Cango Inc. (NYSE:CANG) Q3 2023 Results Conference Call November 27, 2023 8:00 PM ET
Company Participants
Jiayuan Lin - CEO
Yongyi Zhang - CFO
Operator
Good morning and good evening, everyone. Welcome to Cango Inc's Third Quarter 2023 Earnings Conference Call. [Operator Instructions] This call is also being broadcast live on the company's IR website.
Joining us today are Mr. Jiayuan Lin, Chief Executive Officer; and Mr. Yongyi Zhang, Chief Financial Officer of the company. [Operator Instructions] Before we begin, I refer you to the safe harbor statement and the company's earnings release, which also applies to the conference call today as management will make forward-looking statements. As a reminder, today's conference is being recorded.
With that said, I am now turning the call over to Mr. Jiayuan Lin, CEO of Cango. Please go ahead, sir.
Jiayuan Lin
[Foreign Language]
Unidentified Company Representative
Hello, everyone, and welcome to Cango's Third Quarter 2023 Earnings Call.
Jiayuan Lin
[Foreign Language]
Unidentified Company Representative
In the third quarter of 2023, both production and demand continue to be under strength. Despite the introduction of economic stimulus measures, overall consumer confidence has yet to fully recover.
Jiayuan Lin
[Foreign Language]
Unidentified Company Representative
The automotive market in China is characterized by intricate dynamics. Although the post-pandemic era in 2023 saw a resurgence in consumer demand for automobiles, it has been slow to pick up pace. As a result, major auto manufacturers have rolled out discount policies on new car purchases, leading to a sustained decrease in retail prices. In the first 3 quarters, the overall sales in the automotive market exhibited a modest recovery with new energy vehicles, NEVs in short, and exports serving as the primary driver of market growth.
Jiayuan Lin
[Foreign Language]
Unidentified Company Representative
On distribution, the profitability of car dealers have been severely impacted by pricing wars. Consequently, they have transitioned towards an on-demand vehicle purchasing to alleviate inventory accumulation and operational stress. As per data released earlier by the China Automobile Dealers Association, 50% of auto dealers reported losses in the first half of this year, the highest level in recent years. Indeed, the impact extends beyond car dealers. All parties in the automotive value chain, including Cango, have faced unprecedented pressure.
Jiayuan Lin
[Foreign Language]
Unidentified Company Representative
In Q3 2023, the company's total revenues amounted to RMB 354 million, making a year-on-year decline of 15.1%. Despite incurring a net loss of RMB 49.09 million due to goodwill impairment, our overall operating efficiency and reduced financial provisions helped us achieve a smaller net loss compared to RMB 130 million in the same period of last year. As of September 30, 2023, we managed to shrink the total outstanding balance of financing transactions to RMB 13.1 billion while maintaining M1+ and M3+ at a steady rate of 2.42% and 1.24%, respectively.