UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 2022
Commission File Number: 001-34936
Noah Holdings Limited
No. 1687 Changyang Road, Changyang Valley, Building 2
Shanghai 200090, People’s Republic of China
(86) 21 8035 9221
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ¨
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
Noah Holdings Limited | ||
| By: | /s/ Qing Pan | |
| Name: Qing Pan | ||
| Title: Chief Financial Officer | ||
Date: November 21, 2022
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Exhibit Index
| Exhibit No. | Description. | |
| Exhibit 99.1 | Press Release |
3
Exhibit 99.1
NOAH HOLDINGS LIMITED ANNOUNCES UNAUDITED
FINANCIAL RESULTS FOR THE THIRD QUARTER OF 2022
SHANGHAI, November 22, 2022 — 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-GAAP1 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.
1
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 clients2, 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 products3 | 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. |
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. |
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.
2
| 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 securities4 | 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 | % | ||||||||||||||||
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. |
4 The asset distribution/redemption of public securities also includes market appreciation or depreciation.
3
| · | 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. |
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| · | 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. |
5
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.
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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.
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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.
8
Contacts:
Noah Holdings Limited
Sonia Han
Tel: +86-21-8035-8372
ir@noahgroup.com
-- FINANCIAL AND OPERATIONAL TABLES FOLLOW --
9
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 | |||||||||
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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, | ||||||||||||||
| 2021 | 2022 | 2022 | Change | |||||||||||||
| RMB'000 | RMB'000 | USD'000 | ||||||||||||||
| Revenues: | ||||||||||||||||
| 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.
11
Noah Holdings Limited
Condensed Comprehensive Income Statements
(unaudited)
| Three months ended | ||||||||||||||||
| September 30, | September 30, | September 30, | ||||||||||||||
| 2021 | 2022 | 2022 | Change | |||||||||||||
| 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 | % | |||||||||||
12
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 | )% | ||||||||
13
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 | (1467 | ) | (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 | |||||||||||
14
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 | |||||||||||
15
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 | ||||||||||||
16
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, | |||||||||||
| 2021 | 2022 | Change | ||||||||||
| 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 | )% | ||||||||
17