Q4 2020 36kr Holdings Inc Earnings Call

[music].

Hello, ladies and gentlemen, thank for standing by for <unk>. So it is ex KR holdings incorporated fourth quarter and fiscal year of 2020 earnings conference call. At this time, all participants are in listen only mode.

Management's prepared remarks, there'll be a question and answer session. Today's conference call is being recorded.

I'll now turn the call over to your host you'll enter the U I our management of the company. Please go ahead your dander.

Thank you very much Hello, everyone and welcome to Thursday, KR holdings fourth quarter, and the physical year 'twenty 'twenty earnings conference call. The company's financial and operational results were released earlier today and have been made available online you can also view the earnings press release.

By visiting the IR section of our website at IR Dot Thursday, Fs KR Dot com.

Participants on today's call will include our co chairman and CEO, Mr. Doug on phone and our acting CFO Mr. Shan Li Mr.

Mr phone well start the call by providing an overview of the company and performance highlights of the cart in Chinese followed by English integration. Mr. Lee will then provide details on the company's financial results before opening the call for your questions before.

Before we continue please note that today's discussion will contain forward looking statements made under the safe Harbor provisions of the U S. Private Securities Litigation Reform Act of 1995.

We're looking statements involve inherent risks and uncertainties as such the company's results.

May be materially different from the views expressed a day holding information regarding these and other risks and uncertainties is included in the company's prospectus and other public filings as filed with the U S. S E C.

The company does not assume any obligation to update any forward looking statements, except as required under applicable law.

Please know that Thursday, Kr's earnings press release, and this conference call include discussions of audited GAAP financial measures as well as unaudited non-GAAP financial measures.

Six KR is press release contains reconciliation of the unaudited non-GAAP measures to the audited GAAP measures.

And please note that all amounts numbers are in RMB.

I will now turn the call over to our co chairman and CEO Mr phone Paul. Please go ahead.

Yeah.

Okay.

How do you I guess have you done.

I know you probably don't we.

Thank you and Hello, everyone. Thank you for joining us today.

Cause you to sell them convenient.

Just your standard Okay, that's all from Europe.

The share repurchase.

Got it.

Sure.

So with all share if we don't see how even when it's all your line.

Anything like that.

Okay.

The two that opportunity too.

Okay.

Cause intelligence being price, we're seeing larger shopping on line, which aren't you.

You can do qualitative guidance you called that as you go from here.

And then Joel.

Sure Sheila.

So you guys have with almost family for home Tonight you.

Going back to our argument.

Before we begin I would like to extend my sincere gratitude to all of our stakeholders for your continued support over the past year.

'twenty 'twenty was an extremely unusual year for the whole world and also for all of our business.

As with many companies, we encountered a borrowing degrees of challenges and nickel.

Gnomic uncertainties stemming from the widespread impact of the COVID-19 pandemic.

Thanks to proactive responses from other supporters and exceptional employees on zero timely adaptational to changing market dynamics.

At least we have weathered the storm.

Having similar fully overcome this short term obstacles other fundamentals are evolving to be stronger and we are entering 2021 from a position of strength as we return to more normal business activities.

Yeah.

So again, because it's a hollow share from the Huntington.

So to the other day time.

Okay.

And he said he would hope actually that kind of thing that did answer at all.

Sure Jonathan.

So we haven't had as much at all day long.

No.

Good morning.

So these are single told me this is about.

Having said all of that initiative.

So you don't need it I can't be altered element that you see.

So again, a few days from now.

No.

P. J if I heard you say that your Geneva people don't put out that you're moving more to them.

Sales have United.

Yeah I'll go ahead, and he didn't come back from Honeywell Tel.

Tel Aviv.

Peter I think you said.

If you don't do it I'm going to let them go.

It seems like in Holland.

Uh huh.

First of all we are proud to have concluded 2020 with strong traffic momentum in the fourth quarter across all of our core platforms and the major third party platforms.

Thanks to consistent delivery of high quality content and diverse distribution channels. Our total average monthly page views reached a new record high of $632 million for the full year 2020, increasing 48, 1% from the prior year.

And 11, 3% sequentially.

Stellar performance marks our 11th consecutive quarter of PD growth and further validates that our ever growing and engaging P. D C and UDC content.

Are resonating well with our expanding audience.

In addition to upgrading our own platforms to effectively improve the rating and the viewing experience all of our users are very efficient use of a third party traffic platforms, such as the unbelievably simultaneously depends although it doesn't have smoke by driving additional healthy traffic growth.

But is there any older and non lease actually diesel she'd only agitation there when they sometimes they finally channel.

Hi, Tony.

He's until it's adding hot Amy and John you just all she didn't bother until Joe how are you doing in tune down a lot I am sure you total non goes down when they went from time.

Oh, that's right now if you don't know come from.

With all due partly in line you'll.

The decision they want to.

They also do the onetime elements as you're bound to see now how many would.

Would you say net Colorado Tau sometime ago.

Please go.

From here in Nashville, Tennessee.

Well, then say what can you say they all day.

So I'm wondering when that I've alluded to.

You can.

See that I've missed thereby trying to go about video share, which I'll just say as usual.

Many of them in the queue.

How should we see them, especially if it was somehow.

Average content creation and production capabilities have gained momentum.

Our UGC production and distribution capabilities as well as other amortization abilities for the 2020 full year, we produced 108000 pieces of content and increase of 16% year over year.

Besides our superior quality content creation and production. We have also strategically created compelling library of insightful user generated content leveraging of her in depth data insights into user demographics, we proactively help institutional.

D C creators determined appropriate topics around which they can create a compelling content in the fourth quarter. Our U D. C offerings accounted for 67% above our total content offerings up from 48% in the prior year period and 68%.

<unk> in the prior quarter the increase indicate that we are well on track to strength in our content platform capabilities.

Thank you and you'll forget all of them all kind of going through from here.

Yes sure.

Now could be hit the hardest channel.

Has your cultural hopping to utilization on how are you doing actual Santa Clara continues.

Gotcha.

Certainly it's within the day long ago, when we were doing that from what we're going through some.

Sometimes it doesn't have to hold it as a piece of it in 'twenty one.

So I'm going to just you're saying with this issue.

I mean day, including Crystal.

So honestly I don't have one for finish line.

Any thoughts about your bill.

Even though China from Sidoti.

So it'll take them to a degree that syndrome.

Okay.

Concluding on leap campus in the fourth quarter in Oklahoma.

Insightful business with search spanning a broader range of companies and industries continues to gain popularity and virus markets.

In particular it is widely praised among security market participants to some other information is invaluable leveraging our new economy community centric resource networks, we are spearheading the transformation of timely and in depth analysis of public companies.

By covering their pre and post IPO see this for instance, we publish exclusive and thoughtful business overviews on an army of newly listed Chinese companies, such as rack technology and price show from inception to their ipos. The deeper we go into <unk>.

Our research expertise and experience the more we are able to extend our services across a wide spectrum of industries.

Should you have any on Telemundo out when they want to know who's on the call.

If you do them at the same time out in the Ocean.

Well then that price was around the shifting channel 10 dollar to dollar.

That is what you do from a kind of sitting.

I can't do the thing that I can give you an answer to nail Polish.

Global shipping channel.

Let's see.

So if you don't want me to talk about it was one of them.

I don't think you should have to moving that goes I'll put.

Put all of them.

Certainly from the.

It's all one time items, you've had nothing to that having said all opinion consensus your.

Torturous until blown out and told him on a bunch of you today are the people moving and have what are called it was hanging too because it wasn't all children and looking good.

Lee you talked to him and said all the time of day, you'll Italia two zone.

The information we can cure it.

Available in a variety of digital forms clearer trends in video how quickly emerge as a top choice with all of our considerable capability in this arena the rapidly growing BDO market presents a huge growth opportunity for us and we significantly increased our engagement.

Across our broad demographic in the fourth quarter average.

Self produced video content has spurred us to become one of the most sought after organization accounts on a leading video per that the platforms such as availability. We are way host more than 600000 followers. In addition to globally. We continue to work with other highly trafficked platforms too.

Enhance other monetization channel.

Our KR finance accounts has more than $3 6 million followers and we are ranked among the top 30 video creators in the finance segment. We have also distribute it monopole trendsetting short form videos on volume each spanning over $10 million play back the high.

<unk> engagement level and the rapid growth. We are hearing on these influential social platforms are excellent barrow meters of our success and successfully activating our growth strategy with Cumulus abating content.

So there should be 100, almost without their own core correct.

People will say Oh Wow titanium.

Well anyway, excuse me and from the whole bank.

So.

As the video content continues to be heavily sought after by incubated users companies from virus industries and government, we have father's day paying all of our strategic cooperation with prestigious partners on the content production side, both domestically and overseas and including our strategic share.

Holders.

The rule you can enjoy with only yokoyama whenever one of your debt tender a hotel.

I saw you who does that cause you to maybe it goes all back to New York with alcohol.

Is there a way to achieve the easier could you put them on weight.

Okay.

From there you can kind of Fisher channel.

It seems you're basically taking on line kind of a community.

He's going to have any population share San Antonio channel could you be life.

Well the hydronic also interest will come from China.

Sure the needle the intangible I haven't seen from higher working with you.

Following last septembers announcement of our strategic collaboration with <unk> in December 2020, we became the exclusive tech media partner for Youku first production of the Tac hawkish.

New year's Eve gala future imagination technology building, our numbers its industry, leading content and resource capabilities. We featured our insights into futuristic technology trends under the impact of debt.

As well as helped screen and identify new economy companies, who showcased innovative products and future technology. Other events going forward, we plan to co produce more high quality content covering a wide spectrum of business topics and explore.

The possibility of multi channel network MCM business.

Well I mean as you know have all day.

Shifting now.

Oh man.

So let me take on what you know you've had a bunch of little means looking at Joseph a little hard to accumulate a consortium you can teach you don't you don't hear a lot more obviously, there's and whats your total hotel channel.

Okay I got you.

And I hope you find your you're doing well.

Yohji name because the culture Colgate anyone's gonna have been pulled I imagine it's in the channel.

This.

This March we entered into a strategic partnership on business centric video content production and new economy focused services with China's major media outlet format with a share dimension to embrace the involving new economy environment across multiple Chinese consumer brands.

Are adopting digital transformation, we kicked off the program production on the sponsorship a.

Promotion for our first joined proprietary program the great Chinese companies as part of the partnership. We also have future plans to work together to discover and retain talented talented content creators.

Business wise content that fosters a vibrant content ecosystem and at this time to explore.

Our monetization opportunities.

Oh man.

And again that does this channel.

I will then turn that has transitioned from to your condo teaching people how that channel.

T infusion.

Pleasure to get even with your wholesale channel retail no generics.

People don't you'll have a good evening.

How should we be illegal.

Teach them for Sundar change, Illinois.

Turning to our monetization efforts in the light of the intricate margin environment. During 2020, we were responsive to seek opportunities to transform upper corner businesses into a more concert political on the scalable model at the same time, we have been actively work.

King on tapping into emerging markets mined in the aftermath of the pandemic by leveraging our premium content and capability and causes consistently optimizing technology and data insights across segments with increased our ability to capture new opportunities.

She is underperforming from a yard and in charter type of loans. You found out did you you can either handle that sounds like.

EBIT, we leave it with you.

Yeah, Hi.

Higher duties.

Got it.

They cannot have any idea what your goals I'm sure you can comfortably sheet day, but he said he had a wholly owned on top of line there are run in Guangdong.

12 in sales what do you sell homes.

Your line, so ninja ease up on how you book well.

So it's only the hurdle the bar high income we didn't do them Theres nothing here. She cannot he does oil position Shouldnt put antidumping passenger door quite a high degree of caution here.

Hi, Matt.

From what you would have on share repurchases I mean, you have Andrew.

In terms of our value added enterprise services.

Segment, we successfully hosted upper highly influential new economy annual summit in Beijing from December 2020, including both offline and online activities otherwise 'twenty 'twenty event with the theme of Rice and return featured a broader spectrum of industry wide.

And the keynote speakers attend.

Attendance at ever offline venues and the live streaming sessions were better than expected.

Over the course of the three day event more than 22000 visitors joined us on site and ever live streaming sessions are attracted 319 million visitors across our core and third party platforms.

Broad reach of these prestigious events not only had a positive impact from Melbourne.

Non hydration, but highlights our ability to continually enhance our brand recognition and to expand our consumer customer base not just domestically, but also abroad as a number of overseas new.

Economy participants access our live broadcasting sessions.

Suitable and anyhow, although income.

Well I don't know would equal again put on a day on why those interest you in Lehigh.

Hi, any of that she is Oh, what I tell me always tell the Xinjiang chassis piece of the Cheyenne Engineering HEICO holiday you know very high endogenous trinity's wholly attributable enrollment film that anything from Washington that go through.

Hello.

Please let him bundles I know how you can go into cohort pencil, if I just kind of trying to.

You combined with how much you can do with how long ago, but getting calls all day.

Yeah, that's close to my viewpoint.

As normalcy returns to most of the countries offline activities, we remain committed to cultivating diverse learning communities for different industries and sectors by connecting entrepreneurs and executives in the same industry. They can more effectively share and learn best practices to better.

Tackle shared industry challenges.

These initiatives are also designed to help us generate leads for our subscription services. For example, our exclusive seminar on strategy don't quit and the industry interview fibrosis KR hung up with cooking have helped clients in both traditional industries and new economy sector.

<unk> to explore and discover new opportunities in areas, we were not previously familiar with.

While achieving efficient customer acquisition and the building collaborative business connections to access more resources and growth opportunities.

Can you just really don't have to share. How you also thought I heard you obviously don't have.

Because it has sort of shouldn't anyway.

Right.

Did you say you will be able to talk.

Well if I can just ask yourself, what would you define title unless anyone else you can share because all it's usually the bank with citizens.

So you'll have to hold down the Tvs I'm sure there's something wrong.

So don't worry about it.

Once again, he doesn't want it cannot looking once the COVID-19 to.

Two of them, they're not shopping with you said that haven't been put on it.

TV, that's what's behind your sales behind Sutro at the home in China, and I shouldn't even ones that day the terminal four the tangible quota.

When you think you can do it too many.

Pencil.

Given the ubiquitous the formats and the massive margin in China, We began actively exploring commercialization opportunities in video content. This is a natural evolution of average capabilities and in the fourth quarter more than 30% of our service.

Lucian adopted the video formats and have received positive feedback as video content and followers rapidly grow across our core and third party platforms more traditional brands increasingly want to work with us to capitalize on these translating market strategy. For example, we originally.

Sign a contract with one of China's leading direct competition to create a digital our digital marketing plans by our self produced meetings to make kids yogurt products resonate with young consumers as we further expand.

The diversified product and service offerings, including our robust video content, we will continue to explore strategic collaborations with more prestige <unk> Congress.

<unk>.

David I think that goes from here.

When we've gone from what we all have that channel.

Continental till you thought analytical community. She came to mention to you. So you don't have any of them from doing it you always hit on fibre channel.

This Tuesday, we just announced a strategic cooperation with Chinese State media Cctv's program, the growing up the great brand supported by multiple online and offline activities. We will use our diverse services and a strong resource networks to help a large number of Chinese new economy.

Enterprises to enhance their brands and propel more coordinated business development along your supply chain.

So I think it will come in.

Dominion patrolled I said he was going to be though so if you do hurts you wouldn't be what it was I didn't see from growth to trend here that <unk> growth.

Okay.

Total residential loans, where the ta.

For the human beings out one of my phone tablet share CF politically channel because you.

Hum.

Okay.

Yeah that hadn't been <unk> T shirts, Angela limitation will change from that she's route of your automobile shifting how you're going to alternate won't see it on the documents as you want to just annual quotations here hold on quota share.

Can you just I know who are telling me that you can go to.

As soon as you test those as well.

Or have you kind of what <unk> done that on all items.

You can be 90 day kidney.

Kidney Chico's ICF will give you from me and the changes.

In terms of subscription services.

Fourth quarter, we launched a new and upgraded version of ever Enterprise Service review website damping Dot Thursdays KR dot com in order to view China's most professional platform for enterprise level application and services selection.

This comprehensive new offering enables.

Potential buyers to view the information GAAP by providing the rankings and feedback for application and services from real user on the platform.

Enterprise service providers can simultaneously upgrade your products to spur a cyclically at Wassa dynamics feedback of users as well as capture potential customer needs and sales leads.

Our goal with this innovative service is to form a V.

Virtual business cycle, driven by powerful content offerings. This is a natural per session and extension of our own enterprise service.

Carol.

Well also potentially helping us involved into a more scalable.

Subscription model with higher customer thickness, we plan to utilize our large scale enterprise now worried community to boost traffic for our new platform.

Moving and Enterprise services Alliance community focus on number of Enterprise services review business.

So this needle moving.

We're telling you that order flow. So we don't see as you go to the Healy pathology with hotel deal are they arent, even Charlotte Wilmington share. It's obvious you don't flow to handle coupon a Hong Kong because you've only because you can see it as one of the highest.

Rajiv I type items.

George I wish it from you probably just want to tell you.

Put all of the amount of.

Tablet on these shoes, you're finally here you cannot sell more choice.

Choice I wonder if someone were to again, the kind of deals that you're doing.

Well I'll say it that way.

As you saw putting interest if you Goldman Sachs, because they'll choose a imagining into our assortment Kahala channel.

I know you've had it go how do you.

To do that here.

Our innovative and creative services getting further attract.

Traction with new government collaborations during the fourth quarter. For example in December 2020, we supported our local municipality to host and air and Aerospace information from eight in Hangzhou, a significant local industry seminar. We also aided local governments in planning.

And developing smart cities concept without a serious of entrepreneurial contest focused on smart city projects across different regions in partnership with local governments, our strategic focus on governmental collaborations not only raises awareness of our brand but also play.

With us as a from a forefront of our compute opportunities in cross regional economic growth within the new economy space.

So Sean maybe point out that not only hurting yeah, because if they don't have the Shanghai and Jim will then share with you don't.

Sure momentum.

How do you see them put them behind us.

Tom do you want to industry standard.

Can you give initial when we guarantee you we'll put a phone call from the time you hopefully we'll touch on it can you give any sort of in line with Dan Shaw, who doesn't put all the usual put on board as a class two.

Rhodium, so they come with new eating shortages and they only 14 per when we don't really per se, but that's another shandong cohorts amount of view people don't add items, you've got Ya.

In summary this.

The challenging 2020, and the fast evolving market dynamics, we continue to build our.

Build out our core strength at the same time, we demonstrated our ability to swiftly adjusted upper cooperations.

And operations to align with the changing market and reach our sustainable growth goes over the long term with a pandemic largely behind US we will work to strategically.

Product and service offerings.

Hands on networks.

Increase our user base and diversify our growth avenues to strengthen our monetization capabilities.

As the go to content and service platform from China's new economy space, we retained committed to capturing additional opportunities in the growing markets and delivering long term value to our shareholders.

With that I will now turn the call over to our acting CFO, Mr. Shan, Li who will discuss our key financial results. Please go ahead Neil.

Thank you Yolanda, Thank you Paul Hello, everyone.

Upholding hedges from lingering.

Pipes are full.

The COVID-19 pandemic extended into or force culture pulp high performance.

Over revenue from or a line of the.

The replacement services and subscription services deliver are crucial to our.

Growth.

Which we see.

<unk> also a gradual demand.

However, given the challenging environment and the license they learn we havent been activity of job growth or business operations in order to achieve long lasting deficiencies multiple day or gross margin increased by 400 basis points too.

42 per cent in the fourth quarter of 2020 from the third quarter.

They also realize the full day key operating cash flow for the FERC continuing culture.

Some of them.

Suddenly falling the resilience.

A DVT or business model.

Internally, we continue to see or to see quarter over quarter improvements or accounts receivable. After we made or prepayment policy adjustment on the Python requirement for the tree sales.

<unk> also a quality clause.

I believe you have or course true luxury leading content production capability and the book or the Poland or monetization channel basically they are well positioned to serve new economy, particularly post on the girl alongside.

With the.

Now I will go through more detail, all or fourth quarter of 2020 financial results.

Our total revenue were $121 million in the fourth quarter as well for 2020 compared to 300 from history millions in the same period also 2019, although other word pricing services revenue decreased by 54% to 69 million.

In the fourth quarter. It's also 2020 from 150 150 minutes and the thing to at all from 2019. The decrease was mainly caused by the big demand from certain advertiser and the assumption of a trick for variety of policy.

For customer selection.

Surprised about it as your services revenue were $41 million in the fourth quarter of 2020 compared to 140 <unk> hundred 50 Board meeting since I've been here at all from 2019.

Decrease was mainly caused by the inquiries.

Revenue from.

Integrity marketing services.

Our strategy.

Continued decrease includes certain venues.

Subscription services revenue was $11 million in the fourth quarter of 2020 compared to $18 million in the same period off the 2019. The decrease were mainly caused by the decreased revenue from in the vertical subscription of some.

Some of the off line training courses were cancelled due to collectively impact from COVID-19.

Cost of revenue were $71 million in the fourth quarter of 2020, compared with 266 meeting in the same period at all for 2019. The decrease was mainly caused by the decreased revenue gross profit.

51 million in the fourth quarter of 2020 compared to $156 million in the same period of 2019.

Yes.

Operating process, where a hunger from two 7 million is in the fourth quarter of 2020 compared to a hunker and <unk> 7 million in the same period of last year.

The decrease was mainly due to the increase in G&A as opposed to in the fourth quarter of 2020.

Sales monkey pause. This work 35 millions of fourth quarter of 2020 compared to 15 million in the same period of the 22019. The decrease was mainly caused by the decrease in payroll related expenses on the share based compensation.

Perfect.

Our agenda.

A J on the aging process for 82 million in the fourth quarter of 'twenty 'twenty compared to $47 million in the same period of 2019.

No.

The increase was mainly caused by the increase in.

Allow reversal for thoughtful accounts, partially offset by the decrease in the share based compensation proposals.

RMB pause this decreased by 12% to $9 million in the fourth quarter of 2020 compared to 10 million in the same period from 2019. The decrease was mainly caused by the decrease in share based compensation expenses.

Share based compensation expenses recognized in cost of revenue.

Sales marketing RMB passes and the general of NIM, because if youll total.

In total we're line median in the fourth quarter of 2020.

The.

<unk> seeks the meeting and the things he rode off of 'twenty Nike.

There is places where per minute in the fourth quarter of 2020, which includes a loss of <unk>.

Well 16 million from equity method the life's moments.

Income of $5 million from government grants.

Compared to others income.

Two men is in the same period.

2019.

Tom types of deposits were $4 million in the fourth quarter of 2020 compared to $20 million in the same period also 2019.

The increase was mainly caused by the increase in the allowance for deferred tax assets net loss was $19 million in the fourth quarter of 2020 compared to income of 32 million in the same period of 2019.

Note that the adjusted net loss was $81 million in the fourth quarter operating expenses compared to income of $58 million in the same period of 2019 net.

Net loss attributable to 36, KR Holdings, Inc. Ordinary shareholders was $91 million in the fourth quarter of 2020 compared to income of 99 million in the same period of 2019 mentioned increase.

Occur accretion.

I'll return within book Bowl.

Non core holdings interest.

Ah Ah creation on the racy violation effect of convertible redeemable preferred share.

Basic and diluted net loss per share was Bob.

Zero point their line in the fourth quarter after 2020 compared to the based on the diluted.

Net loss per share of.

0.1 on the 0.03 in the same period of 2019.

As of December 31, 20.

'twenty 'twenty.

The company had cash and cash equivalent restricted cash and short term investments also.

200, and the $9 million compared to 264 million.

But at.

At the same time in the last year.

To be mindful of the loans off our earnings call for the first full year of 2020 financial result, I really encourage listeners to refer to our earning price release for further details.

This concludes this concludes all of our prepared remarks today, we will now open the call to questions.

Operator, Please go ahead.

Thank you.

Later to ask a question press star one on your telephone to withdraw.

Your question press the pound of cash P. M. Please standby, while we compile the Q&A roster.

Once again for your questions. Please press star one and for the benefit of all participants on today's call. If you wish to ask questions to management in Chinese piece immediately repeat your question in English.

Your question. Please press star one.

On the phones.

Yeah.

Yeah.

Our first question comes from the line of.

I D G of credit Suisse Your line.

Please go ahead.

Yeah.

Well Oh Wow.

Oh, My Gosh, you do J codes alone.

And that kind of home Oh, Gee, Oh excuse me.

Yeah and myself.

Any management. Thanks for taking my question I just have a pick one.

Just wanted to ask I'll add demand by vertical how does it trend in the fourth quarter. Thank you.

Yeah.

Thanks for calling that day that cohort.

Either.

Finally, although in share, especially because I know that doesn't go away.

Okay, Okay, well equivalent per phone without financial loss from these do not assure you Joseph.

So we'll just have an annualized.

T D.

Toward that end up below the highest.

Here's what the tangible reason honest with you.

So he was on it anyway.

He didn't get a cohort data presented at analyst day, you can see here you can hold you here's what I'll say non accommodation to agricultural book.

It's a handful of COVID-19 here towards the back.

Understood.

Yeah, I'll answer that one for book and Here's what I'll tell you kind of lost you Joe Thome from Black Hawk cleaning alcohol channel without how he is gonna be a share Salvation Hall.

<unk> yeah.

Towards the dry ice.

Now I will tell you hired about how those long negotiated with Ono. So your woman.

So there's a little Ohio, Xiaomi you kill them.

Just as you wouldn't you couldn't.

Because I'm sure you do.

The car companies are not running at horizontal.

Okay. Thank you for your question Avi.

I think.

Directly on the customer at the mine site over a multinational customers have been affected the most.

Moving to delayed budgets for advertising.

Ever since the Q3 advertising needs from some customers began to recover like what we're seeing in.

Automobile and the three seats at the same time, a quite a few Chinese consumer brands, which are which we actively reached out in the second half of 2020 show their growing demand for our platform.

And another characteristic.

Our new economy customers they show their resilience during and post the COVID-19, and their own businesses kept growing.

And this contributed to the increases in the number of customers and our average customer price in this year, especially when it comes to those TMT Giants and Super Unicorns.

We can share some more color on the industry distribution. The top five are in 2020, our consumer Entertainment Enterprise services free C and E Commerce, Besides where we also saw strong demand growth for our advertising Edward.

<unk> services in the AI and the online education industry, so to sum up a week, we can see that we are.

Chief.

Nearly 36 percentage.

Sequential just to correct the mistake.

And if.

If we see and in the last quarter. We can see this sequential growth have already achieved as 63 per cent present in the Q2 free. So we can see these AR consecutive a recovery from other advertisement segment.

I think this is for your question. Thanks.

Yeah.

Yeah.

Okay.

Thank you.

Thank you.

Our next question is from the line of.

E of Needham and company. Your line is open. Please go ahead.

This is as.

The whole reason that once your EBIT neutral going to argue that you don't want to ship will make sure that your distributable cash.

Yes.

Intuitively do.

Due to the differences from the Gambro, which you should screens woman sequel, <unk> cell growth.

The whole Jay good to go.

Thank you chip.

I wish I could look at Nordea, Inc. Susan Jordan.

Sure Sheila.

Sure Jack Ocean County in the country. The Shinbu some time on our financial income.

The measures we're taking my question. The first question is about <unk>.

When you want.

Luke can management share some.

Insights on the fiscal year, 'twenty, one outlook and where do we see the most potential.

In terms of revenue growth and where are we investing the most the second question is can management share some insights from the shift in revenue mix in the fourth quarter.

Well.

<unk>, so what drove the ships.

Moving to be the new normal going forward. Thank you.

As I sit here at Ensign.

Well, our day Nando Nigel sure Vantiv in almost any sort of balance sheet accounts out anything yet.

So you know you can do that.

Your line.

And <unk>.

Gentlemen.

It just won't go down sales, although I can tell.

Got it.

My daughter, she that's hardly at all.

Wish you can clearly the union quite be adding it all from the Union.

Other non when do you want to understand Glenda non tissue.

With us on accounts with you whether it's one two times.

Sure.

Sure.

Josh Nichols and sometimes you'll have seen the cohort interest at times to officially open day, you've got to not only and there was some time ago.

In Ohio, which is a typically in children.

Hi, Michelle.

And Nashville.

Until the year most of that debt. So you already argument when debt was all kind of hold on to the BD.

Well the whole hospitals at the time be away from go, especially without you tell me. The total day trying to quota share shifted rather either so how's that Canadian any day, we have Ohio.

Have you already are and you know which is reported on that so it sounds like.

I was really young toilet volume you can live with a tissue.

Thank you Joe.

Hindrance to our sales you've already kind of weighted.

It's just that tissue.

It was how much is auto ru.

Oh. This is what we I think we are attempting to guidance.

I mean, the two tools.

Tom I think he also especially the way I have oh, yeah, well top quality for total norcal I figured out I think you guys reiterated all of them are in yen.

So again it kind of a.

<unk> also the Ddos.

So that I can do share, Oklahoma, It was something that I kind of off price.

I'm just curious within cheap.

To go one day or even in Korea that your holdings in doing that which I think went into as well as income.

So you always you know kind of what you.

If we were telling you.

You can go down there you go you can look at when he says Oh man.

I think that you could use those words.

Thank you Bill takes another day studio will then.

So all else equal for Tmall either top line.

T J F.

So from both of them.

I'll come to your gross margin Museum condos.

Good day, and Humana building the hotel won't connect.

There was all of them, but it will change in that if we get new opportunities down there.

Gotcha.

Moving to I don't play element. So if you do that it was sort of grew more than marita, just antigen could even say.

Because you can see that Huntington knowhow to Huntsville.

Hey, listen.

Thank you so much Vincent for just two questions and I think these two questions are well linked.

For your first question to comment on our outlook for this.

This year I think like a floor for us and for most of the companies in.

In China and globally.

20 must be very challenging year and jobs.

You know from the macroeconomic level and for the fast evolving market dynamics. So we are.

This situation May does two things about our business from a longer perspective and out of.

But also in the short term, we also proactively made multiple adjustments in.

In our operations in a short and.

Medium term, maybe we will remain focused on our video oriented strategy and to explore opportunities in broader address a market for it for ourselves I mean for the private and.

Public markets.

Markets and a second.

You can see.

We are already explained if we're a longer longer term, we will involve all of our business model into a more scalable and a counter political we expected.

Maybe are there, Chris and never enterprise value added services this year, but we believe.

Dreamily important for our longer term development and.

For index.

This year of our advertising sites, we expect that continue recovery.

And this year just like we performed last Q3 end of Q4 and at offline.

Activity restrictions, our total and looked at I believe our offline businesses well continue to restore and be strengthened.

On the investment side, we will keep investing in our technical and data capabilities.

So as to facilitate the evolution and upgrading for forever current enterprise value added services and the upper subscription products as well as to innovate other new products.

So to sum up.

We will see the main driver will still be our enterprise to be asked.

And for the for the second question as you noticed that.

There is a little bit.

Structure changing for forever fourth quarter, but actually all from the from the whole year's scope.

The enterprise V S, where still the top contribution to our total revenue.

Around 50% and a.

Compared to the advertisement accounts for 40, 44.7% as I just shared.

Or is the idea that the.

The structural change brought by the pandemic impact will mainly line a number of enterprise value added services. So we Memphis.

Prudence adjustments and.

Involved and into a more scalable and a contract political model for upper enterprise value added services.

Over the last two quarters in 2020 and.

At the same time, we cut down some low margin.

Marketing business, which is accounted for the most in our and enterprise value added service segment.

And so that's you can see that's why the revenue of the enterprise value added services in Q4 at the price. However, we believe it's also a broth already a higher GP margin and there continues.

Continue the improvement in operating cash flow for us. So are these are for your two questions and I. Thank you for your question Vince.

Yeah.

Thank you.

Thank you.

Our next question is from the line of Shanghai L. A C. ICC. Your line is open. Please go ahead.

Okay.

However, you should know.

In tissue from kind of arguing mega and encourage them to day, because you've got worked on cash and leading day. So I felt like a woman. So for you from that like how did you say you will triple from Eagle Who's with Chicago now.

Some young chat logging in Neogen kitchen.

And I will translate for myself and sanitizing you would put that makes it have an impact on the overall wrote off line activities and how is the progress of <unk>.

Enterprise service recovery and how to look forwarding tonnage under one thank you.

As I said I gotcha.

And in the body as well.

National General then capitalize should all part of non catch up with a little bit larger accounts, although even Kevin deteriorate tissue mill that had upending all day.

We wish all of them industrial hygiene value channel downtown channel, where more of the capital you don't need time to have the old assets, how would you address that.

The only time down from what other going forward.

That's what all the high end unquenchable I'll hop in the shower isn't as you're all well.

As you can see Panama.

Two clubs.

So dollar to the us anytime day or the CTO, hoping not to give us not only in Nashville loans that should yeah, you can show that to you.

Oh, Okay I didn't have the tangible net worth about cingal.

Okay. Thanks, a lot more clarity when we hear about your Oh, Yeah, Oh, yeah.

Daughter.

As you usually do.

Sorry, a mall, yes, you got to not only go to Shanghai expenses.

Channel positions from TV, and obviously that I'd be able to do without having to go from one of the idea that you seem like always in basketball and that's always true.

Oh, sorry, I, you know what kind of a day.

Okay.

Yeah hold on the people who are truly value.

Moving onto the chip for him on the digital hired from weather scenario.

A few days to answer here.

How do you use a quota bureau.

She didn't Japan from what.

If oil goes back to Shanghai.

Now to say hold on potential channel designated.

With after the Codell wells that you all have operating the Dorothy which incidentally I can share those down although it anyway.

But I think almost all of them in the <unk>.

Or how do you think with your should that yard you should have got immunotherapy.

For cohorts, you're going to considering the chatter here for some time you pencil from the highest.

Well from taking any of that.

The timing is right they.

Sure.

Cleveland I believe I heard it.

No.

Thank you.

Thank you for your question, Josh N and M S.

As we mentioned earlier it just started from late August of 2020, we started to we started to have to hold off line events in Shanghai as soon as the domestic Richard.

Dress.

Spreadsheet, where I'd love to get an initial elicited and this event were highly praised and.

Again in December early December in Beijing.

As Paul just mentioned, we successfully hosted our featured Wise 2020 conference.

Which is also highly praised by industry and all kinds of new economy participants.

<unk>.

Extended the agenda setting and the gas invitation for this weis and <unk> efforts. These efforts are facilitated this.

This why is 2020 to achieve a record high of online and offline engagement and even though we extend the scale of this conference, but the GP margin for forever.

Wherever offline events.

Do you retain the high level so.

So that's you can see that we are still.

Retain this ability to hold this off line events and falling the popularity of the wife's conference we hosted another off line events.

In Shanghai.

[noise] forever to see IP amazement series and this event focused more on like youth culture and.

Connect is emerging Chinese consumer brands.

Potential consumers.

And sorry for this year.

No new I'll break them and.

And we believe there will be a strong recovery as well.

Our whilst the series will.

<unk> expense will be expanded across a wider range of industries and regions for example, the cash.

Coming GP LP conference in Hawaii.

Features industry summit will be held in Shenzhen soon in this may and more to see IP well be launching.

In Shanghai, Beijing, and other cities this year as well along with our growing and a broader user base and as I just.

Shared with you also some new offline ip's like <unk>.

Exclusive seminars on strategy a strong way.

And the industry interview by Thursday, KR, Charles we're quoting we're launching in.

Fourth quarter against the backdrop of the integrate our integration of the private and the public market.

So to sum up we are strengthening our ability to serve the free.

Friends and new economy participants.

Better with more offline English Adas.

Thank you thank you Josh and for your questions.

Oh shit.

Thank you.

Due to time constraints that concludes today's question and answer session now I would like to try to call over let's call back over to the company for closing remarks.

So sorry for that for the time limitation. So that's that's where for for US today. Thank you once again for joining US today. If we have further questions. Please feel free to contact us or six KR Investor relations contact information provided on our website or a day.

P S N growth Investor relations.

Yes.

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Thank you.

This conference call you May now disconnect. Your line. Thank you.

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Hello, ladies and gentlemen, thank for standing by for <unk>. So it is ex KR holdings incorporated fourth quarter and fiscal year of 2020 earnings conference call. At this time, all sports you said pension listen only mode. After management's prepared remarks there'll be a question and answer session. Today's conference call is being recorded.

I will now turn the call over to your host she landed IR manager of the company. Please go ahead your lender.

Okay.

Thank you very much Hello, everyone and welcome to cirrhosis, KR holdings fourth quarter and the fiscal year 2020 earnings Conference call.

Company's financial and operational results were.

Earlier today and have been made available online you can also view the earnings press release by visiting the IR section of our website at IR Dot Thursdays KR Dot com.

It depends on today's call will include our co chairman and the CEO, Mr. Doug on phone and our acting CFO Mr. Shan Li.

Mr phone well start the call by providing an overview of the company and performance highlights of the car in Chinese followed by English integration. Mr. Lee will then provide details on the company's financial results before opening the call for your questions before.

Before we continue please note that today's discussion will contain forward looking statements made under the safe Harbor provisions of the U S. Private Securities Litigation Reform Act of 1995.

We're looking statements involve inherent risks and uncertainties as such the company's results.

May be materially different from the views expressed today further information regarding these and other risks and uncertainties is included in the company's prospectus and other public filings as filed with the U S. SEC.

The company does not assume any obligation to update any forward looking statements, except as required under applicable law. Please.

Please know that Thursday, KR earnings press release, and this conference call include discussions of unaudited GAAP financial measures as well as unaudited non-GAAP financial measures.

Ex KR <unk> press release contains a reconciliation of the unaudited non-GAAP measures to the unaudited GAAP measures and please note that all amounts numbers are in RMB.

I will now turn the call over to our co chairman and CEO Mr phone Paul. Please go ahead.

Yeah.

I'll hit that at all.

Okay. That's an element I didn't mean anytime you have you said <unk> you probably got hold them down we.

Thank you and Hello, everyone. Thank you for joining us today.

For him to tell them convenient don't just your standard.

Okay, that's all from Hill.

The price you guys here are in line with foundation.

Sure.

I'm not sure if they don't seem to have even in.

You can watch out but don't on those items.

One was either to that application.

Well Timna because union go down due diligence being price, where San Jose is jumping on why don't you.

You have to go out to day on this you called that as you go from let's say you don't see what Engel from that you got me.

Tricia channel.

So you are talking about almost exactly four generic contact our argument.

Before we begin I would like to extend my sincere gratitude to all of our stakeholders for your continued support over the past year.

2020 was an extremely unusual year for the whole world and also for our business.

With many companies, we encountered a borrowing degrees of challenges and Nicole.

And Amit uncertainties.

Stemming from the widespread impact of the COVID-19 pandemic.

Thanks to proactive responses from our suppliers and our exceptional employees.

Zero timely adapt patients who changing market dynamics, we believe we have weathered the storm.

Having similar fully overcome this short term obstacles other phone handhelds are evolving to be stronger.

And we are entering 2021 from a position of strength as we return to more normal business activities.

Yeah.

So again, that's the hottest share from the host immune highest flow to the other day, sometimes they aren't even Andy you said you'd hope akshay accounts in that analysis at all but.

So you mentioned share go channel and they all day on wireless.

It all from knows how long now.

Good morning.

The second one interest single Columbia going out.

So I mean, it's another initiative.

So you'll need to do I can't be altered element.

You got it she cannot be they don't know we had no major deviation. The pizza day, how you would you say that Youll Janeiro people don't put out windmill 12 of them put on sales.

Okay.

Oh go ahead Joanne from Honeywell.

The growth of.

P. J. Thank you said from Q2.

You don't do it I'm going to close them down.

Okay.

Uh huh.

First of all we are proud to have concluded 2020 with strong traffic momentum in the fourth quarter across all of our core platforms and the major third party platforms.

Thanks to consistent delivery of high quality content and diverse distribution channels.

Total average monthly page views reached a new record high of $632 million for the full year 2020, increasing 48, 1% from the prior year and 11, 3% sequentially.

This stellar performance marks our 11th consecutive quarter of PV growth and further validates that our ever growing and engaging PVC and UDC content.

Is resonating well with our expanding audience.

In addition to upgrading our own platforms to effectively improve the rating and the viewing experience all of our users of our efficient use of a third party traffic platforms, such as Don on book.

Billy simultaneously Dep has all of our business growth by driving additional healthy traffic growth.

And to me, it's actually diesel she'd only go decision and one that sometimes they finally.

Hi, Ethan.

So, adding hot and Antonio will then just all she didn't bother until middle zone.

Are you doing in tune down a lot of them actually two of them. It goes down when they went from time.

Oh, that's right now.

Although probably in line Youll do the decision they want to share the home.

They also do the onetime elements you're bound to do you know how many would.

Would you say that it won't come out Youre talking 10 items with you should have meant that each one of those who come here and Yohji Nagle sorry. If this is you do well then sales even higher.

Chamberlain anyone that I've alluded to.

I don't see that I have Mr. Bob Hirsh I N T.

I have to do a share which I'll just say as usual.

And they own the channel how should we see them as I said, if it was somehow.

Average content creation and production capabilities have gained momentum as have our UGC production and distribution capabilities as well as other monetization abilities for the 2020 full year, we produced 108000 pieces of content and increase of 16.

Percentage year over year.

Besides our superior quality content creation and production. We have also strategically created compelling library of insightful user generated content leveraging of her in depth data insights into user demographics, we proactively help institutional.

D C creators they terminal apart weighted topics around which they can create a compelling content in the fourth quarter, our UGC offerings accounted for 67% up over total content offerings up from 48% in the prior year period and 68%.

And in the prior quarter the increase indicate that we are well on track to strength in labor content platform capabilities.

From the China. Thank you then you'll forgot it doesn't kind of go for Ginger.

Ginger closures, how COVID-19 hit the hardest channel has your cultural hopping to utilization on how are you doing.

Santa Clara CCT autos was after day one.

You're certainly within the.

So long ago, when we only had one more quick one sometimes it doesn't have to hold it as a piece of it in 'twenty.

So when the Teamsters Union with Vinci enrollment within cookies, Chris Shaw from the hiring are you can you talk.

Honestly I don't have one for.

So I just want my bathroom below book.

Even though China NGL Sidoti I completely agree that shouldn't go with your line.

We will conclude and leave it sounds like in the fourth quarter in Oklahoma in the whole year.

Our insight for business with search spanning a broader range of companies and industries continues to gain popularity and virus markets. In particular it is widely praised among security market participants Tucson, our information is invaluable.

Bridging our new economy community centric resorts networks, we are spearheading the transformation of timely and in depth analysis of public companies by covering their pre and post IPO see this for instance, we publish exclusive and thoughtful business overviews.

An area of newly listed Chinese companies, such as rack technology and <unk> from <unk>.

Inception to their ipos the deeper we go into our research expertise and experience. The more we are able to extend our services across a wide spectrum of industries.

So you have made on Telemundo out when they want to know his own got hit in the weighted toward your procurement is anytime they want to not only when the question was around Mercedes Channel 10 hour day.

So this is at all from a can.

And also day nail down unless you do it Oh no no no.

Can you give you an entrepreneurial.

Present and publish in channel.

<unk> have you tell me how well it was one of them.

I don't think you should have been moving that goes well put out on the channel has settled.

From the kind of how you're going to talk.

How about somebody who was running up into that having said all pending consensus your.

Torture, it until pulling out and told him on the book contribute today is people moving in the half with a couple of those hanging too because it wasn't all children, they're looking to get an idea on the legal transition. So now talking about E County, two zone.

The information we cure it is available in a variety of digital forums clearer trends in video how quickly in March as a top choice with our considerable capability in this arena the rapidly growing BDO market presents a huge growth opportunity for us and we significantly.

The increase of our engagement.

Across our broad demographic in the fourth quarter average.

Self produced video content has spurred us to become one of the most sought after organization accounts, a leading video platforms such as scalability, where we hosted more than 600000 followers. In addition to availability we continue to work with other highly traffic platforms too.

Hence other monetization channels, although in our KR finance account has more than $3 6 million followers and we are ranked among the top 30 video creators in the finance segment. We have also distribute it monopole trend setting short form videos on volume each gaining over.

10 million play back the high engagement level and the rapid growth. We are hearing on these influential social platforms are excellent barrow meters of our success and successfully activating our growth strategy with Cumulus abating content.

So there should be 100, almost without their own core collection.

Like many people well, maybe the type of debt and so far today, even when anyway, Jamie and from the whole bank.

As video content continues to be heavily sought after by innovative users companies from virus industries and governments, we have father's day plan, our strategic cooperation with prestigious partners on the content production side, both domestically and overseas and including our strategic share.

Our holders.

So you can enjoy with Yoko Kimball and then one of your debt tenure holdco debt.

Ted on the Mississauga on Hydro all of you who do that because you had maybe it goes all back to real quick.

So should you be able to achieve VJ could you put them on quake Huntington.

And again, they all have their enemy from Louisiana.

Fisher.

Thank you James I'll take the in.

And on the community.

So anytime you're probably seeing share San Antonio channel could you be a knife.

Oh, well the hydronic also interest will come from China.

Sure the needle the intangible I haven't seen Ohio, where can I see.

Following last septembers announcement of our strategic collaboration with <unk> in December 2020, we became the exclusive tech media partner for Youku first production of the tax focused.

New year's Eve gala future imagination technology building, our industry, leading content and resource capabilities. We featured our insights into futuristic technology trends under the impact of debt as.

As well as helped screen and identify new economy companies, who showcase their innovative products and future technology ever event going forward, we plan to co produce more high quality content covering a wide spectrum of business topics and explore the possibility.

<unk> multi channel network MCM business.

Well I mean, as you know I'll I'll say.

Oh, Yeah shipping day one.

I mean, Jamie this is alejandro.

We don't you know you've had a bunch of little means looking at Joseph a little hotter in Kenosha.

From your <unk>, you don't need Oh, sorry to hear that.

Obviously, there from what's yeah, that's just all hotel channel.

How long I don't know you're now hoping by Pfizer.

Yohji nail color.

Roger can get anyone's gonna have been put on hydrogen that will deal with.

This March we entered into a strategic partnership on business centric video content production and new economy focused services with China's major media outlet format with a share dimension to embrace the involving new economy environment across multiple Chinese consumer brands.

Are adopting digital transformation, we kicked off the program production on the sponsorship.

Promotion for our hardest joined proprietary program the great Chinese companies as part of the partnership. We also have future plans to work together to discover and retain talented talented content creators.

Business wise content that fosters a vibrant content ecosystem and at this time to explore.

Our monetization opportunities.

Actually I have left from here.

This channel will mention that has transitioned from to your condo tissue volume will have a huge I assume.

Closer to get even with your wholesale channel you feel youll generic.

We can put on your Hot day Precluding you did with <unk>, how should we be illegal.

Teach them for Sundar Chinese you literally.

Turning to our monetization efforts in the light of the intricate margin environment. During 2020, we were responsive to seek opportunities to transform other core businesses into a more contract political on the scalable model at the same time, we have been actively work.

King on tapping into emerging markets mined in the aftermath of the pandemic by leveraging our premium content and capability and the concepts consistently optimizing technology and data insights across segments with increased our ability to capture new opportunities.

She is underperforming.

Starting in charter type of items you found out did you even county, the Endo went sideways, but EBIT, we leave it with you excuse me and I can't say I can't channel.

Yeah come on line the higher duties.

That's gonna do Atlanta, you're getting on that.

Well I cannot tell you what do you what's your goals and I'm sure you can comfortably achieve day, but he said no no hold on ROE towards our run in Guangdong.

12, net sales what are you telling me about it.

Your line of sight, Angela ease up on time.

So it's only the hurdle so behind your channel we can do them.

She cannot there's oil position shouldnt put antidumping passenger door quota and they buy a course inherently high right.

From what you would have us here too.

So that means that window.

In terms of other value added enterprise services.

Segment, we successfully hosted our highly influential new economy annual summit in Beijing from December 2020, including both offline and online activities, otherwise 2020 event with the theme of rice and return they charge a broader spectrum of industry wide.

And the keynote speakers attend.

Attendance at ever offline venues and the life streaming sessions were better than expected.

Over the course of the three day event more than 22000 visitors joined us on site and ever live streaming sessions attracted 319 million visitors across our core and third party platforms.

Reach of these prestigious events not only had a positive impact from another amortization, but highlights of our ability to continually enhance our brand recognition and expand our consumer customer base.

Not just domestically, but also abroad as a number of overseas.

New economy participants access our live broadcasting sessions.

Suitable in any channel.

Before or might that not equal again put on how you're doing on why this is such an NDA Lehigh any of that she is oh what I.

That's what I always tell the pinch out chassis piece of the Cheyenne Engineering HEICO holiday downtime.

We have a bundle of man film and I think that's Washington, Nicole <unk> from <unk>.

Hello away from high emphasis.

Hello, Hi, can you hear me cohort parallel if I can't seem to change.

You being combined with some interesting ideas, how cool which enables audience.

Well they'll come to us from a viewpoint.

As normalcy returns to most of the countries offline activities, we remain committed to cultivating diverse learning communities for different industries, and capex by connecting entrepreneurs and executives in the same industry became more effectively share and learn best practices to better.

Taco shared industry challenges.

These initiatives are also designed to help us generate leads for our subscription services. For example, our exclusive seminar on strategy don't wait and the industry interview fibrosis KR hung up with cooking have helped clients in both traditional industries and new economy sector.

<unk> to explore and discover new opportunities in areas, we were not previously familiar with.

While achieving efficient customer acquisition and the building collaborative business connections to access more resources and growth opportunities.

Can you just really don't have to share those with attitude that has.

You don't have to depend.

And so should anyone wish to equate to hold many of them at least that there hasn't been that easy to talk about but I'm, just saying to yourself or title unless you do have this user.

That's usually the banquet.

How do you tell them from that at all.

You want to hold onto the TV shows.

You told us I don't think about it.

Sure.

Once again, we don't want it cannot roofing one for you as you go into it to them. They are not shipping, which you said that haven't been Tangela Sudan television. This was a hydrogel behind excuse me up a whole non China should any of them, saying, hey, the timing for the tangible quota.

Well I'm, telling you can book to me and hold all of that.

Pencil.

Given the ubiquitous the format and the massive margin in China, We began actively exploring commercialization opportunities in video content. This is a natural.

Evolution of average capabilities and in the fourth quarter more than 30% of our service solutions adopted a BDO formats and have received positive feedback as video content and followers rapidly grow across our core and third party platforms more traditional brands increasingly want to work with us to.

Capitalize on these translating market strategy. For example, we originally signed a contract with one of China's leading direct competition to create a digital our digital marketing plans by our self produced meetings to make kids yogurt product RASM.

With young consumers as we further expand and diversify our product and the service offerings, including our robust video content, we will continue to explore strategic collaborations with more prestigious partners.

<unk>.

I think that goes from here.

So I cannot tell you.

So we've gone from what we don't have the same channel.

Concurrent with the conversion units year. She can empty methodology. So we don't have any of them from doing it you always you don't quite irrational.

This Tuesday, we just on non strategic cooperation with Chinese State media Cctv's program, the growing of the great brand supported by multiple online and offline activities. We will use our diverse services and a strong resource networks to help a large number of Chinese new economy.

Enterprises to enhance their brands and propel more coordinated business development along your supply chain.

So I think that's moving.

Yeah, well maintenance, which will occur he is going to be the so if you do hurts you would've. Meanwhile.

What I didn't see from growth to junior debt <unk> go forward here.

Okay.

Total.

Total residential zone, whether tamu before the human beings out on my phone to Apple can you share.

CF, where they're going to channel.

<unk> heard you and I hope, we don't have a great comp.

Okay.

Yeah that hadn't been fluctuating Aon Hewitt as usual T shirts, Angela limitation, which engine that she's route if you want a mobile switching how're you go Yo Yo today, you don't see it on the documents as you want to just annual efficiency of Wolfgang <unk>.

You just don't know who I'm, telling you that you can grow the team.

As soon as you touched on this as well.

While many people have you kind of what <unk> done that on little items.

So you can be in that area.

Can you tease out ICF will give you from me.

In terms of subscription services in the fourth quarter, we launched a new and upgraded version above or Enterprise service review website.

<unk> Dot Thursday, KR dot com in order to view China's most professional platform for enterprise level application and services selection this comprehensive new offering.

They both are potential.

Potential buyers to few of the information GAAP by providing the rank loans and feedback for application and services from real user on the platform.

Enterprise service providers can simultaneously upgrading our products to spur a cyclically address the dynamics feedback of users as well as capture potential customer needs and sales lease.

So with this innovative service is to form a virtuous business cycle driven by powerful content offerings. This is a natural per session and extension of our own enterprise service.

Carol will also potentially helping us involved into a more scalable.

Subscription model with higher customer thickness, we plan to utilize our large scale enterprise now worried community to boost traffic for our new platform.

Building and Enterprise services Alliance community focus on number of Enterprise services review business.

Well, if we were telling you that it was a four day count for <unk>.

She has equaled our C&D put all the team for some channel to Atlanta, and Charlotte will then just share. Some of these shows to handle coupon of Hong Kong again, because you don't really does your cash is just one other noteworthy type.

George I wondered from here forward, that's what I'll tell you what we put on a.

Tablet on these shoes, you're finally here you tend not to consider to sell more to them.

So I'll just tell them away from again trying to deal with that.

Well I'll say it that way.

And as you saw pretty interested he Goldman Sachs, because we'll choose up imagining into our assortments of haulage from the Hello.

To view.

To your channel.

Our innovative and creative services getting further attract the traction with new government collaborations during the fourth quarter. For example in December 2020, we supported our local municipality to host and air and Aerospace information from eight in Hangzhou a.

<unk> local industry seminar, we also aided local governments in planning and developing smart cities concept without a serious of entrepreneurial contest focused on smart city projects across different regions in partnership with local governments, our strategic focus on government.

It'll collaborations not only raises awareness of our brand, but also places us as a from a forefront of or compute opportunities in cross regional economic growth within the new economy space.

So Sean maybe point out that not only hard EMEA because if they don't have a shot at line do well then.

Sir you said don't share we'll share it.

You see them put them behind us should help denali.

Tom do you want to necessarily sit here you can see the initial when we guarantee it would put a phone call or in the time and hopefully we'll touch on CDN essentially in line with Dan Shaw, who don't put all deal with usual put on Toyota class at all.

So even with your getting you show season, and they only floating NAV when we don't really per se, but that's another shandong per well, it's an amount a few people don't have items you got you.

In summary.

The challenging 2020, and the fast evolving market dynamics, we continue to build.

The build out of our core strength at the same time, we demonstrated our ability to swiftly adjusted other cooperations.

And operations to align with the changing market and reach our sustainable growth goes over the long term with the pandemic largely behind US we will work to strategically.

Product and service offerings hands on networks.

The increase of our user base and diversify our growth avenues to strengthen our monetization capabilities.

Go to content and service platform from China's new economy space, we retained committed to capturing additional opportunities in the growing markets and delivering long term value to our shareholders.

With that I will now turn the call over to our acting CFO, Mr. Shan, Li who will discuss our key financial results. Please go ahead.

Thank you Yolanda, Thank you Hello, everyone.

Hum holdings hedges from lingering.

The impact.

From the COVID-19, pandemic expanded into or force culture pulp high performance, however, revenue from or online or the replacement services.

Description services.

We're.

Crucially.

Growth.

Which we see.

Gross side also a gradual demand recover given the challenging environment and the license. They learn we havent been acuity of jobs or business operations in order to achieve long lasting deficiencies multiple day or gross margin.

<unk> by 400 basis points to 42 per cent in the fourth quarter of 2020 from the third quarter.

They also realize the full day key operating cash flow for the FERC continuing culture.

Some of them.

Somebody filings.

<unk> resilience and agility of our business model.

Finally, we continue to see or to see quarter over quarter improvement or accounts receivable. After we made or prepayment policy adjustment on the pipestone requirements for the truth.

<unk> offers quality clause.

Hence or cost true ups.

<unk> content production capability and the book or on the border or monetization channel. They believe they are.

Well positioned to serve new economy participants on the girl alongside with them.

Now I will go through more detail or fourth quarter of 2020 financial result.

Or total revenue were $121 million in the fourth quarter as well for 2020 compared to 300 from history millions in the same period of 2019.

Your line, although we're pricing services revenue decreased by 54% to $69 million in the fourth quarter as well for 2020 from 150.

100, <unk> in the same two at all from 2019. The decrease was mainly caused by the big demand from certain other Tyler and the assumption of all four.

True true variety of policy for customer selection.

Price the value added services revenue were $41 million in the fourth quarter of 2020 compared to 140 <unk> hundred 54 meeting in the same period all from 2019 the.

The decrease was mainly caused by the decrease.

<unk> revenue from.

Integrity marketing services.

Commonly decrease includes certain venues.

Subsequent option services revenue was $11 million in the fourth quarter of 2020 compared to $18 million in the same period of 2019. The decrease was mainly caused by the decreased move revenue from universal subscription of some of the off line training.

Classes were cancelled due to selective impactful from COVID-19.

Cost of revenue were $71 million in the fourth quarter occupancy <unk> compared to 166 meeting in the same period of 2019. The decrease was mainly caused by the decrease in revenue gross profit growth.

$51 million in the fourth quarter of 2020, compared with $2 $156 million in the same period of 2019.

Operating <unk> were $127 million in the fourth quarter of 2020.

Compare to hunker.

7 million interest interiors of last year.

The decrease was mainly due to the increase in G&A poses in the fourth quarter of 2000 expenses.

Sales monkey Princess work.

35 million the fourth quarter of 2020 compared to $15 million in the same period of the 22019. The decrease was mainly caused by the decrease in payroll related expenses on the share based compensation you posted.

Ken.

Yes.

<unk> and Avi poses for 82 million in the fourth quarter also 2020 compared to 47 million in the same period of 2019.

<unk>.

The increase was mainly caused by the increase moving.

Allow russell for thoughtful accounts, partially offset by the decrease in the share based compensation proposals.

RMB pose this decreased by 12% to 9 million in the fourth quarter of 2020 compared to $10 million in the same period of 2019. The decrease was mainly caused by the decrease in share based compensation you posted.

Share based compensation expenses recognized in cost of revenue.

Sales and marketing.

R&D expenses and general of NIM because it in total.

In total were $9 million in the fourth quarter of 2020.

The six <unk> six the meetings and the things he rode off of 'twenty Nike.

Other income punches well per million in the fourth quarter of 2020, which includes a loss of <unk>.

16 million from equity method investments.

Zoom calls.

$1 million from government grants.

Compared to others income.

Two men is in the same period.

2017 Nike.

Income types of deposits were $4 million in the fourth quarter of 2020 compared to $20 million in the same period of 2019. The increase was mainly caused by the increase in the allowance for deferred tax assets net loss was 19 million.

In the fourth quarter of 2020 compared to income of 32 million in the same period of 2019.

Note that the adjusted net loss was $81 million in the fourth quarter of 2020 compared to an income of 68 million in the same period of 2019.

Net loss.

Beautiful to surface ex KR Holdings, Inc. Ordinary shareholders was 91 million in the fourth quarter of 2020.

Compared to income of $99 million in the same period of 2019 mentioned increase.

Occur accretion.

I'll return within book Bowl.

Non controlling interest.

Our creation on the receive side nation effect of convertible redeemable preferred share.

Basic and diluted net loss per share was book.

Zero point their line in the fourth quarter after 2020 compared to the based on the diluted.

Net loss per share of <unk>.

<unk> one on the 0.03 in the same period of 2019.

As of December 31.

'twenty 'twenty.

The company had cash and cash equivalent restricted cash and short term investments also.

$209 million compared to 264 million also at.

At the same time in the last year.

To be mindful of the loans off our earnings call for the first full year of 2020 financial result, I really encourage listeners to refer to our earning price release for further details.

This concludes this concludes all of our prepared remarks today, we will now open the call to questions.

Operator, Please go ahead.

Thank you as a reminder to ask a question you May press star one on your telephone to withdraw.

Your question press, the pound or cash P and please standby, while we compile the Q&A roster.

Once again for your questions. Please press star one.

For the benefit of all participants on today's call. If you wish to ask questions to management in Chinese piece immediately repeat your question in English.

Your question. Please press star one.

Okay.

Yeah.

Yeah.

Our first question comes from the line of.

I D G of credit Suisse.

Please go ahead.

Yeah.

Oh.

Hello, and cheeses out when you don't need gross if you do take.

Uh huh.

Oh, Gee, Oh excuse me.

Richemont that isn't yet.

And myself so good evening management. Thanks for taking my question I just have to have a pick one.

Just wanted to ask I'll add demand by vertical how does it trend in the fourth quarter. Thank you.

Yeah.

Oh, Okay. My day, the cohorts are interested either.

Finally, although in share.

It wasn't the whole you can pay off well equivalent per well there were some financial loss from these it honestly.

So we'll just have in Indiana.

Got it.

Toward that end up I know you had said here's what they tend to book an honest with you.

So she was on anyway.

He didn't get a cohort sales representative gamblers, who know how to tell you things you get.

Here's what I'll say non television to agricultural because there was a hint towards non op has your provision.

And I'm sure you can answer that one for you here.

So all else equal the philosophy, Joan Tong from Black.

Turning off the whole channel.

He is gonna be a share Salvation Hall.

From a CFO.

Yeah sure towards the dry ice as you go into them I will tell you hired up on how the final negotiated with Ono. So your woman.

The Ohio shall be U K Schmidt from.

So essentially we didn't see the.

Because then you can be car companies are knocking on the door zone.

Okay. Thank you for your question Avi.

I think.

Directly on the customer at the mine site over a multinational.

<unk> customers have been affected the most leading to delayed budgets for advertising.

However, since Q3 advertising needs from some customers began to recover like what's worth being in.

Automobile and three seats at the same time, a quite a few of the Chinese consumer brands, which are which we actively reached out in the second half of 2020 show their growing demand for our platform.

Another characteristic.

Our new economy customers. They showed their resilience during and post the COVID-19, and their own businesses kept growing.

And does this contributed to the increases in the number of customers and our average customer price in this year, especially when it comes to those TMT Giants and Super Unicorns.

We can share some more color on the industry distribution. The top five are in 2020, our consumer Entertainment Enterprise services <unk> and E Commerce, Besides where we also saw strong demand growth for our advertising Edward.

<unk> services in the AI and online education industries, so to sum up we can see that we.

Ashish.

Is nearly 36 percentage.

Sequentially just to correct the mistake.

Mistake.

And if.

If we see and in the last quarter. We can see this sequential growth have already achieved as 63% present in the Q2 are free. So we can see these AR consecutive recovery from Evercore.

<unk> segment.

I think this is for your question. Thanks.

Okay.

Thank you.

Our next question is from the line of Vincent Yu of Needham and company. Your line is open. Please go ahead.

This is disappointing from.

A hole there that once you have EBIT neutral going to argue that you want to ship, we will make sure that your distributable cash.

Uh huh.

Yes.

Due to the differences from the Gambro, which you should square Newswoman Jacob <unk> gross.

The whole Jay good growth.

To close on Youtube channel.

As you book The Inc. Susan like you said was true.

She knows it issue vehicles from 'twenty to that country. The Schindler, Panama financial income measure growth. My question. The first question is about.

Hopefully 'twenty one outlook.

Outlook can management share some.

A few things on the fiscal.

Fiscal year, 'twenty, one outlook and where do we see the most potential.

In terms of revenue growth and where are we investing the most the second question is can management share some insights on the share.

Mix in first quarter.

It was pretty drastic so what drove the ships and.

Is this going to be the new normal going forward. Thank you.

Oh as I sit here that's in Sterling.

Well, our the net organize what's your kind of an almost day I sort of your balance sheet went out of India.

So you can book.

Yes, Hello, gentlemen, three or do you really just don't.

Although the accounts.

And our final minutes after that have northern she that's hardly at all.

I wish you can clearly that you didn't include the adding it all from how the year to.

If you go to each other non Lindsay we can understand when the non tissue potentially here with us on accounts and that's what you will have its own content.

I don't share the Ohio largest shambo, Josh Nichols, sometimes on Hudson Nikola interest the pencil to official open day, you've got to nationally and also talking about kind of the law, which is our chief we actual financing.

Yeah.

And Nashville email then until the Asia most of the time, so he already argument when the debt if.

Well done.

Judy.

And then is that what the whole household debt that'd be away from go, especially what's actually telling me. This autumn day trying to quota share.

She said rather either any day, we have Ohio.

So have you already are in yen, which as you know people want to tell them that so it sounds like this is really young toilet volume you can live with a tissue.

And Youll see Youll hindrance to our sales you probably.

So kind of what did you say.

How should we do channel checks all through <unk>.

Oh I'm, the chief walkway I think they are attempting.

I mean in the future.

Alright, thank you.

So that's essentially the way I kind of alcohol here with her wallet share for total.

So you know what I think you guys relative.

So once you are in niche and then that kind of top tier OEM share also the ddos.

So if that happens do share, Oklahoma relative to that I kind of I don't know I'm just curious within cheap.

To go on day, arguing in Korea that you hold them in doing that I forgot, which I think went into as.

Well as income.

To your original guidance.

So if we were from you know Tim go down there you go you can sit at home and well then thats a tendency with Christopher Todd.

Thank you.

I know that these two well then we're going from sort of equal size.

Let me tell you.

Hi.

<unk> was one that you got from both of them.

We'll take compute.

Compute grew more confusing.

Good day and Humana.

Building, the we don't want because items.

He was old and tissue of administration that you forgive me want to sit down at County line.

Okay.

So what kind of people, who don't play elements as you do with US it was a little bit more.

Marty the presentation.

Sure.

He didn't know how to deal with.

Hey, listen.

Oh. Thank you so much Vincent for just two questions and I think these two questions are well linked so for your first question to comment on our outlook for.

This year I think.

Like a floor for us and for most of the companies.

In China, and globally, Twenty-twenty must be very challenging year and jobs.

You know from the macroeconomic level and for the fast evolving market dynamics. So we are this situation made us to think about all of our business from a longer perspective and.

But also in the short term we are.

Also proactively made multiple adjustments in.

In our operations.

In the short end.

Medium term, maybe we will remain focused on our video oriented strategy and to explore opportunities in broader address a market for it for ourselves I mean for the private and.

Public.

Markets and a second.

You can see we are.

<unk> already explained for a longer.

<unk> term.

And both of our business model into a more scalable and counter political.

Expected.

Maybe a day or Chris a never enterprise value added services. This year, but we believe it's extremely important for our longer term developments.

For in this year of our advertising site, we expect that continue recovery.

In this year, just like we per box.

<unk> Q3 end of Q4 and.

And at the offline.

Activity restrictions, our total unloved assets I believe our offline businesses, well continue to restore and b strengths and.

On the investment side, we will keep investing in our technical and data capabilities.

As so as to facilitate the evolution and upgrading for forever current enterprise value added services and the upper subscription products.

As well as to innovate other new products.

So to sum up we will see the main driver will still be our.

As a b S.

And for the for the second question as you noticed that.

There is a little bit strong.

Structure changing for forever, a fourth quarter, but it's actually off from the from the whole year's scope.

The enterprise V S, where still the top contribution to our total revenue.

Around 50% and.

Compared to the advertisement accounts for 40 44.7.

7%.

As I just shared a share.

The idea that the structural change brought by the pandemic impacts will mainly line a number enterprise value added services. So we made this.

Prudence adjustments and.

Involved and into a more scalable and a counter political model for upper enterprise value added services.

Over the last two quarters in 2020 and.

At the same time, we cut down some low margin operating and marketing business, which is accounted for the most of any number.

And enterprise value added service segments.

So that's you can see that's why the revenue of the enterprise value added services in Q4. The price. However, we believe it's also abroad already a higher GP margin and their continued income and continue the improvement in.

<unk>.

Cash flow for us so.

These are for your two questions and thank you for your question Vince.

Yes.

You bet. Thank you.

Thank you.

Our next question is from the line of share and Youll see ICC. Your line is open. Please go ahead.

Okay.

However, you should know we're adding in tissue from kind of value, we need to be going into Eaton today, because you've got well don't catch all leading me I got line.

A woman she for you was on that.

Like how long you think you will triple from Eagle Ford switching.

Now I will make some young debt logging in children kitchen, and I will translate for myself in plenty of time for you to put that makes it have an impact on the overall wrote off line activities and how is the progress of off line Enterprise service recovery and how to look forward into 2021 thank you.

Gotcha.

In fact sheet in the body as well to go national wardrobe and conversation off line.

There's a little bit larger accounts.

And I'm curious is your mailbox how'd, you're finding a whole day okay.

We wish all of them industrial hygiene value channel, our downtown channel where more of the capital.

Although she can only count although that sometimes you'll have to wait and wait times out from what does it go from what.

That's what all the high end unquenchable I'll hop in the shower isn't as you all well know type items.

I'll, let you go to Colorado.

Sure.

Anytime you try to take a CTO, hoping not to give us operating Nashville Orlando.

Yes.

How does that how do you.

Oh, Okay, I didn't have a tangible net worth about on Cingal.

Okay. Thanks, a lot more clarity when we get them bought her oh, yeah, Oh, yeah.

Daughter.

We usually.

I share your mall, yes, you've actually I always go to Shanghai expenses.

John positions or the Delaware basin, and obviously that I'd be able to do without having to go from one of the idea that you can like always in basketball.

Sorry are you know what time of day.

So these are when you see channel hold on the people who actually value.

<unk> financing.

So hillman central hanging from what the cause of IP licensing.

The answer is yes.

He was a quota you'll know weird.

It does depend on commodity.

Well, that's it from highest one way.

Okay hold on potentially from a hotel doesn't go anywhere.

QUADRA island and hold that for the quarter.

And the Dougherty, which as you I'm sure that channel Dorothy I think.

Anyway holdings.

Sure Amanda.

Or.

So I'll be quick with your share.

Good day.

Do you see from cohorts, you're going to continue.

With us in terms of intangible from the highest.

Well from taking it.

That's all the time as you would assume share finally, Cleveland, absolutely I'll handle <unk>.

Yeah.

Oh, Thank you for your question, Joe Shan and.

As a as we mentioned earlier it just started from a late August of 2020, we started to we started to hold off line events.

In Shanghai.

As soon as the domestic wages.

Dressed risk free.

Share where it left us in initial elicited and this event were highly praised and again in December early December in Beijing.

As Paul just mentioned, we successfully hosted our featured Wise 2020 conference.

<unk>, which is also highly praised by industry.

And all kinds of new economy participants.

Yes.

Extended agenda, setting and gas invitation for this weis and efforts. These efforts are facilitated.

This whilst 2020 to achieve.

Hi of online and offline engagement and even though we extend the scale of this conference, but the GP margin for forever.

Wherever offline events.

Do you retain the high level.

So that's you can see that we do.

Retain this ability to hold this off line events and the falling the popularity of the wife's conference we hosted another off line events.

In Shanghai.

Forever to see IP amazement series and this event focused more on like youth culture, and the connect is emerging Chinese consumer brands.

Potential consumers.

And sorry for this year.

No new I'll break.

We believe.

There will be a strong recovery as well.

Over a white series.

<unk> expense will be expanded across a wider range of industries and regions. For example, the coming GP LP Conference Nty's features industry summit will be held in Shenzhen. Soon in this may and more to see IP will be launched.

And in.

In Shanghai, Beijing, and other cities this year as well along with our growing and browser user base and as I just.

Shared with you also some new offline ip's like exclusive seminars on strategy, often wait and industry interview by Thursday, KR chose if we're quoting we're launching in.

Fourth quarter against the backdrop of the integrate our integration of the private and the public market.

So to sum up we are strengthening our ability to serve our friends in new economy participants.

Better with more offline English Adas.

Thank you thank you Josh and for your questions.

Oh shit.

Yeah.

Thank you.

Due to time constraints that concludes today's question and answer session now I would like to turn the call over call back over to the company for closing remarks.

So sorry for any further time limitations. So that's it for free for US today. Thank you once again for joining US today. If you have further questions. Please feel free to contact us or six KR Investor relations contact information provided on our website or.

Yes and growth Investor Relations.

Yes.

Yes.

Thank you all this country.

Thank you.

Concludes this conference call you May now disconnect. Your line. Thank you.