Yalla Group Limited

Good morning and good evening, ladies and gentlemen. Thank you for attending Standing By for YALA Group Limits First Quarter 2021 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. Now I would like to turn the call over to your speaker host today, Ms. Keri Giles, IR Director of the company. Please go ahead, ma'am.

Hello everyone and welcome to YALA's first quarter 2021 earnings conference call. We released our earnings earlier today and the release is now available on our IR website as well as on news file services. Before we continue, please note that the discussion today will contain forward-looking statements made under the State Harbor Provision of the U.S. Private Security Identification Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, our future results may be materially different from the views expressed today. But the information regarding these and other risks and uncertainties is included in our earnings release and our registration statement filed with the SEC. YALA does not assume any obligation to update any forward-looking statements except as required by law. Please also note that YALA's earnings press release and this conference call include discussion of unaudited gap financial information as well as unaudited non-GAAP financial measures. Yellow's press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited most directly comparable GAAP measures. Today, you will hear from Mr. Tao Yang, our chairman and chief executive officer, who will provide an overview of our recent achievements and growth strategies. He will be followed by Mr. Saif-Ik Mayu, the company's president, who will give a brief review of our recent developments. Mrs. Karen Hu, our Chief Financial Officer, will then provide additional details on the company's financial results and discuss financial outlook. Following management's prepared remarks, we will open up the call to questions. Our Chief Operating Officer, Mr. Jeff Xu, will join the call for our QA session. With that said, I would now like to turn the call over to our Chairman and Chief Executive Officer, Mr. Tao Yang. Please go ahead, sir.

Thank you, Carrie. And thank you, everyone, for joining our 2021 first quarter conference call. 2021 is off to a remarkable start. YALA Group's total revenue increased almost by 40 percent, and reached 67.6 million USD, exceeding the upper end of our guidance range by 7.4 percent. This better performance was driven by our continued efforts to grow our user community, the effective conversion of active users into paying users, and the further advancement of our monetization capabilities and initiatives. In the first quarter of 2021, we also maintained robust profitability, as demonstrated by our non-GAAP net margin of 49.7%. With the strong execution of our efforts to raise brand awareness across the Middle East and North Africa region, and our effective marketing campaigns tailored to the local culture, monthly active users for our group increased by 14.6% QMQ, and it reached 18.8 million. In addition, increasing User engagement on our platform drove Yala Group's paying users up by 11.5%, quarter over quarter, to 5.8 million, leading to outstanding paying ratio of 31%. Our vulnerability to monetize also continues to improve as our group's revenue increases. our pool grew rapidly by 25.5% quarter-over-quarter, reaching $11.6 in Q1. During previous earnings calls, we announced four new products in our pipeline. Three of them are casual game platforms, including Balloot for users in Gulf countries, 101OK, for Turkish users, and Yellow Touches for South American users. The data version of all these three Casio game products have been made available online, and we have also made great progress in refining the technology code and user interface details of these new products over the past quarter. Our president, Saifi, will share more details with you in his part later. Our fourth new product is YallaChat, an instant message or IM product designed specifically for Arab users. We are pleased to share that we launched the second version of YallaChat in March. With this strategically significant product, Yalla Group aims to build and strengthen connections among our individual apps and create an integrated and synergistic ecosystem. To this end, we have adopted measures to attract the right talent to join our lead and product team. This better version supports basic instant messaging functions, such as messaging, voice chatting, and radio chatting. Since its launch, our development team has continued to refine and enhance the product based on user feedback. and we will gradually roll out new design features and functions on the platform based on the local users' feedback and desires. The improvement and the iteration of IAM products is always an ongoing process, and the initial beta stage can take more than several months. We are dedicated to perfecting the details of the product before the team decides to officially launch the product, and start full promotion. As we mentioned in our last earnings call, Yella's top priority this year is to expand our user base with new products lined up for official launch. We plan to increase our sales and marketing activities to build out an initial user base for this product. For our existing two products, Yella and Yella Ludo, we will maintain our strategy steady user goals and don't expect to see much change in exciting things related to these two apps. Furthermore, as we continuously enrich our portfolio, we aim to amplify synergies among our various products and gradually build and develop a comprehensive Yala ecosystem. Our president, I think, will elaborate more on his ideas, on these ideas in a few minutes. We had an outstanding first quarter marked by strong girls across our primary operational and financial metrics. In just a few days, Yella is going to have its fifth anniversary. Five years ago, we identified WordChat to be uniquely suitable for online social networking and entertainment in Nina and pioneered the development of YALA as the first voice-centric mobile social networking and entertainment platform in the region. Over the past five years, our leadership in this field went from stress to stress, and we gradually enriched and enhanced the product we offer to better serve local users while affirming our mission to build the most popular destination for online social networking and entertainment activities in MENA. Looking ahead, we continue to closely watch trends in MENA's local culture, expand our friendly community, and build YALA's ecosystem with various products and services tailored to local users' needs. Now I will turn the call over to our president, Mr. Saifi Ismail, for closer look at our recent development.