Attaching importance to shareholder returns and continuing the dividend policy, Jiayin Technology's revenue in 2023 increased by 67.1%

Zhitong Financial APP learned that Jiayin Technology (JFIN.US) recently released its 2023 financial report, with revenue and profit both hitting a new high, achieving operating income of 5.47 billion yuan, an increase of 67.1% year-on-year, net profit of 1.298 billion yuan, and net profit margin of 23.73%, during which the company facilitated transactions of about 88.1 billion yuan, a year-on-year increase of 58.7%.

Jiayin Technology has achieved strong performance, maintained steady growth for 12 consecutive quarters, actively paid dividends to shareholders, announced two dividends in cash, and distributed a total of about US$42.7 million in cash in the past two dividends, accounting for 25% of the net profit after tax in 2022. In addition, the company has boosted investor confidence through buybacks, which have repurchased $10.6 million so far and raised the buyback cap to $30 million.

The company's management is confident about the future and expects the full-year 2024 lending target to increase to 93 billion to 98 billion yuan, including 22 billion yuan in the first quarter. Yan Dinggui, chairman of the company, said that in 2024, it is expected to continue to return greater value to shareholders by maintaining or increasing dividends when market conditions improve.

The performance is high, and the user stickiness is stable

From 2020 to 2023, Jiayin Technology's revenue increased from 1.3 billion yuan to 5.47 billion yuan, and shareholders' net profit increased from 253 million yuan to 1.298 billion yuan, with a compound growth rate of 61.44% and 72.47% respectively. In 2023, the company facilitated loan transactions amounting to 88.1 billion yuan, maintaining a double-digit compound growth.

In fact, the company uses big data, cloud computing, artificial intelligence and other technologies to connect consumers and financial institutions in consumption scenarios, realize institutional business empowerment, and meet the borrowing needs of financing users. As of the end of 2023, Jiayin Technology has established cooperative relations with 71 financial institutions and is in the process of negotiating with another 36 financial institutions. Among the key partners, the company has completed the access of 1 Internet bank, 2 large city commercial banks and a number of private banks in Q4, further enriching the source of funds for the loan business.

The company actively explores multiple cooperation models with financial institutions, deepens all-round cooperation in the fields of operation, technology, risk management and consumer rights protection, and explores more technology application scenarios in addition to promoting loans, such as empowering financial institutions to build digitally. The proposal of new quality productivity in 2024 is expected to accelerate the digitalization of the financial industry, which may bring huge cooperation opportunities to the company.

On the one hand, it accurately matches financial institutions through financial technology and AI technology, increases the proportion of high-quality users and optimizes the customer base, and on the other hand, it increases the development of different user groups for financial institutions, especially the micro, small and medium-sized enterprises market, and continuously increases the financing proportion of micro, small and medium-sized enterprises. In 2023, its user stickiness will be further stabilized, with a repeat borrowing ratio of 72.9% and an average loan amount of 9,944 yuan, both of which will maintain a growth trend.

The company has built an efficient bridge between users and financial institutions, and formed a virtuous closed loop, with multiple feedback, institutions are willing to lend more funds to promote the sustainable growth of the scale of loans. At the same time, the company has significantly reduced customer acquisition costs through refined advertising strategies, elimination and adjustment of long-tail channels, and improved conversion rates, such as 11.9% year-on-year decrease in marketing expenses in Q4 2023, improving profitability.

It is worth mentioning that Jiayin Technology adopts a globalization strategy to increase the development of overseas markets and expand the growth space. In the Nigerian market, achieving a breakthrough in business scale is quite challenging under the premise of local exchange rate fluctuations and market risk fluctuations. The company is also actively looking for opportunities in potential pan-African markets such as Tanzania, especially in Indonesia, where local regulators have put forward new requirements for lower rates, which may be another key market for the company.

AI strengthens financial technology, and quarterly expenses continue to be optimized

Jiayin Technology can be recognized by financial institutions and users, the core is that financial technology is in the leading position in the industry, its Jirong has nearly ten years of technical accumulation, has Internet credit system, risk control decision-making engine and AI algorithm modeling and other industry-leading financial technology products, and is increasing R&D investment every year, and the product results are remarkable. In 2023, the company's R&D expenses increased by 36.4% year-on-year, and the R&D expense ratio was 5.41%.

In 2023, AI will usher in a wave of development, and the empowerment of AI technology in the industry mainly includes multiple dimensions such as anti-fraud monitoring, marketing and customer acquisition delivery models, and intelligent quality inspection of customer service. The company took the lead in the layout, first renamed Jiayin Financial Technology to "Jiayin Technology", in line with the development trend of cutting-edge technology represented by artificial intelligence in the domestic and foreign markets, and then took the lead in launching competitive AI products in the industry to seize market opportunities.

For example, the company launched its self-developed "Nuwa" intelligent agent assistance platform, which has been in a leading position in related fields since its launch. It uses technologies such as speech-to-text, natural language processing, large models, and vector knowledge bases to provide agents in different business fields with digital intelligence services such as real-time risk reminders, product knowledge recommendations, and automatic conversation summaries, improving the work efficiency of agents and the quality and efficiency of enterprise operations.

In 2023, the company's 61 to 90-day overdue rate will remain low at 0.68% and better than the industry average. In addition, the company applied its self-developed technology to the anti-fraud link, and in 2023, it identified and intercepted about 415,900 high-risk inertial fraud applications, and manually investigated and handled more than 52,000 potentially high-risk customer applications, blocking the fraud chain in advance.

In fact, with its excellent financial technology strength, Jiayin Technology has been recognized by the industry and empowered partners and business improvements, driving the growth of revenue scale while comprehensively optimizing various expenses. On a quarterly basis, in Q4 2023, thanks to refined management, the company's core sales expense ratio and administrative expense ratio were 20.59% and 4.06%, respectively, a year-on-year decrease of 14.9 and 1.54 percentage points.

Adhere to sustainable development and attach importance to shareholder returns

For example, since 2021, Jiayin Financial Technology has cooperated with the Shanghai Soong Ching Ling Foundation to set up the Jiajing Charity Fund to help the mental health development of adolescents, and has also paid attention to special groups with special difficulties, and set up a special green channel for customers facing difficulties due to special circumstances such as major diseases, unemployment, and unexpected disasters to provide relief assistance. In 2023, the company will help 9,900 customers in difficulty, including a total of 592 customers in major natural disaster areas such as Beijing, Hebei, and Gansu.

Consumer protection is at the heart of the fintech industry, and the company's consumer protection efforts throughout 2023 have been throughout. According to the 2023 consumer protection white paper disclosed by it, in 2023, the "Qimingxing" system will increase the risk warning level more than 110 times, the cumulative number of external risks will be more than 47,000 times, the risk will be manually controlled in a timely manner about 330 times, and the identification accuracy will be increased to more than 95%, providing strong support for the fight against the financial black industry. The company has served 4380137 customers throughout the year, with a satisfaction rate of 98.34%, and various consumer protection education covers 26 million person-times.

At the same time of sustainable development, Jiayin Technology also actively improves shareholder returns, announcing a policy of paying dividends twice a year, and the dividend payout ratio is not less than 15%, and implements it, accounting for a total of 25% in the past two dividends, you must know that the company's current valuation level PE (TTM) is less than 2 times, and the attractive dividend will greatly push up the level of shareholder returns. And the company's market cap premium returns are high, with a 2.3 times increase in market value since 2022.

Jiayin Technology's performance has increased rapidly, attaches great importance to sustainable development, and the results of ESG and consumer protection work are highlighted, and the market value is expected to continue to move out of the trend under the temptation of the twice-a-year dividend policy, increased buybacks and low valuations.