Here Group Limited

Good morning and good evening, ladies and gentlemen. Thank you for standing by and welcome to Qantas Inc's earnings conference call. At this time, all participants are in a listen-only mode. We will be hosting a question and answer session after management's prepared remarks. Please note that today's event is being recorded. I would now like to turn the conference over to Ms. Leah Guo, Investor Relations Associate Director of the company. Please go ahead, ma'am.

Thank you. Hello, everyone, and welcome to QantasLink's earnings call for the first quarter of fiscal year 2025. With us today are Mr. Peng Li, our founder, chairman, and CEO, and Mr. Tim Xie, our CFO. Mr. Li will provide a business overview for the quarter, then Tim will discuss the financials in more detail. Following their prepared remarks, Mr. Li and Tim will be available for the QA session. I will translate for Mr. Li. You can refer to our quarterly financial results on our IR website at ir.quantasync.com. You can also access a replay of this call on our IR website when it becomes available a few hours after its conclusion. Before we continue, I would like to refer you to our Safe Harbor Statement in our earnings press release, which also applies to this call. As we will be making follow-looking statements, please note that all numbers stated in the following management prepaid remarks are in RMB terms and we will discuss non-GAAP measures today, which are more thoroughly explained and reconciled to the most comparable measures reported in our earnings release and filings with the SEC. I will now turn the call over to the CEO and founder of Quantasync, Mr. Li.

Good morning, everyone. Thank you for joining us today for our first quarter fiscal year 2025 earnings call. Our journey over this past year has been purposeful and strategic. We are actively reshaping our company to serve China's rapidly growing silver economy. The numbers tell a compelling story. In Beijing alone, we now have nearly 5 million people over 60, with that number growing by 0.3 million just last year. This is why our work is significant. We are shifting our focus from broad market reach to building lasting relationships with our civil economy customers. You can see this in our new food and medicine products, which we are successfully promoting to our existing online learning users by leveraging our integrations with them. We are also in the early stages of exploring offline service center opportunities to further enhance our user experience. Now let's take a look at this quarter. Our revenue this quarter reflects our planned strategic transition, which includes an anticipated decline as we pivot towards opportunities in the silver economy. Importantly, we maintained healthy profitability during this period, showing our ability to navigate this transition while safeguarding shareholders' value. We are uniquely positioned to serve China's silver economy. It has expanded beyond basic elderly care to include a wide area of lifestyle, wellness, and enrichment services. Our strength lies in our established user base. These are individuals who are either in this demographic or approaching it. These users trust us as their learning service provider, and we are attuned to their involving involving needs and performance preferences. Let me elaborate on the three key aspects of our business transformations. First, we are evolving our revenue model by expanding how we serve our users. Our deep understanding of our users' needs has revealed opportunities beyond online learning service courses. They are seeking integrated solutions for health, wellness, and personal enrichment. In response, we are developing products and services that create more lasting value for them, including our food and medicine product line. This product line is uniquely integrated with our online learning service platform. Our traditional Chinese medicine courses teach users about the principles behind these wellness products, while our nutrition experts provide practical guidance on incorporating them into daily health routines. This know-how, foundations, As this know-how foundation helps our users understand not just what products to use, but why and how to use them effectively for their personal wellness goals. Let me share a concrete example that illustrates how we are serving our users more comprehensively. One of our 70-year-old users began her journey with us through our online courses. Today, she engaged with our platform in multiple ways, following our traditional Chinese wellness courses, including Ba Duan Jin, a series of gentle exercises rooted in traditional Chinese medicine. and using our health products daily. Through our courses, she has gained practical knowledge about the 24 solar terms, the traditional Chinese calendar that gets seasonal living patterns, and applies this wisdom to her daily health routines. Now she follows a consistent schedule, practicing our signature exercises at 7 a.m. each morning and has learned to adapt her wellness practices according to her body's needs. Her experience demonstrates how our educational foundation naturally extends into broader lifestyle and wellness solutions. We are strategically transforming our business mix to focus on the silver economy while building a comprehensive ecosystem. We are gradually reducing our non-silver economy related businesses while expanding services that resonate with our core demographic needs. Our approach combines the convenience of online engagement with meaningful offline experiences. Our recent initiatives in Beijing showcase this strategy in action. In October, we helped to organize the Beijing Community Elderly Home Care, Autumn Family Carnival Beijing's Fengtai District. This event brought together over 50 service providers across five essential aspects of senior living, medical care, food, housing, transportation, and entertainment. The event featured interactive demonstrates of traditional wellness practices. calligraphy sessions and consultations about our study tours to culturally significant locations such as Qingcheng Mountain, a historic Taoist site, and Jingdezhen, China's porcelain capital. This community engagement has strengthened our customer relationships significantly. Users who participate in our offline activities show higher engagement with our online courses. We see increased retention rates and stronger brand loyalty from these users. They also tend to explore more of our products and services. validating our integrated approach to serving the silver economy market. Third, we maintain a clear focus on sustainable profitability throughout this transition. In our initial approach to offline expansion, we aim to start with a pilot program in Beijing's six urban districts. collaborating with existing community centers to test and refine our operational model. Once we validate this approach, we plan to expand our coverage across the city, and we will evaluate various expansion models based on the learnings from our pilot program. This measured approach allow us to optimize our operational model while maintaining profitability during the transition period. As we transition from a traffic-driven business model to one that is more product-oriented, we expect to see a gradual improvement in our sales and marketing costs. This shift allows us to better allocate our resources. We are concentrating our efforts on initiatives that directly support the zero economy. At the same time, we are gradually scaling back investments in areas that are not central to our mission. This disciplined approach to cost management, combined with our focus on building partnerships, enables to maintain healthy profit margins. It also positions us well to invest in growth initiatives that align with our long-term vision. This focus on efficiency and profitability is reflected in our strong financial position. As of September 30, 2024, we held cash and cash equivalence restricted cash and short-term investments totaling RMB 1,193.7 million, up from RMB 1,026.3 million. at the end of June. Our business continues to generate positive cash flow from operations during this transition period. This solid cash position has allowed us to share our success with shareholders through a special dividend announced in October. It demonstrates not only our robust financial health, but also our commitment to investing in our silver economy strategy while rewarding our shareholders. Looking ahead, we remain focused on realizing the significant opportunity in China's silver economy. More importantly, we are building sustainable competitive advantages by creating comprehensive solutions for the silver economy market. According to our 2024 senior investor-based learning industry development report, over 80% of the silver population is already engaged in investor-based learning, with an additional 66% expressing interest in drawing such activities. This validates our strategy of building upon our educational foundation to provide broader lifestyle and wellness solutions. The silver economy in China represents more than a business opportunity. It's a chance to create meaningful impact as China's population ages. Our existing relationships with users, combined with our understanding of their needs, position us uniquely to serve this growing market. While this strategic transition may impact near-term revenue, we are confident that our focus on the civil economy, supported by our user relationships and operational capabilities, positions as well for long-term value creation. We are building not just a business, but a comprehensive ecosystem that enriches the lives of China's fewer population. Now I will hand over to Tim, our CFO, who will provide more details on our financial performance. Tim, please go ahead.