Q3 2020 BEST Inc Earnings Call
Good morning, and good evening, ladies and gentlemen, thank.
Thank you a standing by welcome to Best Inc. Third quarter, 20, Twond and earnings conference.
At this time, all participants on a listen only mode.
Following management's prepared remarks, there will be a cure and access.
Well those today and Mr., John and show Best Chairman and CEO and Gloria from Ses.
Chief Financial Officer.
Well today's agenda, Johnny will give a brief overview a business and operational highlights and.
And I will explain the details on financial results.
Following the prepared remarks, you may ask your questions.
Please note. This call is also being webcast a on best Inc.'s IR website.
I on Dot best.
Hi, <unk>, Inc. Dot com.
A replay of this call will be available after the call.
And Investor presentation is also available on the on our web site.
Before it begins I will read the safe Harbor statement on behalf of Best Inc.
Today's discussion will contain forward looking statements. Thanks.
These forward looking statements are based on managements current expectations.
Involve risks uncertainties and other factors all of which are difficult to predict and many of which are beyond the managements control.
Company does not undertake any obligation to update any forward looking statements as a result of new information.
And your events for others, except as required under applicable law.
Please note also note that certain financial measures. That's a company uses on this call a expressed on a non-GAAP basis, such as EBITDA.
Adjusted EBITDA.
Non-GAAP net loss.
The GAAP results and a reconciliation of GAAP to non-GAAP net.
Sure a can be found and best Inc.'s earnings press release.
Finally.
Please note that unless otherwise stated.
Oh figures mentioned during this conference call on in RMB.
Now I'd like to turn the call a word to Mr., John and child, Chairman and CEO Best Inc. Johnny the floors or a service.
Good morning, and evening everyone.
Welcome and thank you for joining our earnings call.
On today's call in line.
Moving to the full quarter results.
We will also discuss our major strategic adjustments to refocus on our core businesses.
In order to a cheap long term and kept competitiveness and profitability.
But before that let me first go over I'll walk quoting a results.
We had a challenging and so quarter.
A meeting passed by the industry a competition.
Well expressed.
It's execution getting on me.
A fast changing market dynamics, and most operation and a pricing strategy.
Which led to a lower volume growth and a margin.
Positive volume increased by 24.8, saying yield per year.
Representing a lock Michelle can only 6% during the quarter.
Which is a bomb 0.1 percentage point a lower.
Okay, there was a second quarter.
Well its gross margin contract and a bike 7.2 percentage points.
And the average cost a possible decreased a.
15.9% year over year.
And not completely offset a S.P. decline of 21.9 year over year.
We have seen is conducted a thorough review of the express operations and strategy.
And we are going to Miss a a impairment in class and change a steady we believe will make us a competitive.
And and maintain our position as a one of the leaders in that and you see going forward.
Oh, a free business.
Continued its a strong growth and achieved a growth rate higher debt and the industry average.
Free volume increased by 30.7% yield a year in the third quarter of 2020.
It's gross margin declined 5.3 percentage points year over year price.
Primary as a result, our pricing.
That its a.
After the problem and leading stayed at a highway tolls you had a second quarter.
ASP declined by 17.3% year over year as well.
While average a cost per ton decreased by 12.6% yield a yet.
Looking ahead, we are optimistic that fray and we'll continue to grow in a Saudi percentage range.
And if you continue to improve and we expect to return to profitability in a fourth quarter.
Moving to a best supply chain Management, Inc.
And just a quarter.
Well continue to execute on our strategy of a growing our franchise called web seed business and.
And focus on projects with a high margins and clients with strong credit profiles.
It's gross margin decreased by four percentage points year over year 2.4, 0.4% price.
Primary due to a higher cost structure, a social was a legacy key account customers.
What's driving the process a being terminated.
The total number of orders for feel would have a called a web sees.
The increase a by 18.3% year over year.
Two 102 punch remitting, even thought a quarter of 2020.
Oh from wage a total number of orders fulfilled by franchise a cloud web Ses.
Increased by 32% year over year to 53.5, moving the number of franchise and we have seen increased by 23.2% year over year to 345.
[noise] Best you Cogdell brought more diverse and asking me on put a platforms a number would be I guess the drivers on the you a couple of mobile apps, Inc.
Chris just by 84.5% year over year.
To a 288000.
Total number of transactions on the trucking brokerage a platform increased by 37.2% year over year to.
For 233000.
That's a good overall.
And to you as a strong growth momentum Inc.
And he say you're.
In a door a quarter.
Possible volume and tight and increased by 513.5% year over year total.
On the approximate 10 milling.
While a possible boring and Vietnam.
Increased by 932% year over year to 10.3, moving the company also made a progress in expanding its expressed everybody services in Malaysia.
Cambodia and Singapore.
Best of class execute on a strategy a partnership model.
And enhancing order quantity.
The improved gross margin and reduce losses.
As a result, it's gross margin increased by 2.9 percentage points year over year to switching pulling a 4% while adjusted EBITDA margin improved by 1.8 percentage points year over year.
Despite these encouraging results.
We recently announced.
The winding down of store class business, except well a self operate woolworths stores, which is still on the strategic review.
I believe that by facing all store class.
Company can't eliminate a significant cash for a total clemens a so.
Socially weighted just go to a stage a business.
And a company into a photo prioritize kept a lot of patience pull what's a school business.
Let me discuss its core business.
The call a bit pandemic had a profile on the impact on our business.
The high recovery costs, and a subsequent and per season that pricing competition is.
It's a presque Isle and margins and costs on expected losses.
Based on strong industry and have wins, we are taking steps to make a major strategic adjustments and.
And the organizational changes to our business.
Moving on our core logistics and supply chain management business.
Emphasizing service quality and.
Enhancing operating efficiency.
As a goal of putting us back from a past and profitability.
Well, Chris Express business.
We are focused on a sustainable long term growth and the profitability by continued to optimize its product structure.
Improving its operating efficiency, particularly in transportation funding.
Seems service quality and a customer experience.
And gaining market share.
Were putting in place new leadership to lead express business.
As previously announced a.
Effective asked on November 15, 2020.
Mr. A washout chain form a general manager of best jumped from problems branch.
Assumed a position of Vice President General manager, a best Express service line, but.
From a pacing Miss a dose I'll walk what took up a new role as a company.
Well a freight we continue to what kinds of continuing to invest into his infrastructure and that one.
So they defy our industry leadership position by expanding our market shares stressing that E commerce aspect of a phrase services.
Improving operating efficiency and increasing profitability.
Well I'll a supply chain management.
We will focus on a quality growth and profitability.
And we target projects.
With a high margins and customers with a strong credit profiles, well continue to implement and asset light model and a growth of franchise Cobwebs E business.
Well, a non core business.
We announced a wanting to have a best of class on November 15, well.
On the other cool non core business, including a cobble capital and global we're considering all options available with a goal of reducing operating loss and the capital crime and from the company [noise].
[noise]. Additionally.
We are implementing company wide a cost cutting measures that a war generated a significant savings going forward.
It's a measure will also help us create a leaner and more focused organization to realign a management team and employees, who execute a four.
Book W. focusing plant.
And we look forward.
We remain confident in a stress on the economy.
Driven demand for our income voice lot supply chain solutions and a logistics services.
Well this is a strategic adjustments in place.
We are committed and more than ever to investing our core business is a strength strength.
The strength and our market position.
We are targeting strong growth, while a business while focusing on from the integration of our business units in.
Enhancing our product structure.
That's a good I'd and the flexibility of our networks.
The quality of services and the overall operating efficiencies.
Which taken as a whole will enable back to deliver long term value for our shareholders.
I would like to turn the call over a 12, a CFO Gloria too.
To walk you through a what they'll put up and shows.
I had a Cory takes a johnny and Hello, everyone and amid a intensified competitive market on third quarter performance reflect both the challenges and an easy length of haul business.
Revenue was 8.7 billion RMB relatively flat to a same period on last year why our gross margin contracted 5.4 percentage points year over year due to a challenging pricing environment that offset a volume growth across multiple business units.
Adding a net loss of 640 million RMB.
Despite a net loss we generated operating cash flow of a 115 million RMB during the third quarter and to maintain a healthy balance of cash and cash equivalents restricted cash and short on in Bakken and a 4.8 billion RMB.
I will now provide a brief review about a third quarter 2020 financial result, given a limited time on today's call I will be presenting a thought abbreviated financial highlights I.
I encourage you to read our press release issued earlier today for further details.
Our gross profit was 38 million RMB compared to 500, and a 7 million RMB in a same quarter of 2019.
Gross margin was zero, a 0.4 per cent compared to 5.8% and the same quarter on 2019.
Adjusted EBITDA for Q3, and negative 430, a new that RMB compared to 114 million RMB over the same period of last year.
Q3, adjusted EPS, EBITDA, <unk> coal logistics and supply chain management business was negative 278 million RMB compared to 267 million RMB from the same period of 2019.
Next moving onto a key financial highlights for all business units.
Year over year basis, best that express revenue decreased by 2.6% year over year to 5.1 billion RMB in the third quarter of 2000 and time.
Primarily due to a 21.9% year over year decrease in ASP per possible, partially offset by a 24.8% year over year, increasing profit volume the.
A decreasing SP is primarily attributable to a competitive market dominant dynamics.
Adjusted EBITDA, what best expressed was negative a 211 and the RMB compared to 192 million RMB from the same period of last year.
That's great to see revenue increased by 8.2% year over year to 1.5 billion RMB.
Primarily due to a 30.7% year over year increase in free volume, partially offset by a 17.3 per se you.
Over a year decreasing S.P. per <unk>.
Which was primarily due to a pricing lag after the government that reinstated is a highly tolls in a second quarter adjusted EBITDA for a best freight was negative 45, and the RMB compared to 42 million RMB for the same period of last year.
Q3 revenue for best supply chain management grew 5.1% year over year to 453 million RMB adjusted EBITDA, what best supply chain management. It was negative 27, and the RMB compared to a 6 million RMB from the same period of last year.
And you Cosmos Chiu fee revenue decreased by 1.9% year over year to 689 million RMB, primarily due to a discontinuation of several key account customers to minimize credit exposure.
Adjusted EBITDA for a best you called out was negative 30 me on the RMB compared to negative six net on beat for the simple here the last year.
Store class is revenue decreased by 16.8% year over year to a 717 million RMB, primarily due to efforts sling has ordered a quality to improve margins.
Adjusted EBITDA loss for a store class lets 68 million RMB compared to a loss of 98 and the RMB for the same period, a last year Q.
Q3 revenue for a best global increased by 125.9% year over year to 216 million RMB, primarily due to strong growth impossible volume was in South East Asia.
Adjusted EBITDA flow back a little bit negative 61 million, a RMB compared to negative 31 million RMB for its impute a last year.
Next lets look at a major operating expense items. Please note all this expenses excluded share based compensation.
Selling general and administrative expenses were five.
181 million RMB or 6.7% on the revenue in the third quarter compared to 470 million RMB or 5.4% on and revenue in the same period of a 2018.
The increasing F G and H expenses, what was primarily attributable to a crew provision for a certain trade receivables and a law losses on disposal fix assets due to upgrade and expresses equipment.
R&D expenses decreased by 11 million RMB or a <unk> to 51 million RMB, which was primarily attributable to a capitalization of certain R&D expenditure to intangible assets as well as a reduction in travel expenses.
As a part of the company wide strategic and refocusing plan, we are optimizing our SDMA and R&D expenses to focus our resources on our core business.
We anticipate and estimate cost savings of approximately 200 million RMB by the end of 2021 day.
Savings will not create a linear and a more focus on examination by prioritizing spending and optimizing operating efficiencies across the company.
Capex in the third quarter was 487 million RMB or a 5.6% on total revenue.
Compared to 500 tons being the RMB, what's expected total total revenue for the same to you at a black [noise].
That concludes the third quarter financial overview.
Before we open the call to questions I'd like to provide a summary after conducting a thorough analysis of our business.
We we are already underway in the process and we're creating a more streamlined organization that can simultaneously trigger a further growth and the improved profitability.
The market headwinds we were facing a.
Along with a recognition of on need to a more favorable the a line <unk> operations as a company has led to this decision.
We believe who's a strategic a re evaluation of our non core businesses meaningful cost reductions and allocation of resources.
Best can better a defense is core portfolio in order to deliver a consistent and long term value to our shareholders.
With that we will now open the call to Q and a thank you.
Thank you Madame.
We will now be getting a question answer session.
Ask a question you May proceed star then one on the touched on from it.
For years and years Speakerphone, please pick up a absolute before a pressing the keys.
And then from a question has been adjusted to like your doors. A question. Please press Star then too I get a little stalled a little one to ask a question I.
I just have a will just pause momentarily to a somar roster.
And the first question, we have will come from valuing inside of Citi. Please go ahead.
Oh, hi, and buying Johnny and on where I. So thanks for taking a question yeah. So my first question regarding that.
Okay and then.
It's not a text has.
Action a whole group.
Oh strategy change a window refocus on net price and a great just want to know what would be the key change at all.
A development and can you kind of occasion stretching a after.
And that she just a person now a especially on the expressed a little bit.
And then my second question. It's also a regarding a and restructuring so once a week its production cash cost I see a I'm going to close a stop has taken a cost a country. So I believe we need to come to send to the Dol. So once we have achieved a restructuring costs and Oh wait a from a BLA we are a.
Previously she mentioned about 200, a male and female and the 200 and then see those duties.
And so we as a signals from thank you.
Yeah, Hi, Bonnie Thank you put a questions yeah, everybody regarding to a first a question on by express strategy moving forward.
And we reevaluate your order book, a express a operation and certainly a lot of area, we need to go to improve on a.
A number one is that Uh huh.
How do we rebalancing and all and network development.
In the past a we are a very much focused on now but you know we are doing well and suddenly a year like you know you and some O. A some a major these markets, but actually we could have done a lot better a balancing on some of the some of the area that we actually have a stronger a market, but we can do.
A better so that means we will increase our.
A ASP a possible revenue because a you know D. On on this compact vary from better market like informed on a certain area or he will be a the that ASP is a very low but actually in a a sum of sort of a of the other provinces actually.
So that less of a pricing pressure a income up the a the a and so we should probably will get better better.
ASP as well as the on a better cost structure, because a now what's a more balanced. So that's that's a number when things were taking a look at it and we'll see how the net will can be more balanced a base on the current structure rather than a a primary focus on several key key markets and that will improve our on.
On network efficiency on as well as the ASP improvement.
On a number two side is that we continue to look at our transportation humans on transportation costs.
Oddly felt a well if you look at a whole cost structure, we actually went down about 12 cents, a 15% up a total a on a reduction in cost a year over year on.
And of course, a war or however, you know does a pricing comes on more on the solar. So so so what we want to see is that if on a transportation side and we can't have you been.
More off a reduction by walking ways, a a phrase side and more combined a raw.
Moving up the line, so a long line hole and et cetera, and that will help us to more reduce the.
The on the audio line and then another one and can help take a look at our leasing cost on a leasing costs and there's still quite a high said about 10 cents for a possible a compare was our our other competitors are probably will be much less a this primary because we had a build up a a capacity.
Capacity and that you know in the past a couple of years you anticipating a was continued growth of a high growth a in our Oh, So express business.
And just just growth this looks lower agenda, we on a plan. So so actually we have a more capacity and exciting.
So that's another area that we're looking at it. So that's a first question on them and key exchange, Indeed express side, a basic and balance sheet and now with a better than just focusing on a few key market.
And the second is a continued to improve the cost structure, especially on transfers from site a.
We actually had a some you. We also started with some of the a self operated a fleet rod and compete or outsourced. So starting on the set a first quarter I think this year or we have some you know several briefly in value on the growth.
Share.
Certainly talking about restructuring cost I'm, sorry, second cost on a store plus from we probably will have additional on by shutting down the a deal or the a branch offices and also a deal with the inventories and all the issues that we need to deal with probably a little who live in a little bit over 100.
Moving on and be additional cost a social was that a.
A that's one time a charge into a disposing of a business. However, a debt that will give us a a couple of hundred million dollars a saving every year on moving forward on.
Because a business essentially still still use a money, losing a sole onetime a additional costs such and close on that or the other business like the a we still on looking on the order or the or the other as a any other I'm sorry options and to look at it. So I don't have the exact number right now a which is a smoker.
And about the 200, meaning a off the a saving and you just.
Total Gloria Oh, Okay, Hi.
Are you so basically the two on the million dollar savings on you know on appeal on 2021, I'm a majority of a saving on came from a the winding down of outdoor class a danyal Hussain, we're able to say about 170 million RMB a associated with store class winding down and a also.
We are continuing to optimize a SDMA on expenses. So we anticipate a ER and now the additional $30 million to $40 million a cost reduction as channel.
Okay. Thanks, John you think Gloria young and he may have a follow up question on that.
Express and ever a bit management structure, and it's not always true for cash.
And change of the personnel Casino day Temptation all day, it's still quite expensive and a we can feel bad and either.
It's not a waiting to I'd have to go through and hopefully, yes, they want and a more polarization of disappeared [noise].
Well at this point of time, a week you begin to follow their price in scratchy called it will flow that dragged down our profitability and a.
Yes I was.
Cash flow boy, if we change our personnel and we are more focus on a day.
On a long production region, we have a lot more balance and to work and then they will be more differentiated where.
What do you think about day contagion strategy.
Oh I'm a deal.
DRG a as I just mentioned a right. We we were looking out a whole network based on the current on.
The S.P. on and the cost structure and everything so suddenly we will you know in a mark you had to compete so so we certainly will have a written response to whatever that might be a competition. He is a same time I I mean, I think the motion on things that we need to really optimize all net worth to see whats the a.
We can't get out of it a best of the on the on the results.
So yeah, so so's price a competition still can be there.
Meanwhile, I think a we should do better job of we can do a better job.
In optimized on network, a by providing a better service quality services on high ASP to southern region, So, but we optimization and also due to a lower cost of course and more.
Okay. Thank you again and thank you bye thank you.
And next question, we have a will come from on site of Keybanc.
Hi, Thank you for taking my question No warning zone I, just want to follow up all right.
From.
Uh huh.
And I, just get a growth attention in terms on.
The pricing strategy, let's say.
Come to a.
From price.
And volume.
Right and then on and that as a peak.
The decline or volume grew up.
On the margin so what's all on strategy on.
Do we have that.
Capex for.
Profitability and beyond that we won't do and well there a double.
On the pricing change on because we don't Oh insulin pump sales or.
Still we still have a second type on the par before a bond and <unk> and it's a because we want to some market share and warm it's such a scale right and then so that's first and then.
Second question would be.
Because we have a long haul research.
And restructuring and our leadership, we express a small and then and just wonder AUO is there a risk and like all there could be.
And create some instead will be on T. O our franchise and nickel and.
Thank you.
Okay. A highest thank you have a question with regard to first question on D. A up a balancing of course, we need to do or actually not really just a for a low at a price and getting the volume, but was a lot to look into profitability and as such a so so inc.
Our goal is of course with a a I think that the goal is a reasonably good a gross but of course, a profitable growth that that has a goal I'm. So how to achieve that I had a measure and some of that if you look at through our.
On a cost structure that we putting on that a yard so basically a right now we have about two and a 2.15 a around two point to a possible or just kind of a a income a.
And and if you look at a fixed income compared with our some of our peers in the in the listing on the Ishares, a Oregon, almost a volume pocs, sometimes a well we actually we hired him on.
And as a reported a number on it.
And 2.21, and I think that that will be coming on the on a sort of quarter.
And on so the price in fact, I think a we still do not have assets you know I mean, not maybe people think about we probably have a lot and much lower price getting younger a spot and the contrast is not a we actually maintain a very good pricing on compare what was our peers.
So, but it was a we still think that there's a lot to move because if you look at that a would to punch a one you're taking out the the a the last mile delivery fees to the franchisees, which we really want to help them through a true up to a total able to do a I've got a job on the accompanying comes actually a bit lower it's only about.
So that's on the IB a I'll go section to reach is a move up a little bit higher ADR for maybe 1.1 on maybe even a higher than that so so how to do that and as I said I mean primary before most Iowa.
I will volume comes from a a few concentrate a market, which has a very low a lawyer fees on.
And and in fact, our some of the regions that were doing well.
Gives a more potential could have a have a much more volumes and there has to be at much higher than he say a read that we would traditionally been doing a well on so as your question is that so we don't read a have a a let's say a a oh actually I say on how much volume a have to happen and and you know our goal is to.
As we said we want a balancing it so you know what's a profitability and the growth in a volume so so a.
So we knock on to full on while the other primary just put a lot of growth and we use our money on you know a primary want to make money, but no volume growth. So so so I think we still can have moving forward are we looking at and maybe you know plans a potential 20 percentage points of this kind of growth, but Meanwhile, you know well move on to reduce a loss and hopefully bring back to a.
Probabilities.
Di di di a the.
On the next question you had it was a Chinese a leadership on the a.
Is that a help on T.D. of course, a you know try your leadership will help the a the organization be refocusing our strategies.
In simple terms also a helping our last mile a franchisees and they have more a coffee then into the a company to see a through some kind of change and optimize and network. So both a is it is good for a full boasts a block from l. franchisees as well as for the a the whole team as a whole.
Thank you.
Again as a reminder, we like to participate in todays Q and a please press star then one on a tough some from again not a star then one to ask a question.
And next question, we have comes from BOE per day of Oppenheimer. Please go ahead.
Hi, Johnny Garcia and thanks for taking my question. So you just mentioned so for the express business. So you mentioned, we're trying to ramp up in the last comes from trading Mark has a way to have better profit is and growth a cages.
Name some of these markets and come on on the how competitive this market is a on the on the players also a pretty aggressive in this market and then my second question is a it seems we can save a lot of money from a winding down a store clause and but we all show a I think.
On a press release, you mentioned and you try to a.
At least maintaining the market share or even a growing up market share from express business. So.
Does that mean, we have to reading last a savings a into the express business going forward and try to improve the growth rate a little bit. Thank you.
Yeah, Yeah. So if you look at the a on your first question is that you know primarily in a pass a we are a if you look at all a bundle and problems this and our.
So John promise and some of the key key markets a was in a city likes and done going and so are you.
That's a primary is our you know on a concentration on the revenue come from D.C. area, a much higher even though the market has average.
And a typical reduce area has a much lower asps and also much more competitive.
And if a truly a sense do.
Yeah, the other cities a provinces, which a lot. We're a primary doing actually some up fairly well and accident on who and I honestly et cetera. On these areas actually has a a third piece on the volume spread as well as a a.
A a much higher asps compared with them with a mark I just mentioned before a so so so cost of what we see a a a on a in the area that we think at a we can do better on.
And and that has a it's a higher ASP.
The area and we will do more on the area that we think a we already have a very competitive a.
A position as well as the up at a cost and but for the <unk> a price and really low. So we probably will be moving the focus will be more to a to the area that we think we can do better on thats a balancing it but there are also a helped a balancing a network writes a transportation balance and everything else balancing that will also have a.
Optimize on improved efficiencies on the now there's a well.
On your second question is that a.
The closing down and yeah, clearly on a store plus a.
A primary we would try to in just a a time that we try to a re.
Adjusted and the focus and see where we can save them money and a put a where the on the investment was needed a certainly a on disclose the a a.
Closing the a dollar store class operation well, giving our system a savings every year and they will allow us to give more on investment and also a management time and a focus on into core business, especially on the express areas. So yes on some of the savings that we will read we put a putting to a safe and invest.
Moving to the a express business.
Oh.
Yeah. So so by investing in these areas and we are hoping that a at least will maintain or increase on market shares and.
By what I, just said about balance and now works and the and also a and continue to reduce the up the D.D. and transportation costs and and meaningful efficiencies.
Next we have a follow up from volume growth.
Oh city.
Oh, Hi, a Johnny I still have a follow on questions. So Oh. This question, maybe a little bit he a gave on Alibaba and well okay on major shareholders.
What's any buyback you are on dairy Secretary Contagion line. It now do you think it net sales for.
In a maybe a best smaller.
When it came in a smaller players a too.
To make him a jay.
And a two cents a against us junkie.
I I really cannot speak for a bubble, where they think they will do a thinking about so somebody I. Unfortunately, I have I have I cannot answer this question for a full for you.
Yeah, Yeah, but how do you think a badge <unk> do you think it on.
And you won't be a.
Oh, okay.
A walk away for that and I'm sorry.
It's just flow example, maybe for you guys and it maybe.
Maybe a T O and maybe.
And Oh, I don't know, but if you got a much together what do you think it could be qualitative data against a strong player.
Again on buying that's a question you are asking I read a have no.
I don't know how to answer this question so I think.
As a market goes you know and it's a market.
Well actually a walk out with something and self right I mean, as though at a <unk> assets from from best point of view, we still looking at you know how to improve our sales a buy we're confident that by some of these things and waiting stores and if you look at about.
A 2011 right. So if you look at 2011, our market share is only about troops and so.
Well, we go up to 20 non team a we actually achieved about getting on point on send them a market share. So actually in several years. So we actually really had a you know on gain a volume market share on it and and and and wrote a lot. So from from our point of view and and we are still continue to looking at how a.
We going to on you know optimize our network and continued chew, a how to reinvest and and operational side and getting more fishing and a continue to a true two competing a marketplace and what you're saying about a market dynamics and and and or the merger and acquisition all this stuff.
I guess, there might be a workout and itself, but on I cannot comment on or have any and foresight on what index now.
Total on the steps.
Thank you so much and.
Thank you bye.
And that's where maybe a follow up from heart and soul of Keybanc.
Yeah. Thank you all.
So I'll just a one follow up question on a ball non core and.
You mentioned a book.
And then the rest on business the.
On the capital and the global you called on it.
A claim on non core and you can you provide some color on a.
Bob each day, one or are we going into Q2.
To do a I don't be in addition to we hope and.
On sort of get your option.
In terms of operation or.
Well, that's managing on tactics, so what will be a.
On a rest of those business and because that net quite different nature, a capped on its profitable and then on.
For a job on screen battery pack on.
Oh, Okay deal a.
Loss, making so.
Just any color about how you're thinking about on a core and how do we have to go to.
Just a narrower and loss on overtime, well water handling cost growth.
Or where we have a deep and deep.
Due from fall Inc.
Okay.
The you know Inc.
Including still a plus as well as a you Carlo global a captive.
The initial plan was tried to make a a you know ecosystem to create a a Sunni geo awesome and you got to a strategy to help each other and and you know we were anticipating a a a a much competitive market share in in in the core business side. So we would and usually tied to a previous business to a true.
Have more synergy on that but given that that a competitive marketplace and we really need to refocus and so we think about you know tool to a a re evaluate our strategy and on that so we're getting to the remaining on what non core business like a capital and a you have on a global we continue looking at all.
The options right or options and could be a spin off and Toby merger and acquisition a could be some other way.
On to the goal is to minimize the the thought a loss and also public a mess Magnus time I was hoping we can refocus on our core business a site.
A specific like a new cogdell value cogdell will create a platform to really a sign on more drivers to have more efficient on.
But patient a sourcing et cetera, and so that we were more focused on the future of a just a more internal platforms to help you know free and and and expressed a forgetting war on a temporary car you see just a required but Meanwhile, you know if does anyone a was a interested and true on some kind of cooperate.
From a merchant and we can also source and they think about that global a same thing our global actually a cross border a developing very quickly on we do have lot of a synergies ways. A store was the a supply chain management as well as a.
On express I was international because there's a lot of a cross border a from tied into a China, China to be a niobium channel to true to a tight and et cetera a.
You use utilize a excess spread and that will be in China for the possibly be delivered a cracked it as well as and vice versa. You know when we have shipments a from here to truly a on to the southeast Asia being on distributed a truly to the customers.
And we are working with all the problems in the southeast Asia as well. So so yes as you mentioned so on DCE, a DISA up a business, assuming you, but and so they still will class and kept those as well as some kind of a and investment. So yes. When we look at a see if that could be a separate a fund raising.
On a separate and upon a share force or something to to getting on Mocap, those and and I think kind of step and we will have a less a a burden on T.D.D. to do it a.
Cash balance on the on the on a group.
So that that's a it kept on a same thing on kept on basically is essentially a initially was tried to help our on drivers and and franchisees et cetera and to have a easier access to capital.
But as we real.
Hi, a more cash is a into a main business a wi.
We probably had to looking at some other way to do it gathered and using our own capital do this we probably will have to using as a institutions or as a partners a cap those a true to do that or will you know so any kind of net a any kind of on.
On options on a table.
On a go just one right and just try to how to minimize.
Minimize a burden on to the a group side and that can be more a saving to investing in the core business.
And that's moving up a point just just one quick follow up on a global.
So Oh, you think a problem.
Pete on.
That would be a quote.
Global benefit from that.
Is that in there.
Maybe on near term medium and longer term.
I wasn't sure a question.
Uh huh.
Oh, hey assets as a new yeah, Oh I'm, so yeah so of course.
The new a I see the region, though a free trade agreement are certainly would have a major major support a 12 businesses in southeast Asia people, because we already see a.
And for example, a lot.
On this double 11, we seeing a lot of paso's.
Consumers on a Inc, Indonesia, and Malaysia, Singapore, Vietnam, Thailand was bought on the net.
Palbo or some of the problem in China.
We shipped a through a dara and a and it was developed to deliver a by us and the last mile. So we already see a continued a trend of two growth and a relatively high growth into cross border E Commerce related.
And possibly shipment and as well as some other kind of a on bulky items on yes, social with this a free trade zones.
And assumed I was expecting a strongly believed that it will continue to push a.
A stronger demand on book cross border needs on that.
Thank you.
Well so no further questions at this time I will go ahead and conclude the question and answer session on our December conference call back over to the management team for any closing remarks.
Okay. Thank you for joining our call and we appreciate your support a best.
Please reach out to our Investor Relations team. If you have a further questions. We look forward to speaking to you soon thank you very much.
And this is bad and missed and so we also thank you for your time also today. The conference calls now concluded a again, we thank you all for attending today's presentation. At this time you may disconnect. Your lines. Thank you take care and every great day.
Thank you.
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