Fanhua Inc. (Nasdaq: FANH) (the “Company” or “Fanhua”), a leading
independent technology-driven financial services provider in China,
today announced that its board of directors (the
“
Board”) has authorized the expansion of the
Company’s share repurchase program by an additional US$20 million,
bringing the total authorized amount of share repurchase to US$40
million. The share repurchase program was intended to enhance
shareholder returns and signals the Company's confidence in its
long-term growth prospects.
As of June 30, 2024, approximately 726,616
American Depository Shares had been repurchased at an aggregate
purchase price of approximately US$5.4 million since the inception
of the share repurchase program in December 2022.
Alongside the Company’s expansion of the share
repurchase program, several of Fanhua’s senior executives including
Mr. Yinan Hu, founder and Chief Executive Officer, Mr. Peng Ge,
Chief Financial Officer, and Mr. Ben Lin, Chief Strategy Officer,
and Mr. Allen Lueth, independent director and chairman of the Audit
Committee of the Board, have indicated that they will increase
their personal shareholdings of Fanhua. Over the next 12 months,
they intend to purchase up to US$5 million worth of shares of
Fanhua.
The share repurchases will be made from time to
time in the open market at prevailing market prices and/or in
privately negotiated transactions, depending on market conditions
and in accordance with applicable rules and regulations and the
Company’s insider trading policy. Fanhua plans to fund the
corporate share repurchase program with its available cash reserve
while the senior executives and director will use their personal
funds.
Commenting on the expanded share repurchase
program and management share buyback, Mr. Yinan Hu, founder and
Chief Executive Officer of Fanhua, said, “The Board's authorization
to expand the share repurchase program demonstrates its confidence
in our strategic plan for long-term growth and commitment to
shareholder value. We firmly believe that the current stock price
is significantly undervalued, as the stock trades at a substantial
discount to our net cash value and net asset value and fails to
reflect our long-term growth potential.”
“While the implementation of the commission cap
since the second quarter of 2024 has posed significant challenges
to the insurance intermediary industry in China, causing short-term
fluctuations in our stock price, we believe the market is gradually
adapting to these changes, and a new balance is forming. We remain
confident in the robust prospects of China's insurance industry.
Insurance assets, as defensive assets, will continue to grow, and
insurance intermediaries, as independent third parties, possess
unique advantages, serving as indispensable sales channels for both
insurance companies and consumers. The deep integration of
technology, particularly advancements in artificial intelligence,
will drive down consumer acquisition costs, improve operational
efficiency, and become a powerful catalyst for industry
growth.”
He continued, “In response to the rapid changes
in the industry, we have implemented proactive and effective
measures to maintain stable operations. Bolstered by our strong
cash generation capabilities, our balance sheet remains robust,
providing us with significant financial flexibility to execute our
growth strategies for sustainable long-term growth. Additionally,
we have made notable progress in our intelligent strategic
upgrades. Our AI agent 'Du Xiaobao,' developed in collaboration
with Baidu Smart Cloud, will officially launch in August. This
innovation is expected to significantly enhance our customer
service capabilities and operational efficiency, further
solidifying our leading position and continuously creating value
for our shareholders.”
“Our decision to invest personal funds in Fanhua
reflects our strong belief in the company’s future and our
dedication to driving sustainable growth. We are confident in our
strategic direction and are committed to delivering long-term value
to our shareholders,” said Mr. Hu.
About Fanhua
Established in Guangzhou in 1998 and listed on
NASDAQ in 2007 (Nasdaq: FANH), Fanhua is a leading independent
financial services provider in China with strong technology
capabilities and a commitment to empowering financial advisors and
fostering sustained value creation for customers.
Our mission revolves around creating an
inclusive and collaborative platform for independent financial
advisors, as well as various insurance/financial sales
organizations, enabling our partners to optimize their practices by
offering them end-to-end business solutions spanning compliance,
technology, products, services, operations, capital flow, and
professional training.
Leveraging advanced technology, artificial
intelligence, and data-driven insights, Fanhua is at the forefront
of revolutionizing financial services delivery, accelerating
digital transformation, and driving industry growth.
With a comprehensive approach to financial
services, we connect millions of Chinese families with various
financial institutions and service providers, offering a diverse
range of opportunities and personalized solutions for insurance
protection, retirement planning, health management, asset
management, and family governance services, covering the full
lifecycle of our customers’ needs.
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
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 and their
potential impact on the sales of insurance products. Except as
otherwise indicated, all information provided in this press release
speaks 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.
For more information, please
contact:
Fanhua Inc. Investor
Relations Tel: +86 (20) 8388-3191 Email: ir@fanhgroup.com
Source: Fanhua Inc.
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