Huize Reports Third Quarter 2023 Unaudited Financial Results
Nov 17, 2023
SHENZHEN, China, Nov. 17, 2023 (GLOBE NEWSWIRE) -- Huize Holding Limited, (“Huize”, the “Company” or “we”) (NASDAQ: HUIZ), a leading
digital insurance product and service platform for new generation consumers in China, today announced its unaudited financial results for the third
quarter ended September 30, 2023.
Third Quarter 2023 Financial and Operational Highlights

Driving high-quality growth: Gross Written Premiums (“GWP”) facilitated year to date on our platform were RMB4,555.5
million, increased by 31.7% year-over-year. Within GWP, First Year Premiums (“FYP”) accounted for RMB2,203.1 million,
up 54.1% year-over-year. Renewal premiums year to date increased by 16.0% year-over-year to RMB2,352.4 million.
Increases in premiums were driven primarily by our high-quality customer base, sustainably high persistency ratios, andthe diverse array of customized long-term insurance products we distribute.
Focused cost management and improving profitability: Gross profit margin improved by 6.0 percentage points
year-over-year to 35.3% driven by improved customer acquisition efficiency. Operating expense-to-revenue ratio continued
to improve, decreasing by 3.9 percentage points year-over-year to 29.0%. Net profit in the third quarter of 2023 was
RMB20.2 million (US$2.8 million) and non-GAAP net profit was RMB18.5 million, marking the fourth consecutive quarter of
profitability.
Cumulative number of insurance clients served increased to approximately 9.1 million as of September 30, 2023. We
cooperate with 121 insurer partners, including 75 life & health insurance companies and 46 property & casualty insurancecompanies, as of September 30, 2023.
As of September 30, 2023, cash and cash equivalents were RMB258.4 million (US$35.4 million).
Mr. Cunjun Ma, Founder and CEO of Huize, commented, “We are pleased to report our fourth consecutive quarter of profitability, with net profit of
RMB20.2 million and non-GAAP net profit of RMB18.5 million. This solid performance is a testament to the progress we have made in acquiringhigh-quality customers, rolling out a diverse array of cost-effective, customized long-term insurance products, and our omnichannel distribution
capabilities integrating online and offline channels, with a focus on maximizing the lifetime value of our users. Despite the challenging macroeconomic
and industry environment, we once again delivered a sound financial performance for the third quarter reflecting our resilient business performanceamid a turbulent market.”“During the quarter, our strategic focus remained squarely on distributing long-term insurance products, which accounted for 90.9% of GWP. This is
the sixteenth consecutive quarter where this figure has exceeded 90%. FYP for our annuity products tripled during the quarter on a year-over-yearbasis, capitalizing on market demand for retirement savings products. Our high-quality customer base has contributed to persistency ratios of morethan 95% as of the end of August, among the highest in the industry, for the 13th and 25th months of our long-term insurance products. This also led toa 25.2% sequential increase in renewal premiums during the quarter.”“In the ‘To-A’ segment, we continued to empower insurance agents with innovative technologies. In the third quarter, FYP facilitated by the ‘To-A’business reached RMB89.7 million, showing a 37.5% growth year-over-year. For the ‘To-C’ segment, we remained committed to our ‘customer-centric’approach and continued to strengthen user engagement and enhance upselling capabilities. As a result, 38.4% of our long-term insurance products
customers were repeat purchases from existing customers, increasing 4.7 percentage points year-over-year. Moving forward, we will leverage our
deep customer insights to launch a wider range of innovative customized products to meet the growing demand for healthcare, accident, andretirement insurance products in addition to financial planning and wealth inheritance. We will also further optimize our O2O integration to empower
our agents to drive sustainable, high-quality growth and create long-term sustainable shareholder value.”
Third Quarter 2023 Financial Results
GWP and operating revenue
GWP facilitated on our platform was RMB1,245.1 million (US$170.7 million) in the third quarter of 2023, maintaining levels similar to RMB1,249.0
million in the same period of 2022. Within GWP, FYP accounted for RMB644.5 million (or 51.8% of total GWP), a decrease of 5.9% year-over-year.
Renewal premiums accounted for RMB600.6 million (or 48.2% of total GWP), an increase of 6.5% year-over-year.
Operating revenue was RMB292.4 million (US$40.1 million) in the third quarter of 2023, a decrease of 16.9% from RMB351.8 million in the same
period of 2022, primarily due to the decrease in FYP facilitated on our platform.
Operating costs
Operating costs were RMB189.3 million (US$25.9 million) in the third quarter of 2023, a decrease of 23.9% from RMB248.7 million in the same periodof 2022. Operating costs decreased at a faster pace than operating revenue, primarily due to a reduction in channel expenses and an increase in
upselling activities.

Operating expenses
Selling expenses were RMB49.1 million (US$6.7 million) in the third quarter of 2023, a decrease of 12.9% from RMB56.4 million in the same period of2022, primarily due to a decrease in salaries and employment benefits.
General and administrative expenses were RMB21.5 million (US$2.9 million) in the third quarter of 2023, a decrease of 50.2% from RMB43.1 million in
the same period of 2022, mainly due to a reduction in depreciation and amortization expenses and rental and utilities expenses.
Research and development expenses were RMB14.3 million (US$2.0 million) in the third quarter of 2023, a decrease of 12.6% from RMB16.4 million
in the same period of 2022, primarily due to a decrease in employee costs.
Net profit and Non-GAAP net profit for the period
Net profit in the third quarter of 2023 was RMB20.2 million (US$2.8 million), compared with a net loss of RMB10.5 million in the same period of 2022.
Non-GAAP net profit was RMB18.5 million (US$2.5 million) in the third quarter of 2023, compared with a non-GAAP net loss of RMB9.8 million in thesame period of 2022.
Cash and cash equivalents
As of September 30, 2023, the combined balance of the Company’s cash and cash equivalents amounted to RMB258.4 million (US$35.4 million),compared to RMB277.2 million as of December 31, 2022.
Share Repurchase Program
Year to date as of September 30, 2023, the Company had purchased an aggregate of 1,363,148 ADSs for a total amount of approximately US$1.7
million under its share repurchase program.
Conference Call
The Company’s management team will hold an earnings conference call at 7:00 A.M. Eastern Time on Friday, November 17, 2023 (8:00
P.M. Beijing/Hong Kong Time on Friday, November 17, 2023). Details for the conference call are as follows:
Event Title:
Registration Link:

Huize Holding Limited’s Third Quarter 2023 Earnings Conference Call
https://s1.c-conf.com/diamondpass/10034925-lfd3vp.html

All participants must use the link provided above to complete the online registration process in advance of the conference call. Upon registration, eachparticipant will receive a confirmation email containing dial-in numbers, a passcode, and a unique access PIN, which will be used to join theconference call.
Additionally, a live and archived webcast of the conference call will also be available on the Company’s investor relations website at http://ir.huize.com.
About Huize Holding Limited
Huize Holding Limited is a leading digital insurance product and service platform for new generation consumers in China. Targeting the younger
generation, Huize is dedicated to serving its insurance clients for their life-long insurance needs. Leveraging its online platform, Huize offers a wide
variety of insurance products with a focus on long-term life and health insurance products and empowers its insurer partners to reach a large
fragmented client base in the insurance retail market efficiently and enhance their insurance sales. Huize provides insurance clients with digitalized
insurance experience and services, including suitable product recommendations, consulting service, intelligent underwriting, and assistance in claim
application and settlement, which significantly improve transaction experience.
For more information, please visit http://ir.huize.com.
Use of Non-GAAP Financial Measure Statement
In evaluating our business, we consider and use non-GAAP net profit/(loss) attributable to common shareholders as a supplemental measure toreview and assess our operating performance. The presentation of the non-GAAP financial measure is not intended to be considered in isolation or asa substitute for the financial information prepared and presented in accordance with U.S. GAAP. We define non-GAAP net profit/(loss) attributable tocommon shareholders as net profit/(loss) attributable to common shareholders excluding share-based compensation expenses and interest on
convertible bond. Such adjustments have no impact on income tax because either the non-GAAP adjustments were recorded at entities located in tax
free jurisdictions, such as the Cayman Islands or because the non-GAAP adjustments were recorded at operating entities located in the PRC for which
the non-GAAP adjustments were not deductible for tax purposes.
We present the non-GAAP financial measure because it is used by our management to evaluate our operating performance and formulate businessplans. Non-GAAP net profit/(loss) attributable to common shareholders enables our management to assess our operating results without considering
the impact of share-based compensation expenses and the interest on convertible bond. We also believe that the use of this non-GAAP financial
measure facilitates investors’ assessment of our operating performance.
This non-GAAP financial measure is not defined under U.S. GAAP and is not presented in accordance with U.S. GAAP. The non-GAAP financial
measure has limitations as an analytical tool. One of the key limitations of using adjusted net profit/(loss) attributable to common shareholders is that it
does not reflect all items of income and expense that affect our operations. Further, the non-GAAP financial measure may differ from the non-GAAP
financial information used by other companies, including peer companies, and therefore their comparability may be limited.
The non-GAAP financial measure should not be considered in isolation or construed as an alternative to net profit/(loss) attributable to commonshareholders or any other measure of performance or as an indicator of our operating performance. Investors are encouraged to review the historical
non-GAAP financial measure in light of the most directly comparable GAAP measure, as shown below. The non-GAAP financial measure presented
here may not be comparable to similarly titled measure presented by other companies. Other companies may calculate similarly titled measuresdifferently, limiting the usefulness of such measures when analyzing our data comparatively. We encourage investors and others to review ourfinancial information in its entirety and not rely on a single financial measure.
Exchange Rate Information
This announcement contains translations of certain RMB amounts into U.S. dollars at a specified rate solely for the convenience of the reader. Unlessotherwise noted, all translations from RMB to U.S. dollars and from U.S. dollars to RMB are made at a rate of RMB7.2960 to US$1.00, the exchange
rate on September 29, 2023, set forth in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that theRMB or U.S. dollars amounts referred could be converted into U.S. dollars or RMB, as the case may be, at any particular rate or at all.
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. Statements that are not historical facts, including statements about Huize’s beliefs and expectations, are forwardlooking statements. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,”“plans,” “believes,” “estimates,” “confident” and similar statements. Among other things, business outlook and quotations from management in thisannouncement, contain forward-looking statements. Huize may also make written or oral forward-looking statements in its periodic reports to the U.S.
Securities and Exchange Commission (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. Forward-looking statements involve inherent risks and uncertainties. A numberof factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to thefollowing: Huize’s goal and strategies; Huize’s expansion plans; Huize’s future business development, financial condition and results of operations;
Huize’s expectation regarding the demand for, and market acceptance of, its online insurance products; Huize’s expectations regarding its relationshipwith insurer partners and insurance clients and other parties it collaborates with; general economic and business conditions; and assumptions
underlying or related to any of the foregoing.
Further information regarding these and other risks is included in Huize’s filings with the SEC. All information provided in this press release is as of thedate of this press release, and Huize does not undertake any obligation to update any forward-looking statement, except as required under applicablelaw.
For investor and media inquiries, please contact:
Investor Relations
investor@huize.com
Media Relations
mediacenter@huize.com
Christensen
In China
Ms. Crystal Lai
Phone: +852 2117 0861
Email: crystal.lai@christensencomms.com
In U.S.
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: linda.bergkamp@christensencomms.com

Huize Holding Limited
Unaudited Consolidated Balance Sheets(all amounts in thousands, except for share and per share data)
As of December
31

As of September 30

2022
RMB
AssetsCurrent assets
Cash and cash equivalents
Restricted cash
Short-term investments
Contract assets, net of allowance for doubtful accounts
Accounts receivables, net of allowance for impairment
Insurance premium receivables
Amounts due from related parties
Deferred costs
Prepaid expense and other receivables
Total current assets

2023
RMB

USD

277,168
98,91749,888250,667
1,792
489
71,818258,437
72,5239,556
33,704
134,504
2,410
373
4,409
97,53035,422
9,940
1,310
4,620
18,434330
51
604
13,368750,739

613,446

84,079Non-current assets
Contract assets, net of allowance for doubtful accounts
Property, plant and equipment, net
Intangible assets, net
Long-term investments
Operating lease right-of-use assets
Goodwill
Other assets

6,634
38,51853,49877,305
162,180
461
279

9,715
54,79452,85376,742
119,099
461
-

1,332
7,510
7,244
10,51816,324
63-

338,875

313,664

42,991

1,089,614

927,110127,070

150,000
262,266
27,567
4,034
58,251
43,9382,440
10,075495

19,800191,806
39,1283,935
41,19876,0262,440
16,044
1,718

2,714
26,289
5,363
539
5,647
10,420
334
2,199
236

559,066

392,095

53,741

12,491
176,032-

12,048132,796405

1,651
18,201
56

Total non-current liabilities

188,523

145,249

19,908

Total liabilities

747,589

537,344

73,64962
10(15,306)
904,935(17,695)(531,127)62
10(29,802)905,601(9,206)(478,926)

8
1(4,085)
124,123(1,262)(65,642)

340,879
1,146

387,739
2,027

53,143278

342,025

389,766

53,421

1,089,614

927,110127,070

Total non-current assets
Total assets
Liabilities, Mezzanine Equity and Shareholders’ Equity
Current liabilities
Short-term borrowings
Accounts payable
Insurance premium payables
Contract liabilities
Other payables and accrued expenses
Payroll and welfare payable
Income taxes payable
Operating lease liabilities
Amount due to related parties
Total current liabilities
Non-current liabilities
Deferred tax liabilities
Operating lease liabilities
Payroll and welfare payable

Commitments and contingencies
Shareholders’ equity
Class A common sharesClass B common shares
Treasury stock
Additional paid-in capital
Accumulated other comprehensive loss
Accumulated deficits
Total shareholders’ equity attributable to Huize Holding Limited shareholders
Non-controlling interests
Total shareholders’ equity
Total liabilities and shareholders’ equity

Huize Holding Limited
Unaudited Consolidated Statements of Comprehensive Income/(Loss)(all amounts in thousands, except for share and per share data)
For the Three Months Ended September
30,
2022
Operating revenue
Brokerage income
Other income
Total operating revenue
Operating costs and expenses
Cost of revenue
Other cost
Total operating costs

2023

For the Nine Months Ended September 30,
2022

2023

RMB

RMB

USD

RMB

RMB

USD

338,536
13,254

279,110
13,334

38,255
1,828

862,156
37,341

923,029
36,516

126,512
5,005

351,790

292,444

40,083

899,497

959,545

131,517(236,324)(12,369)(184,474)(4,841)(25,284)(664)(547,654)(24,427)(597,062)(15,663)(81,833)(2,147)(248,693)(189,315)(25,948)(572,081)(612,725)(83,980)Selling expenses
General and administrative expenses(56,395)(43,116)(16,363)(49,129)(21,493)(14,305)(6,734)(2,946)(1,961)(189,850)(116,104)(64,020)(162,751)(92,103)(54,620)(22,307)(12,624)(7,486)

Total operating costs and expenses(364,567)(274,242)(37,589)(942,055)(922,199)(126,397)

Operating profit/(loss)(12,777)

18,202

2,494(42,558)

37,346

5,120

Others, net
Profit/(loss) before income tax, and share ofincome/(loss) of equity method investee
Share of income/(loss) of equity method
investee(1,924)
(50)
(435)
4,349

1,490
(101)
(613)
1,299

204
(14)
(84)
178

(4,469)(95)(2,217)
11,071

2,297
(309)
(928)
14,311

315
(42)
(127)
1,961

(10,837)

20,2772,778(38,268)

52,717

7,227

(393)

1,359

186

(3,033)365

50

Net profit/(loss)(11,230)

21,6362,964(41,301)53,082

7,277

(691)

1,467

201

(1,942)881

121(10,539)

20,1692,763(39,359)

52,201

7,156

Net profit/(loss)
Foreign currency translation adjustment, net oftax(11,230)

21,6362,964(41,301)53,082

7,277

7,438

3,237

444

13,151

8,489

1,164

Comprehensive income/(loss)
Comprehensive income/(loss) attributable tonon-controlling interests
Comprehensive income/(loss) attributable toHuize Holding Limited(3,792)

24,873

3,408(28,150)

61,571

8,441

(691)

1,467

201

(1,942)881

121(3,101)

23,406

3,207(26,208)

60,6908,320

995,606,092

1,022,391,802

1,004,018,221

1,004,018,221

0.00(0.04)

0.05

0.01

Research and development expenses

Other income/(expenses)
Interest income/(expenses)
Unrealized exchange loss
Investment loss

Net profit/(loss) attributable to non-controllinginterests
Net profit/(loss) attributable to commonshareholders

Weighted average number of common sharesused in computing net profit per share
Basic and diluted
1,021,183,878 995,606,092
Net profit/(loss) per share attributable tocommon shareholders
Basic and diluted(0.01)
0.02

Huize Holding Limited
Unaudited Reconciliations of GAAP and Non-GAAP Results(all amounts in thousands, except for share and per share data)
For the Three Months Ended
September 30,
2022
Net profit/(loss) attributable to common shareholders
Share-based compensation expenses
Non-GAAP net profit/(loss) attributable to common shareholders

Huize Holding Limited

2023

For the Nine Months Ended
September 30,
2022

2023

RMB
(10,539)
744

RMB
20,169(1,684)

USD
2,763
(231)

RMB
(39,359)
4,447

RMB
52,201
3,709

USD
7,156
508

(9,795)18,485

2,532(34,912)55,9107,664