6-K

 

 

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 March 2023

Commission File Number: 001-38328

 

LexinFintech Holdings Ltd.

 

27/F CES Tower

No. 3099 Keyuan South Road

Nanshan District, Shenzhen 518057

The People's Republic of China

(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):________________

 

 


 

SIGNATURES

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.

 

LexinFintech Holdings Ltd.

 

 

 

 

By

 

/s/ James Zheng

Name:

 

James Zheng

Title:

 

Chief Financial Officer

 

Date: March 13, 2023

 

 

 


 

Exhibit Index

Exhibit 99.1—Press Release

 

 


EX-99

 

Exhibit 99.1

LexinFintech Holdings Ltd. Reports Fourth Quarter and Full Year 2022

Unaudited Financial Results

SHENZHEN, China, March 13, 2023 (GLOBE NEWSWIRE) -- LexinFintech Holdings Ltd. (“Lexin” or the “Company”) (NASDAQ: LX), a leading technology-empowered personal financial service enabler in China, today announced its unaudited financial results for the quarter ended December 31, 2022.

"Total loan origination for the fourth quarter of 2022 was well in line with the high end of our initial expectations of over RMB56.1 billion, representing a year-over-year growth of 28.8%. Moreover, our total outstanding loan balance was over RMB99.6 billion, an increase of 15.9% year-over-year," said Jay Wenjie Xiao, chairman and chief executive officer of Lexin. "2022 was indeed an eventful year with various internal and external challenges, and yet we managed to deliver very solid results. Throughout the year, we maintained the trajectory of a V-shaped recovery in our overall performance."
 

"In the past year, in addition to our commitment to continuous technological innovation and optimizing operational efficiency, we have also made noteworthy progress in both our risk management capabilities and our regulatory compliance. Our overall core competencies have been notably upgraded. Looking ahead, we are confident in the resilience of China's economic and consumption recovery and believe that Lexin is better positioned at present than ever to navigate through the uncertainties and utilize the opportunities given to us to pursue greater and more reliable growth in a continued and sustainable manner." Mr. Xiao continued.
 

"We ended the 2022 financial year with solid fourth-quarter results, demonstrating the continued turnaround of our business despite the challenging business environment throughout the year." said Mr. James Zheng, chief financial officer of Lexin, "Total operating revenue for the fourth quarter was RMB3.1 billion, an increase of 38.7% year-over-year, and 13.4% quarter-on-quarter, and our net profit also continued to improve for the third consecutive quarter, reaching approximately RMB301 million, an increase of 17.9% year-over-year and 9.3% quarter-on-quarter. In addition, we were encouraged by improvements in other metrics such as a higher take-rate, as well as continued reductions in operating expenses, funding costs and APRs in compliance with the regulator’s guidance."
 

"Going forward, while we see signs of improving growth and recovery in the macro-economy, as well as a more stable regulatory environment, we would also like to reiterate our strong commitment to generating sustainable long-term profits by continuously focusing on upgrading our risk management capability, improving our business model, optimizing our operational efficiency, improving our customer acquisition, and continuing our cost reduction initiatives." said Mr. Zheng.
 

Fourth Quarter and Full Year 2022 Operational Highlights:

Total number of registered users reached 189 million as of December 31, 2022, representing an increase of 14.3% from 165 million as of December 31, 2021, and users with credit lines reached 40.0 million as of December 31, 2022, up by 8.5% from 36.9 million as of December 31, 2021.
As of December 31, 2022, we cumulatively originated RMB863 billion in loans, an increase of 30.9% from RMB659 billion a year ago.

 

Page 1 of 15


 

User Base

Number of active users1 who used our loan products in the fourth quarter of 2022 was 5.3 million, representing a decrease of 15.3% from 6.3 million in the fourth quarter of 2021. Number of active users1 who used our loan products in 2022 was 9.7 million, representing a decrease of 31.6% from 14.2 million in 2021.
Number of new active users who used our loan products in the fourth quarter of 2022 was 0.4 million, representing a decrease of 56.6% from 0.9 million in the fourth quarter of 2021. Number of new active users who used our loan products in 2022 was 2.4 million, representing a decrease of 59.1% from 5.9 million in 2021.

Loan Facilitation Business

Total loan originations2 in the fourth quarter of 2022 was RMB56.1 billion, an increase of 28.8% from RMB43.6 billion in the fourth quarter of 2021. Total loan originations2 in 2022 was RMB205 billion, a decrease of 4.3% from RMB214 billion in 2021.
Total outstanding principal balance of loans2 reached RMB99.6 billion as of December 31, 2022, representing an increase of 15.9% from RMB85.9 billion as of December 31, 2021.
Loan originations for small and micro business owners was RMB5.0 billion, for the fourth quarter, bringing the total number for 2022 to RMB20.1 billion.
Total number of orders placed on our platform in the fourth quarter of 2022 was 28.2 million, representing a decrease of 15.7% from 33.4 million in the fourth quarter of 2021. Number of orders placed on our platform in 2022 was 128 million, representing a decrease of 47.1% from 242 million in 2021.

Credit Performance

90 day+ delinquency ratio was 2.53% as of December 31, 2022, as compared with 2.66% as of September 30, 2022.
30 day+ delinquency ratio was 4.62% as of December 31, 2022, as compared with 4.61% as of September 30, 2022.
First payment default rate (30 day+) for new loan originations was below 1% as of December 31, 2022.

Tech-empowerment Service

For the fourth quarter of 2022, we served over 105 business customers with our tech-empowerment service. For full year 2022, we served over 145 business customers with our tech-empowerment service.
In the fourth quarter of 2022, the business customer retention rate3 of our tech-empowerment service was over 85%.

Installment E-commerce Platform Service

GMV4 in the fourth quarter of 2022 for our installment e-commerce platform service was RMB1,393 million, representing an increase of 40.2% from RMB993 million in the fourth quarter of 2021. Total GMV4 for 2022 was RMB4,390 million, representing an increase of 27.1% from RMB3,454 million in 2021.
In the fourth quarter of 2022, our installment e-commerce platform service served over 393,000 users and 2,500 merchants. In 2022, our installment e-commerce platform service served over 1,089,000 users and 4,700 merchants.

 

Page 2 of 15


 

Other Operational Highlights

The weighted average tenor of loans originated on our platform in the fourth quarter of 2022 was approximately 13.9 months, as compared with 10.3 months in the fourth quarter of 2021. The nominal APR5 was 15.7% for the fourth quarter of 2022, as compared with 12.4% in the fourth quarter of 2021.
In 2022, the weighted average tenor of loans originated on our platform was approximately 13.1 months, as compared with 11.2 months in 2021. The nominal APR5 was 15.1% for 2022, as compared with 14.5% for 2021.

Fourth Quarter 2022 Financial Highlights:

Total operating revenue was RMB3,050 million, representing an increase of 38.7% from the fourth quarter of 2021.
Credit facilitation service income was RMB1,964 million, representing an increase of 71.4% from the fourth quarter of 2021. Tech-empowerment service income was RMB413 million, representing a decrease of 34.6% from the fourth quarter of 2021. Installment e-commerce platform service income was RMB674 million, representing an increase of 59.3% from the fourth quarter of 2021.
Net income attributable to ordinary shareholders of the Company was RMB301 million, representing an increase of 17.7% from the fourth quarter of 2021. Net income per ADS attributable to ordinary shareholders of the Company was RMB1.68 on a fully diluted basis.
Adjusted net income attributable to ordinary shareholders of the Company6 was RMB390 million, representing an increase of 23.7% from the fourth quarter of 2021. Adjusted net income per ADS attributable to ordinary shareholders of the Company6 was RMB2.09 on a fully diluted basis.

Full Year 2022 Financial Highlights:

Total operating revenue was RMB9,866 million, representing a decrease of 13.3% from 2021.
Credit facilitation service income was RMB5,964 million, representing a decrease of 14.3% from 2021. Tech-empowerment service income was RMB1,846 million, representing a decrease of 33.2% from 2021. Installment e-commerce platform service income was RMB2,056 million, representing an increase of 23.7% from 2021.
Net income attributable to ordinary shareholders of the Company was RMB820 million, representing a decrease of 64.9% from 2021. Net income per ADS attributable to ordinary shareholders of the Company was RMB4.41 on a fully diluted basis.
Adjusted net income attributable to ordinary shareholders of the Company6 was RMB1,058 million, representing a decrease of 59.0% from 2021. Adjusted net income per ADS attributable to ordinary shareholders of the Company6 was RMB5.39 on a fully diluted basis.

__________________________

1.
Active users refer to, for a specified period, users who made at least one transaction during that period through our platform or through our third-party partners’ platforms using the credit line granted by us.
2.
Originations of loans and outstanding principal balance represent the origination and outstanding principal balance of both on- and off-balance sheet loans.
3.
Customer retention rate refers to the number of financial institution customers and partners who repurchase our service in the current quarter as a percentage of the total number of financial institution customers and partners in the preceding quarter.
4.
GMV refers to the total value of transactions completed for products purchased on our e-commerce and Maiya channel, net of returns.
5.
Nominal APR refers to all-in interest costs and fees to the borrower over the net proceeds received by the borrower as a percentage of the total loan originations of both on- and off-balance sheet loans.
6.
Adjusted net income attributable to ordinary shareholders of the Company, adjusted net income per ordinary share and per ADS attributable to ordinary shareholders of the Company are non-GAAP financial measures. For more information on non-GAAP financial measures, please see the section of “Use of Non-GAAP Financial Measures Statement” and the tables captioned “Unaudited Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this press release.

Page 3 of 15


 

Fourth Quarter 2022 Financial Results:

Operating revenue increased by 38.7% from RMB2,199 million in the fourth quarter of 2021 to RMB3,050 million in the fourth quarter of 2022.

Credit facilitation service income increased by 71.4% from RMB1,145 million in the fourth quarter of 2021 to RMB1,964 million in the fourth quarter of 2022. The increase was driven by increases in loan facilitation and servicing fees-credit oriented, financing income and guarantee income.

Loan facilitation and servicing fees-credit oriented increased by 40.1% from RMB606 million in the fourth quarter of 2021 to RMB849 million in the fourth quarter of 2022. The increase was primarily due to the significant increase in off-balance sheet loans originated under the credit-oriented model.

 

Guarantee income increased by 190.8% from RMB172 million in the fourth quarter of 2021 to RMB500 million in the fourth quarter of 2022. The increase was primarily driven by the increase in loan originations and the increase of outstanding balances in the off-balance sheet loans funded by certain institutional funding partners, which are accounted for under ASC 460, Guarantees.

 

Financing income increased by 67.3% from RMB367 million in the fourth quarter of 2021 to RMB615 million in the fourth quarter of 2022. The increase was primarily driven by the increase in the origination of on-balance sheet loans in the fourth quarter of 2022.

 

Tech-empowerment service income decreased by 34.6% from RMB631 million in the fourth quarter of 2021 to RMB413 million in the fourth quarter of 2022. The decrease was primarily due to the decrease of loan facilitation volume through the profit-sharing model within tech-empowerment service in the fourth quarter of 2022.

 

Installment e-commerce platform service income increased by 59.3% from RMB423 million in the fourth quarter of 2021 to RMB674 million in the fourth quarter of 2022. The increase was primarily driven by the increase in transaction volume in the fourth quarter of 2022.

Cost of sales increased by 41.9% from RMB463 million in the fourth quarter of 2021 to RMB657 million in the fourth quarter of 2022, which was consistent with the increase in installment e-commerce platform service income.

Funding cost increased by 49.0% from RMB98.2 million in the fourth quarter of 2021 to RMB146 million in the fourth quarter of 2022, which was consistent with the increase in funding debts to fund the on-balance sheet loans.

Processing and servicing costs was RMB467 million in the fourth quarter of 2022, as compared with RMB469 million in the fourth quarter of 2021.

Provision for financing receivables was a loss of RMB147 million for the fourth quarter of 2022, as compared with a reversal of RMB98.9 million for the fourth quarter of 2021. The credit losses reflect the most recent performance in relation to the Company’s on-balance sheet loans and the Company's continued implementation of prudent credit assessment and risk management policies and procedures.

 

Page 4 of 15


 

Provision for contract assets and receivables was RMB131 million in the fourth quarter of 2022, as compared to RMB44.6 million in the fourth quarter of 2021. The increase was primarily due to the significant increase in loan facilitations and servicing fees in the fourth quarter of 2022.

Provision for contingent guarantee liabilities was RMB459 million in the fourth quarter of 2022, as compared to RMB11.8 million in the fourth quarter of 2021. The increase was primarily due to the increase in loan origination of the off-balance sheet loans funded by certain institutional funding partners, which are accounted for under ASC 460, Guarantees.

Gross profit decreased by 13.9% from RMB1,212 million in the fourth quarter of 2021 to RMB1,043 million in the fourth quarter of 2022.

Sales and marketing expenses increased by 29.1% from RMB328 million in the fourth quarter of 2021 to RMB423 million in the fourth quarter of 2022. This increase was primarily due to an increase in online advertising costs.

Research and development expenses decreased by 17.1% from RMB164 million in the fourth quarter of 2021 to RMB136 million in the fourth quarter of 2022, as a result of the Company’s improved efficiency.

General and administrative expenses decreased by 17.9% from RMB118 million in the fourth quarter of 2021 to RMB97.1 million in the fourth quarter of 2022, as a result of the Company’s expense control measures.

Change in fair value of financial guarantee derivatives and loans at fair value was a gain of RMB33.2 million in the fourth quarter of 2022, as compared to a loss of RMB341 million in the fourth quarter of 2021. The change in fair value was primarily driven by the fair value gains realized as a result of the release of guarantee obligation, along with the re-measurement of the expected loss rates and changes in the balances of the underlying outstanding off-balance sheet loans as of December 31, 2022.

Income tax expense increased by 53.5% from RMB47.1 million in the fourth quarter of 2021 to RMB72.3 million in the fourth quarter of 2022. The increase in income tax expense was consistent with the increase in the taxable income in the fourth quarter of 2022.

Net income increased by 17.9% from RMB256 million in the fourth quarter of 2021 to RMB301 million in fourth quarter of 2022.

 

Page 5 of 15


 

Full Year 2022 Financial Results:

Operating revenue decreased by 13.3% from RMB11,381 million in 2021 to RMB9,866 million in 2022.

Credit facilitation service income decreased by 14.3% from RMB6,956 million in 2021 to RMB5,964 million in 2022. The decrease was primarily due to the decrease in loan facilitation and servicing fees-credit oriented and partially offset by the increase in financing income and guarantee income.

Loan facilitation and servicing fees-credit oriented decreased by 44.1% from RMB4,448 million in 2021 to RMB2,487 million in 2022. The decrease was primarily due to the increase of guarantee obligation, which resulted in the decrease in considerations for revenue recognition.

Guarantee income increased by 87.6% from RMB775 million in 2021 to RMB1,453 million in 2022. The increase was primarily driven by the increase in loan origination and the increase in outstanding balances of off-balance sheet loans funded by certain institutional funding partners, which are accounted for under ASC 460, Guarantees.

 

Financing income increased by 16.8% from RMB1,733 million in 2021 to RMB2,024 million in 2022. The increase was primarily driven by the increase in the origination of on-balance sheet loans in 2022.

 

Tech-empowerment service income decreased by 33.2% from RMB2,763 million in 2021 to RMB1,846 million in 2022. The decrease was primarily due to the decrease of loan facilitation volume through the profit-sharing model within tech-empowerment service in 2022.

 

Installment e-commerce platform service income increased by 23.7% from RMB1,662 million in 2021 to RMB2,056 million in 2022. The increase was primarily driven by the increase in transaction volume in 2022.

Cost of sales increased by 17.4% from RMB1,760 million in 2021 to RMB2,067 million in 2022, which was consistent with the increase of installment e-commerce platform service income.

Funding cost increased by 13.2% from RMB458 million in 2021 to RMB518 million in 2022, which was consistent with the increase in funding debts to fund the on-balance sheet loans.

Processing and servicing costs was RMB1,875 million in 2022, as compared with RMB1,859 million in 2021.

Provision for financing receivables increased by 9.1% from RMB401 million in 2021 to RMB437 million in 2022. The credit losses reflect the most recent performance in relation to the Company’s on-balance sheet loans, and the Company's continued implementation of prudent credit assessment, and risk management policies and procedures.

 

Page 6 of 15


 

Provision for contract assets and receivables decreased by 12.4% from RMB531 million in 2021 to RMB465 million in 2022. The decrease was primarily driven by the decrease in loan facilitations and servicing fees in 2022.

Provision for contingent guarantee liabilities was RMB1,468 million in 2022, as compared to RMB622 million in 2021. The increase was primarily due to the increase in loan origination of the off-balance sheet loans funded by certain institutional funding partners, which are accounted for under ASC 460, Guarantees.

Gross profit decreased by 47.2% from RMB5,749 million in 2021 to RMB3,035 million in 2022.

Sales and marketing expenses was RMB1,685 million in 2022, as compared with RMB1,659 million in 2021.

Research and development expenses increased by 6.2% from RMB549 million in 2021 to RMB583 million in 2022. This increase was primarily due to an increase in salaries and personnel related costs.

General and administrative expenses decreased by 8.3% from RMB471 million in 2021 to RMB432 million in 2022, as a result of the Company’s expense control measures.

Change in fair value of financial guarantee derivatives and loans at fair value was a gain of RMB722 million in 2022, as compared to a loss of RMB347 million in 2021. The change in fair value was primarily driven by the fair value gains realized as a result of the release of guarantee obligation, along with the re-measurement of the expected loss rates and changes in the balances of the underlying outstanding off-balance sheet loans as of December 31, 2022.

Income tax expense decreased by 53.5% from RMB435 million in 2021 to RMB203 million in 2022. The decrease in income tax expense was consistent with the decrease in taxable income in 2022.

Net income decreased by 64.6% from RMB2,334 million in 2021 to RMB826 million in 2022.

 

Recent Developments
 

Update on Share Repurchase Program
 

On March 16, 2022, the Company’s board of directors authorized a share repurchase program under which the Company could repurchase up to an aggregate of US$50 million of its shares/ADSs over the next twelve months. As of December 31, 2022, the Company had repurchased approximately 22 million ADSs for approximately US$48 million under this repurchase program, in aggregate.
 

On November 17, 2022, the Company’s board of directors authorized a new share repurchase program under which the Company could purchase up to an aggregate of US$20 million of its shares/ADSs over the next twelve months.


Amendment of 2019 PAG Convertible Notes

On March 13, 2023, the Company entered into an amendment agreement with PAGAC Lemongrass Holding I Limited (the “Holder”) regarding previous documents governing the convertible notes in an aggregate principal amount of US$300 million sold to the Holder in September 2019 (the “Notes”). The Notes shall be paid in full by April 2024 in 14 monthly installments. The agreement has replaced the Holder’s right to require the Company to repurchase for cash all or any portion of the Notes in September 2023. The Notes remain convertible into fully paid Class A ordinary shares of the Company or ADSs at a conversion price of US$14 per ADS at the Holder’s option.

 

 

Page 7 of 15


 

Outlook
 

Based on the Company’s preliminary assessment of the current market conditions, total loan originations for the first quarter of the fiscal year 2023 are expected to be around RMB60 billion, representing an increase of approximately 39% on a year-over-year basis.

These estimates reflect the Company's current expectation, which is subject to change.

 

Conference Call

The Company’s management will host an earnings conference call at 9:30 PM U.S. Eastern time on March 13, 2023 (9:30 AM Beijing/Hong Kong time on March 14, 2023).
 

Participants who wish to join the conference call should register online at:

https://register.vevent.com/register/BIb5710f11eb26471b8fee5b57b3ad5060
 

Once registration is completed, each participant will receive the dial-in number and a unique access PIN for the conference call.
 

Participants joining the conference call should dial in at least 10 minutes before the scheduled start time.
 

A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.lexin.com.

 

About LexinFintech Holdings Ltd.

We are a leading credit technology-empowered personal financial service enabler. Our mission is to use technology and risk management expertise to make financing more accessible for young generation consumers. We strive to achieve this mission by connecting consumers with financial institutions, where we facilitate through a unique model that includes online and offline channels, installment consumption platform, big data and AI driven credit risk management capabilities, as well as smart user and loan management systems. We also empower financial institutions by providing cutting-edge proprietary technology solutions to meet their needs of financial digital transformation.


 

For more information, please visit http://ir.lexin.com.

To follow us on Twitter, please go to: https://twitter.com/LexinFintech.

Page 8 of 15


 

Use of Non-GAAP Financial Measures Statement

In evaluating our business, we consider and use adjusted net income attributable to ordinary shareholders of the Company, non-GAAP EBIT, adjusted net income per ordinary share and per ADS attributable to ordinary shareholders of the Company, four non-GAAP measures, as supplemental measures to review and assess our operating performance. The presentation of the non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. We define adjusted net income attributable to ordinary shareholders of the Company as net income attributable to ordinary shareholders of the Company excluding share-based compensation expenses, interest expense associated with convertible notes, and investment loss and we define non-GAAP EBIT as net income excluding income tax expense, share-based compensation expenses, interest expense, net, and investment loss.

We present these non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. Adjusted net income attributable to ordinary shareholders of the Company enables our management to assess our operating results without considering the impact of share-based compensation expenses, interest expense associated with convertible notes, and investment loss. Non-GAAP EBIT, on the other hand, enables our management to assess our operating results without considering the impact of income tax expense, share-based compensation expenses, interest expense, net, and investment loss. We also believe that the use of these non-GAAP financial measures facilitates investors’ assessment of our operating performance. These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP.

These non-GAAP financial measures have limitations as an analytical tool. One of the key limitations of using adjusted net income attributable to ordinary shareholders of the Company and non-GAAP EBIT is that they do not reflect all items of income and expense that affect our operations. Share-based compensation expenses, interest expense associated with convertible notes, income tax expense, interest expense, net, and investment loss have been and may continue to be incurred in our business and are not reflected in the presentation of adjusted net income attributable to ordinary shareholders of the Company and non-GAAP EBIT. Further, these non-GAAP financial measures may differ from the non-GAAP financial information used by other companies, including peer companies, and therefore their comparability may be limited.

We compensate for these limitations by reconciling each of the non-GAAP financial measures to the most directly comparable U.S. GAAP financial measure, which should be considered when evaluating our performance. We encourage you to review our financial information in its entirety and not rely on a single financial measure.

Exchange Rate Information Statement

This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the rate of RMB6.8972 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Federal Reserve Board on December 30, 2022. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

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. Statements that are not historical facts, including statements about Lexin’s beliefs and expectations, are forward-looking statements. 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 expectation of its collection efficiency and delinquency, business outlook and quotations from management in this announcement, contain forward-looking statements. Lexin 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

Page 9 of 15


 

and other written materials and in oral statements made by its officers, directors or employees to third parties. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Lexin’s goal and strategies; Lexin’s expansion plans; Lexin’s future business development, financial condition and results of operations; Lexin’s expectation regarding demand for, and market acceptance of, its credit and investment management products; Lexin’s expectations regarding keeping and strengthening its relationship with borrowers, institutional funding partners, merchandise suppliers and other parties it collaborates with; general economic and business conditions; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Lexin’s filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Lexin does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

For investor and media inquiries, please contact:

LexinFintech Holdings Ltd.

IR inquiries:

Jamie Wang

Tel: +86 (755) 3637-8888 ext. 6258

E-mail: jamiewang@lexin.com

 

Media inquiries:

Limin Chen

Tel: +86 (755) 3637-8888 ext. 6993

E-mail: liminchen@lexin.com

SOURCE LexinFintech Holdings Ltd.

 

Page 10 of 15


 

LexinFintech Holdings Ltd.

Unaudited Condensed Consolidated Balance Sheets

 

As of

 

(In thousands)

December 31, 2021

 

December 31, 2022

 

 

RMB

 

RMB

 

US$

 

ASSETS

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash and cash equivalents

 

2,664,132

 

 

1,494,150

 

 

216,631

 

Restricted cash

 

1,305,435

 

 

1,267,512

 

 

183,772

 

Restricted term deposit and short-term investments

 

1,745,898

 

 

1,331,858

 

 

193,101

 

Short-term financing receivables, net(1)(2)

 

3,826,488

 

 

6,397,920

 

 

927,611

 

Short-term contract assets and receivables, net(1)(2)

 

4,486,649

 

 

3,894,175

 

 

564,602

 

Deposits to insurance companies and guarantee companies

 

1,378,489

 

 

2,249,022

 

 

326,078

 

Prepayments and other current assets(2)

 

1,194,120

 

 

1,086,952

 

 

157,593

 

Amounts due from related parties

 

6,337

 

 

6,602

 

 

957

 

Inventories, net

 

47,816

 

 

53,917

 

 

7,817

 

Total Current Assets

 

16,655,364

 

 

17,782,108

 

 

2,578,162

 

Non-current Assets

 

 

 

 

 

 

Restricted cash

 

149,247

 

 

168,521

 

 

24,433

 

Long-term financing receivables, net(1)

 

241,127

 

 

460,325

 

 

66,741

 

Long-term contract assets and receivables, net(1)(2)

 

346,234

 

 

605,051

 

 

87,724

 

Property, equipment and software, net

 

195,330

 

 

284,593

 

 

41,262

 

Land use rights, net

 

966,067

 

 

931,667

 

 

135,079

 

Long‑term investments

 

469,064

 

 

348,376

 

 

50,510

 

Deferred tax assets

 

1,176,878

 

 

1,141,761

 

 

165,540

 

Other assets

 

826,883

 

 

1,048,301

 

 

151,989

 

Total Non-current Assets

 

4,370,830

 

 

4,988,595

 

 

723,278

 

TOTAL ASSETS

 

21,026,194

 

 

22,770,703

 

 

3,301,440

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

15,705

 

 

25,970

 

 

3,765

 

Amounts due to related parties

 

23,102

 

 

4,669

 

 

677

 

Short‑term borrowings

 

1,799,741

 

 

1,168,046

 

 

169,351

 

Short‑term funding debts

 

3,101,381

 

 

4,385,253

 

 

635,802

 

Deferred guarantee income

 

419,843

 

 

894,858

 

 

129,742

 

Contingent guarantee liabilities

 

928,840

 

 

882,107

 

 

127,893

 

Accruals and other current liabilities(2)

 

3,898,508

 

 

3,057,469

 

 

443,291

 

Convertible notes

 

-

 

 

2,063,545

 

 

299,186

 

Total Current Liabilities

 

10,187,120

 

 

12,481,917

 

 

1,809,707

 

Non-current Liabilities

 

 

 

 

 

 

Long-term borrowings

 

-

 

 

150,430

 

 

21,810

 

Long‑term funding debts

 

696,852

 

 

1,334,105

 

 

193,427

 

Deferred tax liabilities

 

54,335

 

 

52,559

 

 

7,620

 

Convertible notes

 

1,882,689

 

 

-

 

 

-

 

Other long-term liabilities

 

137,389

 

 

102,941

 

 

14,925

 

Total Non-current Liabilities

 

2,771,265

 

 

1,640,035

 

 

237,782

 

TOTAL LIABILITIES

 

12,958,385

 

 

14,121,952

 

 

2,047,489

 

Shareholders’ equity:

 

 

 

 

 

 

Class A Ordinary Shares

 

180

 

 

191

 

 

29

 

Class B Ordinary Shares

 

57

 

 

47

 

 

8

 

Treasury stock

 

-

 

 

(328,764

)

 

(47,666

)

Additional paid-in capital

 

2,918,993

 

 

3,081,254

 

 

446,740

 

Statutory reserves

 

901,322

 

 

1,022,592

 

 

148,262

 

Accumulated other comprehensive loss/(income)

 

11,273

 

 

(20,842

)

 

(3,022

)

Retained earnings

 

4,195,791

 

 

4,894,273

 

 

709,600

 

Non-controlling interests

 

40,193

 

 

-

 

 

-

 

Total shareholders’ equity

 

8,067,809

 

 

8,648,751

 

 

1,253,951

 

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

 

21,026,194

 

 

22,770,703

 

 

3,301,440

 

__________________________

(1) Short-term financing receivables, net of allowance for credit losses of RMB308,708 and RMB184,187 as of December 31, 2021 and December 31, 2022, respectively
 

Short-term contract assets and receivables, net of allowance for credit losses of RMB208,267 and RMB216,850 as of December 31, 2021 and December 31, 2022, respectively
 

Long-term financing receivables, net of allowance for credit losses of RMB19,523 and RMB13,220 as of December 31, 2021 and December 31, 2022, respectively
 

Long-term contract assets and receivables, net of allowance for credit losses of RMB39,034 and RMB52,742 as of December 31, 2021 and December 31, 2022, respectively
 

 

Page 11 of 15


 

(2) Starting from the fourth quarter of 2022, we updated the presentation of our Condensed Consolidated Balance Sheets, to provide more relevant and clear information. We also revised the presentation in comparative periods to conform to the current classification.
 

Accrued interest receivable is included in Short-term financing receivables.
 

Guarantee receivables and Contract assets and service fees receivable are combined as Contract assets and receivables.
 

Prepaid expenses and other current assets and Loan at fair value are combined as Prepayments and other current assets.
 

Accrued interest payable and Accrued expenses and other current liabilities are combined as Accruals and other current liabilities.

 

Page 12 of 15


 

LexinFintech Holdings Ltd.

Unaudited Condensed Consolidated Statements of Operations

 

For the Three Months Ended December 31,

 

 

For the Year Ended December 31,

 

(In thousands, except for share and per share data)

2021

 

2022

 

 

2021

 

2022

 

 

RMB

 

RMB

 

US$

 

 

RMB

 

RMB

 

US$

 

Operating revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit facilitation service income(3)

 

1,145,307

 

 

1,963,503

 

 

284,681

 

 

 

6,955,810

 

 

5,963,803

 

 

864,670

 

Loan facilitation and servicing fees-credit oriented

 

606,029

 

 

849,240

 

 

123,128

 

 

 

4,448,344

 

 

2,486,527

 

 

360,513

 

Guarantee income

 

171,848

 

 

499,662

 

 

72,444

 

 

 

774,544

 

 

1,453,180

 

 

210,691

 

Financing income(3)

 

367,430

 

 

614,601

 

 

89,109

 

 

 

1,732,922

 

 

2,024,096

 

 

293,466

 

Tech-empowerment service income(3)

 

630,924

 

 

412,769

 

 

59,846

 

 

 

2,762,995

 

 

1,845,943

 

 

267,637

 

Installment e-commerce platform service income(3)

 

422,980

 

 

673,994

 

 

97,720

 

 

 

1,661,720

 

 

2,056,065

 

 

298,101

 

Total operating revenue

 

2,199,211

 

 

3,050,266

 

 

442,247

 

 

 

11,380,525

 

 

9,865,811

 

 

1,430,408

 

Operating cost

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

(462,523

)

 

(656,539

)

 

(95,189

)

 

 

(1,759,956

)

 

(2,066,804

)

 

(299,658

)

Funding cost

 

(98,222

)

 

(146,375

)

 

(21,222

)

 

 

(457,615

)

 

(518,069

)

 

(75,113

)

Processing and servicing cost

 

(468,657

)

 

(466,935

)

 

(67,699

)

 

 

(1,858,901

)

 

(1,875,292

)

 

(271,892

)

Provision for financing receivables

 

98,873

 

 

(146,515

)

 

(21,243

)

 

 

(401,104

)

 

(437,477

)

 

(63,428

)

Provision for contract assets and receivables

 

(44,644

)

 

(131,292

)

 

(19,036

)

 

 

(531,237

)

 

(465,188

)

 

(67,446

)

Provision for contingent guarantee liabilities

 

(11,780

)

 

(459,252

)

 

(66,585

)

 

 

(622,438

)

 

(1,468,265

)

 

(212,878

)

Total operating cost

 

(986,953

)

 

(2,006,908

)

 

(290,974

)

 

 

(5,631,251

)

 

(6,831,095

)

 

(990,415

)

Gross profit

 

1,212,258

 

 

1,043,358

 

 

151,273

 

 

 

5,749,274

 

 

3,034,716

 

 

439,993

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing expenses

 

(327,652

)

 

(422,997

)

 

(61,329

)

 

 

(1,658,904

)

 

(1,685,438

)

 

(244,366

)

Research and development expenses

 

(163,636

)

 

(135,665

)

 

(19,670

)

 

 

(549,286

)

 

(583,260

)

 

(84,565

)

General and administrative expenses

 

(118,248

)

 

(97,058

)

 

(14,072

)

 

 

(470,661

)

 

(431,571

)

 

(62,572

)

Total operating expenses

 

(609,536

)

 

(655,720

)

 

(95,071

)

 

 

(2,678,851

)

 

(2,700,269

)

 

(391,503

)

Change in fair value of financial guarantee derivatives and loans at fair value

 

(340,728

)

 

33,185

 

 

4,811

 

 

 

(347,084

)

 

722,381

 

 

104,735

 

Interest expense, net

 

(12,752

)

 

(8,187

)

 

(1,187

)

 

 

(63,125

)

 

(55,636

)

 

(8,066

)

Investment loss

 

(107

)

 

(38,423

)

 

(5,571

)

 

 

(4,160

)

 

(33,944

)

 

(4,921

)

Other, net

 

53,591

 

 

(608

)

 

(88

)

 

 

113,480

 

 

61,321

 

 

8,891

 

Income before income tax expense

 

302,726

 

 

373,605

 

 

54,167

 

 

 

2,769,534

 

 

1,028,569

 

 

149,129

 

Income tax expense

 

(47,115

)

 

(72,302

)

 

(10,483

)

 

 

(435,418

)

 

(202,640

)

 

(29,380

)

 Net income

 

255,611

 

 

301,303

 

 

43,684

 

 

 

2,334,116

 

 

825,929

 

 

119,749

 

Less: net (loss)/income attributable to non-controlling interests

 

(423

)

 

(113

)

 

(16

)

 

 

193

 

 

6,177

 

 

896

 

Net income attributable to ordinary shareholders of the Company

 

256,034

 

 

301,416

 

 

43,700

 

 

 

2,333,923

 

 

819,752

 

 

118,853

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per ordinary share attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

0.69

 

 

0.92

 

 

0.13

 

 

 

6.33

 

 

2.36

 

 

0.34

 

Diluted

 

0.65

 

 

0.84

 

 

0.12

 

 

 

5.73

 

 

2.21

 

 

0.32

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per ADS attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

1.39

 

 

1.84

 

 

0.27

 

 

 

12.67

 

 

4.71

 

 

0.68

 

Diluted

 

1.29

 

 

1.68

 

 

0.24

 

 

 

11.46

 

 

4.41

 

 

0.64

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average ordinary shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

369,328,311

 

 

328,034,709

 

 

328,034,709

 

 

 

368,460,867

 

 

348,048,245

 

 

348,048,245

 

Diluted

 

414,080,634

 

 

372,659,684

 

 

372,659,684

 

 

 

414,992,716

 

 

392,756,821

 

 

392,756,821

 

__________________________

(3) Starting from the fourth quarter of 2022, we updated the descriptions of three categories of our revenue streams as Credit facilitation service income, Tech-empowerment service income, and Installment e-commerce platform service income, to provide more relevant and clear information. We also revised the revenue presentation in comparative periods to conform to the current classification.
 

Credit facilitation service income was previously reported as “Credit-Driven Platform Services” before the change of presentation.
 

Financing income was previously reported as “Interest and financial services income and other revenues” before the change of presentation.
 

Tech-empowerment service income was previously reported as “Technology-Driven Platform Services” before the change of presentation.
 

Installment e-commerce platform service income was previously reported as “New consumption-driven, location-based services” before the change of presentation.





 

 

 

Page 13 of 15


 

LexinFintech Holdings Ltd.

Unaudited Condensed Consolidated Statements of Comprehensive Income

 

 

For the Three Months Ended December 31,

 

 

For the Year Ended December 31,

 

(In thousands)

2021

 

2022

 

 

2021

 

2022

 

 

RMB

 

RMB

 

US$

 

 

RMB

 

RMB

 

US$

 

Net income

 

255,611

 

 

301,303

 

 

43,684

 

 

 

2,334,116

 

 

825,929

 

 

119,749

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment, net of nil tax

 

5,668

 

 

12,662

 

 

1,836

 

 

 

7,965

 

 

(32,115

)

 

(4,656

)

Total comprehensive income

 

261,279

 

 

313,965

 

 

45,520

 

 

 

2,342,081

 

 

793,814

 

 

115,093

 

Less: net (loss)/income attributable to non-controlling interests

 

(423

)

 

(113

)

 

(16

)

 

 

193

 

 

6,177

 

 

896

 

Total comprehensive income attributable to ordinary shareholders of the Company

 

261,702

 

 

314,078

 

 

45,536

 

 

 

2,341,888

 

 

787,637

 

 

114,197

 

 

Page 14 of 15


 

LexinFintech Holdings Ltd.

Unaudited Reconciliations of GAAP and Non-GAAP Results

 

 

For the Three Months Ended September 30,

 

 

For the Year Ended December 31,

 

(In thousands, except for share and per share data)

2021

 

2022

 

 

2021

 

2022

 

 

RMB

 

RMB

 

US$

 

 

RMB

 

RMB

 

US$

 

Reconciliation of Adjusted net income attributable to ordinary shareholders of the Company to Net income attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to ordinary shareholders of the Company

 

256,034

 

 

301,416

 

 

43,700

 

 

 

2,333,923

 

 

819,752

 

 

118,853

 

Add: Share-based compensation expenses

 

48,039

 

 

36,539

 

 

5,298

 

 

 

187,884

 

 

156,320

 

 

22,664

 

Interest expense associated with convertible notes

 

11,190

 

 

12,449

 

 

1,805

 

 

 

44,865

 

 

46,903

 

 

6,800

 

Investment loss

 

107

 

 

38,423

 

 

5,571

 

 

 

4,160

 

 

33,944

 

 

4,921

 

Tax effects on Non-GAAP adjustments (4)

 

-

 

 

1,231

 

 

178

 

 

 

7,151

 

 

1,231

 

 

178

 

Adjusted net income attributable to ordinary shareholders of the Company

 

315,370

 

 

390,058

 

 

56,552

 

 

 

2,577,983

 

 

1,058,150

 

 

153,416

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income per ordinary share attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

0.85

 

 

1.19

 

 

0.17

 

 

 

7.00

 

 

3.04

 

 

0.44

 

Diluted

 

0.76

 

 

1.05

 

 

0.15

 

 

 

6.21

 

 

2.69

 

 

0.39

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income per ADS attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

1.71

 

 

2.38

 

 

0.34

 

 

 

13.99

 

 

6.08

 

 

0.88

 

Diluted

 

1.52

 

 

2.09

 

 

0.30

 

 

 

12.42

 

 

5.39

 

 

0.78

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of ordinary shares outstanding attributable to ordinary shareholders of the Company

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

369,328,311

 

 

328,034,709

 

 

328,034,709

 

 

 

368,460,867

 

 

348,048,245

 

 

348,048,245

 

Diluted

 

414,080,634

 

 

372,659,684

 

 

372,659,684

 

 

 

414,992,716

 

 

392,756,821

 

 

392,756,821

 

__________________________

(4) To exclude the tax effects related to the investment loss

 

LexinFintech Holdings Ltd.

Unaudited Reconciliations of GAAP and Non-GAAP Results

 

For the Three Months Ended December 31,

 

 

For the Year Ended December 31,

 

(In thousands)

2021

 

2022

 

 

2021

 

2022

 

 

RMB

 

RMB

 

US$

 

 

RMB

 

RMB

 

US$

 

Reconciliations of Non-GAAP EBIT to Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

255,611

 

 

301,303

 

 

43,684