Secoo Holding Limited

us today to our Q1 2024 results and business update presentation. Our speakers will be Massimo Mauri, our CEO, and Lorenzo Mazzini, our CFO. But we are pleased to also introduce Clarence Naan as our new Head of Corporate Development and Investor Relations. Allow me to express my gratitude for the past years serving as Interim HR It has been a pleasure collaborating with all of you and I'm excited to continue working alongside Max and now also Clarence to further develop our equity store. And we remain, of course, part of the team. So please feel free to reach out to me for any of your needs. Clarence, the floor is yours.

Thank you very much, Lorenzo, for the introduction. So indeed this week I've joined SECO as head of corporate development and head of IR. We view this as a very synergetic role within the company. Before that I spent 15 years on the sell side and actually I know many of you and had often the opportunity to work with SECO over the recent years. So it's a company I know very well. I'll take the time to reach out to all of you individually in the coming weeks. But today it's all about SECO and it's my pleasure to hand over to our CEO, Max Mari, who will update us on the Q1 performance.

Thank you Clarence, good afternoon and thank you all for joining. So, as expected, the first quarter recorded a slight decrease in in the top line. But what is important in my view is the positive evolution on the revenue mix and margin. This is a further demonstration of our winning strategy to evolve towards a balanced business model across hardware and software, thanks to the growth potential of CLIA. It's strange, but I'm not able to, okay, now we are perfect. I think the unique positioning allow us to weather the current environment in our segment better than the most of our main competitor. And this is true across all the metrics. To illustrate my point, while we manage to limit our revenue decline to 14% on quarter-on-quarter, players like Advantech and Adelink suffered more than us, with a drop in between 20 and 30% of the revenue. If we focus on our margin for a moment. Thank you to our software business growing by 14% at the 7.3 million. We gained 845 basis point and reaching 56% in the gross profit margin. This is very important for tourism. The first because we were able to keep our ABTDA margin at the 22% was offsetting the pressure on revenue. And second, and even more important, I would say we fixed the cost representing over 75 of our OPEX, our P&L enjoy a significant operating leverage. While we did not benefit from this effort in Q1 with the positive contribution of the GPM being absorbed by a lower revenue, we expect that any further uptick in the top line will go directly on our ABTDA growth. To conclude this summary, I want to reiterate that the decrease in revenue was largely expected. In fact, we fully anticipated the softness in Kuwan due to the tail effect of the stocking. I want to guide you also more across into the 2024 results where we still committed to deliver a strong performance for the 2024 and behind. And I can say that the second half will be slightly better in terms of revenue. And we are expecting the growth returning back stronger in the second half of the year. It will give us more fuel to work with also in terms of margin, as I said. Well, in terms of 2025, we are also building a stronger design win and pipeline. And as you know, in our business, it's very important to win customers now to be ready to enter into mass production in the 2025. But to illustrate this kind of progress, I will mention two of our recent win. The first one, we won a contract with Grundfos, a Danish company and a worldwide leader in water solution for a new custom solution for one of the three, their main product. It will drive us 6 million in additional and new revenue for the 2025 and really a lot of years attached. The second one is an agreement that we signed with CAREL, which is public, that will give us additional 5 million euro in revenue across the 2020 it will take a portion of it and at the full speed in 2026. So these are just two example to say that we are gaining new customers. We are gaining project with the existing customers. And so we are creating for Seco a very good situation for the 2025. So I think that's basically all in terms of update from my side on the quarter. I now hand over to Lorenzo to deep dive more in deeper on the financial results.