X Financial Enters Share Repurchase Agreement Worth $48.7 Million to Boost Investor Confidence

X Financial's Strategic Share Repurchase

X Financial, a prominent name in the online personal finance sector in China, has recently disclosed an ambitious repurchase plan aimed at bolstering its stock value. On December 16, 2024, the company entered into an agreement to repurchase 6,349,206 American depositary shares (ADSs), totaling approximately 38,095,236 Class A ordinary shares, at a price of $7.67 per ADS. This strategic move translates to a substantial investment of around $48.7 million, reflecting the company's commitment to enhancing shareholder value and solidifying its financial standing.

In conjunction with this repurchase agreement, the board of directors has sanctioned a new share buyback program, allowing for the repurchase of up to $50 million worth of Class A shares until June 30, 2026. Following this most recent repurchase, X Financial will conclude its two prior repurchase initiatives, leaving about $15.9 million available for future buybacks under this new plan.

Frank Fuya Zheng, the company’s Chief Financial Officer, conveyed a strong positive sentiment regarding this share repurchase agreement. He stated, "We are pleased with this share repurchase agreement as it reflects our confidence in our long-term growth potential and our commitment to enhancing shareholder value." Zheng emphasized the company’s sound financial stability and indicated their intention to pursue a balanced approach toward capital management, ensuring that both growth opportunities and shareholder value creation are prioritized.

In 2024, X Financial has demonstrated a significant dedication to returning value to its shareholders, having returned approximately $76 million through a combination of dividends and share repurchases. This includes $16.5 million in cash dividends, $9.2 million resulting from a tender offer, the recent repurchase of $48.7 million, and an additional $1.6 million from other repurchases. Together, these transactions amount to an impressive total of around 52.2 million Class A ordinary shares—equivalent to 17.8% of the company’s total outstanding shares as of December 31, 2023.

Moving forward, the company remains focused on sustaining profitable growth while continuing to return value to shareholders through dividends and additional share buybacks. Under the newly established repurchase plan, shares could be acquired via multiple channels such as open market transactions or privately negotiated agreements, depending on market conditions and relevant regulations.

X Financial, traded on the NYSE under the symbol XYF, is not just committed to maintaining strong relationships with its investors; it also leverages advanced big data technology to connect borrowers with institutional funding partners. This intricate network helps them assess risks effectively, ensuring that they extend loans primarily to quality borrowers, independent of market fluctuations.

As a leading player in the Chinese online personal finance landscape, X Financial's recent moves are crucial steps in demonstrating resilience in a competitive market. The strategic buyback signifies a proactive approach to drive the company's growth and enhances overall shareholder trust.

In conclusion, X Financial's decision to reinvest in its own stock underscores a commitment to providing value to its shareholders while maintaining a robust growth trajectory in the evolving financial services sector.