Earnings call transcript Q2 2023

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Operator

Ladies and gentlemen, thank you for standing by. And welcome to Huize Holding Limited Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the management prepare remarks, we will have a question-and-answer session. Today's conference call is being recorded and a webcast reply would be available. website under IR Webcast Events Huize’s section. visit at the ir.huize.com, and Please

to over Director. the host now hand I’d like conference Harriet. Harriet Huize’s ahead, today, Hu, to Investor go Relations Please Ms. speaker your

Harriet Hu

Thank you, to conference for call XXXX. and second of our quarter earnings the Hello, operator. everyone welcome

released and IR newswire. the website were and currently earlier financial Our results available are and today operating on our both

with refer which you our Before SEC. applies to discuss Safe that are like we explained our which the continue, as in release, I we more today, Harbor making Please in call earnings this earnings to press be forward-looking also filings would to statement will will release also press measures thoroughly the we non-GAAP statements. note and

operational open CEO, the the Kwok for second for Co-CFO, call an the by of the Co-CFO, provide Ma; Founder today period will highlights on Mr. COO, our start Jiang; questions. the Mr. overview for and Joining XXXX. the us will company’s Mr. call we quarter before are Xiao; Mr. Ma Mr. Cunjun financial the Minghan details providing Mr. and results Tam. then Tam up Li and performance of

now the Ma. will to over Mr. I turn call

Cunjun Ma

Language] [Foreign [Interpreted]

was index and Hello, the industry's confidence is insurance The reached in XXXX recover In the you it XXXX to operating continued XXXX, life of the insurance and same quarter in consumer which the everyone, XX.X quarter in improve. macroeconomy for call. higher to and conditions than thank period XXXX. second of earnings second XXXX conference joining second Huize’s continued quarter industry of the

up another and gross by GWP in comprehensive billion, offline XX% competitive combined reached online In total with our this reported year-over-year. innovation facilitated acquisition set on trend integration RMBX.X positive written product insurance of encouraging products, premiums today. Riding the quarter, on leading customer results platform We age second and long-term a capability. to considerable our market industry and or

revenue RMBXXX XX.X% total year-over-year increased Our to operating by million.

with non-GAAP of We second also consecutive profit achieved million our the in quarter net RMBXX first quarter.

first premiums product platform mix, to Renewal million of second increasing increased RMBXXX the by to quarter. year-over-year year-over-year steadily, is in grow terms to approximately FYP In on continue premiums RMBXXX year by our XX% facilitated XX.X% million. or

the the we savings capture opportunity. in solid omni-channel product our capabilities and amid During quarter, to surge demand products, for offerings leverage the distribution diversified market

XXX% to increased quarter. our our As the such, of quarter marking RMBXXX year-over-year savings XXth year-over-year products consecutive in FYP of products by was about by XX%. GWP RMBXXX FYP XX.X% million. contribution our the also XX.X%, product health second long-term million insurance of increased to long-term long-term

existing and high achieving to customers While reached second At of our stickiness, business and the high lifetime continue customers. with value high the of X.X our remain number end million. young the our quarter, quality clients cumulative growth, insurance potential capitalize we of

During long-term customers the old. quarter, years higher average cities, of from XX.X about an XX% with our tier insurance age were of

average the RMBX,XXX, FYP, while year-over-year. by of products RMBXX,XXX, up size long-term ticket XX.X% insurance In average terms of savings by the approximately was size approximately up was of products ticket year-over-year, XX.X%

than As XXth of and industry month XXth remains accumulated May, in insurance persistence levels the high the ratios for end long-term of more at our XX%.

As partners. we of of XXX the end insurer quarter, with second collaborated have the

insurance Insurance respectively. Xiang An to co-develop Casualty a children, products from our a to for leading Ping customized with develop long-term we insurance insurance and Ping and Chang An An Property An period, medical customized products No.X, users, companies, strategic optimize more and Xin reliable accident product and Insurance striving our continued partnership apart Health our from and Xiao the During customized to offerings product for

Group. Insurance with strengthened We strategic various subsidiaries of Pacific our China cooperation also

Pacific life jointly the insurance Property In the and product China June, In needs launched No.X, is agreement Insurance comprehensive Xin of strategic An Xiao we Area. meet Multi-Currency, Pacific the co-launch This Zu product of of a Kong China which innovative cross-boundary Jin Life agreement Insurance is the in protection Kong, in signed announced market, a to elderly. Hong Greater which Yi a Kong an accident Man targeting partnership services we and increasing customized representing August, milestone with new Hong with a and partnership product a strategic signed insurance insurance of development concept the the retirement promoting whole an the is in Bay Hong customers. in underwriting mainline,

the of present, to we integration approvals, our deepen to insurance qualifications branches in the Tier have the Tianjin In yield provinces River online in a localities, which Beijing, including with continued encouraging region, cities the the sales country (ph) X across ecosystem, major to Yangtze and [COVID] Pearl Delta. coverage and with opened full quarter service XX River offline continues second we Delta At results. regulatory the

with kept have agents intelligent we segment, independent and we technology new In exploring empowered sophisticated tools. the To-A

to reLink period the launched effectively, agents businesses that efficiently During manage a enabling user management up and and proprietary scale them more bases customer system users helps we with ease.

make will from improvements upgrading to further reLink the manual system, lead lead management AI-assisted it we forward, management. to Going

to up facilitated by XXXX. second of FYP In million, facilitated and XXXX, of business sequentially. by in first-half year-over-year, business FYP the In the facilitated amounted the the To-A surpassing RMBXXX the by FYP RMBXXX XXX% the quarter, whole the reached To-A XXX% year million,

In users. and series customer-centric In and operations of needs to celebrations and to to for existing the recognize and targeted our the margin various value targeting including better segment, committed fine-tune product QX client anniversary services, group second healthcare customer customer lifetime new and continue service engagement and our provide users, risk users remain approach and high quarter, parent a we brand value-added segments. and activities, company promotions we various launched

reached XX,XXX efforts XX,XXX successfully more more through these conversions. We achieved than sales than and users

in number with the further insurance cases to of and amount We Huize settlement XX,XXX, claim XXXX, of need. a claims of million. We settlement efficient assisted expanded continue with claim services Xiao offering first-half claim our total the also wider scope RMBXXX users of approximately users the In the by Claim to services. Ma and of range provide professional services assistance reached total

Going insurance forward, companies create intermediaries and demonstrating value the quality win-win customers, sustainable development insurance the for strive driving insurance the and and to high we of dynamic added a of industry.

and continue choose optimized insurance and services. offline between further we to enhance service be For our assistance, engagement and plan, online localized will flexibility user provide customers, users our integration. and sales able product deployments will offline to to and more we to strengthen believe to With online insurance Huize operational process one-stop offerings

to new industry and a operating down for customer insurance insurance new will and and efficiencies continue deliver them For to help build high-quality growth dynamics our cost drivers and we to explore insurance top-notch empowering services. companies, operational bring base improve partners

provide our This over Tam, will concludes my prepared for our Mr. highlights and overview the turn quarter. key remarks he to CFO, I second for financial call Ron of today. will an now the

Ron Tam

Ma Mr. in Harriet, you, zone. evening, good time and Asia everyone, and Thank

will integrated second RMBXXX in by significantly in the outpace the insurance to and to Huize consumer quarter business we our leverages and OXO recovery Sector-wide increased amidst written on year-over-year incomes, XX% industry In confidence further market. billion continue service ecosystem the total during our gross premiums quarter. steadily. At China broader the grew insurance

facilities our quarter. second have billion RMBX.X on platform, in which We the reached a delivered total in XX% GWP year-over-year increase

have our number in bringing end at June the second added to XXX,XXX million quarter. customers We ecosystem of to X.X new the the also the quarter, about total

of on business our During the the us of track quarter. million have RMBXX to of strategies. profit of our upward key non-GAAP third profitability guidance and last in the quarter successful non-GAAP be putting quarter, attributed consecutive the recorded full-year revised we This a net can marking we RMBXX to issued profit that million, execution net meet

continued we GWP with XX% quarter. product on products the straight focus this our strategic First, for from XXth contribution remaining insurance above long-term

customers affluent we platform omnichannel target continued to and product insurance agents our to with distribution Second, technologies. and empower high-quality sophisticated offerings mass

To-C over remained of and quarter, a RMBXXX of with X year-over-year of To-A, representing sequential FYP business over in increase Our X increase second times. line a solid times the million total

for emphasis an operational throughout And improving optimizing of be and the our profitability efficiency by quarter. third, business, to demonstrated operating the leverage this and we continue can place

operating Some as this well by was the an increase this RMBX.X and growth XX.X% XX% or include XX% reaching year-over-year, key billion, quarter's premiums year-over-year FYP, written as Total by gross driven highlights and year-over-year premiums, increased mainly takeaways results following. year premiums. increase from a renewal first in in

life for industry-high Our persistency long-term an at and health ratios insurance remain level.

value enhance XX% and XX% high-quality potential year-over-year relentless size above May, customer are to efforts month increased products reflect at average long-term lifetime ticket metrics profile positive savings by about for and the persistency respectively. insurance RMBXX,XXX. opportunities to tapping to maintained the As These The our our customer upselling of of XXth our XXth and ratios base. our

products, RMBXXX annuities quarter. product position sum RMBXXX quarter, by our health The retirement increased savings second products solidified second in we year-over-year X.X surged assured to million. times in the in increase also million particular our market-leading In by long-term FYP long-term and whole The the a year-over-year long-term life in of savings of product FYP categories. the XX.X% to

patient margins and and Looking the categories that balanced focused FYP increase robust drive channel optimizing growth reached long-term We on operations with in total more the second a customer ahead, we between RMBXXX health evolving remain in improve in anticipate to The which our savings helped needs. year-over-year our in and product efficiencies. a mix marketing the revenue, million operating XX% quarter. to our costs achieve tightening

million, costs in XX% quarter increased margin revenue, rising our RMBXXX to of slower our led healthy compared year. pace and to the XX% a second XX% the result, improvement in operating to in last year-over-year this has a than second a As to quarter at gross

in from In expenses by year. to second period year-over-year, over XX% expense to QX, X.X% of revenue XX% resulting decrease, in falling last improvement the total quarter ratio continued to our the operating same a

were million non-GAAP figures in and approximately net respectively. GAAP quarter and the million profit RMBXX second Our RMBXX

liquidity end million. At demonstrated of as we quarter, cash ample RMBXXX our second of equivalents maintain continue cash balance by combined of the and the to

the the existing June aggregate repurchase have confidence growth our repurchased as quarter, We market continued open the an have prospects. repurchase we continued of under our ADSs, approximately our the long-term shares demonstrating share And X of mandate. prospects to from million and of business end in

OXO as generative integration effort help and and and us and our our in business striving further investments enhancements. position to partners shareholder technologies our and our business ecosystem platform insurance solidify our share service ultimately enhance gain and scenarios product value leveraging strengthening reaching across chain, product insurance our value all technology market agent resilience. the should offerings and of with a service operational top-tier digital This achieve AI sustainable and forward, will efficiencies empowering continued Moving across improve

our the to outlook turning for year. Now

market, results better-than-expected cautiously the industry outlook acquiring in the remain execution we revised expect and China, improving While than macro and from strong optimistic and less cost efficiencies again light to enhancing insurance and customers of in profit a our in outlook net engagement, the achieve currently once not high-quality we the regarding first million half in non-GAAP XXXX. in of RMBXX our upwards customer guidance

open questions. to we the up call now operator. with And will to and you, you, over that, Thank

Operator

and question question-and-answer begin from gentlemen, ahead. we from Coco Gong Instructions] first now the the And [Operator go Ladies session. Please MS.

is open. Your line

Coco Gong

Hi, Language] thanks. [Foreign

So, from hi Stanley. Morgan I'm Coco everyone.

So the various congratulations management the to on results.

next on on have rate of and I first-half interest X. first the tracking interest the hike and the of and questions, because product third basically one in performance quarter August the So potentially product be would rate transition two year

transition sees any, first quarter? and management in half? year, into next management year if of, of base sort forward going So product the That's how this the high because the the be third thinking performance is potential how about we're And question. will first wondering

Huize area? And and what in which that given this Area, Bay Hong opportunity strategy for be, overall, with would what be second the strategy the products launched Kong? the would Greater Life new And CPIC outlook

Ron Tam

Coco. All It's Ron questions, right. Thank you here. for the

July do first regarding indeed the the off In results. shelves So of outlook our effective I question QX, came for products think the to contributing month on have from QX, we the pricing QX have X. X.X% your August

across strong this the industry, think So we of participants from sales quite sales in also say I July. as that can I the in good leading numbers board. And think we have the benefited July are one

structure. two next going the the the respect the industry overall product with an phase to I adaptation is In fourth think think quarter, I over through quarters,

coming think on I lot right are this is market what's will in topical A quarters. now. mainstream be product two next people more discussing of topic highly the opinions mainstream the the that to the

close sum slightly out variable products, to the I [Technical X% X% think increasing of an with will insurance companies lot assured Difficulty] investment product returns. on have traditional type variable a guarantee, already. lower, say. pricing X.X% products the be now We There's the performance. the were guaranteed rolled of should with or returns depending also This X.X% rollout anticipation I but

industry still will declining of now. appeal continue whole because products by to insurance continue But the of to think the for we'll early product to leading category other deposits rate the through have market. China going of we these in products example, environment I is average tell. that wealth continued relative bit a customer think So savings do in managing to savings an bank the right this anticipation a in customers wealth management alternatives too China, well-received attractiveness to and be other adaptation versus the the mainly, It's overall

long-term. well, but would strong in second and month But the in particularly -- the our a be back is So lukewarm savings such July short-term, there market the that demand products, term category slight for on the and product then the perform the quarter of to the of medium then over continue anticipation itself. sales will

So outlook that will be the for perspective. product the

And the Bay Area on for ourselves. the question business Greater plans second

in for the Shanghai, in already, of of industry have center or XX-years the being the and I the heart we have located overall, in benefit think we GBA Shenzhen. geographically been

So of we the region. whole in the sit right GBA center

we respective up innovation activities. new open this And are our customers the achieved is of continued testament Life that Kong to year, for of with potential we we launch provide Kong latest capitalizing a have product our right markets. the if this the on So Hong opportunity good this in products Hong CPIC borders on cross-border now

believe very residents Hong do trends Hong And the this this and product new we for sets And very these market of foray Kong strong from customers long-term address Hong a with have month Kong the Kong market are customers X Region. Bay from Hong the of precisely, We first CPIC the be Hong will the target sales this into China, do in this customers would product. that product of niche new with product retirement believe targeting demand into Kong Greater we Kong. this this for anticipation immigrants also that and prime of

Operator

your and question. Gao for taking go you Thank question from now question next We’ll Mindy next the CLSA. for Please is ahead. the

line Your is open.

Mindy Gao

[Foreign Language]

is trend. Mindy Thank question. from My you about first margin the for is gross CLSA. my question taking This

in see trend So the I wonder how and do second-half the you rationale margin of behind? gross the

is question So about expansion my overseas plan. your second

more So when from is you where you. the us more share can Thank expect with about of color see this you do there overseas revenue contribution expansion a And part to meaningful business? plan?

Ron Tam

you, questions. Two Ron here. It's Thank Mindy.

question first gross our on outlook. The margin

almost quarter that a last throughout have by result, business we points efficiencies gross have think our has improved cost been for as our achieved period I demonstrating same lines. the second And X margin from percentage we year.

margins we at through maintain think gross to strive to the areas. main three level I continued current

the marketing cost have cost. continue on control is spend, customer disciplined acquisition channel One on to very we a our

direct budgets. been stringent have our actually We on acquisition quite

base quite been customer of have repurchases. terms on our harvesting well as focused We in existing

than in We our quarter. from have actually X% achieved repurchase direct this line more To-C rate business

that So spend premium have we new existing new And balance this been that to from to very base. growth able demonstrates our customers. acquisition we carefully customer customer with attract achieve

capital more And also continued to think we I in technology. deploying into have been we efforts. invest the Secondly, AI

on I across many chain. the expecting aspects efficiency of think are to enhancements value business we yield again our

gross So of be the current help maintain I level. measures a strategies margins these at second us would And a that think and measure. will our combination

to your that question. So answer will first the be

overseas the So question on expansion. second

Hong Kong a market Kong international very strategy Hong in expect good opportunity Kong around our or market. MCV XX% Kong year. and Mainland the be in the our This the this overall XXX% billion is in a for Hong terms is have because of extension do is first I business China business HKDXX that expansion. we a to pre-COVID we natural Hong destination or think recovery

a So of local decent mainland Hong China, of well. with to believe in market local Kong able linkage we in recognition who Kong brokerage share our us mainland brand have industry, help achieve insurance the many as that the as equity a was that brand Chinese the a Hong player residents, have we major with the market

top-tier Kong to targeting a business the well in years local we're market for to three market the in and become achieve market broker MCV a So share, business. Kong as Hong the next and also meaningful Hong in the

into of are back Southeast opportunities the on we think in looking Kong investment expansion, Asia. I And Hong potential the

We study are stage. in not currently the feasibility

still and are phase venture potential are across We early opportunities in business Southeast preparation in the a our right for partners potential division. of we in But Asia. rollout joint countries of targeted now in identifying identifying

Operator

Thank We’re taking from from and Instructions] [Operator you question go the Citi. for next your Ma next now question. Michelle the ahead. Please question

is open. line Your

Michelle Ma

Language] [Foreign

The first question thoughts our Tech. about is AI on

for smaller mover a tech's So I issue? mover first thoughts have players, So this should follow the for just industry AI we about sense or like consideration? want think management's should giants of or we those early the tech like advantage on of to

the net second-half about I the leverage. this the And the a with thing leverage. operating for whole the year operating And year. for seeing deterioration and But is we second outlook in are profit promising very think some

cost to pay control? path or continue Language] [Foreign return you. more attention to second-half? expansion we Thank how in the a growth And the revenue we'll to So should about the outlook

Ron Tam

Michelle. take your you, I'll questions. Thank

first the So question on AI.

that see or AI look as a we is second at the really first don't think mover way we I mover.

data in AI any is prerequisite work I the the really in for think vertical, industry platform. respective is have more pertinent for think to the particular the company I key you question

AI efficiency. in the help the to You you technology right improve deploy platform have to data

of pre-sales transaction we regarding we as have this now what have over a conversations, because real-time consultation And system, well that data. is encompasses compliance monitoring to we XX-years you know. have So

a daily data fed be we end between AI have as of conversations into training the to So lot consultants customers and our models.

We also data. have of lot a underwriting

also claims processing have We data.

you Service. As the Claim we understand, Ma have Li Ma Xiao Pay, Xiao

we lot So accumulated this actually a have data. therefore of

us is deployed to helping game-changing AI actually to that all effectively So kind can AI this derive we any, train in-house. so technologies be potentially of, internally, algorithms

the to that the answer be think first to I So question. would your extent

the network data announce next milestone platform. we able we to or market months, because in market XX hold have our to release advantage over And the to proprietary to to think ecosystem, the regard. deploy six the I to hopefully will within we our be this achievements AI, within some

to relation is might although in to So the very, a be in well to creeped second maintain we still, cost it's very China, still challenging, as your economy question extent have that everyone some expenses discipline second it's rigidly to the also, macro in intend mode. were recovery the overall aware, quarter, up but in

We outlook. be I business the natural now, most sustainable resilient remain to think last everything the over needs native proven very with being cautious Huize from to online, continue have time participants where think online that we the respect happening few a do we and to industry be COVID overall an have advantage on and platform. years dynamics as solid and

so, impacted economy the COVID, And when last dampening relating by one confidence to in has to and demand. consumer been year leading over much restrictions negatively or Chinese

profitable quarters. consecutive been fourth quarter challenges have and able to being the emerged year the for ride have last We of three since through cyclical

long-term of manufacturing the an record So the leading market as we and distribution brokerage intermediary as with I very in ourselves, the trajectory terms share between medium insurance separation positive terms overall a the like the player in long-term think a China. this digital of space, to product in increasing in the have of in outlook is

of brokerage high share insurance as to the should have market more percentage go we single-digit of double-digit our mid-double-digits -- seen in economies. past The a up

the So outlook I front. on think overall that will that be

second-half this The year, we of are constructive.

of market would But product think depends day, period. on the Everyone the I it be transitions is think anticipating I some this customers the end there will in demand. at what in the that.

which and better And we product I a and insurance backlog companies. the you. to in be advantage will sort have newer the time products continue in the our still launched products of will new new think insurance the environment. right, in for hold that already when to we customizing a be with And the the and industry, average Thank product of be customer the in savings is QX QX mainstream

Operator

will conference over Thank hand you closing your Harriet to for now remarks. Hu question. for I Ms. the

Harriet Hu

your Thank And like you, joining team. Huize's thank information, And operator. participation One concludes for the you to any out us of further require to please call. for management team, call. today's free to we all feel behalf reach you IR if would thank in today. This the you

Operator

you the concludes Thank conference this for for participating. And today.

You may disconnect. all

Huize Holding Limited (HUIZ) 15 Aug 232023 Q2 Earnings call transcript