Cango Inc (NYSE:CANG) Q3 2020 Earnings Conference Call - Final Transcript
Nov 23, 2020 • 08:00 pm ET
Good morning and good evening, everyone. Welcome to Cango Inc.'s Third Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. This call is also being broadcast live on the company's IR website.
Joining us today are Mr. Jiayuan Lin, Chief Executive Officer, and Mr. Michael Zhang, Chief Financial Officer of the company. Following management's prepared remarks, we will conduct a Q&A session.
Before we begin, I refer you to the Safe Harbor Statement in the company's earnings release, which also applies to the conference call today as management will make forward-looking statements.
With that, I am now turning the call over to Mr. Jiayuan Lin, CEO of Cango. Please go ahead, sir.
[Foreign Speech] Hello, everyone, and welcome to Cango's third quarter 2020 earnings call.
[Foreign Speech] In the second half of this year, China's auto market has regained momentum with gradual recovery in the lower-tier cities. With steady progress across our business, we are pleased to see a significant rebound in both our financial and operational performance. Total revenue in the third quarter was approximately RMB435 million, outperforming the high-end of our guidance range by approximately 32%. In particular, our aftermarket facilitation revenue grew to RMB68.9 million, accounting for nearly 15.8% of total. Our car trading transaction business also contributed considerable revenue in this quarter, reaching RMB70.4 million. Operating income sustained its growth momentum from the previous quarter and came in at approximately RMB135 million, mainly attributable to our effective cost control initiatives. Finally, our net income of this quarter was close to RMB1.8 billion, mainly attributable to the significant investment gains from the auto.
[Foreign Speech] Our deep and wide coverage of dealership network, continuous upgrades and innovations of products and services are the main drivers for our sustained growth. We are committed to building an integrated platform that serves all parties in the automotive value chain while offering safe, professional, and efficient auto transaction related products and services to our customers. By implementing our key growth strategy and successfully expanding our core and new businesses, we are witnessing increasing demand for our products and services, which is leading to improved operating efficiency and gains in market share.
[Foreign Speech] Let's start with our core auto loan facilitation business. In the third quarter, we facilitated RMB7.5 billion financing transactions, up 30% from the same period of last year, marking the first period of year-on-year growth since the pandemic outbreak. As of September the 30th, 2020, the total outstanding balance of financing transactions the company facilitated reached RMB38.9 billion.
[Foreign Speech] In terms of dealership network, with our proactive expansion in 4S stores and introduction of new products, the number of new dealers is growing again. By the end of this quarter, we have had a total of 46,248 registered dealers nationwide, maintaining our leading position in auto financing with the most extensive coverage of dealers for new cars in China.
[Foreign Speech] More importantly, after optimizing the efficiency of our lower-tier dealership network