Q4 2020 Ehang Holdings Ltd Earnings Call
[music].
Good day, ladies and gentlemen, thank you for standing by and welcome to eat homes fourth quarter and the full year 2020 earnings conference call at the.
This time all participants are in the listen only mode. Later, we will conduct the question and answer session and instructions will follow at the time.
As a reminder, we are recording today's conference.
If you have any objections you may disconnect at this time no.
Now I'll turn the call over to Julia Qin <unk>, managing director of the Blue shirt Group Asia Mischance. Please proceed hello, everyone. Thank you all for joining us on today's conference call to discuss the company's financial results for the fourth quarter and the full year of 'twenty 'twenty. We've released the result really today.
The press release, there's the variable on the company's website as well as strong newswire services on the call with me today on Mr. Hu, Chief Executive Officer, Mr. Edwards, Shea Chief strategy Officer as of Mr. Richard Liu Chief Financial Officer before we continue please note not to these discussions.
The walk contain forward looking statements made on the safe Harbor provision of the U S. Private Securities Litigation Reform Act of 1995 forward looking statement of involves inherent risks and uncertainties as such the company's actual results may be materially different from the expectation of expressed today.
For the information regarding these and other risks and uncertainties is included in the company's pump refining with the SEC. The company does not assume any obligation to update any forward looking statement, except as required under applicable law. Please note that today's call management will also.
Discuss certain non-GAAP financial measurement for comparison purposes, the only our GAAP results and the reconciliation of GAAP to non-GAAP measures can be found the in our earnings press release also please note that unless otherwise the state all the figures mentioned during the conference call on.
The Chinese RMB with that let me now turn the call over to our CEO, Mr. Huang to Mr. Hu of speaking Chinese and then all of a CSO edible she would translate his comments to English. Please go ahead Mr. Hu.
The other alcohol, what's the Johan Sverdrup larger.
Cause here that got hung up on London, and the deal hopefully.
On a simple.
Simple peoples on the India, well hooked on good while it one day, you'll kind of vehicles of the soil. The gunkel much income share of law it will.
For you guys here of a woman of soil of the food well hold on what holds true on the Fisher.
Fisher Ginger well chapter of that you were that got to the chute jumped out of you all.
Sure sure well get that that sounds out of woman of the good too.
So I'm trying to defend share her daughter will you hold the guns in dogs for some of them.
I didn't hear what else. She told the treasuries are you on the from you.
It doesn't you.
I don't I gotta, considering some of the larger y'all know the U haul of Moshe.
On the chapter of whole woman of the way life.
So I want the syndrome, you call generally the laid to you on one of the good and the new administered of cultural infusion pumps.
From a cultural true Hill, Florida for sure.
For the job Chefoo torsion shoot on the cold on journal of Joe's home getting true for people from juncture, the usually shy of that a little of hot.
Hold on Joseph on sort of linked the outlook.
Well the net shoot.
Moving on maybe you go to then build ourselves for the Dongguan Guangdong, Joe on the benches of the literature.
While much of that way of life, but you have other alternatives corridor of the proof of life.
She'll worry on screens, yet actually on the corner on tools, which will for sure.
Each of them on the bench of Columbia all at home.
While I'm on the Congo for you don't need them in the short or if you go on pins here.
Woman, that's the allergy Joel Triple you harvest from you.
Moving to Cuba, do you want the way like the old home try any of the trials useful call for that.
The Hall Yorkshire to share publicly.
One of my really that's little Josh for quite a little further on the truth yourself for.
So I'm totally of gel totality of the Hudson jumped on it from good triangulate that they've got the photonics area because of the Jamba.
Tell me for trying sort of you.
Joe the whole food apologize, yeah, we will for Lora for investors.
Right so for.
For the you'd be hard to flow.
And the gel Congress will try it.
Culture of combed on Gild Hall for the Chicago Cheerleader for the got quite U haul, you'll just totally harmony of the Pea Nieto true.
Well, that's not neither agenda of bogo the audience sitting in trench of total company sales on that should hopefully more of jumped out of it you don't what you make that one of the shelves you Johan will go totally.
And the true for the linked Ginger.
Nacho cheese on shelf valuable finish it off of the law.
Woman that of course, you just heard entities would you like her time in function.
Your true, finishing soon for the leash on for your mobile.
Xiaomi of Wandell G for Greensville hofuf feels about like the thought that sounds on Johan <unk> rely the thought of losing share.
Yeah people for.
The targeting of outcome here with Michael.
On the new jobs on the photo so do you want me to go on ton of somebody yet.
We're in Joshua.
Charlie the Sun seeds from country.
The homeowners have major E Hangzhou parcel.
Although one of them talked interest youthful colorful shuttle to unleash it on the wireless frequencies of home Dalhouse she's on the true based on shortly.
The real cause she called food offer of food you don't create tissue facing with very little true.
For your bundle of warranty of use for one term bought on them.
Well on the Celgene it seems like hung out window of the phasing for sure she's on.
Hi, Bob what the allergy shots for sure broker channel leads you don't posture of battle going on but you don't see them Hi, Danielle on June <unk>.
Hyphens items for sure Tinsel 10 dogs of for them.
I believe we'll figure out kind of share you don't pay a woman saltwater disposal for that.
The time it pays all of the ones who are battling on the salt you're going to build all of harm on the politics.
That means the orange itching at one time, you hardly granting of the evil.
Torture, telling you all talked about on the defense you almost of agenda in the total of who you are she told piece of the general.
One of the Tianjin It all the time here. So you go you'll Kate Hudson the change in the Joseph a.
People are facing on the price.
Our share can be eagle for Torrance Eagle the timing.
How are you doing the other ones unless she couldnt for at home.
Well the internal Joshua for young children on the Leawood.
While the tradeoff for Egypt.
All of who love it for the Jumbo the Wheeler of criminal Joe talks the she thought from <unk>.
For the Orange itching are generally lots of G. The yes, the trends hold up the Eagle Award and Joshua relationships with the other launching.
One of the Bulldog, you'll watch each in Congress for the quality of.
One of the really teach from Congress hook wildly, yes, the way of life and gaining the Toyota.
On my Ultra who the other items in the teaching while he was on Joshua jump on the annual call for you.
C J on the quality of its I'll touch on the street out of Aquila.
So you shouldn't Congress the quality for where the woman's look wrenches I'll wait till the good tee sheet allow the G for poker, you're Python Fujitsu chapter of the woodlands he'd been the Valeant for hope we're in Congo will go go I told me all of the for the harsher torrential you'll rambling treats all in the sort of quantify on kind of your I'm not sure. If it went on.
The Gulf of the.
Well the go on in the sort of a whole range of the tongue.
For hardcore cool on May go channel that the but Colorado from Laguardia arc hydraulic from daughter survey of Little me for well my fingers, the owner of a downtick machine for the number one none of them.
Kind of weird I tell the home of bids yet.
So the on in each area of Montreal Headroom for me of how would you cut out of usually of the huddle consulting World Congress, Joe from Goldman Sachs with all of the Orange you buy you get all of them both out of share for you're facing shoe called the buzzer on all of the sidewalks range from sugar, sorry about junior Ehealth eye on either side of show homes.
The infill shortly I mean all of us.
On songs you thought the foundry the EG me the passage of one of the Tango two of that channel here almost all kind of me of how would you the economy from jobs for the house anyway, John for General shouldn't think Jade one woman until that wouldn't bother tweaking on iron ore.
The other for Hunter on the Chinchillas.
Sure Yeah sure the womens arent you balance kosher food for want of a woman who doesn't seem that the ARPA.
For the Allomap, who goes on in jumbo, what because of lot of uncomfortable Joshua Hall, because a lot of jump on that make sure Arthur can.
Are you going through the code on switching pool.
The higher you Humphrey it's all join me on my condolences on the I should say of how the furniture to for to go.
Two of the code on switching for Pincher juncture to the senior North East, we entered the year and it didn't hit all of them.
On one Shanghai to you on simpkins on totally torrential engender.
For what he works out.
Sure Josh of woman through it she on the hunger and deal with the sample.
Chime in.
I got you on that a woman's Union that's hungry.
So all of the calling until the 10 handle on the cash hold all of the woman of shutdowns on the way like the at home you want me out of it.
You have the hunting sheet on channel they'll do a finance who the other coupled with the pool for hotels.
I don't know of silence use the little geographies into the chief water on the two.
Virtually all the Eiffel Tower E.
L tissue.
<unk> has lots of little geography on sheets of homegrown shalwar, Bob I don't hold on to controlling the the email Italian for.
The tranche of Conan gelatin, one hope would you from your womanhood Iona I'll tell you of efficiency you should change holding mention you didn't jubail of tranche of edge out home on Italy.
One of them on local hometown of less useful for months, you don't push where you can share summit on Ito Hunter on the Xinjiang.
So at the country, which I'm sure Jim on all of the Port from you.
You should any of the I only of Jetblue.
Partially all of that chunk of it shouldn't named one of the challenges agenda Jolson Jebel sure weighted either tranche of corner, which I don't want to go with Dr. Chang for.
For a lot of shops.
The Caribbean from here it sounds like the absolutely for suddenly from base of the pool.
Sure, Yeah, well photon counting on the sometimes Garcia from yesterday's for the Shanghai Concord woman of the weight issue the account how hungry the channel facing she doesn't know about in the total.
On the inter on material for July you wait he said at the time he ever functions for the Bachelor easily lead he all of them with the Orleans of weight is all of them, where do you see the Sri which wouldn't be on the door for any job coding either for you shortly.
With the filing should wait tissue that we flagged in our chassis the champion.
The insurance for shell leadership of shop all of us.
And on the onshore.
Weighted selling champions geology of the cotangent suddenly cut you of all Fuji type utilization for shampoo, the Cushing to the all of the Chipotle trades, which are done at all of that.
Switching quite a bunch of them hook orange on the battle net.
While non single of shutdown on your daughter's since the end of blood draw.
Ursula English of the change of our sort of shortly.
We don't do the industry won't try on the caution for oil on the tongue Judy the efficiency of shows.
But she'd have literally all of the Los Angeles Zimbra quality each of the other Fuji the all of US that's the loyalties and Watertown cube of ones of the phasing of suddenly are for her you should see the golf boardroom that flow of the fishing motors, how do vary widely on the facing very familiar.
What are the and Joshua for did you pay for the living without eating for the other.
Kindred and I'm sure to be jumped that she should hold the facade.
The ultra cool Donnelly of that Houston, where the Doctor will surely the T Force Paul don't put her swish of fishing show you one of the figure you said you saw the child Hachioji should hopefully it doesn't keep turning a corner of that ship I believe any day now for Youtube.
Lately on how the basically the the button you of torture of Jubilee on how the challenges facing really.
Well I went through the Doctor Chan your mates the totaled one of the teach out far more physical Julie that off the back only the student housing sales.
Sales into the total woman of the way the filing.
Failed who kit.
Yeah, we woman weighted out of what would have been the dry listen Phuket, Penn, Virginia, Louisiana, and I'm sure the pool Tinchy cash have been down.
On that don't go the Shire pool since you kind of what the retrofit Judy for easy the white wine, especially on the other casual since and see that on the do it yourself the chunk of survival.
The auditing for really all of them I'm sure on the Palm laser welding, while I'm on the oil to the Celgene for Ya.
That's all true with your earnings higher military agencies on a fishing shooting fish in getting from the ruble Moorhead issue of waters in terms of the champion Yeah, Chinula shops, you're not allowed to travel to your line.
So I don't have a physical shazam trouble of sellers all true true household of which you should all of your box of only made all share the.
As a way of life potential non redesigning the trends of the old facing the policy on contract with quadrant touch of Wheeler U M of.
G for we have called on rope of cohort should accompany.
He had hoelscher cause you only the woman, that's true, which hundreds of balloons in the orange email.
On the identifiable iota of that.
I will share their time here.
Because when you call out can you show those out for the time here.
The junior Weird name she doesn't want me of hundreds by the other yeah less all of them.
How do you find the indulging dental the frequency.
Oh, you're trying to drill on the shelf, so that's helping sheet on that.
That comes out of agenda on call.
Torture, you didn't you still don't cash from Russia for the chair of only the on jumbo.
Of that tenure, while material not all of the Trimble I mean, how do you feel on the above how the three garden G. The soundly against the the way of life should hold or sell.
Settlement at the end of the when she talked about on Egypt. She phasedown of law cliffs, you're facing conjecture on what's your hot we line you'll have any she generally the on terms of Wheeler from B, the fishing TLO, yet, although that Jim will share for sure don't hold them on the facing of Louis you you got to make good on the shingle the facing of Mone.
And what was I heard all of those all of the wounds you will go she golar share routines.
U haul freight harshly of trends along she's out of Julio couldn't eat the 91 till it usually of probably on the fishing pusher estrogen biopsies for the songs Chile. The one times you on what the trends of the inflation.
Oh, where engie will go home at the Eagle would interest or the wounds Utah.
Torched it on wastewater in the U S Congress she's on the Union single Mail you got hold of the soil for agency Tremble your true at the other she talks of the donation.
The Shanghai, So again for all of them Yeah, Let me ask you the other cushy that ginger.
Shows you one of the Guangdong beautiful of told you on the Shanghai G. D C. Other junior lawyers and people should hold on yeah.
Of the timing junior for tied out sort of of juggled to tighten up.
It was high time finish on time, that's one of hometown boy of torrential on from that.
In Hungary for G D G on the way the long end.
So they should hold true.
For the abortions yourself, a little harsh on house and the trends in on sort of how water Gulf of Genie boutique all champion of Treehouse interest him.
While non Shanghai, Guangzhou open for Kodak's Angela true.
He'll share against how do the children, who will cover the other transiently et cetera of retention.
Xiaomi, moving well with us and we like the father of losing.
On the jumped on board shops for the channel you're losing share on woman that's only on mobile.
D.
The two jobs items, so all of the attempting the yen for you how are all of a bunch on shuja how long she we teach how how do you how long she the young Farquhar Cushing.
For Union with offshore childlike enhance usual her time in the BLA.
Tons of why does that in terms of the entrance of schuh hunting outside Cook sorry on the leap.
The are you in general you Angela Gordon emailed in type one day.
On GDP doctoring cleaning <unk> hygiene Xiaomi channel it anyway.
Cause of true bushes, yet you'll choose all Shan Shan Shan does from Gs.
The Whistler Trumpeting Gee, the jolt hungry the true Union running it on time.
Design.
Well, Judy I'll put you on Zhengzhou launching on will be on the quell engine just short of the year, which isn't true Jim volume the.
For the economy to you George Holmes of Squali don't you decided on.
Julio Foo well engine just short of you excuse me in Bali.
The answer look also to draw the bullish on year with home here.
Sure well Michelle in the food channel changing Sanjida duly shirts, Ingo you don't peanut alcohol due the surgeon tangshan it because of your way line jumped ruble wipe alka of woman of the hurdle for that woman of UGG concert that drill for them in the shoulder people, but if I sort of mean tend to be on what.
The flu.
Chuckle out of your tranche of cleaning Georgetown Union Shanghai on assured in challenging June quarter.
The way the one shot.
G G toward a union for rule real Universal Hollywood on Shanghai on the shoulder moodle.
Well on funds like when they hook, what told you of your indium shouldn't Judy.
Kinda on Union for Jaguar, One channel RUSHA, Hangzhou and Suzhou.
People don't them the washout for illegal.
So all of our union, while Magellan going job triangles outside cool on the origin of the phasing to the unify.
So you don't want the Schindler, sometimes G D. The put on one going on for the Cotai on that.
On our Union Johan.
On top of head on the journal cycle of all your frequency the sometimes it's al.
Junior while majority of which on kind of homegrown cycle of Julio screening for flipped gay woman you on on the cohort of the hurdle of a whole bunch of force in the food you are well on the Hi, John total you bought on the phasing sheet you on your screen for torture woman junkies of trend choke on border from Chicago Shameful should it that's sort of the chi from China, while Magellan.
Bush of Chicago, one of the Union for the Shanghai Fuji the rule in the food and Dunlap, who are on hold true for all each on her shoulder.
Well on the challenging she can go channel Joe how much of a meaningful you anything going on waiting sheet on what you how long the lead you Humphrey downturn on wagering on calling on Guinness will hire the linear algebra.
Oh never gone quiet at the end of Pangaea for onshore the Congo gelatin moving shufu.
Chime in you're on one of the culture, whereas on the treaty the channel she said that you're on.
Thank you Mr Hu.
Now and plan to translate the Mr whose remarks into English.
Hello, everyone. Thank you for joining our earnings conference call today.
On the unusual year of twos on 'twenty, our management team and I appreciate the efforts and the support of our employees partners and investors.
Today, I would like to take this opportunity to tell more about the ehealth.
Since our founding many people have asked me about the vision of Hum.
Today, I would like to elaborate our mission vision and our strategies. So that you can understand the ehow better in my mind Ehow will become on air mobility service provider of the integrated door to door air transportation products for individuals Ehow.
E Com is a technological innovation driven air mobility service provider committed to lead the next generation of autonomous urban Air mobility. Our mission is to enable the safe autonomous and eco friendly and mobility services for everyone.
In the future, we will build the ihan into of Tesla in the air, allowing people to use <unk> air taxi services as easily as using Uber today and enjoy the convenience door to door Air transportation similarity on air Logistics of services will also provide the convenience for People's lives.
We have been executing our strategy based upon our unwavering mission and the vision as well as our long term view of the future of transportation industry and in depth understanding of Ehow has the first mover advantages.
We believe that with the rapid development of autonomous driving autonomous flying services will become the focus of the transport sector and of compel a price of the market.
In the long run the function of OEM manufacturers will be integrated and consolidated the buyer. The service providers. For example, we more in the neuro two innovative transport enterprises are redefining the transport sector by integrating software hardware and the services.
The <unk> am industry is promising which is expected to reach $1 five trillion U S. Autos bi tools on 40. According to the research report published by Morgan Stanley. We believe with our decades of where experience is in technology and the product innovation, we will continue to be a leader.
<unk> and take a significant the share of the market.
Are taken or not our technology accumulation and the product innovation in the past decade gives us full confidence and ability to achieve this goal.
Now I will tell you more about the development of the paths of Hum following three steps of the technological technologies rules and the services.
First of all in terms of the product of research and development. He has the vision for future Air mobility is based upon three original concepts first autonomous of flying second the full redundancy system and third cluster management, so far ear on one <unk> for an ear hung to one six.
Have completed the full redundancy designs of battery system speed control system power system Battery management system flight control system and navigation system.
Whenever any system sales the backup of system, we will take the effect and the the aircraft can continue to fly without the volume, which is totally different from the ordinary Jones.
We have carried out of the flight test for more than five years, including a number of extreme tests in flight test in harsh conditions, such as the full power maneuverability tests heavy snow and for test high attitude of the maneuverability test C side, the salt Hayes environment.
The tests man the typhoon tests.
The electromagnetic and the vibration tests et cetera here.
Here I would like to express my sincere gratitude to our partners, who have been with us along the way.
Thanks to the strong support we successfully completed the first is that of our vision in 2017 at the same time since our inception, we have been committed to building and optimizing our systems. We firmly believe at Ehealth avs are the pioneer.
Hearing new type of all of the transportation of <unk>.
<unk> are not developed exclusively for parents by the for everyone, who doesn't need to go through rigorous pyro the training and testing our avs.
<unk> and operating the buy a complete set of systems on.
<unk> flying is the soul of our products, we deeply understand the aircraft to count the fly around the without the rules, which will have an adverse impact on.
On the future air traffic system.
Therefore back in 2017, we established our own come out of the control centers for <unk>, which was also of the first of its kind of in the world.
Since then we have constantly optimized the classroom management taken on our energies will.
We believe that the cluster management is also an important the guarantee for future flight operations without the cluster management of the clock command of control Center.
<unk> era of vehicles will no longer be safe and reliable and will cause huge difficulty is to manage among aircrafts.
Most of our management technologies have laid a good foundation for the whole system of our unmanned.
<unk> and the arrived and incredibly valuable concept I E. The era of media performance services and the logistic support for unmanned aerial vehicles.
More importantly, he hung his of company in the global U M field that is the first to carry out of the U M flight tests and conducted the most of the tests while widely in this area.
Together with our partners we have of carried out of numerous test of flight in countries, such as the China, South Korea, and Netherlands, and the United States, Canada, UAE, Qatar etcetera.
Every time the offline vehicles take off it attracts companies attentions in the local area, giving people a glimpse of the ease of the transportation in the future.
In addition, as early as 2017.
Cooperated the width of CEC to jointly develop the standards for unmanned air traffic from the first of test of flight permits in 2018, two of the trial operation of approval of the <unk> 106 for Air rail logistics and two of the official acceptance of our application of the airworthiness certification for.
<unk> 106 passenger grade <unk> in the last year the.
<unk> had has been closely working with us along our growth.
Two days ago, we held the airworthiness certification meeting with the national export of the global from CEC, which means we have officially entered the certification stage. We are steadily moving forward to obtaining the airworthiness certificate of the 206.
This is the first this is the second the step for us to gradually complete our vision since 2018.
Most one set in the wake of his success in auto driving.
Tesla will stop selling cars in the start to provide the autonomous travel services.
Understood. The from the earliest the days of the best way for operating Autonomous Air mobility is to provide the autonomous air travel services and has slowed to realize the distribution today.
Today, we are opening of a new chapter and about to embark on a new journey of becoming the world's leading U M. The service provider.
This will be our most anticipated the service tab of <unk> vision.
In this fiscal year of the tooth on 'twenty.
The future transportation, we envision is getting closure and the <unk> has made numerous breakthroughs and achievements in many fronts, including the product systems on the production capacity based upon on the <unk> six passenger great Aes, we launched the ear on 2006 F and <unk> six <unk>.
Models to actively explore application scenarios for <unk> in the fields of Ara firefighting and large load the logistics transportation.
In terms of the development of the U M network, our year on 2006 passenger great Aes have ability to carry all the air transportation in the city due to its lightly and of flexibility.
In order to meet the needs of longer ranges. We are about to launch of new model <unk> 30, with a flight of the range of more than 300 kilometers supplement two of the entire <unk> network.
Combined with the existing $1 six <unk> 30 for field the interest CD traffic connection within the city clusters, making the future Uhm network of stronger and more complete.
On the product development of front I would like to share with you three breakthroughs.
First of all I'm very pleased to introduce for the first time the development of the progress of our UT are vt's service of a medium to longer range intelligent aircrafts.
As early as two years ago, we laid out the strategic development of the roadmap of the VT service of products in the order of the size of <unk> 10, 20, and the <unk>.
The key service is the hybrid the veto design that the configuration of both pure electric of multi rotor in the fixed the Wii.
<unk> is designed for carrying passengers EBT service between the choices of safety and the efficiency, we chose safety as our first the priority <unk>.
<unk> 30 of product have advanced of Ford action capability, which can ensure that each of the aircraft. The sales jewelry in flight it kind of quickly and automatically switch to vertical takeoff and landing zone, which can bring the passengers to of the ground the safely as soon as possible after are considered.
Ruble period of time of demonstration on exploration, we did not choose the future tilt rotor design no matter of multi rotor or Doj ultra cannot have a full redundancy capability in all fly the modes, while the hybrid the designed to ensure a complete the fly the redundancy capability in.
All fly the modes redundancy for safety must be the first priority for autonomous vehicles other.
Other designs like of the tilt rotor will definitely add the additional cash.
<unk> two of the operation system, leading to the increase of the failure rate in order to ensure a certain level of flight the efficiency for our hybrid design, we make of lightweight for the overall design of the aircraft and overall weight of the aircrafts within 700 kilograms sold at the <unk>.
Aircraft of not only has grew the backup of robustness, but also has a good of long range flight of capability. We noticed that some media previously reviewed that we are about to release of new product with a flying distance of 400 kilometers.
Believe it refers to our <unk> by the media picture is actually a picture of the transition product reached 25.
From for its patent application rather than the picture of the BD <unk>, we plan to perform trials flight of the <unk> already in the open areas in northwestern China in the near future. Please look to our official release of the <unk> in which the specific aircraft the shape design and the related.
The technical power meters will be published.
The <unk> 10.
The other true multipurpose small aircraft of the same type in our video service in the early stage <unk> participated in the flight of the verification of the.
The Vito flight systems and other work now it also formed.
Our mature product and the has entered the stage of small batch production is free time with payload is more than three hours and the flight speed is of between 30 to 120 cubic meter per hour.
In the future is the will undertake the flight relative the survey and the planning for <unk> 30 of fully autonomous of flight. It is the independent indispensable product in the future you am infrastructure planning process in the can also be used for UAV applications in our smart CD command the control centers.
Moreover, we will release, the <unk> six and our menu pilot the model of <unk> AAV <unk> 206, and is expected to obtain a special errors laser certificate in the experimental category from CEC in May of this year.
As a sports electric vehicle the <unk> six and is with <unk>.
Small <unk> control systems as the traditional helicopter bus simpler and a more reliable and it can switch to autopilot mode with one click for all around the safety of protection in 2019, we got the certificate of unmanned aircraft system UAS fence issue.
To us by the EAC on.
For the protection of our UAS fence monthly could take off of lending we will make the flight safer in.
In the future we plan to work with our partners to establish a fight the experience park with the UAS fence. So that everyone kind of realize their dream of enjoining. The found with the manual flight on the safety of protection.
In addition, we have made a significant the progress in the AAV logistic port that we collaborate with our partners in for Julien <unk> Province of China of flight Sharp servings of fixed wing AAV design. The for Air rail logistics have completed the large number of flight test of Theyre, Realizing a fleet of 40 odd.
<unk> fly the from take off to landing from a to B. Meanwhile, the hurdle AAV logistic port is expected to become the first unmanned airports with no operators in the whole system operation, except for the system maintenance personnel and all aircraft that will be operating.
It automatically by the command control system.
We have also made the remarkable progress in production and R&D.
Our new production facility useful will officially start of production in June this year the structure of the Ehow product is the mainly made of.
Composite materials and the production of its composed of the product is traditionally a manual process. We will continue to invest of using the facility in the next two years on the gradually upgrade to fully automated production line to further improve our product the quantity on the consistency.
We will expand our R&D base for intelligent aircrafts in our Guangzhou headquarters and believe now the more innovative products will be born here.
Future development the path.
We will achieve our strategic goals through the following four stages strategic of Paas first we will remain focused on R&D capabilities for our passenger grade and logistic products with the development of <unk> 106, servings of the short to medium in the range of flagship aircrafts and the <unk>.
Service of long range aircraft as the core.
And the service operation as the orientation, we will continue to strengthen our take on the technologies and increase the bar and the focus on improving product safety flight duration performance and passenger and the cargo capacity.
Second build us first class talent team as an operator.
According to the established strategic positioning as the urban Air mobility platform. Operator, we will gradually upgrade from a manufacturer to an operation service provider and recruit the top level of talents for transportation of operation.
We will concentrate our resources in our core business and gradually divest the air media Smart CD management, and other businesses, which are less relevant to our air mobility business. However, our efforts to upgrade to an operation service provider need the smooth transition.
<unk> period.
These businesses will be gradually outsourced to two of our partners in the future, but we expect the new material impact in the revenues of around 80 of the businesses.
Last we will continue to expand our trial of <unk> operational basis, and air mobility scenarios, such as tourism transportation logistics et cetera, and actively build a number of the trial operational base domestically and overseas to carry all of the operational services.
For the same time, we will continue to accelerate the completion of the compliance work such as air Worthless Certificate and transportation and certificate.
And towards on 'twenty, one we will focus more on the R&D of Evs for passengers and logistics.
As our new production facility continues to be completed and put into production, we expect of that intuit on 'twenty one.
We'll produce a large number of intelligent passenger logistic of aircrafts.
This year, we will gradually carryout air passenger and the logistics trial operation services. In addition to selling <unk> to our existing customers and partners. We will also use some avs for trial operation services at the same time, we will actively carryout trial operation.
Services more cities around the world on this basis, we will simultaneously disclosed a relevant the data of the operation services, such as order volume of operational services number of active users service mileage and the revenues et cetera, we are confident that <unk>.
He will become a leader in the U M industry with our dedication and outstanding execution capability.
We believe we will make an impact in the world and enable people to experience convenience and sales air mobility services in the near future net.
My colleagues will continue to provide more details.
<unk>.
Those were missed the whose remarks now let me elaborate on our strategy and plan.
Hello, This is out of our sheet.
Chief strategy officer of E Com based.
Based upon the board decisions at the consider the firms of long term strategic goal.
<unk> business model will experience a gradual transition in 2021 from a pure equipment. The sales model towards the operation platform model. This decision is a result of the boards of deep thoughts and discussions that the thoroughly consider the volume conditions first two.
Uhm platform operator is ultimately the goal of E com as a world leading U M firm, we are dedicated to providing comprehensive and the effective solutions to this end we have not only build the most advanced <unk> such as the <unk> six but also grasp.
The key relevant the technologies such as cloud for management, so that of we're able to operate the multiple remote avs simultaneously through our centralized the platform based upon pre determined and the fixed arounds.
This whole system enables a seamless integration of AAV manufacturing and operations laying a solid foundation for us to become a U M platform operator differ.
<unk> the from some peer companies our business does not only cover the designing and manufacturing of equipment.
<unk> alone, but also system why the solutions for real operations, including ROE. The planning standard setting 40 of five key communications et cetera.
We are building a large ecosystems for you of and which is the comparable with the existing systems for civil Aviation. Therefore, we have positioned ourselves as the uhm platform operator from the very beginning of our IPO. We believe this is our ultimate choice.
Second safety is our top priority.
As the delivery volumes of ear on 206 continues to increase it as responsibilities on the customer side to ensure operational safety for a highly innovative product as such with no precedent. It demands high level of of safety standards of for daily operations.
Therefore, we believe it is the critical for us to take of four and direct the control of the daily operations of ear on 2006 avs to ensure 100% safety.
Third the <unk>.
Timing for <unk> commercialization is opportune, we have conducted over 10000 the flights of the <unk> Evs in the past of three to four years and have accumulated the considerable amount of real data based upon the latest the results of the recent communications with the <unk>.
The easy with the significant progress in our workplace certification for <unk>, we are hopeful in achieving meaningful progresses into the on 'twenty one towards the final stages in certification.
This will open the door for further commercialization of Ihan to Asics that enables an upgrading of the version of.
Uhm operation.
Therefore, we should the mega sufficient the preparations for larger scale operation in future to support these important the strategic initiative and also for field some customer orders into the on 'twenty. One we are aiming to produce approximately 250 units of <unk> 106 in the year.
Which will be a new record the for the company once achieved.
Finally attractive outlook for you of an operations more importantly, we see a highly attractive outlook for an upgrading of the model of the <unk> operations based upon all of.
Our 40 autonomous vehicles.
The different from the conventional model as of the receivable or of general aviation.
Our model ensures the higher level of of safety service quality and the profitability by lower levels of for operational costs on financial analysis shows highly attractive investment of returns with the short payback periods of for our equipment versus the conventional receivable or general aviation.
Considering the benefits of the largest sharing platform build upon sales on the fees at the relatively lower cost, we expect a higher degree of equipment utilization and the return profiles.
In various of factors, we have plan of 100 Air mobility Road's initiative by selecting 100, the meaningful flight. The route for a trial of operations within China by accumulating more operating data and the experiences we will be more prepared to launch of <unk>.
Just scale commercialization activities. Meanwhile, we are planning to release operating data such as the flight routes fly the shortage on the passenger volumes etcetera as mentioned by Mr. Hu <unk>.
I'll now turn the call over to our CFO Mr of reach our Leo to provide the financial results for the fourth quarter and the full year of $2 plenty of.
Richard Please go ahead. Thank you.
Thank you Edward and Hello, everyone before I go into details. Please note that all numbers presented.
And for the fourth quarter of 2020, unless stated otherwise for percentage changes on a year over year basis, unless otherwise specified detail analysis as contained in our earnings press release, which is available on our IR website I am going to highlight some of the key points here.
In Q4, 2020 total revenues were $54 6 million on par with total revenue of $54 7 million in the same period of 2019 due to the resurgence of COVID-19 pandemic in the quarter. The total units of <unk> to <unk> <unk> for 22 units versus 2006 units in the same period.
2019, causing the revenue from Irma for these solutions to decrease 10% year over year. However, our revenues from <unk> media solution increased anatomy offsetting the decrease in the air mobility and driving up our total revenues in full year of 2020, our total revenues increased 47, 8%.
The year, reaching 180 meeting.
Were pleased to maintain a robust annual revenue growth despite the pandemic impacts globally.
Adjusted gross profit in Q4, excluding share based compensation expenses amounted to $34 8 million. This led to adjusted gross margin of 63, 8%, which was three one percentage points higher than that of last year and the highest quarterly adjusted gross margin in the company's history.
Adjusted gross profit for full year 2020 was $108 6 million up 51, 7% from $71 6 million in 2019.
Adjusted gross margin for the full year 2020 was 63% up one five percentage points from 58, 8% in 2019 and also the highest of any adjusted gross margin.
This reflected the competitive strengths of the company and increase was mainly due to a favorable revenue mix with the greater proportion of revenues from sales of higher margin models of the Hunter <unk>.
Adjusted operating expenses, excluding share based compensation expenses increased by 55% to $47 2 million and as the percentage of total revenues was 86, 5% as compared to 57, 3% in Q4 2019.
The main of increased expenditures in R&D of new models, including both passenger grade in non passenger EV models and related related the operating systems with the enhanced functionalities.
As the results our adjusted operating loss in Q4 was $10 6 million compared to eight of adjusted operating profit of $3 8 million in Q4 2019.
Adjusted operating loss as a percentage of total revenues was negative 19, 5% compared to adjusted operating margin of six 9% in Q4 2019.
With the adjusted operating loss in Q4, our adjusted net loss was $12 3 million compared with adjusted net income of $2 9 million in Q4 2019 for the full year of 2020 of our adjusted net loss was $37 2 million compared with adjusted net loss of 31 9 million into the.
The 19th.
Now, let's turn to the balance sheet and cash flow. We ended the quarter with 189 4 million of cash cash equivalents restricted cash and short term investments the accounts receivable balance of $179 4 million have been reduced to $103 1 million with subsea.
Quint collection of $76 3 million as of March 31, 2021, representing 42, 5% of the bulk balance have been collected together with the private investment of $40 million in late January It is expected that the company has adequate funding to support.
Operations in the next 12 to 24 months of list.
Now, let's turn to the business outlook, our business is experiencing a gradual transition into a more operating driven model.
Given our ultimate strategic goal is to build a U M platform offer of the company with you now is the right time to salary of this process for better commercialization, specifically, we are planning to launch a 100 air mobility growth initiative in China from 2021 and onward, we believe the time.
Is opportune.
On into the final stages of airports and the certification of our <unk> as the result, we expect annual revenues in 2021 to range between RMB $130 million and $180 million.
That concludes our prepared remarks, let's now open the call for questions. Operator. Please go ahead.
Thank you ladies and gentlemen, we will now begin the question and answer session.
If you wish you asked the question now please press star one on your telephone and wait for the named you know.
If you wish to withdraw your request please press the pound key.
Once again, ladies and gentlemen, if you wish you asked the question. Please press star one on your telephone keypad.
Yeah.
Our first question comes from Ken Zerbe from Morgan Stanley. Please go ahead.
Hi, Mr. Hu Asbury Richard Thanks for taking my questions.
I have two quick questions.
I'm sure like the management team.
The touch on the uptick for specific time.
And the according to the comprehensive unknowns, but the other tiers that we could see some progress interest of the regulatory practice.
And with credit card ratio of <unk> simplification team.
But again, how should that translate.
<unk> more than eight hours about timing of <unk>.
<unk> is that the the specials.
This certificate.
When the if.
If we can get that.
And.
With that how should we think about the potential order of ways.
Upon the attainment of the certificate.
My second question says about the competitive landscape because we saw several players are making or plan to make inroads into this market as well that.
Of that change the industry dynamics, meaning poorly and based.
On this handout true in collaboration with the copper the NDA at the moment.
Thanks.
Well thank.
Thank you Tim This is Eduardo let me take your questions.
So first question regarding the type of certificate progress so.
It was very great the progress we've made.
Two days ago, how is the special meeting.
As the delegates from CNBC Theres, a very high level of senior <unk>.
<unk> from all over the country and the representing different bureaus, though for the sale.
And during the meeting.
It is actually of the kickoff meeting and the.
The income.
Because of issues of highly recognized our progress and so the message of here is quite optimistic however, I cannot tell you the exact timing for.
When we can't get to the.
Simplification, but based upon our communications so far.
We are quite confident about this issue and the bulk of the potential orders you mentioned.
Thank you.
Yes, it's definitely of these we will break the last hurdle our loss of bottleneck from the regulation perspective, so ritual of late.
Very.
The code the.
Asia for our future commercialization of our products and so that is definitely today of very good.
The message.
And your second question regarding the competitive dynamics right. So we understand that nowadays, we see quite a number of companies.
Companies.
Who are making their own products and including some auto companies as well.
However, we are quite confident about our technology, which is for Amy.
The.
Yes.
Entry barrier from the technological perspective.
Because we are the relation earlier, we are not only of company who focus on the.
The signing and in manufacturing the vehicle itself.
For adding a whole system. We're building the platform that is a very key difference which has set us.
From all of the other peers and we believe that the Lisa will definitely give us a first mover advantage.
We are building.
On.
On a platform and the setting the standards and the right now working with the <unk>.
The delegates.
Another major task is to scrap of the standards for the certification and so we are working very closely.
CES of issues in setting the new standards and we are very proud of that and so.
That is also very.
The different stack.
The vendor.
The make us the very unique in this industry and share.
So we are quite confident about our technology about our system and the hour and a whole idea of.
Future Uhm.
Hope this the answers your question and if you have any part of the question. Please let me know thank you.
Yes, very clear thank you very much Edward.
Thank you. Our next question comes from Vincent Gilles.
And company. Please go ahead.
Yeah.
Thank you management for taking my question.
I have two.
Two questions and one follow up follow up question. My two question is on the order and the clients on the first question is on the order book commencement of going to more details on our existing order book and the split between orders that we have received the.
The basically the buying deposits versus the ones debt.
Just pure intentional contracts and then my second question on the client is that as we previously we have been working with some 200 sites. According to what I remember.
So are we expanding our true our client base ex the nimble to one six F are we expanding too.
The governments and the.
What kind of comp base looks like and my third question is for a follow up on the the timing of the.
Air wasn't as the Philips Kates.
Totally understand its hard to predict exact timing, but is there a very rough kind of protection, let's say mid year or by the year end for next year, what kind of.
Like the more like a rough timing that we can predict thank you.
Hi.
Thanks.
I will take the first touch on.
So.
Our.
Order backlog is.
It's on the revenue basis, so right now at this moment there of roughly around 100 units.
And in terms of our from international versus domestic.
For the on the majority of all of this from within China.
That's the magic.
Given the.
Still ongoing.
Global pandemic impact and on.
40.
40%, we said the project will prepayments.
Yes.
Our cash.
Your second question about <unk>.
<unk> App right. So this is.
Especially designed.
On the AAV for of firefighting purpose.
Well the only in the in the process.
Painting, the lost the certification from the government and the Dora two items, which we need to do.
By conducting some experiments.
True proof the.
Capability and also obtaining.
Final.
Certification from the government.
The the client base.
Gradually.
We generate the cash.
Government of the firefighting department and the.
The emergency department from different.
Provincial government and the so far we received.
The very positive feedback from from the government. However, we still need to go through.
On the certification and so we are able to enter the national per.
As the catalog so that sort of the government of the complex order for that in and regardless of your last question for about the timing of the type certificate.
Of that.
No.
As I mentioned that we cannot predict the exact timing, but based upon the <unk>.
The message from the government of ratios.
It is a quite optimistic of what you say.
Hey.
And also the whole process should be gradual process, which means that.
Towards the final certification so could be some several milestones during the whole process, which we expect to achieve and to get the recognized and so I think.
During which we should be able to share the news with the market in the <unk>.
Next six to 12 months.
And about the the progress in the show.
So that is why we can say now thank you.
Yes.
Thank you.
Alright. Thank you we are approaching the end of the conference. If you have further questions. Please contact us by email or phone. After the conference call. Let me turn the call back to Mr. Liu for closing remarks.
Thank you operator, and thank you all for participating on today's call and for all your support.
Appreciate your interest and look forward to reporting to you again next quarter on our progress.
Great. Thank you. This concludes today's conference call. Thank you for participating you may all disconnect.
[music].
Okay.
Yes.
[music] line.