Noah Holdings Limited Announces Unaudited Financial Results For The Third Quarter Of 2022

Nov 21, 2022

SHANGHAI, Nov. 21, 2022 /PRNewswire/ -- Noah Holdings Limited ("Noah" or the "Company") (NYSE: NOAH and HKEX: 6686), a leading and pioneer wealth management service provider in China offering comprehensive one-stop advisory services on global investment and asset allocation primarily for high net worth investors, today announced its unaudited financial results for the third quarter of 2022.

THIRD QUARTER 2022 FINANCIAL HIGHLIGHTS

  • Net revenues for the third quarter of 2022 were RMB684.5 million (US$96.2 million), a 24.7% decrease from the corresponding period in 2021, mainly due to decreases in one-time commissions and performance-based income. Net revenues decreased by 7.3% compared with the second quarter of 2022, mainly due to a decrease in sales of insurance products and partially offset by increases in recurring service fees and other service fees.

(RMB millions,

except percentages)

Q3 2021

   

Q3 2022

   

YoY Change

Wealth management

653.6

   

466.0

   

(28.7 %)

Asset management

241.3

   

200.3

   

(17.0 %)

Other businesses

14.0

   

18.2

   

30.1 %

Total net revenues

908.9

   

684.5

   

(24.7 %)

  • Income from operations for the third quarter of 2022 was RMB231.8 million (US$32.6 million), a 1.3% increase from the corresponding period in 2021, due to our tighter expense control policy; income from operations decreased by 28.3% compared with the second quarter of 2022, due to a 7.3% decrease in net revenue and a 9.1% increase in operating costs and expenses as less expenses were incurred in the second quarter of 2022 due to the unprecedented COVID lockdown in Shanghai.

(RMB millions,

except percentages)

Q3 2021

   

Q3 2022

   

YoY Change

Wealth management

143.1

   

133.2

   

(6.9 %)

Asset management

117.2

   

117.7

   

0.6 %

Other businesses

(31.4)

   

(19.1)

   

(39.2 %)

Total income from operations

228.9

   

231.8

   

1.3 %

  • Net income attributable to Noah shareholders for the third quarter of 2022 was RMB182.4 million (US$25.6 million), a 33.2% decrease from the corresponding period in 2021, and a 47.7% decrease from the second quarter of 2022, due to losses in our investments and investments in affiliates amid market volatilities.
  • Non-GAAP[1] net income attributable to Noah shareholders for the third quarter of 2022 was RMB190.9 million (US$26.8 million), a 32.8% decrease from the corresponding period in 2021, and a 46.2% decrease from the second quarter of 2022.

[1] Noah's Non-GAAP financial measures are its corresponding GAAP financial measures excluding the effects of all forms of share-based compensation, share-based settlement expenses and net of relevant tax impact, if any. See "Reconciliation of GAAP to Non-GAAP Results" at the end of this press release.

THIRD QUARTER 2022 OPERATIONAL UPDATES

Wealth Management Business

We offer investment products and provide value-added services to high net worth investors in China and overseas for our wealth management business. Noah primarily distributes private equity, private secondary, mutual funds and other products denominated in RMB and other currencies.

  • Total number of registered clients as of September 30, 2022 was 433,250, a 6.6% increase from September 30, 2021, and a 3.5% increase from June 30, 2022.
  • Total number of active clients[2], who transacted with us during the third quarter of 2022 was 22,641, a 6.5% increase from the third quarter of 2021, and a 76.0% increase from the second quarter of 2022.
  • Aggregate value of investment products distributed during the third quarter of 2022 was RMB18.0 billion (US$2.5 billion), a 25.3% decrease from the third quarter of 2021, and a 7.0% decrease from the second quarter of 2022, mainly due to fewer private secondary products distributed and partially offset by an increase in the distribution of mutual fund products.
 

Three months ended September 30,

 

2021

 

2022

Product type

(RMB in billions, except percentages)

Mutual fund products

8.9

 

37.2 %

 

11.7

 

64.8 %

Private secondary products

10.6

 

43.8 %

 

3.3

 

18.5 %

Private equity products

3.8

 

15.8 %

 

2.5

 

13.9 %

Other products[3]

0.8

 

3.2 %

 

0.5

 

2.8 %

All products

24.1

 

100.0 %

 

18.0

 

100.0 %

  • Coverage network in mainland China covered 76 cities as of September 30, 2022, compared with 81 cities as of September 30, 2021 and 79 cities as of June 30, 2022, which was in line with our strategic adjustments after our thorough internal evaluation of each geographic location.
  • Number of relationship managers was 1,257 as of September 30, 2022, a 4.9% decrease from September 30, 2021, and a 0.2% increase from June 30, 2022.

[2] "Active clients" for a given period refers to registered high net worth investors who purchase investment products distributed or receive services provided by us during that given period.

[3] "Other products" refers to other investment products, which includes insurance products, multi-strategies products and others.

Asset Management Business

Our asset management business is conducted through Gopher Asset Management Co., Ltd. ("Gopher Asset Management"), a leading multi-asset manager in China with overseas offices in Hong Kong and the United States. Gopher Asset Management develops and manages assets ranging from private equity, real estate, public securities to multi-strategies investments denominated in RMB and other currencies.

  • Total assets under management as of September 30, 2022 were RMB156.2 billion (US$22.0 billion), a 0.5% increase from June 30, 2022 and a 0.1% increase from September 30, 2021, mainly due to a continuing increase in private equity investments.

Investment type

As of 
June 30
2022

 


Growth

 


Distribution/ 
Redemption

 

As of
September 30
2022

 

(RMB billions, except percentages)

Private equity

132.0

 

84.9 %

 

1.0

 

0.2

 

132.8

 

85.0 %

Public securities[4]

10.7

 

6.9 %

 

0.1

 

0.6

 

10.2

 

6.5 %

Real estate

6.2

 

4.1 %

 

0.6

 

0.1

 

6.7

 

4.3 %

Multi-strategies

5.1

 

3.2 %

 

-

 

-

 

5.1

 

3.3 %

Others

1.4

 

0.9 %

 

-

 

-

 

1.4

 

0.9 %

All Investments

155.4

 

100.0 %

 

1.7

 

0.9

 

156.2

 

100.0 %

 

[4] The asset distribution/redemption of public securities also includes market appreciation or depreciation.

Other Businesses

Our other businesses segment mainly provides more comprehensive services and investment products to our clients.

Ms. Jingbo Wang, co-founder and CEO of Noah, said, "I am happy to report that we have received the acknowledgement from the Hong Kong Stock Exchange regarding our application of a voluntary conversion to dual-primary listing in Hong Kong, and we hope to complete the conversion before the end of this year. In the third quarter of 2022, the market remained challenging and volatile as we resumed our onsite client activities, and as a result, general and administration expenses increased quarter-on-quarter as expected, which led to the decrease in our non-GAAP net income both quarter-on-quarter and year-on-year. The transaction value of private secondary products grew 38.9% quarter-on-quarter, representing a recovery from the last quarter, while transaction value of mutual funds remained stable. Our total number of active clients grew 6.5% year-on-year and 76.0% quarter-on-quarter respectively. We see continued challenges from China's prolonged COVID-zero policy and partial lockdowns in various cities, coupled with a slower growth of economy, and adjusted to a domestic and international 'dual circulation' business model, aiming to grow and strengthen our international operations in terms of staff, products and clients. Overseas revenue contribution grew from 21.6% in the second quarter of 2022 to 28.3% in the quarter and we hope to deliver further growth from our international businesses."

THIRD QUARTER 2022 FINANCIAL RESULTS

Net Revenues

Net revenues for the third quarter of 2022 were RMB684.5 million (US$96.2 million), a 24.7% decrease from the corresponding period in 2021, primarily attributable to decreased one-time commissions and performance based income, partially offset by increased other service fees.

- Wealth Management Business

  • Net revenues from one-time commissions for the third quarter of 2022 were RMB92.1 million (US$12.9 million), a 52.5% decrease year-on-year, primarily due to decreased transaction value in relation to private secondary products as well as insurance products compared with the third quarter of 2021.
  • Net revenues from recurring service fees for the third quarter of 2022 were RMB306.6 million (US$43.1 million), a 21.6% decrease year-on-year. The decrease was primarily due to the service fees recognized upon liquidation of certain credit products with higher fee rates in the third quarter of 2021.
  • Net revenues from performance-based income for the third quarter of 2022 were RMB18.1 million (US$2.5 million), a 52.1% decrease from the corresponding period of 2021, primarily due to less performance-based income from private secondary products.
  • Net revenues from other service fees for the third quarter of 2022 were RMB49.1 million (US$6.9 million), a 59.8% increase from the corresponding period in 2021, primarily due to more value-added services Noah offers to its high net worth clients.

- Asset Management Business

  • Net revenues from one-time commissions for the third quarter of 2022 was RMB7.8 million (US$1.1 million), a 63.3% decrease year-on-year due to fewer investment products that invest in private equity investments sold compared with the third quarter of 2021.
  • Net revenues from recurring service fees for the third quarter of 2022 were RMB183.0 million (US$25.7million), a 4.1% increase from the corresponding period in 2021, due to an increase in the amount of private equity investments managed by Gopher.
  • Net revenues from performance-based income for the third quarter of 2022 were RMB9.5 million (US$1.3 million), a 78.5% decrease year-on-year, primarily due to a decrease in performance-based income from real estate investments and offshore private equity investments managed by Gopher compared with the third quarter of 2021.

- Other Businesses

  • Net revenues for the third quarter of 2022 were RMB18.2 million (US$2.6 million), compared with RMB14.0 million for the corresponding period in 2021, due to more value added services provided.

Operating Costs and Expenses

Operating costs and expenses for the third quarter of 2022 were RMB452.7 million (US$63.6 million), a 33.4% decrease from the corresponding period in 2021. Operating costs and expenses primarily consisted of compensation and benefits of RMB343.0 million (US$48.2 million), selling expenses of RMB76.0 million (US$10.7 million), general and administrative expenses of RMB57.5 million (US$8.1 million), reversal of credit losses of RMB5.3 million (US$0.7 million) and other operating expenses of RMB25.1 million (US$3.5 million).

  • Operating costs and expenses for the wealth management business for the third quarter of 2022 were RMB332.8 million (US$46.8 million), a 34.8% decrease from the corresponding period in 2021, primarily due to a decrease in compensation and benefits in line with decreased transaction value and selling expenses as well as general administrative expenses due to our cost control measures implemented.
  • Operating costs and expenses for the asset management business for the third quarter of 2022 were RMB82.6 million (US$11.6 million), a 33.5% decrease from the corresponding period in 2021, primarily due to decreased selling and general and administrative expenses due to our cost control measures implemented.
  • Operating costs and expenses for other businesses for the third quarter of 2022 were RMB37.4 million (US$5.3 million), compared with RMB45.4 million from the corresponding period in 2021, due to fewer credit losses recorded.

Operating Margin

Operating margin for the third quarter of 2022 was 33.9%, increased from 25.2% for the corresponding period in 2021.

  • Operating margin for the wealth management business for the third quarter of 2022 was 28.6%, compared with 21.9% for the corresponding period in 2021, due to fewer expenses incurred due to our cost control measures implemented.
  • Operating margin for the asset management business for the third quarter of 2022 was 58.8%, compared with 48.5% for the corresponding period in 2021, due to fewer expenses incurred due to our cost control measures implemented.
  • Loss from operation for other businesses for the third quarter of 2022 was RMB19.1 million (US$2.7 million), compared with an operating loss of RMB31.4 million for the corresponding period in 2021.

Investment Income

Investment loss for the third quarter of 2022 was RMB7.2 million (US$1.0 million), compared with investment income of RMB24.1 million for the corresponding period in 2021 due to several investment funds losses that we directly owned.

Income Tax Expenses

Income tax expenses for the third quarter of 2022 were RMB51.1 million (US$7.2 million), a 14.9% decrease year-on-year, primarily due to less taxable income compared with the third quarter of 2021. 

Income from Equity in Affiliates

Loss from equity in affiliates for the third quarter of 2022 was RMB22.4 million (US$3.2 million), compared with income from equity in affiliates of RMB64.5 million for the corresponding period in 2021, primarily due to the decrease in net income of the funds of funds that we manage and invest in as the general partner or fund manager.

Net Income

- Net Income

  • Net income for the third quarter of 2022 was RMB178.0 million (US$25.0 million), a 34.4% decrease from the corresponding period in 2021.
  • Net margin for the third quarter of 2022 was 26.0%, down from 29.9% for the corresponding period in 2021, due to several investment losses.
  • Net income attributable to Noah shareholders for the third quarter of 2022 was RMB182.4 million (US$25.6 million), a 33.2% decrease from the corresponding period in 2021.
  • Net margin attributable to Noah shareholders for the third quarter of 2022 was 26.7%, down from 30.1% for the corresponding period in 2021.
  • Net income attributable to Noah shareholders per basic and diluted ADS for the third quarter of 2022 was RMB2.64 (US$0.37) and RMB2.63 (US$0.37), respectively, down from RMB4.06 and RMB4.04 respectively, for the corresponding period in 2021.

- Non-GAAP Net Income Attributable to Noah Shareholders

  • Non-GAAP net income attributable to Noah shareholders for the third quarter of 2022 was RMB190.9 million (US$26.8 million), a 32.8% decrease from the corresponding period in 2021.
  • Non-GAAP net margin attributable to Noah shareholders for the third quarter of 2022 was 27.9%, compared with 31.3% for the corresponding period in 2021.
  • Non-GAAP net income attributable to Noah shareholders per diluted ADS for the third quarter of 2022 was RMB2.76 (US$0.39), down from RMB4.2 for the corresponding period in 2021.

Balance Sheet and Cash Flow

As of September 30, 2022, the Company had RMB4,312.8 million (US$606.3 million) in cash and cash equivalents, compared with RMB3,608.0 million as of June 30, 2022 and RMB2,829.5 million as of September 30, 2021.

Net cash inflow from the Company's operating activities during the third quarter of 2022 was RMB388.5 million (US$54.6 million), primarily due to operating cash inflow generated by net income and collection of accounts receivables and amounts due from related parties.

Net cash inflow from the Company's investing activities during the third quarter of 2022 was RMB23.7 million (US$3.3 million), primarily due to collection of loan receivables.

Net cash inflow from the Company's financing activities was RMB237.3 million (US$33.4 million) in the third quarter of 2022, primarily related to the proceeds from our global offering and secondary listing of Class A ordinary shares on the Main Board of The Stock Exchange of Hong Kong Limited.

UPDATE ON CREDIT FUNDS

On November 1, 2022, the Company provided an update on the status of the legal proceedings related to certain credit funds managed by Shanghai Gopher Asset Management Co., Ltd (the "Shanghai Gopher").

As the Company previously disclosed on June 21, June 29 and July 6, 2022 and August 25, 2020, certain credit funds (the "Camsing Credit Funds") managed by Shanghai Gopher had invested in supply chain account receivables (the "Camsing Accounts Receivables") with respect to the sale of computer, consumer electronics and communication products by affiliates (the "Sellers") of Camsing International Holding Limited (the "Camsing") as underlying investable assets to a buyer (the "Buyer"). Certain companies and individuals in connection with such supply chain account receivables were later suspected to commit fraudulent activities (the "Camsing Incident"). Shanghai Gopher reported such suspected fraudulent activities to relevant PRC governmental authorities, initiated legal proceedings against the Sellers, the Buyer and relevant guarantors, and has been assisting the PRC governmental authorities with their investigations in connection with the Camsing Incident.

On November 1, 2022, the Shanghai No.2 Intermediate People's Court (the "Court") entered an initial judgment on the criminal case of Camsing Incident, pursuant to which the Court convicted the controlling shareholder of the Camsing to life imprisonment for contract fraud, among other crimes, and the treasurer of Camsing to 17 years and six months' imprisonment for contract fraud, among other crimes. Other defendants in the criminal proceeding were respectively sentenced to imprisonment for a definite term for contract fraud. To the Company's knowledge, the controlling shareholder of the Camsing and other defendants in the criminal proceeding have appealed the above initial judgment. Subsequently, this case will be in the process of second instance and heard by the Shanghai High People's Court.

The Company will continue to closely monitor and evaluate any future development of the legal proceedings in connection with the Camsing Incident and provide further updates as appropriate.

2022 OUTLOOK

We expect to see continued challenges from the rate hikes from the Federal Reserve, sporadic lockdowns in China due to its prolonged COVID-zero policy, as well as the volatile public market. Considering the impact of these factors on clients' investment sentiments, the Company revised its estimated non-GAAP net income attributable to Noah shareholders for the full year 2022 from a range of RMB1.45 billion to RMB1.55 billion as previously published, to a range of RMB1.0 billion to RMB1.1 billion. This estimate reflects management's current business outlook and is subject to change.

As previously announced, we have received acknowledgement from the Hong Kong Stock Exchange regarding our application for a voluntary conversion to dual-primary listing in Hong Kong, which is expected to be completed before the end of 2022. To comply with the applicable requirements under the Hong Kong Listing Rules and in line with the general market practice for companies with primary listings in both the United States and Hong Kong, the Company will no longer publish its annual forecast after the aforementioned conversion to a dual-primary listing in Hong Kong.

CONFERENCE CALL

The Company's senior management will host an earnings conference call via Zoom webinar to discuss its Q3 Results and recent business activities. Details of the conference call are as follows:

Zoom webinar details

Conference title

Noah Holdings 3Q22 Earnings Conference Call

Date/Time

 

Monday, November 21, 2022 at 7:00 p.m., U.S. Eastern time

Tuesday, November 22, 2022 at 8:00 a.m., Hong Kong time

Meeting ID:

929 2532 0489

Meeting Passcode:

599978

Dial in

 

- New York:

+1 929 205 6099

- Hong Kong:

+852 5808 6088

- London:

+44 330 088 5830

- Singapore:

+65 3165 1065

A replay will be available on the same day of the conference call until November 29, 2022 at the Company's investor relations website under the "Announcements & Events" section at http://ir.noahgroup.com.

A live and archived webcast of the conference call will be available at the Company's investor relations website under the "Financial Reports" section at http://ir.noahgroup.com.

DISCUSSION OF NON-GAAP MEASURES        

In addition to disclosing financial results prepared in accordance with U.S. GAAP, the Company's earnings release contains non-GAAP financial measures excluding the effects of all forms of share-based compensation, share-based settlement expenses and net of tax impact, if any. See "Reconciliation of GAAP to Non-GAAP Results" at the end of this press release.

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 measures 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 foregoing non-GAAP net income attributable to Noah shareholders and per diluted ADS and non-GAAP net margin attributable to Noah shareholders to supplement U.S. GAAP financial data. As such, the Company's management believes that the presentation of the non-GAAP financial measures provides important supplemental information to investors regarding financial and business trends relating to its results of operations in a manner consistent with that used by management.  

ABOUT NOAH HOLDINGS LIMITED

Noah Holdings Limited (NYSE: NOAH and HKEX:6686) is a leading and pioneer wealth management service provider in China offering comprehensive one-stop advisory services on global investment and asset allocation primarily for high net worth investors. Noah is a Cayman Islands holding company and carries on business in Hong Kong as Noah Holdings Private Wealth and Asset Management Limited. In the first nine months of 2022, Noah distributed RMB52.3 billion (US$7.3 billion) of investment products. Through Gopher Asset Management, Noah had assets under management of RMB156.2 billion (US$22.0 billion) as of September 30, 2022.

Noah's wealth management business primarily distributes private equity, private secondary, mutual fund and other products denominated in RMB and other currencies. Noah's network covers 76 cities in mainland China, as well as offices in Hong Kong, Taiwan, New York, Silicon Valley and Singapore. A total of 1,257 relationship managers provide customized financial solutions for clients through this network, and meet their international investment needs. The Company's wealth management business had 433,250 registered clients as of September 30, 2022. Through Gopher Asset Management, Noah manages private equity, public securities, real estate, multi-strategy and other investments denominated in RMB and other currencies. The Company also provides other services.

For more information, please visit Noah at ir.noahgroup.com.

FOREIGN CURRENCY TRANSLATION

In this announcement, the unaudited financial results for the third quarter of 2022 ended September 30, 2022 are stated in RMB. This announcement contains currency conversions of certain RMB amounts into US$ at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to US$ are made at a rate of RMB7.1135 to US$1.00, the effective noon buying rate for September 30, 2022 as set forth in the H.10 statistical release of the Federal Reserve Board.

SAFE HARBOR STATEMENT

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "confident" and similar statements. Among other things, the outlook for 2022 and quotations from management in this announcement, as well as Noah's strategic and operational plans, contain forward-looking statements. Noah may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in announcements, circulars or other publications made on the website of The Stock Exchange of Hong Kong Limited (the "Hong Kong Stock Exchange"), in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Noah's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause Noah's actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: its goals and strategies; its future business development, financial condition and results of operations; the expected growth of the wealth management and asset management market in China and internationally; its expectations regarding demand for and market acceptance of the products it distributes; investment risks associated with investment products distributed to Noah's investors, including the risk of default by counterparties or loss of value due to market or business conditions or misconduct by counterparties; its expectations regarding keeping and strengthening its relationships with key clients; relevant government policies and regulations relating to its industries; its ability to attract and retain qualified employees; its ability to stay abreast of market trends and technological advances; its plans to invest in research and development to enhance its product choices and service offerings; competition in its industries in China and internationally; general economic and business conditions in China; and its ability to effectively protect its intellectual property rights and not to infringe on the intellectual property rights of others. Further information regarding these and other risks is included in Noah's filings with the U.S. Securities and Exchange Commission and the Hong Kong Stock Exchange. All information provided in this press release and in the attachments is as of the date of this press release, and Noah does not undertake any obligation to update any such information, including forward-looking statements, as a result of new information, future events or otherwise, except as required under the applicable law.

-- FINANCIAL AND OPERATIONAL TABLES FOLLOW --

Noah Holdings Limited 

Condensed Consolidated Balance Sheets

(unaudited)

 

As of

 

June 30,

 

September 30

 

September 30

 

2022

 

2022

 

2022

 

RMB'000

 

RMB'000

 

USD'000

Assets

         
 

Current assets:

         
   

Cash and cash equivalents

3,608,044

 

4,312,827

 

606,288

   

Restricted cash

2,689

 

10,311

 

1,449

   

Short-term investments

85,889

 

98,770

 

13,885

   

Accounts receivable, net

515,361

 

426,900

 

60,013

   

Loans receivable, net

607,586

 

566,933

 

79,698

   

Amounts due from related parties

562,755

 

424,821

 

59,720

   

Other current assets 

210,623

 

184,506

 

25,937

   

Total current assets 

5,592,947

 

6,025,068

 

846,990

 

Long-term investments, net

711,839

 

723,902

 

101,764

 

Investment in affiliates

1,510,503

 

1,516,292

 

213,157

 

Property and equipment, net

2,506,121

 

2,497,558

 

351,101

 

Operating lease right-of-use assets, net

197,934

 

189,906

 

26,697

 

Deferred tax assets

335,845

 

333,522

 

46,886

 

Other non-current assets 

159,859

 

160,059

 

22,501

Total Assets

11,015,048

 

11,446,307

 

1,609,096

Liabilities and Equity

         
 

Current liabilities:

         
   

Accrued payroll and welfare expenses 

618,933

 

543,435

 

76,395

   

Income tax payable

51,317

 

69,214

 

9,730

   

Deferred revenues

64,242

 

81,602

 

11,471

   

Other current liabilities

531,344

 

458,079

 

64,396

   

Contingent liabilities

455,479

 

483,727

 

68,001

 

Total current liabilities

1,721,315

 

1,636,057

 

229,993

 

Operating lease liabilities, non-current

95,995

 

101,110

 

14,214

 

Deferred tax liabilities

232,332

 

231,589

 

32,556

 

Other non-current liabilities

87,243

 

76,330

 

10,730

 

Total Liabilities 

2,136,885

 

2,045,086

 

287,493

 

Equity

8,878,163

 

9,401,221

 

1,321,603

Total Liabilities and Equity

11,015,048

 

11,446,307

 

1,609,096

 

 

Noah Holdings Limited

Condensed Consolidated Income Statements

(In RMB'000, except for ADS data, per ADS data and percentages)

(unaudited)

 

Three months ended 

 

September 30,

 

September 30,

 

September  30,

 

Change

 

2021

 

2022

 

2022

   

Revenues:

RMB'000

 

RMB'000

 

USD'000

   

Revenues from others:

             

One-time commissions

183,733

 

92,551

 

13,011

 

(49.6 %)

Recurring service fees

259,364

 

195,429

 

27,473

 

(24.7 %)

Performance-based income

26,796

 

17,658

 

2,482

 

(34.1 %)

Other service fees

51,690

 

71,290

 

10,022

 

37.9 %

Total revenues from others

521,583

 

376,928

 

52,988

 

(27.7 %)

Revenues from funds Gopher manages:

             

One-time commissions

32,113

 

7,846

 

1,103

 

(75.6 %)

Recurring service fees

309,532

 

296,648

 

41,702

 

(4.2 %)

Performance-based income

55,645

 

10,109

 

1,421

 

(81.8 %)

Total revenues from funds Gopher
     manages

397,290

 

 

314,603

 

 

44,226

 

 

(20.8 %)

Total revenues

918,873

 

691,531

 

97,214

 

(24.7 %)

Less: VAT related surcharges 

(9,958)

 

(7,063)

 

(993)

 

(29.1 %)

Net revenues

908,915

 

684,468

 

96,221

 

(24.7 %)

Operating costs and expenses:

             

Compensation and benefits

             

Relationship managers

(178,589)

 

(108,971)

 

(15,319)

 

(39.0 %)

Others

(281,220)

 

(234,055)

 

(32,903)

 

(16.8 %)

Total compensation and benefits

(459,809)

 

(343,026)

 

(48,222)

 

(25.4 %)

Selling expenses

(114,307)

 

(75,995)

 

(10,683)

 

(33.5 %)

General and administrative expenses

(77,129)

 

(57,511)

 

(8,085)

 

(25.4 %)

(Provision) reversal for credit losses

(6,582)

 

5,274

 

741

 

N.A.

Other operating expenses 

(33,030)

 

(25,084)

 

(3,526)

 

(24.1 %)

Government subsidies 

10,804

 

43,645

 

6,136

 

304.0 %

Total operating costs and expenses 

(680,053)

 

(452,697)

 

(63,639)

 

(33.4 %)

Income from operations 

228,862

 

231,771

 

32,582

 

1.3 %

Other income:

             

Interest income 

16,156

 

16,847

 

2,368

 

4.3 %

Investment income (loss)

24,109

 

(7,233)

 

(1,017)

 

N.A.

Settlement expenses

(1,437)

 

-

 

-

 

N.A.

Other (expenses) income

(824)

 

10,066

 

1,415

 

N.A.

Total other income

38,004

 

19,680

 

2,766

 

(48.2 %)

Income before taxes and income from
     equity in affiliates

266,866

 

251,451

 

35,348

 

(5.8 %)

Income tax expense

(60,045)

 

(51,078)

 

(7,180)

 

(14.9 %)

Income (loss) from equity in affiliates

64,536

 

(22,406)

 

(3,150)

 

N.A.

Net income

271,357

 

177,967

 

25,018

 

(34.4 %)

Less: net loss attributable to non-
     controlling interests

 

(1,843)

 

 

(4,448)

 

 

(625)

 

 

141.3 %

Net income attributable to Noah
     shareholders 

273,200

 

182,415

 

25,643

 

(33.2 %)

               

Income per ADS, basic

4.06

 

2.64

 

0.37

 

(35.0 %)

Income per ADS, diluted

4.04

 

2.63

 

0.37

 

(34.9 %)

 

Margin analysis:

             

Operating margin

25.2 %

 

33.9 %

 

33.9 %

   

Net margin

29.9 %

 

26.0 %

 

26.0 %

   

 

Weighted average ADS equivalent[1]:

             

Basic

67,253,930

 

69,212,818

 

69,212,818

   

Diluted

67,641,457

 

69,255,667

 

69,255,667

   

ADS equivalent outstanding at end of
period

 

60,132,192

 

62,558,122

 

62,558,122

   
               
 

 

[1] Assumes all outstanding ordinary shares are represented by ADSs. Each ordinary share represents
two ADSs.

 

 

 

 

Noah Holdings Limited 

Condensed Comprehensive Income Statements 

(unaudited)

 

Three months ended 

   
 

September 30,

 

September 30,

 

September 30,

 

Change

 

2021

 

2022

 

2022

   
 

RMB'000

 

RMB'000

 

USD'000

   

Net income

271,357

 

177,967

 

25,018

 

(34.4 %)

Other comprehensive income, net of tax:

             

Foreign currency translation adjustments

(32,357)

 

107,640

 

15,132

 

N.A.

Fair value fluctuation of available for sale
     Investment (after tax)

 

109

 

 

-

 

-

 

N.A.

Comprehensive income

239,109

 

285,607

 

40,150

 

19.4 %

Less: Comprehensive loss attributable to
     non-controlling interests

 

(1,845)

 

 

(4,428)

 

(622)

 

140.0 %

Comprehensive income attributable to
     Noah
shareholders

240,954

 

290,035

 

40,772

 

20.4 %

 

 

 Noah Holdings Limited

Supplemental Information 

(unaudited) 

 

As of 

   
 

September 30
2021

 

September 30
2022

 

Change

           

Number of registered clients 

406,420

 

433,250

 

6.6 %

Number of relationship managers 

1,322

 

1,257

 

(4.9 %)

Number of cities in mainland China under
coverage 

 

81

 

76

 

(6.2 %)

           
 

Three months ended 

   
 

September 30,
2021

 

September 30
2022

 

Change

 

(in millions of RMB, except number of active clients and
percentages)

Number of active clients

21,269

 

22,641

 

6.5 %

Transaction value: 

         

Private equity products 

3,793

 

2,487

 

(34.4 %)

Private secondary products

10,545

 

3,326

 

(68.5 %)

Mutual fund products 

8,942

 

11,650

 

30.3 %

Other products

787

 

507

 

(35.6 %)

Total transaction value

24,067

 

17,970

 

(25.3 %)

 

 

Noah Holdings Limited 

Segment Condensed Income Statements 

(unaudited) 

 
 

Three months ended September 30, 2022

 
 

Wealth 
Management
Business

 

Asset 
Management
Business

 

Other 
Businesses

 

Total

 

RMB'000

 

RMB'000

 

RMB'000

 

RMB'000

               

Revenues:

             

Revenues from others

             

One-time commissions

92,551

 

-

 

-

 

92,551

Recurring service fees

195,429

 

-

 

-

 

195,429

Performance-based income

17,658

 

-

 

-

 

17,658

Other service fees

49,368

 

-

 

21,922

 

71,290

Total revenues from others

355,006

 

-

 

21,922

 

376,928

Revenues from funds Gopher
     manages

             

One-time commissions

-

 

7,846

 

-

 

7,846

Recurring service fees

112,636

 

184,012

 

-

 

296,648

Performance-based income

515

 

9,594

 

-

 

10,109

Total revenues from funds Gopher
     manages

 

113,151

 

 

201,452

 

-

 

 

314,603

Total revenues

468,157

 

201,452

 

21,922

 

691,531

Less: VAT related surcharges 

(2,212)

 

(1,139)

 

(3,712)

 

(7,063)

Net revenues

465,945

 

200,313

 

18,210

 

684,468

Operating costs and expenses:

             

Compensation and benefits

             

Relationship managers

(103,275)

 

(5,696)

 

-

 

(108,971)

Others

(165,245)

 

(58,758)

 

(10,052)

 

(234,055)

Total compensation and benefits

(268,520)

 

(64,454)

 

(10,052)

 

(343,026)

Selling expenses

(65,988)

 

(8,796)

 

(1,211)

 

(75,995)

General and administrative
     expenses 

 

(39,345)

 

 

(10,947)

 

 

(7,219)

 

 

(57,511)

Provision (reversal) for credit
     losses

931

 

(14)

 

4,357

 

5,274

Other operating expenses

(1,467)

 

(357)

 

(23,260)

 

(25,084)

Government subsidies 

41,610

 

2,005

 

30

 

43,645

Total operating costs and expenses 

(332,779)

 

(82,563)

 

(37,355)

 

(452,697)

Income (loss) from operations

133,166

 

117,750

 

(19,145)

 

231,771

 

 

Noah Holdings Limited

Segment Condensed Income Statements

 (unaudited)

 

         Three months ended September 30, 2021

 

Wealth
Management

 Business

 

Asset
Management

Business

 

Other
Businesses

 

Total

 

RMB'000

 

RMB'000

 

RMB'000

 

RMB'000

               

Revenues:

             

Revenues from others

             

One-time commissions

183,733

 

-

 

-

 

183,733

Recurring service fees

259,364

 

-

 

-

 

259,364

Performance-based income

26,796

 

-

 

-

 

26,796

Other service fees

30,856

 

-

 

20,834

 

51,690

Total revenues from others

500,749

 

-

 

20,834

 

521,583

Revenues from funds Gopher manages

             

One-time commissions

10,784

 

21,329

 

-

 

32,113

Recurring service fees

133,173

 

176,359

 

-

 

309,532

Performance-based income

11,080

 

44,565

 

-

 

55,645

Total revenues from funds Gopher
     manages
 

155,037

 

242,253

 

-

 

397,290

Total revenues

655,786

 

242,253

 

20,834

 

918,873

Less: VAT related surcharges

(2,215)

 

(899)

 

(6,844)

 

(9,958)

Net revenues

653,571

 

241,354

 

13,990

 

908,915

Operating costs and expenses:

             

Compensation and benefits

             

Relationship managers

(172,469)

 

(6,120)

 

-

 

(178,589)

Others

(179,230)

 

(89,733)

 

(12,257)

 

(281,220)

Total compensation and benefits

(351,699)

 

(95,853)

 

(12,257)

 

(459,809)

Selling expenses

(92,288)

 

(13,584)

 

(8,435)

 

(114,307)

General and administrative
     expenses

 

(57,096)

 

 

(13,669)

 

 

(6,364)

 

 

(77,129)

Provision for credit losses

(3,799)

 

(701)

 

(2,082)

 

(6,582)

Other operating expenses

(16,268)

 

(431)

 

(16,331)

 

(33,030)

Government subsidies

10,674

 

30

 

100

 

10,804

Total operating costs and expenses

(510,476)

 

(124,208)

 

(45,369)

 

(680,053)

Income (loss) from operations

143,095

 

117,146

 

(31,379)

 

228,862

 

 

Noah Holdings Limited

Supplement Revenue Information by Geography

(unaudited)

 
 

Three months ended September 30, 2022

 

Wealth 
Management
Business

 

Asset 
Management
Business

 

Other
Businesses

 

Total

 

RMB'000

 

RMB'000

 

RMB'000

 

RMB'000

               

Revenues:

             

Mainland China

302,088

 

173,771

 

21,922

 

497,781

Hong Kong

125,240

 

6,945

 

-

 

132,185

Others

40,829

 

20,736

 

-

 

61,565

Total revenues

468,157

 

201,452

 

21,922

 

691,531

 
   
 

Three months ended September 30, 2021

 

Wealth 
Management
Business

 

Asset 
Management
Business

 

Other
Businesses

 

Total

 

RMB'000

 

RMB'000

 

RMB'000

 

RMB'000

               

Revenues:

             

Mainland China

482,033

 

165,602

 

20,834

 

668,469

Hong Kong

139,503

 

67,426

 

-

 

206,929

Others

34,250

 

9,225

 

-

 

43,475

Total revenues

655,786

 

242,253

 

20,834

 

918,873

 

 

Noah Holdings Limited

Reconciliation of GAAP to Non-GAAP Results 

(In RMB, except for per ADS data and percentages) 

(unaudited) 

 

Three months ended 

     
 

September
30, 

 

September  

30,

 

Change 

 
 

2021

 

2022

     
 

RMB'000

 

RMB'000

     
             

Net income attributable to Noah shareholders

273,200

 

182,415

 

(33.2 %)

 

Adjustment for share-based compensation

12,423

 

11,148

 

(10.3 %)

 

Add: settlement expense

1,437

 

-

 

N.A.

 

Less: tax effect of adjustments

2,879

 

2,684

 

(6.8 %)

 

Adjusted net income attributable to Noah shareholders
     (non-GAAP)

284,181

 

190,879

 

(32.8 %)

 

Net margin attributable to Noah shareholders

30.1 %

 

26.7 %

     

Non-GAAP net margin attributable to Noah shareholders

31.3 %

 

27.9 %

     
             

Net income attributable to Noah shareholders per ADS,
     diluted

4.04

 

2.63

 

(34.9 %)

 

Non-GAAP net income attributable to Noah shareholders
     per ADS, diluted

 

4.20

 

2.76

 

(34.3 %)

 

 

 

Cision View original content:https://www.prnewswire.com/news-releases/noah-holdings-limited-announces-unaudited-financial-results-for-the-third-quarter-of-2022-301683519.html

SOURCE Noah Holdings Limited

Noah Holdings Limited, Sonia Han, Tel: +86-21-8035-8372, ir@noahgroup.com

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