Dingdong (Cayman) Ltd ADR

Good morning and good evening, ladies and gentlemen. Thank you for standing by, and welcome to the Ding Dong Limited Third Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. Please note that this event is being recorded. I would now like to turn the current server to the first speaker today, Nicky Jang, Director of Investor Relations. Please go ahead, sir.

Thank you. Hello, everyone, and welcome to Ding Dong's Third Quarter 2024 Earnings Call. With me today are Mr. Changlin Liang, our founder and CEO, and Mr. Song Wang, our CFO. You can refer to our Third Quarter 2024 financial results on our IR website at IR.100ME. You can also access a replay of this call on our IR website when it becomes available a few hours after its conclusion. For today's call, management will go through their prepared remarks, which will be followed by a question and answer session. Before we continue, I would like to refer you to our safe harbor statement in your earnings press release, which also applies to this call. As we will be making forward-looking statements, please note that all numbers stated in the following management prepared 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 press release and filings with the SEC. I will now turn the call to our first speaker today, the founder and the CEO of Dingdong, Mr. Liang.

Okay. Thank you, investors. Dear analysts, dear friends of Dingdong Grocery, welcome to the Q3 financial analysis meeting of Dingdong Grocery in 2024. Since Q3 2024, Dingdong Grocery has achieved profit under the standard of non-GAAP for eight consecutive seasons, and has achieved profit under the standard of GAAP for three consecutive seasons. Thank you for joining Dingdong Earnings Call for Q3 2024.

I'm pleased to report that we achieved non-GAAP profitability for the eighth consecutive quarter and GAAP profitability for the third consecutive quarter. Revenue also increased on a year-over-year basis for three straight quarters. Both GMV and net profit also reached new quarterly highs. The key factors driving this progress include the ongoing optimization of our fresh grocery supply chain and the increased concentration of frontline fulfillment stations in our existing markets. These enhancements enable us to deliver better products and services to new and existing customers. This, in turn, supports sustainable growth in the scale and profitability of our business.

First, I'll present our Q3 2024 performance.

followed by an analysis of our operating data, and conclude with a brief outlook on future development and performance.

In Q3 of 2024, Dingdong Grocery achieved a GDP of 72.2 billion yuan, a 28.3% growth rate, a revenue of 65.4 billion yuan, a 27.2% growth rate. Under the Lung Gap standard, the net profit was 1.6 billion yuan, a 9-fold increase, a 2.5% net profit, and a 2.2% increase. Under the Gap standard, the net profit was 1.33 billion yuan, a 62-fold increase, a 2.0% net profit,

In Q3 2024, we generated GMV of 7.27 billion RMB, a 28.3% year-over-year increase, with revenue reaching 6.54 billion RMB, an increase of 27.2% year-over-year. Non-GAAP net profit was 160 million RMB, an increase of over nine times from the same period last year. with non-GAAP net profit margin coming in at 2.5%, an increase of 2.2 percentage points year over year. GAAP net profit was 133 million RMB, an increase of more than 62 times from the same period last year, with a GAAP net profit margin of 2%, up 2 percentage points year over year.

The rapid growth of the industry is mainly due to the rapid increase in user size and user up value, as well as the increase in penetration rate in the existing area. In terms of user size, Q3月均下单用户数约822万,同比提升了24.5%,用户在电动买菜的消费钱包份额进一步提升,Q3用户月均up值较去年同期提升了6.4%,其中 Q3 Q3 This figure represents that our user group is getting better and better in terms of size and quality. High flow, high review, is also the main driving factor of our business.

This rapid growth was primarily attributable to the growing scale of our user base, increases in ARPU, and higher use of penetration rate in our existing markets. Average number of active transacting users reached approximately 8.22 million, a 24.5% year-over-year increase. Our wallet share per customer also continued to grow during the quarter, with average monthly ARPU increasing 6.4%, an average monthly ARPU for a member increasing 8.8% year-over-year to 540 RMB. As our user base rapidly expands, user stickiness is also on the rise. Users place an average of 4.4 orders per month, reflecting a year-over-year increase of 6.1%. This average was higher among members with 7.6 orders per month, reflecting a year-over-year increase of 9.8%. Furthermore, retention rates among new users are strengthening, with a 12-month retention rate of 57.3% for transacting members. These metrics not only indicate that our user base is growing in number, its quality is also improving. High retention rates and frequent repurchases are also key factors driving our business forward.

Geographically, Jiangsu, Zhejiang, and Shanghai continue to be the primary growth drivers. Shanghai's GMV increased by 24.5% year-over-year during the quarter,

while Jiangsu and Zhejiang increased by approximately 40% each. In Shanghai, average daily order volume processed per fulfillment station was nearly 1,700 orders, with both Jiangsu and Zhejiang processing more than 1,000 orders. 以上的增长主要受益于 第一,持续优化江州后区域的前置舱布局 接着Q3末已完成新开80个前置舱 其中第三个季度新开40个前置舱

We will continue to improve our delivery efficiency and optimize delivery costs, which will be a good basis for our growth in size in 2025.

The growth mentioned above was primarily driven by the following factors. We continue to refine our network of frontline fulfillment stations in Jiangsu, Zhejiang and Shanghai. By the end of Q3, we successfully hit our target of opening 80 new frontline fulfillment stations in these regions this year, with over 40 opening in the third quarter alone. Average daily order volume for these new stations steadily ramped up to 866 orders during the quarter. Looking ahead, we're increasing our target for new fulfillment stations openings in 2024 to approximately 110. This strategy will enhance our presence in these key areas, improve our fulfillment efficiency and processes, reduce delivery costs, and establish a solid foundation to further expand our scale next year.

Thank you. With the advantage of Shanghai's high-end fresh product supply capacity in the Jiangzhe area, especially the shortage of tea-based products such as Xiu Bai and Ru Ying, the company's good product capability development in the Jiangzhe area and the ability of users to operate in Shenzhou are greatly improved. In the third quarter, the company achieved a annual growth of more than 50% of J&V in 13 cities in the Jiangzhe area.

Our robust fresh grocery supply chain capabilities in Shanghai have now expanded into Jiangsu and Zhejiang, allowing us to begin offering an expanded array of categories such as leisure products, dairy beverages, and coffee table top products. We've made significant progress in optimizing our operational capabilities with a focus on offering quality products and increasing user penetration in Jiangsu, Zhejiang, and Shanghai. Growth in GMV across 13 cities in these regions increased over 50% year-over-year during the quarter.

此外,北京和广深区域本季度GMA即使在年初闭店的影响下, 同比增长依然分别有14.6%和2.9%。 这两个区域在大幅度减亏的基础上实现了稳规模增长的目标。

Additionally, even under the impact of frontline fulfillment stations closure at the beginning of the year, GMV of the Beijing and Guangzhou Shenzhen regions increased by 14.6% and 2.9% year-over-year, respectively. We not only significantly reduced losses in these two regions, but also hit our goal of driving sustainable growth at scale.

The growth of the industry cannot be separated from the construction of good products. We continue to develop more delicious products, forming consumers' trust and dependence on Dingdong. We fully explore the needs of users in the two major scenes of table and tea festival, providing consumers with rich and differentiated good products. This year, we focused on 45 opportunities, such as fresh water, drinking water, sandwiches, drinks, ice cream, etc. In Q3, we effectively pulled the user's purchase of bottles and purchase techniques, contributing more than half of the large-scale GNV share growth. This also reflects the values we have insisted on since the first day of our business, never selling bad food to users. We have also been traveling to make beautiful ingredients as popular as自来水的使命和途中,

Our growth is closely linked to our growing array of high-quality products. We're committed to expanding our offerings to strengthen consumer trust and loyalty in our brand. By concentrating on two key scenarios, dining and coffee tables, we are gaining deeper insights into user needs, allowing us to cater to the demand for specific high-quality products. This year, we focused on 45 strategic categories with significant opportunities. such as fresh seafood, drinking water, sandwiches, beverages, and ice cream. These initiatives boosted both the frequency of purchases and total number of items per order in Q3, contributing to more than half of the year-over-year increase in total GMV. This achievement underscores the core value proposition we offer, no compromises on fresh grocery quality. We remain dedicated to our mission of making quality fresh groceries as accessible as tap water for everyone.

Finally, I would like to remind everyone about Q4 and the overall performance of Q4 and Q24. Referring to the current performance of the company, we have improved the performance forecast for the whole year. It is expected that this year and the fourth quarter, the net profit and scale will remain the same as before, and continue to achieve the profit of non-GAAP and GAAP口径. We are full of confidence in the rapid development of this year and future company business.

Lastly, let's turn to our outlook for Q4 and the full year of 2024. We're increasing our full-year targets based on our current performance. We expect non-GAAP and GAAP net profit and the overall scale of our business to continue growing significantly on a year-over-year basis next quarter and for the year. We're confident in the rapid development potential of our business throughout the remainder of the year and going forward.

我的发言到此结束,谢谢大家,下面请公司CFO王松来介绍一下公司财务情况。 This concludes my prepared remarks.

Thank you all for listening. I would like to turn the call over to our CFO Wang Song to go over our financials.

谢谢梁总,大家好,在向大家介绍我们的财务情况之前,先说明一下,我们的所有数字都是以人民币为单位的。 Thank you Mr. Liang, and hello everyone.

Before I review our financial performance for the third quarter, please note that all of our figures are in renminbi.

Before I review our financial performance for the third quarter, please note that all of our figures are in renminbi. Before I review our financial performance for the third quarter, please note that all of our figures are in renminbi. Q3, 进盈性现金流进流路4亿元,同比增长2.7亿元,这也是我们连续5个季度保持进盈性现金流进流路。

In Q3, we generated revenue of 6.54 billion RMB, a year-over-year increase of 27.2%. This significant growth also allowed us to achieve a new historic high in profitability with a non-GAAP net profit of 160 million, over nine times higher than the same period last year. Non-GAAP net profit margin was 2.5%, an increase of 2.2% from the same period last year. Gap net profit was 133 million RMB, an increase of 131 million RMB year-over-year, with net profit margin expanding 2 percentage points from the same period last year to 2%. Operating net cash inflow in Q3 reached 400 million RMB, an increase of 270 million RMB compared to the same period last year. This marks the fifth consecutive quarter of net cash inflow from operating activities.

The high growth of the Indian market is due to our determination and commitment. At the same time, it is also a positive reflection of our continuous development based on our supply chain capabilities. Next, let's take a look at Q3's specific financial situation. Q3's GNV is 72.7 billion yuan, which has increased by 28.3%. In addition to the situation mentioned above, we have 14 cities in the country that have received more than 50% of the same growth.

Our high-quality growth is fueled by our commitment to our original goals and mission and reflects our continued sustainable development of our business, anchored in our robust supply chain capabilities. Let's now go into further detail. GMV was 7.27 billion RMB, an increase of 28.3% year-over-year. Notably, we saw GMV grow by over 50% year-over-year in 14 cities nationwide, with Huzhou, Nantong, and Wenzhou in particular growing at rates that surpassed 70%. Q3毛利率为29.8%,同比降低了0.6个百分点。这是我们主动运营的结果。我们将商品供应链端优化的价值持续地回馈给消费者,寻求更高规模的增长。

At the same time, the improvement of our supply chain and operation efficiency has also brought us profit and faster growth. Although we only increased the width of the product supply, Q3's overall recovery rate was 10.7 days, and the same rate was also accelerated by 1.3 days. Benefiting from our ability to predict and operate in a smart way, and the cooperation and support of efficient operations between teams, we have further improved our supply chain and operation efficiency,

在维持损耗率稳定的情况下, 货品缺货率较去年同期降低了1.4个百分点。 Gross profit margin was 29.8%, a 0.6 percentage point decrease year over year, a result of our proactive operational strategy to pass along the benefits of our increasingly optimized supply chain to consumers as we scale. Moreover, enhancements made to our supply chain and operational efficiency have contributed accelerated growth in our bottom line. Although we cautiously expanded the breadth of offerings in our supply chain, we managed to optimize overall inventory turnover days to 10.7 days, 1.3 days less than the same period last year. Our ability to implement intelligent forecasting and operational scheduling system along with effective team collaboration has strengthened our supply chain management capabilities. We maintain While maintaining a stable loss rate, we have also reduced the out-of-stock rate of our top products by 1.4 percentage points compared to the same period last year. 同比提升了27.9%

Our fulfillment expense rate improved to 21.4%, a 1.8 percentage point decrease compared to the same period last year. With average order value, or AOV, remaining stable year-over-year, we achieved significant efficiency gains from an increase in average order volume per fulfillment station.

Our frontline fulfillment stations process over 1,100 orders daily in Q3, a year-over-year increase of 27.9%. Additionally, we enhance our service capabilities by deploying algorithms and optimizing supply chain operations. As a result, the proportion of orders delivered within 30 minutes in Q3 increased by 3.5 percentage points year-over-year.

Q3's sales efficiency is 2.2%. Our marketing expense rate was 2.2%, an increase of 0.2 percentage point compared to the same period last year. Alongside our ongoing efforts to optimize user acquisition,

and improve conversion rates, we continue to carefully manage marketing expenses. This strategy aims to drive user penetration in key regions while supporting overall growth in scale.

We will continue to invest in food, agricultural technology, and technical data algorithm.

As a proportion of total revenue, general and administrative and R&D expenses decreased by 0.9 percentage points compared to the same period last year. This was primarily attributable to greater economies of scale. As always, we remain committed to investing in food R&D, agricultural technology, and advanced data algorithms to drive innovation.

In Q3 of 2020, we achieved a 2.5% growth rate. Non-GAAP net profit margin was 2.5% on the back of 160 million RMB in non-GAAP net profit. Additionally, GAAP net profit margin was 2% with net profit of 130 million RMB. As of the end of Q3, the balance of cash and cash equivalent short-term restricted funds and short-term investments

amounted to 4.3 billion RMB. We continue to optimize CapEx efficiency in our financing structure. Excluding short-term loans, our balance of funds was 2.64 billion RMB. Additionally, free cash flow over the past 12 months increased by 270 million RMB as of the end of Q3 to reach 780 million RMB.

This concludes my prepared remarks.

Operator, we can now start the question and answer session.

Yes, thank you. We will now begin the question and answer session. To ask a question, you may press star then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If any time your question has been addressed and you would like to withdraw it, please press star then 2. When asking a question, please state it in Chinese first and then repeat it in English for the convenience of everyone on the call. At this time, we will pause momentarily to assemble the roster. And the first question comes from Thomas Chong with Jefferies.

Good evening. Thank you for introducing my question. Congratulations to the company for achieving excellent results this week. I would like to ask you how we achieved our goal. I heard that Q3 was held in Sazhan. Congratulations on the company's outstanding performance this quarter. I would like to know how this success was achieved. Additionally, I heard about the company's summer campaign in Q3. Beyond the financial resources shared, what other operational achievements have been made? Thank you.

Thank you for your question. Q3, we have achieved very good results. This is due to the comprehensive improvement of the business level, including the first contribution of the new warehouses. This year, 80 new warehouses have been opened. After these new warehouses are opened, the unit capacity can quickly climb up and start contributing to the big plate and profits. And these new warehouses, on the one hand, the daily unit capacity continues to increase, on the other hand, the improvement effect of the big plate will at least continue until the same period next year. Thank you for your question.

Our Q3 results were impressive and were due to a number of operational improvements. First, 80 new frontline fulfillment stations were opened this year, rapidly ramping up order volumes and contributing to growth and profitability. Daily average order volume at these newly opened fulfillment stations are also increasing. This increasing contribution trend is expected to last at least until the same period next year. In particular, the fulfillment stations open in new areas such as Tonglu in Hangzhou and Huangyan in Taizhou have further enhanced our penetration rate into local markets there.

Yeah. uh foreign

Second, we continue to enhance our product structure and categories. Since the beginning of the year, we have expanded our offerings for the coffee tabletop category, including fruits, dairy, wine, snacks, and baked goods. In Q3, Shanghai saw an increase of over 400 SKUs on the shelves per day per station in these four categories compared to the previous year. As we broaden our product variety, average daily transaction volume also has grown. For example, average daily transactions in the snacks category increased 9% year-over-year.

Thirdly, we have further improved the efficiency of the control unit. On the one hand, we have improved the prediction system, improved the accuracy of the storage information in the front compartment, and brought about an improvement in our supply and demand rate. On the other hand, we have strengthened the response speed in the special weather and the hot season, and further improved the delivery efficiency, which is the shortest, the shortest, the longest, and the best two minutes. These have brought about a better user experience, and the down payment rate has also increased by 5%.

Lastly, we have significantly enhanced our end-to-end efficiency. We improved our forecasting system, which increased the accuracy of inventory management in our frontline fulfillment stations, resulting in low out-of-stock rates and fewer products near expiration. Additionally, we enhanced our delivery speed during extreme weather events and holidays, further improving delivery efficiency. We've also optimized the soon-as-available appointment time, reducing it by two minutes compared to the same period last year. These enhancements have contributed to a better user experience, leading to a 5 percentage point increase year-over-year in order conversion rates.

Recent improvements have also contributed to rapid growth in lower-tier cities within Jiangsu and Zhejiang.

This quarter, excluding the top three cities, Shanghai, Suzhou and Hangzhou, GMV and other cities across these regions increased by over 40% year-over-year. Notably, 13 of these cities experienced a growth rate exceeding 50% year-over-year.

I want to talk a little bit about my thoughts on the results of this quarter. Dingdong Maicai is a startup company that focuses on good food. We believe that development is the hard truth. Only by continuing to improve and fight for victory can we have the confidence to deal with not only the changing society but also the competitive business environment. We will never be satisfied with the current results. I'd like to share some additional thoughts on our performances quarter. We're still in the early growth phase and are focused on providing quality fresh groceries. We firmly believe that development is the only way forward.

Continuous progress and consistent success are vital for us to adapt to an ever-changing market and competitive environment. We'll not stop here, however, and still have a long way to go. As I have emphasized internally, we must always set higher goals for ourselves and aspire to great ideals while remaining attentive to small details. We should cultivate resilience against fragility and entropy, ensuring that we always adopt a startup mindset.

Thank you.

Thank you.

Thank you. And the next question comes from Young Bai with CICC.

Thank you, Mr. Guan. I would like to ask a question about the supply chain. The company has long abandoned food development and production processing on the supply chain. And we see that the company's supply chain capacity has already reached other sales channels. Can you give us an introduction of this year's I will translate that myself. The company has established its food research and development production and processing within the supply chain from early on. As a result, its supply chain capabilities have started to extend to other scale channels. Could you please introduce the supply chain development of Dingdong's self-developed factory this year? Thank you.

Thank you for your question. Jindong Grocery has always taken product power as our first driving force. Our goal is to provide users with better quality products. Thank you for your question.

We've always prioritized product quality as our primary driving force. Our goal is to provide users with differentiated high quality products. To achieve this, we focus on developing independent production and research and development capabilities, and our factory direct supply chain is continuously evolving and improving. By gaining deeper insights into consumer demand, we can better focus our ongoing investment on product development and innovation while also enhancing product efficiency. Currently, we have 12 self-operated factories that specialize in meat cutting and processing grain and bean products as well as prepare meals. Taking meat cutting and processing as an example, we began with the most basic product, white pork. Our daily fresh pork brand, which is widely recognized, was built from the ground up and has now become a well-established brand in the market. Currently, we operate five factories with capacity to produce 500,000 boxes of white pork daily, positioning us as the factory with the highest overall production capacity in the country.

Thank you for watching.

This year, we began acquiring and breeding black pigs to produce differentiated high-quality black pork. After extensive research into breeding bases, we selected the Sichuan, Tibet region for its ideal conditions. Black pigs thrive in the mountainous environment of this region, often referred to as natural oxygen tanks. These pigs are raised using comprehensive and refined methods, resulting in better taste and a higher lean meat ratio and improved health. Our strategic partnership with a black pig breeder boasting nearly 30 years of experience enables us to collaborate closely through order breeding. This partnership ensures consistent quality and supply with an anticipated volume of 80,000 pigs next year.

And then we design products according to the consumer's needs. For each part, we do a detailed division, addition and packaging. In addition to the basic fresh products, we also develop black pork-related pre-made dishes in conjunction with our food industry. We have also newly developed products such as lunch meat and pork lard, especially pork lard products. It wasn't supposed to be processed, but it became a popular snack for consumers. This year's Q3, our black pig brand, Black Diamond, has grown by nearly 45% with a profit of about 60 million yuan. And we plan to open 4 to 5 black pig meat offline stores this year. In October, we have opened two stores, so that we can serve different consumers in more channels, and also serve consumers' daily growth needs for a better life through better products.

We also design products that align with consumer demand and refine product segmentation, processing, and packaging for various pork cuts. In addition to our basic fresh grocery offerings, we partner with Cai Chengqing, one of our self-owned brands, to create prepared meals featuring black pork. We also innovatively develop products such as luncheon meat and lard residue. Notably, lard residue, once considered valueless and destined for disposal, has now transformed into a popular coffee table snack among consumers. In Q3, GMV of Black Diamond Family, our black pork brand was approximately 60 million renminbi, a year-over-year increase of nearly 45%. Additionally, we plan to open four to five black pork physical stores this year, with two already open as of October, allowing us to better meet consumers' growing demand for a better life across more diverse channels and through improved products.

Lastly, our external sales channels are experiencing significant growth. In Q3, external sales revenue from our three major product categories

Meats, cereals, and prepared meals reached nearly 100 million RMB, a 180% year-over-year increase. This substantial growth underscores the strength and potential of our supply chain. Thank you.

Thank you. And once again, please press star, then 1 if you would like to ask a question. And the next question comes from Xingxin Li with CMS.

I have noticed that the company's cash situation is improving significantly. Can you provide a more detailed introduction to the company's cash situation? Thank you.

好的,谢谢您的问题。这个问题交给CFO王松来回答。 Thank you for your question. I'll pass the question on to our CFO王松。 好的,谢谢梁总。正如您观察到的,随着我们的规模和盈利持续高质量的增长,我们的现金状况持续改善。 我主要从四个方面入手,向大家简单介绍一下公司的资金整体情况。

Thank you, Mr. Liang. As you mentioned, the scale and profitability of our business is expanding, which is positively impacting our cash position. I would like to highlight four key aspects to give a brief overview of our overall position of funds.

First, our cash flow is getting better and better. We have maintained cash flow for five consecutive weeks. First, operating cash flow has consistently improved.

With net inflow of five consecutive quarters, this trend indicates a strengthening ability to generate self-sustaining cash. In Q3, net inflow reached 400 million RMB, an increase of 270 million RMB from the same period last year and the highest level in the past two years. Free cash flow over the past 12 months was 780 million RMB, another recent historic peak. As previously mentioned, we're increasing our target and plan to open approximately 110 frontline fulfillment stations this year, with CapEx expected to be around 60 million RMB. We have ample cash on hand to expand our fulfillment station network.

第二,我们通过数据算法持续优化库存管理能力,提高运营资金的使用效率。 Q3的重获周转天数为10.7天,同比加快了1.3天。 Second, we continue to enhance inventory management capabilities and improve the efficiency of our networking capital through advanced data algorithms.

In Q3, inventory turnover days were decreased to 10.7 days, 1.3 days less than the same period last year. Additionally, we're committed to fostering a robust ecosystem among our upstream and downstream partners. Given the relatively short payment period for suppliers in the industry, we're working to provide greater support and empowerment to partners by continuously optimizing our payment terms. In Q3, the average payment period for accounts payable was 32.4 days, a decrease of 3.8 days compared to the same period last year.

Third, on the basis of optimizing the efficiency of free funds, our financing structure is also constantly optimizing. As of the end of September, our net debt amounted to 16.6 billion yuan, which decreased by 55.2% at the end of September last year, significantly reducing the company's financial costs. Our Q3 interest income amount increased by 13.11 million yuan, which increased by 83.5%.

Third, to improve capital efficiency, we're actively optimizing our financing structure. As of the end of September, our interest-bearing debt balance was 1.66 billion RMB, a decrease of 55.2% from the same period last year. This decrease has significantly lowered our financial expenses. Additionally, net interest income in Q3 increased by more than 13 million RMB compared to the same period last year. an impressive increase of 83.5%.

Lastly, leveraging our optimized financing structure, our actual self-owned funds balance after deducting the interest-bearing debt increased for the fifth quarter in a row. As of September 30, 2024, it stood at RMB2.64 billion, an increase of RMB320 million sequentially,

and the highest level recorded in recent years, demonstrating the strength of our balance sheet. Coupled with the healthy development of our business and ongoing improvement in capital efficiency and financing structure, we have ample resources to support our future growth. Thank you. Thank you.

And once again, please press star then 1 if you would like to ask a question. All right, as there are no further questions, I would like to turn the call to our management.

Thank you again for joining our call today. If you have any further questions, please feel free to contact us. Our request is through our website. We look forward to speaking with everyone in our next earnings call. Have a good day and have a good night.

Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.