the company's business operations and highlights, followed by Mr. Zheng, who will go through the financials. They are all available to answer your questions during the Q&A session. I remind you that this call may contain forward-looking statements under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are based on the 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, which may cause the company's actual results, performance, or achievements to differ materially from those in the forward-looking statements.
Further information regarding these and other risks, uncertainties, and factors is included in the company's filings with the US Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required under the law. It is now my pleasure to introduce Mr. Kan Li. Mr. Li, please go ahead.
Kan Li
Hello, everyone, we are pleased to see that our established strategy continue to deliver strong results in the third quarter. Our loan facilitation and origination amount reached the high end of our previous guidance, and the both our top-line and bottom-line showed a substantial year-over-year improvement. During the quarter, as macroeconomic conditions improve the moderate today and the regulatory environment has stabilized, the personal finance business has returned to normal across the industry, resulting in increased competition. As a result, our [junior] to borrower acquisition costs increased quarter- over-quarter.
Our loan delinquencies fluctuated within our historical low to middle range. During the third quarter, our total loan amount have facilitated and originated increased by 49% year-over-year and a 14% quarter-over-quarter to RMB 29 billion. With the total outstanding loan balance reaching nearly RMB50 billion at the end of September 2023, our delinquency rates for all outstanding loans past due for 31 to 60 days and the 91 to 180 days, were 1.11% and 2.5%, respectively, and at the end of the quarter compared with 0.77% and 2.2%, respectively, a year ago.
We have enhanced our efforts to acquire more quality borrowers, but we expect the delinquency rates to continue to fluctuate for some time. We will maintain sales and asset quality leveraging our cutting-edge risk management system and focusing more on asset quality than on expanding our borrower base. Going forward, we will continue to execute our proven strategy and enhance our ability to drive long-term growth and returns for our shareholders. Now I will turn the call to Frank who will go through our financials.
Frank Fuya Zheng
Thank you, Kan, and hello, everyone. We are very pleased with our solid financial results in third quarter. Total net revenue increased by 56% year-over-year and a 14.5% quarter-over-quarter to RMB1,397 million. Our net income saw a remarkable 64% year-over-year increase to RMB347 million. There was a slight decline in quarter-over-quarter.
This decrease was primarily attributed to the rising cost of our borrowing acquisition and management asset quality risk. We remain dedicated to achieving balanced growth in revenue and earnings in the long-term, which is clearly a key driver of shareholder value. To achieve this goal, we will take a comprehensive consideration of the borrower acquisition cost and the risk control based on a close monitoring of market dynamics, to ensure that we grow both our revenues, scale, and profits in a sustainable manner.
Now, I would like to brief some of the financial performance for Q3. Please note that all numbers stated are in RMB and rounded up. Total net revenue increased by 56% to RMB1,397 million from RMB895 million in the same period 2022, primarily due to an increase in the total loan amount facility, and originally, this quarter, compared with the same period of 2022. Origination and servicing expenses increased by 50% to RMB811 million from the RMB540.5 million in the same period of 2022, primarily due to the increase in borrowing acquisition cost and collection expenses, resulting from the increase in total loan amount of facility and originate this quarter compared with the same period of 2022.
Provisions for the loans receivable was RMB54 million compared with RMB70 million in the same period of 2022, primarily due to an increase in loans receivable held by the company, as a result of the increase in total loan amount that facilitate and originate this quarter compared with the same period of 2022. Income from operations 2023 was RMB435 million compared with RMB300 million in the same period of 2022. Net income was RMB347 million, compared with RMB212 million in the same period of 2022. Non-GAAP adjusted net income was RMB375 million, compared with RMB 231 billion in the same period of 2022.
For further financial information, please refer to the earnings release on our website. Regarding our share repurchase plan, in Q3, we repurchased approximately 396,000 ADS for a total consideration of the USD1.7 million. Since the beginning of 2023, we have repurchased an aggregate of approximately 802,000 ADS for a total consideration of the USD3.3 million. We have approximately USD5.6 million remaining for the potential repurchase under our current plan.
Now, on our business outlook. For Q4 this year, we expect the total loan amount facilitated and originated to the between RMB26.5 billion and RMB28 billion. For fiscal year 2023, we expect a total loan amount facility and originate to be between RMB105.9 billion and RMB107.4 billion. This concludes our prepared remarks and we'd like to open the call to questions. Operator, please? Operator?
Question and Answer Session
Operator
(Operator Instructions) This time, we have no questions. Let's return the call back to Ms. Victoria Yu for closing remarks.
Victoria Yu
Thank you, everyone, for joining us on the call today. If you haven't got a chance to raise your questions, we will be pleased to answer them through follow-up contacts. We look forward to speaking with you again in the near future. Thank you.
Operator
Conference has now concluded. Thank you for attending today's presentation. You may now disconnect.
Victoria Yu
Thank you.
