Dpc Dash Ltd

Good day and welcome to the DPC Dash Ltd first half 2026 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad, and to withdraw your question, please press star then two. Please note today's event is being recorded. I'd now like to turn the conference over to Cathy Zong with Investor Relations. Please go ahead.

Thank you, Operator. Hello, everyone, and thank you for joining us on today's call. Again, as a reminder, you're all currently on mute. We will open up the floor during Q&A session after management's prepared remarks. We will try to answer as many questions as time allows. Today you will hear from Ms. Eileen Wang, Executive Director and CEO of DPC Dash Ms. Helen Wu, CFO of DPC Dash and Mr. Michael Xu, CPO of DPC Dash Eileen will provide insights into the company's overall performance and share recent developments Helen will go a bit deeper into the first half financial results The management team will address your questions after their remarks Before we continue, I'd like to remind you that our earnings call and investor materials contain forward-looking statements about our business that may be considered as forward-looking statements under applicable securities laws, which are based on various assumptions and other factors that are beyond the company's control and are subject to risks, future events, and uncertainties. Accordingly, actual results may differ materially and adversely from those anticipated or implied in the forward-looking statements. You can identify these forward-looking statements because they include terminologies such as may, will, expect, estimate, believe, going forward, plan, projection, aim, or other similar expressions. Statements that are not historical facts, including but not limited to the statements about the company's beliefs, plans, and expectations are forward-looking statements. All forward-looking statements should be considered in conjunction with the cautionary statements in our earnings release and the risk factors included in our filings with the Hong Kong Stock Exchange. Also, this call includes discussions of financial information and certain non-IFRS financial measures. Please refer to our results announcements and interim report to be published in accordance with the rules governing the listing of the securities on the Stock Exchange of Hong Kong Limited, which contain a reconciliation of the non-IFRS measures to IFRS measures. All information provided in this earnings call is as of the date of this call. The company, our affiliates, advisors, and representatives undertake no obligation to update any forward-looking statements except as required by law. With that, I will turn the call over to Ms. Aileen Wang, Executive Director and CEO of DPC Dash. Aileen, please go ahead.

Hello everyone and thank you for joining us today as we discuss DPC Dash Limit's results for the first half of 2026. As the exclusive master franchisee for Domino's Pizza in the Chinese mainland, Hong Kong SAR, and Macau SAR, we continue to operate in the market with substantial growth opportunities. Our global franchisor, Domino's Pizza Inc., remains one of the largest pizza companies in the world with more than 22,500 stores across over 90 markets as of the end of the reporting period. Before we discuss the figures, I want to contextualize our first half performance, which provides a clearer perspective on our current trajectory. Revenue grew 20.8% to RMB 3,133.8 million, driven primarily by a 33.7% year-over-year increase in transaction volume. This growth was feared by both our expanding store network and a 7.1% increase in same-store transactions. However, this half was characterized by two opposing forces, robust demand and network expansion versus pricing pressure from industry-wide aggregator subsidy dynamics. I will now outline how these dynamics diverged across our different types of markets. Let's start with our initial city markets Defined as the markets we entered before 2023, where we have the longest operating history, transaction counts accelerated and same-store transaction growth was 8.5%, actually a healthy number. But same-store sales growth turned negative, marking the first such occurrence in these initial seeding markets in recent years. We did not see evidence of a broad-based demand deterioration in our initial selling markets. Indeed, more customers were visiting us. This shift was primarily attributable to the intensified third-party platforms' subsidy campaigns leading to lower average ticket as they put in a meaningful share of orders onto these lower-priced channels. Now, let's turn to our new seeding markets. The markets we have entered since 2023. SG, while still negative at negative 9.4%, has narrowed consistently for three consecutive halves. We have improved from negative 19.6% to negative 13.2% and now negative 9.4%. This is the normalizing curve we expect to see. When we enter a new city, our first store is open to extraordinary demand, often the strongest sales performance in the entire domino system globally. As that initial launch phase settles and we increase more store density to drive operational efficiency, same store comparisons naturally experience contraction for a period. We made a deliberate choice on managing this transition period, and I would like to outline our strategic rationale behind our decision making. Rather than waiting out the 3pp subsidy wave, we viewed this as a one-of-a-kind meeting window and then accelerated the rollout of delivery services in our new sitting stores ahead of our original plan. As a result, delivery order contribution in these new sitting stores rose to 25% today and in a much faster pace as we observed in our initial sitting markets in the past. We want to point out that, through building delivery penetration, together with launching value and other initiatives, same-store transaction growth in New City markets turned positive at 2.2%, up from negative 19.1% a year ago and negative 7.9% in the second half of last year. However, Embracing aggregated platforms meant accepting a lower realized transaction price in the near term, since 3PP orders carry a lower average ticket than orders through our own channels. But we believe that the customer habits and brand mindshare we are building today in what is an early and formative period for delivery in these new cities like what we did in the initial cities will yield long-term benefits. And importantly, even at the deep point of same-store sales comparison cycle, the underlying economics level at these stores has remained healthy. Our 93 stores opening new markets this half generated an average daily sales of RMB 28,230 with a weighted expected payback period of just 14.8 months. Beyond the network expansion and same-store story, we continue to innovate our products and collaborate with popular IPs to engage with our customers. To name a few of the highlights, we launched a crispy croissant crust, football-filled square-shaped pizza, durian chicken pizza, and energy bowl series, alongside a successful partner with the gaming titled Ark Knights, Mingri Fangzhou, to capture a larger share of the use demographics. On delivery, we maintain a delivery on-time rate of 93.6%, even as volumes grow significantly, which speaks to the quality of our operating system. On digital engagement, our loyalty program grew to 41.9 million members, up from 30.1 million a year ago, with 18.1 million new customers placing their first order over the past 12 months. On our supply chain, our Food Supply Chain Center in Wuhan commenced operations on August 21, 2026, serving over 200 stores around Wuhan areas across the western region. We have also secured sites in Chengdu and Nanjing, targeting opening during the second half of 2027. We believe these investments are necessary to solidify our proud and operation foundation as we keep scaling. Moving forward, our strategy is defined by a distinct approach to our two core business segments. In our initial selling markets, the priority is structural average ticket improvement. Orders placed through our own channels, our application, and WeChat Mini program have consistently carried an ATP, meaning average transaction price, above RMB 90, meaningfully higher than 3pp orders. So our focus is migrating more customers back to these higher value channels through our loyalty program, Humble Mew Innovation, etc. In our new city markets, the priority is still expansion and penetration. continuing to scale up delivery from its current base of around 25% and communicating our iconic value programs while taking similar initiatives to migrate customers to our own channels and elevating ADP. Regarding our network expansion, we remain on track to open approximately 350 net new stores in 2026, have already delivered 235 openings in the first half. To better quantify our long-term growth potential, we're introducing store density as a key performance indicator this period. Currently, China's overall pizza market density stands at 13.9 stores per million population, while our own national footprint is just 1.1. We believe these metrics provide a more precise illustration of the significant unpenetrated demand available to us, highlighting a substantial runway for growth both through new city entry and further densification of our existing markets. With that, I'll hand the call over to Helen to discuss our financial results in more detail.

Thank you, Eileen. Our financial results this half encapsulate the margin dynamics resulting from our continued network scale up amidst the ongoing market subsidies. I will now detail the specific impacts across our P&L. Revenue Performance The total revenue grew 20.8% year-over-year to RMB 3,133.8 million. Alongside our usual tier 1 versus non-tier 1 breakdown, we're also sharing a new lens this half based on market maturity, the initial city markets versus new city markets, which we think gives a clearer picture of where our growth is coming from. Looking at this by market maturity, our initial city markets contributed RMB 1,723.9 million or 55% of revenue. Growing modestly as strong transaction grows was largely offset by the ATP pressure Ailin described previously. Our new city markets contributed RMB 1,410 million, now accounting for 45% of revenue and up from 34.6% a year ago, growing 57.3% as our expanding new store base scaled up. Looking at the same revenue through our tier 1 versus non-tier 1 lens, non-tier 1 markets grow 36.5% to RMB 2,059.7 million and now represent 65.7% of revenue, again reflecting our revenue network growth is concentrated. The channel story reflects the same underlying dynamic playing out again. Total delivery sales grew 44.7% to RMB 1,618.8 million, now representing 51.7% of revenue. But within that, deliveries through third-party platforms grew 81%, while deliveries through our own channel actually declined 11.8%, because the subsidy pulled orders through 3pp. This matters for margin because our own channel delivery orders carry an ATP average transaction price of RMB 94. So every order that shifts channel has a direct effect on our realized pricing. Not because the customers are spending less, but because of which door they are walking through. So offering the differentiated value and services to build up a larger base of customers of a high quality loyal customers over time will help us improve ATP and order economics and a higher lifetime value of our customers. Margins and cost efficiency. This channel and pricing dynamic flow straight through to our store level profitability. Store-level IPTA grew 8.3% to RMB 544.5 million, though the margin declined to 17.4% from 19.4%. And the store-level operating profit grew 2.9% to RMB 390.4 million, with the margin at 12.5% versus 14.6% a year ago. The primary driver was the lower ATP, or together with a higher 3pp delivery sales mix which carries a different cost structure. And this was only partially offset by the cost efficiency measures that we have underway. To put some texture on that offset, our raw material cost, rental and other store level cost all grew broadly in line with our revenue and store count growth. and in a few areas we actually improved. Advertising and promotion expenses fell to 5% of revenue from 5.3%, and the store operation and maintenance expenses improved slightly to 6% from 6.1%, both reflecting more efficient spending as we scale. Where we saw more pressure was in the store-level staff cost, which rose to 28.9% of revenue from 27.7%. Reflecting the staffing we put into our new stores to protect service quality, plus the simple mathematical effect that lower ADS means less revenue to spread our fixed labor costs and also the higher rider costs from our growing delivery volume. At the group level, our corporate cost discipline served as an effective buffer, improving from 8.1% to 7.5% of revenue as we get scale benefit and cost control at headquarters even while we keep investing to support our growth. Put it all together, adjusted EBITDA grew 8.6% to RMB350.7 million, with margin at 11.2% versus 12.4% last year, and the adjusted net profit grew 7.4% to RMB98.2 million. Liquidity and Capital Allocation We ended the period with cash and bank balances of RMB 934.7 million. Our operating cash flow grew to RMB 504.9 million from RMB 361.1 million. So this means that our growth continued to be substantially supported by internally generated cash. Our gearing ratio improved to 7.9% from 8.2%, and we retain RMB 300 million in unutilized credit facilities, so we are comfortable with our funding positions as we continue to expand. Looking at our capital expenditure, at the store level, our average capex for a new store Excluding the landlord rental deposits and net of tax is approximately RMB 1.3 million per store. We will continue to optimize the store design and procurement to further lower new store capex and improve the cash payback cycles. Looking ahead, we will continue to invest in our three main areas, store expansion, supply chain sensor investment, and the digital infrastructure to build our competitive strengths for the business in the longer term. To sum up, this HOTS result tells a consistent story across both the operating and financial members. Our underlying demand and network growth are healthy, and in the case of renew city markets, the improving is faster than expected. While pricing pressure from the current subsidy environment is a near-term drag on margin, but with a clear pathway for recovery as subsidy gradually normalized, the channel mix improves and together with our other growth levers. Now also with our own cost efficiency initiative continue to build, we believe the business remains well positioned to benefit from operating leverage as sales productivity improves. This marks the end of our presentation and we will open the floor for questions now. Thank you very much, operator.

Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. If you're using a speakerphone, we ask that you please pick up your handset before pressing the keys. At this time, we'll pause for just a moment to assemble our roster. And today's first question comes from Lisa Liao with Jefferies. Please go ahead.

Good evening, Elaine, Helen, and Michael. Thank you so much for the earnings call today. And here's two questions from my side. The first is about the same-store sales trend we have observed. In our fact sheet, we actually disclosed that we saw slightly positive same-store sales in May and June with successful marketing initiatives. So just wonder how do we see the most updated trend and what will be our key initiatives to help further support the same-store sales in the second half. And regarding my second question, it's more on the aggregator subsidies. So we know the most intensified subsidies actually happened last year. So how do we assess the overall subsidy level from aggregators this year? Do we see any mitigation or slightly better situation recently? and how does this impacted the overall consumer behaviors? What would be our key strategies to further drive our own delivery channels regarding this part? Thank you so much.

Thank you, Lisa, for the question. I'll take this one. So last year, the aggregator war actually started in May, right? So May and June, we already had this aggregator sort of subsidy impact. and then at the same time we have the new market normalization impact so with that we can still manage to actually keep SHG positive for May and June that actually shows the strength of our strategy and also our sales initiatives now that said going forward in H2 I think last year in H2 sort of we have several things happening one thing is that the aggregate wall actually went to the peak right So in the summertime and also in sort of part of the quarter three. So then we're counting against a very strong base of last year. And then at the same time, you know, we have very strong sort of new markets, the record-breaking Shenyang, that kind of new markets entering the same cycle. So these actually will make the S&P sort of, you know, got some difficulty in H2. But then at the same time, we continue to see the average ticket started to stabilize and also improving. So then with these two together, we will still see SSG negative in the second half of the year of 2026. Now, but we forecast to see in 2027, we'll start to have positive stem cell cells. So that's to sort of answer sort of high level the first question. And then in terms of the initiatives, right, So like we mentioned so for the initial markets the key issue is actually the average ticket because the TC is still sort of healthy and then we also need to find a way to support H2 when the subsidy level goes down and then for the new markets We did have, you know, company against the higher opening base in the past, and plus the same issue on ATP. So then the initiatives actually have two aspects. The first one is actually on the average ticket, we already see it started to stabilize. And then we actually started to see that in the past two months, it actually got improving, right. So I think The key is actually sort of one, the CPP with the subsidy level going down, the average ticket on CPP will actually come back naturally. And then two, as Helen mentioned, our own online channel for delivery, our average ticket is actually as high as 94. So then we do have people who are very loyal to us and then pay higher average ticket on our own channel. So then the key is how to convert aggregated customers to our own channel and then optimize the channel mix. And then on the TC side, We believe that in the initial markets, we will continue to, you know, launch innovative new products like we did for the durian chicken, for example. So durian is actually very popular in the pizza market, but we're the first brand to actually put protein together with durian, which is a great innovation and our customers like it. And also across the leadership, we actually launched the crustal crust, right? It's another innovation to combine pizza and a bakery. So that proves that we will continue to lead on product innovation. And then also we launched this new combo, right? 79 with two pizzas, two sides and two drinks, right? With this, we do believe that it will help both on the average ticket side and also on the guest come side, right? Because this is quite attractive value. And then also by offering the combo, we make it very easy for customers to make choice. And then also we have other things like IP Innovation, and for the new markets, we will continue to offer the iconic value programs and also keep penetrating for our delivery as we continue to build the delivery market share in these cities. I stop here for a second for this first question. Now for the second question, with less aggregator subsidy this year, do we see sort of any influence on consumer behavior and also our own channel? So we did see that our own channel sales has been growing back. So we do believe that on the aggregators, there are two types of customers, either for their sort of this, you know, original OIO customers, and then as the aggregator actually provides more subsidy, so then they spend less on aggregators, so they move to aggregators for dominance, right? Or we have new customers coming to aggregators for dominance, right? I think for either one the original one if the subsidy actually goes down they will naturally come back to oil and then for the second group the new customers we will just let them know that how our own channel actually provides very different sort of value value propositions and then that way we will actually build more channel mix in terms of oil so I'll stop here Sorry, I talked a lot about these questions. Just to give you a full picture of what we're doing, average ticket versus TC, and the initial markets versus new markets.

Yes, very clear. Thank you so much, Abby.

Thank you. Our next question today comes from Lucy Yu at B of A Securities. Please go ahead.

Hi, Eileen, Helen. Thanks for taking my question. So two questions here. First of all is the subsidy will come down in the second half of this year. So how should we think about ticket counts in the second half? And also, the margin. For the first half, we saw margin has some contraction, possibly because of the negative . How should we think about the margin for the second half, especially on a year-over-year basis? Is the contraction going to be wider or narrower than the first half? Thank you.

Got it. Thank you for the question, Lucy. So for the first question, it will be quite similar to my answer to the first question. But then I'll reiterate that we do think that our sort of TC momentum is healthy, right? We're just competing against last year's high base. We do believe that we actually offer, you know, tasty and innovative products. we do offer a new value after 10 years of you know having the crazy Tuesday and Wednesday you know 30% off across all pizzas on Tuesday and Wednesday we actually offer this new and sort of different value in terms of the combo and then customers like it and then at the same time we also start to offer single view offers right because we realize there's a new occasion for this new demand right And then at the same time for the new markets, we'll emphasize more sort of delivery and also value and all the levers we mentioned for the initial markets. One thing I can mention more is actually the media optimization. We have our new CMO joining. Her background is Coca-Cola and McDonald's. She brought in a lot of new thoughts. and she will help us to optimize the media and spend that to create more sort of sales and also who's higher online. And I'll stop here for the first question. And the second question is on margin, I hand over to her.

Yes, Lucy, thank you for the questions. For the first half, our store operating profit margins at 12.5%, that's for the whole group, right? And also I think the initial city, the store OP margin is slightly below that. but the new market is higher than that the reason being even though people or you have seen that the SSC for the new market for the initial new market sorry for the new markets is actually negative but we have said that because they started from very high base in terms of dollar you know sales right so even if you they have a negative SSG when they enter this into the SSC cycle but in terms of dollar value wise in terms of sales they're still very, pretty high and very healthy. So their OP margin for the new city are actually higher than 12.5%. Now this trend is probably going to be the same for second half. And also, I think we also actually started from, you know, over the first half of this year, we also, you know, gradually rolling out a lot of our cost saving initiative or cost control initiative at the store level. Now some of that actually started from middle first half. So we would expect that more kind of effects or impacts on the cost saving will be kicking in during the second half. So for instance, we are actually try our best to recovering the ATP, right? And also at the same time, we have a lot of initiative to actually maintain or to keep the ticket transaction volume. So, you know, having You know, having the improving ATP at the same time, sort of more impact on cost saving initiative in the second half. Overall, we were expecting that actually the margin, the store OP margin will be actually better than the first half. And on this basis, the performance between the initial city markets versus the new city market will be similar in pattern for the first half.

Thank you. Our next question today comes from Linda Huang with Macquarie. Please go ahead.

Thank you.

Pardon me, Linda. This is the operator. I'm not sure if we were able to understand your question there. Your line was breaking up pretty badly. We cannot hear you, ma'am. So I'm going to move on to our next question. I apologize. And our next question today comes from Miao Zhang with CNBI. Please go ahead.

Thank you management for taking my question. I'm Miao Zhang from CNBI and I have just two small questions on 3PP users. Not so sure if it's been addressed already. Could make me share some color on what measures are currently being implemented or work out to convert 3PP users into our own platform and to boost their repurchase frequency or lift average transaction price and also I'm wondering is there any available statistics rate or retention rate of such measures?

Thank you. Okay, I'll take this question. So the question is, what measures are being taken to convert platform users to online users, right? Okay, so like I mentioned before, right, I think for the aggregators, for the Domino's users, either they're actually converted from the OIO of Domino's, or they're actually sort of new customers choosing Domino's and aggregators, right? For the first of all people, we actually think that with the subsidy coming down, they will actually naturally come back. Now that said, we're also taking proactive approach to actually attract people back to OAO. And then for the new customers, we also want to highlight our own online channel offering different things. So first, the value we're offering on two channels are different. Our aggregators is more like Red Pocket or if you reach this level, you deduct this level. But in our own channel, we have this combo. We have Crazy Tuesday and Wednesday, which are very different for different needs. And then also we have the loyalty program. And by the way, our loyalty program actually has 42 million members already, right? So these people who are very loyal to us and then stay with us on our own channel. So we attract people to get on our own channel and they can only actually get points, you know, through our own channels orders. And then at the same time, once people are on our own channel, we're upgrading, you know, our OOO experience, right, to make that smoother and also to help us to sort of, you know, improve the average ticket. And then also we have different engagements, digital games, you know, bounce back coupons, and then, you know, proprietary interactive properties

These are the things we already- Pardon me, this is the operator. Looks like we may have lost audio from our main speaking line here. If you can please stand by, I'll play some old music in the call and we'll be right back with you. Thank you. Hello everyone, looks like the- Apologies, it looks like the line is back. You can please proceed with your answer. Thank you, ma'am.

Got it. Okay, I don't know where you lost me.

Let me start from the beginning.

So we're talking about how to convert the aggregator platform users to our own online channel. We do think that our own online channel actually provides different differentiation, right? The first thing is the value. For example, the aggregator channel actually has, you know, The right pocket or if you reach some threshold and then you get deduction. But then on our own channel, you have to combo, right? You have the Tuesday and Wednesday. I think these are very different. And for the loyalty program, you actually get rewarded for the online channel. So that people get smoother experience. and then also they get this opportunity to actually upsell across China and then which will help. And then also our own channel, digital engagements, WeChat games and bonds by coupons and then you also have proprietary IP products etc. And then to get people back, we have different targeted and then customized offers, so CDP. So that's why we do think that oil is actually a different offer, and then we'll attract people back. And then we've been continuing to monitor the conversion and retention rate. So in the past, when the aggregator actually has higher subsidy, I think naturally these two channels, people actually coming back and forth, Then when the aggregate subsidy is higher, naturally people will go more toward the aggregate. But as the subsidy level goes down, we do see OOO channel is actually showing more growth as I mentioned before.

Thank you. Our next question today comes from Shengwei Lei with CICC. Please go ahead.

Hi, management. Thanks for taking that question. So I have one question regarding good store opening plan. So you have maintained a fast pace of store expansion here today. How should we think about the opening plan for 2026 and 2027? And how do you balance entering new cities versus opening stores in existing ones? Thank you.

Okay, I'll take this question. So as we mentioned in the earnings call, my part, we use this ratio of pizza store per million population. And if you look at the dominance pizza store per million population, ours is very low. It's only 1.1. We do think there's a very long way for us in China for the pizza store opening. And then we iterate that in the median term, the 3,000 targets unchanged. That shows we have high confidence in the Chinese pizza market and also our penetration. Now, as I mentioned before, for 2026, we're very much on track to achieve the target of 350. And in 2027, we're still in the sort of the planning phase. And then I think high level, we are very much on track, but then we'll decide the detailed opening number based on several things, the customer dynamics and also the opening performance.

Thank you. And our next question today comes from Kong Shi with CITIC Securities Company. Please go ahead.

Thank you for taking my questions. And good evening, management. I have only one question about average transaction value. And could you break down the reasons for the changes in the average transaction value for us? and how do we inspire the average transaction value trend going forward? That's my question. Thank you.

Thank you for your question. So for the average ticket, right? So we do believe that the average ticket change was primarily attributable to the channel shift. So as we mentioned, for the aggregators, the average ticket is actually lower because of the subsidy. And then for our own channel, it stays actually quite healthy. So we already see that naturally with the subsidy level going down, the pricing has been stabilized. And then we've been taking a lot of actions to proactively improve the average ticket. So we want to reiterate that the average ticket sort of improvement does not depend on aggregator subsidy going down or not. Actually on aggregators, we have offers and then we're continuing to optimize these offers. So that will help too. And then on our own channel, as I mentioned, so our error certificate is originally quite high. And then the question is how to actually sort of convert people from the aggregator channels to our own channels. So as I mentioned, Combo is actually a very good choice, right? So it has multiple items that will naturally actually increase the average ticket. And then also we're uplifting, you know, signs and drinks so that people can actually cross-sell and upsell more. And then at the same time, when we're launching, you know, new products, we also have average ticket in our mind. So for example, during ticket, it's actually a premium product. But as long as it's actually very good sort of taste and innovation, people are willing to pay for the hard ticket. So that's how we consider sort of on the average ticket.

Thank you.

Thank you.

And thank you, everyone. That does conclude our question and answer session. I'd like to turn the conference back over to the company for any final remarks.

Helen, do you want to comment more?

Well, first of all, for the trend in 27, one thing that we are seeing is that over the past few years, we've been going through the normalization and also the 3pp heavy subsidies, etc. And that's why our SST sort of experienced something that actually normally a brand probably wouldn't see. from high base and normalized and also in the overall market. Now, I think for 27, what we've been seeing or what we are looking at is that our SST will turn positive. That's number one. And second is that we would expect that ATP will gradually coming back. Now, this is something that we have seen over the past few months that actually ATP is coming back. It is on the back of a lot of the initiatives that we've already taken, for instance, the combo lunch, for instance, the differentiated services between the 3PP and also our online combo. So we will continue to work on that. Now, third part is the margin. Second half, as I have just said, actually, we would expect some improvement, second half versus the first half. Now, this trend will continue in 27 because a lot of the cost initiative savings we're going to actually put into place and stick to it. And so these are the things that we will actually carry on to 27. On top of that, because we're scaling up gradually, so as we build up a larger scale, a lot of other benefits in the scale will continue to unfold. So on top of that, so 27, we're also looking at the margin improvement versus 26. Yeah, so this is something that I will conclude for 27. And also in terms of store counts, first of all, 26, 96% of the total net opening of 350 has been locked in. So we are pretty much confident that we will deliver that for the net opening of 350. Now for 27 and beyond, we have a median term target of growing into 3000 store counts by the end of 2030. The store plan planning or the expansion planning for the next few years, we will actually work along that medium term target to actually plan for each year. And then also, depending on the factors, actually, I didn't just mention the store performance, the sector, we will actually, you know, every year we will roll out the appropriate store counts that fit our stage, fit our capacity and fit the medium term sweet starting target.

Thank you, Helen. Thank you for joining today's call and for your continued support. We look forward to keeping you updated on our progress moving forward. Thank you.

Thank you. That concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day.