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 June 2018

Commission File Number: 001-38245

 

Hexindai Inc.

(Exact name of registrant as specified in its charter)

 


 

13th Floor, Block C, Shimao

No. 92 Jianguo Road

Chaoyang District, Beijing 100020

People’s Republic of China

(Address of principal executive office)

 

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 o

 

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): o

 

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): o

 

 

 



 

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.

 

 

Hexindai Inc.

 

 

 

By:

/s/ Zhang Qisen (Johnson)

 

 

Zhang Qisen (Johnson)

 

 

Chief Financial Officer

 

 

Date: June 15, 2018

 

 

2



 

EXHIBIT INDEX

 

Exhibit No.

 

Description

 

 

 

Exhibit 99.1 

 

Press Release

 

3


Exhibit 99.1

 

Hexindai Reports Unaudited Fourth Quarter and Fiscal Year 2018 Financial Results

 

BEIJING, CHINA, June 15, 2018 — Hexindai Inc. (NASDAQ: HX) (“Hexindai” or the “Company”), a fast-growing consumer lending marketplace in China, today announced its unaudited financial results for the fourth quarter and fiscal year ended March 31, 2018.

 

Throughout the release, each ADS represents one ordinary share. Fiscal year refers to the 12 months ended March 31.

 

Fourth Quarter of Fiscal Year 2018 Operational Highlights

 

·                      Total loan volume facilitated (1) was US$418.4 million (RMB2.7 billion) during the fourth quarter of fiscal year 2018, an increase of 236.7% from the fourth quarter of fiscal year 2017.

·                      Gross billing amount (net of VAT)(2) was US$31.8 million during the fourth quarter of fiscal year 2018, an increase of 231.1% from the fourth quarter of fiscal year 2017.

·                      Gross billing ratio (net of VAT)(3) for credit loans was 7.6% during the fourth quarter of fiscal year 2018, a decrease from 8.1% during the fourth quarter of fiscal year 2017.

·                      Number of borrowers (4) was 33,322 during the fourth quarter of fiscal year 2018, an increase of 285.2% from the fourth quarter of fiscal year 2017.

·                      Number of investors (5) was 62,039 during the fourth quarter of fiscal year 2018, an increase of 103.2% from the fourth quarter of fiscal year 2017.

 

Fourth Quarter of Fiscal Year 2018 Financial Highlights (Unaudited)

 

·                      Net revenue was US$27.6 million during the fourth quarter of fiscal year 2018, an increase of 270.7% from the fourth quarter of fiscal year 2017.

·                      Operating expenses were US$8.4 million during the fourth quarter of fiscal year 2018, an increase of 115.2% from the fourth quarter of fiscal year 2017.

·                      Net income was US$17.0 million during the fourth quarter of fiscal year 2018, an increase of 303.0% from the fourth quarter of fiscal year 2017.

·                      Basic EPS in the fourth quarter of fiscal year 2018 was US$0.36 compared to US$0.10 in fiscal year 2017.

 


(1) Total loan volume facilitated is defined as the total principal amount of loans facilitated on our marketplace during the relevant period.

 

(2)Gross billing amount” is defined as the aggregated loan facilitation fees and loan management fees charged to borrowers before cash incentives, net of value added tax. It differs from the revenue recognized at the time of recognition. For an individual secured loan transaction, the gross billing amount equals the gross accumulative loan management service revenue recognized over the term of the secured loan. For the traditional individual credit loan transaction, as the loan facilitation service fees are charged upfront upon the release of funds to borrowers, the gross billing amount equals the loan facilitation service revenue, while for the newly introduced individual credit loan we launched from third quarter of fiscal year 2018, the service fees are charged each period, the gross billing amount equals the gross accumulative loan management service revenue recognized over the estimated term of the credit loan.

 

(3)Gross billing ratio” is defined as the gross billing amount divided by loan volume facilitated, presented in percentage. It is an operation metric we believe is a more accurate indicator of profitability.

 

(4) Refers to borrowers who recorded successful borrowing activity on our online marketplace during the relevant period.

 

(5) Refers to investors who made loan investments on our online marketplace during the relevant period.

 



 

·                      Diluted EPS in the fourth quarter of fiscal year 2018 was US$0.32 compared to US$0.10 in fiscal year 2017.

·                      Adjusted net income attributable to Hexindai Inc.’s shareholders (Non-GAAP) in the fourth quarter of fiscal year 2018 was US$18.2 million, increased by 329.8% from US$4.2 million in the fourth quarter of fiscal year 2017.

·                      Adjusted EBIT (Non-GAAP) in the fourth quarter of fiscal year 2018 was US$20.4 million, increased by 472.8% from US$3.6 million in the fourth quarter of fiscal year 2017.

 

Fiscal Year Ended March 31, 2018 Operational Highlights

 

·                      Total loan volume facilitated was US$1,257.6 million (RMB8.3 billion) during the fiscal year ended March 31, 2018, an increase of 151.2% from US$493.3 million (RMB3.3 billion) during last fiscal year.

·                      Gross billing amount (net of VAT) was US$118.6 million during the fiscal year ended March 31, 2018, an increase of 320.0% from last fiscal year.

·                      Gross billing ratio (net of VAT) for credit loans was 9.5% during the fiscal year ended March 31, 2018, an increase from 7.6% during last fiscal year.

·                      Number of borrowers was 101,172 during the fiscal year ended March 31, 2018, an increase of 252.0% from last fiscal year.

·                      Number of investors was 137,950 during the fiscal year ended March 31, 2018, an increase of 117.8% from last fiscal year.

·                      Delinquency rates (6). As of March 31, 2018, the delinquency rates for loans that are past due for 15-29 days, 30-59 days and 60-89 days were 0.066%, 0.152% and 0.120%, compared to 0.091%, 0.138% and 0.331%, as of March 31, 2017.

·                      M3+ Net Charge-Off Rates(7)As of March 31, 2018, the cumulative M3+ net charge-off rate for credit loans originated in the first vintage, from the inception to March 31, 2016, was 3.95%, compared to 3.09% as of December 31, 2017. As of March 31, 2018, the cumulative M3+ net charge-off rate for credit loans originated in the second vintage, for fiscal year 2017, was 2.58%, compared to 1.37% as of December 31, 2017. As of March 31, 2018, the cumulative M3+ net charge-off rate for credit loans originated in the third vintage, for fiscal year 2018, was 0.11%, compared to 0.03% for loans originated in the third vintage, for the period April 1, 2017 to December 31, 2017 as of December 31, 2017.

 

Through Hexindai’s platform, the total loan volume facilitated was approximately US$2.6 billion (RMB16.7 billion) from the inception of its business in March 2014 through March 31, 2018.

 

Fiscal Year Ended March 31, 2018 Financial Highlights (Unaudited)

 

·                      Net revenue was US$107.3 million in the fiscal year ended March 31, 2018, an increase of 368.0% from last fiscal year.

·                      Operating expenses were US$31.4 million in the fiscal year ended March 31, 2018, an increase of 141.3% from last fiscal year.

·                      Net income was US$65.5 million in the fiscal year ended March 31, 2018, an increase of 664.3% from last fiscal year.

·                      Basic EPS in the fiscal year ended March 31, 2018 was US$1.46 compared to US$0.20 in last fiscal year.

 


(6) We define the delinquency rates as of the end of the period as the outstanding balance of principal and interest that were 15 to 29, 30 to 59 and 60 to 89 calendar days delinquent as a percentage of the total outstanding balance of principal and interest for the relevant group of loans during such period.

 

(7) We define ‘‘M3+ Net Charge-off Rates’’, with respect to loans facilitated during a specified time period or the ‘‘vintage’’, as the total balance of outstanding principal of loans that become delinquent for over three months during a specified period and the remainder of the expected interest for the life of such loans, divided by the total principal of the loans facilitated in such vintage.

 



 

·                      Diluted EPS in the fiscal year ended March 31, 2018 was US$1.37 compared to US$0.20 in last fiscal year.

·                      Adjusted net income attributable to Hexindai Inc.’s shareholders (Non-GAAP) in the fiscal year ended 2018 was US$67.3 million, increased by 685.3% from US$8.6 million in last fiscal year.

·                      Adjusted EBIT (Non-GAAP) in the fiscal year ended 2018 was US$78.0 million, increased by 679.2% from US$10.0 million in last fiscal year.

 

“We finished the year with another great quarter of growth in which loan volumes increased by 236.7%,” commented Mr. Xinming Zhou, Chief Executive Officer of Hexindai. “Net revenue increased by 270.7% during the quarter to US$27.6 million compared to the same period of last fiscal year and net income expanded to US$17.0 million. Looking at the full year,  the loan volumes increased by 151.2% to US$1.3 billion and net income increased by 664.3% to US$65.5 million. These solid results were driven by our strong user acquisition capabilities and improved user conversion rates.”

 

“To further diversify our user acquisition channels, we opened a call center in Hefei, Anhui Province during the quarter which will facilitate first-time investments made by registered investors on our platform and increase retention rates among existing investors. Our recently launched microlending business, while risks being well managed, will complement our core business as an online consumer lending marketplace by generating additional revenue streams. We will continue to invest in enhancing our research and development capabilities, expanding our marketing efforts and strengthening our risk management systems to solidify our competitive advantage in China’s rapidly growing consumer lending marketplace.”

 

Accounting Policy Changes

 

Effective on April 1, 2018, Hexindai has adopted a new revenue recognition policy, ASC 606 — Revenue from Contracts with Customers, in accordance with US GAAP. The Company has completed the assessment on revenue recognition for the business under ASC 606, and concluded that there will be no material impact on the Company’s financial condition based on current preliminary assessments.

 

Fourth Quarter of Fiscal Year 2018 Unaudited Financial Results

 

Net revenue

 

Net revenue during the fourth quarter of fiscal year 2018 was US$27.6 million, an increase of 270.7% compared to US$7.4 million during the same quarter of fiscal year 2017. The increase was primarily due to the significant increase in the volume of credit loans facilitated through Hexindai’s marketplace, which increased from US$0.1 billion (RMB0.7 billion) in the fourth quarter of fiscal year 2017 to US$0.4 billion ( RMB2.7 billion ) in the same quarter of fiscal year 2018. The increase in the volume of credit loans facilitated through our marketplace was driven by an increase in the number of credit loan borrowers from 8,650 in the fourth quarter of fiscal year 2017 to 33,322 in the same quarter of fiscal year 2018. The risk reserve liability charge decreased from US$0.8 million in the three months ended March 31, 2017 to nil in the three months ended March 31, 2018 as our risk reserve liability policy has been discontinued and replaced by a third party insurance arrangement since February 1, 2017, there was no risk reserve liability charge in the three months ended March 31, 2018, which also contributed to the increase of net revenue.

 

Operating expenses

 

Total operating expenses during the fourth quarter of fiscal year 2018 were US$8.4 million, an increase of 115.2% from US$3.9 million in the same quarter of last fiscal year. The significant increase was primarily due to increase in sales and marketing expenses and general and administrative expenses.

 

Sales and marketing expenses

 

Sales and marketing expenses during the fourth quarter of fiscal year 2018 were US$3.5 million, an increase of 79.7% from US$1.9 million during the same quarter of last fiscal year. The increase was primarily due to an increase in employee expenses and a series of promotional and brand image campaigns to enhance the Company’s brand recognition and acquire more customers.

 



 

Service and development expenses

 

Service and development expenses during the fourth quarter of fiscal year 2018 were US$2.1 million, an increase of 61.0% from US$1.3 million during the same quarter of last fiscal year. The increase was primarily attributable to an increase in employee expenses and custodian bank account management fees which were mainly driven by the growth in the volume of loans facilitated through the Company’s platform.

 

General and administrative expenses

 

General and administrative expenses during the fourth quarter of fiscal year 2018 were US$1.7 million, an increase of 157.3% from US$0.7 million during the same period of last fiscal year. The increase was primarily attributable to an increase in employee expenses and professional service fees.

 

Share-based compensation

 

Share-based compensation during the fourth quarter of fiscal year 2018 was US$1.1 million, increased from nil during the same period of last fiscal year. The increase was attributable to awards granted under the 2016 Equity Incentive Plan since November 3, 2017 on which date the Company completed its IPO.

 

Net income

 

As a result of the foregoing, an increase of 303.0% in our net income, which increased from US$4.2 million during the fourth quarter of fiscal year 2017 to US$17.0 million during the same quarter of fiscal year 2018.

 

Net income attributable to Hexindai Inc.’s shareholders and EPS

 

Net income attributable to the Company’s shareholders increased by 303.0% to US$17.0 million in the fourth quarter of fiscal year 2018 from US$4.2 million in the same period of last fiscal year. Accordingly, the earnings per basic share increased to US$0.36 in the fourth quarter of fiscal year 2018 from US$0.10 in the same period of fiscal year 2017 and earnings per diluted share increased to US$0.32 in the fourth quarter of fiscal year 2018 from US$0.10 in the same period of fiscal year 2017.

 

Adjusted net income attributable to Hexindai Inc.’s shareholders and adjusted EPS

 

Adjusted net income attributable to the Company’s shareholders, which excluded share-based compensation expenses, increased by 329.8% to US$18.2 million in the fourth quarter of fiscal year 2018 from US$4.2 million in the same quarter of fiscal year 2017. Accordingly, the adjusted earnings per basic share increased to US$0.38 in the fourth quarter of fiscal year 2018 from US$0.10 in the same period of fiscal year 2017 and the adjusted earnings per diluted share increased to US$0.34 in the fourth quarter of fiscal year 2018 from US$ 0.10 in the same quarter of fiscal year 2017.

 

Fiscal Year Ended March 31, 2018 Unaudited Financial Results

 

Net revenue

 

Net revenue during the fiscal year ended March 31, 2018 was US$107.3 million, an increase of 368.0% from US$22.9 million in last fiscal year. The increase was primarily due to the significant increase in the volume of credit loans facilitated through Hexindai’s marketplace, which increased from RMB2.3 billion (US$0.3 billion) in the fiscal year ended March 31, 2017 to RMB8.3 billion (US$1.2 billion) in the fiscal year ended March 31, 2018. The increase in the volume of credit loans facilitated through our marketplace was driven by an increase in the number of credit loan borrowers from 28,374 in the fiscal year ended March 31, 2017 to 101,137 in the fiscal year ended March 31, 2018. The increase in net revenues was also due to the increase in gross billing ratio (net of VAT) for credit loans from 7.6% in the fiscal year ended March 31, 2017 to 9.5% in the fiscal year ended March 31, 2018. The risk reserve liability charge decreased from US$4.9 million in the fiscal year ended March 31, 2017 to nil in the fiscal year ended March 31, 2018 as our risk reserve liability policy has been discontinued and replaced by a third party insurance arrangement since February 1, 2017, there was no risk reserve liability charge in the fiscal year ended March 31, 2018, which also contributed to the increase of net revenue.

 



 

Operating expenses

 

Total operating expenses during the fiscal year ended March 31, 2018 were US$31.4 million, an increase of 141.3% from US$13.0 million in fiscal year ended March 31, 2017. The increase was primarily due to increase in sales and marketing expenses, service and development expenses and general and administrative expenses.

 

Sales and marketing expenses

 

Sales and marketing expense during the fiscal year ended March 31, 2018 were US$15.2 million, an increase of 192.4% from US$5.2 million from last fiscal year. The increase was primarily due to an increase in employee expenses, expenses paid to advertising vendors for online acquisition of borrowers and investors, and a series of marketing and promotional campaigns, included a marketing campaign for new products launched in July 2017, to enhance the Company’s brand image.

 

Service and development expenses

 

Service and development expenses during the fiscal year ended March 31, 2018 were US$8.5 million, an increase of 65.0% from US$5.1 million during last fiscal year. The increase was primarily attributable to an increase in employee expenses, custodian bank account management fees and rental and property management fees which were mainly driven by the growth in the volume of loans facilitated through the Company’s platform.

 

General and administrative expenses

 

General and administrative expenses during the fiscal year ended March 31, 2018 were US$5.8 million, an increase of 119.8% from US$2.6 million during last year. The increase was primarily attributable to an increase in employee expenses and professional service fees.

 

Share-based compensation

 

Share-based compensation during the fiscal year 2018 was US$1.8 million, increased from nil during last fiscal year. The increase was attributable to awards granted under the 2016 Equity Incentive Plan since November 3, 2017 on which date the Company completed its IPO.

 

Net income

 

As a result of the foregoing, a significant increase of 664.3% in our net income, which increased from US$8.6 million during the fiscal year ended March 31, 2017 to US$65.5 million during this fiscal year.

 

Net income attributable to Hexindai Inc.’s shareholders and EPS

 

Net income attributable to the Company’s shareholders increased by 664.0% to US$65.5 million in fiscal year 2018 from US$8.6 million in last fiscal year. Accordingly, the earnings per basic share increased to US$1.46 in fiscal year 2018 from US$0.20 in fiscal year 2017 and earnings per diluted share increased to US$1.37 in fiscal year 2018 from US$0.20 in fiscal year 2017.

 

Adjusted net income attributable to Hexindai Inc.’s shareholders and adjusted EPS

 

Adjusted net income attributable to the Company’s shareholders, which excluded share-based compensation expenses, increased by 685.7% to US$67.3 million during the fiscal year ended March 31, 2018 from US$8.6 million in the fiscal year ended March 31 2017. Accordingly, the adjusted earnings per basic share increased to US$1.50 during the fiscal year ended March 31, 2018 from US$0.20 in last fiscal year and the adjusted earnings per diluted share increased to US$1.41 during the fiscal year ended March 31, 2018 from US$0.20 in last fiscal year.

 



 

Cash and Cash Flow

 

As of March 31, 2018, the Company had cash and cash equivalents of US$132.6 million. Net cash provided by operating activities for the fiscal year ended March 31, 2018 was US$87.7 million, compared to net cash provided by operating activities of US$8.2 million in last fiscal year. The increase in operating cash flow was mainly due to increased net income during fiscal year ended March 31, 2018. Net cash used in investing activities for the fiscal year end March 31, 2018 was US$27.6 million, compared to US$0.3 million in last fiscal year. The increase in investing cash flow was due to the loan principal originated through our microlending business. Net cash provided by financing activities for the fiscal year ended March 31, 2018 was US$47.5 million, compared to net cash provided by financing activities of US$4.3 million in the same period of last fiscal year. The increase in financing activities was mainly due to the net proceeds of US$43.3million raised from IPO after deducting related costs and expenses.

 

Business Outlook

 

Based on the information available as of the date of this press release, Hexindai provides the following outlook, which reflects the Company’s current and preliminary view and is subject to change (see Safe Harbor Statement below):

 

Three Months Ending June 30, 2018

 

·             Total loans facilitated will be in the range of US$460.0 million to US$510.0 million.

·             Net revenue will be in the range of US$51.0 million to US$56.0 million.

·             Adjusted net income will be in the range of US$26.0 million to US$29.0 million.

 

Fiscal Year Ending March 31, 2019

 

·             Total loans facilitated will be in the range of US$1.9 billion to US$2.1 billion.

·             Net revenue will be in the range of US$240.0 million to US$260.0 million.

·             Adjusted net income will be in the range of US$115.0 million to US$127.0 million.

 

Use of Non-GAAP Financial Measures

 

We used adjusted net income, adjusted EPS and adjusted EBIT, non-GAAP financial measures, in evaluating our operating results and for financial and operational decision-making purposes. We believed that the non-GAAP financial measures helped identify underlying trends in our business by excluding the impact of share-based compensation expenses, which were non-cash charges. We believed that the adjusted net income provided useful information about our operating results, enhance the overall understanding of our past performance and future prospects and allow for greater visibility with respect to key metrics used by our management in its financial and operational decision-making.

 

The non-GAAP measures were not defined under U.S. GAAP and was not presented in accordance with U.S. GAAP. This non-GAAP financial measure had limitations as analytical tools, and when assessing our operating performance, cash flows or our liquidity, investors should not consider them in isolation, or as a substitute for net income, cash flows provided by operating activities or other consolidated statements of operation and cash flow data prepared in accordance with U.S. GAAP.

 

We mitigate these limitations by reconciling the non-GAAP financial measures to the most comparable U.S. GAAP performance measure, all of which should be considered when evaluating our performance.

 

For more information on this non-GAAP financial measures, please see the table captioned “Reconciliations of GAAP and non-GAAP measures” set forth at the end of this press release.

 

Exchange Rate Information

 

Our business was conducted in China, and our financial records were maintained in RMB, our functional currency. However, we used the U.S. dollar as our reporting currency; therefore, periodic reports made to shareholders will include current period amounts translated into U.S. dollars using the then-current exchange rates, for the convenience of the readers. The financial information was first prepared in RMB and then was translated into U.S. dollars at period-end exchange rates in the H.10 statistical release of the Federal Reserve Board as to assets and liabilities and average exchange rates as to revenue and expenses. Capital accounts were translated at their historical exchange rates when the capital transactions occurred. The effects of foreign currency translation adjustments were included as a component of accumulated other comprehensive income (loss) in shareholders’ equity. We make no representation that any RMB or U.S. dollar amounts could have been, or could be, converted into U.S. dollars or RMB, as the case may be, at any particular rate, or at all. The PRC government imposes control over its foreign currency reserves in part through direct regulation of the conversion of RMB into foreign exchange and through restrictions on foreign trade.

 



 

Statement Regarding Preliminary Unaudited Financial Information

 

The unaudited financial information set out in this earnings release is preliminary and subject to potential adjustments. Adjustments to the consolidated financial statements may be identified when audit work has been performed for the Company’s year-end audit, which could result in significant differences from this preliminary unaudited financial information.

 

Recent Developments

 

Microlending Business

 

Hexindai recently began operating an online microlending business through a newly established entity (“Wusu Company”) majority owned by Hexin E-Commerce Co., Ltd. which is the existing VIE of Hexindai. Wusu Company was registered in Wusu City, Xinjiang province on August 28, 2017. Through a series of contractual agreements, Hexindai obtained control of the remaining interest of Wusu Company, on January 1, 2018. Wusu Company has registered capital of RMB200 million to originate loans. Default risk will be carefully controlled with the maximum outstanding balance of loans not exceeding RMB200 million.

 

Insurance Renewal

 

In April 2018, Hexindai renewed its annual insurance framework agreement with Changan Insurance. In the new agreement, the total premium paid by borrowers to Changan Insurance included (1) loan default risk premium that equaled to 2.0% of the loan principal and accrued interest of credit loans, and (2) service fee that equaled to 2% of the loan principal, which reflects the Company’s expected default rate for fiscal year 2019 when we will purely facilitate credit loans compared to a mix of credit and secured loans in the previous year.

 

Conference Call

 

The Company will host a conference call to discuss the earnings at 7:00 a.m. Eastern Time on Friday, June 15, 2018 (7:00 p.m. Beijing time on the same day).

 

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

 

International

 

+65 6713-5090

U.S. Toll Free

 

+1 866-519-4004

Mainland China

 

4006-208038

Hong Kong Toll Free

 

8009-06601

Passcode: HX

 

 

 

A telephone replay of the call will be available two hours after the conclusion of the conference call through 9:59 p.m. Hong Kong Time, June 23, 2018.

 

Dial-in numbers for the replay are as follows:

 

International Dial-in

 

+61 2-8199-0299

U.S. Toll Free

 

+1 855-452-5696

Passcode: 6836748

 

 

 

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

 



 

About Hexindai Inc.

 

Hexindai Inc. (NASDAQ: HX) (“Hexindai” or the “Company”) is a fast-growing consumer lending marketplace based in Beijing, China facilitating loans to meet the increasing consumption demand of the emerging middle class in China. Hexindai provides borrowers with convenient and ready access to credit through its online marketplace. The Company offers borrowers a wide range of products designed based on customer segmentation data and tailored to the specific needs of the emerging middle class in China by matching them with investors seeking various types of investment products with appropriate risk levels and risk-adjusted returns. Hexindai’s strong online and offline user acquisition capabilities combined with an online platform with extensive offline networks, an advanced risk management system, and strong strategic cooperative relationships with a custodian bank and an insurance company to safeguard investments, allows the Company to generate higher customer satisfaction, reliance, and realize faster growth in China.

 

Safe Harbor Statement

 

This announcement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “potential,” “continue,” “ongoing,” “targets,” “guidance” and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Any statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements that involve factors, risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such factors and risks include, but not limited to the following: the Company’s goals and strategies; its future business development, financial condition and results of operations; the expected growth of the credit industry, and marketplace lending in particular, in China; the demand for and market acceptance of its marketplace’s products and services; its ability to attract and retain borrowers and investors on its marketplace; its relationships with its strategic cooperation partners; competition in its industry; and relevant government policies and regulations relating to the corporate structure, business and industry. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this announcement is current as of the date of this announcement, and the Company does not undertake any obligation to update such information, except as required under applicable law.

 

For more information, please visit ir.hexindai.com

 

For investor inquiries, please contact:

 

Hexindai

 

Ms. Daisy Wang

Tel: +86-10-5370-9902 ext. 849

Email: ir@hexindai.com

 

Christensen

 

In China

Mr. Christian Arnell

Phone: +86-10- 5900-1548

E-mail: carnell@christensenir.com

 

In US

Mr. Tip Fleming

Phone: +1-917-412-3333

Email: tfleming@Christensenir.com

 



 

HEXINDAI INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

 

 

 

 

March 31,

 

March 31,

 

 

 

2018

 

2017

 

ASSETS

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

Cash

 

$

132,622,467

 

$

19,232,275

 

Prepayments and other assets

 

1,248,562

 

4,139,354

 

Amounts due from related parties

 

 

4,182,502

 

Loans receivable

 

28,696,234

 

 

Interest receivable

 

555,502

 

 

TOTAL CURRENT ASSETS

 

163,122,765

 

27,554,131

 

Property, equipment and software at cost, net

 

767,087

 

427,938

 

Deferred tax assets

 

 

400,062

 

TOTAL ASSETS

 

$

163,889,852

 

$

28,382,131

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

Accrued expenses and other current liabilities

 

$

3,786,955

 

$

789,129

 

Taxes payable

 

20,059,828

 

4,088,646

 

TOTAL CURRENT LIABILITIES

 

23,846,783

 

4,877,775

 

TOTAL LIABILITIES

 

$

23,846,783

 

$

4,877,775

 

 

 

 

 

 

 

EQUITY:

 

 

 

 

 

Ordinary shares, $0.0001 par value, 500,000,000 shares authorized, 47,958,550 and 42,921,600 shares issued and outstanding as of March 31, 2018 and 2017, respectively.

 

4,796

 

4,292

 

Additional paid-in capital

 

58,417,971

 

13,285,717

 

Retained earnings

 

77,241,073

 

11,759,100

 

Accumulated other comprehensive income (loss)

 

4,379,229

 

(1,544,753

)

TOTAL EQUITY

 

140,043,069

 

23,504,356

 

 

 

 

 

 

 

TOTAL LIABILITIES AND EQUITY

 

$

163,889,852

 

$

28,382,131

 

 



 

HEXINDAI INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(UNAUDITED)

 

 

 

For Three Months Ended
March 31,

 

For the Years Ended
March 31,

 

 

 

2018

 

2017

 

2018

 

2017

 

REVENUE

 

 

 

 

 

 

 

 

 

Loan facilitation, post-origination and other service, net

 

$

27,991,650

 

$

7,530,001

 

$

108,148,255

 

$

23,092,405

 

Business and sales related taxes

 

(377,792

)

(81,594

)

(890,414

)

(171,862

)

NET REVENUE

 

27,613,858

 

7,448,407

 

107,257,841

 

22,920,543

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

Sales and marketing

 

3,496,941

 

1,946,039

 

15,241,637

 

5,212,127

 

Service and development

 

2,054,458

 

1,275,931

 

8,495,768

 

5,149,265

 

General and administrative

 

1,697,319

 

659,686

 

5,816,130

 

2,645,605

 

Share-based compensation

 

1,105,037

 

 

1,828,868

 

 

Total operating expenses

 

8,353,755

 

3,881,656

 

31,382,403

 

13,006,997

 

INCOME FROM OPERATIONS

 

19,260,103

 

3,566,751

 

75,875,438

 

9,913,546

 

OTHER INCOME (EXPENSE)

 

 

 

 

 

 

 

 

 

Other income

 

169,598

 

18,530

 

683,393

 

198,624

 

Other expense

 

(2,191

)

(3,267

)

(22,516

)

(19,095

)

Total other income, net

 

167,407

 

15,263

 

660,877

 

179,529

 

INCOME BEFORE INCOME TAXES

 

19,427,510

 

3,582,014

 

76,536,315

 

10,093,075

 

PROVISION (BENEFIT) FOR INCOME TAXES

 

2,382,315

 

(647,383

)

11,025,690

 

1,522,211

 

NET INCOME

 

17,045,195

 

4,229,397

 

65,510,625

 

8,570,864

 

Less: net income attributable to non-controlling interest

 

 

 

28,652

 

 

NET INCOME ATTRIBUTABLE TO HEXINDAI’S SHAREHOLDERS

 

17,045,195

 

4,229,397

 

65,481,973

 

8,570,864

 

 

 

 

 

 

 

 

 

 

 

OTHER COMPREHENSIVE INCOME (LOSS)

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

3,419,954

 

75,721

 

6,028,143

 

(1,080,036

)

COMPREHENSIVE INCOME

 

20,465,149

 

4,305,118

 

71,538,768

 

7,490,828

 

 

 

 

 

 

 

 

 

 

 

Less: comprehensive income attributable to non-controlling interest

 

 

 

132,814

 

 

COMPREHENSIVE INCOME ATTRIBUTABLE TO HEXINDAI’S SHARESHOLDERS

 

$

20,465,149

 

$

4,305,118

 

$

71,405,954

 

$

7,490,828

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share*-basic

 

$

0.36

 

$

0.10

 

$

1.46

 

$

0.20

 

Earnings per common share*-diluted

 

$

0.32

 

$

0.10

 

$

1.37

 

$

0.20

 

Weighted average number of shares outstanding*-basic

 

47,958,550

 

42,921,600

 

44,977,780

 

42,331,200

 

Weighted average number of shares outstanding*-diluted

 

53,269,615

 

42,921,600

 

47,656,263

 

42,331,200

 

 


* The shares and per share data are presented on a retroactive basis to reflect the nominal share issuance.

 



 

HEXINDAI INC.

RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS

(UNAUDITED)

 

 

 

For Three Months Ended
March 31,

 

For the Years Ended
March 31,

 

 

 

2018

 

2017

 

2018

 

2017

 

Net income attributable to Hexindai Inc.’s shareholders

 

$

17,045,195

 

4,229,397

 

65,481,973

 

8,570,864

 

Add: Share-based compensation expenses

 

1,105,037

 

 

1,828,868

 

 

Adjusted net income attributable to Hexindai Inc.’s shareholders

 

$

18,178,884

 

4,229,397

 

67,310,841

 

8,570,864

 

Weighted average number of shares outstanding*-basic

 

47,958,550

 

42,921,600

 

44,977,780

 

42,331,200

 

Weighted average number of shares outstanding*-diluted

 

53,269,615

 

42,921,600

 

47,656,263

 

42,331,200

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share*-basic

 

$

0.36

 

$

0.10

 

$

1.46

 

$

0.20

 

Adjustment related to share based compensation expenses*-basic

 

$

0.02

 

$

 

$

0.04

 

$

 

Adjusted earnings per common share*-basic

 

$

0.38

 

$

0.10

 

$

1.50

 

$

0.20

 

 

 

 

 

 

 

 

 

 

 

Earnings per common share*-diluted

 

$

0.32

 

$

0.10

 

$

1.37

 

$

0.20

 

Adjustment related to share based compensation expenses*-diluted

 

$

0.02

 

$

 

$

0.04

 

$

 

Adjusted earnings per common share*-diluted

 

$

0.34

 

$

0.10

 

$

1.41

 

$

0.20

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to Hexindai Inc.’s shareholders

 

17,045,195

 

4,229,397

 

65,481,973

 

8,570,864

 

Add: Interest income

 

(92,287

)

(13,373

)

(343,370

)

(83,950

)

Income tax expense

 

2,382,315

 

(647,383

)

11,025,690

 

1,522,211

 

Share-based compensation expenses

 

1,105,037

 

 

1,828,868

 

 

Adjusted EBIT

 

20,440,260

 

3,568,641

 

77,993,161

 

10,009,125

 

 


* The shares and per share data are presented on a retroactive basis to reflect the nominal share issuance.

 



 

The following table presents our summary operating data for three months and fiscal year ended March 31, 2017 and 2018.

 

 

 

For Three Months Ended March 31,

 

For the Years Ended March 31,

 

 

 

 

 

 

 

2018

 

2017

 

2018

 

2017

 

Growth Rates(4)

 

 

 

(RMB)

 

(US$)

 

(RMB)

 

(US$)

 

(RMB)

 

(US$)

 

(RMB)

 

(US$)

 

Three months
ended March 31,
2018 compared to
March 31, 2017

 

For the fiscal year
ended March 31,
2018 compared to
March 31, 2017

 

 

 

(in thousands, except percentages and numbers)

 

(in thousands, except percentages and numbers)

 

 

 

 

 

Loan volume facilitated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit loan principal

 

2,658,495

 

418,427

 

732,190

 

106,341

 

8,268,844

 

1,248,033

 

2,264,421

 

336,727

 

263.1

%

265.2

%

Secured loan principal

 

 

 

57,471

 

8,347

 

63,220

 

9,542

 

1,053,095

 

156,599

 

-100.0

%

-94.0

%

Total

 

2,658,495

 

418,427

 

789,661

 

114,688

 

8,332,064

 

1,257,575

 

3,317,516

 

493,326

 

236.7

%

151.2

%

Number of transactions facilitated(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit loan transactions

 

33,396

 

33,396

 

8,650

 

8,650

 

101,361

 

101,361

 

28,374

 

28,374

 

 

 

 

 

Secured loan transactions

 

 

 

38

 

38

 

49

 

49

 

1,254

 

1,254

 

 

 

 

 

Total

 

33,396

 

33,396

 

8,688

 

8,688

 

101,410

 

101,410

 

29,628

 

29,628

 

 

 

 

 

Average individual transaction amount

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit loan transactions

 

80

 

13

 

85

 

12

 

82

 

12

 

80

 

12

 

 

 

 

 

Secured loan transactions

 

 

 

1,512

 

220

 

1,290

 

195

 

840

 

125

 

 

 

 

 

Overall average

 

80

 

13

 

91

 

13

 

82

 

12

 

112

 

17

 

 

 

 

 

Gross billing amount (net of VAT)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit loan

 

202,246

 

31,832

 

59,213

 

8,600

 

784,355

 

118,384

 

172,401

 

25,637

 

241.6

%

355.0

%

Secured loan

 

 

 

1,864

 

271

 

1,458

 

220

 

14,700

 

2,186

 

-100.0

%

-90.1

%

Total

 

202,246

 

31,832

 

61,077

 

8,871

 

785,813

 

118,604

 

187,101

 

27,823

 

231.1

%

320.0

%

Gross billing ratio (net of VAT)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit loan

 

7.6

%

7.6

%

8.1

%

8.1

%

9.5

%

9.5

%

7.6

%

7.6

%

 

 

 

 

Secured loan

 

 

 

3.2

%

3.2

%

2.3

%

2.3

%

1.4

%

1.4

%

 

 

 

 

Total

 

7.6

%

7.6

%

7.7

%

7.7

%

9.4

%

9.4

%

5.6

%

5.6

%

 

 

 

 

Number of borrowers

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit loan transactions

 

33,322

 

33,322

 

8,650

 

8,650

 

101,137

 

101,137

 

28,374

 

28,374

 

 

 

 

 

Secured loan transactions

 

 

 

1

 

1

 

35

 

35

 

364

 

364

 

 

 

 

 

Total

 

33,322

 

33,322

 

8,651

 

8,651

 

101,172

 

101,172

 

28,738

 

28,738

 

285.2

%

252.0

%

Number of investors

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit loan transactions (2)

 

52,231

 

52,231

 

18,505

 

18,505

 

117,016

 

117,016

 

25,679

 

25,679

 

 

 

 

 

Secured loan transactions (3)

 

 

 

178

 

178

 

76

 

76

 

13,795

 

13,795

 

 

 

 

 

Credit and secured loan transactions

 

9,808

 

9,808

 

11,853

 

11,853

 

20,858

 

20,858

 

23,861

 

23,861

 

 

 

 

 

Total

 

62,039

 

62,039

 

30,536

 

30,536

 

137,950

 

137,950

 

63,335

 

63,335

 

103.2

%

117.8

%

 


(1) Number of  transactions facilitated is defined as the total number of loans facilitated on our marketplace during the relevant period.

(2) Refers to investors who exclusively invested in credit loan transactions during the relevant period.

(3) Refers to investors who exclusively invested in secured loan transactions during the relevant period.

(4) Growth rates are calculated by RMB and exclude the impact from exchange rate in different reporting period to reflect a real growth rate.

 



 

The following table sets forth our revenue breakdown for the periods indicated:

 

 

 

For the Three Months Ended
March 31,

 

For the Fiscal Years Ended
March 31,

 

 

 

2018

 

2017

 

2018

 

2017

 

Revenue (1)

 

 

 

 

 

 

 

 

 

Loan facilitation service

 

$

30,929,552

 

$

8,734,161

 

$

117,984,295

 

$

25,636,661

 

Loan management service

 

104,002

 

250,289

 

508,948

 

2,678,557

 

Post-origination service

 

1,819,683

 

159,578

 

4,213,862

 

1,219,897

 

Interest income

 

590,122

 

 

590,122

 

 

Others

 

(483

)

9,290

 

21,434

 

59,756

 

Business tax

 

(377,792

)

(81,594

)

(890,414

)

(171,862

)

Cash incentives

 

(5,451,226

)

(783,997

)

(15,170,406

)

(1,629,316

)

Risk reserve liability charge

 

 

(839,320

)

 

(4,873,150

)

Net Revenue

 

$

27,613,858

 

$

7,448,407

 

$

107,257,841

 

$

22,920,543

 

 


(1) Represents amounts net of VAT

 

The following tables set forth our delinquency rates for all loans as of March 31, 2016, 2017 and 2018, respectively:

 

Delinquency Rates (1)

 

 

 

Delinquent for

 

 

 

15 - 29 days

 

30 - 59 days

 

60 - 89 days

 

March 31, 2016

 

0.092

%

0.074

%

0.061

%

March 31, 2017

 

0.091

%

0.138

%

0.331

%

March 31, 2018

 

0.066

%

0.152

%

0.120

%

 


(1) Loans that are delinquent for more than 89 days are counted towards the M3+ Net Charge-off Rates. See ‘‘—M3+ Net Charge-off Rates.’’

 

The following table provides the amount of credit loans generated through our marketplace during each of the periods presented and the corresponding accumulated M3+ Net Charge-off and M3+ Net Charge-off Rates data as of December 31, 2017 and March 31, 2018 for the credit loans facilitated during each of the periods presented.

 

M3+ Net Charge-off Rates

 

Loan issued period

 

Amount of loans facilitated
during the period

 

Accumulated M3+Net
Charge-off as of
March 31, 2018

 

Total M3+Net
Charge-Off Rate as of
March 31, 2018

 

 

 

(RMB)

 

(USD)

 

(RMB)

 

(USD)

 

Percentage

 

 

 

(in thousands)

 

(in thousands)

 

 

 

Since inception to March 31, 2016

 

678,849

 

107,466

 

26,801

 

4,182

 

3.95

%

From April 1, 2016 to March 31, 2017

 

2,264,421

 

336,727

 

58,513

 

8,501

 

2.58

%

From April 1, 2017 to March 31, 2018

 

8,268,844

 

1,248,033

 

8,858

 

1,412

 

0.11

%

 



 

M3+ Net Charge-off Rates

 

Loan issued period

 

Amount of loans facilitated
during the period

 

Accumulated M3+Net
Charge-off as of
December 31, 2017

 

Total M3+Net
Charge-Off Rate as
of December 31,
2017

 

 

 

(RMB)

 

(USD)

 

(RMB)

 

(USD)

 

Percentage

 

 

 

(in thousands)

 

(in thousands)

 

 

 

Since inception to March 31, 2016

 

678,849

 

107,466

 

20,960

 

3,276

 

3.09

%

From April 1, 2016 to March 31, 2017

 

2,264,421

 

336,727

 

30,982

 

4,501

 

1.37

%

From April 1, 2017 to December 31, 2017

 

5,610,349

 

835,471

 

1,786

 

263

 

0.03

%