Cango Inc (NYSE:CANG) reported a stable overall business performance with a total revenue of RMB26.95 million, an operating profit of RMB35.24 million, and a net profit of RMB67.88 million for the third quarter of 2024.
The company successfully implemented stricter cost control and risk management strategies, significantly improving operational efficiency.
Cango Inc (NYSE:CANG) maintained a low non-performing loan ratio through reinforced monitoring mechanisms and risk assessments, ensuring asset quality and stability.
The Cango U-Car App saw a 21% increase in page views from the previous quarter, indicating growth in user engagement and interest.
Cango Inc (NYSE:CANG) made significant progress in its international used car platform, Auto Kle.com, which accumulated over 370,000 page views and nearly 60,000 registered users since its launch in March 2024.
Negative Points
Total revenues in the third quarter of 2024 were RMB27.0 million, a significant decrease compared to RMB353.6 million in the same period of 2023.
The company's cash and cash equivalents decreased to RMB691.8 million as of September 30, 2024, from RMB949.5 million as of June 30, 2024.
Cango Inc (NYSE:CANG) predicts a further decline in total revenues for the fourth quarter of 2024, estimating between RMB15 million and RMB17.5 million.
General and administrative expenses increased to RMB45.2 million in the third quarter of 2024, compared with RMB34.7 million in the same period of 2023.
The company faces challenges in integrating with overseas markets and optimizing Auto Cango's features and services to enhance user experience and expand market reach.
Q & A Highlights
Q: Considering the moderate recovery of the Chinese economy, how does the company view the potential impact of the future macroeconomic environment on its business? What specific vehicle quality assurance measures has the company taken to ensure the safety and reliability of used cars? A: Lin Jiayuan, CEO, stated that the moderate economic recovery in China is expected to positively impact Cango's business by boosting consumer confidence and purchasing power, which should stimulate growth in the automotive market, particularly in used cars. The company collaborates with reputable dealers and conducts over 100 professional technical inspections on each vehicle to ensure quality and reliability. Detailed inspection reports are provided to buyers, and a dedicated team handles feedback and complaints to improve service quality.
Q: How does the company plan to further integrate with overseas markets, and what are the plans for optimizing Auto Cango's features and services? A: Lin Jiayuan, CEO, explained that Cango is conducting comprehensive research on overseas markets and engaging with local partners for localized support. The company plans to enhance its international visibility through social media and offer multilingual support. By early 2025, Auto Kle.com will be available in 15 languages. Cango is also introducing a direct sourcing feature for the Chinese used car market and enabling online queries for overseas users to access vehicle information quickly.
Q: What measures has Cango taken in terms of cost control and risk management strategies to improve operational efficiency and financial structure? How will these measures impact future performance? A: Lin Jiayuan, CEO, highlighted that Cango has streamlined business processes, automated workflows, and enforced strict budget management to control costs. The company leverages cloud computing to reduce IT expenses and secures favorable pricing from top-tier suppliers. In risk management, Cango has a robust internal control system and conducts regular audits. These measures have improved the balance sheet, cash flow, and profit performance, laying a solid foundation for future strategic development.
Q: What are Cango's plans for developing talent with an international perspective and enhancing operational capabilities in overseas markets? A: Lin Jiayuan, CEO, mentioned that Cango plans to recruit international students in Shanghai for internship programs to provide practical experience and infuse the team with global insights. The goal is to create a diverse and globally competitive team that can better serve clients from various cultural backgrounds and advance the company's globalization efforts.
Q: How is Cango leveraging digital capabilities to mitigate potential macroeconomic fluctuations? A: Lin Jiayuan, CEO, stated that Cango is enhancing operational efficiency, strengthening customer experience, and leveraging digital capabilities to mitigate macroeconomic fluctuations. The company is exploring new growth opportunities and value-adding services to adapt to market needs and maintain resilience against economic changes.
