BingEx Limited Price & Performance (FLX)

Hong Janyu, Co Founder, Director and Executive President and Mr. Luq Tan, Chief Financial Officer. Will now turn the call over to Mr. Adam Xue. Thank you.

Hello, everyone, and welcome to Flash. EX fourth quarter and full year 2024 earnings call. In the fourth quarter, FLYEX recorded total revenue of RMB1 billion. The Gross margin rose to 10% representing a 1.4 percentage point year on year increase. Non GAAP net profit for the quarter was RMB20 million. For the full year, total revenue remained steady at 4,500,000,000.0, fueled by ongoing improvements in operational efficiency, the company achieved 2.3 percentage point increase in gross margin for the year. While non GAAP net profit surged by an impressive 82% compared to the previous year. Moreover, the average gross profit per order rose by 21% year on year. Underscoring the solid resilience and competitive strength derived from Flash EX differentiated market positioning, amid an intensely competitive industry landscape. Twenty twenty four stands as a milestone year in Flash EX journey. Highlighted by sustaining sustained growth and broad industry recognition. FLUSH EX also become China's number one on demand dedicated career service brand for ten consecutive years. A prestigious title that not only validates our decade of exceptional service but also pays tribute to each of our committed employees [indiscernible] and diligent [indiscernible] who [indiscernible] conditions to ensure excellence in every delivery Since our inception, we have remained focused on on demand dedicated courier model and understanding every order bears our users' trust and expectations.

From order placement to final delivery, we prioritize precession ensuring a seamless point to point experience that meets real time needs. [indiscernible] unwavering attention [indiscernible] to detail and pursuit of excellence have metEax a household name and the byword of the Intricity on demand dedicated career industry. By the end of twenty twenty four, Flash EX service expanded two ninety five cities across China, supported by network of 2,800,000 registered riders and 100,000,000 users, The total number of orders fulfilled in full year 2024 reached $277,000,000 making an increase from 2023. [indiscernible] debut on NASDAQ this year taking a crucial step forward with its capital market entry. Our successful IPO underscores the market's confidence [indiscernible] positioning and industry leadership while also is developing a strong foundation for the company's sustained development and growing brand influence. 2024 was also a year of both accomplishment and challenges. The on demand delivery market grew increasingly competitive with numerous industry players expanding into this sector. However, we firmly believe that the true service excellence lies in unwavering attention to detail and efficiency. That's why Flash EX remains committed to the on demand dedicated grid model dedicating every flash rider to a single order from pickup to drop off.

Free from distractions. This approach guarantees fast, seamless and personalized point to point deliveries. Ensuring that every order is not just a swift but also handled with utmost care. To further elevate service quality, [indiscernible] analysis of the [indiscernible] details distinct characteristics and specific logistical requirements of various product categories. [indiscernible] we developed tailored solutions that address the unique challenges of each delivery scenario. For delicate and perishable items such as birthday cakes, we have implemented advanced protective measures to ensure they're flawless arrival even in the peak heart of summer. For high value electronics, we have enhanced our insurance framework providing comprehensive coverage to mitigate risks at every stage of delivery from merchant to customer. [indiscernible] Simultaneously, we have strengthened protections for riders ensuring their rights and well-being are safeguarded throughout the delivery process. Furthermore, we provide tailored services for discerning customers and those with specialized needs. Including personalized transportation options, customized rider attire and exclusive protect specific packaging solutions. [indiscernible] With our professionalism, and precision reflected in every detail Flash EX strives to deliver an exceptional and elevated value experience for our users In 2024, we launched the customer delivery boxes [indiscernible] Designed with adjustable compartments to meet specific requirements of different product categories.

We intend to expand this initiative to additional cities further elevating both delivery security and service excellence. It is the same link subtle yet profound impactful details that create Flash EX unparalleled competitive edge in on demand delivery market. Securing our unique position in intensely competitive environment. Flash EX is also accelerating its digital management transformation, leveraging cutting edge digital systems and processes to elevate operational efficiency. This ensures the seamless alignment of premium delivery resources with high value users Even during peak period, such as holidays or challenging weather conditions. By delivering constantly, punctual and secure services They cultivate strong word-of-mouth [indiscernible] Further, solidifying our brand reputation while our superior user experience continues to drive sustained order volume growth. To further elevate our scheduling systems, intelligence and efficiency, we have progressively integrated DeepSeq into our service infrastructure and developed a unique algorithm tailored to our on demand dedicated career model. This algorithm optimize order allocation, substantially enhancing delivery efficiency accordingly We reduced average delivery time for full year 2024 to twenty six point eight minutes We On the company's operation level, we have completed the privatized deployment of DeepSig and developed operational assistant that serves multiple departments including product and operations.

This assistant has significantly streamlined daily workflows boosting over efficiency Looking ahead, Flash EX will continue exploring the application of big data models and cutting edge technologies across diverse verticals and throughout the entire value chain to drive the intelligent advancement of our organizational operations data analysis, and decision making capabilities. Meanwhile, we have enhanced and de rated our customer service system nationwide upgraded system features automated capabilities to efficiently handle customer complaints related to delivery delays, This advancement has not only reduced operational costs, [indiscernible] but also ensures that user inquiries and requests are addressed properly and accurately, significantly elevating overall customer satisfaction. On a related note, we conducted a comprehensive organization [indiscernible] And optimization in the fourth quarter aimed at driving ongoing cost efficiency improvements through a more strategic organizational structure and a clear duty allocation. These efforts not only enhanced Flash EX internal operational effect effectiveness but also provided us with a significant competitive advantage further cementing our leadership in on demand dedicated careers industry. While continuously enhancing the user experience, Flash EX has always viewed a rider's welfare and care career development essential to the company's overall growth. Through a comprehensive approach that spans well thought benefits professional development, operational support and cultural initiatives.

We carefully protect our riders' rights and interests cultivating a strong sense of belonging and professional pride. By the end of twenty twenty four, Flash EX has successfully established 11 riders home across 10 cities nationwide. These facilities not only provide riders with one stop services such as rest, recharging and the vehicle maintenance, but also serve as welcoming gathering places. For them to share, experiences and stories. In addition, we have partnered with dedicated merchants to jointly create over 3,600 rider energy stations in more than 100 cities across the country. Offering riders more convenient energy, replenishment, and restor areas. As part of our commitment to prioritizing our riders' health and well-being, we have implemented a vehicle rescue service to ensure riders receive prompt and effective assistance in the event of an emergency. Furthermore, we conduct regular safety training programs combining theoretical instruction with hands on practice to continually strengthen rider safety, awareness and emergency response capabilities. Moreover, we continually refine various systems to foster more efficient and supportive work environment for renters. By leveraging cutting edge order matching algorithms dynamic intelligent dispatch systems and robust safety protocols. To ensure precise order allocation and seamless scheduling, effectively reducing riders' wait times.

This not only enhances their delivery efficiency, but also ensures the stability and sustainability of their income. Since 2022, the Ministry of Human Resources and Social Security in collaboration with other relevant departments has initiated a trial of occupational injury insurance for people in new forms of employment across seven provinces. And [indiscernible] including Beijing, Jiangsu, etcetera. Over the past two years, the trial has expanded its coverage to four key industries, ride hailing, food delivery, on demand delivery and intracity logistics. [indiscernible] As an active participant, Flash EX has adopted a per order payment model to provide riders with enhanced protection, ensuring comprehensive coverage for every delivery. At FLUSH EX, we firmly believe that the only biannually supporting and nurturing each rider can be truly enhanced service quality. As the other cornerstone of our exceptional, efficient and differentiated delivery experience. Moving forward, we will remain committed to our funding principles and on demand dedicated career model They will continue to prioritize our core users and core values. Gain a deeper understanding of users' diverse needs and constantly striving to deliver a more personalized and differentiated service experience. We will also continue to expand our category coverage offering users an even broader range of convenient options Meanwhile, will leverage big data analytic and user research to accurately capture evolving market trends.

As we constantly amplify our presides in the individual industry market we will also strengthen our collaborations with business customers and enhance service scenarios to deliver premium efficient and tailored delivery services to a growing user base. Finally, [indiscernible] embrace a more open and innovative approach in 2025 elevating the service experience while operating with industry partners. To propel the sustainable and healthy growth of the on demand dedicated career sector. And then I will hand over to CFO, Luke, to introduce more financial details. Thank you, Adam. Hello, everyone. This is Luke. In 2024, our unique on demand dedicated courier model remains strong and resilient Demonstrated by sustained growth, in the total number of orders fulfilled throughout the year We are also delighted to see that our efforts to improve operational efficiency have delivered positive outcomes. With gross profit margins exhibiting healthy growth [indiscernible] in both the fourth quarter and full year 2024. Meanwhile, non GAAP net income for the full year 2024 saw a strong upswing of 82% compared to 2023, with non GAAP net margin rising by 2.1 percentage points to 4.5%. Now let me walk you through the key highlights of our fourth quarter and the full year 2024 financial results.

For the fourth quarter, we recorded total revenues of RMB1 billion, total revenues for the full year 2024 reached RMB 4,500,000,000.0 remaining a largely stable compared to 2023 despite intensified market competition. [indiscernible] Our cost of revenues decreased by 60.5% year over year to RMB 926,000,000 for the fourth quarter primarily due to the improved operating efficiency on rider force. And decreased [indiscernible] remuneration and incentives to fulfill orders. Our gross profit was RMB 100 an increase of RMB102.9 million for the fourth quarter mostly flat with the same period of 2023. Gross profit for the full year 2024 grew significantly to RMB 490,600,000.0 representing a year over year increase of 24.3%. Gross profit margin grew by 1.4 percentage points and 2.3 percentage points for the fourth quarter and full year 2024 respectively. Turning to operating expenses. Our total operating expenses were on the 255,600,000.0 for the fourth quarter consisting of selling and marketing expenses, of R and D 90,300,000.0 general and administrative expenses of RMB 85,000,000 and research and development expenses of RMB 80,400,000.0 The increase in operating expenses was primarily attributed to the [indiscernible] recognition of accumulated share based compensation expenses. Subject to IPO conditions under U. S. GAAP.

Excluding share based compensation expenses, our non GAAP income from operations was RMB 7,300,000.0 for the fourth quarter Non GAAP income for operations for the full year 2024 sold to RMB 134,300,000.0 from RMB 10,000,000 in 2023. Other income was RMB 7,300,000.0 for the fourth quarter and RMB 40 RMB41.7 million for the fourth quarter and RMB41.7 million for the fourth quarter, RMB41.6 million for the fourth quarter, RMB41.6 million for the fourth quarter, RMB41.6 million for the fourth quarter, RMB41.6 million for the fourth quarter, RMB41.6 million for the fourth quarter of 20,000,000 for the full year 2024. Compared with RMB 40,200,000.0 and RMB 74,300,000.0 for the fourth quarter and full year 2023, respectively. The decreases was primarily due to a lower amount of government grants.

Let's move to our non GAAP net income which stood at RMB 20,100,000.0 for the fourth quarter Non GAAP net income for full year 2024 non GAAP net income for full year 2024, surged 82% year over year to RMB $2,000,000 Our cash position remained healthy with cash and cash equivalents restricted cash and short term investments, totaling RMB $793,000,000 as of 12/31/2024. As we moved into 2025, we remained committed to our on demand dedicated courier model reinforcing Flash X unique market position we will also deepen our efforts to optimize corporate structure and enhance operational efficiency, supported by our differentiated service model and the solid financial foundation. We are confident in our ability to drive sustainable growth. That concludes our prepared remarks. We would like now to open the floor to your questions. Operator, please go ahead.

Thank you. We will now begin the question and answer session. For the benefit of all participants on today's call, We will now take our first question from the line of Jesse Hsu from Deutsche Bank. Please ask your question, Jesse. Hi. Good evening, management. This is Jess Yixu from Deutsche Bank. Congratulations on very resilient results and a tough environment last year. Thanks for taking my questions. I have two questions. The first one is on macro. Understood that in the past few months, we have seen some policy stimulus. And overall consumption sentiment seems out. So I want to to check-in whether we see any changes in our operating environment year to date? And my second question is about our outlook for 2025. Can management elaborate on your outlook in terms of other volume or revenue or margins? For the New Year? And what would be the key growth drivers?

Thank you. Thank you, Jessie. This is Adam speaking. Recently, a series of government initiatives including trading programs have significantly strengthened consumer confidence. As overall sentiment improves. Growing consumer demand has directly driven the expansion of on demand delivery volumes. Notably, the rapid rise of emerging e commerce format such as live streaming and social commerce, has injected friction momentum into the market fueling additional growth in the on demand delivery sector. In response to this evolving market dynamics, and the growing demand for hair service quality, Flash EX will enhance and upgrade its business operations in the following key areas. The first one is optimizing operational process. Leveraging big data analytics to enhance order matching efficiency and optimize delivery routes enabling faster response times and improved overall operational performance. Additionally, integrating DeepSeq into the customer service system slash e x proactively enhance service quality. Uphold its strong reputation and further strengthen user engagement on the platform. But the second is category driven strategy. Flash EX will conduct in-depth and analysis of storage and transportation challenges associated with core product categories. Developing targeted solutions, to address this pain points Moving forward, we aim to create a distinct distinct play differentiated experience by adopting a vertical approach to key product categories aligning them with Slicex specialized fulfillment capabilities.

By addressing the unique needs of users, across various categories, we will further strengthen our differentiated fulfillment expertise. In summary, we will enhance our business operations by optimizing our operational processes, strengthening user experience and differentiation and implementing a category and customer experience driven strategy all designed to improve our operational capabilities and better adapt to market change. While meeting the evolving needs of our customers. Thank you.

Thank you.

Our next question comes from the line of Susan Zhang from CICC. Please ask your question, Susan.

Thank you, the management team for taking my question. I'm Sifan from CICC. I've got three questions here today. The first question is, what will be your outlook in the demand for 2025? The second question is, may I ask how assessment of the competitive landscape of the industry this year? The third question is, recently there has been discussion about providing social insurance for riders the on demand delivery industry OBR stands on assisting riders this year's social insurance. Thank you.

Thank you for your question. Firstly, demand growth remains resilient. Recent policy signals indicate that the support for customer sectors will further strengthen in 2025. With a gradual recovery of the macroeconomic environment and the continued deepening of e commerce penetration delivery volumes are poised for sustained robust expansion. At the same time, the emergency emergence of new e commerce formats such as live streaming and social commerce. [indiscernible] has drawn more players into the logistics sectors. These innovations not only enhance efficiency, but also elevate the shopping experience promoting more local merchants to engage directly from customers and deliver fast high quality logistic services to meet the rising market demand. Second, consumers are placing increasingly emphasis on delivery timeliness personalization and customer experience. As e commerce offering diversified and customer preference become more discerning customers not only seek premium products, but also expect an elevated customer experience characterized by greater efficiency and reliability This includes increasing demand, for securities speed, and meticulous attention to detail especially during special occasions and festive events. On the policy front, the continued expansion of the trade in program is set to drive hair purchase frequency of premium consumer. From the merchant's perspective, fast and secure delivery services are instrumental in enhancing our customer experience and satisfaction.

Ultimately strengthening brand reputation and fostering long term growth. For business in specialized sectors such as [indiscernible] bakery, and high end restaurants the need for personalized high quality delivery experience is even more pronounced. Flash EX has conducted in-depth analysis of the logistic pain points associated with various product categories and develop tailored solutions accordingly by implementing enhanced protective measures ranging from optimized packaging to specialized transportation vehicles and refining its insurance mechanism to better mitigate risks Flash EX ensured that its delivery service for merchant are both highly reliable and customized to their unique requirements. Finally, digital transformation is accelerating the logistic industry's development with a widespread adoption and continues evolution of big data models. Technologies such as intelligent order matching, route optimization and AI driven customer service are becoming deeply integrated into operations. Driving significant improvement in efficiency, and service quality. [indiscernible] embraces technological advancements We have fully deployed the deep sea system developed a pre oratory algorithm tailored especially to our on demand dedicated career model. This advancement have markedly enhanced order matching procession and fulfillment efficiency. Meanwhile, we have comprehensively upgraded our niche nationwide customer system infrastructure, significantly reducing response times for users' inquiries and feedback while streaming operational costs.

We also continue to optimize internal processes by harnessing the power of big data analytics fortifying our market position and reinforcing our long term competitive edge. To the second question, first, we foresee that the competitive dynamic within the intracity delivery industry will persist in 2025. However, leading companies will maintain a distinct competitive advantage as consumers demand for quality continue to rise and business client increasingly prioritize customer experience top tier companies that focus on detail and consistency will gain greater favor with users. Fulfilling powerful word-of-mouth and establishing a dominant market position. As these leading brands expand their SKU enhance their market recognition, their user loyalty will also grow. Thereby strengthening their market competitiveness and lying a solid foundation for sustainable long term growth. Secondly, digital operations have emerged as a core competitive advantage for intercity delivery companies through digitalization, companies cannot only achieve effective cost control and sustained revenue growth, but also significantly bolster customer loyalty, and optimize network efficiency. Take Flash UX as an example. We have proactively integrated big data driven technologies enabling us to reduce average delivery time in 2024 to just twenty six point eight minutes Furthermore, our operational efficiency enhancements have not only elevated our user experiences but also significantly improved our profitability.

Simultaneously, the mid to end mid to high end market [indiscernible] vast growth potential. As both consumers and business clients place every greater emphasis on quality and personalized services. The mid- to high end delivery market is poised for continued expansion. This segment will become a primary focus for intracity delivery companies Flash EX will remain committed to the on demand dedicated courier model, reinforcing and broadening our leadership in this area by providing fifth high quality and tailored customer experiences. And for the third question, Flash EX has always viewed riders' welfare and career development as crucial to its business growth. The company is committed to safeguarding [indiscernible] riders rights across various aspects while actively fostering a strong sense of professional pride and belonging among this workforce. By the end of twenty twenty four, FLUSH EX has successfully established [indiscernible] In 10 cities nationwide. This hub offers riders a comprehensive range of services, including rest, recharging and the vehicle maintenance while also providing a welcome welcoming space for interaction and experience sharing. Furthermore, in close partnership with partners merchant we have set up over 3,600 rider energy stations. Across 100 cities, These stations offers riders timely energy, replenishment and comfortable rest areas ensuring that you supported and valued during their busy hours.

To enhance rider safety, they regularly hold safety training sessions that blend theoretical instructions with hands on exercises. [indiscernible] continuously strengthening Ruger's awareness and improving their ability to respond to emergencies Additionally, as the company expands our system evolve, we have dedicated to create more efficient and convenient work environment for riders. Helping them complete orders more swiftly and ensuring the sustainability of their income. Thank you.

Thank you. And that concludes the question and answer session. I will now turn the call to Helen Wu for closing remarks. Thank you once again for joining us twenty twenty four fourth quarter and full year financial results. And the business update conference call today. If you have any further questions, please contact the IR team and the BEX or PS and T Financial Communications Thank you and have a great day. Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.