Fosun International Limited (656) Earnings Call Transcript & Summary

Good morning. Good morning, everyone. Dear investors, analysts and media friends very good morning. I'm the General Manager of Capital Market and Investor Relations of Fosun International. I'm Sun Lu. Welcome to Fosun International 2021 Interim Results Announcement. First of all, please allow me to introduce our senior executives and also classmates of Fosun International, they are; the Chairman of First International, Mr. Guo Guangchang; the Executive Director and Co-Chairman of Fosun International, Mr. Wang Qunbin; the Executive Director and the Co-CEO of Fosun International, Mr. Chen Qiyu; Executive Director and Co-CEO of Fosun International, Mr. Xiaoliang Xu; Executive Director, Executive President and CFO of Fosun International, Mr. Gong Ping. Today, we have a morning session to announce the interim results. And also we have our program in the afternoon session. In the morning session, the senior executives will give us the announcements on the interim results and to communicate with our analysts and investors. And over the past nearly 3 decades, especially over the past 1 decade, Fosun International has accomplished its global footprint. We have happiness and health and wealth and also manufacturing, these 4 business lines. And we also have a C2M, customer to maker. And over the past January, we have achievements. And also, we have made a lot of contribution. Most importantly, and it's the time for us to reap the fruit. And going forward, we are going to embrace the expansional and explosive growth. First of all, we would like to invite the Executive Director, Executive President, CFO of Fosun International, Mr. Gong Ping to introduce the financials on Fosun International. The floor is yours, Mr. Gong Alex.

Dear investors, good morning, everyone. First of all, on behalf of the Board of Directors of Fosun International, we would like to give you the announcement of our interim results. In the first half of this year, you can also take a look at our slides. And you can also see some of the key indicators. And in the first 6 months in 2021, we can see total revenue RMB 70.4 billion. And due to the challenge of the pandemic, you can see our results. You can see that up by 11% year-on-year. And it is contributed by Fosun Pharma and also Fidelidade, also and Peak Re. And we can see that -- and we have seen nearly CNY 600 million and also for our Intelligent Manufacturing and FFT. And currently, it's called Easun Technology and has also been consolidated, and they have also made a contribution to our performance. And compared with the same period of 2019, and you can see 3% increase, excluding Fosun Tourism Group. As we all know that because of the pandemic, we have seen the loss of FTG -- excluding FTG, you can see that up by 14% from the first half of 2019. Here, you can see that for all our management, and we have overcome all the difficulties and we have seen significant rebound performance. At the same time, and in terms of our profit, and we have also seen very solid liquidity, and we have seen the uplift of NAV. And also for Fosun International as a whole, at the end of June, and we have more than CNY 700 billion. And basically, slight increase by the end of June. And you can also see that we can see around the earnings per share is around HKD 18. And also in terms of our deposit and also liquidity, you can see that it is CNY 106 billion for our cash bank balances in terms deposits. And we also have the unutilized banking facilities with more than CNY 170 billion. And you can also see we have reduced the average cost of debt. And that is around 4.4%. And the adjusted NAV is HKD 31.65 per share, up by 21% year-on-year. This is thanks to the listed company of Fosun Pharma and Yuyuan and the Hainan Mining and also the improved market cap of Fosun Tourism. And then in terms of our leverage ratio, and you can see it is rather healthy compared with 2020. And you can see that in terms of the debt and the maturity, it is also healthy and also safe. As we all know that Fosun International, and we are focused on health, happiness and wealth and manufacturing, these 4 business segments. For these 4 businesses is the cost in 3 decades, particularly in the past 10 years. And based on the optimization, we entered the new markets and also the niche markets and also the new segments. And for all these 4 businesses in terms of the mix, and we have struck the balance. And also, you can see that and excluding the Fosun Tourism, you can see in terms of the net profit, we have also a very good structure. As you can see that in terms of the operating profit, and we have more than CNY 5.6 billion. For the operating profit, you can see up by 40%. So it is contributed by the health. Take the Fosun Pharma, for example, you can see its contribution is much higher. And also due to the centralized sourcing, especially for our Fosun Pharma, we have optimized our structure. And we also have Gland Pharma with more than 30% of the business increase. For the Intelligent Manufacturing, thanks to the price hike of commodities. We have made investment in Nanjing Steel and Hainan Mining and [indiscernible]. And you can see that profit contribution is also very robust. And you can see for the Intelligent Manufacturing, you can see that they are more than CNY 1.5 billion increase. And also for the health taken Fidelidade and Peak Re, and also for the Xinhua Insurance, you can see the profit has also been increased dramatically. Over the past years, we have also been impacted by the pandemic, particularly for the Fosun Tourism for happiness due to the loss by Fosun Tourism, there's some negative impact. But we're also very confident for the Fosun Tourism in terms of the product and also business model and also our implementation. We can still see very sound growth potential. So that's why we are also very confident for the Fosun Tourism. And we can also see that for all our 4 business segments, and also for the 10 product lines, particularly in terms of health, for health segment. So we have the pharmaceutical, devices and diagnostics and health care services and products, these 3 service segments. And also for the happiness, we have the tourism and culture and brand consumption. And you can see they contribute 80% and less than 20%, respectively. And for the wealth, we have insurance and also our Hive and also our asset management and investment. For these, 3 subsegments in the first half of this year, they contributed to nearly 80% and 12% and 9%, respectively. Then for our manufacturing, we have resources and environment and technology and Intelligent Manufacturing, these 2 segments, and particularly over the past nearly 10 years and thanks to the expansion and also optimization that we have secured our position. And going forward, you can see this is quite optimistic. And then let's take a look at our portfolio companies. So you can see the top 5 subsidiaries. For the top 5 subsidiaries, they contribute a lot. Yuyuan, Fosun Pharma and Fidelidade and Peak Re and FTG. And for these top 5, they contributed to nearly 80% of total revenue, to be exact 79%. Especially for Yuyuan, you can see that in the first half, they have grown dramatically, thanks to the fashion and jewelry and also the acquisition of Jin Hui Liquor. At the same time, for Fosun Pharma, as I mentioned just now, and you can see that the year-on-year growth is more than 20%. For Fidelidade, it is our overseas and insurance firm, Fosun Insurance Portugal, you can see year-on-year base increases more than 7%. And for the Peak Re, the increase is also 22%. So you can see that for the Fosun Tourism, we have a negative impact. But this year and also next year, we are looking forward to the positive growth. And when we review the past 3 years, particularly over the past 7 to 8 years in terms of financials and also in terms of CAGR, you can see that it is well done in terms of our revenue or EBITDA and also our profit or our NAV per share. And on the book and for the adjusted NAV, you can see the 2 digits of the growth for our CAGR. Because we are advocating these values under a stable growth. Particularly over the past 10 to 50 years for Fosun International, we put a lot of financial resources into the initiatives to ensure the sustainable new business segments. We have completed a global footprint from scratch. We have on our insurance and tourism segments and for health and in terms of innovative pharmaceuticals and also for the iron and steel and also mining, and we have also expanded our business into the Intelligent Manufacturing. We have very sound achievements. And I have to say that and we have the long-term global footprint, and particularly under the current circumstances, we will continue to go deeper into industrial operation. And we're also very confident of the rapid growth in terms of industrial operations. You can see we've already seen a very good scorecard of our industrial operations. For example, take Shede Spirits and Hainan Mining and also Sisram Medical as well as our newly acquired Wansheng. And you see they have achieved growth of 3 digits. And I didn't put 2 digits. Actually, we have a lot of companies achieving 2-digit growth. You can see that for these and core growth will be contributed by these industrial players. And also for our group, and we have the balance and the bold investment exit to reduce the cost of debt in order to optimize our capital structure. And we are very happy to see for the ratings agencies in February. And also yesterday, Moody's and also Standard & Poor's according to their rating and the outlook for our Fosun International has been upgraded to stable and 1 notch higher. So it is also based on our steady growth. And thirdly, and for a lot of businesses actually and we made investments from 0 to 1 and also for a lot of businesses, and they have been acquired in huge amounts. And there were some doubts in the past, but now we have to see less and less doubts. And in 2017, we acquired Gland Pharma in India, there were a lot of doubts. A lot of people casted doubt on our reputation, but you can see the successful IPO of Gland Pharma and also its share price is also going up. So there's no doubt anymore. And we also made a lot of investments on our Fosun Care. And at the end of last year and also in the first half of this year, and we have also completed a Series A funding. They're also a long queue of our investors. And also, we acquired FFT in Germany. And we have also completed Series A funding and we are looking forward to Series B funding, thanks to the support by the external investors and also thanks to the securitization. It also represents that we have already completed the incubation and the development from 0 to 1. And then going forward, we are going to go from 1 to 10 to 100 and higher growth and take our Fashion Group and also Valin Group in less than 1 to 2 years. We're also planning the IPO for these listed companies, and they are also going forward. And it is also well recognized by the equity investors, for example. And in the secondary and also the primary level subsidiaries, and we have completed 2 private placement, one is Sisram, the other one is Hainan Mining. We have completed a private placement. And with our deeper industrial operation and also the higher profit from our core industries and also better rating and we are going to see more transparent assets, and we are going to have clearer pricing in order to remove our investors' worries. And at the end of our financial reporting, and I would like to emphasize that in the past and we made a lot of investments on the sustainability. Now we are going to reap the fruit. And we are very happy about the stability. We are also confident for the return on investments. And now, I would like to switch the gears. I would like to invite Mr. Xu Xiaoliang, our Co-CEO, to talk about our business performance.

Thank you, Alex. Next, we would like to invite the Executive Director and Co-CEO of Fosun International, Mr. Xu Xiaoliang to give us the introduction to our 4 business segments. Mr. Xu Xiaoliang?

Good morning, everyone, and how time flies. And we have already seen the ending of the first half of 2021. And then next, I would like to give you some elaboration about the health and happiness and wealth and Intelligent Manufacturing. And let's take a look at some of our highlights of performance in the first half of this year. And first of all, let's take a look at our health business segment in the first half of this year. And based on the global health needs and we have also set up our portfolio covering pharmaceutical, medical devices and diagnostics and health services and products. And also based on the C2M for our Health segment and for our customer and where we have also set up the one-stop and full scenario health and ecosystem in the medical grade. And in the business segment, we have our innovative product matrix. And through R&D and innovation, we try to cater for the diversified needs. And from our customers, to be more specific in the first half. And you can see that we achieved revenue of CNY 16.9 billion, up by 21%. The growth is primarily driven by 3 pillars. One is driven by the innovative pharmaceutical products. And at the same time, and in terms of cosmetic and beauty, which is also growing exponentially. And we have also seen it is driven by the medical equipment. And also for the off-line medical services, we have also seen very rapid recovery. And also in terms of pharmaceutical segment in addition to the increase of revenue, we have also seen the optimization of product mix for our Hanlikang, and also Han Qu You and Su Ke Xin and Doptelet. And for these innovative drugs, it is a very important driver. And also in terms of the high-margin business segments, particularly our Gland Pharma in India in the first half, and you can see the sales revenue grew by 32% for Gland Pharma. And also for pharmaceutical, in addition to the excellent results, it is also contributed by the continuous R&D investment in the first half for Fosun Pharma. And you can then see that we have made investment by CNY 1.7 billion. You can see up by 50% for the R&D. And also in terms of the innovative drugs, you can see 60%. And so thanks to the R&D investment, we have also seen that the first China's mRNA COVID-19 vaccine COMIRNATY was launched in Hong Kong and Macau. And also for CAR-T, which is the first cell recipe or the cell therapy in China, actually has launched as well. And now in terms of our medical cosmetology and as a respiratory and also professional medical, these are the 3 pillars for our business. So in terms of medical cosmetology and for instance, we have a Sisram Medical. And it has already gained market share. And now we also moved into, for instance, injection filling and also dentistry. And also, we have a Da Vinci Surgical Robots in terms of installation and also in terms of the number of surgeries performed. Actually, we have seen wonderful performance. And in terms of health care management and also medical service delivery, this is the third pillar for our Health segment. And for instance, now we have focused on the highly professional departments and also businesses. And we have organic and also inorganic growth combined together. And currently now, we have 10 hospitals in our portfolio, and we have beds for more than 4,000. And also now we have upgraded Fosun Healthcare into Fosun Health. And we'd like to provide full scenario and also omnichannel and also one stop for customers around the globe, not only in China. So this is about health. And now let's switch gear and look at our happiness business and the segment. And of course, we focus on our family customers, and we have a large offering in our ecosystem for our happiness segments not only for our domestic clients, but also for our overseas clients. And here, we have 2 pillars. One is the consumer brands and the second is leisure and tourism. And in the first half of 2021, we focus on our customers' operation. So as you can see here, this is the total revenue we have a new growth. So the total revenue for H1 is RMB 28.46 billion. And also Yuyuan had announced year the interim performance yesterday and the total revenue is CNY 22.72 billion and also, we have a 12.7% year-on-year. And also, we see that for the profit attributable to parent companies actually has a year-on-year growth of 31%. And if we look at industrial operation income actually has a 58.5% growth year-on-year. And also the proportion continued to increase to 79.2% to RMB 18 billion. So therefore a breakdown and take a closer look. First of all, it's about jewelry and fashion and it has achieved a revenue of CNY 15.29 billion. And also, it has a newly added boutiques of 235 in the first half of 2021. And also for our Ancient Gold series, actually, the GMV in the first half of 2021 is CNY 1.6 billion. And last year, the annual number is CNY 1 billion. So as you can see for our Asian Gold series, it really has an exponential growth this year. And also, we have created a new Diamond brand called LUSANT and it was launched as well. And also in terms of the food beverage, for instance, we have Songhelou Restaurant Noodle and now it has 32 boutiques. And also, we have 27 in our pipeline about to be launched. And this year, the total number of Songhelou Restaurant -- Noodle Restaurant will be increased to near 100. And also for our liquor, Shede and also Jin Hui, they have a wonderful performance. For instance, Shede, has increased about 133%. And also the net profit attributable to the parent increased by 348%. And also for Jin Hui, the number is 56% year-on-year growth in the first half of 2021. And Alex has talked about the Foliday. Well, Foliday or FTG, well, it really took a hard blow from the pandemic, it has faced a lot of negative ramification. So in first half of 2021, the revenue is CNY 2.7 billion and also with a year-on-year decrease of 38.6%. However, now we see a lot of markets and geographies are riding out of the pandemic. We forecast a huge rebound or recovery and especially in our domestic market. And if we look at the operating cash flow, actually, last year, it is a negative CNY 726 million. However, this year, it become a positive -- it has become a positive number. And also in terms of profit and loss, and we can see that in the next year or in the future several years, it will have a very quick rebound. And also for our FTG in terms of Club Med, they have a wonderful performance. So the 1 -- H1 increased about 171.9%. And also, if we look at July's number, actually Club Med capacity has recovered to 73.2% of same period in 2019. And also for the business volume of Atlantis Sanya has increased by CNY 152.1 year-on-year. And also, we have welcomed more than 2.6 million customers and tourists. And also for Thomas Cook, well, we have the digitalization journey rolled out for Thomas Cook. And if we look at Thomas Cook platform, actually, download time -- the download times was more than 1.5 million. And now let's switch gear and to look at our fashion business. So under Fosun Fashion, we have several major businesses. For instance, we have Lanvin. And Lanvin in H1 2020 when compared with 2020, actually, it has achieved 110% of growth in terms of our business and compared with 2019, yet, number is at 40%. So now we have twin driver or dual engine and for Lanvin in domestic China, actually, it's growth in H1 2021 is more than 300% of growth. So it is really serious. And also in our fashion business, although in a lot of markets and geographies, we still have the ramification from the pandemic, but still we press ahead with our M&A. And for instance, we acquired Sergio Rossi, and it is a luxury brand footwear. And this is complementary to our current business. And also, if we look at Baihe Jiayuan and its revenue achieved CNY 528 million. And in 2021, we believe it will break even and then it will open a new chapter for its next stage of development. And now let's switch gear and look at wealth. And we have a global footprint in -- well around the globe, and we have a wonderful asset management capabilities, and we have enough dry powder. And for instance, we have insurance. And also, we have an investment fund and to provide a very stable and steady fund in the long run. And also in terms of assets, we have a top-notch assets around the globe, and we have, for instance, financial assets and also high property assets. And then we match the assets together with the source of funding. It is a nice matchmaking, and we can marry the wonderful assets with the steady and stable sources of funding. So the total revenue is CNY 19.65 billion in H1 2021. And also the profit attributable to the parent company is CNY 2.4 billion. And also, we have 102% year-on-year growth, and insurance is one of our major pillars. And for instance, the profit has increased about 172% year-on-year. And also for Hive, actually compared with 2020, the AUM has increased by 7.6%. And for our Insurance segment, insurance business, it is very important for Fosun International. And if we look at gross insurance premium for the first half of 2021, it is at CNY 27 billion and also investable assets is at CNY 170 billion. And also the combined ratio for our insurance business has only declined, and also the return on investment is increasing. So for 2021 for our global asset management, well, the total revenue is CNY 1.79 billion and also the AUM is CNY 150 billion. And in the future, our financial asset management will continue its globalization and internationalization journey and it will unleash its full potential and also to improve our bottom line and also our top line. And also, we will focus on economy sector and to improve our AUM continuously and also to collaborate with the city fund and to close collaboration with government. And also we will focus on, for instance, the non-debt financing and also investment. And therefore, in the future, we will continuously have a good match between assets and also the funding and to form a sustainable growth path. And also in terms of asset management for our property business, well, actually, we can see that we have Hive domestic -- for the Hive domestic the AUM is more than CNY 400 billion. And also in first half of this year, we have a new investment of CNY 9.1 billion. And also in [indiscernible] we have a wonderful project as well. And if we look at Hive overseas, well, we focus on Asia Pacific and North America and also EU, the AUM is more than CNY 13.2 billion, and also the year-on-year growth is around 10% compared with 2020. And also, we have made investment in first half of this year at CNY 0.62 billion. And now we have dual headquarters, we have one headquarter in Shanghai and another in Singapore. And we believe it is a very important way to go forward to provide us with a stable and steady lifeblood. And also, it is vital for us to go onto a sustainable development. And now let's look at the last business we have, that is the Intelligent Manufacturing. And we take a closer look at the upper stream and also middle stream and also downstream layout. So in terms of the upper stream, and we lowered the cost and improved the efficiency, and we focused on, for instance, raw material, we have made new requirements. And for instance, Wansheng company, which is a leading company producing phosphorus flame retardant. And also in the midstream, again, we have internal incubation together with inorganic growth, M&A and to better serve the downstream platforms. So the total revenue, yes, CNY 3.57 billion. And we can see we have a huge year-on-year growth of 202.2%. And also, we have the profit attributable to owners of the parent is CNY 1.63 billion and it is mainly due to the growth from NISCO and also Hainan Mining. NISCO really has a wonderful performance in first half. For instance, the revenue year-on-year increased 58.4% and profit year-on-year 102.7%. And also for Hainan Mining, now we are in up moving cycle, and also we implement lean management. So as you can see here, the revenue has increased by 61.02% and also profit has increased by more than 2,000 -- nearly 3,000%. So for NISCO and Hainan Mining, well, we also focused to align our goal with our national goal in terms of carbon peak and also carbon neutrality. So in terms of profit and also revenue, as I have talked about, NISCO has a wonderful growth in the first half of 2021. And in the future, it will also move into the new material industry, and it has acquired Wansheng company. And Wansheng, as I have said, it is a leading platform for phosphorus fire retardant. And also, on the other hand, we are making new investments in terms of plants and also factories and facilities to enhance our output capacity. And also Hainan Mining, will focus on the oil and gas businesses and also ground mining to collaborate with Hainan government and to provide a complementary role in our total business. And also in terms of profit, it has a huge improvement. And it has the existing platform as ore mining. And also for ROC Oil has made successful acquirement for a patch of a tight gas. And also, you have finished private placement, and we see oversubscriptions from the market from our investors. And this shows that the market is having a very booming oil phase in performance. And also, we have Besino and also FFT and also JEVE Power and also Wansheng. So if you look at their top line and also bottom line, both are increasing. And also their capacity is expanding. And also they have consolidated. They are putting in place a consolidated supply chain and industrial chain. And so for all these enterprises, they are talking with the investors, and they have -- thought highly by the primary market and also they have introduced a strategic investment -- investors on going forward. So this is about Fosun's performance in terms of health, wealth, happiness and also Intelligent Manufacturing highlights regarding to our business and performance. And now I'd like to hand over the microphone to Mr. Chen Qiyu. And he will talk about, for instance, our organizational evolvement and also our strategy optimization. So now with further ado, well, I'd like to hand over the microphone to Mr. Chen.

Thank you, Mr. Xu Xiaoliang And now I'd like to invite Mr. Chen Qiyu, the Executive Director and also co-CEO of Fosun International to talk about corporate governance.

Now it's my turn. Well, I will talk about corporate governance, but not only about corporate governance, but more about our development plan. How can we develop it better and also faster on going forward? So basically here, I'd like to talk about the 3 aspects that is multiple growth, entrepreneurship and also greater responsibility. In terms of multiple growth, we'd like to center around our investors and to make ourselves a great company to become a great company, not only in the eyes of our customers, but also for the market and also for the investors and in terms of entrepreneurship. And we'd like to become the best employer and also for the greater responsibility, great accountability, that is we want to interweave ourselves into the intricate network of that of the society and to contribute more to the society as a whole. So in terms of multiple growth, well, next year will be the 30 years anniversary for Fosun International, and we can divide our journey into 4 phases. So from 1992 to 2000 and basically, we put down our roots in China and also the overseas market. And in 2001 to 2007, we focused on the Chinese market, but also we fastly -- rapidly expand to the overseas market. And then -- and by then, we already have our real estate business and also health business and also our gas and mining business. And also in 2008 to 2018, here, we put together Chinese momentum with our global resources, and we have the twin driver for our future growth. And then we have the framework for our investment and philosophy. And since 2019, here, we focus on industrial operation, we need to deepen our industrial operation. And in the past 1.5 years since the pandemic, actually, we focus on industrial operation. This is the top priority for our current business. And also our investment is to serve the industrial operation to play a complementary role, and then we have made our Intelligent Manufacturing into a stand-alone segment. Well, in terms of strategy, we always think about how we can create our ecosystem that can serve more than 1 billion family customers. And we focus on, of course, industry operation and with industrial investment. Well, this is something that remains unchanged ongoing to the future. And also, we have the FES system. The second is to create a FC2M Ecosystem. As you can see on the right, and now we're in the middle of the Internet era. And when we look into the future, well before Fosun only focused on M, but ongoing to the future, we will also put C on top and then to form the FC2M Ecosystem. And also the third is about innovation driven and that you have not only product innovation but also management innovation. And fourthly, and we would like to build our second version of globalization in the future process of globalization. So this is also very rare for Chinese enterprises and to be globalized. I'm talking about the FES, our Fosun system. And we continue to focus on the technology and innovation and also investment in industrial operation. And talking about FES, E refers to entrepreneurship as well as our ecosystem. Under FES, we have 5 basic models. One is the growth. Strategically speaking, we have to plan and also advocate the sustainable growth for our business segments. And secondly, we need to have our organization or our mechanism to ensure the growth. And thirdly, we need to have a very effective ecosystem. And based on all the global families, and then we can come up with our ecological synergies to serve our global families and the customers. Of course, we attach great importance to risk control and also the lean operation. And from top to bottom, we are going to guide the evolution for all our business. And also, first of all, talking about the twin drivers of industrial operation and investment, the first thing is about industrial operation. Over the -- particularly the past 20 years, we already have the closed loop of operational management. And we have our strategic planning and also our budgeting and talent planning and also the evaluation and also the rewards and the punishment and also the operational supervision. And we have both a short-term and long-term mechanism. And we also have 1 plus 2 plus 7, and we have for a long term of 10 years and planning. And also, we focus on the short-term synergies and also improvement. And in terms of our industrial investment, this is also a very important driver. Talking about industrial operation and investment, they cannot be separated from each other. And we are using the global competency to empower our growth in operation. And in the past for Fosun Pharma, we always say that one is an internal growth and also external growth and also the integrated growth. So that is also the essence of the twin drivers of industrial operation and investment for all our business segments. So you can see that in 2017, we acquired Gland Pharma. And for our global footprint and also in the global generic drugs, and we have also boosted our global presence. And also for Gland Pharma, and it is the top 5 pharmaceutical company in the Indian market. And also in the happiness as mentioned by Xu Xiaoliang, we have acquired the spirits and also the liquor. And you can see that these are the implementation of our strategic planning. And also for Fidelidade, we have acquired the company in Peru. So they moved from a European-based insurance firm to expand into the South American market and also for FFT and also JEVE Power. And we are also engaged in the automotive landscape. And also for the FC2M, first of all, we will always put C on the top. Because for our Fosun growth in the past, we put a lot of emphasis on the M. That is more about the M&A and for our product services. And for the C, it was also very strong in the past. But due to the impact by the Internet, and if we want to continue to center on the Internet and online marketing, that is still less capable. That's why we also try to push forward the FC2M particularly C on the top over the past couple of years in terms of integrated marketing and digital marketing and also the product co-creation, we already have more than 376 million registered users and 200,000 total number of high-power users. And also the satisfaction rate is 75%. It is still on the rise. Of course, we have to create a good product by different means. For example, BD, R&D and investment and also business driven incubation, et cetera, we try to create more good products. Maybe you can already feel that in Fosun ecosystem, that is all about our good products and also biosimilar for Henlius and also the CAR-T from Kite and Atlantis, AHAVA, Club Med and, et cetera. And you can tangibly feel these products and services. In terms of globalization over the past many years, since 2007 and '08, and we always adhere to the core competitiveness. And we started from both industrial operation and investment. And Fosun has already developed a very truly global landscape and covering all these continents. In the process of globalization, there are 2 trajectories. And one is for the China market in development. We acquired global resources and brands and introduced them into the Chinese market, including, Club Med and et cetera. At the same time, and we also have our Chinese businesses going global. For example, for our artemisinin and our pharmaceutical and also our pharmaceutical and the registration and marketing in Europe and America and also for innovative drug and license out, et cetera. Of course, we also introduced the innovative drugs into Chinese market such as licensing, both licensing in and out and also in different business segments for our fashion and also our sports businesses. We have both introduced global brands into China's market and also go global. When we introduce these brands into China, we put a lot of emphasis on our direct contribution. And we have the dual headquarters, and this is also part of the innovative mechanism. And in order to grow rapidly and also about our multiple growth and we are going to emphasize on the marketing products and also globalization and also the ecosystem multiplying. So here you can see by means of the multiply effects, we are going to add more value, and then we are going to contribute to more corporate values. And also for our organization, and we have to ensure the efficiency in order to ensure the multiplier growth, for example, partnership mechanism and incentive mechanism and also the key talent training. And also for our partnership, since 2015 and '16, when we firstly launched the global partnership on the top. And you can see it is deepened. And we have more than 100 global partners, 108 to be exact. And going deeper, we have innovation and also industry segment and the investment and also function line partners and also for our portfolio companies. And we also have the partners for the operation and business units. And we're also trying to optimize this mechanism, and we also have specific requirement. For example, we have a cultural value assessment. This is very important for our partners, then the performance and innovation-driven assessment, et cetera. There are also very clear criteria. And also for the co-creation and also it is very important about the sharing of the benefits and the incentive for the faster realization of evolution, we have short-term, midterm and long term and also by cash and by equity and also multilevel incentives. And we put more emphasis on the short term and the -- incentive should be launched in short term. And in order to retain our talent, we should share more our profit and benefits. And on the top, what we have with the partnership incentive. And also the key -- and talent is also a very important pillar. It is also about how strong we are going to be in the future. And for all these key talents from our new graduates from the universities and these excellent graduates. And step by step, we have set up the development mechanism for key talents. For all these key and excellent talents, from the new graduate and also -- and we have also acquired these entrepreneurs. And we hope that we can then share our development and growth targets with them. And ultimately, and it is hoped that they can become our partners in different levels. And then it is about a greater responsibility, and we hope that we can achieve the common prosperity. And the self-improvement, teamwork and the performance and contribution to society. That is our initial value initiated by Mr. [indiscernible] And even now, these values are very important for our sustainability, particularly. And over the past 3 decades, and we already set up a very solid foundation. And for us, we are more than willing to make more contribution to the society. And in terms of responsibility as a corporation, and we always talk about the sustainability and let's take a look at MSCI rating. And it is also our focal point over the past years. And you can also see the MSCI and we have A rating, HSI A+ and the rating by different international organizations. So we are involved in all these ratings. Our purpose is that when we're involved in this rating, and we can also push forward the upgrading of our corporation. And in different indicators, you can see very good ratings. And when we talk about the carbon neutrality and also the carbon peak and carbon neutrality. And the last year and also this year for Fosun, multiple times, and we organized the workshops to talk about how to help reach the carbon peak and neutrality for Hainan Mining and Nanjing Steel, they have their models and. And for Foliday and also for our pharmaceutical and they have different models. But ultimately speaking, we try to make progresses for carbon neutrality. And we have also set up on our strategic planning for the carbon peak by 2030 and carbon neutrality by 2060. In terms of other initiatives for responsibilities, you can see we are always involved in these initiatives. And since the beginning of pandemic, we are one of the first, probably the first one, and we support the global fight against the pandemic. And in the most difficult time, at the outbreak of pandemic, and we have CNY 500 million medical supplies to be purchased into China and then also these and CNY 300 million medical supplies are urgently needed. And also in the global fight against pandemic, Fosun has also set up a benchmark for the support for the global fight and also in the first place, Fosun is one of the first batch of companies to protect Hainan in the flooding. And also for the Zero malaria in Africa and also for the rural doctors. And we are also engaged in all these social activities. For corporate governance, we promote sustainability, responsible operation, responsible investment and responsible procurement. We have started a ESG commitment in the level of Board level. So that is my presentation. Thank you for listening.

Thank you, Mr. Qiyu. Next now it's the time for management Q&A, and we would like to open the floor to questions, both online and off-line, please.

And we would like to invite our first guest in the first row -- the second one, in the first row.

I am [indiscernible] from Hong Kong, we have focused on the Fosun International for a long time. My question is for Mr. Guo for Fosun, over the past nearly 30 years, particularly over the past 10 years. And in terms of our strategy and also for your evolution and also for your growth, what's your observation? And what's your forecast? And then also, currently? And also going forward, what is your expectation for Fosun International, maybe you can give us some of your idea?

So actually, to you, Mr. Chen Qiyu has already given us the summary. And because in his slide, there is a form. And next year is also a very important year because the next year marks the 30th anniversary of the founding of Fosun. And now we are going to have our own memory. Well, we will continue to look ahead. We cannot just review the history. We are not an old guy. We are still a young guy. We are still a start-up to look ahead. Recently, as mentioned, and we talked about the 30th anniversary. But of course, we want to review what happened, particularly in the past 10 years, and we have both experience and lessons and also achievements and results. And one of the highlights is that we have our footprint now. And we are playing the chess. And now the presence, the layout is already done. Yes, that is our global footprint is already made. And there is also a process of anti-globalization. How about our globalization? But now we have a very strong force of anti-globalization. But now we are taking deep root in China. If we go global, it is more valuable going forward. Because if you can really take a deep root in China and you can also integrate the global resources, there are not many of the companies like this. I think it is a good timing. We want to mobilize our force of globalization to make more contribution to our customers and to the nation. We want to bring into play our globalization to create more value for our shareholders. And next, we have the layout of our industrial operation, we have health and wealth and also happiness and also manufacturing. And we also completed a lot of businesses from 0 to 1, take Yuyuan for example. And like one, bowl of noodle; and two, [indiscernible] and Pramerica, and our health insurance and also Peak Reinsurance. For all these businesses in the past, we made a lot of investments without output. So we did a lot of process from 0 to 1. But starting from now on and now we have started to reap the fruit and create more value for our shareholders. And next, in the whole process of development in addition to the investment on the spirits and liquor, we have also made investments on the turnaround and in order to make a lot of endeavors and for turnaround. So over the past years, and maybe they have not been reflected on the profit in our statement. And we made a lot of investment taken by [indiscernible] and Babytree, et cetera. However, for all these investments in our ecosystem, we have to make these investments, especially if we want to complete FC2M. They are very important vertical sectors. That's why we have made a lot of investments and in terms of also initiatives. So over the past years, we completed the global footprint and industrial operation footprint, and we have also explored our FC2M. And we have done a lot of business from 0 to 1, but now it is the time for fast track and faster growth. So that's why you can see very rapid growth this time. It doesn't mean that we have done an excellent job. But I think that after the years of growth, and of course, everyone is making utmost endeavors and efforts. I think that is also the result of our accumulated efforts and we have already seen the time for fruits. And in the future, we will continue to bring into play our global capabilities and also unleash our capabilities of 4 business segments. And also develop our capabilities of FC2M and make more value for our customers. And we believe that we are going to enter into a stable and also rapid phase. And we will continue to stick to industrial operation and investment. These twin drivers, we will continue to develop our FES system. And Mr. Chen Qiyu already gave us a very good introduction. We'll continue to develop our global partnership system. For corporate growth, Mr. Chen Qiyu also said that the thickness, the robustness of your talent will determine your width and also the height of your corporation. That is about how strong your talent is, of course, we have a very strong talent now, but it's still far from enough, we'll continue to work harder.

So for our second question, well, the gentleman with the glasses.

So what is your take on the future development of your white wine or the white wine market? And also, what is the forecast for the white wine market and also the strategy going forward? And not only the white wine, do you have any future underlying targets to be included in your portfolio, not only the white wine?

So actually, in August, well, we see that the government has a panel discussion with the representatives from the major white wine companies in China. And basically, it's better -- it is to better regulate the white wine market in China and to have -- to step away from the indiscrete investment. Otherwise, there will be unbridled competitions and also this will lead to bubbles in this market. And as we can see that in the future, we will continue to have a very close communications with the government in terms of the policy to align towards the same goal and to put everyone on the same page. And for Fosun Group, well, we are quite upbeat about the market, especially the white wine. Well, basically, we believe it is a very important part of our family reunion and also family gathering. And now Fosun has made investment in Shede and also Jin Hui. And we have a very clear-cut strategy and tactics on going forward. And basically, for Shede, well, of course, would need to be patient to have the good wine, we need to wait. And therefore, for Shede, basically, they will have the more or less the same strategy on going forward and to focus on the products and to focus on the quality of the products. And for Jin Hui, well, first of all, we need to -- well, they are based in Gansu, which is in the western part of China. And for their strategy, of course, we will encourage them to go beyond the original market, to go beyond Western China and to move into other markets and geographies as well. And of course, during the way we will follow-up -- we'll keep a tab on the changing policies and as also strategies from the government. And during the way on going forward, we will, for instance, to -- have to allocate personnel on to Shede and Jin Hui and to encourage an orderly competition in the market.

And now the lady in the first row.

I come from [Mirror] Economic News. And I have a question. So for Fosun Group, could you update us with the information with regards to COMIRNATY and our vaccine?

Well, maybe Mr. Guo can provide some information here.

Why I'm the most suitable person to answer this question? Well, first of all, in the first half of 2021, we have a wonderful performance out of our health segment. Well, it is due to our layout and also business arrangements beforehand. And on way, it is not a smooth ride. However, we charged ahead and we make the investment. We do the cooperation and this laid a solid foundation going forward. And now in China, especially well in our domestic market actually, we really reined in the pandemic. And also for our food and beverage and also for our tourism industry in domestic China, we have a very strong development. And first of all, we need to, well, think highly of the rein-in condition on the pandemic. Well, this provide us with a solid foundation to develop our business. And secondly, not only we contained the pandemic, but also we're the trailblazer. For the Chinese market, we are also the trailblazer in terms of vaccine and also vaccination, and we have several pipelines in sync. Well, now for Fosun Group, we have COMIRNATY. This is the result of the cooperation between us and also BioNTech from Germany. Apart from vaccine actually, Fosun International, we always focused on the drug R&D for pandemic. And for instance, we have the multiple antibodies. And also, we have the small molecule drugs. And also, we have the license in drug -- also in -- licensed out drug for African market and also for Indian market. And regarding the COMIRNATY, clinical trial and also approval, well, actually, we are collaborating with, for instance NMPA and also CDE and also the central government and the Shanghai Municipal Government. Well, the only thing I can say is that we are pressing ahead the vaccine approval and vaccination according to our schedule. So BioNTech yesterday announced that for this vaccine in the U.S., it has gained official approval from the United States government. This is the first one in its kind. And I think this is a milestone for our vaccine. And of course, we are looking forward to gain approval from the NMPA as soon as possible and to launch it into the Mainland China, and we firmly believe in its efficacy and the performance in fighting against the pandemic. So many thanks to our teams and also kudos to BioNTech. And in May 19, 2021, Fosun has already signed exclusive agreement with BioNTech. We will invest in a joint venture company in Shanghai to have a local production and local commercialization going forward. So we are pressing ahead with all the -- with this agenda in a timely manner and according to our schedule.

So the lady -- so the gentlemen in the red t-shirt.