Bitauto Holdings Limited (BITA) Q1 2018 Earnings Conference Call Transcript

Bitauto Holdings Limited (BITA)
Q1 2018 Earnings Conference Call
June 13, 2018, 8:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Hello and thank you for standing by for Bitauto's First Quarter 2018 Earnings Conference Call. At this time, all participants are in listen-only mode. After management's prepared remarks, there will be a question and answer session. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to turn the meeting over to your hosts for today's conference

Company Representative

Thank you and welcome to Bitauto's First Quarter 2018 Earnings Conference Call. Speakers from the company today are Mr. Andy Zhang, CEO, and Ms. Cynthia He, CFO of Bitauto. After their prepared remarks, Andy and Cynthia will be available to answer your questions. In addition, Catherine Liu, CFO of Yixin, will be available to answer your questions related to Yixin.

Before we proceed, please note that discussions today will contain forward-looking statements made under the Safe Harbor provisions of the U.S. Private Securities and Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties, which 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, including the registration statement on Form F-1. Bitauto does not undertake any obligations to update any forward-looking statement except as required under applicable law. This call will include discussions of certain unaudited non-GAAP financial measures. Please refer to our earnings release, which was issued earlier today, for reconciliations of these unaudited non-GAAP measures to the most directly comparable unaudited GAAP measures.

As a reminder, this conference is being recorded. In addition, a live and archived webcast of the conference will be available on our website. I will now turn the call over to Andy Zhang, CEO of Bitauto.

Andy Xuan Zhang -- Chief Executive Officer and Director

Hello, everyone. Thank you for joining us for our First Quarter 2018 Earnings Conference Call. We're pleased to start the year with a set of solid first-quarter results, which show strong progress across all three of our business segments. Total revenue grew a healthy 52.3% year over year to RMB2.17 billion in the first quarter. Revenue from our Advertising and Subscription business continued to grow steadily, growing 16.3% year over year to RMB787.5 million. More notably, revenue from our Transaction Services business expanded rapidly to achieve an impressive year-over-year growth of over 100%, reaching RMB1.17 billion. This was thanks to the robust growth momentum in transaction volumes related to both our loan facilitation and the self-funded financing lease services.

Yixin conducted over 110,000 financed automobile transactions in the first quarter. In particular, Yixin's third-party loan facilitation transactions continued to gain momentum, contributing almost 30% penetration in the month of April. We expect to see this contribution continue to expand in the quarters ahead. Yixin entered into a set of agreements with Yusheng, a company that is principally engaged in the used automobile transaction business.

Given the recent intensifying industry competition, we believe that to build a leading used car business will require sizable investments and years of nurturing. We believe that our cooperation with an investment in Yusheng, together with strategic investors such as Tencent and JD.com, will enable Yusheng to increase its comparativeness more quickly and be better positioned to benefit from the growth potential of China's used automobile market. At the same time, Yusheng will give Yixin preferred cooperation rights for used car financing, which will strengthen Yixin's core competency in the financed used car transaction business.

Going forward, Yixin will be focused on our fast-growing auto financing transaction business, primarily including platform loan facilitation, self-operated finance leasing, operating lease, auto insurance and other after-sales services. As auto financing transactions are the most profitable among all auto-related transactions, we believe that Yixin's strategic focus will strengthen its market leadership.

Lastly, as you have seen from our earnings announcement today, Mr. Ming Xu will be joining us as Chief Financial Officer, succeeding Cynthia. I think some of you might be familiar with Ming already. Ming possesses deep understanding of China's internet and automobile industries, as well as rich experience in the capital markets. I'm confident that he will be a valuable addition to our management team. We also greatly appreciate the contributions Cynthia has made over the last two years. Cynthia will remain with the company during the upcoming weeks to ensure a smooth transition. With that, I'll turn the call over to Cynthia to go over the financials.

Cynthia He -- Chief Financial Officer

Thank you, Andy, and hello, everyone. Bitauto reported total revenue of RMB2.17 billion for the first quarter of 2018, representing a 52.3% increase from the corresponding period in 2017. The increase in revenue was attributable to the growth of all three of the company's revenue segments. Now, let me go through the different segments.

Revenue from Advertising and Subscription for the first quarter of 2018 was RMB787.5 million. This represents a 16.3% increase. Revenue from Transaction Services was RMB1.17 billion. This represents a 101% increase. The increase is caused by fast growth of transaction volume for both loan facilitation and self-operated finance leases. Revenue from Digital Marketing Solutions business was RMB211.3 million. This represents a 28.2% increase.

Cost of revenue for the first quarter of 2018 was RMB821.4 million, representing a year-over-year increase of 95.6%. This is primarily due to increased funding costs related to the growth of Transaction Services. Gross profit for the first quarter of 2018 was RMB1.35 billion, representing a 34.3% increase. Selling and admin expenses was RMB1.51 billion for the first quarter. This represents a 64% increase.

The increase was caused by three different factors: 1). Marketing efforts, 2). Provision for credit losses of financed receivables, and 3). Headcount and related expenses. Product development expense was RMB160 million. This represents a 37.3% increase. This is mainly due to increases in headcount related to product development. Share-based compensation, which was allocated to related operating expenses -- different line items -- was RMB150.1 million in the first quarter of 2018. This is compared with 65.2 million in the corresponding period in 2017. The increase was mainly due to options granted by Yixin employees in the third quarter of 2017.

Non-GAAP income from operations in the first quarter was RMB8 million. Non-GAAP net income in the first quarter was RMB37.1 million. Non-GAAP basic undiluted net income per ADS in the first quarter of 2018 amounted to $0.88 and $0.84 respectively. As of the end of March, the company had cash and cash equivalents and restricted cash of RMB10.21 billion. Cash provided by operating activities in the first quarter was RMB181.8 million. Cash used in investing activities was RMB4.17 billion and cash provided by financing activities was RMB3.35 billion. The number of employees totaled 8,962 groupwide as of the end of March. This represents a 17% annual increase and is primarily due to the increases in personnel in the fast-growing Transaction Services business as well as in product development.

Now, given Yixin's scale and significance to Bitauto, I would like to share with you some of Yixin's operating and financial highlights in the first quarter. Under U.S. GAAP, Yixin's total revenues reached RMB1.23 billion. Gross profit reached RMB598.7 million. Net loss was RMB221.4 million and non-GAAP net loss was RMB62.3 million. The non-GAAP measures -- namely, non-GAAP net loss -- is calculated by net loss excluding share-based compensation of RMB109.8 million plus amortization of intangible assets resulting from assets and business acquisitions of RMB49.9 million, offset by a tax effect of RMB0.5 million.

Also, in Q1, Yixin entered into certain transactions with other subsidiaries of Bitauto. They have been eliminated upon Bitauto's consolidation of Yixin. The revenues that Yixin recorded for such transactions amounted to RMB29.3 million. At quarter end, Yixin had cash and cash equivalents and restricted cash of RMB5.44 billion. Total financed receivables were RMB33.8 billion and total borrowings were RMB28.49 billion. Total borrowings include bank borrowings and asset-backed securities. As of March 31st, 2018, Yixin's past-due ratios for 30-plus days, 90-plus days, and 180-plus days were 1.45%, 0.93%, and 0.39% respectively. We believe past-due ratios will remain stable in 2018.

Before we turn to Q2 guidance, let me take a few minutes to walk you through the changes in provision considerations for financed receivables under U.S. GAAP and IFRS, which has become a frequently asked question from the investment community. With regard to provisions for credit losses of financed receivables, the current U.S. GAAP standard applicable to Bitauto follows an incurred-loss model, while IFRS 9, the newly effected IFRS standard applicable to Yixin, follows an expected-loss model. Typically, the IFRS standard applicable to Yixin is expected to yield more stringent results than the U.S. GAAP standard applicable to Bitauto. This is because IFRS requires the assessment of provisions for all financed receivables, including those that have not become past due. So, as of March 31st, 2018, the balance of provisions for credit losses under U.S. GAAP was RMB275 million and the total of RMB179.4 million was recorded as expenses in the first quarter.

At the same time, while under IFRS, based on our current estimates, which are subject to review and changes, the balance of provision for credit losses was RMB416 million and the total of RMB130 million was reported as expenses in the first quarter of 2018. IFRS 9 permits the use of retrospective approach; therefore, upon adoption of the new standard in 2018, the retrospective impact as of year-end 2017 would be reported in equity on Yixin's consolidated balance sheet. You may find more detailed explanations for the two accounting principles' comparisons of respective results in our earnings release to help you get a closer understanding of the GAAP differential, which will likely exist until Bitauto adopts ASC Topic 326. Again, these estimates for provisions reflect our best assessments currently, considering all available information to us now, and may be subject to further review and adjustments.

With that, I'll turn to guidance for the second quarter of 2018. Bitauto currently expects to generate revenue in the range of RMB2.47 billion to RMB2.52 billion in the second quarter of 2018. This will represent a 23.8% to 26.3% increase from the corresponding period in 2017. If the guidance were presented on a growth basis, which is consistent with our revenue guidance in 2017. Before we were required to adopt ASC 606, the forecasted revenues would have been between RMB2.66 billion to RMB2.71billion, and this would have represented a 22.5% to a 24.9% increase from the year-ago period. This forecast takes into consideration of seasonality and the impact of foreign currency fluctuation. It reflects management's current and preliminary view, which is subject to change.

Last, I would like to welcome Ming Xu, our new CFO, to join the team, and it has been a pleasure working at Bitauto with all of you, of course, over the past two years. I wish the company and everyone the best, and I hope our paths will cross again in time. Let's now start the Q&A session. Andy, myself, and Yixin's CFO Catherine Liu are available to take your questions. Operator, please go ahead.

Questions and Answers:

Operator

Thank you, ladies and gentlemen. The question and answer session of this conference call will start in a moment. In order to be fair to all callers who wish to ask questions, we will take one question at a time from each caller. If you have more than one question, please request to join the question queue again after your first question has been addressed. To ask a question on the phone, please press *1 and wait for your name to be announced. If you wish to cancel your request, you can also press #. Our first question comes from the line of Binbin Ding of JPMorgan. Please go ahead.

Binbin Ding -- JPMorgan -- Analyst

Good evening, management. Thanks for taking my question. Congratulations on a stronger-than-expected result. I have two questions here. The first question is regarding Yixin's investment in Yusheng. You mentioned that Yusheng has injected its used car transaction business, including the Taoche app and taoche.com to Yusheng. So, what kind of revenue impact shall we expect on both Yixin and Bitauto going forward? Which of the business segments will see the largest impact?

My second question on the competition within the used car transaction -- can you elaborate on Yusheng's growth strategy in the used car business given the intensified competition in this segment? Also, how will Yusheng leverage the resources from Bitauto and Yixin to deliver better growth in the future? Thank you.

Andy Xuan Zhang -- Chief Executive Officer and Director

Thanks. I'll answer the first part of the question, then Catherine will answer the later part. First of all, recently, one of our major competitors on the used car front has publicly filed their financial statements to seek a potential initial public offering in the U.S. I think that has been really revealing the real battleground of the used car business in China. We've also seen a lot of different competitors in this particular sector who each have been [inaudible] capital fundings ranged from RMB300 million to upwards of more than RMB800 million within the last six months. So, that got us thinking, obviously.

We also realized during the public filings of the competitor that the majority of the revenues are actually coming from financing-related transactions in the used car business, and given that what we've seen today -- as Yixin has been conducting -- we've also noticed a pattern where that in the used-car-financing-related activities are looking to be more likely profit-making. However, it would be very difficult to only stick to that. You need to create a setting where you're welcoming all different kinds of consumers, not only those who need leverage, but also, those who are willing to deal a transaction on a cash basis.

But, unfortunately, while cash-based transactions in the used car business in the past many years have been yielding losses for those who are carrying that particular setting to create that particular environment for these transactions that will be conducted. So, therefore, up until today, we have not seen any one of the used car transaction platforms being profitable, or not even close to being profitable.

So, the strategy of the company from Yixin's perspective -- we'd like to stick to the profitable transactions within that setting, and we're allowing -- along with the strategic investors like Tencent and JD, we're also getting investing in the transaction setting platform business where they create that particular setting, and also, be able to benefit Yixin to be collaborating with them on the finance-related transactions that relate to used car or whichever setting may bring in the future. I think that would be the most responsible approach for a company sized like Yixin, as well as companies with status like Yixin.

I think moving forward, we indicated fairly clearly that Yixin perceives its business focusing on the loan facilitations, either new car or used car, on the self-financing activities, as well as leasings, insurances, whatnot. So, we're focusing ourselves in the core business and we're creating opportunities for Yixin to still obtain additional used-car-related finance transactions at reasonable cost. So, this is the strategy that we're adopting moving forward in terms of looking at sustainable profit growth as well. In terms of the second part, I think I'll have Catherine answer.

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

We believe that with the investment capital that is going to be invested -- either through us and also through strategic investors such as Tencent, JD.com, and potential future investors -- Yixin will have the capital to grow its business at a faster rate, which we think will also benefit Yixin because Yusheng will give preferential cooperation rights to Yixin, which will enable us to enjoy the used automobile financing transaction growth.

So, from that perspective, we think that Yixin will benefit from this transaction. At the same time, Yixin can also use its resources -- either capital and other human resources -- to focus on this core business, which is also self-operated financing, as well as the loan facilitation services, particularly the loan facilitation services, as well as providing investor financing products and maintaining the asset quality, which I think is positive for Yixin.

Andy Xuan Zhang -- Chief Executive Officer and Director

Because Yixin will be running independently and have its own management team, therefore they have their own strategy as to expand in the market and market share. So, what we do is support them in that fact, just like other investors, as I mentioned, strategic and financial. So, moving forward, this particular company will be fully independently operated.

Binbin Ding -- JPMorgan -- Analyst

Thank you.

Operator

Thank you for the questions. The next question comes from the line of Monica Chen from Credit Suisse. Please ask your question.

Monica Chen -- Credit Suisse -- Analyst

Hi, good evening, Andy, Cynthia, and Catherine. Congratulations on a solid quarter, and also, congratulations to Ming Xu in the new role. I also have two questions. The first question is regarding the revamp efforts of the Advertising business. So, what work have we done so far in terms of constant improvement for the business, and how we expect that will drive the revenue for the rest of the year. The second question is regarding our Dealer Subscription business. So, what is our plan for product innovation and conversion improvement for this year, and how do we think about the pricing strategy given the competition and the dealers' willingness to pay for the service? Thank you.

Andy Xuan Zhang -- Chief Executive Officer and Director

Okay, I'll take both. Remember the stats from last year's first quarter. I think we've only grown just shy of 5% on the Advertising side of the business compared to the 16% in the first quarter of 2018. I think we've had a good first quarter thanks to the market. The market itself has also grown significantly, especially in January and February. These are the two months right before the Chinese New Year, and this time, in 2018, we had enjoyed our Chinese New Year to be one of the latest ones that I can remember in the past many years. Normally, before the Chinese New Year, it's a high season for auto consumption on the retail end. Consumers would like to purchase, lease, or loan a transaction before they actually go back to their hometown to let people know, "I've somehow made it with a new vehicle." So, therefore, the overall stats were quite encouraging.

However, again, I've always been optimistically cautious. I think that's not the first time I've said that. In the first five months of the auto sales, I think on the passenger car side, I think it was just a little over 5% growth. I think the entire year will be similar. So, that's the greater environment that's setting a tone, which -- I wouldn't say "impact" -- which influences our businesses from quarter to quarter. In terms from the dealer end of the business, my guess -- historically, the EP business -- Easy Pass -- has more or less purely focused on providing lease generated on behalf of our 23,000 to 25,000 paid members.

Moving forward, I think the new strategy is actually to expand the realm of services that we can provide. I think my initiative within the company is to really take that part of the business and turn it into a real SAS-oriented business, where we can add in different components other than just the pure lease gen, and that will also help us significantly differentiate from the position we currently have compared to the other competitors in the business where the [inaudible] only be able to provide lease. But, we can do a lot more.

If you're interested to know what more, I think we're undergoing quite a few different tests in terms of the aftermarket services, in terms of the first, second, and third -- different-tiered dealers where they can transact among themselves. So, these are the initiatives or efforts that's been undertaking in the past few months. At this moment, it's a little bit early to present any numbers or to say which of these trials have been successful, but hopefully, in the third quarter when we talk again, maybe I'll have a lot more color for people to see. So, that's the most recent update on the dealer side of the business.

So, basically, we want to build more functionalities, which will be really used and paid for by the dealers that'll really bring them values, that'll be integrated into my Easy Pass system, which currently is more or less -- 99% a pure lease gen tool versus a full-blown SAS. So, that's the area that we're moving into recently. So, thank you for your question. Hopefully, that answers both your questions.

Monica Chen -- Credit Suisse -- Analyst

Yeah, that's very helpful. Congratulations again.

Operator

Thank you. Next question comes from the line of Liping Zhao from CICC. Please ask your question.

Liping Zhao -- China International Capital Corporation Limited -- Analyst

Good evening, management. Thanks for taking my questions. I have two questions here. One is related to Yixin. As Bitauto provides guarantee liability for Yixin, what's the risk implication for Bitauto if default happens? And, my second question related to the Advertising business as well. Because Bitauto and Yixin both have advertising business, is there any conflict of interest in how we look at this business in the future? Thank you.

Andy Xuan Zhang -- Chief Executive Officer and Director

Okay, I think a lot of people have been asking the same question in the past few months. I'll make it very clear this time. I think at the time where an opportunity came along where we were able to obtain a license on -- the financial guarantor company license -- I think it was back in 2015, 2016 -- obviously, it sounds like it would be beneficial for Yixin's business because that's where its realm of business resides.

Unfortunately, at that time, Yixin had been very young from establishment time, from the size of its revenues, the profitabilities, and otherwise. So, we asked our parent company, BITA, to help, to obtain this license first with BITA's long-running history, its profitability, and size of revenue. So, we've done that. In the past 12 months, actually, not only BITA has been holding a license for Yixin, but also, there is a certain amount of business conducted within that company, which is mainly related to Yixin's loan facilitation business.

But, the good part is that because back then -- or, up until this moment -- the loan facilitating business has not accounted for the majority of Yixin's business, and it's my intention to have Yixin source out a third party who will provide the same type of services on behalf of Yixin, replacing the functionality of this particular company under BITA. The agreement will go as when Yixin has grown to the point where that it's capable of taking over that license, BITA will allow Yixin to transfer this license over to Yixin.

I think the timeframe that'll happen probably will be sometime in 2019, but regardless, moving forward, majority or almost all of Yixin's loan facilitation business -- if there's any guarantees involved, will seek out a third party instead of this particular company to work with. So, moving forward, in the second half of the year, you will now see this company be in an aggressive operating mode in general. So, that significantly limits the risk that BITA has to take on part of the loan facilitation business.

On the second part of the angle as well, because historically, Yixin also sells advertising to our OEMs over its own properties, Yixin Zheotai, daiquin.com [sic], as well as Taoche, et cetera. Moving forward, I think that Yixin will actually help to carry out the typical business. I think from Yixin's perspective -- from BITA's perspective -- we will actually sell to the OEMs as if we had acquired this particular asset from any other independent party.

For example, BITA actually contracts with Baidu or Aladdin, so that's essentially acquiring Baidu's traffic and reselling it to the OEMs or to the dealers. This will be very similar in action in between the business of BITA with Yusheng, where BITA will also purchase similar assets from Yusheng to resell to the OEMs. So, moving forward in the second half of the year, that particular overlap will also ease away. So, moving forward, we will not see that kind of overlapping again, so that's what will happen to that side of the so-called conflict. Thank you.

Liping Zhao -- China International Capital Corporation Limited -- Analyst

All right, very clear. Thanks.

Operator

Thank you for the questions. Next question comes from the line of Hillman Chan from Citigroup. Please go ahead.

Hillman Chan -- Citigroup Research -- Analyst

Good evening, management. Thank you for taking my question. My first question is about the sales and marketing strategy, and could you shed more color on these and the budget related to that for 2018, including the policy with Baidu Total and that? Secondly, how do we see the competition from Dong Hse Di [sic] so far? Have we seen any impact on our OEM ads and Dealer Subscription business so far? Lastly, for our second-quarter revenue guidance, could you give some granularity within the guidance on our media business, and also the transaction business as well? What is the profit from Bitauto excluding Yixin in the first quarter, please? Thank you.

Andy Xuan Zhang -- Chief Executive Officer and Director

I'll answer the first two. I think OEM really -- their sales and marketing really pretty much based on the sales forecast. There are OEMs who are enjoying very high growth of sales, typically people like Geely, in the first five months, and they're also who's actually taking a significant hit as well on the sales -- some of the joint venture brands. I think the overall market growing in terms of auto sales is on the passenger car side. I think it was about 5.9% for the first five months, but for the whole year, I think it will be somewhere around 5%. So, I'll say it's a normal year for us in the business.

Also, what we have witnessed is the new energy vehicle companies -- the rise of them. I think the first five months of sales have been very encouraging, and obviously, the central government, local government all are encouraging the sales of the energy vehicles. So, I think we actually see that would be one of our key growth strategies moving forward from the OEM standpoint. There are rumors saying that we're actually looking at over 1 million new energy cars sold in the year of 2018, given that they've already seen a very high number for the first five months. So, this is one of the segments that we're focusing, and me and my team are really looking into that, and hopefully, we'll be benefiting from that growth in the second half of the year as well as moving to the next few years.

Competition-wise, again, we've never seen less. It's always there. But, I think the key for Total and their subsidiary is whether or not to convince the advertisers to spend double the amount of money on both different apps. Meanwhile, the overlaps of consumers are quite high. So, either you bought additional eyeballs, or you bought additional time, or you just want to spend on one thing. So, again, so far, I think a lot of the OEMs are still viewing that as a general portal kind of competitor versus the pure vertical, but I think this is definitely something that we're paying very high attention to if there will be a significant move from that end of the business. So, you want to answer the third one?

Cynthia He -- Chief Financial Officer

All right. So, I will talk a little bit about the questions you asked regarding second-quarter revenue guidance as well as first-quarter revenue breakdown. For the second-quarter revenue guidance that we have given, we take into consideration three business segments, namely Advertising and Subscription, Transaction Services business, and CIG. So, for the media business, our second-quarter guidance is in line with our full-year guidance of around mid-teens, but when we do give out our quarterly guidance, we remain cautious and prudent, so this guidance is slightly less than mid-teen level.

In terms of the Transaction revenue business guidance, which is very similar to Yixin's total revenue because Yixin is the primary operator of our Transaction Services, for the second quarter, we're assuming somewhere around a 53% to 55% increase, and the rest -- the differential left would be our Digital Marketing business. The Digital Marketing business in the whole year of 2018 should grow above 20% year over year. However, because it is an agency business that is subject to large customer concentration risk, from quarter to quarter, the fluctuation may be bigger than the other revenue segments, but it's reasonable to assume for the full year, revenues from Digital Marketing Services will be above 20%. In terms of the first-quarter revenue breakdown, as we have --

Hillman Chan -- Citigroup Research -- Analyst

Sorry, the net profit -- I meant to ask -- net profit from the auto excluding Yixin?

Cynthia He -- Chief Financial Officer

Oh, in terms -- we don't break down the profit between the three different business lines. The disclosure we've made is for the whole as a group, and this is the current disclosure we can give for now.

Hillman Chan -- Citigroup Research -- Analyst

Okay, thank you very much, Andy and Cynthia, and I wish you all the best in the future.

Operator

Thank you for the questions. Next question comes from the line of Wendy Huang from Macquarie. Please ask your question.

Wendy Huang -- Macquarie Group -- Managing Director

Thank you. Just wanted to get some clarity on the historical disclosures. So, in the previous Yixin call, you mentioned that the self-financed transaction volume in Q1 was 110,000 versus 150,000 in first half last year. If I look at the first half last year disclosed data, I add up Q1 and Q2 that that actually amounted to 244,000, so obviously, that's not an apples-to-apples comparison. So, I just wonder if you can give our apple-to-apples comparison data for the first-quarter transaction number. That's the first question.

Second question -- you disclosed a credit loss figure -- the RMB149 million -- in the press release. I just wonder how should we translate this credit loss number into a bad debt ratio? Is there a self-financed loan amount for 2017 that you can disclose? And also, for your balance sheets -- so, is it right to say that your total loan balance as of now is about $10 billion USD? If I add up your financial receivables and also total borrowings, should I consider that as the total loan balance as of March? That's just some granularity questions that I wanted to get more color.

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

Let me clarify Yixin's transaction volume. So, we disclosed that in the first quarter of 2018, our financed transactions were over 110,000. So, financed transactions include our loan facilitation and self-operating financing business. This is not equivalent to the total transactions because from total transactions, there is some finance penetration rate. So, if you compare 110,000, if you look at our issuance in the first half of the filings, the financed transactions for the first six months of 2017 was 140,000, but this is six months. Currently, we are disclosing three-month numbers. So, that's one clarification.

Wendy Huang -- Macquarie Group -- Managing Director

Actually, my question -- sorry to interrupt -- I understand that, but I want to get a sense about total transactions in Q1.

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

In 2018, for Yixin total trans -- because I think when you are referring to the total transaction number last year... Let me clarify a few things. I believe last year, in Bitauto's transaction volume, they also disclosed the transaction volume in their Transaction Services, which includes Yixin and some other non-Yixin business. And, for Yixin, we didn't particularly disclose the total transactions for Q1 because due to our investments into Yusheng, we would actually be focused on the financed transactions instead of total transactions. Our total transactions are bigger than financed transactions. We think from this point on, we don't really want to focus on total transactions. Instead, we will focus on the financed transactions.

Wendy Huang -- Macquarie Group -- Managing Director

Okay, thank you. And, how about the credit loss?

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

For the bad debt ratio, I think one good ratio you can look at is at our 30-day-plus past due ratio, 90-day-plus past due ratio, and 180-day past due ratio, which is 1.45%, 0.93%, and 0.39%. We also disclosed this number compared to December 31st last year, so we think that you can see that the 30-day past due ratio was 1.48%, so it kind of stabilized in the first quarter -- actually, slightly decreased -- and then, the 90-day past due ratio...

Wendy Huang -- Macquarie Group -- Managing Director

Sure, I understand that, but I just want to get a sense about the credit loss expense that will be picked up on the P&L. That number was RMB179 million in Q1, right?

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

Yes. Under that --

Wendy Huang -- Macquarie Group -- Managing Director

Actually, I want to get a sense -- hmm?

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

Please go ahead.

Wendy Huang -- Macquarie Group -- Managing Director

Maybe let me rephrase this question. If you can give us color about the credit loss expense that would be picked up for the whole year 2018 based on the past due ratio you just mentioned.

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

Let me clarify the first quarter first. Under the first quarter, due to the GAAP differences -- so, under the U.S. GAAP, there is RMB179 million that would be picked up on our balance sheet for the provision, and under IFRS, there would be roughly approximately RMB130 million that would be picked up on the P&L. So, that's the first quarter, and I think for the whole year, I think our estimate is similar to what we have committed before. You can also roughly estimate on using the balance of the provision as a percentage of the total financed receivable percentage to collate. But, I think roughly, just in summary, it should be following the range that we committed previously.

Wendy Huang -- Macquarie Group -- Managing Director

I see. How about the total loan balance as of March?

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

The total loan balance -- let me talk about Yixin first. Total borrowings for Yixin including bad borrowings and asset-backed securities is about RMB28 billion.

Wendy Huang -- Macquarie Group -- Managing Director

Sure. I see that number in the press release, but there is also a financial receivable item, right?

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

The financed receivable is our assets, and then -- so, basically, financed receivable is our asset. To finance the financed receivables, we can either use our cash or use our total borrowings. So, roughly, you can see total financed receivables were equal to our cash plus total borrowing.

Wendy Huang -- Macquarie Group -- Managing Director

The total loan balance -- that includes both self-financed loans, as well as the bank borrowing loan, as well as the asset-backed securitized loan, right? Is my understanding correct?

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

I think you probably -- "total financed receivables" means the money that we lent to consumers. So, this is assets on our balance sheet. "Total borrowings" means the money we borrow from the bank or financial institutions or through the asset-backed securitizations. This is the liability on our balance sheet.

Wendy Huang -- Macquarie Group -- Managing Director

Sure. Or, maybe you can just give me a simple answer about the total loan balance.

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

It is the total loan -- financed receivable balance is RMB33.8 billion.

Wendy Huang -- Macquarie Group -- Managing Director

Okay, thanks.

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

This is the number that you are referring to because we are doing financial lease, so the money that we lend to consumers is not called a loan, it's called financed receivables.

Wendy Huang -- Macquarie Group -- Managing Director

Thank you.

Operator

Thank you for the questions. We are now approaching the end of the conference call. I will now turn the call over to Bitauto CFO Cynthia He for closing remarks.

Cynthia He -- Chief Financial Officer

Once again, thank you for joining us today. Please don't hesitate to contact us if you have any further questions. Thank you, everyone.

Operator

Thank you for your participation in today's conference. This concludes the presentation. You may now disconnect. Good day.

Duration: 49 minutes

Call participants:

Andy Xuan Zhang -- Chief Executive Officer and Director

Cynthia He -- Chief Financial Officer

Catherine Xiaozheng Liu -- Chief Financial Officer, Yixin

Binbin Ding -- JPMorgan -- Analyst

Monica Chen -- Credit Suisse -- Analyst

Liping Zhao -- China International Capital Corporation Limited -- Analyst

Hillman Chan -- Citigroup Research -- Analyst

Wendy Huang -- Macquarie Group -- Managing Director

More BITA analysis

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