SHANGHAI, May 9, 2012 /PRNewswire-Asia/ -- Noah Holdings
Limited ("Noah" or the "Company") (NYSE: NOAH), the leading
independent service provider focusing on distributing wealth
management products to the high net worth population in
China, today announced its
unaudited financial results for the first quarter of 2012.
FIRST QUARTER 2012 FINANCIAL HIGHLIGHTS
- Net revenues in the first quarter of 2012
were US$16.8 million, a 10.8%
increase from the corresponding period in 2011.
- Income from operations in the first quarter of 2012 was
US$2.6 million, a 60.2% decrease from
the corresponding period in 2011.
- Net income attributable to Noah shareholders in the
first quarter of 2012 was US$2.7
million, a 52.6% decrease from the corresponding period in
2011. Non-GAAP[1] net income attributable to Noah
shareholders in the first quarter of 2012 was US$3.7 million, a 40.5% decrease from the
corresponding period in 2011.
- Net income per basic and diluted ADS in the first
quarter of 2012 were both US$0.05.
Non-GAAP net income per diluted ADS in the first quarter of
2012 was US$0.06.
FIRST QUARTER 2012 OPERATIONAL HIGHLIGHTS
- Total number of registered clients as of March 31, 2012 increased by 61.0% year-over-year
to 29,814; this figure includes 28,924 registered individual
clients, 824 registered enterprise clients and 66 wholesale clients
that have entered into cooperation agreements with the
Company.
- Active clients[2] during the first quarter of 2012 were
952, a 44.5% increase from the corresponding period in 2011. The
aggregate value of wealth management products distributed by the
Company during the first quarter of 2012 was RMB5.3 billion (approximately US$0.8 billion)[3], a 5.7% increase from the
corresponding period in 2011. Of this aggregate value, fixed income
products accounted for 53.0%, private equity fund products
accounted for 44.4%, and securities investment funds and
investment-linked insurance products accounted for 2.6%. The
average transaction value per client[4] in the first
quarter of 2012 was RMB5.6 million
(approximately US$0.9 million), a
26.8% decrease from the corresponding period in 2011, primarily due
to changes in product mix as clients purchased more fixed income
products that have lower minimum investment amount than private
equity fund products.
- Coverage network as of March 31, 2012 included 60 branches, up from 59
branches as of December 31, 2011.
The number of relationship managers increased to 580 as of
March 31, 2012, up 59.3%
year-over-year.
Ms. Jingbo Wang, Co-founder,
Chairwoman of the Board of Directors and Chief Executive Officer,
commented, "Market environment has started to stabilize in the
first quarter and we continued to focus on implementing our
strategic initiatives to develop our mutual fund distribution
business and our offshore business. During this quarter, we
distributed several landmark products, which demonstrated yet again
the importance of understanding client's needs and product
innovation."
Mr. Tom Wu, Chief Financial
Officer, said, "We are single-mindedly committed to deliver
profitable growth for our shareholders by focusing on branch
management, training and productivity. We will endeavor to realize
economies of scale and to improve our profitability in the coming
quarters."
FIRST QUARTER 2012 FINANCIAL RESULTS
Net Revenues
Net revenues for the first quarter of 2012 were
US$16.8 million, a 10.8% increase
from the corresponding period in 2011, due to an increase in net
revenues in recurring service fees, which were offset by a decline
in net revenues in one-time commissions for the first quarter of
2012.
Net revenues from one-time commissions for the
first quarter of 2012 were US$9.2
million, a 19.0% decrease from the corresponding period in
2011. The year-over-year decrease was mainly due to lower average
commission rate for short-term fixed income products.
Net revenues from recurring service fees for the
first quarter of 2012 were US$7.6
million, a 97.8% increase from the corresponding period in
2011. The year-over-year increase was mainly due to the cumulative
effect of private equity fund and securities investment fund
products distributed previously.
Operating Margin
Operating margin for the first quarter of 2012 was 15.7%,
as compared to 43.6% for the corresponding period in 2011. The
year-over-year decrease in operating margin for the first quarter
of 2012 was primarily due to an increase in operating cost and
expenses resulting from the Company's expansions outpacing its net
revenue growth.
Operating cost and expenses for the first
quarter of 2012, including cost of revenues, selling expenses,
G&A expenses and other operating income, were US$14.1 million, a 65.7% increase from the
corresponding period in 2011.
Cost of revenues for the first quarter of 2012
totaled US$3.9 million, a 47.6%
increase from the corresponding period in 2011. The year-over-year
increase for the first quarter of 2012 was primarily due to
increases in compensation expenses paid to relationship managers
mainly as a result of the expansion of the Company's sales
force.
Selling expenses for the first quarter of 2012 were
US$6.1 million, a 79.1% increase from
the corresponding period in 2011. Selling expenses as a percentage
of net revenues for the first quarter of 2012 was 36.5%, as
compared to 22.6% for the corresponding period in 2011. The
year-over-year increase for the first quarter of 2012 was primarily
due to increases in personnel expenses, rental expenses and client
service fees as a result of the Company's network
expansions.
G&A expenses for the first quarter of 2012 were
US$4.2 million, a 67.5% increase from
the corresponding period in 2011. G&A expenses as a percentage
of net revenues for the first quarter of 2012 was 25.2%, as
compared to 16.6% for the corresponding period in 2011. The
year-over-year increase for the first quarter of 2012 was primarily
due to increases in employee compensation expenses attributable to
G&A expenses as a result of the Company's expansion.
Income Tax Expenses
Income tax expenses for the first quarter of 2012
were US$1.0 million, a 49.8% decrease
from the corresponding period in 2011. The year-over-year decrease
was primarily due to a decrease in taxable income.
Net Income
Net income attributable to Noah
shareholders for the first quarter of 2012 was
US$2.7 million, a 52.6% decrease from
the corresponding period in 2011. Net margin for the first
quarter of 2012 was 16.3%, as compared to 38.0% for the
corresponding period in 2011. Income per basic and diluted
ADS for the first quarter of 2012 were both US$0.05, as compared to US$0.10 for the corresponding period in 2011.
Non-GAAP net income attributable to Noah shareholders for
the first quarter of 2012 was US$3.7
million, a 40.5% decrease from the corresponding period in
2011. Non-GAAP net margin for the first quarter of 2012 was
21.8%, as compared to 40.6% for the corresponding period in 2011.
Non-GAAP income per diluted ADS for the first quarter of
2012 was US$0.06, as compared to
US$0.11 for the corresponding period
in 2011.
Balance Sheet and Cash Flow
As of March 31, 2012, the Company
had US$123.1 million in cash and cash
equivalents, a decrease from US$136.9
million as of December 31,
2011. In the first quarter of 2012, the Company generated
US$0.7 million in its operating
activities, received US$4.8 million
from the maturity of fixed-term deposits, invested US$18.4 million mostly in fixed income products
and used US$0.4 million to acquire
property and equipment.
2012 FORECAST
The Company estimates that non-GAAP net income attributable to
Noah shareholders for the full year 2012 is expected to be in a
range of US$30.0 million and
US$35.0 million, representing a
year-over-year increase in the range of 14.8% and 34.0%. This
estimate reflects management's current business outlook and is
subject to change.
CONFERENCE CALL
Senior management will host a conference call on Wednesday, May 9, 2012 at 8:00 pm (Eastern) / 5:00
pm (Pacific) / 8:00 am
(Hong Kong, Thursday, May 10) to discuss its first quarter
2012 financial results and recent business activity. The conference
call may be accessed by calling the following numbers:
|
Toll Free
|
Toll
|
United States
|
+1-866-519-4004
|
+1-718-354-1231
|
China
|
|
|
- Domestic
|
800-819-0121
|
|
- Domestic Mobile
|
400-620-8038
|
|
Hong Kong
|
800-93-0346
|
|
United
Kingdom
|
080-8234-6646
|
|
Conference ID
#
|
75341366
|
|
A telephone replay will be available shortly after the call
until May 16, 2012 at +1-718-354-1232
(US Local Toll) or +61-2-8235-5000 (International). Conference ID #
75341366.
A live webcast of the conference call and replay will be
available in the investor relations section of the Company's
website at http://ir.noahwm.com.
DISCUSSION OF NON-GAAP FINANCIAL MEASURES:
In addition to disclosing financial results prepared in
accordance with U.S. GAAP, the Company's earnings release contains
non-GAAP financial measures that exclude the effects of all forms
of share-based compensation. The reconciliation of these non-GAAP
financial measures to the nearest GAAP measures is set forth in the
table captioned "Reconciliation of GAAP to Non-GAAP Results"
below.
The non-GAAP financial measures disclosed by the Company should
not be considered a substitute for financial measures prepared in
accordance with U.S. GAAP. The financial results reported in
accordance with U.S. GAAP and reconciliation of GAAP to non-GAAP
results should be carefully evaluated. The non-GAAP financial
measure used by the Company may be prepared differently from and,
therefore, may not be comparable to similarly titled measures used
by other companies.
When evaluating the Company's operating performance in the
periods presented, management reviewed non-GAAP net income results
reflecting adjustments to exclude the impacts of share-based
compensation to supplement U.S. GAAP financial data. As such, the
Company believes that the presentation of the non-GAAP net income,
non-GAAP income per diluted ADS and non-GAAP net margin provides
important supplemental information to investors regarding financial
and business trends relating to the Company's financial condition
and results of operations in a manner consistent with that used by
management. Pursuant to U.S. GAAP, the Company recognized certain
amounts of expenses for the restricted shares and share options in
the periods presented and expects to incur share-based compensation
charges in the future. To make financial results comparable period
by period, the Company utilized the non-GAAP financial results to
better understand its historical business operations.
ABOUT NOAH HOLDINGS LIMITED
Noah Holdings Limited is the leading independent service
provider focusing on distributing wealth management products to the
high net worth population in China. Noah distributes over-the-counter
wealth management products that are originated in China, including primarily fixed income
products, private equity funds and securities investment funds.
With 580 relationship managers in 60 branch offices as of
March 31, 2012, Noah's total coverage
network encompasses China's most
economically developed regions where the high net worth population
is concentrated. Through this extensive coverage network, product
sophistication, and client knowledge, the Company caters to the
wealth management needs of China's
high net worth population. For more information please visit the
Company's website at http://www.noahwm.com.
SAFE HARBOR STATEMENT
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates," "confident" and similar statements. Among
other things, the outlook for the full year 2012 and quotations
from management in this announcement, as well as Noah's strategic
and operational plans, contain forward-looking statements. Noah may
also make written or oral forward-looking statements in its
periodic reports to the U.S. Securities and Exchange Commission, in
its annual report to shareholders, in press releases and other
written materials and in oral statements made by its officers,
directors or employees to third parties. Statements that are not
historical facts, including statements about Noah's beliefs and
expectations, are forward-looking statements. Forward-looking
statements involve inherent risks and uncertainties. A number of
factors could cause actual results to differ materially from those
contained in any forward-looking statement, including but not
limited to the following: our goals and strategies; our future
business development, financial condition and results of
operations; the expected growth of the wealth management market in
China and internationally; our
expectations regarding demand for and market acceptance of the
products we distribute; our expectations regarding keeping and
strengthening our relationships with key clients; relevant
government policies and regulations relating to our industry; our
ability to attract and retain quality employees; our ability to
stay abreast of market trends and technological advances; our plans
to invest in research and development to enhance our product
choices and service offerings; competition in our industry in
China and internationally; general
economic and business conditions in China; and our ability to effectively protect
our intellectual property rights and not infringe on the
intellectual property rights of others. Further information
regarding these and other risks is included in Noah's filings with
the Securities and Exchange Commission, including its annual report
on Form 20-F. Noah does not undertake any obligation to update any
forward-looking statement as a result of new information, future
events or otherwise, except as required under applicable law. All
information provided in this press release and in the attachments
is as of the date of this press release, and Noah undertakes no
duty to update such information, except as required under
applicable law.
Notes:
[1] Noah's Non-GAAP financial measures are its
corresponding GAAP financial measures as adjusted by excluding the
effects of all forms of share-based compensation.
[2] "Active clients" refers to those registered clients who
purchased wealth management products distributed by Noah during any
given period.
[3] The amount in RMB was translated into U.S. dollars using the
average rate for the period as set forth in the H.10 statistical
release of the Federal Reserve Board.
[4] "Average transaction value per client" refers to the average
value of wealth management products distributed by Noah that are
purchased by active clients during a given period.
Contact:
Noah Holdings Limited
Shang Chuang, Director of IR
Tel: +86 21 3860 2388
ir@noahwm.com
-- FINANCIAL AND OPERATIONAL TABLES FOLLOW --
Noah Holdings
Limited
|
Condensed
Consolidated Balance Sheets
|
(In U.S.
dollars)
|
(unaudited)
|
|
|
|
|
As of
|
|
|
|
|
December 31,
2011
|
|
March 31,
2012
|
|
|
|
|
$
|
|
$
|
Assets
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
136,859,336
|
|
123,121,230
|
|
|
Restricted
cash
|
|
79,442
|
|
80,668
|
|
|
Short-term
investments
|
|
20,714,145
|
|
34,825,265
|
|
|
Accounts receivable, net
of allowance for doubtful accounts of nil at December 31, 2011 and
March 31, 2012
|
|
6,233,227
|
|
11,136,087
|
|
|
Deferred tax
assets
|
|
2,898,399
|
|
2,896,785
|
|
|
Amounts due from related
parties
|
|
1,734,405
|
|
232,318
|
|
|
Other current
assets
|
|
2,192,988
|
|
3,281,884
|
|
|
Total current
assets
|
|
170,711,942
|
|
175,574,237
|
|
|
|
|
|
|
|
|
Long-term
investments
|
|
1,892,308
|
|
1,417,527
|
|
Investment in
affiliates
|
|
2,434,689
|
|
2,753,237
|
|
Property and equipment,
net
|
|
4,436,936
|
|
4,212,775
|
|
Non-current deferred tax
assets
|
|
537,988
|
|
524,697
|
|
Other non-current
assets
|
|
928,496
|
|
944,146
|
Total
Assets
|
|
180,942,359
|
|
185,426,619
|
|
|
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accrued payroll and
welfare expenses
|
|
9,477,432
|
|
6,312,786
|
|
|
Income tax
payable
|
|
1,932,895
|
|
2,425,881
|
|
|
Other current
liabilities
|
|
5,062,950
|
|
8,482,861
|
|
|
Dividend
payable
|
|
-
|
|
7,868,000
|
|
|
Uncertain tax position
liabilities
|
|
322,378
|
|
364,310
|
|
|
Total current
liabilities
|
|
16,795,655
|
|
25,453,838
|
|
|
|
|
|
|
|
|
Non-current uncertain
tax position liabilities
|
|
1,272,219
|
|
1,271,645
|
|
Other non-current
liabilities
|
|
1,854,762
|
|
1,811,085
|
|
Total
Liabilities
|
|
19,922,636
|
|
28,536,568
|
|
|
|
|
|
|
|
|
Equity
|
|
161,019,723
|
|
156,890,051
|
Total Liabilities and
Equity
|
|
180,942,359
|
|
185,426,619
|
|
|
|
|
|
|
|
|
|
Noah Holdings
Limited
|
|
Condensed
Consolidated Income Statements
|
|
(In U.S.
dollars, except for ADS data, per ADS data and
percentages)
|
|
(unaudited)
|
|
|
Three months
ended
|
|
|
|
|
March
31,
|
|
March
31,
|
|
Change
|
|
|
2011
|
|
2012
|
|
|
|
Revenues:
|
$
|
|
$
|
|
|
|
Third-party
revenues
|
14,047,759
|
|
14,521,729
|
|
3.4%
|
|
Related
party revenues
|
1,997,650
|
|
3,230,408
|
|
61.7%
|
|
Total
revenues
|
16,045,409
|
|
17,752,137
|
|
10.6%
|
|
Less:
business taxes and related surcharges
|
(897,115)
|
|
(974,968)
|
|
8.7%
|
|
Net
revenues
|
15,148,294
|
|
16,777,169
|
|
10.8%
|
|
Operating cost and
expenses:
|
|
|
|
|
|
|
Cost of
revenues
|
(2,610,173)
|
|
(3,853,533)
|
|
47.6%
|
|
Selling
expenses
|
(3,421,605)
|
|
(6,128,402)
|
|
79.1%
|
|
General and
administrative expenses
|
(2,520,014)
|
|
(4,220,228)
|
|
67.5%
|
|
Other
operating income
|
13,132
|
|
52,812
|
|
302.2%
|
|
Total operating cost and
expenses
|
(8,538,660)
|
|
(14,149,351)
|
|
65.7%
|
|
Income from
operations
|
6,609,634
|
|
2,627,818
|
|
(60.2%)
|
|
Other
income(expenses):
|
|
|
|
|
|
|
Interest
income
|
410,105
|
|
713,210
|
|
73.9%
|
|
Investment
income
|
225,780
|
|
533,026
|
|
136.1%
|
|
Foreign
exchange gain (loss)
|
550,136
|
|
(72,096)
|
|
(113.1%)
|
|
Other
income
|
46,935
|
|
28,383
|
|
(39.5%)
|
|
Total other
income
|
1,232,956
|
|
1,202,523
|
|
(2.5%)
|
|
Income before taxes and
loss from equity in affiliates
|
7,842,590
|
|
3,830,341
|
|
(51.2%)
|
|
Income tax
expense
|
(2,075,150)
|
|
(1,041,470)
|
|
(49.8%)
|
|
Loss from equity in
affiliates
|
(4,375)
|
|
(55,561)
|
|
1,170.0%
|
|
Net income
attributable to Noah Shareholders
|
5,763,065
|
|
2,733,310
|
|
(52.6%)
|
|
|
|
|
|
|
|
|
Income per ADS,
basic
|
0.10
|
|
0.05
|
|
(50.0%)
|
|
Income per ADS,
diluted
|
0.10
|
|
0.05
|
|
(50.0%)
|
|
|
|
|
|
|
|
|
Other comprehensive
income, net of tax:
|
|
|
|
|
|
|
Foreign currency translation adjustments
|
236,908
|
|
(29,754)
|
|
(112.6%)
|
|
Comprehensive income
attributable to Noah Shareholders
|
5,999,973
|
|
2,703,556
|
|
(54.9%)
|
|
|
|
|
|
|
|
|
Margin
analysis:
|
|
|
|
|
|
|
Operating
margin
|
43.6%
|
|
15.7%
|
|
|
|
Net margin
|
38.0%
|
|
16.3%
|
|
|
|
Weighted average ADS
equivalent: [1]
|
|
|
|
|
|
|
Basic
|
55,676,667
|
|
55,940,872
|
|
|
|
Diluted
|
57,126,675
|
|
56,674,694
|
|
|
|
ADS equivalent
outstanding at end of period
|
55,735,000
|
|
55,972,765
|
|
|
[1] Assumes all
outstanding ordinary shares are represented by ADSs. Each ordinary
share represents two ADSs
|
|
|
Noah Holdings
Limited
|
Supplemental
Information
|
(unaudited)
|
|
As
of
|
|
Change
|
|
March 31,
2011
|
|
March 31,
2012
|
|
|
|
|
|
|
|
Number of
registered clients
|
18,521
|
|
29,814
|
|
61.0%
|
Number of
relationship managers
|
364
|
|
580
|
|
59.3%
|
Number of branch
offices
|
39
|
|
60
|
|
53.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Change
|
|
March 31,
2011
|
|
March 31,
2012
|
|
|
(in millions of RMB,
except number of active clients and percentages)
|
Number of active
clients
|
659
|
|
952
|
|
44.5%
|
Transaction
value:
|
|
|
|
|
|
Fixed income products
|
1,695
|
|
2,819
|
|
66.3%
|
Private equity fund products
|
2,523
|
|
2,362
|
|
(6.4%)
|
Securities investment funds and investment-linked insurance
products
|
815
|
|
137
|
|
(83.2%)
|
Total transaction
value
|
5,033
|
|
5,318
|
|
5.7%
|
Average
transaction value per client
|
7.64
|
|
5.59
|
|
(26.9%)
|
Noah Holdings
Limited
|
Reconciliation
of GAAP to Non-GAAP Results
|
(In U.S.
dollars, except for ADS data and percentages)
|
(unaudited)
|
|
Three months
ended
|
|
|
|
March 31,
|
|
March
31,
|
|
Change
|
|
2011
|
|
2012
|
|
|
$
|
|
$
|
|
|
Net income attributable
to Noah Shareholders
|
5,763,065
|
|
2,733,310
|
|
(52.6%)
|
Adjustment
for share-based compensation related to:
|
|
|
|
|
|
Share options
|
349,043
|
|
886,766
|
|
154.1%
|
Restricted shares
|
35,018
|
|
35,407
|
|
1.1%
|
Adjusted net income
attributable to Noah Shareholders (non-GAAP)*
|
6,147,126
|
|
3,655,483
|
|
(40.5%)
|
|
|
|
|
|
|
Net income per ADS,
diluted
|
0.10
|
|
0.05
|
|
(50.0%)
|
Adjusted net income per
ADS, diluted (non-GAAP)*
|
0.11
|
|
0.06
|
|
(41.4%)
|
|
|
|
|
|
|
Net margin
|
38.0%
|
|
16.3%
|
|
(57.1%)
|
Adjusted net margin
(non-GAAP)*
|
40.6%
|
|
21.8%
|
|
(46.3%)
|
|
*The non-GAAP
adjustments do not take into consideration the impact of taxes on
such adjustments.
|
SOURCE Noah Holdings Limited