Fosun International Limited (656) Earnings Call Transcript & Summary

Good morning, everyone. Dear investors and analysts and dear friends, good morning. Welcome to Fosun International 2021 Annual Results Announcement. I'm the General Manager of Capital Market and Investor Relations of Fosun International. I'm Sun Lu. And today, we are going to have the online conference. To begin with, I would like to introduce our leaders of Fosun International and Mr. Guo Guangchang, Chairman of Fosun International.

Hello, everyone. I'm Guo Guangchang.

Executive Director, Co-Chairman of Fosun International, Mr. Wang Qunbin.

Hello, everyone, I'm Wang Qunbin. Thank you.

Executive Director, Co-CEO of Fosun International, Mr. Chen Qiyu.

Hello, everyone. I'm Chen Qiyu.

Executive Director, Co-CEO of Fosun International, Mr. Shunjiang Qian.

Hello, everyone. I'm Shunjiang Qian. Welcome to today's conference.

And Executive Director, Executive President, CFO of Fosun International, Mr. Gong Ping.

Hello, everyone. I'm Gong Ping. Welcome.

Dear investors and analysts. And today's announcement, we are going to have morning and afternoon session. In the morning session, it will be presented by Fosun International management regarding the annual results and the strategic development. In the afternoon session and then the leaders from Health and Happiness and Wealth and Intelligent Manufacturing sectors, to share with our investors and analysts in 2021 annual results and future development. And in 2022, it marks the 30th anniversary of Fosun over the past 30 years, and we are resilient. And also, we are going to have accumulated capabilities to power the future. First of all, we would like to invite Executive Director, Executive President and CFO, Mr. Gong Ping to give us the introduction to financials. The floor is yours Mr. Gong.

Dear investors and analysts, good morning, everyone. Welcome to today's annual results announcement. Due to pandemic, it's a pity that we cannot have a face-to-face communication. But we are still very honored and pleased today, and we would like to share with you our annual results, especially our business operation and the strategic development. On behalf of the Board of Directors, I would like to, first of all, share with you the financials in 2021. As we all know that last year for the whole group, and we have successfully addressed the many challenges, for example, the resurgence, both in China and outside China and also the volatility in the capital market and also the uncertainties for the geopolitical situation, we continue to keep on our resilience. And we have already seen the recovery and also the pickup, and we have also set up our core strategic capabilities but with very good results for our strategic growth in 2021, and we have achieved a total revenue of CNY 161 billion, up by 18%. And we have the profit amounting to more than CNY 10 billion. Then for the industrial operating profit. And in total, it amounted to more than CNY 10 billion, up by 30%. Well, in this regard, and I believe that it isn't about our core profitability and also our core competency in terms of the revenue and the profit and also the operating profit, you can see in terms of the CAGR, it is more than 10% in 10 years. And here, I would also like to highlight, not just the financial numbers. At the same time, we also believe that some of the indicators for our sustainability. First of all, it is the total investment of our size and technology innovation last year for the whole group. And in terms of the innovation and R&D and the total investment is CNY 8.9 billion. And in China, we rank [ around 20 ]. Here, you can see that it covers a different industries, health and happiness, wealth and also manufacturing. And we have also reaped very good fruits. Here, you can see we have more than 1,500 authorized invention patents. At the same time, we have more than 500 new products under R&D. And then in terms of overseas revenue and thanks to our globalization and it is also growing dramatically. So you can see the overseas revenue amounted to more than CNY 67 billion covering more than -- or around 30 countries. And here, you can see that we have around 396 million operational members, up by 11%. Of course, for different members in terms of loyalty and also the interaction, et cetera, are still yet to be included. It represents our fundamental. And next, I'm going to share with you more details and also by our 2 CEOs. And also let's take a look at our revenue for our 4 business segments in terms of health, including pharmaceutical, devices, diagnostics and health care services. And also, we have the health, including insurance, asset management, Hive investment. And also Happiness, including brand consumption, tourism and culture; as well as Intelligent Manufacturing. You can see that they have achieved a double increases. It means that on top of the performance in 2020. So here, you can see that the growth rate is more than 20%. And also in the second half of last year and based on the first half of last year, you can also see the growth of more than 20%. It demonstrates that we have overcome a lot of difficulties and forge ahead. So you can also see all these detailed numbers on the slide. Let's take a look at the next slide. So let's take a look at our 5 core subsidiaries. And so for these top 5 contributors, including Yuyuan, Fosun Pharma, Fosun Insurance Portugal, Peak Re and FTG. So they accounted for around 79%. And also for our Fosun Pharma, you can also see the growth rate is 28.8%. And you can see that FTG is greatly impacted by the COVID-19, but they started to pick up last year. And we can also see it grow by more than 31%. And then for Peak Re and you can also see they continued to move ahead. And you can also see that and we haven't seen very high growth of both Peak Re and Fosun Insurance Portugal. And we have also developed some new domains and with very good results and for Easun you can see that they have also kind of growing dramatically by more than CNY 1.5 billion. And then for the Hainan Ming, and they grew by CNY 1.3 billion. And also for time [indiscernible] and they have also improved dramatically by more than CNY 1.2 billion including a [indiscernible] and also for our sports group. And of course, we still have some pressures. For example, for some individual real estate projects impacted by the macro economy overall speaking for the entire group. You can see that in terms of the profit and income on the rise. We still have very steady capital in terms of the debt structure. And in our financial report. And in terms of the active and fundraising [indiscernible] during the reporting period, including overseas syndication loans and amounts to more than CNY 33 billion. And also for the cash and bank balances and term deposit. It amounted to more than CNY 96 billion. We continue to optimize our debt structure. We have the average cost of debt of 4.6%. Here, you can see that we made a further optimization of the cost of debt. And in the previous year, it was [ 4.8% ]. And thanks to a very good share price and also our continued growth and added value for our [indiscernible] operation and at the end of last year. And you can see that our NAV is HKD 28.1, up by 10% versus the previous year. And in terms of leverage ratio, it continues to trend down. At the end of last year and you can see it was 53.8%, down by 0.5 percentage points. And I also believe that we have achieved very good results. And actually, at the same time, we are very keen on the continuous and implementation of financial strategy. First of all, it is the optimization of our data structure and in terms of equity financing and also the transparency of portfolio. And in terms of the capital structure, we have made a lot of efforts. And here, you can see that over 2 years, and we have achieved a very good balance of investment and divestment. And we have already achieved 3 digits for the divestment. And we also encourage our subsidiaries in order to strengthen our capabilities to capture the momentum for M&A. That is the controlling and shareholder, for example, taken the Fosun Pharma, and they have made an upgraded and they have acquired an Antejin 73.01% of their shares, Antejin. And another M&A for our H&A. And also in September last year, they have also acquired another smaller private bank. And on January 1 this year, and the name of this bank is changing to HAL. So here, you can see that they have secured the position in German. And here are some of the examples of R&D and also M&A. So for Mr. [indiscernible] by, our CEO in this sector, you can see a very long list of these upgrading and M&A projects. At the same time, we are also very active in the exit from these nonstrategic and noncore assets. And we have also seen very stable rating from Moody and Standard & Poor. And also in the Europe market, and we are the only Chinese and private enterprise to issue more than [ EUR 1 ] bonds with different maturities. So we successfully issued the first Chinese private enterprise and POE USD bond in Shanghai Free Trade zone. And we also issued a 6-year USD bond with a coupon rate of 5%, which has the longest maturity in the existing USD bond portfolio. And then Fosun Insurance Portugal completed its first issuance of USD 500 million with more than 10-year maturity subordinated capital debt. Then for the equity financing, we have also made a lot of achievements. And you can also see we have been [indiscernible] enhance the transparency of an asset valuation. And for our portfolio companies. And we have more than 160 billion for the book value. And we have also introduced the third-party investor. And then our investors can have a clear picture of our valuation. And take a Sisram Med for example. You can see we issued the private placement in July last year for Fosun Care, we completed the new funding in early 2021. And yesterday, Lanvin Group announced that we have a merger with Primavera Capital [indiscernible]. So it is still in the process. And it is highly expected. Then for Fosun Sports Group, we have also introduced our U.S. investors as well. And also for our JEVE, and we have also completed the new bond of funding. So for our whole group, we are running very stably both internally and externally, in the capital markets, and it is highly recognized in the market. And we believe that we can provide a better dividend for our shareholders. And here, you can see that we -- over the past 14 years, we have a cash dividend amounted to HKD 22.7 billion. The Fosun shares and buyback accounted of HKD 4.24 billion in total after being listed. So here, you can see that our long-term stock performance outperformed the Hang Seng Index and Hang Seng Composite Index and especially last year for the whole year. And in total, we spent around HKD 1 billion to buy back the stocks. So that is also the acknowledgment by our management. So that is the introduction to our financial performance. So for more details, and I think I'm more than willing to answer your questions in the next session. So now I would like to give the floor to our 2 CEOs to talk about our business and also for future growth. So next, I would like to invite our co-CEO, Chen Qiyu.

Thank you, Mr. Gong for your introduction. Now I would like to invite the Co-CEO of Fosun International, Mr. Chen Qiyu to talk about our full business lines. The floor is yours, Mr. Chen.

Now I would like to give you some on our business operation. Last year. First of all, let's take a look at our health business. You can see that we put emphasis on technology innovation, and we also try to build a medical grade and one stop and full scenario health ecosystem, from pharmaceuticals and medical device and diagnostics and health services and our products in 2021 for our core business, for example, for Fosun Pharma. And you can see that they have already achieved more than CNY 38.86 billion, up by 28.8%. And for their new products, and also the revenue accounted for [ 25% ]. And also in terms of the overseas and revenue, you can see that it is also growing dramatically. And then for the medical devices and also for diagnosis, the revenue amounted to CNY 5.93 billion and R&D investment amounted to CNY 4.98 billion, up by 24%. Health services revenue amounted to CNY 4.12 billion, up by 29.8%. So here, you can receive the net profit attributable to the parent, you can see that it amounted to CNY 4.74 billion, up by 29.3%. So the net profit after extraordinary item was CNY 3.28 billion, up by more than 20%. You can see we made a lot of investment on R&D. Thanks to our investment on R&D in the long run, and then we have also started to launch more and more new products and also our innovation capabilities are also improved dramatically. And in 2021 and you can see that the total investments and no worse and more than RMB 4.9 billion. And also, you can see most of them have been invested in pharmaceutical. And also you can see that in our pharmaceutical and the total investment was more than CNY 4.4 billion. And also CAR-T is 1 of our priorities, and you can see that last year, we have launched the first CAR T cell therapy product in China, Yi Kai Da. And then we have already seen more than 100 patients enrolled in the treatment process. And then for [indiscernible], and we have also seen a lot of progresses. We have started the [indiscernible] NDA. And also in September, actually, we have a [indiscernible] the application for NDA for squamous non-small cell lung cancer and also in December, actually, we have achieved the primary endpoint for our international, multicenter Phase III clinical trial for small cell lung cancer. And as of last year, in terms of vaccine and vaccination, we have acquired Antejin, we have Aleph, which is a viral vaccine platform. And now we have the bacterial vaccine and vaccination, R&D and also manufacturing technology, and this is further diversifying our pipeline. And also we have well, as you know, COMIRNATY, which is the mRNA [indiscernible] COVID-19 vaccine. And by the end of February 2022, actually, more than 20 million doses have already been delivered and also administered in Hong Kong, Macau and also Taiwan region. And also, we have 4 biosimilars already launched into the market, for instance, including Han Li Kang and also Han Qu You. They are the leading biosimilars in the market segment. And now let's look at our global operation landscape. As we know that around China last year, actually, our revenue was CNY 13.6 billion. And actually this number in 2020 is CNY 8.19 billion. And therefore, you can see the proportion up to total revenue is 35%. So in the United States, already we have established our segment headquarter and we have capacity there and focus on clinical trial [ authorization ], application and R&D and also marketing. And we have the local team. And also, we have the R&D capability in the North America for medical devices as well. And for -- well, in India, we acquired Gland Pharma, which is an Indian company, and it has 1 [indiscernible]. And as you can see here the number -- well, the revenue has increased by 29.5% year-on-year. And in Africa, we are expanding the market. And for instance, now we own a commercial team about 800 professionals covering 39 countries and regions in Africa. And actually, in October 2021, at [indiscernible], our distribution center was put into operation. And also in Europe and also for instance, in Israel, we also have our own team and we really have a global footprint. So during this pandemic [indiscernible] as United States, and also Pfizer. Well, they have reduced or they have come up with [ oral medicine ] and for Fosun Pharma, already, we have again, authorization from MPP for the manufacturing of oral medicine. And if we look at our pharmaceutical revenue structure, actually, it is optimizing in the past several years. And for instance, well, as you can see, for our new and also recently launched products accounted for more than 25% of the total revenue at pharmaceutical segment. And also for the COMIRNATY already the doses has surpassed 22 million. And also, our rituximab, the revenue was CNY 1.69 billion, with a 125.3% year-on-year increase. And also for our [indiscernible], our Han Qu You, our revenue is RMB 930 million. And also, it is the first biosimilar approved by China and other Europe. And also for avatrombopag already has successfully included in China's National Medical Insurance. And currently, the sales revenue is CNY 430 million. And also for Gland Pharma, increased to 29.5% as I've talked about. And as for our medical devices, it is on a steady and a stable growth as well. So if we look at our medical cosmetology, the core company here is Sisram Medical, which is a Hong Kong listed company. And also, it has achieved a 22% growth last year and in both profit and also revenue. And it is increasing its capability in medical cosmetology and also it is expanding into, for instance, of consumables. And for instance, like the long-lasting botulinum toxin and also, it has the household beauty apparatus. And also in terms of professional supplies, we have Intuitive Fosun, which is a global leader in surgical robotics in a joint venture. And last year, if we look at the Da Vinci installation, actually, it is -- in total, we now have some 73 units of installation and also we have an increase of 18 units year-on-year. And for Chindex Medical. Well, it has exclusive licensee of a product of many large multinational companies. And also it is collaborating for instance, with our domestic companies [indiscernible], for instance, the novel emergency medicare platform. And also, for instance, the mobile ambulance and also the mobile diagnosis treatment platform. And also the specialized vehicles with different types of treatment and equipment on board. And Breas is also doing a very good job. And also, for instance, for our Fosun Diagnostics and actually, it has acquired 58.67 equities of Abcarta and it has covered for instance diagnosis and also biochemical microbial diagnosis. And on going forward for our health services, we focus on model innovation. And it is based on our off-line hospital and also [indiscernible] networks, especially in the [indiscernible] delta and also the Greater Bay Area and [indiscernible] delta. And we have a very sophisticated offline network already in place. And also, we have the online services. So now we are trying to combine the online with the offline. So we already upgraded our Fosun Healthcare into Fosun Health Products. And in the future, we like to produce -- to provide the closed loop and also one-stop platform to provide health services and also care services for our family clients and continue to build up our core competence. And in -- and also in terms of the growth rate, it has 30% and also, for instance, we have acquired a new hospital in the Greater Bay area, the third affiliated hospital of [indiscernible]. And also, we are building our [indiscernible] insurance process services. And now I try to switch gear and to talk about our happiness. And in terms of Happiness, we focus on our family clients and also to provide them with enhanced experience and also to build our globalized and industrial ecosystem. As you can see here, you saw the dashboard. The total revenue is CNY 66.9 billion and was 19.4% year-on-year and Yuyuan, its revenues CNY 51.06 billion, 12.2% year-on-year. And for FTG, it's CNY 9.26 billion and also revenue increased by 31.2%. For Fosun Sports, CNY 1.6 billion, 20% year-on-year. And Baihe Jiayuan, CNY 1.41 billion and also was 25% year-on-year. And for Yuyuan, it is on a steady and is a stable growth path. It's revenue has been grossed by 12.2%. And for the profit attributable to the owners of the parent, it is an increase by 6.9% and to CNY 3.86 billion. And also, if you look at our 2021 revenue breakdown, well, or the well -- the consumer industry, it is 64.7%. And also for the fashion and also jewelry and it has increased [indiscernible] and they had accounted for 83.0% and also for the [indiscernible], it is more than 600. And last year, I think, it's 602 and also lost [indiscernible], Also it is increasing rapidly and also for the profit is CNY 1.2 billion. And for the [indiscernible] and for the [indiscernible] has a year-on-year increase of 28.3% and also profit increased by 53.1%. However, in the fourth quarter, well, it is core market [indiscernible] the pandemic it has built. However, still, if we look at the total 1-year development, it still did a very good job. And also for [indiscernible], well, last year, we see the pandemic, well, is subsiding and it has enjoyed a very strong rebound. And if you forecast its revenue, it has CNY 9.26 billion. That is a 31.2% year-on-year increase. And for the adjusted EBITDA, actually, it has achieved CNY 810 million of EBITDA in the first -- in the second half of 2021 and the [indiscernible] has enjoyed a strong rebound in the second half. And also for the Club Med, well, actually, it has the 2020 to 2024, we plan to open up 17 more resorts and [indiscernible] in the next 3 years. And therefore, on this strong rebound basically, it comes from [indiscernible] open in the overseas market. And therefore, in the second half of 2021, we can see year-on-year growth for [indiscernible] 180% and for Sanya Atlantis, it has more than 18% CAGR growth and also it has CNY [ 1.31 ] billion. And also, we have recombined consolidated and we have we have moved it online and it has gained great exceptions as well. And if we look our sports and for our wedding businesses, for instance, Lanvin group. While the revenue has increased to 23% and the Lanvin, the core brand, it has achieved 103% year-on-year increase in Greater China region, it has increased about 122%. And also, we have acquired the [indiscernible]. And [indiscernible], well, for the Lanvin and also for [indiscernible] company, they were listed into the New York Stock Exchange [indiscernible] and also for [indiscernible] has achieved the turnaround and also has acquired new brands like [indiscernible] and also for our Sports and wealth actually [indiscernible] pace. And in terms of wealth, Well, wealth is one of our core businesses. It's insurance plus asset management to increase our return on investment and also to create our ecosystem. So we divided it into insurance and asset management. Well, the total revenue is CNY 43.7 billion and 2.8% year-on-year increase. And also, the profit to shareholders is CNY 5.16 billion year-on-year of 13.5%. [indiscernible]. Year-on-year increase by 38% and EUR 4.91 billion of income. And HAL, it's a 32% year-on-year increase and also EUR 300 million revenue, and these are the dashboards for wealth. So now I will zoom in and look at Insurance. So [indiscernible] actually has achieved RMB 60.2 billion and also the investable assets at CNY 1.7 [ trillion ]. And actually for the [indiscernible] they enjoyed a very strong track record last year and also has a 15% increase in the profit attributable to shareholders. And also, they have achieved very good matchmaking with our in-process and [indiscernible] in terms of payer and also health payer. And in terms of our investment, asset management, the AUM, as you can see here, is RMB 1,803 billion. And also, we have been the license, not only in China but also in Europe and also, for instance, in Brazil and in other places in other regions, this shows our globalization and also in terms of Hive management, and we have the twin driver as Hive and [indiscernible]. So domestically, as you can see here, our total asset is CNY 433.4 billion. And also our domestic investment is more than CNY 15.14 billion. And for the overseas Hive, AUM is CNY 14.43 billion. So now let's look at intelligent manufacturing. And here, we have a smart intelligence, intelligent manufacturing. And also we have the green resource industry. And for instance, we have the digitalization and also environmental protection and also industrial IoT and et cetera, and also smart mobility. As you can see here that total, well, the profit attributable to the parent shareholders is CNY 3.58 billion with a year-on-year increase of 70.1%. And for NISCO, it's revenue CNY 75.67 billion year-on-year increase of 42.5% and also in terms of profit attributable to the shareholders, the year-on-year increase is of 43.8%. It's a very amazing performance. And as you can see, the advanced steel, actually, the product has accounting for the 17.4% of the total revenue. And also, it has 65 products. And for instance, like anti-crack steel and also structural steel. And also for our [indiscernible] product in Indonesia, it will be a new revenue for our future development, and also we have invested in the Wansheng which is a flame retardant. And also for Hainan Mining, its total revenue is CNY 4.12 billion, 49.0% year-on-year increase and also profit to shareholders is RMB 870 million and with a year-on-year increase of 513.6%. Hainan has reduced its procurement cost and investment in the [indiscernible] and also, it has developed 2 high-yielding wells. And therefore, while it is ready around the way for commodities and achieved a high growth rate in profit and also in revenue. And for Easun Technology and JEVE Power, you can see how they have developed rapidly throughout 2021. And the next one, this is the dashboard for it. So since 2015, 2016 till now, we have achieved a turn around. So now the revenue is a [indiscernible] and it shows our traction, it shows our core competency and also potential for profitability and also [indiscernible] environmental protection to lower the energy consumption and also lower emissions. And we'll continue to make outward investment and to make our way into new materials. And also, this is the dashboard for Hainan mining. Revenue and profit has significantly increased. And basically, it is a [indiscernible] management and to further stabilize the profitability and also shore up the profitability significantly. So we used the strategy called the resource plus finance and also we make our way into the new energy industry and this laid a solid foundation for the Hainan mining into the future. So apart from this call and also Hainan Mining, intelligent manufacturing will have some unlisted companies. And for instance, as in case in here, we have [indiscernible], well acquired the company. It is a leader in the fire retardant globally and it's deeply rooted in China and serves the global market. And its net profit is CNY 800 million to CNY 850 million and also with a year-on-year increase up to 116%. And also for BESINO Environment, it has also gained a lot of traction in the past several years. And you can also see that the contracted a scale of more than 6 million tons for the treatment. And they're also developing some new projects. Then for Easun Technology and then Shanghai Easun technology acquired over 100% equity of FFT in May 2019 and also has the world's leading intelligent manufacturing solution service provider. And previously, they served a lot of auto industry, and we have also completed the head office in Shanghai as well beyond the automotive industry. They are going to move into other domains as well. Then for JEVE, and it is also one of the leading new energy producer. And in order to provide new products and also we are dedicated to provide the new energy solutions. And currently, capacity is 4 gigawatt. And also 22 gigawatt capacity is under construction. So that is our full business and the sectors. Thank you for your listening.

Thank you, Mr. Chen. Next, we would like to invite the co-CEO of Fosun International, Mr. Xu Xiaoliang to share with us the strategic development. The floor is yours, Mr. Xu Xiaoliang.

Dear investors and analysts, good morning. Now I would like to share with you some of our plan for our strategic development over the past 1 year impacted by the pandemic. We can see that it is still persistent. So we have seen very complex and volatile environment. We have seen both opportunities and challenges. As mentioned by Mr. Guangchang Guo for Fosun International and with our very stable performance results. And we have demonstrated our resilience and also capability and against the risk in 2022. And it marks the 30th anniversary for Fosun. And we feel most happy is that we would continue to make contribution to the society, and we would like to continue to serve our global families. And we really would like to create happier life for families in the world. In order to have an ecosystem for both wealth and happiness and wealth over the past 3 decades. There are also a lot of changes in addition to the market size and also the number of our employees and the business coverage. And we have different priorities in different stages. For example, from investment layout to twin driver and then from China momentum, connecting global resources and 2 Global Plus and China 2-way empowerment. Ultimately speaking, these transformations are going to stay true to original aspiration and mission. While we are changing our tactics, Fosun has also come up with 4 engines and that is FC2M Ecosystem and the FES system, globalization and innovation driven. So these are the propellers for Fosun International to achieve the current results. It is also the guarantee for continued high growth. And last year, Fosun International has identified based on 4 core engines for our future strategic development. So today, I would like to give you more elaboration on these 4 engines. To begin with, and we are going to build our FC2M ecosystem. And we want to have the integration between [indiscernible] and also the link starting from the clients' needs, then we want to make them happy. And on a sustainable way, we want to provide good products and services for them. And for F so it is about and Fosun and family. So that is an F for Fosun. You can see that our ultimate goal is to serve the global families with different structures. And then for the C end, and there are 2 dimensions. One is our client as members, and that is systematic membership. It means that we have to operate our clients as our members in order to provide the best-in-class products and services. At the same time, we have to have a different in classification from members for consumption and for employees, for corporate members, and we can continue to provide innovation in order to make them happy and satisfied. At the same time, until [indiscernible] entries to these or access to these members and will also be interconnected with each other. Therefore, the M end that is about innovation and R&D. Over the past years. And you can see that -- and we have already come up with some good products. And for example, and [indiscernible] has also grown by 126% amounting to more than 1.6 billion are the new opportunities for the patients with cancer. And also our CAR-T products have also been listed. And in the commercial and also the universal insurers and then for America and also Fosun Care has also launched the high-end senior care insurance. And then we have also have a better supply chain and flexible control. And we want to make sure that we can have a breakthrough technologies. And the flexibility means that it is more customized and also elastic production and ordering system. And therefore, the FC2M. And you can see that we have launched the 2 membership systems and the Fosun Health and Fosun Alliance step-by-step. And these different platforms and the scenarios can be integrated together with all our members and just within half a year and we have already launched more than 15 brands from 35 industries for Fosun Alliance and 20% of our active members can choose from this and Fosun Alliance. In terms of globalization, and we are the practitioner and also the beneficiary of globalization. Over the past 3 years, you can see we continue to upgrade our globalization capabilities. And here, you can see for both globalization and localization and we have been seeing new engines. And by the end of last year, the sales revenue from overseas countries in the regions and accounting for 42%. And we have our business coverage in around 30 countries in the regions and the total revenue of China [ global tooling empowerment ] is more than CNY 10 billion. So here, you can see we have both existing growth, for example, H&A acquired bank. So it consolidated its position in Germany. And Lanvin group has also acquired [indiscernible] from Italy, and we have seen the growth from 0 to 1. And then [indiscernible], and it has also set up in Indonesia coke production base. And in terms of the globalized capital and market financing and just now our 2 colleagues already mentioned that Lanvin Group in 2021. And also this year, I've also made the new announcement to be listed in the New York Stock Exchange. And then also Fosun Hive Singapore Capital Management Center was also established to connect with global capital and empower the domestic and international hive projects. And we have also seen R&D is also improving for example, for the Fosun Pharma, we have also achieved the American authorization. So you can see it is also highly acknowledged in the international communication. Zoom in the scientific and innovation for Fosun. And we also dedicated to scientific innovation last year, and we invested in CNY 8.9 billion for the innovation in order to empower our multiplier growth. At this moment, we have more than 1,500 licensed patents. And at this moment, we also have more than 500 R&D products and in major cities and across the world, and we have also set up a different R&D center. And in order to deliver our core technologies for example, the first and the biosimilar and also the first in the CAR T therapy in China. And then not long ago and after the Beijing Olympic Games and the special weather [indiscernible] and hasn't been used in Beijing Winter Olympic Games. Next page, Fosun until now in terms of industrial operations and also investment there are a lot of success stories. But at the same time, and we didn't really have very good summarization of our experience. Step by step, we have developed this in FES. Fundamentally speaking, we want to have a customized management system to go forward to this thing is also our experience of best practice of Fosun over the past 3 decades. And we hope that we can continue to power our high-speed growth. Here, you can see that we have a multiplied growth and also entrepreneurship ecosystem growth, lean operation and risk management for these 5 modules, and we have developed more than 100 professional tools. And also more than 50 core enterprises have launched their various talent programs. It is then translated into practice. And on an ongoing basis, we will become our engines. And we will continue to summarize our experience and continue to evolve our FES. So let's also take a look at our ecological organization. And in order to implement the strategy and we need to have the guarantee from our organization to set up a system and we need to have a 3-dimensional organizational structure over the past 1 year. Here, you can see we have upgraded our organization structure. And we have our full committees: overseas operations, science technology innovation ecosystem and FES committees in order to better and build and also facilitate our core engines. And based on this on top of the management committee, and you can see we want to fully stretch ourselves vertically, for example, really. So you can see that we have vertical business, including business units; and for horizontal, and we have now general business competitive. We also have functional back office in order to support both the vertical and horizontal business. With this structure, let's also take a look at our lineup, and in this ecosystem and for different dimensions, and we need to have the partners with entrepreneurship and a different node. And then they can also be fully integrated to each other. And you can also see that currently, we have more than 140 global partners and then also 240 industry partners and 350 functional line partner and 30 innovation partners. And we hope that in the future, we can have 300 global partners. And then it is a believed that with the leadership by all these partners, we can have better synergies. And also let's take a look at our key targets in addition to our partners. And in order to improve our fighting spirit, we also have to ask the team with financial entrepreneurial spirits for our key talents and in different positions and the domains, and then we can capitalize on and maximize their values, for example. And we hope that we can have more than 3,000 future entrepreneurs in the mid-tier. And we also need to have 30% of the young talent in order to be more sustainable. We also need to have more than 100 top scientists in the Fosun ecosystem in order to improve our innovation in science and technology and then also in order to synergize and energize our system. And based on the current system and in terms of the goal-driven mechanism and the battle assurance and talent development, we have upgraded our mechanisms. For example, we have 1 plus 2 plus 7 strategic planning mechanism and also 361 multiplier growth. So that is the goal to achieve 30%, 60% or even 100% for different portfolio companies. We also have the dual-tracking mechanism for KPI and OKI. So we have a very clear and also very transparent target. And at the same time, we have dynamic authorization mechanism in order to make sure that we can ensure that these programs and procedures can be implemented smoothly. And with a holistic talent development mechanism, we hope that we can improve their morale. For example, we have a rotation system and also have a different dimensional partnership mechanism. So they can also be promoted or demoted. We want to have a very sound cycle for talent. At the same time, we can also push forward the core business and also core talents. So next, let's take a look at the corporate culture. And the enterprise is the tree, and the culture is the root. And for our strategy and over the past 3 decades, that is always about the self-improvement, teamwork, performance contribution to the society for the past year. And we would like to continue to do the aiding and that we have to bear in mind, the customer is always the priority. That is also our original aspiration. So we also put a lot of emphasis on the ESG. So you can see very good results in terms of the environment. And based on the national carbon-neutrality strategy, we set up our Carbon Neutrality Committee to help our member companies to define the strategic responses to carbon neutrality, and we want to achieve carbon neutrality by 2050 and also carbon peak before 2028. And we continue to launch our rural doctor project until the end of last year, and the rural doctor project has already covered more than 70 countries in China and helped more than 24,000 rural doctors. And then we have also launched more than 200 million artesunate injections to help our kids and also the people in Africa. And also we are fighting the epidemic, both in China and outside China. And you can always see our humanitarian measures and the projects. So that is about the spirit of ESG, which is implemented across the group. And with the ESG guidelines, it will be embedded in our development for our ecosystem. And you can also see some of our results of ESG, which is in all ways acknowledged by the capital market and the rating agencies. So in terms of the MSCI ESG Rating, and you can see that it has been increased from under 3b to 2a the last year. And also for the Enhance Corporate Sustainability benchmark and the Hang Seng Index and also FTSE/Russell, you can see that our rating on ESG is continuing to grow. So here, you can see what we have done in terms of strategy and corporate governance. Here, I would like to thank you all once again because due to the pandemic, you are still with us for our online announcements. And I think for our investors, thank you so much and for your consistent support and also the support by and people from all walks of life. And thank you for your support. We can continue to grow over the past 30 years in order to create happy life for the global families. That is the mission for all Fosuners. I think including the families and for all our investors and as mentioned by Mr. Guo in his message in the shareholders letter. And actually, no matter what is happening, and this is our permanent pursuit for a happy life, the essence. And what we are going to do in Fosun is to deliver more work and love to the society. And happiness, maybe it is about the happiness and health and also wealth, but it is a very abstract idea. But we believe that in the wave of the Fosun industries. And we can see more tangible and happiness. Maybe it is in the Club Med and travel or maybe it is just a [indiscernible] and at a restaurant or maybe it is the Yescarta therapy or maybe it is a train ticket and whole of the Hangshaotai railway. So we believe that at Fosun, that is a look of happiness in the next 3 decades. So we will continue to strive for our global families. And thank you for the presentation. So now I would like to open the floor for questions.