Waterdrop, Inc. (NYSE:WDH) Q3 2023 Earnings Conference Call December 7, 2023 7:00 AM ET

Company Participants

Peng Shen - Chairman, Chief Executive Officer

Zetao Zhu - General Manager, Crowdfunding and Pharmatech Business

Guang Yang - Director and VP, President, Finance, General Manager, International Business

Conference Call Participants

Unidentified Company Representative

Good morning, everyone. This is from Waterdrop Investor Relations. It's my pleasure to welcome everyone to Waterdrop's Third Quarter 2023 Earnings conference call. [Operator Instructions]. As a reminder, today's conference call is being recorded.

Please note that the discussion today will contain forward-looking statements made under the Safe Harbor provision of the US Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from our current expectations. Potential risks and uncertainties include, but are not limited to those outlined in our public filings with the SEC. The company does not undertake any obligation to update any forward-looking statement except as required by any applicable law.

Also, this call includes discussion of certain non-GAAP measures. Please refer to our earnings release for a reconciliation between non-GAAP and GAAP.

Joining us today on the call are Mr. Shen Peng, our Founder, Chairman, and CEO; Mr. Yang Guang, Co-Founder, Director, Finance VP, and GM of International Business; Mr. Zhu Zetao, GM of Crowdfunding and Pharmatech Business; Mr. Chen Richard, Board Secretary.

And we will be happy to take some of the questions in the Mandarin line at the end of the conference call.

Peng Shen

Hello, everyone. This is Shen Peng. Thank you for joining our third quarter 2023 earnings conference call.

This quarter, the domestic economy in China is still in the recovery process. Primary factors, including adjustments in product policies have temporarily impact the life insurance business. With the improvement in industry transparency and generation coupled with gradual acceptance of new product policy in the market, the company believes that the life insurance industry is entering a new development stage.

Facing both opportunities and challenges, the company actively respond to regulatory direction, striving to enhance business health and efficiency. For our having either certification, the company leveraged its keen insight into user needs to qualify either service and product innovation capabilities, embracing industry change with any vision and dynamic approach.

In the third quarter, the company continued to focus on creating value for users, achieving a resilient financial performance with approximately RMB6.9 billion in revenue maintaining a profitable trend for the past seven quarters. Cash profit reached RMB36.3 million, showing our Q3 growth of 67% and demonstrating this event sustainable and high-quality development. With sustainable net profit and positive operating cash flow at the end of September in the context of continuous share repurchase and acquisition of Shenlanbao, the company is to maintain our robust cash reserve and ability to organic growth.