Lufax shares fall after third-quarter total revenue miss, guidance cut (NYSE:LU)

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Lufax Holding (NYSE:LU) stock decreased by 8.6% in after-hours trading on Wednesday after the Chinese personal financial services platform posted weaker-than-expected third-quarter results and lowered 2022 guidance for loans payable, total revenue and net profit.

3rd quarter total income, i.e equivalent revenue was RMB 13.2B ($1.86B), representing a 17% decline from Q3 2021 and below the $1.99B consensus estimate.

Third-quarter net profit of RMB 1.36B ($190M) fell 67%, as loan and asset value losses, capital costs and other gains/losses increased to RMB 4.34B ($610M), a 97% jump.

New loans fell 28% to RMB 123.8B in Q3 2022.

Third-quarter profit of RMB 1.16 ($0.16), down from RMB 3.31 in the same quarter.

“As our core customer base of small business owners continued to feel the uncontrollable impact of the worsening macroeconomic environment, we faced increased loan impairment losses and loan growth, which weighed on our profitability,” said Chairman and CEO YongSuk Cho.

30+ days on the due date of total loans that the company had granted was 3.6% in September. 30, 2022 vs. 3.1% on June 30. The rate of delinquencies 90+ days after maturity was 2.1% at the end of the third quarter. 1.7% at the end of the second quarter.

Lufax (LU) 2022 guidelines edited: New loans payable are expected to decline by 23%-24% year-on-year to RMB 490B-RMB 495B, down from the previous range of RMB 563B-RMB 590B.

2022 client assets are expected to decline by 1%-10% to RMB 390B-RMB 430B, unchanged from previous guidance.

Total revenue in 2022 is forecast to decline by 6%-8% to RMB 57.0B-RMB 58.0B vs. RMB 60.3B-RMB 61.7B.

Net profit fell 47%-49% to RMB 8.5B-RMB 8.9B, down from previous guidance of RMB 13.0B-RMB 13.4B.

Conference call at 8:00 PM ET.

Earlier, Lufax Holding (LU) GAAP EPS of $0.16 in line, revenue of $1.86B misses $130M

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