PintecTechnology Holdings Ltd (PT) stock prices were up by a substantial 44.375% sometime after the market opened on May 17th, 2021, bringing the price per share up to USD$1.155 early on in the trading day.
Technical Service Fees Revenues
As a result of PT’s decrease in balance sheet loans facilitated by the company in the fiscal year 2020 as it redirected its focus away from services using a risk-sharing model, revenues from technical service fees were down by 69.3% compared to the prior year. While revenues for the year ended December 31st, 2020 were down from USD$167.38 million for the year ended prior, to USD$50.7 million.
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Installment Service Fees Revenues
Revenues from installment service fees also saw a substantial drop, largely attributable to a decrease in PT’s on-book installment loan volume during the fiscal year 2020. Revenues from this segment were down from USD$29.1 million for the year ended December 31st, 2019 to USD$6.5 million as of December 31st, 2020, indicating a reduction of 77.2%.
Wealth Management Service Fees Revenue
Owing to the transition from a business model dependent on cross-selling through retail credit channels to a more market-oriented model, PT experienced a decline in the prior serving offering. As a result, revenues generated from wealth management service fees saw a year-over-year decrease of 75.7%. For the year ended December 31st, 2020, the company reported USD$0.8 million down from the USD$3.12 million reported for the year ended December 31st, 2019.
Solid Liquidity Position
PT reported having a cumulative total of USD$80.1 million as of December 31st, 2020 in cash, cash equivalents, and short and long-term restricted cash. This is comparable to the USD$90.1 reported as of December 31st, 2019. Over the course of 2020, the company saw a stark reduction in its total net financing receivables as of December 31st, 2019. The reports, which included short and long-term receivables, indicated an 83.6% reduction from USD$69.81 million as of December 31st, 2019 to USD$11.3 million as of December 31st, 2020. This massive decrease is largely attributable to the lower volume of the company’s on-balance sheet loan business which it had anticipated.
Future Outlook for PT
Not having managed to entirely escape the vicious effects of the persistent covid-19 pandemic, PT managed to mitigate potential disaster. As a part of the steps the company took to adapt and ensure further future growth, their balance sheet took a hit. Nevertheless, armed with a solid liquidity position and the resources at their disposal, current and potential investors are hopeful that the company will continue to leverage those resources to facilitate significant and sustained increases in shareholder value.
