Market Newsdesk

MARTINSVILLE, Va., June 08, 2023 (GLOBE NEWSWIRE) — Hooker Furnishings Corporation (NASDAQ-GS: HOFT), a global leader in the design, production, and marketing of home furnishings for nearly a century, today reported operating results for its fiscal 2024 first quarter ended April 30, 2023.

Fiscal 2024 First Quarter overview:

• Consolidated net sales for the quarter were $121.8 million, a $25.5 million, or 17.3%, decrease compared to a year ago. An expected revenue reduction was driven by a 32.5% sales decrease in the Home Meridian (HMI) segment and, to a lesser extent, a 14.8% decrease in first quarter year-over-year Domestic Upholstery sales. Net sales in the Hooker Branded segment remained relatively unchanged.

• Consolidated net income was $1.5 million, or $0.13 per diluted share for the quarter, compared to $3.2 million, or $0.26 per diluted share, in the prior year period. Consolidated operating income for the quarter was $2 million compared to $3.9 million in the same quarter a year ago.

• The Company strengthened its financial position during the quarter by generating $22.4 million in cash from operating activities and funded $4.5 million in capital expenditures and the continued development of our ERP system, $4.3 million in share repurchases, and $2.4 million in cash dividends.

• Inventory levels decreased by $23 million during the quarter, well on the way toward a goal of reducing inventories by $30 million before fiscal year-end.

• The Hooker Branded and Domestic Upholstery segments and All Other were profitable for the quarter. Home Meridian’s operating loss of $2.1 million, resulting from lower sales volume, improved by $1 million compared to the same period a year ago.

• The grand opening of a nearly 120,000-square-foot new Hooker Legacy Showroom in the Showplace Building at the Spring High Point Market generated a 93% increase in year-over-year retailer traffic, with successful product launches across all brands.
  

Management Commentary

“Considering the softer retail environment, economic uncertainties and our recent exit from the Accentrics Home (ACH) line, we’re pleased to have exceeded internal and external expectations for sales and earnings this quarter,” said Jeremy Hoff, chief executive officer and director of Hooker Furnishings. “Our liquidation of ACH inventories and other obsolete inventories at HMI is about 80% complete as of May end, which is helping us reduce our domestic warehousing footprint and make progress towards getting profitability back on track at HMI. We generated $22.4 million in cash during the quarter, and we are continuing to build cash currently as we further reduce inventories. Recent cash levels have increased by about $15 million since the end of our first quarter.”

“Our new Hooker Legacy Showroom Grand Opening at the April High Point Market achieved what we intended, as we nearly doubled our attendance from a year ago and attracted new customers,” Hoff said. “Many of our strategic organic growth initiatives that will enable us to broaden our total addressable market and visibility are tied to the new showroom and the Hooker Legacy Brands,” he added. One of those strategic growth initiatives, the High Point Market launch of the ‘M’ domestically produced upholstery and imported occasional furniture brand, “surpassed our expectations,” Hoff said. “This new brand, combining the unique capabilities of HF Custom, Shenandoah, Bradington-Young and Hooker Casegoods, will enable us to compete in a modern lifestyle aesthetic without disrupting any of those core businesses. Retailers affirmed to us that the new M brand is very much on-point with the up-and-coming casual modern lifestyle that today’s younger consumer is gravitating towards.”

Segment Reporting: Hooker Branded

• The Hooker Branded segment’s net sales remained relatively unchanged, decreasing slightly by 0.8% or $339,000, compared to the prior year’s first quarter. Gross profit and margin also remained flat.

• Net sales were negatively impacted by higher discounting compared to abnormally lower levels of discounting in the prior year period. While we benefitted from the price increases implemented in the prior year to mitigate product cost inflation, discounting increased by 230 bps from the prior year due to softer demand in the current quarter.

• Higher demurrage and drayage expenses, which heavily impacted the gross margin in previous quarters, were still higher than the prior-year first quarter but are trending down.

• At the end of the first quarter, Hooker Branded inventory levels decreased by $14 million compared to the fiscal 2023 year-end. Inventories were still elevated at quarter-end and higher than pre-pandemic levels in calendar year 2019. “We are actively working to reduce inventory levels to align with current demand, however our inventory management process is working well, so we’re in stock on most best-selling items and inventory obsolescence is not an issue.” said Paul Huckfeldt, senior vice president and chief financial officer.

• Quarter-end backlog for Hooker Branded was lower than the prior-year first-quarter end but remained 50% higher than pre-pandemic levels at fiscal 2020 first quarter end. Incoming orders decreased by 16.6% as compared to the prior-year quarter and approached levels similar to fiscal 2020 first quarter, reflecting normalized demand after the pandemic.

Segment Reporting: Home Meridian (HMI)

“The sales decrease at HMI was better than our expectations,” said Hoff. “While disappointing, the operating loss of $2.1 million was a $1 million improvement compared to the prior-year first quarter, and also was better than we expected,” he said.

“Our transition to a new business model at HMI will continue into this year as we move away from higher-risk businesses to focus on our core strengths and core businesses – Pulaski, Samuel Lawrence Furniture (SLF), Samuel Lawrence Hospitality (SLH) and Prime Resources International (PRI, which is transitioning to a container-direct-only model). We believe we are on track to achieve profitability in this segment by the end of the fiscal year,” Hoff added.

• Net sales at HMI decreased by $20.2 million, or 32.5%, compared to the prior year’s first quarter, driven by sales decreases with major furniture chains and mass merchants in a slower retail environment for home furnishings. Other contributing factors to the lower sales included lower selling prices due to liquidation sales, and delayed orders from retail customers as they continue to reduce excess inventory.

• Inventories decreased $9 million from the end of fiscal 2023, due to liquidation of obsolete inventories and efforts to align inventory levels with current demand.

• On the positive side, SLH’s net sales more than doubled compared to the prior-year quarter, indicating a strong recovery in the hospitality industry after the COVID pandemic. Additionally, freight costs improved due to the stabilization of ocean freight rates.

• Also on a positive note, Hooker Furnishings and leading lifestyle and entertainment company Scott Brothers Global announced in April the renewal of their multi-year licensing agreement in which HMI’s Pulaski and SLF divisions serve as the exclusive bedroom, dining, and occasional furniture suppliers for the Drew & Jonathan Home brand. “With the major retail placements, we are expecting significant short and long-term sales growth for the Drew & Jonathan Home brand,” Hoff said.

• Incoming orders and quarter-end backlog at HMI were lower than the prior year quarter and fiscal 2020 first quarter, due to the absence of orders from the Club channel (which HMI exited during fiscal 2022) and the ACH business, as well as decreased incoming orders from the retail customers.

Segment Reporting: Domestic Upholstery

• After 10 consecutive quarters of year-over-year sales increases in Domestic Upholstery, the segment experienced its first quarterly sales decline in over two years, a decrease of $6.1 million, or 14.8% compared to last year’s first quarter. Sales reductions at HF Custom, Sunset West and Shenandoah were partially offset by increased net sales at Bradington-Young.

• Sales decreases at Sunset West are attributed to non-recurring factors including slowed shipments in February and March caused by the December conversion to a new ERP system and the expansion of the outdoor furniture brand to the East Coast, which involved transition issues and start-up delays in the Georgia distribution center. These issues were mostly resolved by the end of the first quarter.

“Much of the Domestic Upholstery sales dip was driven by the fact that we worked through our large backlogs in the divisions, and then experienced softer demand. We do not think it is a long-term situation,” Hoff said. “The temporary slowdown at Sunset West occurred due to transitioning to a new ERP system and bi-coastal distribution. Now that this transition is largely complete, Sunset West is expanding to a nationally distributed brand, which we believe offers a double-digit organic growth opportunity over multiple years,” Hoff added.

• Despite the sales decline and disruptions, the Domestic Upholstery segment reported operating income of $1.3 million and operating margin of 3.8%.

• Quarter-end backlog for Bradington-Young remained over three times higher than pre-pandemic levels at fiscal 2020 first- quarter end, while the backlogs for HF Custom and Shenandoah decreased to levels similar to fiscal 2020. Incoming orders at Bradington-Young and Shenandoah were at similar levels in fiscal 2020, while HF Custom experienced lower orders compared to this period.

Cash, Debt, and Inventory

Cash and cash equivalents stood at $31 million at fiscal 2024 first quarter-end, an increase of $12 million from the prior year-end. During the first quarter, the Company used a portion of the $22.4 million cash generated from operating activities to fund $4.3 million of share repurchases, $3.2 million in capital expenditures including investments in its new showroom, $2.4 million in cash dividends to shareholders, and $1.3 million for development of its cloud-based ERP system. “In addition to our cash balance, we have an aggregate of $27.2 million available under our existing revolver at quarter-end to fund working capital needs. We believe that our liquidity and capital requirements will be further improved through the liquidation sales of remaining excess inventories at HMI,” said Huckfeldt.

Capital Allocation

“We’re pleased with the progress we’ve made reducing inventories, which was a large part of the cash we generated during the quarter. Since the repurchase program’s announcement around this time last year, we have returned approximately $20 million to our shareholders and retired 1.2 million shares. Our board recently approved an additional $5 million authorization as part of our capital allocation plan for this year. In addition to continuing to execute the share repurchase plan, our capital allocation priorities include building cash reserves, funding the organic growth initiatives noted earlier, continuing our dividend, and funding typical capital expenditures,” Huckfeldt concluded.

Outlook

“While retail conditions remain mixed along with some economic uncertainties, we saw increases in consolidated incoming orders in May ,” said Hoff, adding that “We believe the industry is getting through some of the elevated inventory challenges and we may be seeing some breakthrough in that area.”

Following its successful new showroom grand opening at the Spring High Point Market, Hooker Furnishings will continue initiatives to enhance visibility and addressable market reach this summer, debuting a new showroom at the Atlanta Market for Hooker Legacy brands. “In addition to opening the new showroom for Legacy brands, Sunset West will also debut a new showroom at the Atlanta Market, which is the new sponsor of the Casual Market for outdoor furniture, relocating from Chicago,” Hoff said. “Hooker Legacy brands will show at its fourth Las Vegas Market this summer as well. At HMI, we expect the previously announced inventory liquidations to be substantially completed by the end of the fiscal 2024 second quarter. While we expect some short-term volatility in sales and earnings at HMI, we continue to expect the segment to achieve profitability by the end of the 2024 fiscal year. The HMI team has rallied around the new level of focus on our core competencies, as we direct our support and resources behind our key businesses while reducing costs.”

“The Hooker Furnishings team continues to focus on organic growth opportunities through expanded visibility, strategic product development, operational improvements and cost reductions,” Hoff said. “By focusing on these controllables, we will be in the strongest possible position when the demand environment improves,” he concluded.

Conference Call Details

Hooker Furnishings will present its fiscal 2024 first quarter financial results via teleconference and live internet webcast on Thursday morning, June 8^th, 2023 at 9:00 AM Eastern Time. A live webcast of the call will be available on the Investor Relations page of the Company’s website at https://investors.hookerfurnishings.com/events and archived for replay. To access the call by phone, participants should go to this link (registration link) and you will be provided with dial in details. To avoid delays, participants are encouraged to dial into the conference call fifteen minutes ahead of the scheduled start time.

Hooker Furnishings Corporation, in its 99th year of business, is a designer, marketer and importer of casegoods (wooden and metal furniture), leather furniture, and fabric-upholstered furniture for the residential, hospitality and contract markets. The Company also domestically manufactures premium residential custom leather and custom fabric-upholstered furniture and outdoor furniture. Major casegoods product categories include home entertainment, home office, accent, dining, and bedroom furniture in the upper-medium price points sold under the Hooker Furniture brand. Hooker’s residential upholstered seating product lines include Bradington-Young, a specialist in upscale motion and stationary leather furniture, HF Custom (formerly Sam Moore Furniture), a specialist in fashion forward custom upholstery offering a selection of chairs, sofas, sectionals, recliners and a variety of accent upholstery pieces, Hooker Upholstery, imported upholstered furniture targeted at the upper-medium price-range and Shenandoah Furniture, an upscale upholstered furniture company specializing in private label sectionals, modulars, sofas, chairs, ottomans, benches, beds and dining chairs in the upper-medium price points for lifestyle specialty retailers. The H Contract product line supplies upholstered seating and casegoods to upscale senior living facilities. The Home Meridian division addresses more moderate price points and channels of distribution not currently served by other Hooker Furnishings divisions or brands. Home Meridian’s brands include Pulaski Furniture, casegoods covering the complete design spectrum in a wide range of bedroom, dining room, accent and display cabinets at medium price points, Pulaski Upholstery, stationary and motion upholstery collections available in fabric and leather covering the complete design spectrum at medium price points, Samuel Lawrence Furniture, value-conscious offerings in bedroom, dining room, home office and youth furnishings, Prime Resources International, value-conscious imported leather upholstered furniture, and Samuel Lawrence Hospitality, a designer and supplier of hotel furnishings. The Sunset West division is a designer and manufacturer of comfortable, stylish and high-quality outdoor furniture. Hooker Furnishings Corporation’s corporate offices and upholstery manufacturing facilities are located in Virginia, North Carolina and California, with showrooms in High Point, N.C., Las Vegas, N.V., Atlanta, G.A. and Ho Chi Minh City, Vietnam. The company operates distribution centers in Virginia, Georgia, and Vietnam. Please visit our websites hookerfurnishings.com, hookerfurniture.com, bradington-young.com, hfcustomfurniture.com, hcontractfurniture.com, homemeridian.com, pulaskifurniture.com, slh-co.com, and sunsetwestusa.com.

Certain statements made in this release, other than those based on historical facts, may be forward-looking statements. Forward-looking statements reflect our reasonable judgment with respect to future events and typically can be identified by the use of forward-looking terminology such as “believes,” “expects,” “projects,” “intends,” “plans,” “may,” “will,” “should,” “would,” “could” or “anticipates,” or the negative thereof, or other variations thereon, or comparable terminology, or by discussions of strategy. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Those risks and uncertainties include but are not limited to: (1) general economic or business conditions, both domestically and internationally, including the current macro-economic uncertainties and challenges to the retail environment for home furnishings along with instability in the financial and credit markets, in part due to rising interest rates, including their potential impact on (i) our sales and operating costs and access to financing or (ii) customers and suppliers and their ability to obtain financing or generate the cash necessary to conduct their respective businesses; (2) difficulties in forecasting demand for our imported products and raw materials used in our domestic operations; (3) risks associated with our reliance on offshore sourcing and the cost of imported goods, including fluctuation in the prices of purchased finished goods, customs issues, freight costs, including the price and availability of shipping containers, ocean vessels, ocean and domestic trucking, and warehousing costs and the risk that a disruption in our offshore suppliers or the transportation and handling industries, including labor stoppages, strikes, or slowdowns, could adversely affect our ability to timely fill customer orders; (4) risks associated with HMI segment restructuring and cost-savings efforts, including our ability to timely dispose of excess inventories, reduce expenses and return the segment to profitability; (5) the impairment of our long-lived assets, which can result in reduced earnings and net worth; (6) adverse political acts or developments in, or affecting, the international markets from which we import products, including duties or tariffs imposed on those products by foreign governments or the U.S. government and possible future U.S. conflict with China; (7) the direct and indirect costs and time spent by our associates associated with the implementation of our Enterprise Resource Planning system, including costs resulting from unanticipated disruptions to our business; (8) the interruption, inadequacy, security breaches or integration failure of our information systems or information technology infrastructure, related service providers or the internet or other related issues including unauthorized disclosures of confidential information, hacking or other cyber-security threats or inadequate levels of cyber-insurance or risks not covered by cyber- insurance; (9) risks associated with our Georgia warehouse including the inability to realize anticipated cost savings and subleasing excess space on favorable terms; (10) risks associated with domestic manufacturing operations, including fluctuations in capacity utilization and the prices and availability of key raw materials, as well as changes in transportation, warehousing and domestic labor costs, availability of skilled labor, and environmental compliance and remediation costs; (11) the risks related to the Sunset Acquisition including integration costs, maintaining Sunset West’s existing customer relationships, debt service costs, interest rate volatility, the use of operating cash flows to service debt to the detriment of other corporate initiatives or strategic opportunities, the loss of key employees from Sunset West, the disruption of ongoing businesses or inconsistencies in standards, controls, procedures and policies across the business which could adversely affect our internal control or information systems and the costs of bringing them into compliance and failure to realize benefits anticipated from the Sunset Acquisition; (12) changes in U.S. and foreign government regulations and in the political, social and economic climates of the countries from which we source our products; (13) risks associated with product defects, including higher than expected costs associated with product quality and safety, regulatory compliance costs (such as the costs associated with the US Consumer Product Safety Commission’s new mandatory furniture tip-over standard, STURDY) related to the sale of consumer products and costs related to defective or non-compliant products, product liability claims and costs to recall defective products and the adverse effects of negative media coverage; (14) disruptions and damage (including those due to weather) affecting our Virginia or Georgia warehouses, our Virginia, North Carolina or California administrative facilities, our High Point, Las Vegas, and Atlanta showrooms or our representative offices or warehouses in Vietnam and China; (15) the risks specifically related to the concentrations of a material part of our sales and accounts receivable in only a few customers, including the loss of several large customers through business consolidations, failures or other reasons, or the loss of significant sales programs with major customers; (16) our inability to collect amounts owed to us or significant delays in collecting such amounts; (17) achieving and managing growth and change, and the risks associated with new business lines, acquisitions, including the selection of suitable acquisition targets, restructurings, strategic alliances and international operations; (18) capital requirements and costs; (19) risks associated with distribution through third-party retailers, such as non-binding dealership arrangements; (20) the cost and difficulty of marketing and selling our products in foreign markets; (21) changes in domestic and international monetary policies and fluctuations in foreign currency exchange rates affecting the price of our imported products and raw materials; (22) the cyclical nature of the furniture industry, which is particularly sensitive to changes in consumer confidence, the amount of consumers’ income available for discretionary purchases, and the availability and terms of consumer credit; (23) price competition in the furniture industry; (24) competition from non-traditional outlets, such as internet and catalog retailers; (25) changes in consumer preferences, including increased demand for lower-priced furniture; and (26) other risks and uncertainties described under Part I, Item 1A. “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended January 29, 2023. Any forward-looking statement that we make speaks only as of the date of that statement, and we undertake no obligation, except as required by law, to update any forward-looking statements whether as a result of new information, future events or otherwise and you should not expect us to do so.

For more information, contact:
Paul A. Huckfeldt, Senior Vice President & Chief Financial Officer, Phone: (276) 666-3949

SHANGHAI, China, June 08, 2023 (GLOBE NEWSWIRE) — Atour Lifestyle Holdings Limited (“Atour” or the “Company”) (NASDAQ: ATAT), a leading hospitality and lifestyle company in China, today announced the pricing of an upsized registered secondary underwritten offering by entities affiliated with Legend Capital (“Legend Capital”) of an aggregate of 5,760,000 American depositary shares (the “ADSs” and such offering, the “Secondary Offering”), each ADS representing three Class A ordinary shares of the Company, at an offering price of US$14.80 per ADS. The Secondary Offering was upsized from 4,800,000 ADSs, as previously disclosed, to 5,760,000 ADSs. The underwriters in the Secondary Offering will have a 30-day option to purchase up to 864,000 additional ADSs from Legend Capital.

The Company will not receive any proceeds from the sale of the ADSs by Legend Capital. The gross proceeds of the Secondary Offering to Legend Capital amounts to US$85.2 million, without deducting underwriting discounts and commissions and offering expenses payable by Legend Capital and assuming the underwriters do not exercise the option to purchase additional ADSs. The closing of the Secondary Offering will be subject to customary closing conditions.

BofA Securities, Inc., and CMB International Capital Limited act as the joint bookrunners for the Secondary Offering.

This Secondary Offering is being made only by means of a written prospectus forming a part of an effective registration statement. The registration statement relating to these securities has been declared effective by the U.S. Securities and Exchange Commission (the “SEC”). A copy of the prospectus related to this Secondary Offering may be obtained by contacting BofA Securities, Inc., One Bryant Park, New York, NY 10036, United States of America, Attention: Prospectus Department, telephone: +1-800-294-1322, email: [email protected]; CMB International Capital Limited, 45F, Champion Tower, 3 Garden Road, Central, Hong Kong, Attention: CMBI ECM, telephone: +852-3761-8990, email: [email protected].

This press release shall not constitute an offer to sell, or a solicitation of an offer to buy, the securities described herein, nor shall there be any offer, solicitation or sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Atour Lifestyle Holdings Limited

Atour Lifestyle Holdings Limited (NASDAQ: ATAT) is a leading hospitality and lifestyle company in China, with a distinct portfolio of lifestyle hotel brands. Atour is the leading upper midscale hotel chain in China and is the first Chinese hotel chain to develop a scenario-based retail business. Atour is committed to bringing innovations to China’s hospitality industry and building new lifestyle brands around hotel offerings.

For more information, please visit https://ir.yaduo.com.

Safe Harbor Statement

This press release contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. In some cases, forward-looking statements can be identified by words or phrases such as “may,” “will,” “expect,” “anticipate,” “target,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to,” or other similar expressions. Forward-looking statements involve inherent risks and uncertainties, and a number of factors could cause actual results to differ materially from those contained in any forward-looking statement. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company does not undertake any duty to update such information, except as required under applicable law.

Investor Relations Contact

Atour Lifestyle Holdings Limited 
Email: [email protected]

Piacente Financial Communications 
Email: [email protected]
Tel: +86-10-6508-0677 

MELBOURNE, Australia, June 08, 2023 (GLOBE NEWSWIRE) — Opthea Limited (NASDAQ:OPT; ASX:OPT), a clinical stage biopharmaceutical company developing novel therapies to treat highly prevalent and progressive retinal diseases, is pleased to announce the appointment of Mr. Anshul Thakral as a Non-Executive Director of the Company’s Board of Directors. Concurrently with this appointment, Mr. Michael Sistenich has resigned as a Non-Executive Director, having served for over 7 years on the Board.

Opthea’s Chairman, Dr. Jeremy Levin, commented “We are immensely grateful to Michael for his contribution to Opthea. Having joined the Board in 2015, Michael has been a valued contributor to Opthea’s growth as the Company transitioned from early-stage clinical research to a dual ASX-Nasdaq listed company running global registrational Phase 3 clinical trials for wet AMD. We offer our sincere thanks and best wishes to Michael and extend a warm welcome to Anshul as a member of the Board.”

Mr. Anshul Thakral is Chief Executive Officer and Board Member of Launch Therapeutics, a clinical development company backed by funds managed by global investment firm Carlyle and its life sciences franchise, Abingworth. Opthea’s Chief Executive Officer and Managing Director Dr. Megan Baldwin said “Opthea entered into a large, non-dilutive structured financing with Carlyle and Abingworth, in collaboration with Launch Therapeutics in August 2022. Anshul’s joining the Board of Opthea further builds our relationship with the Launch Therapeutics team and we look forward to working closely with Anshul as we advance our Phase 3 program.”

Mr. Thakral has worked for over 20 years in the pharmaceutical and biotechnology industry and is an experienced executive, management consultant and entrepreneur. “I am honored to join the Opthea Board and to work alongside great minds in science and healthcare,” said Mr. Thakral. “I feel confident that together, we will continue to find solutions for patients and drive value for shareholders.”

Mr. Thakral was previously Chief Commercial Officer and Executive Vice President of Peri and Post-Approval Services at PPD, and prior to that was Global Head of PPD Biotech. Before PPD, Mr. Thakral ran the global life sciences business unit at Gerson Lehrman Group (GLG) and worked at McKinsey & Company as an associate principal in the health care practice, where he provided strategic advice to global pharmaceutical and biotechnology companies on growth, research and development, business development and commercialization. He currently serves on the boards of TriNetX, Saama Technologies, Orsini Specialty Pharmacy, is an Operating Executive at Carlyle and is a Venture Partner at Abingworth. Mr. Thakral holds a Master’s degree in Biomedical Engineering from Johns Hopkins University and a Masters Business Administration (MBA) from the Wharton School at the University of Pennsylvania.

About Opthea Limited

Opthea (ASX:OPT; Nasdaq:OPT) is a biopharmaceutical company developing novel therapies to address the unmet need in the treatment of highly prevalent and progressive retinal diseases, including wet age-related macular degeneration (wet AMD) and diabetic macular edema (DME). Opthea’s lead product candidate OPT-302 is in pivotal Phase 3 clinical trials and being developed for use in combination with anti-VEGF-A monotherapies to achieve broader inhibition of the VEGF family, with the goal of improving overall efficacy and demonstrating superior vision gains over that which can be achieved by inhibiting VEGF-A alone.

Inherent risks of Investment in Biotechnology Companies

There are a number of inherent risks associated with the development of pharmaceutical products to a marketable stage. The lengthy clinical trial process is designed to assess the safety and efficacy of a drug prior to commercialization and a significant proportion of drugs fail one or both of these criteria. Other risks include uncertainty of patent protection and proprietary rights, whether patent applications and issued patents will offer adequate protection to enable product development, the obtaining of necessary drug regulatory authority approvals and difficulties caused by the rapid advancements in technology. Companies such as Opthea are dependent on the success of their research and development projects and on the ability to attract funding to support these activities. Investment in research and development projects cannot be assessed on the same fundamentals as trading and manufacturing enterprises. Therefore, investment in companies specializing in drug development must be regarded as highly speculative. Opthea strongly recommends that professional investment advice be sought prior to such investments.

Authorized for release to ASX by Megan Baldwin, CEO & Managing Director

Company & Media Enquiries:

Join our email database to receive program updates:
Tel: +61 (0) 3 9826 0399  Email: [email protected]  Web: www.opthea.com

— First Quarter Total Loan Origination Volume Grew 142.9% to RMB19.8 billion —

— First Quarter Net Revenue Grew 119.5% to RMB1,122.2 million —

— First Quarter Net Income Grew 93.4% to RMB279.7 million —

SHANGHAI, China, June 08, 2023 (GLOBE NEWSWIRE) — Jiayin Group Inc. (“Jiayin” or the “Company”) (NASDAQ: JFIN), a leading fintech platform in China, today announced its unaudited financial results for the first quarter ended March 31, 2023.

First Quarter 2023 Operational and Financial Highlights:

• Loan origination volume¹ was RMB19.8 billion (US$2.9 billion), representing an increase of 142.9% from the same period of 2022.
• Average borrowing amount per borrowing was RMB9,913 (US$1,443), representing an increase of 13.5% from the same period of 2022.
• Repeat borrowing rate² was 67.8%, compared with 70.1% in the same period of 2022.
• Net revenue was RMB1,122.2 million (US$163.4 million), representing an increase of 119.5% from the same period of 2022.
• Income from operations was RMB349.3 million (US$50.9 million), representing an increase of 91.4% from the same period of 2022.
• Net income was RMB279.7 million (US$40.7 million), representing an increase of 93.4% from RMB144.6 million in the same period of 2022.

Mr. Yan Dinggui, the Company’s Founder, Director and Chief Executive Officer, commented: “We are thrilled to report a strong start in 2023 with robust financial and operating performance that exceeded both industry trends and our previous forecasts. Our partnership expansions with financial institutions and our tech-driven risk control strategies have been instrumental in achieving this success. We have also made significant strides in refining the structure of our partnership network as well as our borrower base, which contributed to a reduction in average funding costs for the loans we facilitate to better serve our borrowers. Going forward, we will continue investing in high-quality customer acquisition channels, diversifying our customer acquisition strategies in the international marketplace, and enforcing strict compliance with regulatory guidelines. We are confident in our ability to sustain this momentum, maintain our industry-leading position, and deliver even stronger results in the coming quarters.”

First Quarter 2023 Financial Results

Net revenue was RMB1,122.2 million (US$163.4 million), representing an increase of 119.5% from the same period of 2022.

Revenue from loan facilitation services was RMB866.5 million (US$126.2 million), representing an increase of 94.1% from the same period of 2022. The increase was primarily due to increased loan origination volume from the Company’s institutional funding partners.

Other revenue was RMB255.7 million (US$37.2 million), representing an increase of 295.2% from the same period of 2022. The increase was mainly driven by the growth in revenue from individual investor referral services and guarantee income from financial guarantee services.

Origination and servicing expense was RMB274.2 million (US$39.9 million), representing an increase of 193.6% from the same period of 2022, primarily due to increased loan origination volume and expenses related to financial guarantee services.

Allowance for uncollectible receivables, contract assets, loans receivable and others was RMB6.7 million (US$1.0 million), compared with RMB4.0 million in the first quarter of 2022, primarily due to the increased loan volume from overseas markets.

Sales and marketing expense was RMB380.8 million (US$55.4 million), representing an increase of 155.9% from the same period of 2022, primarily due to an increase in borrower acquisition expenses and commission fees for partnership referrals.

General and administrative expense was RMB46.4 million (US$6.8 million), representing an increase of 14.0% from the same period of 2022, primarily due to higher employee compensation and benefit costs.

Research and development expense was RMB64.8 million (US$9.4 million), representing an increase of 55.0% from the same period of 2022, primarily due to higher employee compensation benefit expenses as well as increased professional service fees.

Income from operations was RMB349.3 million (US$50.9 million), representing an increase of 91.4% from the same period of 2022.

Net income was RMB279.7 million (US$40.7 million), representing an increase of 93.4% from RMB144.6 million in the same period of 2022.

Basic and diluted net income per share were both RMB1.31 (US$0.19), compared to RMB0.67 in the first quarter of 2022. Basic and diluted net income per ADS were both RMB5.23 (US$0.76), compared to RMB2.68 in the first quarter of 2022. Each ADS represents four Class A ordinary shares of the Company.

Cash and cash equivalents were RMB340.6 million (US$49.6 million) as of March 31, 2023, compared with RMB291.0 million as of December 31, 2022.

The following table provides the delinquency rates of all outstanding loans on the Company’s platform in Mainland China as of the respective dates indicated.

The following chart and table display the historical cumulative M3+ Delinquency Rate by Vintage for loan products facilitated through the Company’s platform in Mainland China.

Business Outlook

The Company expects its loan facilitation volume for the full year of 2023 to reach approximately RMB70 billion and its loan facilitation volume for the second quarter of 2023 to be in the range of RMB23 billion to RMB24 billion. This forecast reflects the Company’s current and preliminary views on the market and operational conditions, which are subject to change.

Recent Development

Share Repurchase Plan Update

On June 13, 2022, the Company’s board of directors authorized a share repurchase plan under which the Company may repurchase its ordinary shares with an aggregate value of US$10 million during the 12-month period beginning on June 13, 2022. As of March 31, 2023, the Company had repurchased approximately 1.5 million of its American depositary shares for approximately US$3.5 million under this share repurchase plan.

On June 7, 2023, the Company’s board of directors approved to extend the share repurchase plan for a period of 12 months, commencing on June 13, 2023 and ending on June 12, 2024. Pursuant to the extended share repurchase plan, the Company may repurchase its ordinary shares through June 12, 2024 with an aggregate value not exceeding the remaining balance under the share repurchase plan.

Conference Call

The Company will conduct a conference call to discuss its financial results on Thursday, June 8, 2023 at 8:00 AM U.S. Eastern Time (8:00 PM Beijing/Hong Kong Time on the same day).

To join the conference call, all participants must use the following link to complete the online registration process in advance. Upon registering, each participant will receive access details for this event including the dial-in numbers, a PIN number, and an e-mail with detailed instructions to join the conference call.

Participant Online Registration: https://register.vevent.com/register/BI52010b71ef024cbfa99791c0248fb894

A live and archived webcast of the conference call will be available on the Company’s investors relations website at http://ir.jiayin-fintech.com/.

About Jiayin Group Inc.

Jiayin Group Inc. is a leading fintech platform in China committed to facilitating effective, transparent, secure and fast connections between underserved individual borrowers and financial institutions. The origin of the business of the Company can be traced back to 2011. The Company operates a highly secure and open platform with a comprehensive risk management system and a proprietary and effective risk assessment model which employs advanced big data analytics and sophisticated algorithms to accurately assess the risk profiles of potential borrowers. For more information, please visit https://ir.jiayin-fintech.com/.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at a 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 RMB6.8676 to US$1.00, the exchange rate set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System as of March 31, 2023. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

Safe Harbor / Forward-Looking Statements

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the United States 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” and similar statements. The Company may also make written or oral forward-looking statements in its periodic reports to the SEC, 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 the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and the industry. Potential risks and uncertainties include, but are not limited to, those relating to the Company’s ability to retain existing investors and borrowers and attract new investors and borrowers in an effective and cost-efficient way, the Company’s ability to increase the investment volume and loan origination of loans volume facilitated through its marketplace, effectiveness of the Company’s credit assessment model and risk management system, PRC laws and regulations relating to the online individual finance industry in China, general economic conditions in China, and the Company’s ability to meet the standards necessary to maintain listing of its ADSs on the Nasdaq Stock Market or other stock exchange, including its ability to cure any non-compliance with the continued listing criteria of the Nasdaq Stock Market. All information provided in this press release is as of the date hereof, and the Company 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 the Company 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 the Company is included in the Company’s filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F.

For investor and media inquiries, please contact:

Jiayin Group

Mr. Shawn Zhang
Email: [email protected]

or

The Blueshirt Group

Ms. Ally Wang
Email: [email protected]