360 Finance Inc (NASDAQ:QFIN) Q2 2020 Earnings Conference Call - Final Transcript

Aug 24, 2020 • 08:00 am ET

Previous

360 Finance Inc (NASDAQ:QFIN) Q2 2020 Earnings Conference Call - Final Transcript

Share
Close

Loading Event

Loading Transcript

Presentation
Operator
Operator

Good day ladies and gentlemen, welcome to the 360 Finance Second Quarter 2020 Earnings Conference Call. Please also note, today's event is being recorded.

At this time, I would like to turn the conference call over to Ms. Mandy Dole [Phonetic], IR Director [Phonetic]. Please go ahead. Mandy.

Executive
Mandy Dole

Thank you, Shane. Hello, everyone, and welcome to our second quarter 2020 earnings conference call. Our results were issued earlier today on the IR website. Joining me today on the call are Mr. Wu Haisheng, our CEO, Director; Mr. Alex Xu, our CFO; and Mr. Zheng Yan, our CRO.

Before we begin prepared remarks, I would like to remind you of the company's Safe Harbor statements. Except for historical information, the material discussed here may contain forward-looking statements. These statements are based on our current plans, estimates and projections, therefore you should not place undue reliance on them. Forward-looking statements involve inherent risks and uncertainties. We caution that a number of important factors could cause actual results to differ materially from those contained in forward-looking statements. For more information about potential risks and uncertainties, please refer to the company's filings with the SEC.

Also this call include discussion of certain non-GAAP matters. Please refer to our earnings release for a reconciliation of the non-GAAP measures to the most directly comparable GAAP ones.

Plus, unless otherwise stated, all figures mentioned are in RMB.

I will now turn the call over to our CEO, Mr. Wu Haisheng.

Executive
Haisheng Wu

Thank you, Mandy.

[Foreign Speech]

Hello, everyone. I'm very proud to report strong financial and operating results for the second quarter. While the macro environment remain challenging, we still set a number of records in key operational metrics. Total loan origination reached RMB58.9 billion during the quarter, up 21.8% year-on-year. Outstanding loan balance increased to RMB78.5 billion from RMB74.1 billion a quarter ago. For the second quarter, total revenue reached RMB3.34 billion and non-GAAP net income reached RMB942 million. This is the most outstanding quarterly results since our IPO.

[Foreign Speech]

Solid performance under the still uncertain macro backdrop further demonstrate the effectiveness of our prudent operational strategy as well as the resilience of our customer base and our risk management system. We believe we have built a structural advantage over our peers, which enables us to successfully navigate through previous market uncertainties such as the P2P crackdown, the regulatory changes, and the pandemic. In each of those cases, we further strengthened our leadership position. With the macro environment economy recovers, we see continued improvement in our operational metrics and we feel confident in our future prospects.

[Foreign Speech]

Our take rate for the quarter improved noticeably, driven by our continued efforts to boost operational efficiency and to refine our risk management system funding structure and the customer acquisition channels. Average pricing during the quarter was 27.2% on IRR basis, which is equivalent of 15% to 16% on the APR basis. Day one delinquency decreased to 6.2% at the end of Q2. This was even better than the