51Talk Online Education Group

Ladies and gentlemen, thank you for standing by for China Online Education Group's fourth quarter and full year 2020 earnings conference call. At this time, all participants will be in listen-only mode. After management's prepared remarks, there will be a question and answer session. Today's conference call is being recorded. I will now like to turn the call over to your host, Ms. Judy Piao. investor relations for the company. Please go ahead, Judy.

Thank you. Hello, everyone, and welcome to the fourth quarter and full year 2020 earnings conference call of China Online Education Group, also known as Taiwan Talk. The company's results were issued by Newswire Services earlier today and are posted online. You can download the earnings press release and sign up for the company's distribution list by visiting the IR section of its website at ir.51talk.com. Mr. Jack Huang, our Chief Executive Officer, and Mr. Min Xu, our CFO, will begin with some prepared remarks. Following the prepared remarks, Mr. Li Min Zhang, our Chief Operating Officer, will also join the call. for our Q&A session. Before we continue, please note that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's results may be materially different from the views expressed today. Further information regarding this and other risks and uncertainties is included in the company's form 20F and other public filings as filed with the U.S. Securities and Exchange Commission. The company does not assume any obligation to update any forward-looking statements except as required under applicable law. Please also note that 5.1 talks, earnings press release, and this conference call include discussions of unaudited gap financial information as well as unaudited non-gap financial measures. 5.1 talks press release contains a reconciliation of the unaudited non-gap measures to the unaudited most directly comparable gap measures. I will now turn the call over to our CEO, Jack Huang, please go ahead.

Hello, everyone. Thank you for joining our conference. The growth momentum from the beginning of 2020 continued into the fourth quarter, reflecting solid strategic execution in our online K-12 English mass market offerings. Fourth quarter net revenues grew 34.7% year-over-year to reach 535.1 million RMB. We also recorded historically high operating cash flow of 188.5 million RMB. In addition, the number of new paying students grew over 70% year-over-year to boosted by our effective curriculum and improving service quality, while our active students reached 353,800, up 37.6% compared with the same period in 2019. Although 2020 presented an array of unforeseen challenges, Our strong pre-established foundational groundwork allowed us to not only manage this two-meters period, but in fact benefit from the shifting environment as we took advantage of new opportunities. Full-year net revenues grew 38.9% to 2.1%. 2020 operating cash flow rose 80.8% to reach a historical high of 719.3 million RMB, compared with 397.9 million RMB in 2019, further strengthening our financial position for future growth. We also witnessed remarkable growth in new paying students, which increased 60% year over year. We are also very excited about our recent acquisition of GKIDS product portfolio and industry-leading AI technologies. GKIDS offers innovative AI-driven online English courses through highly interactive animation and picture books for children. With product offerings intended for those between the ages of 3 and 8, this acquisition both extends our adjustable market and broadens our product and curriculum portfolio. We foresee many potential collaboration and integration opportunities between our platform and G-Kids products and industry-leading AI technologies. leading to both new products and product improvements, which will better serve our customers. As we head further into 2021, we are focusing on user growth and enhanced brand promotions to advance market share expansion. To better attract and retain users, we will continue optimizing learning experiences through upgraded product offerings and an enriched curriculum mix. We are launching innovative AI-powered robotic tutors to help students learn core knowledge points with the aim of enhancing overall learning efficiency. To make our courses more interesting and engaging to young children, We are also integrating more interactive features into our textbooks. Additionally, we are expanding our curriculum portfolio in order to provide a holistic learning experiences through investing in R&D, upgrading our services to students, and expanding our teacher operations. Finally, we target to further increase our branding and marketing efforts to heighten brand awareness as we enter the next phase of growth. We are also pleased to have successfully provided over 15 million one-on-one online English lessons, including free trials, between November 2019 and December 2020. A rapid increase that took our cumulative offerings since our inception in 2011 to more than $150 million and a strong testament to our accelerating growth trajectory. As Five One Talk continues to grow, we are confident our balanced growth strategy will continue to yield solid value for our stakeholders. With that, I will now turn the call over to Ximing.