OneConnect Releases Q3 2024 Results with Net Profit attributable to Parent Company Reaching RMB110 million
HONG KONG SAR - Media OutReach Newswire - 14 November 2024 - OneConnect Financial Technology Co., Ltd ("OneConnect" or the "Company", NYSE: OCFT, HKSE: 6638), a business technology service provider for financial institutions, announced its results for the first three quarters ending September 30, 2024.
2024 is a pivotal year for OneConnect as it advanced the second phase of its strategy, focusing on "product upgrades, deepening customer relationships, and overseas expansion." OneConnect continued to accelerate the output of Ping An's technology and its own product development, concentrating resources to create high-value, high-barrier products. In the meantime, the Company has been actively expanding in overseas markets, tailoring products to address local market demands and institutional pain points while exploring innovative collaboration models to meet the increasingly diverse needs of the global digital finance landscape.
Net Profit attributable to the Parent Company reached RMB110 Million in First Nine Months
Throughout this year, OneConnect's profitability has further improved, and its overseas business has maintained robust growth.
In the third quarter of 2024, OneConnect's continuing operations (excluding the virtual banking business) generated revenue of RMB417 million. The net loss attributable to the parent company improved to RMB30 million, compared to RMB51 million in the same period last year, representing a 41.9% year-over-year reduction. Gross margin and adjusted gross margin reached 32.7% and 35.6%, respectively. For the first nine months of 2024, OneConnect's continuing and discontinued operations achieved a net profit attributable to the parent company of RMB110 million, a 138.9% year-over-year increase, with a net profit margin of 6.0%, up 16.7 percentage points. Furthermore, revenue from third-party overseas customers grew by 23.4% year-over-year during the first nine months.
Mr. Shen Chongfeng, OneConnect's Chairman of the Board and CEO, stated that since 2024, the Company's overseas business has maintained strong growth momentum, and profitability has further improved. These achievements are attributed to the Company's active adjustment of its product portfolio, deepening customer relationships, expansion in domestic and overseas markets, and continued to implement strict cost control, which laid a solid foundation for mid-term profitability.
"In the future, OneConnect will focus on increasing product standardization rates and deliver more high-value products to further enhance gross margin levels. The Company will continue to optimize its cost structure, engage in overseas business expansion, invest in targeted and strategic R&D for high-value products, and deepen collaborations with high-quality customers. We believe these measures will fuel OneConnect's high-quality growth and create more value for customers and shareholders" Lin Rubo, OneConnect's CFO, said.
Overseas Business as a Strong Growth Engine
In the first three quarters of 2024, OneConnect's third-party overseas customers revenue rose 23.4% year-on-year, with its share in total revenue increased to 22.8% (excluding virtual banking business), up by seven percentage points year-on-year.
In the third quarter, OneConnect successfully launched the upgraded SLP (Smart Loan Platform) project, which empowered overseas customers to enhance their business expansion capabilities and improved their operational efficiency. The SLP project showcases OneConnect's technological strength and product value, which received high recognition from multiple institutions. Currently, the Company's products have materialized applications across a wide range of sectors overseas, including regional banks, digital banks, and financial companies. Moving forward, OneConnect aims to expand its presence in six ASEAN countries—Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Brunei—leveraging its product capabilities and technological prowess to further enhance its overseas influence.
As of the end of the third quarter, OneConnect's business has spanned over 20 countries and regions, including South Africa, Singapore, Thailand, Malaysia, Indonesia, the UAE, the Philippines, and Vietnam, serving a total of 192 overseas financial institutions, including the top three regional banks in Southeast Asia and two of the top ten global insurance companies.
Shen Chongfeng pointed out that, OneConnect's smart credit solution is well-received among overseas bank customers, which reflected the increasing recognition of its products and services. This is the result of the Company's commitment to product integration and upgrades, deepening customer relationships, and innovative partnership models. Looking ahead, OneConnect will continue to leverage artificial intelligence (AI) to enhance product competitiveness and capitalize on opportunities in overseas markets.
In the third quarter of 2024, OneConnect received several awards from third-party institutions and authoritative media, including the "IDC China Top 50 Emerging FinTech", "Forbes China Top 50 FinTech Influential Enterprises," "Forbes China Top 10 FinTech ESG Practice Enterprises," and the "4th NIFD-DCITS FinTech Innovation Case" by the National Institution for Finance & Development, accumulating a total of 318 awards to date. These accolades underscore the recognition from the industry and the society, regarding the technological prowess of OneConnect's products and its industry influence.
Continued Product Integration to Serve Core Customers
Shen Chongfeng said that OneConnect is now in the crucial phase of its 2.0 strategy of "deepening customer relationships." The Company will continue to focus on financial institution customers by integrating and optimizing products and services, prioritizing three core business segments: Digital Banking, Digital Insurance, and the Gamma Platform. This approach will enhance product capabilities, empowering financial institutions to improve efficiency and achieve successful digital transformation.
For the retail segment of digital banking, OneConnect continued to promote digital transformation by focusing on comprehensive customer management, precise product recommendations, and smart channel operations; to assist the retail segment of digital banking to implement smart operations.
For the credit segment, OneConnect has established a lightweight smart credit management system and an inclusive finance platform to build smart credit management capabilities and enable financial institutions to advance in inclusive finance. The Company has also formed partnerships with several foreign banks in digital lending, including a longstanding collaboration with Commerce International Merchant Bank (CIMB), which focused on co-developing customized products to enhance the customer experience.
For digital insurance, OneConnect has implemented several end-to-end SaaS deployment benchmarks, including a project with a major state-owned property insurance company that addresses pain points in claims, underwriting, and service processes; helping customers to enhance risk control in claims and improve underwriting quality. In the Hong Kong market, OneConnect has fully implemented an ePOS platform for a medium-sized Hong Kong insurance company, it has been widely adopted by over 100 brokerage firms and over 1,000 agents, which has significantly expanded its market reach and drove effective growth. That ePOS platform now has an average usage rate of over 80% across all channels.
In addition, OneConnect leveraged the smart solutions of the Gamma Platform to continue to focus on the financial, government, and large corporate customers while aggressively expanding in overseas markets to empower digital decision-making, operations, and management. For instance, its upgraded smart visual risk control platform integrated advanced AI technologies such as fingerprint recognition and micro-expression analysis, which enhanced fraud prevention capabilities. Furthermore, OneConnect launched an HKID eKYC solution in Hong Kong, reducing user operating time by 50% by optimizing user workflows.
Shen Chongfeng stated that financial institutions are facing numerous challenges in view of the digitalization trend. OneConnect will closely follow policy developments and market changes, leverages its unique "technology + business" advantage to continue enhancing its capabilities across digital banking, digital insurance, and Gamma Platform business segments, empowering financial institutions and enterprises to transform digitally and driving the development of new quality of productive forces in the financial sector.
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OneConnect Financial Technology Co., Ltd.
OneConnect Financial Technology Co., Ltd. is a Technology-as-a-Service (TaaS) provider for financial institutions and a national high-tech enterprise in China. As an associate of Ping An Insurance (Group) Company of China, Ltd. (Ping An Group), OneConnect leverages Ping An Group's over 30 years of extensive experience in financial services and its own research capabilities to provide clients with integrated products featuring "horizontal integration and vertical full coverage"—including Digital Banking, Digital Insurance, and Gamma Platform, a digital financial infrastructure platform. With our unique "technology + business" competency, we help clients improve efficiency, enhance services, reduce costs and risks, and achieve digital transformation.
· OneConnect listed on the New York Stock Exchange (NYSE) in December 2019.
· According to CIC, OneConnect ranked second among listed TaaS providers in China in terms of 2020 financial software and services revenue.
· In September 2021, the Company put forward the upgraded "Unite the Core, Empower the Wings" strategy, focusing on serving the digital transformation of financial institutions as the core, while simultaneously expanding its ecosystem and overseas presence as the "wings" to actively promote the overall digital transformation of the financial services ecosystem.
· OneConnect listed on the Hong Kong Stock Exchange (HKEX) in July 2022.
OneConnect possesses strong capabilities in cutting-edge technologies such as Artificial Intelligence, Big Data, and Blockchain. The Company has been included in KPMG's "China Leading Fintech 50" list for six consecutive years (2018-2023) and the IDC FinTech Rankings Top 100 list (rising to 59th in 2021). OneConnect has garnered the prestigious Wu Wen Jun AI Science and Technology Progress Award, the 2023 National May Day Labor Certificate, and 78 other international professional awards, and has also obtained CMMI5 international certification.
