Yiren Digital Ltd. · NYSE:YRD
Yiren Digital — Yirendai — Q3 2016 Earnings Presentation
36 slides from Yiren Digital's earnings presentation, Nov 16, 2016
Slide 1: Q3 2016 Earnings Conference Call
Q3 2016 Earnings Conference Call November 16, 2016
Slide 2: Safe Harbor Statement
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Safe Harbor Statement This material contains forward-looking statements. These statements constitute “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Pri
Slide 3: Our Mission
Our Mission Offering borrowers in China easy access to unsecured credit and investors an attractive investment opportunity, by connecting them directly through our online marketplace 3
Slide 4: Yirendai At a Glance
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Yirendai At a Glance Our founders started offline P2P platforms CreditEase in 2006, and created our online-dedicated business, Yirendai, in 2012 9.56 A leading online consumer finance marketplace connecting borrowers and investors Targeting prime
Slide 5: Online Marketplace Connecting Borrowers with Investors
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Online Marketplace Connecting Borrowers with Investors Individual Borrowers Investors Prime borrowers: credit card Monthly Payment Mass affluent investors holders with salary income Pilot project for Internet-savvy and more institutional investor
Slide 6: Addressing China's Consumer Finance Needs
Addressing China’s Consumer Finance Needs WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Traditional Yirendai Banking Solution Focus on Enterprise Huge Unmet Consumer Lending Finance Opportunity Market Offline Branch Offices Innovative Online Consumer Long Application Time Finance Marketplace
Slide 7: Capital Efficient Marketplace Model
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Capital Efficient Marketplace Model No Regulatory Capital Adequacy or Liquidity No Co-Investing Requirements Matched Assets and No Deposits Liabilities 77
Slide 8: Investment Highlights
www. yirendai.com Investment Highlights
Slide 9: Key Investment Highlights
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Key Investment Highlights 1 Huge Market Opportunity 2 A Leading Online Consumer Finance Marketplace 3 Extensive Data Set and Credit Decisioning Capabilities 4 $$ Expanding Borrower Universe and Investor Base 5 Synergistic Relationship with Credit
Slide 10: Huge Unsecured Consumer Finance Market
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 1 Huge Unsecured Consumer Finance Market (1) Unsecured Consumer Finance Market in China (1) Immediately addressable market: (By outstanding loan balance, RMB Billion) prime borrowers with unmet unsecured credit needs 12,330 • RMB 4.4 trillion in
Slide 11: Multiple Drivers of Growth
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 1 Multiple Drivers of Growth Rising GDP (2015 GDP per Capita, US$‘000) + More Consumption (2015 Consumption as % of GDP) + More Financing of Consumption (2015 Consumption Loan Balance(1) as a % of Consumption) 55.8 78.4% 86.1% 54.4% 51.6% 7.9 Chi
Slide 12: A Leading Online Consumer Finance Marketplace
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 2 A Leading Online Consumer Finance Marketplace RMB RMB 92,479 171,460 25.7 Billion 17.0 Billion Cumulative Loan Remaining Principal of New Borrowers New Investors Facilitations (1) Performing Loans (2) in Q3 2016 in Q3 2016 (1) From inception in
Slide 13: Extensive Data Set and Credit Decisioning Capabilities
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 3 Extensive Data Set and Credit Decisioning Capabilities Proprietary Yirendai Score Mobile Carrier Data A Proprietary Data Analysis Platform • Developed in Risk Grade Pricing PBOC conjunction with B Credit Bank Statements FICO Report • Adapted to
Slide 14: Our Borrowers
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 4 Our Borrowers No. of Borrowers Loan Origination Volume (RMB billion) Offline Online Offline Online 92,479 5.62 4.54 40.5% 68,882 59.0% 3.45 40.4% 3.30 50,542 48,072 58.1% 34.1% 2.55 34.4% 36,493 2.08 34,568 53.1% 55.2% 32.4% 27,581 1.62 27.7% 4
Slide 15: Synergistic Relationship with CreditEase
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 5 Synergistic Relationship with CreditEase Current model suitable for nascent Chinese unsecured consumer finance market Receive borrower referrals Leverage CreditEase’s loan Utilize CreditEase’s from CreditEase’s sales data to help advance collec
Slide 16: Financial Highlights
www. yirendai.com Financial Highlights
Slide 17: Financial Highlights
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Financial Highlights 1 Marketplace Model 2 Disciplined Growth of Loan Facilitations 3 Sophisticated Risk Pricing Product Portfolio 4 Robust Growth and Profitability 5 Proven Credit Performance 6 Business Outlook 17 17
Slide 18: Marketplace Model
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 1 Marketplace Model Principal + Interest Borrowers Investors Transaction Fees Service Fees Loans 1 2 3 Transaction Fees from Borrowers Service Fees from Investors Other Revenue Charged to borrowers for loan Monthly management fee charged Includes
Slide 19: Disciplined Growth of Loan Facilitations
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 2 Disciplined Growth of Loan Facilitations (RMB Million) 6,000 5,617 5,000 4,539 4,000 3,447 3,302 3,000 2,551 2,084 2,000 1,621 1,121 1,000 686 252 170 0 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 19 19
Slide 20: Q3 2016 Loan Facilitation Breakdown
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 3 Q3 2016 Loan Facilitation Breakdown % Q3 2016 Loan Facilitation Volume Average Transaction Fee Rate (1) A Excellent 7.0% 5.6% Credit B Very Good 4.7% 17.3% Credit C Good 8.9% 24.8% Credit D Fair 79.4% 27.6% Credit (1) The transaction fee rate i
Slide 21: Net Revenue Growth
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 4 Net Revenue Growth Annual Quarterly (RMB Million) (RMB Million) 900.0 876.7 1,400.0 1,313.6 800.0 733.8 1,200.0 700.0 1,000.0 600.0 556.4 500.0 800.0 451.6 400.0 370.7 600.0 306.2 300.0 400.0 200.0 185.2 196.5 115.6 200.0 100.0 49.8 12.7 18.5 0
Slide 22: Adjusted EBITDA
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 4 Adjusted EBITDA Annual Quarterly (RMB Million) (RMB Million) （13.5） 30.7 (176.9) (178.3) (22.7) 34.7 20.2 36.4 34.3 28.0 37.1 36.1 25.2 420.0 402.7 280.0 265.0 360.0 240.0 220.7 206.6 300.0 200.0 240.0 160.0 127.2 126.5 180.0 120.0 111.6 120.0
Slide 23: Net Income
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 4 Net Income Annual Quarterly (RMB Million) (RMB Million) (14.1) 21.0 (178.4) (179.5) (23.4) 34.4 14.9 26.1 22.8 18.4 23.7 35.5 39.3 300.0 344.3 275.3 260.6 250.0 250.0 200.0 200.0 150.0 150.0 131.7 100.0 84.4 83.3 100.0 80.0 50.0 39.7 50.0 27.6
Slide 24: Proven Credit Performance (Pre-2015 Loans)
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 5 Proven Credit Performance Cumulative M3+ Net Charge Off Rates (1) (2) Loans Facilitated Before 2015 (Guarantee Model) (3) 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 3
Slide 25: Proven Credit Performance (Loans Since 2015)
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 5 Proven Credit Performance Cumulative M3+ Net Charge Off Rates (1) (2) Loans Facilitated Since 2015 (Risk Reserve Model) (3) 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 (Months) 2015Q1 2015
Slide 26: Business Outlook
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx 6 Business Outlook Total loans facilitated in the range of RMB 19,750 million to RMB 20,000 million Total net revenue in the range of RMB 3,080 million to RMB 3,120 Full Year 2016 (1) million Adjusted EBITDA (non-GAAP) in the range of RMB 910 mil
Slide 27: Appendix
www. yirendai.com Appendix
Slide 28: Income Statement
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Income Statement Unaudited Condensed Consolidated Statement of Operations (in thousands, except for share, per share and per ADS data, and percentages) For the Three Months Ended For the Nine Months Ended September June 30, September September Se
Slide 29: Income Statement
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Income Statement Unaudited Condensed Consolidated Statement of Operations (in thousands, except for share, per share and per ADS data, and percentages) For the Three Months Ended For the Nine Months Ended September June 30, September September Se
Slide 30: Cash Flow Data
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Cash Flow Data Unaudited Condensed Consolidated Cash Flow Data (in thousands, except for share, per share and per ADS data, and percentages) For the Three Months Ended For the Nine Months Ended September June 30, September September September Sep
Slide 31: Balance Sheet
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Balance Sheet Unaudited Condensed Balance Sheet (in thousands, except for share, per share and per ADS data, and percentages) For the Three Months Ended For the Nine Months Ended September June 30, September September September September Septembe
Slide 32: Operating Highlights
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Operating Highlights Operating Highlights (in thousands, except for number of borrowers, number of investors and percentages) For the Three Months Ended For the Nine Months Ended September June 30, September Septembe September September September
Slide 33: Reconciliation of GAAP to Non-GAAP Measures
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Reconciliation of GAAP to Non-GAAP Measures Reconciliation of GAAP to Non-GAAP Measures (in thousands) For the Three Months Ended For the Nine Months Ended September June 30, September September September September September 30, 2015 2016 30, 201
Slide 34: Delinquency Rates
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Delinquency Rates Delinquency Rates Delinquent for 15-29 days 30-59 days 60-89 days All Loans December 31, 2013 0.2% 0.4% 0.3% December 31, 2014 0.3% 0.2% 0.2% December 31, 2015 0.4% 0.5% 0.4% March 31, 2016 0.5% 0.8% 0.5% June 30, 2016 0.5% 0.7%
Slide 35: Net Charge-off Rates
WARDED2014\7. Analyst Presentation\Cruise_AP_v31.pptx Net Charge-off Rates Net Charge-Off Rate Loan Amount of loans Accumulated M3+ Net issued facilitated during the Charge-Off as of September Total Net Charge-Off Rate period Pricing grade period 30, 2016 as of September 30, 2016 (in RMB thousands)
Slide 36: A Leading Online Consumer Finance Marketplace in China
A Leading Online Consumer Finance Marketplace in China 36