ATA Creativity Global

Global fourth quarter and year end 2024 financial results. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Alice Zhang with the Equity Group. Thank you. You may begin.

Thank you, Operator. Good morning to all of you joining us from China, and good evening to all of you joining us from the United States. Please be advised that the discussion on today's call may include forward-looking statements. Such forward-looking statements involve certain risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. Please refer to the company's most recent SEC filings for a more complete description of risk factors that could affect these projections and assumptions. The company assumes no obligation to update forwarding statements as a result of new information, future events, or otherwise. Regarding the disclaimer language, I would also like to refer you to slide two of the conference call presentation, which is accessible via the IR section of ACG's website. A simultaneous audio webcast is also accessible via the IR section of ACG's website, including the replay, which will be available for the next 90 days. ACG's chairman and CEO, Mr. Kevin Ma, will start this call highlighting the company's fourth quarter and four-year key operational and financial achievements. CFO, Mr. Robai Sima, will provide an overview of financial and operating results for fourth quarter and year in 2024 and briefly discuss 2025 four-year guidance. President, Mr. Jun Zhang, will conclude the prepared remarks with an update on the company's long-term growth strategy before opening the floor for questions. For those of you following the accompanying slide presentation, please refer to the slides for further details. With that, I'll turn the call over to ACG's Chairman and CEO, Mr. Kevin Ma. Please go ahead, Mr. Ma.

Thank you, Alice. Welcome everyone to Lucy America. We appreciate everyone's time. As Alice mentioned, please refer to our early stage available on the RR site of our website. as we go through our prepared remarks. During 2024, with the mission of driving positive student outcomes in mind, ACG continued to concentrate on making college educational services available to our students. Our investment in the teaching team allowed us to introduce related and customized offerings, and our efforts to expand and maintain institutional partnerships expanded their access to world-class educational resources. We also actively explored new ways to improve overall operations efficiencies, from streaming operations and locating regional resources to initiate the integration of AI technologies into our services, which we believe will continue to drive long-term value to our operations. The fourth quarter of 2024 was highlighted by significant growth in net revenues and bottom-line results. We reported more than 20% increase in net revenues, driving a similar level of improvement in our gross profit. For federal training programs, credit dollars delivered to ACH students increased by over 35% during the fourth quarter of 2024. As a result of increased revenues, net income attributable to ACH growth by to revenue of 13.3 million. Similarly, for the full year 2024, we reported strong net revenue growth of 21%, exceeding the high end of our full year values, which resulted in a 23.2% increase in growth and our core business portfolio training service recorded a significant increase in student elements as well as creating our deliveries. Moving on to fourth quarter operation highlights, portfolio training service accounted for the majority of our revenues for the quarter, with project-based programs contributing to 66.8% of total credit now are delivered. The demand for our portfolio training service demand is strong and we were pleased that we have been able to address this demand with a teaching team that students trust. We organized small group classes which allowed more students to take lessons for popular teachers has increased creating hours delivered with enhancing teaching efficiencies at the same time. Revenues from rich-based learning, overseas study, counseling, and other educational services all increased by more than 40%. The hosted October session of the United Nations September Development Goals Arts Bootcamp. our Shanghai Fashion Week program, and several master classes covering arts topics like character, animation, visual communication, and interior design. As we enter the 2025 application season and many of our students have submitted to the application portfolio to overseas schools, we are glad to share that our So far, our students have received offers and scholarships from schools such as Cornell University, Columbia University, Rhode Island School of Design in the United States, and the University of the Arts London, University College London in the UK, as well as prestigious art schools in Japan, Hong Kong, and Australia. At the same time, we continue to expand our partnership base. and we began providing educational service to two additional higher education institutions, the Central Academy of Drama and the Nanjing University of Art. During the quarter, we made this strategic decision to discontinue our junior art service, aiming to increase the overall efficiency of our operations, which contributed to a larger and they expect during the quarter. With that, I will hand over the call to Sumar for the overview of our financial and operating results for fourth quarter of the full year 2024 and provide some call-out on our guidance for fiscal year 2025.