Market Newsdesk

CRANBURY, N.J., Nov. 24, 2020 (GLOBE NEWSWIRE) — PMV Pharmaceuticals, Inc. (Nasdaq: PMVP), a precision oncology company pioneering the discovery and development of small molecule, tumor-agnostic therapies targeting p53 mutants, today announced that David H. Mack, Ph.D., President and Chief Executive Officer, will present on Wednesday, December 2, 2020 at the Evercore ISI 3^rd Annual HealthCONx Conference. The presentation will also be available on PMV’s web site. Details on the presentation can be found below.

Evercore ISI 3^rd Annual HealthCONx Conference

Date:	Wednesday, December 2, 2020
Time:	1:00 PM ET
Webcast:	https://wsw.com/webcast/evercore11/pmvp/2394615

About
PMV Pharma

PMV Pharma is a precision oncology company pioneering the discovery and development of small molecule, tumor-agnostic therapies targeting p53 mutants. p53 is mutated in approximately half of all cancer. The field of p53 biology was established by our co-founder Dr. Arnold Levine when he discovered the p53 protein in 1979. Bringing together leaders in the field to utilize over four decades of p53 biology, PMV Pharma combines unique biological understanding with pharmaceutical development focus. PMV Pharma is headquartered in Cranbury, New Jersey. For more information, please visit www.pmvpharma.com.

Contacts

For Investors:
Winston Kung
Chief Financial Officer
[email protected]

For Media:
Mariann Caprino
[email protected]
(917) 242-1087

 

NEW YORK, Nov. 24, 2020 (GLOBE NEWSWIRE) — Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, reminds investors that class actions have been commenced on behalf of stockholders of Reata Pharmaceuticals, Inc. (NASDAQ: RETA), Evolus, Inc. (NASDAQ: EOLS), Las Vegas Sands Corporation (NYSE: LVS), and Innate Pharma S.A. (NASDAQ: IPHA). Stockholders have until the deadlines below to petition the court to serve as lead plaintiff. Additional information about each case can be found at the link provided.

Reata Pharmaceuticals, Inc. (NASDAQ: RETA)

Class Period: October 15, 2019 to August 7, 2020

Lead Plaintiff Deadline: December 14, 2020

Reata is a clinical stage biopharmaceutical company that develops novel therapeutics for patients with serious or life-threatening diseases by targeting molecular pathways that regulate cellular metabolism and inflammation.

Among Reata’s drug candidates under development is omaveloxolone, which is in Phase 2 clinical development to treat Friedreich’s ataxia (“FA”).  Following the announcement of positive data from the MOXIe Part 2 study of omaveloxolone for FA in October 2019, the Company represented that it would seek submission for marketing approval of omaveloxolone for the treatment of FA in the U.S. with the U.S. Food and Drug Administration (“FDA”).

On August 10, 2020, Reata issued a press release announcing its second quarter 2020 financial results, wherein it disclosed that the FDA is “not convinced that the MOXIe Part 2 results” of the Company’s study assessing omaveloxolone for the treatment of FA “will support a single study approval without additional evidence that lends persuasiveness to the results,” and that, “[i]n preliminary comments for [a] meeting, the FDA stated that [Defendants] will need to conduct a second pivotal trial that confirms the mFARS [modified Friedreich’s Ataxia Rating Scale] results of the MOXIe Part 2 study with a similar magnitude of effect.”

On this news, Reata’s stock price fell $51.79 per share, or 33.16%, to close at $104.41 per share on August 10, 2020.

The Complaint, filed on October 15, 2020, alleges that throughout the Class Period defendants made materially false and misleading statements regarding the Company’s business.  Specifically, defendants made false and/or misleading statements and/or failed to disclose that:  (i) the MOXIe Part 2 study results were insufficient to support a single study marketing approval of omaveloxolone for the treatment of FA in the U.S. without additional evidence; (ii) as a result, it was foreseeable that the FDA would not accept marketing approval of omaveloxolone for the treatment of FA in the U.S. based on the MOXIe Part 2 study results; and (iii) as a result, the Company’s public statements were materially false and misleading at all relevant times.

For more information on the Reata class action go to: https://bespc.com/cases/REATA

Evolus
, Inc. (NASDAQ: EOLS)

Class Period: February 1, 2019 to July 6, 2020

Lead Plaintiff Deadline: December 15, 2020

Beginning in February 2019, Evolus embarked on a public campaign to hype the market right before the commercial launch of its sole leading product Jeuveau™. To secure an aggressive growth and an rapid influx of revenue, Evolus disseminated dozens of public statements in which they promoted Jeuveau™ as a proprietary formulation of the botulinum toxic type A complex, purportedly developed by Korean bioengineering company Daewoong through years of clinical research and millions of dollars’ worth of investment in research and development. Among other things, Evolus promised investors that it would attain the number two U.S. market position within 24 months of launch.

The investing public learned the real truth about Jeuveau™ on July 6, 2020 when the U.S. International Trade Commission (“ITC”) issued its Initial Final Determination in a case brought by Allergan and Medytox against Evolus, alleging that Evolus stole certain trade secrets to develop Jeuveau™. Coming as a great surprise to the unsuspecting investors, the ITC Judge found that Evolus misappropriated the botulinum toxin strain as well as the manufacturing processes that led to its development and manufacture. To make things even more catastrophic, the ITC Judge recommended a ten-year long ban on Evolus’ ability to import Jeuveau™ into the United States and a ten-year long cease and desist order preventing Evolus from selling Jeuveau™ in the United States.

On this news Evolus’s share price declined sharply, falling 37% over the course of two trading days, to close at $3.35 on July 8, 2020. Following the news of the ITC’s Initial Final Determination and the subsequent price drop of Evolus’s common shares, several securities analysts downgraded Evolus’s rating and significantly lowered the Company’s price target.

The complaint, filed on October 16, 2020, alleges that throughout the Class period defendants made materially false and misleading statements, and failed to disclose material adverse facts about the Company’s business, operational, and compliance policies. Specifically, defendants made false and/or misleading statements and failed to disclose to investors that: (i) the real source of botulinum toxin bacterial strain as well as the manufacturing processes used to develop Jeuveau™ originated with and were misappropriated from Medytox; (ii) sufficient evidentiary support existed for the allegations that Evolus misappropriated certain trade secrets relating to the botulin toxin strain and the manufacturing processes for the development of Jeuveau™; (iii) as a result, Evolus faced a real threat of regulatory and/or court action, prohibiting the import, marketing, and sale of Jeuveau™; which in turn (iv) seriously threatened Evolus’ ability to commercialize Jeuveau™ in the United States and generate revenue; and (v) any revenues generated from the sale of Jeuveau™ were based on Evolus’ unlawful activities, including the misappropriation of trade secrets and secret manufacturing processes belonging to Allergan and Medytox.

For more information on the Evolus class action go to: https://bespc.com/cases/EOLS

Las Vegas Sands Corporation (NYSE: LVS)

Class Period: February 27, 2016 to September 15, 2020

Lead Plaintiff Deadline: December 21, 2020

Las Vegas Sands was founded in 1988 and is based in Las Vegas, Nevada. The Company, together with its subsidiaries, develops, owns, and operates integrated resorts in Asia and the U.S., which offer various amenities.

Las Vegas Sands’ properties include, among others, the Marina Bay Sands resort in Singapore, which operates a casino.

On July 19, 2020, Bloomberg News reported that Las Vegas Sands had settled a lawsuit brought by a former patron, Wang Xi (“Xi”), meeting his demand for a S$9.1 million ($6.5 million) payment. Xi reportedly sued the Marina Bay Sands casino in 2019 to recover S$9.1 million of his funds that the casino allegedly transferred to other patrons from his casino deposit accounts in 2015 without his approval, which triggered a probe into the casino by local authorities. Bloomberg News also reported that the U.S. Department of Justice (“DOJ”) “is also scrutinizing whether anti-money laundering procedures had been breached in the way the Singapore casino handles high rollers.”

On this news, Las Vegas Sands’ stock price fell $1.41 per share, or 2.9%, to close at $47.28 per share on July 20, 2020.

Then, on September 16, 2020, Bloomberg reported that Marina Bay Sands “has hired a law firm to conduct a new investigation into employee transfers of more than $1 billion in gamblers’ money to third parties[.]” The article quoted the Singapore Casino Regulatory Authority (“CRA”) as stating that “there were weaknesses in [Marina Bay Sands’] casino control measures pertaining to fund transfers[.]”

On this news, Las Vegas Sands’ stock price fell $2.18 per share, or 4.2%, to close at $49.67 per share on September 16, 2020.

The complaint, filed on October 22, 2020, alleges that throughout the Class Period defendants made materially false and misleading statements regarding the Company’s business, operational, and compliance policies. Specifically, defendants made false and/or misleading statements and/or failed to disclose that: (i) weaknesses existed in Marina Bay Sands’ casino control measures pertaining to fund transfers; (ii) the Marina Bay Sands’ casino was consequently prone to illicit fund transfers that implicated, among other issues, the transfer of customer funds to unauthorized persons and potential breaches in the Company’s anti-money laundering procedures; (iii) the foregoing foreseeably increased the risk of litigation against the Company, as well as investigation and increased oversight by regulatory authorities; (iv) Las Vegas Sands had inadequate disclosure controls and procedures; (v) consequently, all the foregoing issues were untimely disclosed; and (vi) as a result, the Company’s public statements were materially false and misleading at all relevant times.

For more information on the Las Vegas Sands class action go to: https://bespc.com/cases/LVS

Innate Pharma S.A. (NASDAQ: IPHA)

Class Period: March 10, 2020 to September 8, 2020

Lead Plaintiff Deadline: December 22, 2020

On September 8, 2020, the Company submitted to the SEC a Form 6-K containing a press release summarizing the results of the first half of 2020, ended June 30, 2020 (the “1H2020 Results”). In the 1H2020 Results, defendants abruptly announced a change in the long-touted payment scheme with AstraZeneca.

On this news, Innate’s American Depositary Share (“ADS”) prices dropped $1.62, or over 26.6%, from closing at $6.07 on September 4, 2020, the previous trading day, to open at $4.82 on September 8, 2020, and declined throughout the trading day to close at $4.45.

The complaint, filed on October 23, 2020, alleges that throughout the Class Period defendants made false and/or misleading statements and/or failed to disclose that: (1) Innate touted the results of their various Phase 2 trials as being within expectations; (2) Innate continued to reassure investors that they were eligible for the $100 million payment upon first dosing of Phase 3 trials; (3) Innate failed to timely disclose their renegotiations with AstraZeneca to split the $100 million payment into two $50 million payments, to be partially contingent on performance during the Phase 3 trials; and (4) as a result, defendants’ statements about its business, operations, and prospects, were materially false and misleading and/or lacked a reasonable basis at all relevant times.

For more information on the Innate Pharma class action go to: https://bespc.com/cases/IPHA

About
Bragar
Eagel
& Squire, P.C.:

Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York and California. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.

Contact Information:

Bragar Eagel & Squire, P.C.
Brandon Walker, Esq.
Melissa Fortunato, Esq.
Marion Passmore, Esq.
(212) 355-4648
[email protected]
www.bespc.com

PLANO, Texas, Nov. 24, 2020 (GLOBE NEWSWIRE) — Reata Pharmaceuticals, Inc. (Nasdaq: RETA) (“Reata,” the “Company,” or “we”), a clinical-stage biopharmaceutical company, today announced that the U.S. Food and Drug Administration (“FDA”) completed its internal review of the Baseline-Controlled Study results of omaveloxolone for the treatment of patients with Friedreich’s ataxia (“FA”) and concluded that the results do not strengthen the results of Part 2 of the MOXIe study. The FDA proposed some additional exploratory analyses using patients randomized to placebo during the MOXIe Part 2 study, but stated that the potential for these analyses to strengthen the study results was questionable due to the small number of patients available for analysis. The FDA stated that they remain interested in reviewing the results of the additional exploratory analyses as those may inform the future development program.

The Company plans to submit to the FDA the analyses that they proposed and to request a meeting with the FDA to discuss the development program. In addition, based on the FDA’s conclusion, the Company is considering the next steps for the development program, including whether to conduct a second pivotal study in patients with FA.

“Omaveloxolone improved motor function as measured by the modified Friedreich’s Ataxia Rating Scale in both Part 2 of the MOXIe study and the Baseline-Controlled study. We are grateful to the families, physicians, investigators, and advocates who have supported this program to date,” said Warren Huff, Reata’s Chairman and Chief Executive Officer. “Though we are disappointed in the FDA’s feedback on this program, we will carefully consider the potential paths forward for making omaveloxolone available to patients with FA.”

About Friedreich’s Ataxia

FA is a rare, inherited, life-shortening, debilitating, and degenerative neuromuscular disorder, which is normally diagnosed during adolescence. FA is typically caused by a trinucleotide repeat expansion in the first intron of the frataxin gene, which encodes the mitochondrial protein frataxin. Pathogenic repeat expansions can lead to impaired transcription and reduced frataxin expression, which can lead to mitochondrial iron overload and poor cellular iron regulation, increased sensitivity to oxidative stress, and impaired mitochondrial ATP production. Patients with FA experience initial symptoms in childhood, including progressive loss of coordination, muscle weakness, and fatigue, commonly resulting in motor incapacitation, with patients requiring a wheelchair by their teens or early 20s. FA patients may also experience visual impairment, hearing loss, diabetes, and cardiomyopathy. Based on literature and proprietary research, we believe FA affects approximately 5,000 children and adults in the United States and 22,000 individuals globally. There are currently no approved therapies for the treatment of FA.

About Omaveloxolone

Omaveloxolone is an investigational, oral, once-daily activator of Nrf2, a transcription factor that induces molecular pathways that promote the resolution of inflammation by restoring mitochondrial function, reducing oxidative stress, and inhibiting pro-inflammatory signaling. The FDA has granted Orphan Drug designation to omaveloxolone for the treatment of Friedreich’s ataxia. The European Commission has granted Orphan Drug designation in Europe to omaveloxolone for the treatment of Friedreich’s ataxia.  

About Reata Pharmaceuticals, Inc.

Reata is a clinical-stage biopharmaceutical company that develops novel therapeutics for patients with serious or life-threatening diseases by targeting molecular pathways involved in the regulation of cellular metabolism and inflammation. Reata’s two most advanced clinical candidates, bardoxolone methyl (“bardoxolone”) and omaveloxolone, target the important transcription factor Nrf2 that promotes the resolution of inflammation by restoring mitochondrial function, reducing oxidative stress, and inhibiting pro-inflammatory signaling.   Bardoxolone and omaveloxolone are investigational drugs, and their safety and efficacy have not been established by any agency.

Contact:

Reata Pharmaceuticals, Inc.
(972) 865-2219
http://reatapharma.com

Investor Relations

Vinny Jindal (469) 374-8721

[email protected]

http://reatapharma.com/contact-us/

Forward-Looking Statements

This press release includes certain disclosures that contain “forward-looking statements,” including, without limitation, statements regarding the success, cost and timing of our product development activities and clinical trials, our plans to research, develop and commercialize our product candidates, our plans to submit regulatory filings, and our ability to obtain and retain regulatory approval of our product candidates.
You can identify forward-looking statements because they contain words such as “believes,” “will,” “may,” “aims,” “plans,” “model,” and “expects.”   Forward-looking statements are based on Reata’s current expectations and assumptions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks, and changes in circumstances that may differ materially from those contemplated by the forward-looking statements, which are neither statements of historical fact nor guarantees or assurances of future performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, (i) the timing, costs, conduct, and outcome of our clinical trials and future preclinical studies and clinical trials, including the timing of the initiation and availability of data from such trials; (ii) the timing and likelihood of regulatory filings and approvals for our product candidates; (iii) whether regulatory authorities determine that additional trials or data are necessary in order to obtain approval; (iv) the potential market size and the size of the patient populations for our product candidates, if approved for commercial use, and the market opportunities for our product candidates; and (v) other factors set forth in Reata’s filings with the U.S. Securities and Exchange Commission, including the detailed factors discussed under the caption “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended December 31, 2019. The forward-looking statements speak only as of the date made and, other than as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

NEW YORK, Nov. 24, 2020 (GLOBE NEWSWIRE) — Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, reminds investors that a class action lawsuit has been filed in the United States District Court for the Southern District of New York on behalf of investors that purchased Pintec Technology Holdings Limited (NASDAQ: PT) securities pursuant and/or traceable to the registration statement and prospectus (collectively, the “Registration Statement”) issued in connection with the Company’s October 2018 initial public offering (“IPO”). Investors have until November 30, 2020 to apply to the Court to be appointed as lead plaintiff in the lawsuit.

Click here to participate in the action.

In October 2018, Pintec completed its IPO in which it sold more than 3.7 million American Depositary Shares (“ADSs” or “shares”) at $11.88 per share.

On July 30, 2019, the Company filed its fiscal 2018 annual report, in which it restated previously disclosed financial results. Among other things, the Company reported net income of $315,000 for fiscal year 2018, compared to its prior disclosure of $1.068 million net income. Pintec also disclosed that there were material weaknesses in its internal control over financial reporting related to cash advances outside the normal course of business to Jimu Group, a related party, and to a non-routine loan financing transaction with a third-party entity, Plutux Labs.

On this news, the Company’s share price fell $0.53, or more than 13%, over the next several trading sessions, to close at $3.40 per share on August 5, 2019, thereby injuring investors.

On June 15, 2020, Pintec disclosed that it could not timely file its fiscal 2019 annual report and that it anticipated reporting a significant change in results of operations. Specifically, the Company disclosed that it “erroneously recorded revenue earned from certain technical service fee on a net basis” for fiscal years 2017 and 2018. Moreover, Pintec “announced a net loss of RMB906.5 million in the full year of 2019 due to RMB890.7 million of provision for credit loss in amounts due from a related party, Jimu Group, and RMB200 million of impairment in prepayment for long-term investment.”

By the commencement of the action, Pintec shares were trading as low as $0.92 per share, a nearly 92% decline from the $11.88 per share IPO price.

The complaint, filed September 29, 2020, alleges that the Registration Statement was false and misleading and omitted to state material adverse facts. Specifically, defendants failed to disclose to investors: (1) that the Company erroneously recorded revenue earned from certain technical service fee on a net basis, rather than a gross basis; (2) that there were material weaknesses in Pintec’s internal control over financial reporting related to cash advances outside the normal course of business to Jimu Group, a related party, and to a non-routine loan financing transaction with a third-party entity, Plutux Labs; (3) that, as a result of the foregoing, the Company’s financial results for fiscal 2017 and 2018 had been misstated; and (4) that, as a result of the foregoing, defendants’ positive statements about the Company’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.

If you purchased Pintec securities pursuant and/or traceable to the Registration Statement issued in connection with Pintec’s October 2018 IPO, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker, Melissa Fortunato, or Marion Passmore by email at [email protected], telephone at (212) 355-4648, or by filling out this contact form. There is no cost or obligation to you.

About Bragar Eagel & Squire, P.C.:

Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York and California. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.

Contact Information:

Bragar Eagel & Squire, P.C.
Brandon Walker, Esq.
Melissa Fortunato, Esq.
Marion Passmore, Esq.
(212) 355-4648
[email protected]
www.bespc.com

GUANGZHOU, China, Nov. 24, 2020 (GLOBE NEWSWIRE) — The board of directors of Fanhua Inc. (“Fanhua” or “the Company”) (Nasdaq: FANH), a leading independent financial services provider in China, today announced that its Board of Directors (the “Board”) has declared a quarterly dividend of US$0.0125 per ordinary share, or US$0.25 per ADS for the third quarter of 2020. The dividend is payable on or around Dec 23, 2020 to shareholders of record on Dec 9, 2020.

About Fanhua Inc.

Fanhua Inc. is a leading independent financial services provider. Through our online platforms and offline sales and service network, we offer a wide variety of financial products and services to individuals, including life and property and casualty insurance products. We also provide insurance claims adjusting services, such as damage assessments, surveys, authentications and loss estimations, as well as value-added services, such as emergency vehicle roadside assistance.

Our online platforms include: (1) Lan Zhanggui, an all-in-one platform which allows our agents to access and purchase a wide variety of insurance products, including life insurance, auto insurance, accident insurance, travel insurance and standard health insurance products from multiple insurance companies on their mobile devices; (2) Baowang (www.baoxian.com), an online entry portal for comparing and purchasing health, accident, travel and homeowner insurance products and (3) eHuzhu (www.ehuzhu.com), a non-profit online mutual aid platform in China.

As of September 30, 2020, our distribution and service network are consisted of 764 sales outlets covering 22 provinces and 121 service outlets covering 31 provinces.

For more information about Fanhua Inc., please visit http://ir.fanhuaholdings.com/.

Forward-looking Statements

This press release contains statements of a forward-looking nature. These statements, including the statements relating to the Company’s future financial and operating results, are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as “will,” “expects,” “believes,” “anticipates,” “intends,” “estimates” and similar statements. Among other things, management’s quotations and the Business Outlook section contain forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about Fanhua and the industry. Potential risks and uncertainties include, but are not limited to, those relating to its ability to attract and retain productive agents, especially entrepreneurial agents, its ability to maintain existing and develop new business relationships with insurance companies, its ability to execute its growth strategy, its ability to adapt to the evolving regulatory environment in the Chinese insurance industry, its ability to compete effectively against its competitors, quarterly variations in its operating results caused by factors beyond its control and macroeconomic conditions in China, future development of COVID-19 outbreak and their potential impact on the sales of insurance products. All information provided in this press release is as of the date hereof, and Fanhua 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 Fanhua 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 Fanhua is included in Fanhua’s filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F. 

CONTACT: Investor Relations 
Tel: (8620) 83883191 
Email: [email protected]

San Francisco, California, Nov. 24, 2020 (GLOBE NEWSWIRE) — US Capital Global Securities LLC, an affiliate of US Capital Global, is offering to eligible investors an investment opportunity of up to $10 million in membership units in US Capital Global Cardax Preferred, LLC, a pooled investment vehicle that will invest in convertible preferred stock of Cardax, Inc. (“Cardax”). This offering is being made in reliance upon the exemption from securities registration afforded by Section 4(a)(2) of the Securities Act of 1933, as amended, pursuant to Rule 506(c) of Regulation D promulgated thereunder.

Headquartered in Honolulu, Hawaii, Cardax (OTCQB: CDXI) is a biopharmaceutical company focused primarily on developing pharmaceuticals to safely address chronic inflammatory disease. Cardax also markets ZanthoSyn®, a physician-recommended dietary supplement for health and longevity.

With offices in San Francisco and London, US Capital Global is a full-service private financial group with an established track record in providing corporate finance and asset management. All securities are offered through the group’s registered broker-dealer division, US Capital Global Securities LLC.

David G. Watumull, President and CEO at Cardax, said: “We are very pleased to be collaborating with US Capital Global Securities on this $10 million offering. We believe Cardax is currently at an inflection point in its growth, and this financing is designed to advance our lead pharmaceutical candidate, CDX-101, over the next 12 to 18 months from pre-clinical to clinical development—a significant value creation event in the industry.”

“It is a real pleasure to be serving Cardax as its lead placement agent on this offering,” said Charles Towle, CEO at US Capital Global Securities. “Cardax’s mission is to safely combat chronic inflammation—one of the major drivers of chronic disease, including cardiovascular disease, metabolic disease, liver disease, arthritis, and aging. If you are interested in Cardax, the opportunity to participate in this $10 million investment is now open to eligible investors.”

About Cardax, Inc.

Cardax is a biopharmaceutical company focused primarily on developing pharmaceuticals for diseases driven by inflammation. The company also has a commercial business unit that markets ZanthoSyn®, an astaxanthin dietary supplement for inflammatory health.* CDX-101, the company’s astaxanthin pharmaceutical candidate, is being developed for cardiovascular inflammation and dyslipidemia, with a target initial indication of severe hypertriglyceridemia. CDX-301, the company’s zeaxanthin pharmaceutical candidate, is being developed for macular degeneration. The safety and efficacy of the company’s pharmaceutical candidates have not been directly evaluated in clinical trials or confirmed by the FDA. www.cardaxpharma.com

About US Capital Global

US Capital Global Securities LLC (“USCGS”) is the FINRA-registered broker-dealer division of US Capital Global that acts as placement agent for growth-stage companies, projects, and investment funds. Since 1998, the US Capital Global team has been committed to providing small and lower middle market businesses and investors with sophisticated debt, equity, and investment opportunities usually available only to larger middle market companies and institutional investors, using the latest FinTech and RegTech innovation. US Capital Global entities manage direct investment funds and provide wealth management and capital raise services. USCGS or its affiliates may provide advice to, be compensated by, may have other business relationships with, or may from time to time acquire, hold or sell a position in the securities of, the issuers mentioned herein. Any such offer or solicitation shall be made only pursuant to the confidential private placement memorandum. View USCGS’ Form CRS at www.uscgs.com/crs.html.      202011PR    

To learn more about US Capital Global Securities or this investment opportunity, email Frank Villarreal at [email protected] or call +1 415-350-4092.

* This statement has not been evaluated by the Food and Drug Administration. This product is not intended to diagnose, treat, cure, or prevent any disease.

Attachment

• uscgs-cardax

Vanessa Guajardo
US Capital Global
+1 415 889 1045
[email protected]

GUANGZHOU, China, Nov. 24, 2020 (GLOBE NEWSWIRE) — Fanhua Inc., (Nasdaq: FANH), (the “Company” or “Fanhua”), a leading independent financial services provider in China, today announced its unaudited financial results for the third quarter ended September 30, 2020¹.

Financial Highlights for
the
Third quarter
of 2020:

(In thousands, except per ADS)	201 9Q3 （ RMB ）	20 20Q3 (RMB)	20 20Q3 (US$)	Change %
Total net revenues	823,351	812,003	119,595	(1.4)
Operating income	151,447	73,326	10,800	(51.6)
Non-GAAP operating income2	111,623	72,736	10,713	(34.8)
Net income attributable to the Company’s shareholders	168,332	75,322	11,094	(55.3)
Non-GAAP net income attributable to the Company’s shareholders3	128,508	74,732	11,007	(41.8)
Diluted net income per ADS	3.12	1.40	0.21	(55.1)
Non-GAAP diluted net income per ADS4	2.38	1.39	0.20	(41.6)
Cash, cash equivalents and short- term investments (As of September 30, 2019 and 2020)	1,760,966	1,700,472	250,453	(3.4)

Commenting on the third quarter results, Mr. Chunlin Wang, chairman and chief executive officer said, “In the third quarter of 2020, our life insurance gross written premiums achieved RMB2.4 billion, with a year-on-year increase of 15.5%, outpacing the industry growth rate of 9.2%. During the same period, first year premiums reached RMB582.7 million and annualized premiums equivalent⁵ were RMB333.5 million while renewal premiums exceeded RMB1.8 billion. The decline in new policies written is mainly attributable to the ongoing impact from the pandemic, the industry-wide downward pressure and slower recruitment in new agents, which partially offset the increase in renewal premiums.

“In recent years, we’ve seen a gradual transformation in the Chinese insurance industry, catalyzed by the sweeping impact of digital technology, a trend that has been further accelerated by the pandemic. In order to lead Fanhua into the post Covid-19 era, we have adopted a strategy of ‘a professional sales force, digital capability and open platform’. We believe that this strategy will enable Fanhua to strengthen its position as a market leader in the professional intermediary industry. The Company plans to upgrade its sales organization by selecting and developing high-caliber, productive and professional insurance advisor teams in economically developed cities in China. We also intend to build an integrated digital platform utilizing artificial intelligence, big data and cloud computing, enabling us to optimize the use of data to provide the most appropriate products for existing and potential customers and increase agent productivity. Finally, we will build an open platform to facilitate a closer cooperation with various third parties who can monetize their existing customer resources and to strengthen our value proposition to the market.

“While the immediate future remains challenging for the industry, we anticipate year-on-year growth in the first quarter next year and significant incremental contribution from the strategy to our results in the second half of 2021. We are confident in our ability to retain the Company’s position as a leader in the professional insurance intermediary sector over the long run.”

Financial Results for the
Third quarter
of
20
20

Total net revenues were RMB812.0 million (US$119.6 million) for the third quarter of 2020, representing a decrease of 1.4% from RMB823.4 million for the corresponding period in 2019.

• Net revenues for the
  life
  insurance
  business were RMB652.4 million (US$96.1 million) for the third quarter of 2020, representing a decrease of 6.3% from RMB696.0 million for the corresponding period in 2019. The decrease was mainly due to the 13.6% year-over-year decline in first year commission from RMB502.1 million in the third quarter of 2019 to RMB433.6 million in the third quarter of 2020, offset by 12.8% year-over-year growth in renewal commissions from RMB193.9 million in the third quarter of 2019 to RMB218.8 million in the third quarter of 2020 as a result of the accumulation of renewal business and high persistency ratio. Revenues generated from our life insurance business accounted for 80.3% of our total net revenues in the third quarter of 2020.
• Net revenues for the P&C insurance business were RMB39.2 million (US$5.8 million) for the third quarter of 2020, representing an increase of 20.2% from RMB32.6 million for the corresponding period in 2019. Revenues for the P&C insurance business, mainly derived from commissions generated from Baowang (www.baoxian.com), increased primarily due to a higher proportion of higher-commission insurance products. Revenues generated from the P&C insurance business accounted for 4.8% of our total net revenues in the third quarter of 2020.
• Net revenues for the claims adjusting business were RMB120.4 million (US$17.7 million) for the third quarter of 2020, representing an increase of 27.0% from RMB94.8 million for the corresponding period in 2019. The increase was mainly due to growth in our medical insurance-related claims adjusting business. Revenues generated from the claims adjusting business accounted for 14.9% of our total net revenues in the third quarter of 2020.

Total operating costs and expenses were RMB738.7 million (US$108.8 million) for the third quarter of 2020, representing an increase of 9.9% from RMB671.9 million for the corresponding period in 2019.

• Commission costs were RMB541.4 million (US$79.7 million) for the third quarter of 2020, representing an increase of 2.0% from RMB530.8 million for the corresponding period in 2019.  
  • Costs of the life insurance business were RMB447.6 million (US$65.9 million) for the third quarter of 2020, representing a decrease of 0.3% from RMBB449.0 million for the corresponding period in 2019. The decrease reflects lower first year premiums. Costs incurred by the life insurance business accounted for 82.7% of our total commission costs in the third quarter of 2020.
  • Costs of the P&C insurance business were RMB24.9 million (US$3.7 million) for the third quarter of 2020, representing an increase of 10.2% from RMB22.6 million for the corresponding period in 2019, in line with our increased revenue and favorable product mix. The costs of the P&C insurance business mainly represent commission costs we incurred for operating Baowang (www.baoxian.com). Costs incurred by the P&C insurance business accounted for 4.6% of our total commission costs in the third quarter of 2020.
  • Costs of claims adjusting business were RMB68.9 million (US$10.1 million) for the third quarter of 2020, representing an increase of 16.6% from RMB59.1 million for the corresponding period in 2019, corresponding to the increase in the medical insurance-related claims adjusting business. Costs incurred by the claims adjusting business accounted for 12.7% of our total commission costs in the third quarter of 2020.
• Selling expenses were RMB78.5 million (US$11.6 million) for the third quarter of 2020, representing an increase of 99.7% from RMB39.3 million for the corresponding period in 2019. Excluding the benefit of a fair value adjustment of RMB28.4 million which reflected the lower share-based compensation expenses related to the Company’s 521 Plan in the third quarter of 2019, adjusted selling expenses which excluded share-based compensation expenses in the third quarter of 2020 increased by 16.4% from RMB67.7 million for the corresponding period of 2019 to RMB78.9 million (US$11.6 million) due to increased sales events related to our claims adjusting segment.
• General and administrative expenses were RMB118.9 million (US$17.5 million) for the third quarter of 2020, representing an increase of 16.8% from RMB101.8 million for the corresponding period in 2019. Excluding the benefit of a fair value adjustment of RMB11.4 million which reflected the lower share-based compensation expenses related to the Company’s 521 Plan in the third quarter of 2019, adjusted general and administrative expenses which excluded share-based compensation expenses in the third quarter of 2020 increased by 5.1% from RMB113.2 million in the corresponding period in 2019 to RMB119.0 million (US$17.5 million) due to an increase in operating lease expenses.

As a result of the preceding factors, we had an operating income of RMB73.3 million (US$10.8 million) for the third quarter of 2020, representing a decrease of 51.6% from RMB151.4 million for the corresponding period in 2019.

Non-GAAP operating income
², which excludes share-based compensation expenses, was RMB72.7 million (US$10.7 million) for the third quarter of 2020, representing a decrease of 34.8% from RMB111.6 million for the corresponding period in 2019.

Operating margin was 9.0% for the third quarter of 2020, compared to 18.4% for the corresponding period in 2019.

Non-GAAP operating margin

⁶
was 9.0% for the third quarter of 2020, compared to 13.6% for the corresponding period in 2019.

Investment income was RMB12.9 million (US$1.9 million) for the third quarter of 2020, representing a decrease of 23.2% from RMB16.8 million for the corresponding period in 2019. The investment income in the third quarter of 2020 consisted of yields from short-term investments in financial products. Our investment income fluctuates from quarter to quarter because investment income is recognized when investments matured or disposed.

Interest income was RMB3.2 million (US$0.5 million) for the third quarter of 2020, representing an increase of 433.3% from RMB0.6 million for the corresponding period in 2019.

Income tax expense was RMB21.3 million (US$3.1 million) for the third quarter of 2020, representing a decrease of 29.5% from RMB30.2 million for the corresponding period in 2019. The effective tax rate for the third quarter of 2020 was 22.9% compared with 18.0% for the corresponding period in 2019.

Share of
income
of affiliates was RMB9.3 million (US$1.4 million) for the third quarter of 2020, representing a decrease of 71.5% from RMB32.6 million for the corresponding period in 2019, mainly attributable to the decrease in income from CNFinance Holdings Limited.

Net income was RMB80.8 million (US$11.9 million) for the third quarter of 2020, representing a decrease of 52.5% from RMB170.2 million for the corresponding period in 2019.

Net income attributable to the Company’s shareholders was RMB75.3 million (US$11.1 million) for the third quarter of 2020, representing a decrease of 55.3% from RMB168.3 million for the corresponding period in 2019.

Non-GAAP net income attributable to the Company’s shareholders
³ was RMB74.7 million (US$11.0 million) for the third quarter of 2020, representing a decrease of 41.8% from RMB128.5 million for the corresponding period in 2019.

Net margin was 9.3% for the third quarter of 2020 as compared to 20.4% for the corresponding period in 2019.

Non-GAAP
net
margin

⁷
was 9.2% for the third quarter of 2020, compared to 15.6% for the corresponding period in 2019.

Basic
and diluted
net income per ADS were RMB1.40 (US$0.21) and RMB1.40 (US$0.21) for the third quarter of 2020, respectively, representing decreases of 55.1% and 55.1% from RMB3.12 and RMB3.12 for the corresponding period in 2019.

Non-GAAP basic

⁸

and diluted
net income per ADS4 were RMB1.39 (US$0.20) and RMB1.39 (US$0.20) for the third quarter of 2020, respectively, representing decreases of 41.8% and 41.6% from RMB2.39 and RMB2.38 for the corresponding period in 2019.

As of September 30, 2020, the Company had RMB1,700.5 million (US$250.5 million) in cash, cash equivalents and short-term investments.

Key Operational Metrics for
Fanhua
’
s
Online Initiatives
in
the
Third
Q
uarter
of 2020
:

• Lan
  Zhanggui
  –
  Our
  one-stop insurance service platform
  :
  • The number of active users of
    Lan
    Zhanggui
    
    ⁹
    was 45,635 in the third quarter of 2020, as compared to 50,248 in the corresponding period of 2019. The number of active users of Lan Zhanggui who have sold at least one life insurance policy was 27,908 in the third quarter of 2020, as compared to 42,051 in the corresponding period of 2019;
  • I
    nsurance premiums generated through
    Lan
    Zhanggui were RMB693.2 million (US$102.1 million) in the third quarter of 2020, among which life insurance premiums was RMB552.3 million (US$81.3 million) and non-life insurance premiums were RMB140.9 million (US$20.8 million), respectively, as compared to RMB684.4 million total insurance premiums generated through Lan Zhanggui which included RMB665.8 million life insurance premiums and RMB18.6 million non-life insurance premiums in the corresponding period of 2019.
• eHuzhu
  – Our online mutual aid platform:
  • The number of
    paying
    members was 3.0 million as of September 30, 2020, as compared to 3.4 million as of September 30, 2019.
• Baowang (www.baoxian.com) – Our direct-to-consumer (“DTC”)online insurance platform for Accident & Short Term Health insurance(“A&H”), travel and homeowner insurance:
  • The number of active customer accounts¹⁰ was 93,374 in the third quarter of 2020, representing a decrease of 41.0% from 158,275 in the corresponding period of 2019;
  • Insurance premiums generated on Baoxian.com was RMB81.7 million (US$12.0 million) in the third quarter of 2020 as compared to RMB86.6 million in the corresponding period of 2019.

Recent Development
s

• Given the impact of Covid-19 and the recent evolving dynamics of the insurance industry, the Company estimated that it is not probable that the participants can achieve the performance condition of the 521 Plan for 2020. Accordingly, the Company plans to terminate the 521 Plan. This will include returning the subscribed shares by the Participants to the Company, refunding the share rights deposits amounting RMB260.3 million received by the Company back to the Participants, and terminating the Participants’ obligation to repay the Company the non-recourse loan principal and interest by the end of 2020. The returned shares will be cancelled subsequently.
• On October 16, 2020, Fanhua Insurance Sales Service Group Company Limited was awarded the “Value Star of Insurance Intermediary Brand of the Year 2020” by Insurance Today, a prestigious online insurance trade media. The award was selected by a panel of experts and online and offline media, aiming at researching the industry from various dimensions of insurance companies, insurance intermediaries, insurance products and services and third-party technology support.
• As of September 30, 2020, Fanhua had 424,510 sales agents and 1,615 professional claims adjusters, compared with 658,145 sales agents and 1,319 claims adjusters as of September 30, 2019. The number of performing agents¹¹ in the third quarter of 2020 was 95,101, including approximately 28,135 selling life insurance products, , compared with 111,486 performing agents as of September 30, 2019, including 43,470 selling life insurance products. As of September 30, 2020, Fanhua’s distribution network consisted of 764 sales outlets in 22 provinces and 121 services outlets in 31 provinces, compared with 755 sales outlets in 22 provinces and 144 service outlets in 31 provinces as of September 30, 2019.

Busine
ss Outlook

Fanhua expects its operating income to be no less than RMB50 million for the fourth quarter of 2020. This forecast is based on the current market conditions and reflects Fanhua’s preliminary estimate, which is subject to change caused by various uncertainties, including those related to the COVID-19 pandemic.

Conference Call

The Company will host a conference call to discuss its third quarter 2020 financial results as per the following details.

Time: 8:00 PM Eastern Daylight Time on November 24, 2020

or 9:00 AM Beijing/Hong Kong Time on November 25, 2020

Due to the outbreak of COVID-19, operator-assisted conference calls are not available at the moment. Please pre-register online in advance to join the conference call by navigating to the link provided below and dial-in 10 minutes before the call is scheduled to begin. Conference call details will be provided upon registration.

Conference Call Preregistration:
http://apac.directeventreg.com/registration/event/3674096

Additionally, a live and archived webcast of the conference call will be available at Fanhua’s investor relations website https://edge.media-server.com/mmc/p/2enqmuag

About Fanhua Inc.

Fanhua Inc. is a leading independent financial services provider. Through our online platforms and offline sales and service network, we offer a wide variety of financial products and services to individuals, including life and property and casualty insurance products. We also provide insurance claims adjusting services, such as damage assessments, surveys, authentications and loss estimations, as well as value-added services, such as emergency vehicle roadside assistance.

Our online platforms include: (1) Lan Zhanggui, an all-in-one platform which allows our agents to access and purchase a wide variety of insurance products, including life insurance, auto insurance, accident insurance, travel insurance and standard health insurance products from multiple insurance companies on their mobile devices; (2) Baowang (www.baoxian.com), an online entry portal for comparing and purchasing short term health, accident, travel and homeowner insurance products and (3) eHuzhu (www.ehuzhu.com), a non-profit online mutual aid platform in China.

As of September 30, 2020, our distribution and service network is consisted of 764 sales outlets in 22 provinces and 121 services outlets in 31 provinces.

For more information about Fanhua Inc., please visit http://ir.fanhuaholdings.com/.

Forward-looking Statements

This press release contains statements of a forward-looking nature. These statements, including the statements relating to the Company’s future financial and operating results, are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as “will,” “expects,” “believes,” “anticipates,” “intends,” “estimates” and similar statements. Among other things, management’s quotations and the Business Outlook section contain forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about Fanhua and the industry. Potential risks and uncertainties include, but are not limited to, those relating to its ability to attract and retain productive agents, especially entrepreneurial agents, its ability to maintain existing and develop new business relationships with insurance companies, its ability to execute its growth strategy, its ability to adapt to the evolving regulatory environment in the Chinese insurance industry, its ability to compete effectively against its competitors, quarterly variations in its operating results caused by factors beyond its control and macroeconomic conditions in China, future development of COVID-19 outbreak and their potential impact on the sales of insurance products. All information provided in this press release is as of the date hereof, and Fanhua 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 Fanhua 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 Fanhua is included in Fanhua’s filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F.

About Non-
GAAP Financial Measures

In addition to the Company’s consolidated financial results under GAAP, the Company also provides adjusted selling expenses, adjusted general and administrative expenses, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income attributable to the Company’s shareholders, non-GAAP net margin and non-GAAP basic and diluted net income per ADS, all of which are non-GAAP financial measures. Adjusted selling expenses are defined as selling expense before share-based compensation expenses related to shares owned by sales team leaders under the Company’s 521 Plan. Adjusted general and administrative expenses are defined as general and administrative expense before share-based compensation expenses related to shares owned by employees under the Company’s 521 Plan. Non-GAAP operating income is defined as operating income before share-based compensation expenses associated with the Company’s 521 Plan. Non-GAAP operating margin is defined as Non-GAAP operating income as a percentage of net revenue. Non-GAAP net income attributable to the Company’s shareholders is defined as net income attributable to the Company’s shareholders before share-based compensation expenses associated with the Company’s 521 Plan. Non-GAAP net margin is a non-GAAP measure that is defined as Non-GAAP net income attributable to the Company’s shareholders as a percentage of net revenue. Non-GAAP basic net income per ADS is a non-GAAP measure and is defined as net income attributable to the Company’s shareholders before share-based compensation expenses associated with the Company’s 521 Plan divided by total weighted average number of ADS outstanding of the Company during the period. Non-GAAP diluted net income per ADS is a non-GAAP measure and is defined as net income attributable to the Company’s shareholders before share-based compensation expenses associated with the Company’s 521 Plan divided by total weighted average number of diluted ADS outstanding of the Company during the period. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing the Company’s performance and when planning and forecasting future periods. One limitation of using these non-GAAP financial measures is that such measures exclude items that were significant in the third quarter of 2019.

In light of these limitations, the presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. We encourage investors and other interested persons to review our financial information in its entirety and not rely on a single financial measure. For more information on these non-GAAP financial measures, please see the tables captioned “Reconciliations of GAAP Financial Measures to Non-GAAP Financial Measures” set forth at the end of this release.

FANHUA INC. Unaudited Condensed Consolidated Balance Sheets (In thousands)
	As of December 31 ,		As of September 30 ,		As of September 30 ,
	2019		2020 12		2020
	RMB		RMB		US$
ASSETS:
Current assets:
Cash and cash equivalents	169,653		208,324		30,683
Restricted cash	95,952		94,593		13,932
Short term investments	1,612,351		1,492,148		219,770
Accounts receivable, net	682,171		527,369		77,673
Insurance premium receivables	5,067		530		78
Other receivables	61,570		155,053		22,837
Other current assets	54,987		42,584		6,272
Total current assets	2,681,751		2 , 5 20 , 601		37 1 , 245
Non-current assets:
Restricted bank deposit – non current	—		15,243		2,245
Property, plant, and equipment, net	40,806		36,374		5,357
Goodwill and intangible assets, net	110,191		109,932		16,191
Deferred tax assets	7,327		10,217		1,505
Investment in affiliates	363,414		364,146		53,633
Other non-current assets	46,917		45,567		6,711
Right of use assets	190,437		218,356		32,160
Total non-current assets	759,092		7 99 , 835		11 7 , 802
Total assets	3,440,843		3 , 32 0,43 6		489, 047

Current liabilities:
Accounts payable	382,882			302,605			44,569
Insurance premium payables	7,901			32,454			4,780
Other payables and accrued expenses	220,290			189,931			27,974
Accrued payroll	101,664			90,873			13,385
Income tax payable	155,251			157,211			23,155
Current operating lease liability	79,986			88,933			13,098
Total current liabilities	947 , 974			86 2 , 0 0 7			1 2 6 , 9 61
Non-current liabilities:
Refundable share rights deposits	266,901			260,299			38,338
Other tax liabilities	70,350			67,219			9,900
Deferred tax liabilities	7,898			21,991			3,239
Non-current operating lease liability	103,252			119,140			17,547
Total non-current liabilities	448 , 401			46 8 , 649			69 , 024
Total liabilities	1,396,375			1,330,6 56			195,98 5
Ordinary shares	9,235			9,235			1,360
Treasury stock	(1,146	)		(1,146	)		(169	)
Additional paid-in capital	393			—			—
Statutory reserves	508,739			508,739			74,929
Retained earnings	1,479,494			1,391,705			204,976
Accumulated other comprehensive loss	(65,429	)		(40,262	)		(5,930	)
Total shareholders’ equity	1,931,286			1 , 86 8,271			275, 166
Non-controlling interests	113,182			121,509			17,896
Total equity	2,044,468			1 , 9 89,780			293, 062
Total liabilities and equity	3,440,843			3 , 3 2 0,4 3 6			489, 04 7

FANHUA INC.
Unaudited Condensed Consolidated Statements of Inco me and Compreh e nsive Income (In thousands, except for shares and per share data)
		For the Three Months Ended									For the Nine Months Ended
		September 30 ,									September 30 ,
		201 9			20 20			20 20			201 9			20 20			20 20
		RMB			RMB			US$			RMB			RMB			US$
Net revenues:
Agency		728,524			691,593			101,861			2,439,188			2,107,511			310,403
Life insurance business		695,968			652,370			96,084			2,326,746			2,006,030			295,456
P&C insurance business		32,556			39 , 223			5,777			112,442			101,481			14,947
Claims adjusting		94,827			120,410			17,734			254,236			308,660			45,461
Total net revenues		823,351			812,003			119,595			2,693,424			2 , 416 , 17 1			355,864
Operating costs and expenses:
Agency		(471,668	)		(472,512	)		(69,593	)		(1,639,456	)		(1,452,077	)		(213,867	)
Life insurance Business		(449,020	)		( 447,634	)		( 65,929	)		(1,564,815	)		(1,381,898	)		(203,53 1	)
P&C insurance Business		(22,648	)		( 24,878	)		( 3,664	)		(74,641	)		(70,17 9	)		(10,336	)
Claims adjusting		(59,102	)		(68,851	)		(10,141	)		(150,461	)		(179,917	)		(26,499	)
Total operating costs		(530,770	)		( 541 , 36 3	)		( 79,734	)		(1,789,917	)		( 1,631,994	)		( 240,36 6	)
Selling expenses		(39,309	)		(78,460	)		(11,556	)		(200,988	)		(209,859	)		(30,909	)
General and administrative expenses		(101,825	)		(118,854	)		(17,505	)		(347,286	)		(344,006	)		(50,667	)
Total operating costs and expenses		(671,904	)		( 738,67 7	)		( 108,795	)		(2,338,191	)		( 2,185,8 59	)		( 321,94 2	)
Income from operations		151,447			73 , 326			10,800			355,233			230,31 2			33,92 2
Other income, net:
Investment income		16,761			12,910			1,901			69,684			27,039			3,982
Interest income		620			3,196			471			2,590			11,140			1,641
Others, net		(1,028	)		3,359			494			10,866			28,747			4,234
Income from operations before
income taxes and share income of affiliates		167,800			92,791			13,666			438,373			297,23 8			43,77 9
Income tax expense		(30,241	)		(21,286	)		(3,135	)		(109,969	)		(69,910	)		(10,297	)
Share of income of affiliates		32,596			9,279			1,367			86,839			1,427			210
Net income		170,155			8 0,784			1 1,898			415,243			2 28,755			33, 69 2
Less: net income attributable to noncontrolling interests		1,823			5,462			804			1,634			8,327			1,226
Net income attributable to the
Company’s shareholders		168,332			7 5,322			11 ,094			413,609			22 0,42 8			32, 46 6

FANHUA INC. Unaudited Condensed Consolidated Statements of Income and Comprehensive Income-(Continued) (In thousands, except for shares and per share data)
		For the Three Months Ended									For t he Nine Months Ended
		September 30 ,									September 30 ,
		201 9			20 20			20 20			201 9			20 20			20 20
		RMB			RMB			US$			RMB			RMB			US$
Net income per share:
Basic		0.16			0.07			0.01			0.38			0.21			0.03
Diluted		0.16			0.07			0.01			0.38			0.21			0.03
Net income per ADS:
Basic		3.12			1.40			0.21			7.53			4.11			0.60
Diluted		3.12			1.40			0.21			7.52			4.10			0.60
Shares used in calculating net income per share:
Basic		1,077,381,239			1,073,891,784			1,073,891,784			1,098,906,389			1,073,891,784			1,073,891,784
Diluted		1,077,780,976			1,074,291,392			1,074,291,392			1,099,443,163			1,074,291,409			1,074,291,409
Net income		170,155			8 0 , 784			1 1 , 89 8			415,243			228,755			33,69 2
Other comprehensive income, net
of tax: Foreign currency translation adjustments		2,631			6,302			928			6,021			10,159			1,496
Share of other comprehensive
gain of affiliates		1,147			(1,553	)		(229	)		1,270			(694	)		(102	)
Unrealized net gains on
available-for-sale investments		3,964			3,917			577			3,964			15,702			2,313
Comprehensive income		177,897			89 , 450			13, 174			426,498			2 53,92 2			3 7,39 9
Less: Comprehensive income
attributable to the noncontrolling interests		1,823			5,462			804			1,634			8,327			1,226
Comprehensive income
attributable to the Company ’s shareholders		176,074			8 3 , 988			12 , 370			424,864			2 45,59 5			3 6,17 3

FANHUA INC. Unaudited Condensed Consolidated Statements of Cash Flow (In thousands, except for shares and per share data)
	For the Three Months Ended									For the Nine Months Ended
	September 30 ,									September 30 ,
	201 9			20 20			20 20			201 9			20 20			20 20
	RMB			RMB			US$			RMB			RMB			US$
OPERATING ACTIVITIES
Net income	170,155			80,784			11,898			415,243			228,755			33,69 2
Adjustments to reconcile net
income to net cash generated from operating activities:
Investment income	(11,298	)		(8,030	)		(1,183	)		(56,655	)		(13,132	)		(1,934	)
Share of income of affiliates	(32,596	)		(9,279	)		(1,367	)		(86,839	)		(1,427	)		(210	)
Other non-cash adjustments	859			31,153			4,587			97,946			102,090			15,035
Changes in operating assets and liabilities:	993			32,625			4,806			(316,084	)		(14,465	)		(2,128	)
Net cash generated from
operating activitie s	128,113			127,253			18,741			53,611			301,821			44,455
Purchase of short term investments	(2,780,221	)		(2,326,840	)		(342,706	)		(5,948,901	)		(6,934,962	)		(1,021,410	)
Proceeds from disposal of short term investments	2,460,289			1,827,416			269,149			5,962,606			7,078,630			1,042,570
Cash paid for loan receivables to a third party	—			—			—			—			(90,000	)		(13,256	)
Others	1,512			(3,832	)		(564	)		(7,050	)		(9,575	)		(1,410	)
Net cash (used in) generated from
investing activities	(318,420	)		(503,256	)		(74,121	)		6,655			44,093			6,494
Dividends paid	(115,078	)		(91,865	)		(13,530	)		(321,820	)		(300,695	)		(44,288	)
Repurchase of shares from open market	(154,325	)		—			—			(484,016	)		—			—
Others	(3,790	)		—			—			126,982			—			—
Net cash used in financing activities	(273,193	)		(91,865	)		(13,530	)		(678,854	)		(300,695	)		(44,288	)
Net (decrease) increasein cash,
cash equivalents and restricted cash	(463,500	)		(467,868	)		(68,910	)		(618,588	)		45,219			6,661
Cash, cash equivalents and
restricted cash at beginning of period	702,064			786,737			115,874			848,166			265,605			39,119
Effect of exchange rate changes
on cash and cash equivalents	13,469			(709	)		(104	)		22,455			7,336			1,080
Cash, cash equivalents and
restricted cash at end of period	252,033			318,160			46,860			252,033			318,160			46,860

F ANHUA INC. Reconciliations of GAAP Financial Measures to Non-GAAP Financial Measures (In RMB in thousands, except shares and per share data)
	For the Three Months Ended September 30
	20 19								20 20
	GAAP			Share-based compensation expenses		Non-GAAP			GAAP			Share-based compensation expenses		Non-GAAP			Change%
Net revenues	823,351			—		823,351			812,003					812,003			( 1.4	)
Selling expenses	(39,309	)		28,446		(67,755	)		(78,460	)		421		(78,881	)		16.4
General and administrative expenses	(101,825	)		11,378		(113,203	)		(118,854	)		169		(119,023	)		5.1
Income from operations	151,447			39,824		111,623			73,326			590		72,736			( 34.8	)
Operating margin	18.4	%		—		13.6	%		9	%		—		9	%		(33.8	)
Net income attributable to the Company’s shareholders	168,332			39,824		128,508			7 5,322			590		7 4,732			(41.8	)
Net margin	20.4	%		—		15.6	%		9.3	%		—		9.2	%		(41.0	)
Net income per share:
Basic	0.16			—		0.12			0.07			—		0.07			(41.7	)
Diluted	0.16			—		0.12			0.07			—		0.07			(41.7	)
Net income per ADS:
Basic	3.12			—		2.39			1.40			—		1.39			(41.8	)
Diluted	3.12			—		2.38			1.40			—		1.39			(41.6	)
Shares used in calculating net income per share:
Basic	1,077,381,239			—		1,077,381,239			1,073,891,784			—		1,073,891,784			—
Diluted	1,077,780,976			—		1,077,780,976			1,074,291,392			—		1,074,291,392			—

	For the Nine Months Ended September 30
	201 9									20 20
	GAAP			Share-based compensation expenses			Non-GAAP			GAAP			Share-based compensation expenses		Non-GAAP			Change%
Net revenues	2,693,424			—			2,693,424			2,416,171			—		2,416,171			( 10.3	)
Selling expenses	(200,988	)		(2,486	)		(198,502	)		(209,859	)		281		(210,140	)		5.9
General and administrative expenses	(347,286	)		(994	)		(346,292	)		(344,006	)		113		(344,119	)		(0.6	)
Income from operations	355,233			(3,480	)		358,713			230,31 2			39 4		229,918			( 35.9	)
Operating margin	13.2	%		—			13.3	%		9.5	%		—		9.5	%		(28.6	)
Net income attributable to the Company’s shareholders	413,609			(3,480	)		417,089			22 0,428			39 4		220, 03 4			( 47. 2	)
Net margin	15.4	%		—			15.5	%		9.1	%		—		9.1	%		(41.3	)
Net income per share:
Basic	0.38			—			0.38			0.21			—		0.20			(47.4	)
Diluted	0.38			—			0.38			0.21			—		0.20			(47.4	)
Net income per ADS:				—									—
Basic	7.53			—			7.59			4.11			—		4.10			(46.0	)
Diluted	7.52			—			7.59			4.10			—		4.10			(46.0	)
Shares used in calculating net income per share:
Basic	1,098,906,389			—			1,098,906,389			1,073,891,784			—		1,073,891,784			—
Diluted	1,099,443,163			—			1,099,443,163			1,074,291,409			—		1,074,291,409			—

Source:

Fanhua Inc.

_________________________________

¹  This announcement contains currency conversions of certain Renminbi (RMB) amounts into U.S. dollars (US$) at 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 RMB6.7896 to US$1.00, the effective noon buying rate as of September 30, 2020 in The City of New York for cable transfers of RMB as set forth in the H.10 weekly statistical release of the Federal Reserve Board.

²  Non-GAAP operating income is defined as operating income before share-based compensation expenses.

³  Non-GAAP net income attributable to the Company’s shareholders is defined as net income attributable to the Company’s shareholders before share-based compensation expenses.

⁴   Non-GAAP diluted net income per ADS is defined as net income attributable to the Company’s shareholders before share-based compensation expenses divided by total weighted average number of diluted ADS outstanding of the Company during the period.

⁵   Annualized premiums equivalent is a measure used by the Company to compare annual premiums received from life insurance policies with differing tenures by normalizing annual premiums into the equivalent annual premium of a policy with a tenure of 20 years.

⁶   Non-GAAP operating margin is defined as Non-GAAP operating income as a percentage of net revenue.

⁷   Non-GAAP net margin is defined as non-GAAP net income attributable to shareholders as a percentage of net revenue.

⁸   Non-GAAP basic net income per ADS is defined as non-GAAP net income attributable to the Company’s shareholders divided by total weighted average number of ADS outstanding of the Company during the period.

⁹   Active users of Lan Zhanggui included users who sold at least one insurance policy through Lan Zhanggui (through either its mobile application or WeChat public account) during the specific period.

¹⁰ Active customer accounts are defined as customer accounts that made at least one purchase directly through www.baoxian.com, its mobile application, or WeChat public account during the specified period.

¹¹ Performing agents are defined as agents who have sold at least one insurance policy during the specified period.

¹² In September 2016, FASB issued ASU No. 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. This standard requires entities to measure all expected credit losses of financial assets held at a reporting date based on historical experience, current conditions, and reasonable and supportable forecasts in order to record credit losses in a timelier manner. ASU 2016-13 also amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. ASU 2016-13 adds to U.S. GAAP an impairment model (known as the current expected credit loss (CECL) model) that is based on expected losses rather than incurred losses. The Company adopted the ASU No. 2016-13 on a modified-retrospective basis, the cumulative-effect adjustment reduce opening retained earnings balance by approximately RMB7.5 million in the statement of financial position as of January 1, 2020.

For more information, please contact:

Investor Relations
Tel: +86 (20) 8388-3191
Email: [email protected]