UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 

 

FORM 6-K

 

 

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of May 2020

 

Commission File Number: 001-33768

 

 

FANHUA INC.

 

 

27/F, Pearl River Tower
No.15 West Zhujiang Road
Tianhe District, Guangzhou 510623
People’s Republic of China
(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F ☒     Form 40-F ☐

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

  

 

  

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	Fanhua Inc.
	By:	/s/ Chunlin Wang
	Name:	Chunlin Wang
	Title:	Chief Executive Officer

 

Date: May 27, 2020

 

  

Exhibit Index

 

Exhibit No.		Description.
Exhibit 99.1		Press Release
Exhibit 99.2		Press Release

 

 

2

Exhibit 99.1

 

 

Fanhua Reports First Quarter 2020 Unaudited Financial Results

 

GUANGZHOU, China, May 26, 2020, Eastern Daylight Time, (GLOBE NEWSWIRE) -- Fanhua Inc., (Nasdaq: FANH), (the “Company” or “Fanhua”), a leading independent financial services provider in China, today announced its unaudited financial results for the first quarter ended March 31, 2020¹.

 

Financial Highlights for the First Quarter of 2020:

 

(In thousands, except per ADS)		2019Q1 (RMB)				2020Q1 (RMB)				2020Q1 (US$)				Change %
Total net revenues			971,654				722,623				102,054				(25.6	)
Operating income			126,423				60,044				8,480				(52.5	)
Share of income (loss) of affiliates			25,413				(12,339	)			(1,743	)			-
Net income attributable to the Company’s shareholders			147,268				45,793				6,467				(68.9	)
Diluted net income per ADS			2.62				0.85				0.12				(67.6	)
Cash, cash equivalents and short- term investments (As of March, 31, 2019 and 2020)			2,394,009				1,843,238				260,315				(23.0	)

 

Commenting on the financial results of first quarter of 2020, Mr. Chunlin Wang, chairman and chief executive officer of Fanhua, stated, “As the global economy was hit hard by the COVID-19 outbreak, the life insurance sector in China has also been severely affected, with a low single digit growth of 2.7% year-over-year in life insurance gross written premiums (“GWP”). Despite this challenging environment, Fanhua still managed to generate RMB2.4 billion GWP in our life insurance business segment, representing a growth of 9.3% year-over-year, outpacing industry growth. Of the RMB2.4 billion, first year premiums (“FYP”) achieved RMB499.3 million and renewal premiums were RMB1.9 billion while annualized premiums equivalent (“APE”) were RMB307.7 million.

 

“Affected by the pandemic, a large number of enterprises at home and abroad have suffered serious losses, with many struggling to survive. Against this market backdrop, we beat expectation with operating income of RMB60.0 million and recorded net operating cash flow of RMB134.6 million during the quarter. The results vindicated the snowballing effect of our profit model, and reflected the strength and resilience of our business model.

 

“We previously expected the Covid-19 outbreak would be nearly over in China by the end of March and that our business could start to recover rapidly in the second quarter of 2020. However, as the pandemic spread rampantly around the world, a full resumption of work and production in China has also been delayed. Business activities originally planned for April such as agent recruitment, trainings and product seminars could not be carried out offline as usual, which significantly impacted our results for the second quarter of 2020, especially for the sales of higher ticket savings-typed products as face-to-face meetings are important in customers’ decision-making process.

 

1

This announcement contains currency conversions of certain Renminbi (RMB) amounts into U.S. dollars (US$) at specified rates solely for the convenience of the reader. Unless otherwise noted, all translations from RMB to U.S. dollars are made at a rate of RMB7.0808 to US$1.00, the effective noon buying rate as of March 31, 2020 in The City of New York for cable transfers of RMB as set forth in the H.10 weekly statistical release of the Federal Reserve Board.

 

 

 

 

“Since the outbreak, Fanhua has responded with effective and vigorous countermeasures, including conducting our operational activities digitally by leveraging our strength in digital technologies and introducing several supportive policies for our employees and agents. We are pleased that these measures and policies have helped keep our employees and agents united and motivated. Since the beginning of May, our agents across China have gradually resumed all kinds of offline trainings, agent recruitment and sales activities.

 

“Based on our preliminary assessment, we remain optimistic that we will be able to outpace industry growth and achieve positive quarter-over-quarter growth in the second quarter of 2020, with APE to be no less than RMB350 million and operating income no less than RMB70 million.

 

“As the insurance market is a crucial part for China’s plans to become a financial powerhouse, we believe that the underlying growth trend of the Chinese insurance market remains unchanged in the long run. In addition, risk awareness has been significantly enhanced among Chinese consumers during this unprecedented health crisis, which is expected to significantly drive the demand for insurance products. We believe we are well-positioned to benefit from such growth opportunities.

 

“Despite the uncertainties caused by the pandemic, we are confident that we will be able to remain profitable with stable operating cash flow. As such, management reiterates that we will maintain our regular dividend policy of $0.25 per ADS for the remainder of the year.”

 

Financial Results for the First quarter of 2020

 

Total net revenues were RMB722.6 million (US$102.1 million) for the first quarter of 2020, representing a decrease of 25.6% from RMB971.7 million for the corresponding period in 2019.

 

●

Net revenues for the life insurance business were RMB625.2 million (US$88.3 million) for the first quarter of 2020, representing a decrease of 27.2% from RMB859.2 million for the corresponding period in 2019. The decrease was mainly due to the decline of 42.5% in first year commission from RMB670.2 million to RMB385.2 million, offset by the growth of 27.0% in renewal commissions from RMB189.0 million to RMB240.0 million as a result of the accumulation of renewal business and high persistency ratio. Revenues generated from our life insurance business accounted for 86.5% of our total net revenues in the first quarter of 2020.

 

 

 

 

●

Net revenues for the P&C insurance business were RMB25.0 million (US$3.5 million) for the first quarter of 2020, representing a decrease of 34.4% from RMB38.1 million for the corresponding period in 2019. Revenues for the P&C insurance business are mainly derived from commissions generated from Baowang (www.baoxian.com). The decrease was primarily due to the cessation by certain insurance companies in underwriting several popular accident insurance products distributed through Baowang (www.baoxian.com). Revenues generated from the P&C insurance business accounted for 3.5% of our total net revenues in the first quarter of 2020.

 

●

Net revenues for the claims adjusting business were RMB72.4 million (US$10.2 million) for the first quarter of 2020, representing a decrease of 2.7% from RMB74.4 million for the corresponding period in 2019. The decrease was mainly due to the decline in auto-insurance related claims adjusting business, offsetting the growth in our medical insurance-related claims adjusting business. Revenues generated from the claims adjusting business accounted for 10.0% of our total net revenues in the first quarter of 2020.

 

Total operating costs and expenses were RMB662.6 million (US$93.6 million) for the first quarter of 2020, representing a decrease of 21.6% from RMB845.2 million for the corresponding period in 2019.

 

●

Commission costs were RMB490.9 million (US$69.3 million) for the first quarter of 2020, representing a decrease of 26.6% from RMB668.7 million for the corresponding period in 2019. The decrease in commission cost was mainly in line with the decrease of life insurance business.

 

♦

Costs of the life insurance business were RMB427.4 million (US$60.4 million) for the first quarter of 2020, representing a decrease of 28.9% from RMB601.5 million for the corresponding period in 2019. The decrease was in line with the decline in net revenues generated from our life insurance business. Costs incurred by the life insurance business accounted for 87.1% of our total commission costs in the first quarter of 2020.

 

♦

Costs of the P&C insurance business were RMB16.7 million (US$2.4 million) for the first quarter of 2020, representing a decrease of 32.1% from RMB24.6 million for the corresponding period in 2019. The costs of the P&C insurance business mainly represent commission costs we incurred for operating Baowang (www.baoxian.com). The decrease was in line with the decrease in net revenues generated from our P&C insurance business. Costs incurred by the P&C insurance business accounted for 3.4% of our total commission costs in the first quarter of 2020.

 

♦

Costs of claims adjusting business were RMB46.8 million (US$6.6 million) for the first quarter of 2020, representing an increase of 9.9% from RMB42.6 million for the corresponding period in 2019. Costs incurred by the claims adjusting business accounted for 9.5% of our total commission costs in the first quarter of 2020. The increase was due to the growth in our medical insurance-related claims adjusting business, which has a relatively lower margin.

 

 

 

 

●

Selling expenses were RMB61.3 million (US$8.7 million) for the first quarter of 2020, representing a decrease of 5.1% from RMB64.6 million for the corresponding period in 2019.

 

●

General and administrative expenses were RMB110.4 million (US$15.6 million) for the first quarter of 2020, representing a decrease of 1.3% from RMB111.9 million for the corresponding period in 2019.

 

As a result of the preceding factors, we had an operating income of RMB60.0 million (US$8.5 million) for the first quarter of 2020, representing a decrease of 52.5% from RMB126.4 million for the corresponding period in 2019.

 

Operating margin was 8.3% for the first quarter of 2020, compared to 13.0% for the corresponding period in 2019.

 

Investment income was RMB8.9 million (US$1.3 million) for the first quarter of 2020, representing a decrease of 75.8% from RMB36.8 million for the corresponding period in 2019. The investment income in the first quarter of 2020 consisted of yields from short-term investments in financial products. The decrease in yields from short-term investments in financial products was mainly due to (i) changes in composition of our short-term investment portfolio, with increased allocation to wealth management products issued by banks which offer relatively lower yields as compared to other financial products in the portfolio; (ii) a year-over-year decrease in yields from wealth management products issued by banks; (iii) a decrease in cash available for investment in short-term investment products due to the share buyback program of 2019. Our investment income fluctuates from quarter to quarter because investment income is recognized when investments matured or disposed.

 

Interest income was RMB2.9 million (US$0.4 million) for the first quarter of 2020, representing an increase of 590.9% from RMB0.4 million for the corresponding period in 2019. The increase in interest income in the first quarter of 2020 was mainly due to (i) the increase in bank deposits; and (ii) short-term loans amounted to RMB60.0 million with 10% annual interest rate.

 

Income tax expense was RMB18.7 million (US$2.6 million) for the first quarter of 2020, representing a decrease of 56.4% from RMB42.9 million for the corresponding period in 2019. The effective tax rate for the first quarter of 2020 was 25.3% compared with 26.0% for the corresponding period in 2019.

 

Share of loss of affiliates was RMB12.3 million (US$1.7 million) for the first quarter of 2020, compared with share of income of affiliates of RMB25.4 million for the corresponding period in 2019, mainly attributable to a loss from CNFinance due to the increase in its provision for credit loss as a result of (i) the impact of the new current expected credit loss (“CECL”) model that took into account the deterioration in the economic outlook caused by the COVID-19 pandemic, and (ii) an increase in the amount of non-performing loans as a result of the inefficient legal proceedings due to the COVID-19 pandemic.

 

Net income was RMB42.8 million (US$6.0 million) for the first quarter of 2020, representing a decrease of 71.0% from RMB147.7 million for the corresponding period in 2019.

 

Net income attributable to the Company’s shareholders was RMB45.8 million (US$6.5 million) for the first quarter of 2020, representing a decrease of 68.9% from RMB147.3 million for the corresponding period in 2019. The decrease was mainly due to the decreases in operating income and investment income and share of loss of affiliates.

 

 

 

 

Net margin was 6.3% for the first quarter of 2020 as compared to 15.2% for the corresponding period in 2019.

 

Basic and diluted net income per ADS were RMB0.85 (US$0.12) and RMB0.85 (US$0.12) for the first quarter of 2020, respectively, representing decreases of 67.6% and 67.6% from RMB2.62 and RMB2.62 for the corresponding period in 2019.

 

As of March 31, 2020, the Company had RMB1,843.2 million (US$260.3 million) in cash, cash equivalents and short-term investments.

 

Key Operational Metrics for Fanhua’s Online Initiatives in the First Quarter of 2020:

 

●

Lan Zhanggui - Our one-stop insurance service platform:

 

Ø

The number of registered users of Lan Zhanggui was 1.2 million as of March 31, 2020, representing an increase of 35.9% from 860,550 as of March 31, 2019;

 

The number of active users of Lan Zhanggui2 was 34,278 in the first quarter of 2020, as compared to 61,468 in the corresponding period of 2019. The number of active users of Lan Zhanggui who have sold at least one life insurance policy was 30,489 in the first quarter of 2020, as compared to 52,529 in the corresponding period of 2019;

 

Ø

Insurance premiums generated through Lan Zhanggui were RMB451.7 million (US$63.8 million) in the first quarter of 2020, among which life insurance premiums was RMB438.4 million (US$61.9 million) and non-life insurance premiums were RMB13.4 million (US$1.9 million), respectively, as compared to RMB887.5 million total insurance premiums generated through Lan Zhanggui which included RMB757.4 million life insurance premiums and RMB130.0 million non-life insurance premiums in the corresponding period of 2019.

 

●

eHuzhu - Our online mutual aid platform:

 

Ø

The number of paying members was 3.4 million as of March 31, 2020, as compared to 3.5 million as of March 31, 2019.

 

●

Baowang (www.baoxian.com) - Our online insurance platform:

 

Ø

The number of registered customer accounts was 2.8 million as of March 31, 2020, representing an increase of 21.7% from approximately 2.3 million as of March 31, 2019;

 

2

Active users of Lan Zhanggui included users who sold at least one insurance policy through Lan Zhanggui (through either its mobile application or WeChat public account) during the specific period.

 

 

 

 

Ø

The number of active customer accounts3 was 142,004 in the first quarter of 2020, representing an increase of 71.4% from 82,869 in the corresponding period of 2019;

 

Ø

Insurance premiums generated on Baoxian.com was RMB69.3 million (US$9.8 million) in the first quarter of 2020 as compared to RMB90.2 million in the corresponding period of 2019.

 

Recent Developments

 

●

As of March 31, 2020, Fanhua had 650,065 sales agents and 1,668 professional claims adjusters, compared with 860,550 sales agents and 1,213 claims adjusters as of March 31, 2019. The decrease in the number of sales agents was mainly due to our efforts to clean up sales force and focus more on higher quality sales agents. The number of performing agents4 was 95,932, and the number of performing agents for selling life insurance products was approximately 33,152 in the first quarter of 2020. As of March 31, 2020, Fanhua’s distribution network consisted of 763 sales outlets in 21 provinces and 159 services outlets in 31 provinces, compared with 709 sales outlets in 21 provinces and 143 service outlets in 31 provinces as of March 31, 2019.

 

Business Outlook

 

Fanhua expects its operating income to be no less than RMB70.0 million for the second quarter of 2020. This forecast is based on the current market conditions and reflects Fanhua’s preliminary estimate, which is subject to change caused by various uncertainties, including those related to the ongoing COVID-19 pandemic.

 

Conference Call

 

The Company will host a conference call to discuss its first quarter 2020 financial results as per the following details.

 

Time: 9:00 PM Eastern Daylight Time on May 26, 2020

or 9:00 AM Beijing/Hong Kong Time on May 27, 2020

 

Due to the outbreak of COVID-19, operator-assisted conference calls are not available at the moment. Please pre-register online in advance to join the conference call by navigating to the link provided below and dial-in 10 minutes before the call is scheduled to begin. Conference call details will be provided upon registration.

 

3	Active customer accounts are defined as customer accounts that made at least one purchase directly throughwww.baoxian.com, its mobile application, or WeChat public account during the specified period.
4	Performing agents are defined as agents who have sold at least one insurance policy during the specified period.

 

 

 

 

Conference Call Preregistration: http://apac.directeventreg.com/registration/event/2348224

 

Additionally, a live and archived webcast of the conference call will be available at Fanhua’s investor relations website https://edge.media-server.com/mmc/p/25m7duce

 

About Fanhua Inc.

 

Fanhua Inc. is a leading independent financial services provider. Through our online platforms and offline sales and service network, we offer a wide variety of financial products and services to individuals, including life and property and casualty insurance products. We also provide insurance claims adjusting services, such as damage assessments, surveys, authentications and loss estimations, as well as value-added services, such as emergency vehicle roadside assistance.

 

Our online platforms include: (1) Lan Zhanggui, an all-in-one platform which allows our agents to access and purchase a wide variety of insurance products, including life insurance, auto insurance, accident insurance, travel insurance and standard health insurance products from multiple insurance companies on their mobile devices; (2) Baowang (www.baoxian.com), an online entry portal for comparing and purchasing short term health, accident, travel and homeowner insurance products and (3) eHuzhu (www.ehuzhu.com), a non-profit online mutual aid platform in China.

 

As of March 31, 2020, our distribution and service network is consisted of 763 sales outlets covering 21 provinces and 159 service outlets covering 31 provinces.

 

For more information about Fanhua Inc., please visit http://ir.fanhuaholdings.com/.

 

Forward-looking Statements

 

‘This press release contains statements of a forward-looking nature. These statements, including the statements relating to the Company’s future financial and operating results, are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as “will,” “expects,” “believes,” “anticipates,” “intends,” “estimates” and similar statements. Among other things, management's quotations and the Business Outlook section contain forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about Fanhua and the industry. Potential risks and uncertainties include, but are not limited to, those relating to its ability to attract and retain productive agents, especially entrepreneurial agents, its ability to maintain existing and develop new business relationships with insurance companies, its ability to execute its growth strategy, its ability to adapt to the evolving regulatory environment in the Chinese insurance industry, its ability to compete effectively against its competitors, quarterly variations in its operating results caused by factors beyond its control and macroeconomic conditions in China, future development of COVID-19 outbreak and their potential impact on the sales of insurance products. All information provided in this press release is as of the date hereof, and Fanhua undertakes no obligation to update any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although Fanhua believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results. Further information regarding risks and uncertainties faced by Fanhua is included in Fanhua's filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F.

 

 

FANHUA INC.
Unaudited Condensed Consolidated Balance Sheets
(In thousands)

 

		As of December 31,				As of March 31,				As of March 31,
		20195				2020				2020
		RMB				RMB				US$
ASSETS:
Current assets:
Cash and cash equivalents			169,653				503,323				71,083
Restricted cash			95,952				123,037				17,376
Short term investments			1,612,351				1,339,915				189,232
Accounts receivable, net			682,171				490,520				69,275
Insurance premium receivables			5,067				660				93
Other receivables			61,570				117,629				16,612
Other current assets			54,987				46,143				6,517
Total current assets			2,681,751				2,621,227				370,188
Non-current assets:
Property, plant, and equipment, net			40,806				38,568				5,447
Goodwill and intangible assets, net			110,191				109,970				15,531
Deferred tax assets			7,327				10,188				1,439
Investment in affiliates			363,414				351,925				49,701
Other non-current assets			46,917				46,170				6,520
Right of use assets			190,437				192,338				27,163
Total non-current assets			759,092				749,159				105,801
Total assets			3,440,843				3,370,386				475,989
Current liabilities:
Accounts payable			382,882				269,913				38,119
Insurance premium payables			7,901				25,980				3,669
Other payables and accrued expenses			220,290				210,638				29,748
Accrued payroll			101,664				79,233				11,190
Income tax payable			155,251				160,867				22,719
Dividend payable			—				114,060				16,108
Current operating lease liability			79,986				80,557				11,377
Total current liabilities			947,974				941,248				132,930
Non-current liabilities:
Refundable share rights deposits			266,901				271,464				38,338
Other tax liabilities			70,350				67,219				9,493
Deferred tax liabilities			7,898				12,648				1,786
Non-current operating lease liability			103,252				104,875				14,811
Total non-current liabilities			448,401				456,206				64,428
Total liabilities			1,396,375				1,397,454				197,358
Ordinary shares			9,235				9,235				1,304
Treasury stock			(1,146	)			(1,146	)			(162	)
Additional paid-in capital			393				492				69
Statutory reserves			508,739				508,739				71,848
Retained earnings			1,479,494				1,403,704				198,241
Accumulated other comprehensive loss			(65,429	)			(58,298	)			(8,233	)
Total shareholders’ equity			1,931,286				1,862,726				263,067
Non-controlling interests			113,182				110,206				15,564
Total equity			2,044,468				1,972,932				278,631
Total liabilities and equity			3,440,843				3,370,386				475,989

 

5

In June 2016, FASB issued ASU No. 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. This standard requires entities to measure all expected credit losses of financial assets held at a reporting date based on historical experience, current conditions, and reasonable and supportable forecasts in order to record credit losses in a timelier manner. ASU 2016-13 also amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 adds to U.S. GAAP an impairment model (known as the current expected credit loss (CECL) model) that is based on expected losses rather than incurred losses. The Company adopted the ASU No. 2016-13 on a modified-retrospective basis, the cumulative-effect adjustment reduce opening retained earnings balance by approximately RMB7.4million in the statement of financial position as of January 1, 2020.

 

 

 

FANHUA INC.

Unaudited Condensed Consolidated Statements of Income and Comprehensive Income
(In thousands, except for shares and per share data)

 

		For The Three Months Ended
		March 31,
		2019				2020				2020
		RMB				RMB				US$
Net revenues:
Agency		897,304				650,211				91,827
Life insurance business		859,185				625,205				88,296
P&C insurance business			38,119				25,006				3,531
Claims adjusting			74,350				72,412				10,227
Total net revenues			971,654				722,623				102,054
Operating costs and expenses:
Agency			(626,097	)			(444,097	)			(62,718	)
Life insurance Business			(601,482	)			(427,419	)			(60,363	)
P&C insurance Business			(24,615	)			(16,678	)			(2,355	)
Claims adjusting			(42,597	)			(46,816	)			(6,612	)
Total operating costs			(668,694	)			(490,913	)			(69,330	)
Selling expenses			(64,642	)			(61,255	)			(8,651	)
General and administrative expenses			(111,895	)			(110,411	)			(15,593	)
Total operating costs and expenses			(845,231	)			(662,579	)			(93,574	)
Income from operations			126,423				60,044				8,480
Other income, net:
Investment income			36,825				8,860				1,251
Interest income			419				2,895				409
Others, net			1,449				2,014				285
Income from operations before income taxes and share income of affiliates			165,116				73,813				10,425
Income tax expense			(42,863	)			(18,657	)			(2,635	)
Share of income (loss) of affiliates			25,413				(12,339	)			(1,743	)
Net income			147,666				42,817				6,047
Less: net  income (loss) attributable to noncontrolling interests			398				(2,976	)			(420	)
Net income attributable to the Company’s shareholders			147,268				45,793				6,467

 

 

 

 

FANHUA INC.

Unaudited Condensed Consolidated Statements of Income and Comprehensive Income-(Continued)

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

 

		For The Three Months Ended
		March 31,
		2019				2020				2020
		RMB				RMB				US$
Net income per share:
Basic			0.13				0.04				0.01
Diluted			0.13				0.04				0.01
Net income per ADS:
Basic			2.62				0.85				0.12
Diluted			2.62				0.85				0.12
Shares used in calculating net income per share:
Basic			1,122,290,708				1,073,891,784				1,073,891,784
Diluted			1,123,329,865				1,074,291,427				1,074,291,427
Net income			147,666				42,817				6,047
Other comprehensive income (loss), net of tax: Foreign currency translation adjustments			(4,747	)			3,720				525
Share of other comprehensive gain (loss) of affiliates			(1,278	)			850				120
Unrealized net gains on available-for-sale investments			—				2,561				362
Comprehensive income			141,641				49,948				7,054
Less: Comprehensive income (loss) attributable to the noncontrolling interests			398				(2,976	)			(420	)
Comprehensive income attributable to the Company’s shareholders			141,243				52,924				7,474

 

 

 

 

FANHUA INC.

Unaudited Condensed Consolidated Statements of Cash Flow

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

 

		For The Three Months Ended
		March 31,
		2019				2020				2020
		RMB				RMB				US$
OPERATING ACTIVITIES
Net income			147,666				42,817				6,047
Adjustments to reconcile net income to net cash generated from operating activities:
Investment income			(32,899	)			(5,102	)			(721	)
Share of (income) loss of affiliates			(25,413	)			12,339				1,743
Other non-cash adjustments			24,852				33,064				4,670
Changes in operating assets and liabilities			(67,394	)			51,444				7,264
Net cash generated from operating activities			46,812				134,562				19,003
Cash flows from investing activities:
Purchase of short term investments			(1,604,900	)			(2,780,732	)			(392,714	)
Proceeds from disposal of short term investments			1,824,222				3,060,832				432,272
Cash paid for loan receivables to a third party			—				(60,000	)			(8,474	)
Others			(4,404	)			(2,189	)			(309	)
Net cash generated from investing activities			214,918				217,911				30,775
Cash flows from financing activities:
Repurchase of shares from open market			(82,381	)			—				—
Proceeds of cash consideration related to disposal of subsidiaries			5,000				—				—
Subscription of 650 million ADSs to Participants upon 521 Plan			111,305				—				—
Net cash generated from financing  activities			33,924				—				—
Net increase in cash and cash equivalents, and restricted cash			295,654				352,473				49,778
Cash and cash equivalents and restricted cash at beginning of year			848,166				265,605				37,511
Effect of exchange rate changes on cash and cash equivalents			(4,524	)			8,282				1,170
Cash and cash equivalents and restricted cash at end of year			1,139,296				626,360				88,459

 

 

 

 

For more information, please contact:

 

Investor Relations

 

Tel: +86 (20) 8388-3191

 

Email: qiusr@fanhuaholdings.com

 

Source: Fanhua Inc.

 

 

Page 12 of 12

 

Exhibit 99.2

 

 

 

Fanhua Announces Quarterly Cash Dividend of US$0.25 per ADS for the First Quarter of 2020

 

GUANGZHOU, China, May 26, 2020, Eastern Daylight Time, (GLOBE NEWSWIRE) -- The board of directors of Fanhua Inc. (“Fanhua” or “the Company”) (Nasdaq: FANH), a leading independent financial services provider in China, today announced that its Board of Directors (the “Board”) has declared a quarterly dividend of US$0.0125per ordinary share, or US$0.25 per ADS for the first quarter of 2020. The dividend is payable on or around Jun 24, 2020 to shareholders of record on Jun 10, 2020.

 

About Fanhua Inc.

 

Fanhua Inc. is a leading independent financial services provider. Through our online platforms and offline sales and service network, we offer a wide variety of financial products and services to individuals, including life and property and casualty insurance products. We also provide insurance claims adjusting services, such as damage assessments, surveys, authentications and loss estimations, as well as value-added services, such as emergency vehicle roadside assistance.

 

Our online platforms include: (1) Lan Zhanggui, an all-in-one platform which allows our agents to access and purchase a wide variety of insurance products, including life insurance, auto insurance, accident insurance, travel insurance and standard health insurance products from multiple insurance companies on their mobile devices; (2) CNpad, a mobile sales support application for auto insurance; (3) Baowang (www.baoxian.com), an online entry portal for comparing and purchasing short term health, accident, travel and homeowner insurance products and (4) eHuzhu (www.ehuzhu.com), a non-profit online mutual aid platform in China.

 

As of March 31, 2019, our distribution and service network is consisted of 763 sales outlets covering 22 provinces and 159 service outlets covering 31 provinces.

 

For more information about Fanhua Inc., please visit http://ir.fanhuaholdings.com/.

  

Forward-looking Statements

 

This press release contains statements of a forward-looking nature. These statements, including the statements relating to the Company’s future financial and operating results, are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as “will,” “expects,” “believes,” “anticipates,” “intends,” “estimates” and similar statements. Among other things, management’s quotations and the Business Outlook section contain forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about Fanhua and the industry. Potential risks and uncertainties include, but are not limited to, Fanhua’s ability to attract and retain key personnel and productive agents, its ability to maintain existing and develop new business relationships with insurance companies, its ability to execute its growth strategy, its ability to adapt to the evolving regulatory environment in the Chinese insurance industry, its ability to compete effectively against its competitors, quarterly variations in its operating results caused by factors beyond its control and macroeconomic conditions in China, future development of COVID-19 outbreak and their potential impact on the sales of insurance products. All information provided in this press release is as of the date hereof, and Fanhua undertakes no obligation to update any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although Fanhua believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results. Further information regarding risks and uncertainties faced by Fanhua is included in Fanhua’s filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F.

 

CONTACT: Investor Relations

Tel: (8620) 83883191

Email: qiusr@fanhuaholdings.com