NOAH HOLDINGS LIMITED ANNOUNCES UNAUDITED FINANCIAL RESULTS FOR THE THIRD QUARTER OF 2023

Rhea-AI Summary

Noah Holdings Limited (NYSE: NOAH and HKEX: 6686) reported a 9.6% increase in net revenues for the third quarter of 2023, totaling RMB750.0 million (US$102.8 million). The company's net income attributable to Noah shareholders for the quarter was RMB233.3 million (US$32.0 million), a 27.9% increase from the corresponding period in 2022. The total number of registered clients as of September 30, 2023, increased by 4.4% from the previous year, reaching 452,222.

Positive

• 9.6% increase in net revenues for Q3 2023
• 27.9% increase in net income attributable to Noah shareholders
• 4.4% increase in the total number of registered clients

Negative

• 20.4% decrease in net revenues compared with the second quarter of 2023
• 28.8% decrease in income from operations compared with the second quarter of 2023
• 58.1% decrease in the total number of active clients who transacted with the company during the third quarter of 2023

SHANGHAI, Nov. 29, 2023 /PRNewswire/ -- Noah Holdings Limited ("Noah" or the "Company") (NYSE: NOAH and HKEX: 6686), a leading wealth management service provider in China offering comprehensive global investment and asset allocation advisory services primarily for high net worth investors, today announced its unaudited financial results for the third quarter of 2023.

THIRD QUARTER 2023 FINANCIAL HIGHLIGHTS

• Net revenues for the third quarter of 2023 were RMB750.0 million (US$102.8 million), a 9.6% increase from the corresponding period in 2022, mainly due to increases in one-time commissions. Net revenues decreased by 20.4% compared with the second quarter of 2023, mainly due to a decrease in distribution of insurance products.

(RMB millions, except percentages)	Q3 2022			Q3 2023			YoY Change
Wealth management	466.0			548.8			17.8 %
Asset management	200.3			191.4			(4.4 %)
Other businesses	18.2			9.8			(46.2 %)
Total net revenues	684.5			750.0			9.6 %

• Income from operations for the third quarter of 2023 was RMB248.9 million (US$34.1 million), a 7.4% increase from the corresponding period in 2022, due to a 9.6% increase in net revenues; income from operations decreased by 28.8% compared with the second quarter of 2023, due to a 50.8% decrease in one-time commissions.

(RMB millions, except percentages)		Q3 2022			Q3 2023			YoY Change
Wealth management		133.2			154.5			16.0 %
Asset management		117.7			106.5			(9.6 %)
Other businesses		(19.1)			(12.1)			(36.6 %)
Total income from operations		231.8			248.9			7.4 %

• Net income attributable to Noah shareholders for the third quarter of 2023 was RMB233.3 million (US$32.0 million), a 27.9% increase from the corresponding period in 2022, mainly due to a 158.0% increase in interest income as a result of higher interest rate for our US dollar cash deposits. Net income attributable to Noah shareholders decreased by 26.0% compared with the second quarter of 2023, mainly due to a 20.4% decrease in net revenues.
• Non-GAAP^[1] net income attributable to Noah shareholders for the third quarter of 2023 was RMB232.4 million (US$31.9 million), a 21.8% increase from the corresponding period in 2022, and a 25.8% decrease from the second quarter of 2023.

THIRD QUARTER 2023 OPERATIONAL UPDATES

Wealth Management Business

We offer investment products and provide value-added services to high net worth investors in China and overseas for our wealth management business. Noah primarily distributes private equity, private secondary, mutual funds and other products denominated in RMB and other currencies.

• Total number of registered clients as of September 30, 2023 was 452,222, a 4.4% increase from September 30, 2022, and a 1.3% increase from June 30, 2023.
• Total number of active clients^[2] who transacted with us during the third quarter of 2023 was 9,489, a 58.1% decrease from the third quarter of 2022, and a 17.8% decrease from the second quarter of 2023.
• Aggregate value of investment products distributed during the third quarter of 2023 was RMB22.3 billion (US$3.1 billion), a 24.2% increase from the third quarter of 2022, and a 21.2% increase from the second quarter of 2023, mainly due to an increase in the distribution of mutual fund products.

	Three months ended September 30,
	2022				2023
Product type	(RMB in billions, except percentages)
Mutual fund products	11.7		64.8 %		14.9		66.9 %
Private secondary products	3.3		18.5 %		5.7		25.4 %
Private equity products	2.5		13.9 %		0.7		3.1 %
Other products[3]	0.5		2.8 %		1.0		4.6 %
All products	18.0		100.0 %		22.3		100.0 %

• Coverage network in mainland China covered 59 cities as of September 30, 2023, compared with 76 cities as of September 30, 2022 and 63 cities as of June 30, 2023, as we continue to streamline our domestic coverages and focus on strengthening our operations in central hub cities.
• Number of relationship managers was 1,408 as of September 30, 2023, a 12.0% increase from September 30, 2022, and a 2.4% increase from June 30, 2023. Among which, we had 77 overseas relationship managers as of September 30, 2023, a 37.5% increase from June 30, 2023.

Asset Management Business

Our asset management business is conducted through Gopher Asset Management Co., Ltd. ("Gopher Asset Management"), a leading multi-asset manager in China with overseas offices in Hong Kong and the United States. Gopher Asset Management develops and manages assets ranging from private equity, real estate, public securities to multi-strategies investments denominated in RMB and other currencies.

• Total assets under management as of September 30, 2023 were RMB154.9 billion (US$21.2 billion), a 1.3% decrease from June 30, 2023 and a 0.9% decrease from September 30, 2022, mainly due to exits in private equity investment products.

Investment type	As of  June 30,  2023				Growth		Distribution/  Redemption		As of September 30,  2023
	(RMB billions, except percentages)
Private equity	132.9		84.7 %		0.2		1.4		131.7		85.0 %
Public securities[4]	11.6		7.4 %		4.2		3.6		12.2		7.9 %
Real estate	6.6		4.2 %		0.3		0.6		6.3		4.0 %
Multi-strategies	4.4		2.8 %		-		0.2		4.2		2.8 %
Others	1.4		0.9 %		-		0.9		0.5		0.3 %
All Investments	156.9		100.0 %		4.7		6.7		154.9		100.0 %

 

[1] Noah's Non-GAAP financial measures are its corresponding GAAP financial measures excluding the effects of all forms of share-based compensation and net of relevant tax impact, if any. See "Reconciliation of GAAP to Non-GAAP Results" at the end of this press release.

[2]  "Active clients" for a given period refers to registered high net worth investors who purchase investment products distributed or receive services provided by us during that given period.

[3]  "Other products" refers to other investment products, which includes insurance products, multi-strategies products and others.

[4]  The asset distribution/redemption of public securities also includes market appreciation or depreciation.

 

Other Businesses

Our other businesses segment mainly provides more comprehensive services and investment products to our clients. 

Ms. Jingbo Wang, co-founder, Chairwoman and CEO of Noah, said, "I'm pleased to report a strong quarter with net revenues increasing 9.6% year-over-year to RMB750.0 million, primarily driven by one-time commissions from the distribution of insurance products. With a robust balance sheet and nearly RMB5 billion in cash and cash equivalents, ample liquidity, and a standardized product offering, we are well-positioned to fuel future growth and execute on our strategic plans. Our clean Assets Under Advisory (AUA) with no legacy private credit or residential real estate exposure has built us a solid reputation as a trusted advisor to mandarin-speaking HNW clients, which we are leveraging to drive our global expansion, as demand for global asset allocation grows. We continue to recruit Relationship Managers in Hong Kong and Singapore; meanwhile, our client service centre in Los Angeles is up and running, and we are preparing to commence operations in Dubai. We are also offering clients sophisticated market intelligence and asset allocation strategies through our innovative 'CCI' model (composed of the Chief Investment Office, Client Strategy Office, and Investment Product & Solution department) and its solutions-driven wealth management approach. As we rapidly approach the end of the year, we are increasingly confident in our abilities to carefully navigate an increasingly complex macroeconomic environment and create value for our shareholders."

THIRD QUARTER 2023 FINANCIAL RESULTS

Net Revenues

Net revenues for the third quarter of 2023 were RMB750.0 million (US$102.8 million), a 9.6% increase from the corresponding period in 2022, mainly due to increases in one-time commissions.

• Wealth Management Business
  • Net revenues from one-time commissions for the third quarter of 2023 were RMB198.5 million (US$27.2 million), a 115.5% increase from the corresponding period in 2022, primarily due to an increase in distribution of insurance products.
  • Net revenues from recurring service fees for the third quarter of 2023 were RMB279.7 million (US$38.3 million), an 8.8% decrease from the corresponding period in 2022, due to a shift in product mix and clients' investment preferences, as well as less recurring service fees generated from private secondary and private equity products.
  • Net revenues from performance-based income for the third quarter of 2023 were RMB8.8 million (US$1.2 million), a 51.3% decrease from the corresponding period of 2022, primarily due to less performance-based income from private secondary products.
  • Net revenues from other service fees for the third quarter of 2023 were RMB61.7 million (US$8.5 million), a 25.5% increase from the corresponding period in 2022, primarily due to more value-added services Noah offered to its high net worth clients.
• Asset Management Business
  • Net revenues from recurring service fees for the third quarter of 2023 were RMB186.3 million (US$25.5million), a 1.8% increase from the corresponding period in 2022, due to an increase in the amount of real estate investments managed by our Gopher New York team. 
  • Net revenues from performance-based income for the third quarter of 2023 were RMB5.1 million (US$0.7 million), a 46.3% decrease from the corresponding period in 2022, primarily due to a decrease in performance-based income from private equity investments managed by Gopher compared with the third quarter of 2022.
• Other Businesses
  • Net revenues for the third quarter of 2023 were RMB9.8 million (US$1.3 million), compared with RMB18.2 million for the corresponding period in 2022, as we continued to wind down our loan portfolio.

Operating Costs and Expenses

Operating costs and expenses for the third quarter of 2023 were RMB501.1 million (US$68.7 million), a 10.7% increase from the corresponding period in 2022. Operating costs and expenses primarily consisted of compensation and benefits of RMB400.8 million (US$54.9 million), selling expenses of RMB119.7 million (US$16.4 million), general and administrative expenses of RMB67.4 million (US$9.2 million), provision for credit losses of RMB0.5 million (US$0.1 million) and other operating expenses of RMB19.0 million (US$2.6 million).

• Operating costs and expenses for the wealth management business for the third quarter of 2023 were RMB394.2 million (US$54.0 million), a 18.5% increase from the corresponding period in 2022, primarily due to an increase in compensation and benefits, selling expenses and general and administrative expenses, as less expenses incurred during the corresponding quarter of the preceding year due to various pandemic restrictions.
• Operating costs and expenses for the asset management business for the third quarter of 2023 were RMB84.9 million (US$11.6 million), a 2.9% increase from the corresponding period in 2022, primarily due to increased selling expenses.
• Operating costs and expenses for other businesses for the third quarter of 2023 were RMB21.9 million (US$3.0 million), compared with RMB37.4 million from the corresponding period in 2022, due to decreased other operating expenses.

Operating Margin

Operating margin for the third quarter of 2023 was 33.2%, compared with 33.9% for the corresponding period in 2022.

• Operating margin for the wealth management business for the third quarter of 2023 was 28.2%, compared with 28.6% for the corresponding period in 2022.
• Operating margin for the asset management business for the third quarter of 2023 was 55.6%, compared with 58.8% for the corresponding period in 2022.
• Loss from operation for other businesses for the third quarter of 2023 was RMB12.1 million (US$1.7 million), compared with an operating loss of RMB19.1 million for the corresponding period in 2022.

Investment Income/loss

Investment income for the third quarter of 2023 was RMB9.6 million (US$1.3 million), compared with investment loss of RMB7.2 million for the corresponding period in 2022.

Income Tax Expenses

Income tax expenses for the third quarter of 2023 were RMB68.5 million (US$9.4 million), a 34.1% increase from the corresponding period in 2022, primarily due to more taxable income compared with the third quarter of 2022. 

Loss from Equity in Affiliates

Loss from equity in affiliates for the third quarter of 2023 was RMB3.9 million (US$0.5 million), compared with loss from equity in affiliates of RMB22.4 million for the corresponding period in 2022, as we recorded such loss from decrease in net income of the funds of funds that we manage and invest in as the general partner or fund manager in 2022.

Net Income

• Net Income
  • Net income for the third quarter of 2023 was RMB232.0 million (US$31.8 million), a 30.4% increase from the corresponding period in 2022.
  • Net margin for the third quarter of 2023 was 30.9%, up from 26.0% for the corresponding period in 2022.
  • Net income attributable to Noah shareholders for the third quarter of 2023 was RMB233.3 million (US$32.0 million), a 27.9% increase from the corresponding period in 2022.
  • Net margin attributable to Noah shareholders for the third quarter of 2023 was 31.1%, up from 26.7% for the corresponding period in 2022.
  • Net income attributable to Noah shareholders per basic and diluted ADS for the third quarter of 2023 was RMB3.36 (US$0.46) and RMB3.36 (US$0.46), respectively, up from RMB2.64 and RMB2.63 respectively, for the corresponding period in 2022.
• Non-GAAP Net Income Attributable to Noah Shareholders
  • Non-GAAP net income attributable to Noah shareholders for the third quarter of 2023 was RMB232.4 million (US$31.9 million), a 21.8% increase from the corresponding period in 2022.
  • Non-GAAP net margin attributable to Noah shareholders for the third quarter of 2023 was 31.0%, compared with 27.9% for the corresponding period in 2022.
  • Non-GAAP net income attributable to Noah shareholders per diluted ADS for the third quarter of 2023 was RMB3.35 (US$0.46), up from RMB2.76 for the corresponding period in 2022.

Balance Sheet and Cash Flow

As of September 30, 2023, the Company had RMB4,959.6 million (US$679.8 million) in cash and cash equivalents, compared with RMB4,740.4 million as of June 30, 2023 and RMB4,312.8 million as of September 30, 2022.

Net cash inflow from the Company's operating activities during the third quarter of 2023 was RMB404.4 million (US$55.4 million), primarily due to operating cash inflow generated by net income and collection of accounts receivables.

Net cash inflow from the Company's investing activities during the third quarter of 2023 was RMB4.0 million (US$0.5 million), primarily due to collection of loan receivables.

Net cash outflow from the Company's financing activities was RMB196.3 million (US$26.9 million) in the third quarter of 2023, primarily due to payment of the final dividend.

CONFERENCE CALL 

The Company's senior management will host an earnings conference call to discuss its Q3 Results and recent business activities. Details of the conference call are as follows:

Conference title:	Noah Holdings 3Q23 Earnings Conference Call
Date/Time:	Wednesday, November 29, 2023 at 8:00 p.m., U.S. Eastern Time Thursday, November 30, 2023 at 9:00 a.m., Hong Kong Time
Dial in:
– Hong Kong Toll Free:	800-963976
– United States Toll Free:	1-888-317-6003
– Mainland China Toll Free:	4001-206115
– International Toll:	1-412-317-6061
Participant Password:	7559504

A telephone replay will be available starting approximately one hour after the end of the conference until December 6, 2023 at 1-877-344-7529 (US Toll Free) and 1-412-317-0088 (International Toll) with the access code 1973272.

A live and archived webcast of the conference call will be available at the Company's investor relations website under the "Financial Reports" section at http://ir.noahgroup.com.

DISCUSSION OF NON-GAAP MEASURES

In addition to disclosing financial results prepared in accordance with U.S. GAAP, the Company's earnings release contains non-GAAP financial measures excluding the effects of all forms of share-based compensation and net of tax impact, if any. See "Reconciliation of GAAP to Non-GAAP Results" at the end of this press release.

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 measures 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 the foregoing non-GAAP net income attributable to Noah shareholders and per diluted ADS and non-GAAP net margin attributable to Noah shareholders to supplement U.S. GAAP financial data. As such, the Company's management believes that the presentation of the non-GAAP financial measures provides important supplemental information to investors regarding financial and business trends relating to its results of operations in a manner consistent with that used by management. 

ABOUT NOAH HOLDINGS LIMITED

Noah Holdings Limited (NYSE: NOAH and HKEX:6686) is a leading and pioneer wealth management service provider in China offering comprehensive one-stop advisory services on global investment and asset allocation primarily for high net worth investors. Noah is a Cayman Islands holding company and carries on business in Hong Kong as Noah Holdings Private Wealth and Asset Management Limited. In the first nine months of 2023, Noah distributed RMB57.5 billion (US$7.9 billion) of investment products. Through Gopher Asset Management, Noah had assets under management of RMB154.9 billion (US$21.2 billion) as of September 30, 2023.

Noah's wealth management business primarily distributes private equity, private secondary, mutual fund and other products denominated in RMB and other currencies. Noah's network covers major cities in mainland China, as well as offices in Hong Kong (China), Taiwan (China), New York, Silicon Valley and Singapore. A total of 1,408 relationship managers across 59 cities provide customized financial solutions for clients through this network, and meet their international investment needs. The Company's wealth management business had 452,222 registered clients as of September 30, 2023. Through Gopher Asset Management, Noah manages private equity, public securities, real estate, multi-strategy and other investments denominated in RMB and other currencies. The Company also provides other services.

For more information, please visit Noah at ir.noahgroup.com.

FOREIGN CURRENCY TRANSLATION

In this announcement, the unaudited financial results for the third quarter of 2023 ended September 29, 2023 are stated in RMB. This announcement contains currency conversions of certain RMB amounts into US$ at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to US$ are made at a rate of RMB7.296 to US$1.00, the effective noon buying rate for September 29, 2023 as set forth in the H.10 statistical release of the Federal Reserve Board.

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. 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 announcements, circulars or other publications made on the website of The Stock Exchange of Hong Kong Limited (the "Hong Kong Stock Exchange"), 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. These statements include, but are not limited to, estimates regarding the sufficiency of Noah's cash and cash equivalents and liquidity risk. A number of factors could cause Noah's actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: its goals and strategies; its future business development, financial condition and results of operations; the expected growth of the wealth management and asset management market in China and internationally; its expectations regarding demand for and market acceptance of the products it distributes; investment risks associated with investment products distributed to Noah's investors, including the risk of default by counterparties or loss of value due to market or business conditions or misconduct by counterparties; its expectations regarding keeping and strengthening its relationships with key clients; relevant government policies and regulations relating to its industries; its ability to attract and retain qualified employees; its ability to stay abreast of market trends and technological advances; its plans to invest in research and development to enhance its product choices and service offerings; competition in its industries in China and internationally; general economic and business conditions in China; and its ability to effectively protect its intellectual property rights and not to infringe on the intellectual property rights of others. Further information regarding these and other risks is included in Noah's filings with the U.S. Securities and Exchange Commission and the Hong Kong Stock Exchange. All information provided in this press release and in the attachments is as of the date of this press release, and Noah 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 the applicable law.

Contacts: 

Noah Holdings Limited
Melo Xi
Tel: +86-21-8035-8292
ir@noahgroup.com 

-- FINANCIAL AND OPERATIONAL TABLES FOLLOW --

Noah Holdings Limited
Condensed Consolidated Balance Sheets
(unaudited)
			As of
			June 30,		September 30,		September 30,
			2023		2023		2023
			RMB'000		RMB'000		USD'000
Assets
	Current assets:
		Cash and cash equivalents	4,740,434		4,959,550		679,763
		Restricted cash	143,255		153,908		21,095
		Short-term investments	445,485		407,872		55,904
		Accounts receivable, net	534,885		445,386		61,045
		Loans receivable, net	341,083		315,785		43,282
		Amounts due from related parties	429,202		406,764		55,752
		Other current assets	200,588		189,473		25,969
		Total current assets	6,834,932		6,878,738		942,810
	Long-term investments, net		980,257		995,746		136,478
	Investment in affiliates		1,464,702		1,491,173		204,382
	Property and equipment, net		2,525,732		2,510,839		344,139
	Operating lease right-of-use assets, net		152,040		145,410		19,930
	Deferred tax assets		436,240		435,632		59,708
	Other non-current assets		169,454		171,083		23,449
Total Assets			12,563,357		12,628,621		1,730,896
Liabilities and Equity
	Current liabilities:
		Accrued payroll and welfare expenses	562,029		545,240		74,731
		Income tax payable	141,693		166,959		22,884
		Deferred revenues	71,440		88,377		12,113
		Dividend payable	177,502		49		7
		Other current liabilities	584,384		578,296		79,262
		Contingent liabilities	592,097		595,137		81,570
	Total current liabilities		2,129,145		1,974,058		270,567
	Operating lease liabilities, non-current		79,267		77,418		10,611
	Deferred tax liabilities		230,797		229,003		31,387
	Other non-current liabilities		54,495		45,058		6,176
	Total Liabilities		2,493,704		2,325,537		318,741
	Equity		10,069,653		10,303,084		1,412,155
Total Liabilities and Equity			12,563,357		12,628,621		1,730,896

 

Noah Holdings Limited
Condensed Consolidated Income Statements
(In RMB'000, except for ADS data, per ADS data and percentages)
(unaudited)
		Three months ended
		September 30,			September 30,					September 30,				Change
		2022			2023					2023
Revenues:		RMB'000			RMB'000					USD'000
Revenues from others:
One-time commissions		92,551			199,286					27,314				115.3 %
Recurring service fees		195,429			171,408					23,493				(12.3 %)
Performance-based income		17,658			8,440					1,157				(52.2 %)
Other service fees		71,290			74,355					10,191				4.3 %
Total revenues from others		376,928			453,489					62,155				20.3 %
Revenues from funds Gopher      manages:
One-time commissions		7,846			32					4				(99.6 %)
Recurring service fees		296,648			295,982					40,568				(0.2 %)
Performance-based income		10,109			5,543					760				(45.2 %)
Total revenues from funds      Gopher manages		314,603			301,557					41,332				(4.1 %)
Total revenues		691,531			755,046					103,487				9.2 %
Less: VAT related surcharges		(7,063)			(5,088)					(697)				(28.0 %)
Net revenues		684,468			749,958					102,790				9.6 %
Operating costs and expenses:
Compensation and benefits
Relationship managers		(108,971)			(185,748)					(25,459)				70.5 %
Others		(234,055)			(215,047)					(29,475)				(8.1 %)
Total compensation and       benefits		(343,026)			(400,795)					(54,934)				16.8 %
Selling expenses		(75,995)			(119,707)					(16,407)				57.5 %
General and administrative       expenses		(57,511)			(67,407)					(9,239)				17.2 %
Reversal of credit losses		5,274			525					72				(90.0 %)
Other operating expenses		(25,084)			(18,982)					(2,602)				(24.3 %)
Government subsidies		43,645			105,297					14,432				141.3 %
Total operating costs and    expenses		(452,697)			(501,069)					(68,678)				10.7 %
Income from operations		231,771			248,889					34,112				7.4 %
Other income:
Interest income		16,847			43,465					5,957				158.0 %
Investment (loss) income		(7,233)			9,640					1,321				N.A.
Other income		10,066			2,446					335				(75.7 %)
Total other income		19,680			55,551					7,613				182.3 %
Income before taxes and   income from equity in affiliates		251,451			304,440					41,725				21.1 %
Income tax expense		(51,078)			(68,499)					(9,389)				34.1 %
Loss from equity in affiliates		(22,406)			(3,897)					(534)				(82.6 %)
Net income		177,967			232,044					31,802				30.4 %
Less: net loss attributable to    non-controlling interests		(4,448)			(1,282)					(176)				(71.2 %)
Net income attributable to    Noah shareholders		182,415			233,326					31,978				27.9 %
Income per ADS, basic		2.64			3.36					0.46				27.3 %
Income per ADS, diluted		2.63			3.36					0.46				27.8 %
Margin analysis:
Operating margin		33.9 %			33.2 %					33.2 %
Net margin		26.0 %			30.9 %					30.9 %
Weighted average ADS equivalent[1]:
Basic		69,212,818			69,472,282					69,472,282
Diluted		69,255,667			69,485,287					69,485,287
ADS equivalent outstanding at end of period		62,558,122			63,154,215					63,154,215
[1] Assumes all outstanding ordinary shares are represented by ADSs. Each ordinary share represents two ADSs.

 

Noah Holdings Limited
Condensed Comprehensive Income Statements
(unaudited)
	Three months ended
	September 30,		September 30,		September 30,				Change
	2022		2023		2023
	RMB'000		RMB'000		USD'000
Net income	177,967		232,044		31,802				30.4 %
Other comprehensive income, net of tax:
Foreign currency translation     adjustments	107,640		21,405		2,934				(80.1 %)
Comprehensive income	285,607		253,449		34,736				(11.3 %)
Less: Comprehensive loss attributable to non-controlling interests	(4,428)		(1,169)		(160)				73.6 %
Comprehensive income attributable to     Noah shareholders	290,035		254,618		34,896				(12.2 %)

 

Noah Holdings Limited
Supplemental Information
(unaudited)
	As of
	September 30,  2022		September 30,  2023		Change
Number of registered clients	433,250		452,222		4.4 %
Number of relationship managers	1,257		1,408		12.0 %
Number of cities in mainland China under coverage	76		59		(22.4 %)
	Three months ended
	September 30, 2022		September 30,  2023		Change
	(in millions of RMB, except number of active clients and percentages)
Number of active clients	22,641		9,489		(58.1 %)
Transaction value:
Private equity products	2,487		693		(72.1 %)
Private secondary products	3,326		5,670		70.5 %
Mutual fund products	11,650		14,929		28.1 %
Other products	507		1,024		102.1 %
Total transaction value	17,970		22,316		24.2 %

   

Noah Holdings Limited
Segment Condensed Income Statements
(unaudited)
	Three months ended September 30, 2023
	Wealth  Management Business		Asset  Management Business		Other  Businesses		Total
	RMB'000		RMB'000		RMB'000		RMB'000
Revenues:
Revenues from others
One-time commissions	199,286		-		-		199,286
Recurring service fees	171,408		-		-		171,408
Performance-based income	8,440		-		-		8,440
Other service fees	61,915		-		12,440		74,355
Total revenues from others	441,049		-		12,440		453,489
Revenues from funds Gopher      manages
One-time commissions	-		32		-		32
Recurring service fees	109,368		186,614		-		295,982
Performance-based income	405		5,138		-		5,543
Total revenues from funds Gopher      manages	109,773		191,784		-		301,557
Total revenues	550,822		191,784		12,440		755,046
Less: VAT related surcharges	(2,074)		(389)		(2,625)		(5,088)
Net revenues	548,748		191,395		9,815		749,958
Operating costs and expenses:
Compensation and benefits
Relationship managers	(179,854)		(5,894)		-		(185,748)
Others	(144,256)		(64,041)		(6,750)		(215,047)
Total compensation and benefits	(324,110)		(69,935)		(6,750)		(400,795)
Selling expenses	(94,088)		(18,723)		(6,896)		(119,707)
General and administrative      expenses	(53,401)		(9,217)		(4,789)		(67,407)
(Provision for) reversal of credit      losses	(894)		(400)		1,819		525
Other operating expenses	(11,677)		(298)		(7,007)		(18,982)
Government subsidies	89,925		13,656		1,716		105,297
Total operating costs and expenses	(394,245)		(84,917)		(21,907)		(501,069)
Income (loss) from operations	154,503		106,478		(12,092)		248,889

 

Noah Holdings Limited
Segment Condensed Income Statements
(unaudited)
	Three months ended September 30, 2022
	Wealth  Management Business		Asset  Management Business		Other  Businesses		Total
	RMB'000		RMB'000		RMB'000		RMB'000
Revenues:
Revenues from others
One-time commissions	92,551		-		-		92,551
Recurring service fees	195,429		-		-		195,429
Performance-based income	17,658		-		-		17,658
Other service fees	49,368		-		21,922		71,290
Total revenues from others	355,006		-		21,922		376,928
Revenues from funds Gopher      manages
One-time commissions	-		7,846		-		7,846
Recurring service fees	112,636		184,012		-		296,648
Performance-based income	515		9,594		-		10,109
Total revenues from funds Gopher       manages	113,151		201,452		-		314,603
Total revenues	468,157		201,452		21,922		691,531
Less: VAT related surcharges	(2,212)		(1,139)		(3,712)		(7,063)
Net revenues	465,945		200,313		18,210		684,468
Operating costs and expenses:
Compensation and benefits
Relationship managers	(103,275)		(5,696)		-		(108,971)
Others	(165,245)		(58,758)		(10,052)		(234,055)
Total compensation and benefits	(268,520)		(64,454)		(10,052)		(343,026)
Selling expenses	(65,988)		(8,796)		(1,211)		(75,995)
General and administrative      expenses	(39,345)		(10,947)		(7,219)		(57,511)
Reversal of (provision for) credit      losses	931		(14)		4,357		5,274
Other operating expenses	(1467)		(357)		(23,260)		(25,084)
Government subsidies	41,610		2,005		30		43,645
Total operating costs and expenses	(332,779)		(82,563)		(37,355)		(452,697)
Income (loss) from operations	133,166		117,750		(19,145)		231,771

 

Noah Holdings Limited
Supplement Revenue Information by Geography
(unaudited)
	Three months ended September 30, 2023
	Wealth  Management Business		Asset  Management Business		Other Businesses		Total
	RMB'000		RMB'000		RMB'000		RMB'000
Revenues:
Mainland China	333,911		116,355		12,440		462,706
Hong Kong	165,361		42,668		-		208,029
Others	51,550		32,761		-		84,311
Total revenues	550,822		191,784		12,440		755,046

 

	Three months ended September 30, 2022
	Wealth  Management Business		Asset  Management Business		Other Businesses		Total
	RMB'000		RMB'000		RMB'000		RMB'000
Revenues:
Mainland China	302,088		173,771		21,922		497,781
Hong Kong	125,240		6,945		-		132,185
Others	40,829		20,736		-		61,565
Total revenues	468,157		201,452		21,922		691,531

 

Noah Holdings Limited
Reconciliation of GAAP to Non-GAAP Results
(In RMB, except for per ADS data and percentages)
(unaudited)
	Three months ended
	September 30,		September  30,		Change
	2022		2023
	RMB'000		RMB'000
Net income attributable to Noah shareholders	182,415		233,326		27.9 %
Adjustment for share-based compensation	11,148		(1,161)			N.A.
Less: tax effect of adjustments	2,684		(281)			N.A.
Adjusted net income attributable to Noah shareholders         (non-GAAP)	190,879		232,446			21.8 %
Net margin attributable to Noah shareholders	26.7 %		31.1 %
Non-GAAP net margin attributable to Noah shareholders	27.9 %		31.0 %
Net income attributable to Noah shareholders per ADS,          diluted	2.63		3.36			27.8 %
Non-GAAP net income attributable to Noah shareholders          per ADS, diluted	2.76		3.35			21.4 %

 

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SOURCE Noah Holdings Limited