China-based fintech platform FinVolution Group announced a new share repurchase program.
Effective 24 August, the board of directors of the company approved a repurchase of the company’s own Class A ordinary shares in the form of American depositary shares (“ADS”) with an aggregate value of up to $60 million until 31 December 2021.
Feng Zhang, Chief Executive Officer of FinVolution stated:
FinVolution remains firmly committed to shareholder value, and since the initial launch in 2018 of our original share repurchase program of up to US$120 million, we have cumulatively deployed approximately US$111 million to purchase the Company’s ADS as of August 24, 2020. This New Program serves as an expansion of our share buyback efforts, bringing the total cumulative amount of capital for share repurchase up to US$180 million. It further reflects our confidence in the Company’s business operations and outlook, as well as our firm commitment to generating long-term value for our shareholders.
FinVolution was established in 2007 and since then has developed technologies in the online consumer finance industry. The platform features an automated loan transaction process. As of 30 June 2020, the FinVolution has registered more than 110.4 million cumulative users.
FinVolution also reported its unaudited financial results for the second quarter of the year which ended on 30 June 2020.
Net revenue grew by 10.3% to RMB 1,810.5 million ($256.3 million) from RMB 1,641.9 million in the same period during the previous year.
Operating profit reached RMB 567.2 million ($80.3 million), 26.1% down from RMB 767.6 million in the Q2 of 2019.
Non-GAAP adjusted operating profit, excluding share-based compensation expenses before tax, reached RMB 575.9 million ($81.5 million), 26.1% down from RMB 779.4 million in the Q2 of 2019.
Feng Zhang commented:
We are pleased to report healthy and solid results for the second quarter of 2020, thanks to the timely measures we adopted in response to the pandemic outbreak, the subsequent gradual economic recovery in China since the beginning of the second quarter, and our unwavering focus on comprehensive credit risk controls.
As part of our strategy to leverage our technology capabilities to enable new businesses in the financial services industry, we recently launched LY Fortune, our new wealth management initiative. LY Fortune will leverage our technology, our growing relationships with financial institutions and our extensive experience and know-how in serving retail investors. We see tremendous opportunities in the technology-enabled wealth management market in China.
Simon Ho, the Chief Financial Officer of FinVolution said:
In the second quarter, despite the continued challenging operating environment brought upon by the COVID-19, we delivered non-GAAP operating profit of RMB575.9 million representing an increase of 24.2% quarter-on-quarter, further demonstrating the sustained profitability of our core business model. Our balance sheet and liquidity remain strong with RMB3.4 billion of cash and short-term liquidity. Harnessing our strong technology, we are actively exploring and grasping new opportunities with further expanded and deepened relationships with business partners.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.