Noah Holdings Ltd. Q3 FY2024 earnings call

• International Expansion: Launched new brands like ARK Private Wealth, Olive Asset Management, and Glory Family Heritage. Expanded into key markets such as Southeast Asia, Japan, etc. Increased overseas relationship managers to 146. Overseas AUA including third-party distributed products reached $8.7 billion.
• Domestic Refinement: Remained committed to refining operations, ensuring compliance, reducing costs, and focusing on client interest-protecting products. Emphasized investor education and deep client engagement.
• Financials: Third quarter net revenue reached RMB684 million, an 11% sequential increase. Overseas business drove growth. Operating profit for the quarter was RMB241 million, with an operating margin of 35%.

International: Net revenues from overseas were RMB377 million, an increase of 28.9% year-on-year and 35.3% sequentially, accounting for over 50% of group revenue for the first time. US dollar AUA and AUM increased by 5.7% and 16% year-over-year respectively. ARK Private Wealth total registered clients exceeded 17,200, with 17,038 accounts opened in Hong Kong, 735 in Singapore, and over 1,000 in the US. Glory Family Heritage generated total revenue of RMB145 million in the third quarter, an increase of 42.4% year-on-year. Domestic: Net revenues from mainland China contributed RMB312 million, a decrease of 32.6% year-on-year. Noah Upright generated total revenues of RMB108 million, a decrease of 21.7% year-on-year. Gopher Asset Management achieved total revenue of RMB181 million, a decline of 17.3% year-on-year.

• Continued active expansion of international businesses by increasing local branches, strengthening relationship manager teams, and enhancing online services.
• Focus on client-centric sales model and providing long-term asset allocation advice across safety net, cash management, and growth strategy perspectives.

• Forward-looking statements subject to risks and uncertainties outlined in public filings with SEC and Hong Kong Stock Exchange, including regulatory changes and market uncertainties.

Q: Obviously observing excitement on the equity market since September, wondering to what extent Noah can participate in the rising sentiment and how it impacts revenue and profitability, and how Noah advises clients on asset allocation.

A: Zander Yin mentioned third quarter financial results were largely not impacted by recent policy changes. CIO house view still advocates advising clients to use RMB assets to invest in global beta returns. Haven't changed CIO house view but enhanced RMB side product shelf.

Q: Regarding domestic revenue pressure and overseas improvement, can revenue trend stably improve and what's the largest driver for revenue outlook. Also, trend in customer behavior after big stimulus in mainland China.

A: Grant Pan said it's too early to say revenue trend has turned. Zander Yin mentioned seeing more client communication, continuing to provide long-term asset allocation advice through safety net, cash management, and growth strategy perspectives, still undergoing transition to new sales model.