J&T Global Express Limited ($1519)

Good day, and thank you for standing by. Welcome to the J&T Global Express 2025 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Haibin Chen, Director of Strategic Investment and Capital Markets. Please go ahead.

Thank you, operator. Hello, everyone. Welcome to J&T Express 2025 Earnings Conference Call. I'm Haibin Chen, Director of Investment and Capital Markets of J&T Express. The company's results and Investor Relations presentation were released earlier today and are now available on the company's IR website at [indiscernible] we would like to remind you that the call may include forward-looking statements, which are underlined by a number of risks and uncertainties and may not be realized in the future for various reasons. Information about general market conditions are coming from a variety of sources outside of J&T. This presentation also contains unaudited non-IFRS financial measures that should be considered in addition to, but not as a substitute for the company's financials to be paired in accordance with IFRS. I have with me J&T Executive President, Stephen Fan, Vice President, Junyi Hou and CFO, Dylan Tey. Our management will share our strategy, operating highlights and financial performance for 2025. This will be followed by a Q&A session. Please be noted that we have [indiscernible] Side shown through website -- webcast this time. With that, let me turn the call over to Steven. Steven will go through his prepared remarks in Chinese, before I translate for him in English.

[Interpreted] Hello, everyone. Welcome to today's results conference. On behalf of the company, I would like to sincerely appreciate your continued interest and support. It is my great honor to report to you on our group's operational and financial performance over the past year. In 2025, the company achieved an expiring performance growth across global markets. In Southeast Asia, parcel volume growth reached a 4-year high with a significant increase in market share. Our China business made a progress with improvements in both efficiency and service quality. Meanwhile, our new markets business experienced accelerated volume growth and achieved a turnaround from loss to profit in adjusted EBIT for the first time. [indiscernible] and evolving market landscape, the company has fulfilled its growth commitments through steadfast high-quality growth. Internet-wise, the company handled 30.1 billion packages, representing a year-on-year increase of 22.2%. Revenue reached USD 12.2 billion, representing a year-on-year increase of 18.5%. With the contribution from non-China business, continuing to rise [indiscernible] High, the adjusted net profit amounted to USD 430 million, representing a significant year-on-year increase of 112.3%. Next, I will provide an overview of the development of our business across different regions. Firstly, Southeast Asia, in 2025, the company handled 7.7 billion parcels in Southeast Asia, representing a year-on-year increase of 67.8%. Our market share reached 34.4%, representing a year-on-year increase of 5.8 percentage points, maintaining its absolute leading market position. Revenue reached USD 4.5 billion, representing a year-on-year increase of 39.8% and adjusted EBIT was [ USD 540 million ], representing a significant year-on-year increase of 77.5%. Our rapid profit growth in Southeast Asia is primarily distributable to the foreign factors. First, effectively capitalize on the growth opportunities from e-commerce and grew rapidly with our customers. The company continues to increase its restructured investment in Southeast Asia to enhance transportation capacity and sorting efficiency, thereby ensuring [indiscernible] Network operations even during peak sales period, our superior fulfillment capacities have earned the trust of e-commerce customers. At the same time, the company continued to improve express delivery services to the increasing demand of consumers as evidenced by solo reductions in average delivery time and sustained decline in loss parcel rates in 2025. Second, our operational efficiency improvement and further cost optimization achieved a mature cycle by consistently transferring China's refined operational experience to Southeast Asia. Our cost per parcel in Southeast Asia decreased by 16% year-on-year in 2025. We have shared the results of cost efficiencies with our customers and create a positive flywheel of cost optimization, business growth further cost reduction, enabling us to capture increment volumes while fostering a mutually beneficial [indiscernible]. Third, we successfully expanded our base of nonplatform consumers, driving rapid growth in parcel volumes, non-platform parcels have become an important supplement to our diversified business scenarios. We actively expand serve customers on social media. Online business of [indiscernible] Stores, branded customers and individual parcels. With customers offer higher margin thereby optimizing our customer structure and enhancing our profitability. Secondly, China in 2025, the company handled 22.1 billion parcels in China, representing a year-on-year increase of 11.4%. Our market share reached 11.1% [indiscernible] EBIT amounted to USD 94 million. In response to the changing market environment, we proactively adjust our strategy to meeting profit resilience. First, the company actively responded to industry initiatives in at curbing capital competition and was committed to continuous improvement of service quality and transition from price-driven competition to value-based composition. The company further shortened the average delivery time and increase the proportion of same-day and next-day deliveries. The company continued to enrich its product offering by introducing value-added services tailored to customer needs, expanding its cloud warehousing services, enabling greater coordination between warehousing and distribution and optimizing warehousing and distribution fulfillment timings. Second, the company deepened the penetration of this delivery network into rural areas to enhance the delivery experience for consumers in these regions. The company actively assists e-commerce platforms in developing rural delivery services which currently have been formally launched in 12 provinces. Our coverage rate of express delivery to villages continue to increase, ranking among the top in the industry. At the same time, the company saw delivery difficulties of agricultural products in rural areas through a variety projects to exist farmers in fusitating the agriculture products [indiscernible] Third, we will continue to optimize costs with the cost per parcel decreasing from USD 0.30 to USD 0.28 in 2025. Our Guangzhou [indiscernible] Sorting center, our largest self-built logistic hub in the world officially commenced operations in the first quarter of 2025, with daily processing capacity exceeding 15 million parcels, further optimizing the sorting and transit efficiency across the Grade Bay area, a critical logistic region by continuously benchmarking against the most efficient peer companies in industry and learning advanced management experience and technology. The company remains confident in further optimizing cost for pace. Lastly, new markets. In 2025, we had 400 million parcels in the new markets, representing a year-on-year increase of 43.6%. Our market share reached 7.5%, representing a year-on-year increase of 1.4 percentage points. Our adjusted EBIT in new markets achieved a turnaround from a loss to profit in the year, making a significant development milestone. This achievement was attributed to our transfer of operational expertise in China and Southeast Asia to new markets, investment in automated sorting equipment, optimized route planning, enhanced last mile pickup and delivery efficiency, effective climate with rapid growing local demand and improvement of overall network efficiency. [indiscernible] A confluence of high GDP, strong per capita consumption and low e-commerce penetration, making it the Blue Ocean market with immerge potential. In 2025, a number of global e-commerce platforms further expanded into Latin America and promoted its cross-border e-commerce market into a new phase of development, which also brought more growth opportunity to express delivery companies leveraging its extensive network coverage and superior service capabilities, the company continued to deepen cooperation and track with cross-border customers while actively expanding its partnership with leading local e-commerce platform. By capturing the rapid growth momentum of the e-commerce and express delivery in [indiscernible] the Latin American market is expected to maintain rapid expansion in the coming quarters and emerge as a pivotal engine of J&T's global growth. We are confident in the future growth potential of new markets. Looking ahead, we will continue to strengthen investment in global network infrastructure and export China's mature operational systems and refined management expertise. Last comprehensively upgrading network capabilities and customer experience, guided by our well-defined long-term global competitive strategy, we will ride on the kind of e-commerce globalization to deepen our presence in core markets expect incremental opportunities in overseas markets, enhance network efficiency and brand image and steadily enforce our core competitive barriers. The year 2026 marks the commencement of J&T's new decade. We will continue to unite our efforts to move forward steadily strive for excellence, exceed ourselves and embark on a broader global journey. In the future, we will remain committed to innovation and prudent operations. create long-term corporate value and write a new chapter of high-quality global growth. Thank you for your support. Now I would like to invite our CFO, Dylan, to integrate the financial data of our annual results.

Okay. Thank you, everyone, for the call today to joining the call today. This is Dylan, I will take you through our financial highlights. Before I start, Note that unless specifically mentioned, all the figures are in U.S. dollars and percentage changes are on a year-on-year basis. Detailed financials, including our financial performance metrics, unit economics, cash flow, capital expenditures are available on our IR website. So here, I will only focus on the key financial highlights. For J&T Express Group overall, we are pleased to report that our group's total revenue increased by 18.5% year-on-year, from $10.3 billion in 2024 to $12.2 billion in 2025. Core express delivery revenue grew by 18.3% from $10 billion to $11.8 billion. This growth was primarily driven by strong parcel volume growth in Southeast Asia and our new markets. We successfully captured the opportunities arising from the globalization of e-commerce with the revenue contributions from Southeast Asia and new markets, rising meaningfully from 37% in 2024 to 44% in 2025. Total gross profit for the year reached $1.46 billion in 2025, representing a year-on-year increase of 35.7%. Gross margin improved from 10.5% to 12%, up 1.5 basis percentage points. Importantly, with our new market segments achieving positive adjusted EBIT for the first time, the group adjusted EBIT reached $566 million, up 87.9% year-on-year. Adjusted net profit amounted to $425 million, more than doubling from $200 million in 2024, demonstrating a significant enhancement in our overall profitability. Next, let me walk you through our segment results one by one. First, Southeast Asia. Revenue in Southeast Asia increased by 39.8% year-on-year from $3.2 billion in 2024 to $4.5 billion in 2025. Gross profit rose from $633 million to $861 million. Our adjusted EBIT grew from 77.5% year-on-year from $303 million to $538 million, with adjusted EBIT margin improving from 9.4% to 11.9%. This reflects our continued ability to enhance profitability. We shared the benefits of costs, which help us continuously gain market share. The strong parcel volume growth, in turn, brought further economies of scale, enabling our Southeast Asia to maintain a healthy and sustainable unit EBIT. Next, let's move to China. China is a dynamic market. We proactively adjusted our competitive strategy as always. Revenue grew by 5% year-on-year to $6.7 billion. Revenue per parcel declined slightly from $0.32 to $0.30. Price competition was intense in the first half of the year with the support of the industry's involution policies, pricing stabilize and recover in the second half. On our cost side, in China, cost per parcel decreased from $0.30 to $0.28, benefiting from improved efficiency, greater network stability, continued capital investments, including self-owned line hauls, vehicles and automation in our sorting centers. So amidst the complex and challenging market landscape, our China business maintained solid profit resilience. The segment recorded an adjusted EBIT of $93.9 million in 2025, to $147.2 million in 2024. Looking ahead, as the industry and evolution policies continue to deepen and as we further enhance our service debt that and geographic coverage to strengthen partnerships with all our customers, we are confident that the profitability of our China segment will maintain its resilience going forward. Now turning to new markets. We are delighted to share with you that in 2025, our new market business achieved positive full year adjusted EBIT for the first time. This is an important milestone for us. Revenue in the segment grew by 51.2% year-on-year from $576 million to $870 million. Our gross profit in the new markets increased more than 4x from $30 million to $148 million. Adjusted EBIT turned from the loss of $76 million to a profit of $4 million, with the margin improving from minus 13.3% to plus 0.4%. Revenue per parcel in the new markets rose from $2.05 to $2.15. This improvement was primarily driven by our ongoing business development across the countries where we have been very actively acquiring higher-value customers and dynamically optimizing our parcel volume mix. Cost per parcel for new markets declined from $1.94 to $1.79, benefiting from the targeted and efficient capacity investments as well as our team's refined operational management, leveraging off our experience gained from China. The advanced technology from our self-developed equipment companies, our valuable overseas expansion experience in Southeast Asia. And our mature operational system from China. All this helped to support our rapid development in our new markets. We remain very optimistic about the future potential here, as mentioned by Steven. Last but not least, our cross-border business. Following 2 years of business optimization and focus on the B2B sector, profitability continued to improve. In 2025, cross-border achieved positive full year adjusted EBIT for the first time. Revenue increased slightly by 2.1% year-on-year from $74.5 million to $76.1 million, remaining largely stable. Adjusted EBIT turned from a loss of $39 million to a profit of $4 million, with adjusted EBIT margin improving significantly from minus 52.7% to plus 5.2%. Finally, let me return to our consolidated numbers. Combining all the factors outlined above, our adjusted net profit reached $425 million which representing a 112% increase from last year. That's non-GAAP. On a GAAP basis, our net profit for the period was $225 million, up 98% from $114 million in 2025. As you can see, these are clear demonstrations of our improved bottom line performance. Turning to our cash flow. We recorded a net cash inflow from operating activities of $1.09 billion in 2025, growing 34.8% year-on-year compared to $807 million in 2024. If we deduct our capital expenditure, our free cash flow as a group reached $494 million in 2025, representing a 96.1% year-on-year increase, from $252 million last year. This is our record. This improvement highlights potential and enhanced cash generation capabilities. So as of December 31, 2025, we maintained a very solid cash position with total cash and cash equivalents, restricted cash and bank wealth management products amounting to $2.2 billion, up 31% from $1.68 billion at the end of 2024. Thank you all for listening to my remarks on financials. This concludes my prepared remarks. Thank you.

Thank you, Steven and Dylan. We are now ready to open the call for questions.

[Operator Instructions] We will now take the first question from the line of [indiscernible] a from Cheng Yang Securities.

[Interpreted] And then let's translate my question one, our parcel loan growth in Southeast Asia accelerated in the second half of 2025 compared to the first half. Can this accelerating trend be sustained into 2026 and how we expect the pace of our market share gains in Southeast Asia going forward? Question two, what's the current status of non-platform business development in Southeast Asia?

[Interpreted] I'll translate for Charles. Thanks for the question. For your first question, I think Charles response is that speaking on behalf of our company, we believe that the South Asia e-commerce sector is in a very rapid penetration stage of growth. Major e-commerce platforms, as you know, they are significantly ramping up their investments across this region to further enrich their product offerings, customer shopping experience, and this drives very strong volume momentum for us. According to industry reports, the Southeast Asia e-commerce market is projected to maintain a high CAGR of 15% to 20%, from 2026 to 2030. So placing our express industry there very firmly on a very high-growth trajectory. J&T, we continue to scale up capacity investments in the region, Southeast Asia region, growing alongside our e-commerce customers. And at the same time, as mentioned in your second question, we are actively developing non-platform business, which includes social cost and also includes individual customers, which have made -- we continue to make -- or which has started to make meaningful contributions to our overall volume growth there. So in 2025, Charles added that our market share in Southeast Asia has reached 34.4%. This is an increase of 5.8% compared year-on-year. As you know, as you guys are our old friends, you guys know we continue to transfer our -- to replicate our China leading experience of operational expertise into Southeast Asia. We believe that by leveraging our robust network capabilities, our high-quality service and our competitive pricing will be able to capture more market share. And we are confident that in our ability to deliver our Southeast Asia market growth. That's your first question, [indiscernible]. Okay. I will -- the second question you asked development of non-platform business in Southeast Asia. So Charles commented is, of course, other than e-commerce, we continue to actively develop non-platform customers, which include our social commerce as well as B2B customers. While the absolute contribution from these non-platform customers have increased. Their growth rates currently still lags behind that of the e-commerce volume because the e-commerce is obviously growing a lot faster. As a result, the non-platform business as a whole, it is still growing, but it's not growing as meaningfully in our total parcel volume compared e-commerce. From a total profitability standpoint, our non-platform customers command higher margins and their profit contributions continue to grow, which is -- which meaningfully outpaced their share of the total volume. So obviously, Charles added that are building a strong base of non-platform customers requires substantial time and effort and accumulation and expanding our non-platform segments will remain a long-term and strategic focus for our operation in Southeast Asia as well as new markets in China. In Southeast Asia, we have already secured brand name customers across verticals, including 3C, i.e., Consumer Electronics, Apparel, [indiscernible] and we continue to broaden and deepen our partnerships with both local and international customers, including, but not limited to the small and medium enterprises as well as individual customers. So that concludes his answer to your second question.

We will now take the next question from the line of [indiscernible] from Morgan Stanley.

[Interpreted] Congratulations to the very strong profit growth as well as free cash flow. I have 2 questions. The first question is about the global expansion strategy. So what's the company's current plan of the business expansion globally, especially considering the most recent geopolitical tension in the Middle East. Do we have any updated plan in entering new markets in new countries? And number 2 is about allocation. So we are very encouraged to see that overseas market is a strong growth driver for our businesses. So do we have any updated CapEx plan going forward for the next 2 to 3 years, breakdown by different regions?

[Interpreted] I'll translate for Stephen for this question. So regarding this question, I think Steven mentioned that it's now becoming very clear for us. The globalization of e-commerce players obviously have deepened in the recent years. With platforms such as TikTok, Temu, Chain, Ali Express, they steadily expand their international footprint. This has driven has driven a lot of demand for high-quality and last-mile delivery network, creating a lot of opportunities for players like us, right. So we maintain very close watch on these markets, and we work very closely with our customers. to make sure that we can enter into this high-growth financial market and most importantly, at the right time. So by working in close partnership with our e-commerce platform customers, we are not only able to support the expansion, but also ensuring that our service capabilities and network, the scale, how we scale our network in tandem with their evolving needs. So essentially, you can understand it that we are growing along with our customers. So you mentioned about picking how we pick the market. So Steven's comment is that before entering the new markets that we do not have a presence, the company at the company normally conduct assessments, which cover quite a number of factors. So we give a few examples. For example, population growth over [indiscernible] Size. GDP penetration, rate of e-commerce and local business environment, we will carefully evaluate the suitable business models for each market and tailor made to make sure that we get the highest ROI as we direct the resources into these promising regions, the most promise -- and redirect our resources to the most promising regions. So as everybody know, we already established a strong foundation in Brazil and Mexico. These are the 2 largest markets in Latin America, and we have achieved very strong volume growth in both. Now we are planning to expand into additional markets in Latin America or Colombia, Peru, and our ambition is really to develop Latin America into our next Southeast Asia. We are also actively exploring potential opportunities beyond Latin America into regions such as Europe and North America. Yes, that's this response. Thanks, Charles. I'll translate for you. Yes. Thanks, [indiscernible] , for the second question. So in -- so Charles mentioned that, obviously, in our business, we need to plan ahead for capacity. And in response to the rapidly growing parcel volume. We also have commissioned quite a number of capacity expansion in Southeast Asia. Both in terms of area as well as in terms of the automated sorting equipment and line we deploy in the region. As to how we plan, so we maintain regular communication with our e-commerce and also Asian non-e-commerce customers to get more visibility about their volume forecast in the coming months, years, so that we can carry out capacity upgrade regularly and also ahead of time. So as you understand from our industry, we need some lead time to plan for capacity expansion. So we continuously talk to our customers and update our plans and also just happy to share one of the examples, like during the peak season, this [indiscernible] Season in Southeast Asia in quarter 1. Our daily pickup volume in Southeast Asia have exceeded 40 million parcels. And there were no capacity-related issues. So overall, our capacity in this region remains at a very healthy level, and we are equipped to -- and we are equipped for our growth.

We will now take the next question. from the line of Yu from GF Securities.

[Interpreted] I have 2 questions. The first question, what is the company's current approach to shareholder returns? And what is the strategy for shareholder returns going forward? The second question, how has the Southeast Asian market performed in terms of growth so far this year? Has there been any change in the competitive landscape?

[Interpreted] Just to save time, I'll answer your question in English, okay? Yes. So the first question you asked about the shareholders return. So shareholder returns, as we have communicated before, is an important component of our overall capital allocation framework. And we -- in 2025, we have completed cumulative share repurchase amounting to, I think, around HKD 300 million. On August 29, last year, our Board also approved a repurchase mandate for us to do up to HKD 1 billion. So all of this, we have only spent about [ HKD 110 million ] so far. So we still have quite a bit of capacity to use for share repurchase. So we will execute our share repurchase program where we believe that the market is undervaluing our company's intrinsic value, because we really believe that there's a long-term strong fundamentals in our business, right? And obviously, we are a long investment cycle business. So looking ahead, I think the buyback, if you do it all, it will be funded proceeds -- will be funded through proceeds that we got from the convertible bond that we issued in February as well as our sufficient internal cash generated from our operations. Yes, that's my first question on returns on shareholders. Okay. Yes. So Charles mentioned that, this question comes a little bit early, and we will be releasing our Q1 operating stats of April. We welcome [indiscernible] And all the friends on this call to stay tuned for our Q1 numbers then. But he commented that in January and February this year in Southeast Asia, we have recorded very strong growth, and this is a good start for the year. We continue to follow our neutral -- we call it 3PL strategy to be the strongest third-party logistics company in Southeast Asia. And we continue to deepen and collaborate with all the major e-commerce platform. And we want to leverage our cost advantage as well as our high-quality services. Of course, at the meantime, we want to continue to develop and diversify our customer base to include the non-platform customers. And we also observed that the e-commerce in Southeast Asia continues to grow rapidly and the platform is becoming more demanding in terms of service quality, in terms of logistic efficiency, the reliability of our network and cost, more, more and more. Some players -- obviously, some of our peers, we have seen that they may find it difficult, right, to meet all these growing demands and requirements. And it's also not surprising that they start to exit from certain markets. It is also normal for people to come in and go out depending on how the competitive moves. I guess this is just business. So but this we focus on. So we focus on really our customers and focus on how we can do our job better, how we can create more value for our customers and gain sustainable volume and leading position for -- in the long run. Yes. This is his comment yes.

We will now take the next question from the line of Steve from Goldman Sachs.

[Interpreted] I have 2 questions. My first question is under the current regulatory backdrop of anti evolution in the industry. How does the company assess the evolution of these policies and the resulting changes in the competitive landscape? My second question is, in this context, how is the company positioning its future strategy in China? Specifically, how do you think about the balance between volume growth and profitability improvement?

[Interpreted] Will translate Charles on this one. So since the areas government agencies, including the State Post Bureau, have been really at promoting -- have really actively promoted, they call the anti-evolution policy. This has received a very broad and societal level and positive response. So management believes that all this is really driving towards quality improvement, cost reduction -- sorry, operating improvement, cost reduction as well as operational efficiency as compared to just pure price competition, right. So the whole industry focus is really shifting towards service quality, network reliability, cost optimization and all this are really -- all these are really helping to build a sustainable and long-term healthy express sector in China. So the anti involution policy has really provided some kind of pricing support for our industry. As we as a company, we continuously will optimize our customer mix by developing higher-quality customers and also continue to deepen our efforts into reverse logistics and individual customers. So if one observed from our financial report, our revenue per parcel in the second half of 2025 improved modestly compared to our first half. Anti-evolution policy -- we believe that in this year will continue because it also was echoing from the -- is one of the key topics at the 2 sessions that just passed. So protecting the rights of welfare of the workers in the form of employment is also a priority. We will stick and align with the industry policies direction, and we will adjust our strategy with agility in responding to the market developments alongside with our peers. Okay. As for the second part of the question, Steve, so Charles commented that balancing volume versus margin, right? So other than when we first started out in China, we use a rather different competitive dynamics. Actually for the last few years, we have been focusing on high-quality growth. So high quality growth in few areas. One, we continue to deepen our collaboration with our e-commerce customers. all e-commerce customers actually to enhance the consumer experience. Two, we have to focus more on our capacity, building up the right network at a sorting center level, our network delivery level without [indiscernible] Will continuously refine our business operation. to make sure that we have a very good and efficient network to support our growth. Finally, I think we need -- we talk about the synergy and our customer segments. We need to also focus on the product -- the different product categories and the specific underserved markets, which we didn't cover before. So all this, it will be a balance. In short, it will be a balance between value and growth, is difficult, but it is something that we will continue to do, Steve.

We will now take the next question from the line of Brian Gong from Citi.

[Interpreted] I will transfer myself. We have noted a meaningful decline in cost per parcel in new markets in 2025. What specific cost reduction initiatives as a company implemented in those markets?

[Interpreted] Brian, I'll just answer your question in English right, just to save time. Yes, you're right. In 2025, our revenue -- sorry, our cost per parcel in new markets, it was about $1.79 compared to $1.94 in 2024. This represents about 7.7% year-on-year decrease. So to summarize, I think the improvement was driven by 2 factors. One is really the scale, the commulative scale benefit from our very fast and rapid volume growth. We continue to transfer our expertise and experience from China and Southeast Asia into these new markets. And we actually did quite a number of things, right? I mean it's a combination of all those -- all our cost reduction initiatives. Let me give you a few examples. For example, in Brazil, we drive the improvement on our labor productivity at our inbound processing stations through a combination of automated equipment upgrades, refined operation management reducing our sorting cost per parcel. In Mexico, as you know, we have moved from direct management into a franchise model. So we continue to optimize our franchise model policies to reduce or to actually have a scale rate for our pickup and delivery -- the delivery activities, reducing our pickup and delivery cost per parcel in Mexico. So in Middle East, obviously, this is before the recent complex. This was last year. In last year, we expanded our scale and improved the operational efficiency of our self-operated line haul fleet. We continue to optimize our transportation capacity to lower transportation cost -- to lower our transportation cost per parcel. Yes. So these are some examples, right? It's obviously -- there's a lot of things that we do in total that we bring down the cost. But overall, we remain very highly optimistic that our new -- our long-term growth in our new markets will be very strong. And we'll continue to invest in our infrastructure, therein to improve our local efficiency. And as mentioned earlier by Steven, that new markets, we believe that we will build on, if not more Southeast Asia from our new markets.

I would now like to turn the conference back to Haibin Chen for closing remarks.

[Foreign Language]

[indiscernible] Conference call. Thank you for participating. You may now disconnect.