Quhuo Limited

Ladies and gentlemen, welcome to Q4 third quarter 2020 earnings conference call. At this time, all participants are in a listen-only mode. After management's prepared remarks, there will be a question and answer session. Today's conference call is being recorded. If you have any objections, you may disconnect now. I'd now like to turn the conference over to your host for today's conference call, Anderson, investor relations director of Chihuahua. Please go ahead.

Thank you. Thank you, operator. Hi, hello, everyone. Welcome to Chihuahua's third quarter 2020 earning conference call. The company's results were released earlier today and are available on our IR website. On the call today, Leslie Yu, chairman of CEO, co-founder Barry Ban, and CFO Sandra Zee, Lastly, we will review business operations and company highlights, followed by Sandra Zee, who will discuss financial and guidance. They will both be available to answer your questions during the Q&A session that follows. Before we begin, I would like to remind you this call may contain forward-looking statements. May enter the Safe Harbor Provision of Private Security Legislation form, Act of 1995. Such statements are based on management's current expectations and the current market and operating conditions and related to events that involve known or unknown risks, uncertainties, and other factors, all of which are difficult to predict and many of which are beyond the company's control, which may cause the company's actual results, performance, or achievements to differ material from those in the forward-looking statements. For the information regarding this and other risks, uncertainties, and factors, it includes in the company's filing with U.S. Security and Exchange Commission. The company doesn't undertake any obligation to update any forward-looking statements as a result of new information, future events, or otherwise, except as required under law. With that, I will now turn the call over to our chairman and CEO, Mr. Leslie, Please go ahead.

Thank you, Ania, and thank you all for joining our third quarter 2020 earning course. During the third quarter, despite the ongoing impact of COVID-19, we are very pleased to report a significant improvement in our bottom line. We achieved further growth on revenue, gross profit, and net income. Along with the rapid growth of revenues and sales coverage, our adjusted net income reached 61 million RMB, which is more than four times the increase year-over-year, and a new record high since our inception. There are three major drivers behind this number. Firstly, thanks to our unique and refined management system, Q4+. which enabled us to maintain both rapid growth and stronger profitability than our peers, even in the rapidly changing COVID-19 microenvironment. Relying on the Q4plus Management System, we easily expand our management team to cover more business areas without adding more people. Relying on the Q4plus Management System, we are able to manage 1,000 business circles, like one circle, and take care of 50,000 workers, like one worker. The system's efficiency and effectiveness contribute to the 3% gross profit increase and more than four times net income increase year over year. Secondly, thanks for the seven years accumulated labor pool, we continued to maintain our competitive advantage in recruiting workers at lower cost compared to many peers. While many of our peers are facing the challenge of labor shortage in China, our online internal referral system with our 180,000 talent pool easily supplies the workforce for our further expansion and support our rapid growth. which also contributes to the 3% gross profit increase and more than four times net income increase year-over-year. Third, thanks for leveraging the on-ground infrastructure, large-scale workforce pool, and scalable, modulable management system, we are able to access and fast-expand more localized life service sectors with very few resource investments. During the third quarter, we nearly have no further investment to gain 2.5 million orders new revenue growth increase in fresh and grocery sector, which is about six times increase compared with second quarter, which also contributes to our 3% growth profit increase and more than four times net income increase. During the third quarter, we keep exploring the business opportunities in localized live service markets and duplicate our proven business capabilities from food delivery sector to other localized service sector. In October, we applied a majority stake in LanLan Information, which is a leading gig economy platform that specializes in housekeeping solutions for hotels and B&Bs in China. Leveraging our on-ground infrastructure, workforce flow, and the management system, we further expanded our housekeeping service coverage to 22 cities in China and provided services for over 1,900 B&Bs and 1,200 hotels. We have very positive expectation to have very solid operational and financial performance for the fourth quarter in the housekeeping solution sector. We are on the road with concrete and specific target to become the leading gig economy platform of localized life service sectors, including the food service, transportation service, housekeeping solution, and healthcare solution service. So that concludes my prepared remarks. I will now turn the call over to our speaker, Sandra, who will discuss our key financial results this quarter. Thank you.