EX-99.1 2 a17-27701_1ex99d1.htm EX-99.1

Exhibit 99.1

 

Yintech Reports Third Quarter 2017 Unaudited Financial Results

 

SHANGHAI, China, November 29, 2017 — Yintech Investment Holdings Limited (NASDAQ: YIN) (“Yintech” or the “Company”), a leading provider of investment and trading services for individual customers in China, today announced its unaudited financial results for the quarter ended September 30, 2017.

 

For the third quarter of 2017, Yintech’s customer trading volume was RMB847.0 billion (US$127.3 billion), a 1.4% increase compared to the third quarter of 2016 and a 4.6% decrease compared to the previous quarter. Yintech generated net commissions and fees of RMB337.9 million (US$50.8 million), a 51.8% decrease compared to the third quarter of 2016 and a 35.1% decrease compared to the previous quarter.

 

 

 

For the quarter ended

 

% Change

 

In RMB million, except otherwise specified

 

September
30, 2016

 

June 30,

2017

 

September
30, 2017

 

YoY

 

QoQ

 

Customer trading volume (in RMB billion)

 

835.1

 

888.0

 

847.0

 

1.4

%

(4.6

%)

Revenues

 

747.5

 

569.9

 

388.3

 

(48.0

%)

(31.9

%)

Net commissions and fees

 

700.7

 

520.5

 

337.9

 

(51.8

%)

(35.1

%)

Net income attributable to Yintech

 

242.1

 

85.4

 

68.6

 

(71.7

%)

(19.7

%)

EPS per ADS - diluted (RMB)

 

3.75

 

1.16

 

0.94

 

(74.9

%)

(19.0

%)

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP data

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP net income attributable to Yintech

 

248.9

 

131.8

 

101.0

 

(59.4

%)

(23.3

%)

Non-GAAP EPS per ADS - diluted (RMB)

 

3.86

 

1.79

 

1.38

 

(64.2

%)

(22.9

%)

 

“Our performance during the quarter was solid despite an unusually tepid market environment,” commented Mr. Wenbin Chen, Chairman and CEO of Yintech. “The volatility of spot gold on the Shanghai Gold Exchange over the past two quarters was at its lowest levels since 2005, which negatively impacted trading activity by customers on our platform. Our acquisition of Forthright Securities announced in late September was an important step in our strategy to expand our portfolio of securities services. We are now able to offer a wide range of securities services to our customers, which include overseas securities trading, securities advisory and securities information platform services. We expect our securities services business to grow rapidly in the coming quarters and contribute more meaningfully to our top and bottom lines.”

 

“Excluding contribution from local exchange business, we recorded strong quarter-on-quarter growth in customer trading volume and revenues in the third quarter, which demonstrates our decisiveness and resilience during this period of transition,” commented Mr. Jingbo Wang, CFO of Yintech. “Our joint venture with SINA is progressing smoothly and will start generating revenues in the fourth quarter of 2017. In addition, we will complete the acquisition of Forthright Securities and begin to consolidate its results of operations by the end of 2017.”

 

1



 

Third Quarter 2017 Financial Results

 

Revenues for the quarter were RMB388.3 million (US$58.4 million), a decrease of 48.0% from RMB747.5 million in the same quarter last year and a decrease of 31.9% from RMB569.9 million in the previous quarter. The sequential decrease was mainly due to the decrease in net commissions and fees.

 

Net commissions and fees for the quarter were RMB337.9 million (US$50.8 million), a decrease of 51.8% from RMB700.7 million in the same quarter last year and a decrease of 35.1% from RMB520.5 million in the previous quarter.

 

Net commissions and fees from commodities trading for the quarter were RMB334.7 million (US$50.3 million). Customer trading volume was RMB847.0 billion (US$127.3 billion) during the quarter, an increase of 1.4% from RMB835.1 billion in the same quarter last year and a decrease of 4.6% from the previous quarter.

 

Net commissions and fees from securities services for the quarter were RMB3.2 million (US$0.5 million).

 

Effective fee rate (representing net commissions and fees from commodities trading business as a percentage of customer trading volume) for the quarter was 0.040%, compared with 0.084% in the same quarter last year and 0.058% in the previous quarter.

 

Expenses for the quarter were RMB315.3 million (US$47.4 million), a decrease of 34.1% from RMB478.7 million in the same quarter last year and a decrease of 29.2% from RMB445.3 million in the previous quarter. The sequential decrease was primarily attributable to a reduction in employee compensation and benefits as well as advertising and promotional expenses.

 

Net income for the quarter was RMB66.5 million (US$10.0 million), a decrease of 71.7% from RMB235.2 million in the same quarter last year and a decrease of 24.4% from RMB88.0 million in the previous quarter.

 

Net income attributable to Yintech for the quarter was RMB68.6 million (US$10.3 million), a decrease of 71.7% from RMB242.1 million in the same quarter last year and a decrease of 19.7% from RMB85.4 million in the previous quarter.

 

Diluted earnings per ADS for the quarter were RMB0.94 (US$0.14), compared with diluted earnings per ADS of RMB3.75 in the same quarter last year and diluted earnings per ADS of RMB1.16 in the previous quarter.

 

Non-GAAP net income attributable to Yintech for the quarter was RMB101.0 million (US$15.2 million), a decrease of 59.4% from RMB248.9 million in the same quarter last year and a decrease of 23.3% from RMB131.8 million in the previous quarter.

 

2



 

Non-GAAP diluted earnings per ADS for the quarter were RMB1.38 (US$0.21), compared with non-GAAP diluted earnings per ADS of RMB3.86 in the same quarter last year and non-GAAP diluted earnings per ADS of RMB1.79 in the previous quarter.

 

As of September 30, 2017, the Company had cash of RMB460.5 million (US$69.2 million), compared with RMB1,541.2 million as of December 31, 2016. The decrease was mainly due to the purchase in the net amount of RMB1,311.8 million of available-for-sale investments such as wealth management products since the beginning of 2017 and the 2016 annual dividend distribution of RMB385.1 million (US$55.9 million), which was partially offset by net income of RMB530.6 million for the nine months ended September 30, 2017.

 

As of September 30, 2017, Total shareholders’ equity of Yintech was RMB3,558.3 million (US$534.8 million), compared with RMB3,316.0 million as of December 31, 2016.

 

Business Outlook

 

Based on the information available as of the date of this press release, Yintech provides the following outlook, which reflects the Company’s current and preliminary view and is subject to change:

 

2017 Fourth Quarter Guidance

 

·                  Customer trading volume will be in the range of RMB680 billion to RMB750 billion.

 

·                  Revenues will be in the range of RMB340 million to RMB370 million.

 

Discussion of Non-GAAP Financial Measures

 

In addition to disclosing financial results prepared in accordance with U.S. GAAP, the Company’s earnings release contains non-GAAP financial measures that exclude the effects of all forms of share-based compensation, as well as amortization of intangible assets in relation to the acquisition of Gold Master. The reconciliation of these non-GAAP financial measures to the nearest GAAP measures is set forth in the table captioned “Reconciliation of GAAP to Non-GAAP Results” below.

 

The non-GAAP financial measures disclosed by the Company should not be considered a substitute for financial measures prepared in accordance with U.S. GAAP. The financial results reported in accordance with U.S. GAAP and reconciliation of GAAP to non-GAAP results should be carefully evaluated. The non-GAAP financial measure used by the Company may be prepared differently from, and therefore may not be comparable to, similarly titled measures used by other companies.

 

When evaluating the Company’s operating performance in the periods presented, management reviewed the non-GAAP net income and non-GAAP EPS results reflecting adjustments to exclude the impact of share-based compensation as well as amortization of intangible assets in relation to the acquisition of Gold Master to supplement U.S. GAAP financial data. As such, the Company believes that the presentation of the non-GAAP net income and the diluted non-GAAP income per ADS provides important supplemental information to investors regarding financial and business trends relating to the Company’s financial condition and results of operations in a manner consistent with that used by management. Pursuant to U.S. GAAP, the Company recognized significant amounts of expenses for the restricted shares and share options, as well as amortization of intangible assets in relation to the acquisition of Gold Master in the periods presented. The Company utilized the non-GAAP financial results to make financial results comparable period to period and to better understand its historical business operations.

 

3



 

Currency Conversion

 

This announcement contains translations of certain Renminbi amounts into U.S. dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to U.S. dollars were made at the exchange rate of RMB6.6533 to US$1.00, as set forth in the H.10 statistical release of the Federal Reserve Board on September 29, 2017. No representation is intended to imply that these Renminbi amounts could have been, or could be, converted, realized or settled into U.S. dollar amounts at such rate, or at any other rate.

 

Conference Call Information

 

The Company will host a conference call to discuss the earnings at 8:00 a.m. U.S. Eastern Time on Wednesday, November 29, 2017 (9:00 p.m. Hong Kong Time on the same day).

 

Dial-in numbers for the live conference call are as follows:

 

International

 

+1 412 902 4272

U.S. Toll Free

 

+1 888 346 8982

Mainland China Toll Free

 

400 120 1203

Hong Kong

 

+852 3018 4992

Hong Kong Toll Free

 

800 905 945

Passcode

 

Yintech

 

A telephone replay of the call will be available after the conclusion of the conference call through 11:59 p.m. Hong Kong Time, December 6, 2017.

 

Dial-in numbers for the replay are as follows:

 

International Dial-in

 

+1 412 317 0088

U.S. Toll Free

 

+1 877 344 7529

Passcode

 

10114520

 

A live and archived webcast of the conference call will be available on the Investor Relations section of Yintech’s website at http://ir.yintech.net/.

 

4



 

Safe Harbor Statement

 

All statements other than statements of historical fact contained in this release, including statements regarding future results of the operations of the Company are forward-looking statements, which are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to a number of risks, uncertainties and assumptions that could cause actual results to differ materially. Factors that might cause or contribute to such differences include, but are not limited to: the Company’s ability to effectively acquire and retain its customers; the Company’s diversification of its business among different commodity exchanges; the adjustments in commissions and other fees set by relevant commodity exchanges; the Company’s ability to constantly upgrade its technology platform and software; general market conditions of online spot commodity trading industry and stock market; intense competition among service providers in this industry; the Company’s relatively short operating history; the price of the Company’s ADSs and changing market conditions for its ADSs; acquisition-related risks, including unknown liabilities and integration risks; as well as those risks detailed from time to time under the caption “Risk Factors” and elsewhere in the Company’s Securities and Exchange Commission filings and reports, including in the Company’s annual report on Form 20-F for the year ended December 31, 2016. In addition, the Company operates in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for the management to predict all risks, nor can the Company assess the impact of all factors on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements that the Company may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this release are inherently uncertain and may not occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Accordingly, you should not rely upon forward-looking statements as predictions of future events. The Company does not undertake any obligation to update publicly or revise any forward-looking statements for any reason after the date of this release, nor to conform these statements to actual results, future events, or to changes in the Company’s expectations.

 

About Yintech

 

Yintech (NASDAQ: YIN) is a leading provider of investment and trading services for individual customers in China. Yintech strives to provide best-in-class financial information, investment tools and services to its customers by leveraging financial technology and mobile platforms. Currently, Yintech is focused on the provision of gold and other commodities trading services, securities advisory services, securities information platform services, overseas securities trading services and asset management services.

 

5



 

Operational Highlights

 

 

 

For the three months ended

 

For the nine months ended

 

 

 

September
30, 2016

 

June 30,
2017

 

September
30, 2017

 

September
30, 2016

 

September
30, 2017

 

Customer trading volume (in RMB billion)

 

835.1

 

888.0

 

847.0

 

1,558.8

 

3,124.0

 

 

 

 

 

 

 

 

 

 

 

 

 

Net commissions and fees (in RMB million)

 

 

 

 

 

 

 

 

 

 

 

Commodities trading1

 

700.7

 

516.0

 

334.7

 

1,551.8

 

1,904.1

 

Securities services2

 

 

4.5

 

3.2

 

 

7.7

 

Total

 

700.7

 

520.5

 

337.9

 

1,551.8

 

1,911.8

 

 

 

 

 

 

 

 

 

 

 

 

 

Effective fee rate3

 

0.084

%

0.058

%

0.040

%

0.100

%

0.061

%

 

 

 

 

 

 

 

 

 

 

 

 

Active accounts4

 

40,797

 

57,559

 

37,391

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tradable accounts5

 

122,013

 

142,115

 

151,908

 

 

 

 

 

 


Note

1. Represents net commissions and fees earned from customer trading of spot and futures commodities contracts.

2. Represents net commissions and fees earned by providing securities advisory services and securities information platform services to customers.

3. Represents net commissions and fees from commodities trading business as a percentage of customer trading volume.

4. Refers to a regular customer account that executed at least one trade through us during the period.

5. Refers to a regular customer account that has been activated and has remained tradable as of the end of the given period. Total number of tradable accounts as of or after June 30, 2017 excluded customer accounts on the Guangdong Precious Metals Exchange.

 

6



 

Consolidated Statements of Comprehensive Income

In RMB ’000, except otherwise specified

 

 

 

For the three months ended

 

For the nine months ended

 

 

 

September 30,
2016

 

June 30,
2017

 

September 30,
2017

 

September 30,
2016

 

September 30,
2017

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees, net

 

700,744

 

520,458

 

337,896

 

1,551,773

 

1,911,826

 

Trading gains, net

 

4,943

 

12,963

 

11,966

 

7,569

 

54,561

 

Interest and investment income

 

1,130

 

587

 

861

 

1,727

 

4,016

 

Other revenues

 

40,690

 

35,908

 

37,608

 

96,759

 

92,452

 

 

 

747,507

 

569,916

 

388,331

 

1,657,828

 

2,062,855

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

(186,537

)

(273,935

)

(171,006

)

(454,800

)

(811,668

)

Advertising and promotion

 

(208,480

)

(92,606

)

(60,632

)

(353,997

)

(332,853

)

Information technology and communications

 

(8,360

)

(13,920

)

(12,498

)

(27,936

)

(33,220

)

Occupancy and equipment rental

 

(18,798

)

(31,417

)

(31,211

)

(46,899

)

(92,891

)

Taxes and surcharges

 

(5,427

)

(6,379

)

(4,228

)

(20,473

)

(18,782

)

Intangible assets amortization

 

(5,048

)

(14,155

)

(14,096

)

(5,048

)

(42,389

)

Other expenses

 

(46,040

)

(12,919

)

(21,641

)

(74,916

)

(59,222

)

 

 

(478,690

)

(445,331

)

(315,312

)

(984,069

)

(1,391,025

)

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

268,817

 

124,585

 

73,019

 

673,759

 

671,830

 

Income taxes

 

(33,585

)

(36,592

)

(6,538

)

(85,716

)

(141,239

)

Net income

 

235,232

 

87,993

 

66,481

 

588,043

 

530,591

 

Less: Net income attributable to non-controlling interests

 

(6,836

)

2,587

 

(2,137

)

(4,364

)

(4,706

)

Net income attributable to Yintech

 

242,068

 

85,406

 

68,618

 

592,407

 

535,297

 

Other comprehensive income

 

3,040

 

(8,777

)

7,479

 

22,711

 

(1,446

)

Comprehensive income attributable to Yintech

 

245,108

 

76,629

 

76,097

 

615,118

 

533,851

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per ADS6 (RMB)

 

 

 

 

 

 

 

 

 

 

 

Basic

 

4.02

 

1.20

 

0.96

 

10.70

 

7.51

 

Diluted

 

3.75

 

1.16

 

0.94

 

9.99

 

7.25

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of shares (‘000)6

 

 

 

 

 

 

 

 

 

 

 

Basic

 

1,204,120

 

1,428,721

 

1,428,139

 

1,107,635

 

1,425,230

 

Diluted

 

1,289,933

 

1,475,513

 

1,464,569

 

1,185,461

 

1,477,304

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of shares outstanding at end of period (‘000)6

 

1,365,706

 

1,402,479

 

1,398,224

 

1,365,706

 

1,398,224

 

 


Note:

6. Each ADS represents 20 ordinary shares.

 

7



 

Consolidated Balance Sheets

In RMB ’000, except otherwise specified

 

 

 

December 31, 
2016

 

September 30,
2017

 

Assets

 

 

 

 

 

Cash

 

1,541,241

 

460,455

 

Derivative assets

 

45,569

 

 

Available-for-sale investments

 

218,940

 

1,530,692

 

Deposits with clearing organizations

 

265,807

 

23,142

 

Equipment and leasehold improvements

 

37,594

 

42,004

 

Deferred tax assets

 

59,551

 

31,209

 

Goodwill

 

1,069,603

 

1,080,408

 

Intangible assets

 

417,257

 

447,641

 

Commission receivable

 

109,497

 

167,929

 

Other assets

 

154,822

 

213,575

 

Total assets

 

3,919,881

 

3,997,055

 

 

 

 

 

 

 

Liabilities and shareholders’ equity

 

 

 

 

 

Deferred tax liabilities

 

108,694

 

86,040

 

Income tax payable

 

145,049

 

89,388

 

Accounts payable

 

15,274

 

4,786

 

Accrued employee benefits

 

231,376

 

226,568

 

Other liabilities

 

103,507

 

32,013

 

Total liabilities

 

603,900

 

438,795

 

 

 

 

 

 

 

Equity attributable to Yintech shareholders

 

3,316,666

 

3,536,731

 

Equity attributable to non-controlling interests

 

(685

)

21,529

 

Total shareholders’ equity

 

3,315,981

 

3,558,260

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

3,919,881

 

3,997,055

 

 

8



 

Reconciliation of GAAP to Non-GAAP Results

In RMB ’000, except otherwise specified

 

 

 

For the three months ended

 

For the nine months ended

 

 

 

September
30, 2016

 

June 30,
2017

 

September
30, 2017

 

September
30, 2016

 

September
30, 2017

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to Yintech

 

242,068

 

85,406

 

68,618

 

592,407

 

535,297

 

Add: Share-based compensation

 

3,381

 

36,041

 

22,073

 

22,429

 

63,946

 

Add: Amortization of intangible assets in relation to the acquisition of Gold Master, net of tax effect

 

3,434

 

10,303

 

10,303

 

3,434

 

30,909

 

Non-GAAP net income attributable to Yintech

 

248,883

 

131,750

 

100,994

 

618,270

 

630,152

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP earnings per ADS7 (RMB)

 

 

 

 

 

 

 

 

 

 

 

Basic

 

4.13

 

1.84

 

1.41

 

11.16

 

8.84

 

Diluted

 

3.86

 

1.79

 

1.38

 

10.43

 

8.53

 

 


Note:

7. Each ADS represents 20 ordinary shares.

 

9



 

For investor and media inquiries, please contact:

 

Yintech

 

Investor Relations Department

 

Phone: +86 21 2028 9009 ext 8270

 

E-mail: ir@yintech.cn

 

 

 

Christensen

 

 

 

In China

 

Mr. Christian Arnell

 

Phone: +86-10-5900-1548

 

E-mail: carnell@christensenir.com

 

 

 

In US

 

Ms. Linda Bergkamp

 

Phone: +1-480-614-3004

 

Email: lbergkamp@christensenir.com

 

 

10