Q2 2021 Uxin Ltd Earnings Call
[music].
Ladies and gentlemen, thank you for Tommy Boy and welcome to Ukraine, Onyx conference call for that.
Quarter ended September 20, 2020, other fine all participants are in listen only mode. After management's prepared remarks, they will be a commodity fishing today's conference call is being called it. If you have any objections you may disconnect at this time I.
I would now like to turn the call over to not to song Investor Relations Director or you can please go ahead.
Thank you operator, Hello, everyone. Welcome to use these earnings conference call for the quarter ended September Thirtyth and you can be on the call today are dictate our founder and CEO and Jenson, our CFO. They will reveal business operations and other company highlights followed by Jim who will discuss my name.
For those on cadence they will both be available to answer questions. During the current recession. That's all those before we start I would like to remind you that this call may contain forward looking statements made under the safe Harbor provision of the U.S. Private Securities Litigation Reform Act of 1995. These statements.
Based on management's current knowledge and assumptions about future events that involve known or unknown risks and uncertainties, which could cause actual results to differ materially from those in the forward looking statements. You can does not undertake any obligation to update any forward looking statements, except as required under applicable law.
For more information about the potential risks and uncertainties. Please refer to our fighting for the way that's easy we that I will now turn the call over to our CEO decay. Please go ahead.
I'm Jenny Hello, everyone interest for drilling over earnings conference call.
The September quarter or market share.
No we don't change the true called don't we have successfully made the transition.
Which gives us better control or other for all other flow and supply chain management. We saw were all line product and service offering deep.
Dean continues for me optimized.
We are also very page still leaves a progress we need better serving our customer adds a national one all I use current dealer.
Not only have we raised the bar E G delivering enhanced customer experience by the way also validated.
Oh for us.
We see improved.
Customer satisfaction feedback during the quarter.
Completion of our machines to true inventory on model.
Total means other unique offering all day and all I used car buying experience for those trends our ability to maximize cash.
Customer value through our dedicated approach offering.
Offer in quarterly value for money used cars alongside of besting Pos Petrossian services.
[noise] you fine Toni other products and services, we focused on three key initiatives during the September quarter, you, although to deliver better customer exposures.
First we had an adjusted used car quality by adopting a true senders <unk> selecting and he's talking cars.
And to improve the current conditions by Intel docking STENDRA and a wheel wrong data reconditioning services.
In terms of I'll call quality by leveraging the massive used car day.
Uh huh.
[noise] gathering day from Arbor, Hostelry coal car use patching and through other expense improved blessing car insurance claims over the past since for years.
We have evolved for it and extensive and deep understanding of copper from interest from so to mix and volume in relation to manufacturing day.
He takes all knowledge.
This day to driving.
No below us true effectively a huge soon.
Some type of course, we've been manufacturing defects are all relatively high cheating a range.
In addition, we also raised the afendoulis for his parking cause true folder. He should launch the cost components are all he greater share.
Lets dandyish enhanced the quality of our overall used car inventory and to allow us to get greater customer sets for touching and they trust it easy.
In terms of call condition.
Additional staff offering burford refurbishment enhance the cost like new condition.
Although our sales to consistently offer.
Customer a more.
More attractive and agreed to value alternatives for buying a new car.
Second.
When they used to have a highly.
Effective online communication course, and the message.
We.
We rest to Kentucky and are continuing to refine the process of serving our customer on line through onto the lifecycle of other pricing and other driving cars.
Let me explain once a customer place for trust older.
Older movies us there will be dedicated to service team.
Assigned to this customer.
The service team [laughter], Oh, and online sales consultant, who is responsible for handling the for China.
And the online service.
Consulting.
Sorry.
For handling all paid for walk all talking to each other for title transfer and license plate play to less efficient.
Huh.
Our total financing specialist who is responsible for processing loan of presentation related to documentation if the customer finance he's caught.
And.
And after sales manager who is responsible for.
Responding to any office hours in coverage.
I tried calling in Chinese.
For insurance clients.
After the customer drives a week he's comp.
As we standardize the way off for delivering services as each T cells and go after south point.
We significantly increase the response to that.
The response and none of our service personnel and other improved customer satisfaction as a result of our service deliver.
Good day.
We shall take the waiting period between initial order and a final deliver all for the cars Weve.
For the improved.
Entire fulfillment of process include optimization off logistic cash.
And Carter labor as well as a.
Execution of May.
More timely title transfer.
We are also introduced a new policies that the customers are.
Entirely too.
Two for certain crimes, if customer received a car later than other promise to you my time.
[noise] other resolved to off this enhancement we saw over night for promoter score.
Yes significantly increase to searching for the reported quarter from only came from the June quarter.
April April.
Even worse.
Mentioning as well that's our NPS exceeded 45 in the month of September.
Indicating the increasing.
Transition of other products and service as well as growing customer loyalty as we.
As we benefited from improved customer satisfaction and a greater.
Willingness to recommend using two others.
We are confident about weekend.
For the tour around a 1400 to deposit are required to purchase other just amongst.
Our.
Dedication to offering costly.
[noise] value for money quality value for money used car and a faster in cost per child in services.
We shall also other key growth drivers contributing markedly to satisfying the increased demand from a new group of customers, who more willing to.
You pay a premium for high quality car and it services.
[noise] capitalized by.
By these two drives.
The expansion of our customer base and the increase in.
Transaction volume does.
[noise] present us with a different to growth pass.
By we believe this new customer group has the potential to consistently contributed to our long term growth and we are already starting to receive more from China's out and from customer referrals.
Once we have the critical mass as other.
New customer base expense, we believe that customer trust and the worst what are most referrals.
We all translates into solid and sustainable long term debt.
Volume growth.
For the Solodyn other Brent.
And.
Market position.
We are confident that this will provide.
Oh from foundation.
For our for their business development and for generating more long term value for shareholders.
Yes, I'd like to turn the call over our CFO to walk you through the financial results from Keys go ahead.
Okay. Thanks, PK Hello, everyone. Thanks for joining us today as.
That's why we made the transition sooner hailing three whole model, we continue to enhance our operational efficiency across the board.
Our focus is to own a house picking used car now enable us to allocate our inspection resources to only basketball fig qualified cars in how to optimize inspection costs.
Yes. It is true we're also able to reduce sales and the relevant automated trip to expenses as we streamline our sales person by me grading every day sales that ROI.
With a fundamentally optimize the confidence to build the structure in place.
We believe that we will achieve better operating leverage in the long term as we achieve our scale.
Strength in trial in the Houston brand and a benefit from positive word of mouth referrals among customers.
Now, let me walk you through our financial details for the quarter ending in September. Please note that the results I will discuss relative to the continuing operations only.
On the numbers are in RMB unless otherwise stated also please note that some numbers I refer to our non-GAAP number.
You can find the other recalculation of December at the bottom of our earnings release.
In the three month in September Thirtyth 20, pointing total revenues were 76 million compared with 397 million units Timperio off here. The decrease was primarily due to the decreases in the to see transaction volume in JV as a result of our business model transformation we.
We operate our entire U.S core inspection our transaction process in zone me Great every sales step for begins.
Beginning on June 2020, we are now building our customer base by using online sales start as opposed to non all point to.
Our total to fee revenue was 61 million compared with 334 million in the same period last year over all I used for contractual volume was 2653 units with a corresponding to CPM repaying 293 million.
This figure includes the 308 units sold from our old inventory with corresponding to CGM be below 36 million income.
In comparison to see used car transaction volume it was for.
23500 50 million.
For unit with a corresponding gem beep in 2000 828 million a simple for a lot here.
Let no counter three revenue stream.
For our to see business.
Commission revenue was 13 million compared with 176 million in the same period of last year, primarily due to the Ukraine in non transaction volume in JV.
However commission rate decreased to 5.2% from the for email in September Thirtyth 2020 from 6.2% in the centre a lot here.
The decrease in the commission rate it was mainly because we lowered a transaction fees across the board things Auger to 2020, so as to offer more competitive price is to their customers.
Value added service revenue was 12 million compared with 158 million in the same period last year.
Primarily due to the decrease in other transaction volume and the GMB rehab take rate decreased to 4.7 per cent from 5.6% in a simple for a lot here as a result of our review service be saved over to 2020 in order to offer more competitive price to the customers.
Vehicle sales revenue was 36 million compared away from there in a thinker losses here vehicle sales revenue is recognized on a growth phase one way so our whole inventory.
We shifted to non inventory OEM model since September 2020, that's weighted deferrals in the lots of quarters earnings release.
Looking out for the business.
Other business or other revenue was 15 million for the three male and September thirtyth.
For the pointed compared with 62 million in the same period last year. The decrease was mainly due to the divestiture of our salvage car relative to the business in the January 2020.
Cost of revenue decreased by 45% year over year to your line is 3 million, but the price was primarily due to a decrease in salaries and benefits for employees engaged in the current inspection quality control customer service in other sales services.
As well as a decrease in the fulfillment cost due to the lower transaction volume.
This was partially offset however by an increase in Ob for acquisition cost relating to our beginning to building other inventory thing September 2020.
Gross margin was negative 22.4% for the for eight months in September Thirtyth 2020, compared with a gross margin of that 56.9 percentage in the same period last year.
Total operating expenses was 319 million non-GAAP operating expenses.
Expedia impact on for share based compensation were 334 million.
Sales and marketing expenses decreased by 74% year over year to 76 million. The decrease was mainly due to the decrease in the salaries and benefits.
Standard as a result of the headcount reduction and the lower marketing expenses.
Sales and marketing expenses ex crude thinly or impact of share based compensation were 76 million.
<unk> expenses decreased by 15% to 56 million. The decrease was mainly due to reserve in the share based compensation expenses.
Turning to expenses, excluding the impact of other share based compensation for were 71 million.
R&D expenses decreased by 45% to 19 million. The decrease was primarily due to a decrease in the salary and benefits expenses as a result of for the high cost reduction.
R&D expenses, excluding the impact relative share based compensation for word pointing the Atlanta.
Well from a guarantee liabilities was what meal for the frame out in September Thirtyth 2020, we incurred a guarantee liabilities associated with the remaining guarantee obligation of from our historical facilitate alone and the wear now transferred for Golden Taser.
We adopted accounting standards update 20, the paying cash third thing.
Financial instruments cash credit losses.
Our merriment other credit a lot of financial instruments on their January onest between 20, and or a modified rich off back to never before.
Before the adoption, obviously as the 326 for the gain or losses accounted for the other related to guarantee liabilities was.
With greater share of either of that and now becoming based on the l. fee for CP or the amount for determining under LP for 50.
Underwater recorded effort in non loss from the guarantee liabilities.
After the adoption of T. I see a 300 and point of sales effect for the credit loss of the contingent guarantee liabilities shall be accounted for a decent to hinder separately from the thinner ready for guarantee liabilities accounted for and are healthy for safety.
And for the provision for the confusion for guarantee liabilities is current the recorded within provision for credit losses.
And again really the from the other banner.
The other ready guarantee liability accounting for energy LP for CP is currently recorded within the other operating income.
Provision for credit losses, not for was 168 million for the three amount and.
Our September Thirtyth plenty plenty.
In order to settle other remaining guarantee liabilities.
On April 20, Threerd 2020, we enter into a supplemental agreement with one of our major financing partner with regard to our historical for political for loan.
For two and to be a supplemental agreements, where we find in the April such financing partner agreed to set a cap on the amount of cash we were used to fulfill our guarantee obligation from 20 22022.
As a result for release all for contingent the guarantee liabilities of RMB.
86 million worth we recognize the 40 quarter ended June Thirtyth 2020, representing the time value of the potential cash offshore.
Subsequently on July 23rd 20, pointing we enter into another supplemental agreement with the same financing partner to entirely tied or our remaining guarantee liabilities associated with the historical long.
For selected loans for such financing partner.
This probably meant for agreement amended and are with state of the agreements we signed in April pursuant to the agreement that we signed in July we are in entitle to settle all other remaining guarantee liabilities and already condition. The other way pay the settlement amount in the instruments from the 22.
Turning to 2025 based on a agreed schedule.
As a result, the afore mentioned previously recorded time value of the contingent guarantee liabilities in the amount of RMB $84 million was reserve.
Based on the time value of terming out to August eight 2020.
Which was the growth in day of the supplement for agreement we signed into line.
Loss from continuing operation was 100, and the $63 million compared with 188 million in the same period last year.
Non-GAAP adjusted loss from continuing operations.
Which exclude the impact all the share based compensation was 178 million compare to wait for $190 million in the same period last year.
Not a loss from continuing operations was 259 million compared with 202 million in the same PURA lots here.
Non-GAAP adjusted net loss from continuing operations, which exclude the impact of share based compensation was 275 million in the quarter compared with 200 and the for me only in the same period last year.
Turning to our cash position as of September Thirtyth 2020, we have cash on cash cash equivalent of 219 million. In addition, as we complete a new run financing offer $25 million in October 2020, we received the cash consideration in the same.
Yeah.
We supplemented our cash position.
That's some of our results for three males in the September Thirtyth 2020.
Now moving on to our guidance.
With the adoption of our inventory only model, we expect our average selling price to remaining have similar level as before and we expect our total revenue to be in a range of RMB 275 million to RMB 290 million.
And the growth margin to be positive.
And in a single digit percentage range for the December quarter 2020.
And away if we continue to improve the overall operating efficiency. We also expect our adjusted loss from operations to narrow slightly from the September quarter.
This forecast reflects our current and the primarily a view on the market and operational conditions, which are public subject to change.
That concludes our prepared remarks.
Thank you mr., okay, well like to open the call for questions now.
Certainly ladies and gentlemen, we will now begin the question and answer questions to ask a question you May proceed star one.
On that day, claiming to be among the catalytic watch any other hatched.
Once again for luck a question. Please press star one telephone.
Hello first question coming from the line, Okay EBIT Wong from Morgan Stanley. Please go ahead.
Hi, decay, Michael and Anthony. Thank you for taking my question, what can go down or went to some gun Gandhi from guys. How deep interest to show a kinda talk about emerging growth soon for us to transform the way for the holiday.
But that's your book news interest at Heart just for 2001, just to let them go down, but then Dr. Pellets for that's always our doses for the.
Hello, Michael them Academy also true or do you have to take a 10 go down the fact that for sure system younger constituency that wants to dose or GAAP had negative hit it off in border for woman side, Jager, a pension and cash no Kobe from digital Britain.
Cash day temperature range I disorder wall, so instead of adjusted our whole kind of what the other half where you always shift gears lets it habits for sure, which it would cindat JV or co who youre for corporate from him the trigger to what you saw that stage readjusted and go from there are a whole what kind of get them find yourself.
Thank you for taking my question I have two question. The for US first question is about the outlook of the a used car industry in next year.
The second question just that you mentioned you have been doing a lot of efforts to improve the overall you know NPS score.
And for the year that spirits, so going forward or what kind of you know the efforts. We will continue to to do to further improve just a you know do you have experience in terms of the UBS yet thank you.
Okay. Thank you Andy Alright.
Other changes to cash use so first of all other industry.
Just recently, China Auto dealer Association.
Okay.
And in time indicated several used car policies signs from here.
He just industry environment I think it will be a new star for the used car industry next year.
For the whole sections, you mean force do for compliance for me is relevant E. coli policies.
For the implemented and upgrading.
This will enhance the ensuring that's true to develop the from a used car brokerage model award for two or more organized the business model, we are participating as more regulation [noise].
Currently.
Used car BHP tax.
He has already been cost from 2% ourselves to your 0.5%.
For the same time there are also some day.
Has been seen politician relating to wacko temporary.
Happens for me the registration and the title transfer.
[noise] and we can see.
RPG introduced a new license.
Planted other patient policies earlier this month.
The pilots you see I believe BG wear lounge and.
Employment spices day plans next year as a response to Dave's policies massive so.
So there will be a favorable government policies in place and biography to in time intuition carried out by a talent city as a reference for other cities and originals to learn from.
We have developed a share in regulatory compliance the engines on implementation of policies will remain positive change.
True they used car industry, including higher engagement, Java, and Thats true tires and cash.
Passengers to high acceptance of buying used car.
I did it change you will gradually.
Two taking place.
[noise] from what we have seen currently all day three policies will benefit from Michigan.
As we now operate as the online U.S GAAP.
First.
As a business entity other adoption all saw inventory on model will be fully supported by the policies.
In addition, the U.S contact Scott can also help to lower our tax expenses.
We when we are operating under the inventory on model.
For the for promoting off well contemporary property in restitution and.
Digital night vision of the title transfer process.
We also significantly since.
Simplify the fulfillment of process as customers for Chinas used car all line from us.
Which will lead to a much improved deliver range.
Oh the efficiency.
For the same time, rather than just fulfillment to cost debt can also be optimized corresponding today. So I think to total all this policies I think it from next year. They used car. The total day transaction volume could it be increase and go from other for Cascades around a two day to digital.
Around the 10% to 15%.
And so that's it that's the onset for me first question and the second tranche and about MPS improvements I think last year, we were really standard sound.
The efficiency ratio improved.
MPS.
I think we.
Well I'm going to focus on the two as PPACA quality and and the condition of use cash and back to E. Com tit for Tat Conservative there's two things is the most.
Sensitive to improve the NPS. So next year, we are taking to enhance our ability and ER and the losses.
So for us investing easily two area and we believe that I think in Q2.
He has some sense detection and also improve the MTS.
Yeah, and I want to see some more Oh for example.
We will.
We're focused on strengthening our ability to recompletion in the car. So next year, we will be.
Due to our own the reconditioning center to enhance our refurbish ability.
From using our sales.
And there are two bringing the the like new condition the.
Used car to to our customers.
Yeah, I know that's a that's a second question and answers.
Thank you Andy. Thank you. Thank you okay. Thank you very clear thank you very much.
Thank you.
Thank you.
Thank you I would.
I think on the call over to not for song.
Oh for.
Lots of good luck. Thanks.
Thank you again for joining our call today and for your continued support and any other sure well look for other anticipate Andrea sales.
In the future. Thank you.
Thank you it sounds like your conference for today. Thank you for your participation.
You may all disconnect your line.
[music].
[music].
Ladies and gentlemen, thank you for standing by and welcome to Yolks Inc. earnings Conference call for the quarter ended September 30, 2020. Other sign all participants are in listen only mode. After management's prepared remarks, they will be a commodity session. Today's conference call is being caught it.
You have any objections you may disconnect at this time.
I would now like to turn the call over to Matthew song Investor Relations Director of Exane. Please go ahead.
Thank you operator, Hello, everyone welcome to years past I missed conference call for the quarter ended September 30 at any time to other call today, I became our founder and CEO and came from our CFO.
I will review our business operations and company highlights followed by Terry will discuss financials and guidance. They were both be available to answer your questions. During the <unk> session that follows you.
Before we start I would like to remind you that this call may contain forward looking statements made under the safe Harbor provision of the U.S. Private Securities Litigation Reform Act like for like you buy. These statements are based on management's current knowledge and assumptions about symmetry that involve known or unknown risks and answered.
For me, which could cause actual results to differ materially from those in the forward looking for talent you have seen does not undertake any obligation to update any for his failing except as required under applicable law for more information about the kind of risks and uncertainties. Please refer to our filings with RBC.
With that I will now turn the call over two hours per yard PK. Please go ahead.
Second NZ Hello, everyone. Thank you for joining our earnings conference call today.
The September quarter or market share average concession to inventory model.
No. We are pleased to report that we have successfully made that transition.
Excuse us better control over order for our other flow and supply chain management.
These are all line production and debt service offering being.
Being continuously optimized.
We are also very tasty always a progress we made better serving our customer adds a national line all I used container.
Not only have we raised the bar in Gi delivering enhanced customer experience by the way also validated.
Our efforts.
Hi, receiving improve cost.
Customer satisfaction feedback during the quarter.
The completion of our machines into inventory on model.
Couple other wins, our unique offering all and all I used car buying experience.
For the strength of our ability to maximize cash.
Customer value so our dedicated approach.
Offering quarterly value for money used cars alongside a best in class Patronising services.
[noise] you find toning other products and services, we focused on three key initiatives during the September quarter, you other to deliver better customer experience.
First we had an adjusted used car.
Other team by adopting a certain senders in selecting and is passing cars.
And to improve the current conditions by Intel docking STENDRA and we're wrong data reconditioning services.
In terms of current quality.
Other region, the massive used car day.
That's right.
Gathering data from other hostelry coal car is patching and that's true other extravagance in progressing car insurance claims over the process for years.
We have evolved from it and extensive and a deep understanding of copper from is from certain makes and models in relation to manufacturing day.
Hey, Thanks, all knowledge.
This day to driving.
No allow us to effectively a huge soon.
Some have all cause with manufacturing defects are all relatively high senior range.
In addition, we also raised the standards for opting cause true folder. He should launch the cost components are all in greater share.
Lets standard has enhanced the quality of other overall using current inventory and to allow us to get greater customer satisfaction and interest it easy.
In terms of current condition.
Additional staff offering burford refurbishment enhance the cost like new condition.
Although our sales to consistently offer.
Customer a more attractive and a greater value alternatives for buying a new car.
Second we will use the off a highly.
The effective online communication clause and a masters.
We.
We rested Kentucky and are continuing to refine the process of serving our customer on line. So obviously the lifecycle of other pricing and other drugs cost.
Let me expand once a customer plays out.
Oh that leaves us there will be dedicated to service team.
Assigned to this customer.
The service team consisting.
Oh, Yeah, all line sales consultant, who is responsible for handling the purchase order.
And the online service.
Consulting.
Sorry.
So handling all paying for walks all documents for title transfer and license plate planes for less efficient.
Huh.
Total financing specialist who is responsible for processing loan application related to documentation if the customer finance these costs.
And.
Yeah after south manager, who is responsible for.
Responding to any office hours in Congress, such high concentrations for insurance clients.
After the customer drives a week he's car.
As we standardize the way off for delivering services at each T cells and after South point.
We significantly increase the response to that.
Response, and none of our service personnel and an improved customer satisfaction as a result of our service deliver.
[noise] surge.
We shall take it the waiting Chile other between initial order and a final deliver all the cars.
We further improved the entire fulfillment of process include optimization off logistic a cat.
And a car to labor as well as.
Execution of.
More timely title transfer.
We are also introduce a new policies that the customers are.
Entirely too.
Too so searching times, if customer received a car later than other promise to you my time.
[noise] other resolved to off this enhancement we saw other nights for promoter score or NPS significantly increase just searching for the reported quarter from only came from the June quarter.
April April.
Income wars.
Mentioning as well that's our MPS exceeded 45 in the month of September.
Indicating the increasing.
Fishing and other products and service as well as growing customer loyalty as we.
As we benefited from improved customer satisfaction and a greater.
Well any names to recommend using two others.
We are confident about weekend.
The tour around 1400, you deposit are required to purchase price out there just amongst.
Our.
Dedication true offering costly.
[noise] value for money quality value for money used for car.
And faster in cost per child and services.
We shall also other key growth drivers come for duty to markedly to satisfying the increased demand from a new group of customers who more vinny.
To pay a premium for high quality car and in services.
[noise] catalyzed.
By these two drives.
The expansion of our customer base and the increase in.
Transaction volume does.
Present us with a different to growth pass.
By we believe this new customer group has the potential to come.
Consistently contributed to our long term growth and we are already starting to see more current trends out there from tons from a resource.
Once we have the critical mass of our new customer.
<unk> expense, we believe that customer trust and the worst what almost referrals.
We all translates into solid and sustainable long term debt.
Volume goals.
For the Solomon other Brent.
And.
Marching to position.
We are confident EPS this will provide.
Oh from foundation.
For our for their business development and for generating more long term value for shareholders.
I mean, Josh I'd like to turn the call over our CFO to walk you through the financial results Junkies go ahead.
Okay. Thanks, Okay, Hello, everyone. Thanks for joining us today as.
That's why we made the transition to an out Halo three wholly model. We continue if he has other operational efficiency across the board.
Our focus is to own a house picking used car now enable us to allocate our inspection resources to only basketball fig qualified cars and how to optimize inspection costs.
In addition, we're also able to reduce sales and the relevant automated treated expenses as we streamline our sales process by me grading every day sales that all line.
With a fundamentally optimize the content depends a structure in place we believe the other way well achieve better operating leverage in the long for after we achieve a scale.
Strength in trial in that you shouldn't Brian and a benefit from positive word of mouth referrals among customers.
Now, let me walk you through our financial details for the quarter ending in the September. Please know that the results I will discuss relative to the continuing operations only all numbers are in RMB unless otherwise stated also please note that some numbers I refer to our non-GAAP number.
Finally, a recapitalization of December at the bottom of our earnings release.
In the three month is in September Thirtyth 2020, total revenues were 76 million compared with 397 million in the same period last year. The decrease was primarily due to the decreases in the to see transaction volume in JV as a result for all of our business model transformation.
We operate our entire used car inspection our transaction process ends on me Great every day, so step out for begin.
Beginning in the June 2020, we are now building our customer base by using online sales start as opposed to non all quite sales team.
Our total to see revenue was 61 million compared with 334 million in the same period last year. Our all I used for transaction volume was 2653 units with a corresponding to CGM between 293 million.
This figure includes the 308 units sold from our old inventory with corresponding to CGM be below 36 million income.
In comparison to see used car transaction volume it was.
23500 66 million.
Unit with a corresponding Jim Beep in 2000 828 million in the same period last year.
Let no counter three revenue stream.
For our two C business.
Commission revenue was 13 million compared with 176 million in the same period of last year, primarily due to the decrease in non transaction volume in GMB over commission rate decreased to 5.2% from the females in September Thirtyth 2020 from six.
0.2% in the centre at loss here.
The decrease in the commission rate it was mainly because we lowered a transactional fees across the board things all goes to 2020, so as to offer more competitive price is to their customers.
Value added service revenue was 12 million compared with 158 million in the same period last year.
Primarily for you to be a decrease in other transaction volume in the GMB, we have take rate decreased to 4.7 per cent from 5.6% in the same period last year as a result of our review services be saved over to 2020 in order to offer more competitive price to the customers.
Vehicle sales revenue was 36 million compared with meal in a simple last year vehicle sales revenue is recognized on a gross basis went away so our own inventory will.
We shifted to non inventory only model since September 2020, as Weve disclosed in the lots of quarters earnings release.
Looking out for the business.
Other business other revenue was 15 million in ER for the three males and September Thirtyth 20 points compared with 62 million in the same period last year. The decrease was mainly due to the divestiture of our salvage car related to business in the January 2020.
Cost of revenue decreased by 45% year over year to your line is 3 million, but the price was primarily due to a decrease in salaries and benefits for employees engaged in the current inspection quality control customer service in other sales services.
Well as a decrease in the fulfillment cost due to the lower transaction volume.
This was partially offset however by an increase in Shelby acquisition cost relating to our beginning to building other inventory thing September 2020.
Gross margin was negative 22.4 per cent for the three month in September Thirtyth 2020, compared with a gross margin of that.
Oh, 56.9% in the same period last year.
Total operating expenses was 319 million non-GAAP operating expenses, which exclude the impact of share based compensation were 334 million.
Susan the marketing expenses decreased by 74% year over year to 76 million. The decrease was mainly due to the decrease in the salaries and benefits.
The other resolve the headcount reduction and the lower marketing expenses.
Sales and marketing expenses ex crude thinly or impact of share based compensation were 76 million.
<unk> expenses decreased by 15% to 56 million, but the price was mainly due to reserve in the share based compensation expenses.
<unk> expenses, excluding the impact of other share based compensation were 71 million.
R&D expenses decreased by 45% to 19 million cookie pray for whats been primarily due to a decrease in the salary and benefits expenses as a result of for their high cost reduction.
R&D expenses, excluding the impact of the share based compensation were 20 million.
Well from a guarantee liabilities, what what meal for the frame out in September Thirtyth 2020, we incurred a guarantee liabilities associated with the remaining guarantee obligation of from our historical facilitate long and were now transferred for Golden laser.
We are not the accounting standards update 2015 Dash third thing.
Financial instruments that credit losses.
Americans on for credit losses on financial instruments on their January Onest for 21 and are a modified we talk back to never before.
Before the adoption off yeah, I see 326 for the gain or losses accounted for the other related to guarantee liabilities was.
Fourth grader of either of that and now becoming based on that he has seen for 60 for the amount for determining other LP for 50.
Ana was recorded effort in non loss from the guarantee liabilities.
After the adoption of T. I see a 320 sales effect for the credit losses of the contingent guarantee liabilities shall be accounted for in a decent too and separately from the dinner ready for guarantee liabilities accounted for and are healthy for safety.
And the provision for the confusion for guarantee liabilities is current for recorded within provision for credit losses.
And again release the from via a scanner ready guarantee liability accounted for energy LP for CP is currently recorded within the other operating income.
Provision for credit losses, not for was 168 million for the three amount in our September Thirtyth, a 2020 yeah.
In order to several other remaining guarantee liabilities.
April 20, Threerd 2020, we enter into a supplement for agreement with one of our major financing partner with regard to our historical for quality loans.
Pursuant to the supplemental agreement, where we find in the April such financing partner agreed to set a cap on the amount of cash we were used to fulfill our guarantee obligation from 2022 2022.
As a result for release of for contingencies, the guarantee liabilities of RMB 86 million worth we recognized for 40 quarter ended June Thirtyth 2020, representing the time value of the potential cash offshore.
Subsequently on July 23rd 20, pointing we enter into another supplemental agreement with the same financing partner to entirely side of our remaining guarantee liabilities associated with the historical loan.
For Silicas alone for such financing partner.
There's probably meant for agreement amended and are with state of the agreements we signed in April pursuant to the agreement. We signed in July we are in entitle to settle for all other remaining guarantee liabilities and already condition. The other way paid the settlement amount in the is true month from the 20.
20 to 2025 based on a agreed schedule.
As a result, the afore mentioned previously recorded time value of the contingent guarantee liabilities in the amount of RMB 84 million was reserve.
Based on the time value terming out to other 820, 20, which was the growth in day of the supplemental agreement we signed into line.
Loss from continuing operation was 163 million compared with 188 million the same period last year.
Non-GAAP adjusted loss from continuing operations.
Which exclude the impact all the share based compensation was 178 million compare to wait for 190 million in the same period last year.
No loss from continuing operations was 259 million compared with 202 million in the same PURA lots here.
Non-GAAP adjusted net loss from continuing operations, which exclude the impact of share based compensation was 275 million in the quarter compared with 200 for me only in the same period last year.
Turning to our cash position as of September 32020, we have cash on cash cash equivalents and.
219 million. In addition, after we complete a new run financing offer $25 million in October 2020, we received the cash consideration in the same manner.
We supplemented our cash position.
That some of our results for three Mount in September Thirtyth 2020.
Now moving on to our guidance.
With the adoption of our inventory only model, we expect our average selling price to remain in a similar level as before and we expect our total revenue to be in a range of RMB 275 million to RMB 290 million.
And the growth margin to be positive and in a single digit percentage range for the December quarter 2020.
And away if we continue to improve overall operating efficiency. We also expect our adjusted loss from operations to narrow slightly from the September quarter.
This forecast reflects our current and the primary view on the market and operational conditions, which are public subject to change.
That concludes our prepared remarks.
Thank you mr. from okay, well that to open the call for questions now.
Certainly ladies and gentlemen, we will now begin the question and answer question to ask a question you May Press Star One I think what was going on day, claiming to be amount for catalytic lets me, Chris Rondeau hatched.
Once again for luck a question. Please press star one telephone.
Hello.
Since coming from the line of it the volume from Morgan Stanley.
Okay.
Hi decay Michael answer. Thank you for taking my question what can go them for the wet season, a gun Gandhi from goes out either interest to show a kinda talk about inject garage sales for us is on sort of way for the holiday.
But that's really good news for interest it's not just for 2000 <unk> just to let them go down but the entire book that's Ahmadinejad doses for a detailed Michael them Academy also tried to go from here the trigger some color on the five day versus just the beyond that to still go into debt. Once you go so cotton negative hits it off in order for woman side to go.
Susan I'm kidding, no Kobe from digital book.
So day to bigger ways I just saw the wall. So instead of adjusted for kind of what other halfway though it should be but should habits for sure what changed with the industry growth Copel Youre for corporate if I'm going to take a true if what you saw on the stage. We are just you didn't go from there are a whole what kind of get them find yourself.
Thank you for taking my question I have your question are there for US first question is about the outlook of the a used car industry in next year.
The second question just that you mentioned you have been doing a lot of effort to improve the overall you know NPS score.
And that the year that spirits, so going forward or what kind of you know the efforts are a continued true to do to further improve just as you know the user experience in terms of the UBS yet thank you.
Okay. Thank you Andy Alright.
Other take these two questions. So first of all other industry.
Just originally China Auto dealer Association.
Okay.
And the implementation of several used car policies signs from here.
He this industry environment I think it will be a new star for the use current industry next year.
For the whole section she moving forwards do.
For compliance with relevant E com policies for.
Other implemented an upgrade.
This will enhance the ensuring that's true to develop the from a used car.
No change model towards a true.
Organized the business model, we are participating as more regulation [noise].
Currently our used car V.T. tax.
Already being cost from 2% ourselves to your 0.5 per cent.
For the same time there are also some.
He has been seen policies for relating to wacko temporary happens for me the registration and the title transfer.
And we can see.
RPG introduced a new license.
Planted other patient policies earlier this month.
As a pilot a city I believe BG wear lounge and.
Employment spices day plans next year as a response to Dave's policies massive.
So there will be a favorable government policies in place and buys it for you to in time interest in carried out by Parliament City as a reference for other cities and originals to learn from.
We have developed a share in regulatory compliance and each time indication of policies will remain positive change to the used car industry, including higher engagement, Java, and Thats true tires and customers to high acceptance of buying used car.
If I did it change you will gradually.
To taking place.
[noise] Oh from what we have seen currently all day screen policies will benefit from <unk>.
As we now operate as all our U.S GAAP.
First as.
As a business entity other adoption for inventory on model will be fully supported by the policies.
In addition, the U.S contacts cash can also help to lower our tax expenses.
We when we are operating under the inventory on model.
For the for promoting off well contemporary province in restitution and.
Digital night vision of the title transfer process.
Well significantly.
Simplify the fulfillment of process as customers for Chinas used car all line from us.
Which will lead to a much improved a deliberate.
The specialty.
For the same time, rather than just fulfillment cost. It can also be optimized corresponding to me. So I see two total all this policies I think it from an accident year. They used car. The total day transaction volume could increase and go from other for Cascades around a two day to digital.
Around the 10% to 15%.
And so that's a that's the onset for me first question and the second question about the NPS improvement I think this year, we we really standard sound mainly efficiency gains improved.
Yes.
I think we.
We are mainly focus on the two S pack to quality and and the condition of use cash and back to E. Com. So per child Conservative. There's two things is the most sensitive to improve the NPS. So next year, we are taking to enhance our ability.
And ER and ER.
The shares investing easily is true area and we believe that we can keep too.
He played a custom sensor tension and also improve the MTS.
Yeah, and I want to see some more Oh for example.
We.
We're focused on strengthening our ability to recompletion in the car. So next year, we will be.
Due to our own the recommendations interest to you.
Enhance our refurbish ability from using our sales.
And there to bring the the like new condition or the.
Used car to to our customers.
Yeah, I know that's a that's a second question and answers.
Thank you Andy. Thank you. Thank you okay. Thank you very clear thank you very much.
Thank you.
Thank you.
Thank you I dunno.
I think on the call all the time for song.
For any closing remarks from too.
Thank you again for Tony are it's hard for day and for your continued support any other so well look forward to speaking here for a in the future. Thank you.
Thank you that's going to look for conference for today. Thank you for your participation.
Yes.
You mean, all this comes from.
Right Okay.
Okay.