Jupai Reports Second Quarter 2017 Results

SHANGHAI, Aug. 16, 2017 /PRNewswire/ -- Jupai Holdings Limited ("Jupai" or the "Company") (NYSE: JP), a leading third-party wealth management service provider, focusing on distributing wealth management products and providing quality product advisory services to high-net-worth individuals in China, today announced its unaudited financial results for the second quarter and six months ended June 30, 2017.

Effective July 1, 2016, Jupai changed its reporting currency from the U.S. dollars to Renminbi. The aligning of the reporting currency with the underlying operations better reflects the Company's results of operations for each period, and reduces the impact that the increased volatility of the Renminbi to U.S. dollars exchange rate will have on the Company's reported operating results. In this announcement, the unaudited financial results for the second quarter and six months ended June 30, 2017, respectively, are stated in Renminbi. This release contains translations of certain Renminbi amounts into U.S. dollars for convenience. Prior period financial results have been recast into the new reporting currency.

SECOND QUARTER AND FIRST HALF 2017 FINANCIAL HIGHLIGHTS

  • Net revenues in the second quarter of 2017 were RMB436.6 million (US$[1]64.4 million), a 78.4% increase from RMB244.7 million for the corresponding period in 2016. For the first half of 2017, net revenues were RMB805.4 million (US$118.8 million), an increase of 71.8% from RMB468.7 million for the same period in 2016.

[1] The U.S. dollars (US$) amounts disclosed in this press release, except for those transaction amounts that were actually settled in U.S. dollars, are presented solely for the convenience of the reader. The conversion of Renminbi (RMB) into U.S. dollars (US$) in this press release is based on the noon buying rate on June 30, 2017, as set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System, which was RMB6.7793 to US$1.00. The percentages stated in this press release are calculated based on the Renminbi amounts.

 

(RMB '000, except percentages)

Q2 2016


Q2 2016 %


Q2 2017


Q2 2017 %


YoY Change %

One-time commissions

148,894


60.7%


230,010


52.7%


54.5%

Recurring management fees

62,030


25.5%


93,906


21.5%


51.4%

Recurring service fees

33,807


13.8%


33,317


7.6%


-1.4%

Other service fees

-


-


79,387


18.2%


100.0%

Total net revenues

244,731


100.0%


436,620


100.0%


78.4%

 

(RMB '000, except percentages)

H1 2016


H1 2016 %


H1 2017


H1 2017 %


YoY Change %

One-time commissions

303,867


64.9%


464,768


57.7%


53.0%

Recurring management fees

98,662


21.0%


161,524


20.1%


63.7%

Recurring service fees

66,211


14.1%


59,542


7.4%


-10.1%

Other service fees

-


-


119,527


14.8%


100.0%

Total net revenues

468,740


100.0%


805,361


100.0%


71.8%

  • Income from operations in the second quarter of 2017 was RMB166.1 million (US$24.5 million), a 205.8% increase from RMB54.3 million for the corresponding period in 2016. For the first half of 2017, income from operations was RMB291.3 million (US$43.0 million), an increase of 240.1% from RMB85.7 million for the same period in 2016.
  • Net income attributable to ordinary shareholders in the second quarter of 2017 was RMB112.5 million (US$16.6 million), a 181.4% increase from RMB40.0 million for the corresponding period in 2016. For the first half of 2017, net income attributable to ordinary shareholders was RMB203.2 million (US$30.0 million), an increase of 205.7% from RMB66.5 million for the same period in 2016.
  • Non-GAAP[2] net income attributable to ordinary shareholders in the second quarter of 2017 was RMB125.5 million (US$18.5 million), a 158.4% increase from RMB48.6 million for the corresponding period in 2016. For the first half of 2017, non-GAAP net income attributable to ordinary shareholders was RMB226.7 million (US$33.4 million), an increase of 171.7% from RMB83.4 million for the same period in 2016.

[2] Jupai's non-GAAP financial measures are derived from adjusting the corresponding GAAP financial measures by excluding the effects of share-based compensation and amortization of intangible assets resulted from business acquisitions.

SECOND QUARTER AND FIRST HALF 2017 OPERATIONAL UPDATES 

  • Total number of active clients[3] during the second quarter of 2017 was 3,698.
  • The aggregate value of wealth management products distributed by the Company during the second quarter of 2017 was RMB12.3 billion (US$1.8 billion), a 50.9% increase from the corresponding period in 2016. For the first half of 2017, the aggregate value of wealth management products distributed by the Company was RMB26.5 billion (US$3.9 billion), a 39.6% increase from the corresponding period in 2016.

[3] "Active clients" for a given period refers to clients who purchase wealth management products distributed by Jupai at least once during that given period.

 

Wealth management products distributed by the Company - breakdown by product type

Three months ended

Six months ended


June 30, 2016

June 30, 2017

June 30, 2016


June 30, 2017

Product type

(RMB in millions, except percentages)

(RMB in millions, except percentages)

Fixed income products

4,778

59%

10,278

83%

9,981

53%


21,495

81%

Private equity products

2,201

27%

1,601

13%

6,260

33%


3,934

15%

Secondary market equity fund products

841

10%

72

1%

2,103

11%


92

0%

Other products

338

4%

362

3%

646

3%


990

4%

All products

8,158

100%

12,313

100%

18,990

100%


26,511

100%

  • Jupai's coverage network as of June 30, 2017 included 76 client centers covering 47 cities, up from 61 client centers covering 36 cities, as of June 30, 2016.
  • Total assets under management[4] as of June 30, 2017 were RMB48.0 billion (US$7.1 billion), a 11.3% increase from March 31, 2017 and a 85.6% increase from June 30, 2016.

[4] "Assets under management" by Jupai refers to the amount of capital contributions made by the investors to the fund without adjustment for any gain or loss from investment.

 

Assets under management – breakdown by product type


As of


June 30, 2016


June 30, 2017

Product type

(RMB in millions, except percentages)

Fixed income products

10,943

42%


26,573

56%

Private equity products

12,818

50%


18,432

38%

Secondary market equity fund products

1,366

5%


2,483

5%

Other products

711

3%


473

1%

All products

25,838

100%


47,961

100%

 

"We concluded the first half of 2017 with impressive growth on both our top and bottom lines," said Mr. Jianda Ni, Jupai's chairman of the board and chief executive officer. "Jupai's net revenues for the first half of 2017 totaled RMB805.4 million, up 71.8% year-on-year, and our net income attributable to ordinary shareholders rose significantly by 205.7% year-on-year to RMB203.2 million, reaching almost the same level as our net income attributable to ordinary shareholders for the full year 2016."

"As investors' appetite for risk remained conservative in the first half of 2017, we further enhanced Jupai's competitive advantages within the fixed-income product category. Jupai continues to provide our customers with superior fixed-income products with underlying assets in real estate, leveraging our core competence in products related to the real estate industry. We have also steadily expanded our offerings into non-real-estate fixed-income products to fulfill a wider range of client needs. In the first half of 2017, the aggregate value of products distributed by Jupai grew to RMB26.5 billion, a 39.6% increase year-on-year, and total assets under management increased to RMB48.0 billion as of June 30, 2017, an 85.6% increase year-on-year."

"Looking forward, Jupai expects to continue to develop new products and services, expand and strengthen our sales network, and increase our operating efficiency. While we believe the size of the market in China is large enough to support Jupai's growth, we will carefully evaluate potential overseas expansion opportunities. As we build Jupai into the leading wealth and asset management brand in China, the management will continue to explore ways to further enhance long-term value for our shareholders."

Ms. Min Liu, Jupai's chief financial officer, said, "Jupai continued to deliver strong results in the second quarter of 2017, with our net revenues substantially surpassing management guidance to achieve another record high. Our operating margin for the quarter rose substantially to 38.0%, up from 22.3% in the same period last year, thanks to the cost control measures which we initiated in the beginning of 2016 and the optimization of our product mix. As we further expand our business scale and enhance our operating efficiency, we remain confident in our ability to grow the bottom line while maintaining healthy margins in the long-term."

SECOND QUARTER AND FIRST HALF 2017 FINANCIAL RESULTS

Net Revenues

Net revenues for the second quarter of 2017 were RMB436.6 million (US$64.4 million), a 78.4% increase from RMB244.7 million for the corresponding period in 2016, primarily due to increases in one-time commissions, recurring management fees and other service fees. Net revenues were RMB805.4 million (US$118.8 million) for the first half of 2017, an increase of 71.8% from RMB468.7 million for the same period in 2016.

  • Net revenues from one-time commissions for the second quarter of 2017 were RMB230.0 million (US$33.9 million), a 54.5% increase from RMB148.9 million for the corresponding period in 2016, primarily as a result of an increase in the aggregate value of wealth management products distributed by the Company. For the first half of 2017, net revenues from one-time commissions were RMB464.8 million (US$68.6 million), an increase of 53.0% from RMB303.9 million for the same period in 2016.
  • Net revenues from recurring management fees for the second quarter of 2017 were RMB93.9 million (US$13.9 million), a 51.4% increase from RMB62.0 million for the corresponding period in 2016, primarily attributable to an increase in the value of assets under management. The Company recognized RMB21.8 million (US$3.2 million) and RMB1.6 million carried interest in the second quarter of 2017 and 2016, respectively. For the first half of 2017, net revenues from recurring management fees were RMB161.5 million (US$23.8 million), a 63.7% increase from RMB98.7 million for the same period in 2016. RMB23.5 million (US$3.5 million) and RMB5.1 million carried interest was recognized as part of Jupai's recurring management fees for the first half of 2017 and the same period in 2016, respectively.
  • Net revenues from recurring service fees for the second quarter of 2017 were RMB33.3 million (US$4.9 million), a 1.4% decrease from RMB33.8 million for the corresponding period in 2016. The Company recognized RMB11.4 million (US$1.7 million) and RMB3.8 million variable performance fees in the second quarter of 2017 and 2016, respectively. For the first half of 2017, net revenues from recurring service fees were RMB59.5 million (US$8.8 million), a 10.1% decrease from RMB66.2 million for the same period in 2016, primarily because the Company provided ongoing services to fewer product suppliers. The Company recognized RMB12.8 million (US$1.9 million) and RMB7.7 million variable performance fees for the first half of 2017 and the same period in 2016, respectively.
  • Net revenues from other service fees were RMB79.4 million (US$11.7 million) for the second quarter of 2017 and RMB119.5 million (US$17.6 million) for the first half of 2017, which mainly included sub-advisory fees collected from other companies.

Operating Costs and Expenses

Operating costs and expenses for the second quarter of 2017 were RMB270.5 million (US$39.9 million), an increase of 42.1% from RMB190.4 million for the corresponding period in 2016. For the first half of 2017, operating costs and expenses were RMB514.0 million (US$75.8 million), an increase of 34.2% from RMB383.1 million for the same period in 2016.

  • Cost of revenues for the second quarter of 2017 was RMB162.0 million (US$23.9 million), a 63.0% increase from RMB99.4 million for the corresponding period in 2016, primarily due to increases in the number of wealth management advisors and client managers and their average compensation. For the first half of 2017, cost of revenues was RMB296.7 million (US$43.8 million), an increase of 40.7% from RMB210.9 million for the same period in 2016.
  • Selling expenses for the second quarter of 2017 were RMB65.4 million (US$9.6 million), a 25.9% increase from RMB51.9 million for the corresponding period in 2016, primarily due to increases in marketing, advertising and brand promotion expenses. For the first half of 2017, selling expenses were RMB124.9 million (US$18.4 million), an increase of 19.7% from RMB104.3 million for the same period in 2016.
  • G&A expenses for the second quarter of 2017 were RMB45.1 million (US$6.7 million), a 15.0% increase from RMB39.2 million for the corresponding period in 2016, mainly due to increases in both the numbers of managerial and administrative personnel and their average compensation as well as increases in rental and office supply expenses. For the first half of 2017, G&A expenses were RMB97.7 million (US$14.4 million), an increase of 37.4% from RMB71.1 million for the same period in 2016.
  • Other operating income (government subsidies) received by the Company in the second quarter of 2017 was RMB1.9 million (US$0.3 million), a 1722.8% increase from RMB0.1 million for the corresponding period in 2016. For the first half of 2017, other operating income was RMB5.3 million (US$0.8 million), an increase of 64.0% from RMB3.3 million for the same period in 2016. Government subsidies were recorded when received and their availability and amount depend on government administrative policies.

Operating margin for the second quarter of 2017 was 38.0%, compared to 22.3% for the corresponding period in 2016. For the first half of 2017, operating margin was 36.2%, compared to 18.3% for the same period in 2016.

Income tax expenses for the second quarter of 2017 were RMB44.7 million (US$6.6 million), a 188.8% increase from RMB15.5 million for the corresponding period in 2016. For the first half of 2017, income tax expenses were RMB74.3 million (US$11.0 million), an increase of 206.4% from RMB24.3 million for the same period in 2016. The increase was primarily due to an increase in taxable income.

Net Income

- Net Income

  • Net income attributable to ordinary shareholders for the second quarter of 2017 was RMB112.5 million (US$16.6 million), a 181.4% increase from RMB40.0 million for the corresponding period in 2016. For the first half of 2017, net income attributable to ordinary shareholders was RMB203.2 million (US$30.0 million), an increase of 205.7% from RMB66.5 million for the same period in 2016.
  • Net margin attributable to ordinary shareholders for the second quarter of 2017 was 25.8%, as compared to 16.4% for the corresponding period in 2016. For the first half of 2017, net margin attributable to ordinary shareholders was 25.2%, compared to 14.2% for the same period in 2016.
  • Net income attributable to ordinary shareholders per basic and diluted American depositary share ("ADS") for the second quarter of 2017 was RMB3.47 (US$0.51) and RMB3.33 (US$0.49), respectively, as compared to RMB1.25 and RMB1.19, respectively, for the corresponding period in 2016. For the first half of 2017, net income attributable to ordinary shareholders per basic and diluted ADS was RMB6.28 (US$0.93) and RMB6.02 (US$0.89), respectively, as compared to RMB2.08 and RMB1.99, respectively, for the same period in 2016.

- Non-GAAP Net Income

  • Non-GAAP net income attributable to ordinary shareholders for the second quarter of 2017 was RMB125.5 million (US$18.5 million), a 158.4% increase from RMB48.6 million for the corresponding period in 2016. For the first half of 2017, non-GAAP net income attributable to ordinary shareholders was RMB226.7 million (US$33.4 million), a 171.7% increase from RMB83.4 million for the same period in 2016.
  • Non-GAAP net margin attributable to ordinary shareholders for the second quarter of 2017 was 28.7%, as compared to 19.9% for the corresponding period in 2016. For the first half of 2017, non-GAAP net margin attributable to ordinary shareholders was 28.1%, as compared to 17.8% for the same period in 2016.
  • Non-GAAP net income attributable to ordinary shareholders per diluted ADS for the second quarter of 2017 was RMB3.72 (US$0.55), as compared to RMB1.45 for the corresponding period in 2016. For the first half of 2017, non-GAAP net income attributable to ordinary shareholders per diluted ADS was RMB6.72 (US$0.99), as compared to RMB2.50 for the same period in 2016.

Balance Sheet and Cash Flow

As of June 30, 2017, the Company had RMB1,169.1 million (US$172.4 million) in cash and cash equivalents, compared to RMB1,123.2 million as of December 31, 2016.

Net cash provided by operating activities during the second quarter of 2017 was RMB61.0 million (US$9.0 million). For the first half of 2017, net cash provided by operating activities was RMB281.4 million (US$41.5 million).

Net cash used in investing activities during the second quarter of 2017 was RMB95.8 million (US$14.1 million). For the first half of 2017, net cash used in investing activities was RMB110.4 million (US$16.3 million).

Net cash used in financing activities during the second quarter of 2017 was RMB5.1 million (US$0.7 million). For the first half of 2017, net cash used in financing activities was RMB125.1 million (US$18.4 million).

BUSINESS OUTLOOK

The Company estimates that its net revenues for the third quarter of 2017 will be in the range of RMB420 million to RMB440 million, an increase of 31.1% to 37.3% compared to the same period in 2016. This forecast reflects the Company's current and preliminary view, which is subject to change.

CONFERENCE CALL

Jupai's management will host an earnings conference call on August 16, 2017 at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing/Hong Kong time).

Dial-in details for the earnings conference call are as follows:

U.S./International:

 +1-866-564-2842 or +1-323-794-2094

Hong Kong:

 800-961-105 or +852-3008-1527

Mainland China:

 400-120-9221 or 800-820-6061

Singapore

800-186-5085 or +65-6320-9075

Passcode:

8747228

Please dial in 10 minutes before the call is scheduled to begin and provide the passcode to join the call.

A replay of the conference call may be accessed by phone at the following numbers until August 23, 2017:

U.S./International:

+1-719-457-0820

Hong Kong:

800-901-108

Mainland China:

400-120-1651

Singapore

800-101-2009

Passcode:

8747228

Additionally, a live and archived webcast will be available at http://jupai.investorroom.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 and amortization of intangible assets related to acquisition. The reconciliation of these non-GAAP financial measures to the nearest GAAP measures as 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 and amortization of intangible assets related to acquisition to supplement U.S. GAAP financial data. As such, the Company believes that the presentation of the non-GAAP net income attributable to ordinary shareholders, non-GAAP net income attributable to ordinary shares per diluted ADS and non-GAAP net margin attributable to ordinary shareholders 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 significant amounts of expenses for the restricted shares and share options, and amortization of intangible assets related to acquisition in the periods presented. The Company utilized the non-GAAP financial results to make financial results comparable period to period and to better understand its historical business operations.

ABOUT JUPAI HOLDINGS LIMITED

Jupai Holdings Limited ("Jupai") (NYSE: JP) is a leading third-party wealth management service provider focusing on distributing wealth management products and providing quality product advisory services to high-net-worth individuals in China. Jupai's comprehensive and personalized client service and broad range of carefully selected third-party and self-developed products have made it a trusted brand among its clients. Jupai maintains extensive and targeted coverage of China's high-net-worth population. 

For more information, please visit http://jupai.investorroom.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 business outlook and quotations from management in this announcement, as well as Jupai's strategic and operational plans, contain forward-looking statements. Jupai 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 Jupai'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: the goals and strategies of the Company and the Company's ability to manage its growth and implement its business strategies; future business development, financial condition and results of operations of the Company; condition of the wealth management market in China and internationally; the demand for and market acceptance of the products the Company distributes; the Company's ability to maintain and further grow its active high-net-worth client base and maintain or increase the amount of investment by clients; developments in relevant government policies and regulations relating to the Company's industry and the Company's ability to comply with those policies and regulations; the Company's ability to attract and retain quality employees; the Company's ability to adapt to potential uncertainties in China's real estate industry and stay abreast of market trends and technological advances; the results of the Company's investments in research and development to enhance its product choices and service offerings; general economic and business conditions in China; the Company's ability to protect its reputation and enhance its brand recognition. Further information regarding these and other risks is included in Jupai's filings with the U.S. Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release, and Jupai does not undertake any obligation to update any such information, including forward-looking statements, as a result of new information, future events or otherwise, except as required under applicable law.

Contacts:
Jupai Holdings Limited
Harry He
Director of Investor Relations
Jupai Holdings Limited
Phone: +86 (21) 6026 9129
Email: ir@jpinvestment.cn

Philip Lisio
The Foote Group
Phone: +86 (10) 8429 9544
Email: Jupai-IR@thefootegroup.com

 

— FINANCIAL AND OPERATIONAL TABLES FOLLOW —

 

Jupai Holdings Limited

Unaudited Condensed Consolidated Balance Sheets

(In RMB)



As of


December 31,


June 30,


June 30,


2016


2017


2017


RMB


RMB


USD

Assets






Current assets:






Cash and cash equivalents

1,123,166,156


1,169,068,657


172,446,810

Short-term investments

25,210,000


72,451,600


10,687,180

Accounts receivable

52,111,944


96,490,039


14,233,039

Other receivables

71,064,287


30,337,591


4,475,033

Amounts due from related parties

133,560,483


181,515,727


26,774,995

Deferred tax assets — current[5]

55,791,373


-


-

Investments at cost method — current

-


10,000,000


1,475,078

Other current assets

12,551,186


14,940,628


2,203,860

Total current assets

1,473,455,429


1,574,804,242


232,295,995

Investments at cost method — non-current

70,450,000


63,450,000


9,359,373

Investment in affiliates

85,830,444


86,271,147


12,725,672

Advanced payment for acquisition

77,560,000


77,691,490


11,460,105

Property and equipment, net

37,199,812


41,086,418


6,060,569

Intangible assets

83,072,545


81,236,772


11,983,062

Goodwill

277,752,765


271,239,455


40,009,950

Long-term prepayment

6,261,152


10,157,753


1,498,349

Other non-current assets

7,977,534


23,506,741


3,467,429

Deferred tax assets — non-current

8,494,738


64,286,111


9,482,707

Total Assets

2,128,054,419


2,293,730,129


338,343,211







Liabilities and Equity






Current liabilities:






Accrued payroll and welfare expenses

101,864,007


90,708,260


13,380,181

Income tax payable

138,131,812


176,758,644


26,073,288

Other tax payable

58,189,283


63,089,454


9,306,190

Dividend payable

10,160,503


-


-

Amounts due to related parties-current

6,118,678


5,765,307


850,428

Deferred revenue from related parties

121,644,250


162,096,649


23,910,529

Deferred revenues

36,432,195


28,349,494


4,181,773

Other current liabilities

10,397,008


11,936,250


1,760,691

Total current liabilities

482,937,736


538,704,058


79,463,080

Deferred revenue — non-current from related parties

75,413,617


84,094,477


12,404,596

Deferred revenue — non-current

5,677,905


5,357,869


790,328

Non-current uncertain tax position liabilities

5,938,816


-


-

Deferred tax liabilities— non-current

9,815,595


7,238,047


1,067,669

Total Liabilities

579,783,669


635,394,451


93,725,673

Equity

1,548,270,750


1,658,335,678


244,617,538

Total Liabilities and Total Shareholders' Equity

2,128,054,419


2,293,730,129


338,343,211







[5] Jupai adopted ASU 2015-17 and therefore, deferred tax assets and liabilities are classified as non-current assets and liabilities starting 2017. Prior balances were not retrospectively adjusted.

 

 


Jupai Holdings Limited

Unaudited Condensed Consolidated Income Statements

(In RMB, except for ADS data and percentages)





Three months ended



June 30,


June 30,


June 30,


YoY


2016


2017


2017


Change %


RMB


RMB


USD



Revenues








Third party revenues

69,913,612


181,615,717


26,789,745


159.8%

Related party revenues

172,039,634


256,327,796


37,810,363


49.0%

Total revenues

241,953,246


437,943,513


64,600,108


81.0%

Business taxes and related surcharges

2,777,431


(1,323,349)


(195,204)


-147.6%

Net revenues

244,730,677


436,620,164


64,404,904


78.4%









Operating costs and expenses:








Cost of revenues

(99,371,220)


(161,980,682)


(23,893,423)


63.0%

Selling expenses

(51,917,514)


(65,363,762)


(9,641,668)


25.9%

General and administrative expenses

(39,243,812)


(45,122,521)


(6,655,926)


15.0%

Other operating income — government subsidies

106,027


1,932,631


285,078


1722.8%

Total operating cost and expenses

(190,426,519)


(270,534,334)


(39,905,939)


42.1%

Income from operations

54,304,158


166,085,830


24,498,965


205.8%









Interest income

2,062,097


1,005,019


148,248


-51.3%

Investment income

3,386,143


2,886,193


425,736


-14.8%

Net other loss

(98,076)


(1,761,304)


(259,806)


1695.9%

Total other income

5,350,164


2,129,908


314,178


-60.2%

Income before taxes and income from equity in affiliates

59,654,322


168,215,738


24,813,143


182.0%

Income tax expense

(15,479,756)


(44,703,075)


(6,594,055)


188.8%

Income from equity in affiliates

321,060


1,829,772


269,906


469.9%

Net income

44,495,626


125,342,435


18,488,994


181.7%

Less: Net income attributable to non-controlling interests

(4,526,215)


(12,880,046)


(1,899,908)


184.6%

Net income attributable to ordinary shareholders

39,969,411


112,462,389


16,589,086


181.4%









Net income per ADS:








Basic

1.25


3.47


0.51


177.6%

Diluted

1.19


3.33


0.49


179.8%

Weighted average number of ADSs used in computation:








Basic

32,055,180


32,366,756


32,366,756


1.0%

Diluted

33,480,400


33,754,351


33,754,351


0.8%

 

 


Jupai Holdings Limited

Unaudited Condensed Consolidated Income Statements

(In RMB, except for ADS data and percentages)





Six months ended



June 30,


June 30,


June 30,


YoY


2016


2017


2017


Change %


RMB


RMB


USD



Revenues








Third party revenues

155,831,925


283,489,110


41,816,870


81.9%

Related party revenues

312,759,083


525,169,327


77,466,601


67.9%

Total revenues

468,591,008


808,658,437


119,283,471


72.6%

Business taxes and related surcharges

149,174


(3,297,893)


(486,465)


-2310.8%

Net revenues

468,740,182


805,360,544


118,797,006


71.8%









Operating costs and expenses:








Cost of revenues

(210,864,251)


(296,733,214)


(43,770,480)


40.7%

Selling expenses

(104,332,330)


(124,882,852)


(18,421,201)


19.7%

General and administrative expenses

(71,127,291)


(97,744,401)


(14,418,067)


37.4%

Other operating income — government subsidies

3,257,489


5,340,843


787,816


64.0%

Total operating cost and expenses

(383,066,383)


(514,019,624)


(75,821,932)


34.2%

Income from operations

85,673,799


291,340,920


42,975,074


240.1%









Interest income

2,770,252


8,508,428


1,255,060


207.1%

Investment income

6,545,935


4,927,992


726,918


-24.7%

Net other income (loss)

200,377


(1,738,081)


(256,381)


-967.4%

Total other income

9,516,564


11,698,339


1,725,597


22.9%

Income before taxes and income from equity in affiliates

95,190,363


303,039,259


44,700,671


218.4%

Income tax expense

(24,262,042)


(74,338,103)


(10,965,454)


206.4%

Income (loss) from equity in affiliates

67,599


(3,887,071)


(573,374)


-5850.2%

Net income

70,995,920


224,814,085


33,161,843


216.7%

Less: Net income attributable to non-controlling interests

(4,533,625)


(21,658,803)


(3,194,843)


377.7%

Net income attributable to ordinary shareholders

66,462,295


203,155,282


29,967,000


205.7%









Net income per ADS:








Basic

2.08


6.28


0.93


201.9%

Diluted

1.99


6.02


0.89


202.5%

Weighted average number of ADSs used in computation:








Basic

31,998,559


32,335,540


32,335,540


1.1%

Diluted

33,422,940


33,746,769


33,746,769


1.0%

 

 

Jupai Holdings Limited

Unaudited Condensed Comprehensive Income Statements

(In RMB)





Three months ended



June 30,


June 30,


June 30,


Change


2016


2017


2017




RMB


RMB


USD



Net income

44,495,626


125,342,435


18,488,994


181.7%

Other comprehensive income, net of tax:








Change in cumulative foreign currency translation adjustment

15,960,956


(10,039,828)


(1,480,954)


-162.9%

Other comprehensive income

15,960,956


(10,039,828)


(1,480,954)


-162.9%

Comprehensive income

60,456,582


115,302,607


17,008,040


90.7%

Less: Comprehensive income attributable to non-controlling interests

4,526,215


12,880,046


1,899,908


184.6%

Comprehensive income attributable to ordinary shareholders

55,930,367


102,422,561


15,108,132


83.1%


 

 

Jupai Holdings Limited

Unaudited Condensed Comprehensive Income Statements

(In RMB)





Six months ended



June 30,


June 30,


June 30,


Change


2016


2017


2017




RMB


RMB


USD



Net income

70,995,920


224,814,085


33,161,843


216.7%

Other comprehensive income, net of tax:








Change in cumulative foreign currency translation adjustment

12,053,493


(16,226,292)


(2,393,506)


-234.6%

Other comprehensive income

12,053,493


(16,226,292)


(2,393,506)


-234.6%

Comprehensive income

83,049,413


208,587,793


30,768,337


151.2%

Less: Comprehensive income attributable to non-controlling interests

4,533,625


21,658,803


3,194,843


377.7%

Comprehensive income attributable to ordinary shareholders

78,515,788


186,928,990


27,573,494


138.1%


 

 

Jupai Holdings Limited

Reconciliation of GAAP to Non-GAAP Results

(In RMB, except for ADS data and percentages)





Three months ended



June 30,


June 30,


Change


2016


2017




RMB


RMB



Net margin attributable to ordinary shareholders

16.4%


25.8%



Adjusted net margin attributable to ordinary shareholders (non-GAAP)

19.9%


28.7%









Net income attributable to ordinary shareholders

39,969,411


112,462,389


181.4%

Adjustment for share-based compensation

5,133,761


9,500,023


85.0%

Adjustment for amortization of intangible assets related to acquisition

3,455,205


3,530,985


2.2%

Adjusted net income attributable to ordinary shares(non-GAAP)

48,558,377


125,493,397


158.4%







Net income attributable to ordinary shares per ADS, diluted

1.19


3.33


179.8%

Adjusted net income attributable to ordinary shares per ADS, diluted (non-GAAP)

1.45


3.72


156.6%







Weighted average number of ADSs used in computation:






Diluted

33,480,400


33,754,351


0.8%

 

 

Jupai Holdings Limited

Reconciliation of GAAP to Non-GAAP Results

(In RMB, except for ADS data and percentages)





Six months ended



June 30,


June 30,


Change


2016


2017




RMB


RMB



Net margin attributable to ordinary shareholders

14.2%


25.2%



Adjusted net margin attributable to ordinary shareholders (non-GAAP)

17.8%


28.1%









Net income attributable to ordinary shareholders

66,462,295


203,155,282


205.7%

Adjustment for share-based compensation

10,136,257


16,386,904


61.7%

Adjustment for amortization of intangible assets related to acquisition

6,822,041


7,126,943


4.5%

Adjusted net income attributable to ordinary shares(non-GAAP)

83,420,593


226,669,129


171.7%







Net income attributable to ordinary shares per ADS, diluted

1.99


6.02


202.5%

Adjusted net income attributable to ordinary shares per ADS, diluted (non-GAAP)

2.50


6.72


168.8%







Weighted average number of ADSs used in computation:






Diluted

33,422,940


33,746,769


1.0%

 

SOURCE Jupai Holdings Limited


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