Q1 2021 Noah Holdings Ltd Earnings Call
Good evening and welcome to the Noah Holdings <unk> 'twenty, One earnings conference call. All participants will be in a listen only mode should you need assistance. Please signal a conference specialist by pressing the stocky followed by the right.
After the debt today's presentation, there will be an opportunity to ask questions.
Please note this event is being recorded.
I would now like to turn the conference over to MS. Jing Wang. Please go ahead.
I think you'll probably a geo care on many of the hopefully the Isa with Russia, whereby a shot but yeah, I mean I E N D T to differentiate the at Alpine High the foundation from which you kind of current live for Panther, a lawyer outflow in terms of she the on value.
The way so machine the Glen he firsthand that'd be anchor for teaching.
Oh I'm a controller at Johan Goldman for a half foreign translations for you. That's the dialogue that I can go for it.
Do you have a keen punching away, but I guess I'll keep it with the tower Shanxi still holds true for the limbach.
For the audience from Alex her day, when she needs from our turnkey only guidance and they forget the portfolio sort of jumping tweaking of the dosing will be anchored to the only you can share making the turnkey.
Free cash can wait well go for kudos, a close them in the true Shuang.
A few up.
Whereas the Egypt.
He took the.
Just for the for me and how hard the team too bad for the teleconference agenda today, our first introduced the overall performance of Noah in the first quarter of 2021, the development of a major business segments and the strategy of the growth then talk about the changes and the progress of Noah's management thinking from product driven to climb.
<unk> oriented we will then briefly of Noah's planning to purchase a headquarter premises located in the cold zone of Hong Zhao of CBD in Shanghai after that he's welcome pension to introduce the financial results of the quarter followed by the Q&A looking back to 2020, it's a yeah a full of challenges of.
Certainty, however, all stock of Noah safety of which for a phase.
With such a uncertainty continue the transition of reform and made some achievements.
Please that we lived up to the expectations of other shareholders and investors and Noah delivered a very successful quarter.
The IEA EG. The let me ask of the cash also seems so sorry. The are you able to Lindsay competes inbound passenger loads of CPE. She told me what you face a rule Sandia argue a M b Columbia turns out with the Sandy I gladly face of Lewis for the she a M. B Tobey the top pattern for would be a neal yeah, the bulk whoso city.
A C V. I know maybe from the Sundance Jr. Debate Grace will equal with the on the fake apathy in the city of Louisiana M. B, a competent that she's still did she says she had a let's say Eli the turnkey cingal.
Listen you should you find me a pass.
For Glen the Baton quite a jewel in terms of the mall GLA.
She's a day NGL EBIT of maybe <unk> Delta has had a few more to learn that our buy you saw the E. A M b a competent that far down the.
<unk> has had a is on a symbol of the Egencia teams have your mood you don't I thought you bet you saw a competent.
It won't be then the our incentive cash alexandru cingal <unk> batten the competent off patterns of the back at Noah. However, I'm glad you total sandy Thank you Ireland competent authority.
So the time, Glenn Greenwald <unk> with Sidoti <unk> beyond the adding Union index back into San Diego. Thank you pencil AUM the annuity of them back for a woman's hung onto the elements you ban of bhatia of the phone quake Congo retreating from Chapin for yachts from cohort one cohort source, the Rte Junior Aman, Bahia and frankly, the bathroom for chip.
That is a superior to all the assets on the phone quite a lot of Pedro shallow a metallic taking the queue IC <unk>. She had a whole genome should pay the tango.
I will let Alex with the U S drilling while in terms of about the oldest so a machine the <unk> debt to book a simple cold hunting should go down a couple of ways I'll show you some time with the Shanghai Guangzhou.
A couple of Dragon had right with the jeans attitude here, there's a woman of days you have been good the team for some class go out the date of the CECO against with the let me hold of your appeal for Qunar don't touch within 2000 <unk>.
Jim Woman the question couple of stool.
Jorge towards easier ways of Harley are using LTE to the noise out of the.
Guardians of a couple of tranches.
Or are you a cohort.
Income would you think should have a hotel god issue out of it can be summed up the bathroom donoso audience tend to send you a sense of humor.
A couple of Chicago Zabala of.
And it turns out that turns into a downward Craig how cohort showed that I'll go back to the site.
<unk>. The Copel is launching centrality of Cauchy tool for women that you can take and being good the Hershey losses seems even thought of the swisher continually pass the DOCSIS and a for most of the Geely Holdings Johan Towncar Cotton Glanton, Chairman I'm, taking the <unk> go down a couple of hundred Pennsylvania.
The almost breaking Shannon's hygiene youll suddenly of half of what <unk> did you increase them. So they can give us after the end of that character with a tenant kind of of the box.
Jamie like secreted with the sanction.
The past the Ollie's Army MTP, the warrants with that I'll go back to inspire the army.
And you're in the bottom of our backs the theater leads the routinely preference of India are Bob.
Laurie I don't issue guidance. He leads for the <unk> type payout for Telerik is widely tested tissue for lab pressure for a good hold of the regarding to the hotel Guardians of the cohorts you conquer notables.
What I'm, saying to you Dan.
Powers for solos.
Yes.
True.
In the first quarter of 2021, Noah reported net revenues of running the 122 billion with a year on year growth of 64, 1% in which one time commissions were learning based $323 2 million, a 53, 3% a year on year for.
Recurring service fees were <unk> $474 9 million a year on year growth of five 6% performance based income for the renminbi.
The $403 1 million, which grew nearly 20 times a year on year non-GAAP net income attributable to shareholders amounted to a historical high of RMB $461 9 million, representing a year on year growth of 79, 7% in terms of a main business segments the transaction value of financial.
Products in the wealth management segment reached at any of the $27 1 billion with a year on year growth of 16, 8% the transaction value of standardized the product was RMB $21 5 billion with a year on year of growth of 12, 5% among which the secondary market equity funds grew 23 funds for percent of young year to renminbi.
11, 2 billion setting a new record for a single quarter mutual funds grew eight 6% a year on year to renminbi 10 billion.
Net revenues of overseas business reached the RMB 337, 5 million with a younger a growth of 62, 5% the overseas assets on the management was the renminbi $25 92 billion as of March 31, 2021 of three 9% increase compared with the end of 2020 accounting for a <unk>.
16, 8% of the group's total of <unk> in March we successfully held in the insurance summit in Macau and invited the targeted talent clients based on big data. The number of attendees was 77% of the 2019 and shown a summit in Macau. However, the total transaction value of more than doubled reflecting.
Of the accurate matching the results of advocate ROTC to IP and KYA systems, which we put great efforts in share.
Aside from the financial data the management is more encouraged by the gradual infiltration of our new management culture. The management idea from product driven to a client centric survival for <unk> is reflected on the client talent and business side with a further deepening of our transformation and reform Noah is on the <unk>.
<unk> journey of building organizational capacity, which is the right way from the grain train to the E. M use electric multiple units first our core clients activity continued to rebound in the first quarter of 2021, Noah's high net worth clients the number of active clients, including mutual funds only clients.
The 27000, an increase of 65, 4% year on year as of March 31st the number of registered clients exceeded 380000, 380000 up six 5% from the end of 2020, the number of Black card clients were 990.
Two an increase of 12, 7% year on year client oriented and pursuing in depth understanding of client needs is the core guiding ideology file for our reform on the Frontlines.
The implementation of the new relationship managers compensation scheme from a single relationship manager to the establishment of the Noah Triangle service model of a strengthened process management with the supernova of quantitative client communications plan as well as the comprehensive promotion of <unk> and tell you why a received the <unk>.
<unk> of clients a relationship managers secondly, our core frontline talent after experiencing the survival of the fittest and replenishment of fresh blood have stabilized and recovered for the pilot of the new relationship managers compensation scheme. The production capacity of the team began to release after seven.
As of transformation the number of elite relationship managers was 598 in the first quarter of 2021 241 more than that at the end of 2020 and the turnover rate of elite relationship managers was only a zero point to 8% Noah will continue to improve our incentives.
System vigorously promote employee training and team building continuously empower a relationship managers screen qualified investors and provides a better services for high net worth of an ultra high net worth clients.
And yes, there is a new co pay for the tango any of the grain more about E channel Baxter for the injury. She don't February who don't have the associated to falling cofounder of the internet. So that's really the per ounce of Paraguay mortgage the future she'd have to don't value that you can touch entering sushi on the balloons into the zone. She don't go in case of how the Gwen and Grandma way.
<unk> will then see the IMD competent DOCSIS the deal.
Some of the channel Glenn a grandmother ETR of base, but she AMB combi tens of thousands of students.
I mean, yeah all of it.
So a favorable shifts the game with UGG, a way Chenzhou charts, a pretty dire for today go for it the Teng <unk>. She said you hit the timing <unk> Chatham do you think for you the change with the coffee is a way of cohorts you're going back to kind of go on attempting to the associated on <unk> for time being she talked about couple of St.
It should also be a good of course union, you're competing interest only have attempting prices for some of you may be all we got to understand a it will be outside of your attempting for the R&R Union go visit to the attempting for attempting a total quantity and time into the dwell for a minute got out a little in the IPD, the Luton Jamie in cheese and grocery the towards the granting of hurrying of co.
A copy of the seemingly pacings, Andrea who loy Yang for temperature the cocoa. She told she doughnuts free she got it.
He is the island are Union Saturday go for Apaches mom of a goofy top selling the RTC. Tom total your total tempting sent you a good for them will gradually introducing for opinion of how you see me out of the daily coaching postpones the top guys.
Attempting the lease the a different day of senior housing in the city well the absolute Division Champions League of <unk>. So you were a bathroom tissue. They are definitely attempting don't for Bob Henning Champ Athens is a.
Well actually a few hygiene campaign selling the linear hustle UA patterns of siding, Sunil Secondly, hopefully Bob having channel patterns acts of co pay the whole brokerage again hampered the eating telephone from her stewardship of the lockout in Chicago the input.
As of March 31, 2021, the a O N of Gopher reached the dreaming, the $154 1 billion among which the continue the redemption of non standardized the single counterparty private credit product from zero, a launch because of inventory and the scale of nonperforming assets were dropped to the other funds on the active.
Management realize the different degrees of growth among which the <unk> of public securities reached the renminbi $10 5 billion up 14, 5% year on year. The O M of private equity was running the 100 truck Huntington $21.
<unk> 9 billion up 10, 4% year on year in February 2021, Gopher was selected as one of the top 20 secondary funds in the world by Global a false Association.
Well book go for China equity selection from ranked the number one for us in the world in terms of compound annual return for the previous ending December 2020 for Barclays hedges swaps with <unk> on the U S. Dollar of 260 million among the asset management products provided by growth for our client growth continues to promote.
The reform and product upgrades from product driven to a client oriented is a core concept of the reform. The most important products of growth for in 2021 is the target strategy product, which implements a target oriented strategy, we invested more time and effort into product research and development investment.
<unk> and talent density as well as introduce the IPD integrated product development process to a fully elevate the folks with capacity and investment management and operation like Noah Gulf a new journey of strategy experienced a constant change from product driven to a client oriented.
At the end of March 2021, gross of macro trends mum and top 30 secondary market Monkey strategy investment products have track records of seven 7% for years were upgraded to the Gulf of growth target strategy and balanced target strategy, respectively. Now back on the market again the growth target strata.
The product realized an annualized return of 15, 24% since launch ranking of top 10% in terms of return among comparable products. The balance of the target strategy products reported an annualized return of 12, 76% of launch ranking top 2% by region among comparable products.
Once launched growth with flagship Talcott strategy products, having bringing the recognition of high net worth a clients.
<unk> salary for me a reason you analysts accounts for them early on.
The arguing NTT routine figure a way to the argue from be it sounds a lot back into the sedan.
So should the share count class of you'll have a long horizon Hello, Lee Fullilove salary of the tissue was deemed piece of non-GAAP, Jimmy Ray a linear.
In the patterns of a sense of the arches in dollars back into the says she didn't she team you are a new York Orange, Armenia, and the patterns of SaaS body U T from dollar back into this receipt flow.
I think in Shanghai for the U S. A T sand out there with the coral close all of our team Cushing consent. When when do you intend for this should help from a coding the targets in Chicago, that's been Jakob for guidance Q, finishing the mobile.
No actually I mean, you don't feel the anger from corralling valued off of kilometers from the assortment of Cushing penchant for here momentum for both the same geology, the squarely where a deal.
It's a good to see her income she paid hesitation closest to the garden G. E. G. The machine you got using the loan book since it's.
The good to see the patient you'll follow ambition for vehicles Saddam that she's also the tango Julian pack and field teams on the pulse of what because I tell you who many of you will find me a trading of gone for me into the condition of movies that had some gauge Hamiltonian, hence the hotel on the income way, though you're calling for two he then doyle filling for the return to remove that action.
Our union so lawyer of being good the two from your momentum halliburton's with a variety of entry and finally go Daniel the pensions with the cash on Thermo King Kong Hilton Guang now of a couple of for her can be done at sort of your boyfriend, hoping for that.
The impact of any chance of a downturn for in childhood.
Nishapur class that type of a.
The antigen GB salary of the churn maybe some guidance the hook with a phone call the annuity shooting a fossil a consortium the legal entities and the need for them.
Moving to trigger a change in gambro treats the symptoms out as I did.
For the ITT G. The attempting clarify the xiaomi Gwen for attempting to treat a god you don't shed a lot between the ITT schamel the rule, making on bad debt yourself with a K a I see <unk> foods. The Hassan just from book shall moving into a great found by the nature of them with GTT for the unless we see a center of the fiduciary a home. So it's only a retailer that the cohort.
Any sense of a wage agenda of Cushing Gwen to chime in.
In terms of operating efficiencies due to the expansion of income and.
The marketing activity the operating income of the first quarter of which the renminbi $722 3 million up 47, 5% year on year now of continuous online.
In intelligent transformation efforts have contributed to the continuous and stable improvement of operating efficiency. The non-GAAP net income increased from sorry. The non-GAAP net profit margin increased from 34, 2% in 2020 to 37, 7% in the quarter the operating profit margin.
The increase from 38, 1% in 2020% to 41% in the quarter. This year Noah will start to expand the capacity of the Noah triangle of relationship managers team and deepen operations in the core cities, we have set new targets for our market shares in class cities and the increase and the increase of.
Coverage of high net worth and the ultra high net worth clients in 2020 now a fully initiated its organization reform with a core of direction from individual leadership to organization of our capacity first we upgraded from a divisional structure to matrix management implemented qualification system and.
Person pose the matching and started to define in a range into internal personal levels by positions salaries by levels as well as link the change of salaries with positions changes the implementation of the new classification system optimize our compensation structure, making us more compare.
When recruiting senior talents in the market.
Meanwhile, we determined the company's annual budget of strategy.
The project in the aspect of strategy and key tasks and became more flexible to focus on other targets and key projects cities and positions.
2021 is the initial year of Noah's transformation, we aim to build an organization of processes from the aspect of culture process optimization and a strengthened.
Strength in strategic quality can show a process management to make the client service and product and operations standardized and of a high quality to integrate marketing planning into a branch management to carry out a comprehensive strategy based upon a management and to promote the internal control management system to help the operations.
Prevent corruption and control risks as well as to use the qualification system to be the growth of management team members on human resources from Noah is actively practicing ITD integrated product development project management that has established the different ITD projects on product channel and international operation.
For example, the Kols Cky P and K Y a digitalization project. We mentioned is to realize a in depth collaborations among of the streets through project operation Standardization and the appointment of project teams and its responsible presence finally everything falls into the core management idea of client centric.
Survival for simple what kind of it I would say the fact that the way that they saw a high Tony's saloon yet from the senior is the middle of Tequila with Allo pivoted to a woman for example, in California, where the Cushing to Shanghai the argument EBIT for that class Ciena men. So l'oreal returns out of the bundle sheet of controlling all of the Statoil for its own gold gotcha.
So the targeting of the cohorts value with a growth hustling hunting Pat Tcl, a woman who is a pending sheet on the tiny goes the tough Wilcox sand island of opinion, she 18 Farquhar control of course.
He won't properly in the synergy on top of sooner of the waves non woman credit contingent of forgot one because I jumped the broker channel for the cohort J&J Coca was launched in the year, we will mature in the <unk>.
One of the two big things really damaging the coccogenic figure back value switching going on for Tom Shimp of book.
For London, whereas the Dabashi sandrock, Who's only hunt, that's a big inflow to do constant for named James who with a full suite of origins as Sue so can't offer the.
The idea and to between three of the losses on highway you got Cushing for why I. Appreciate there's a lot of 20 <unk>. The single so think of the Salon tug of hook I think say.
But the end points and keep in terms of the Diego salary accounts with you from Hello, a question.
At the end who've had one of your current yes, the only between cardiology.
Cash I'm with you into the Intuit she the RMT Tammy could truly meant the way the in San Juan pins on me for all of that somehow from charter Cushing Vouchee Genie won't talk to you talk of what for that job who many of.
Couple of ways launching.
How we cope with Pompe I'll tell you how the X, yes, so jellicoe completing the ECM Gwen the appropriate so she can clearly for a total AT&T, Mexico, Hershey Tau Pogo a year with essentially a flat trading for the heart wrenching Robo assistant for longhorn.
So do you have a finish assortment zone, who shall be who continually the across each of the G tube tolerate a couple of CTO of tenure of the form 10 Hospital you create some of the fifth.
But back of the Goto familiar at the time, you since you're going pushing the Gwen eating the copel with launching the Simpson with each of the eats the garbage in the city for me she thought of a claim going hold on for a total and I think the lads on both had a great value.
Pension cash you've got to have a good to do the should you choose the better.
Last but not like a.
I'd like to briefly Noah has been running businesses in Shanghai for 16 years and being listed for nearly 11 years without our own headquarter buildings in this quarter. We have finally from a satisfying headquarter of premises in the causes of the Hangzhou comprehensive transportation hub to meet the increasing office usage demands of Noah.
More importantly, as a trending Chinese private banking brands in line with the surge of favoring Chinese strength in consumption market over the past few years with pipe, we primarily serve Chinas high net worth and ultra high net worth clients. The new permitted demonstrates an upgrade of our core culture and philosophy on the journey.
From a product driven startup to a century old enterprise of serving three generations of clients.
And the location of the Hangzhou hub enables us to connect with other clients from around China, especially from Jiangsu Zhejiang provinces in Shanghai in a swifter and more convenient way for practice client centric theory, providing us with a client interface with both quality and convenience the.
Genesis is designed by foster and partners. The for them also designed renounced buildings such as Apple's headquarters the Apple Park, the Swiss re building in London, the HSBC craft quarters in Hong Kong and the Beijing Capital International Airport one of the buildings in this project is the only office building with the Altra.
For cylinder in Shanghai with L. E D lettuce, a range throughout after several rounds of adjustments and improvements by Boston partners under the basic sealing the structure. The sit in the body is hollowed out in the middle and the liking of space utilization rates of the building of all to the maximum the.
Project has a total construction area of 72000 square meters and the leasable area is a 63000 square meters. It is located in the core business zone of Hangzhou, Shanghai adjacent to Concho airports and railway station with convenient transportation.
Current centric includes creating the best experience for clients authorizing the phone line managers, who are the closest to clients to make decisions, providing various services meeting clients' needs with various products promoting digital transformation and congratulate realizing intellectual ization through online.
Data and analysis of the basis for us to improve service efficiency and more accurately understand client needs. The rest of the Butte other service ecosystem around their needs.
You may say that the purchase of Noah headquarters is a milestone of Noah second adventure and upgrading the company's new management, a concept of client centric and survival first.
We look forward to a welcoming all shareholders and investors to visit the know Noah share headquarters.
Next that invite our CFO is the pension to introduce the quarterly data in detail. Thank you Andrew.
Thank you, Sir ladies and the claim.
The investors and analysts good morning.
Very excited to share with the another record setting quarter in which we have accomplished new highs across various financial and operational metrics.
<unk> revenues profit client activities transaction value and a.
Our a M retention rate as a client investment passion and confidence in the economic outlook continues recovering and over a T. Morale continues growing benefiting from the implementation of various new organizational improvements and the upgraded client service model as part of overall strategic transformation.
So far.
I'm also happy to share with you that we were ahead of the schedule to meet the full year non-GAAP net income guidance of.
RMB one two to one 3 billion as we concluded this quarter with a record high of non-GAAP net income of RMB $461 9 million.
Mainly due to also rig or a high performance based income of RMB 400 over the $3 1 million a company with growth across other revenue segments.
Now please let me walk you through a more detailed results of the first quarter.
We recorded net revenues of RMB, one 2 billion, which was unprecedented for a single quarter. Since listing. This was mainly contributed by a performance based income of RMB 403 from 1 million also a record high a result of the strong performances of the public securities products, we have placed for a clients in the past.
Accounting for over 60% of the total performance based income during the quarter.
Just to give you a rough idea of what this means for our clients for every million of performance based income we earn based on average sharing with the GPS our clients would have made RMB 20 million of investment return above the hurdle rate of the return after accounting for the performance based fee charged by the GP.
One time commissions in the first quarter was RMB $323 2 million up 53, 2% year over year, a 19% quarter over quarter, driven by strong transaction value during the quarter, while maintaining a very healthy fee rate of one 2% on the products we place for our clients.
This demonstrated a successful efforts in the optimization of product mix.
Recurring service fee was RMB $474 9 million up five 6% year over year and $8 nine.
Quarter over quarter as we harvest on the recovery of a transaction value of place for a client.
As Jeremy has mentioned one of our strategic objectives for 2021 to achieve core going growth, especially in the tier of Diamond and Black card clients were happy to see the number of Black card clients has grown 12, 7% year over year to 992.
I have also recorded unparalleled client activities as close to 28000 active clients up 65, 4% year over year, and a 42, 8% quarter over quarter.
The number of active conventional clients was 6300 also up 54, 6% year over year close to 20% quarter over quarter.
The robust client activity is a clear indication of the successful implementation of several of our key strategic initiatives, including the Noah Triangle service model, which helps our items utilize their full client engagement potentials.
A product experts.
During the first quarter, a record setting close to 600 of our items for qualified.
Elite items of 68% from the previous quarter and we have managed to keep our most valuable sales force intact with a record low elite arm to override of only zero point of 28%.
As a result total transaction value was RMB $27 1 billion during the quarter up 16, 8% year over year of 27 per 1% quarter over quarter.
We placed an unmatched level of RMB $21 5 billion of public market products for our clients kind of.
Assisting of RMB 11, 2 billion of private hedge funds, which doubled from previous quarter and RMB 10 billion of mutual fund products also increased 21, 8% quarter over quarter. So for private equity products. The total transaction value was RMB four eight.
Volume of 62 for 5% increase year over year, a seven 9% decrease quarter over quarter.
Operating income was RMB 500.
$2 4 million during the quarter up from 96% year over year, and almost 50% a quarter over quarter. The operating margin was 41% an improvement from $35 two from the previous quarter.
Comp related expenses were RMB, $582 1 million up close to 60% of year over year, and 30% quarter over quarter, a reflection of the increasing efforts in a recruiting new accounts.
Non-GAAP net income was RMB $461 9 million also a historical high.
Just for the purpose of getting a sense at a normalized number adjusting of the carry to the same level as last quarter. We would still have recorded a 41% year over year growth of <unk>.
38% quarter over quarter growth for non-GAAP net income.
As for a segmented results net route.
Revenues from wealth management segment was RMB $946 5 million up 71, 3% year over year, the 47% quarter over quarter accounting for 77 per cent of total net revenues for the quarter.
The strong results wealth business segment was driven by a robust client transaction activities.
Painting, a high overall fee rate net revenues from asset management segment was RMB 270 million up 63%.
Year over year, and down 11, 8% quarter over quarter.
Total U M has grown 8% since the end of last year to RMB $154 1 billion, mostly driven by growth in private equity and public security products with the effect of exiting of credit products.
So moving onto your balance sheet, we remained healthy liquidity position of the current ratio stood at three two times debt to asset ratio was 24 eight per cent and continue to have no interest bearing debt on a book.
By the end of the first quarter, we had RMB close to five day cash we're on track to deploy the budgeted spending with relation to R&D investments and other growth initiatives.
As mentioned by Charlie the one we have entered into definitive agreements to acquire a class a office prop per.
For our office property located in the Shanghai, a phone Charles Central business District, with a gross floor area of 73000 square meters and a gross leasable area of 63000 square meters. The <unk>.
Total consideration is approximately RMB, two 2 billion, which is equivalent to RMB 35000 per square meter based on the jeopardy.
And that's a good deal when compared to the average of RMB 40 to 50000 a.
Trading price of a Jason comparable properties in the area in the past few years.
We plan to finance the transaction with cash on balance sheet, but it will also look for opportunities to refinance when the cost of financing and timing is right. This.
This is the first time in Noah history have her own headquarter that will be able to support the growth of our business and the need for additional office space in the next five to six years in Shanghai.
And because of its close proximity to one of the nation's busiest transportation hub the.
The facility is also an ideal premise to house various climate conferences for the Yangtze River Delta region, including Shanghai, a Zhejiang and Jiangsu provinces, which is our most important geography segment and a total contributes to more than half of our business. The deal is expected to close within.
The next couple of months upon the satisfaction of further closing conditions and government approvals.
Yes.
Moreover, I would like to note that we have published a seventh ESG report for the year 2020.
Aligning a long term commitment to ESG, a responsible investments and it's available on the ESG section of our website.
Overall, we're very pleased with our first quarter results and the strong growth in client activities as well as in the key sales force.
It's a hosted our annual <unk> conference in March and received very nice attendance that is showing that our clients are still very eager to learn about the overseas asset allocation as well as the insurance products.
With our business outlook as we will continue to improve of.
The client service experience of optimize a product offerings.
Thank you everyone and I will now open the floor for questions operator.
Thank you.
We'll now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone.
A few and using a speakerphone please pick up the handset before pressing the keys to withdraw your question. Please.
Please press Star then zero at this time, we will pause momentarily to assemble a wash Russia.
Yeah.
Your first question comes from as you with Bank of America. Please go ahead.
Hello.
A quick one.
For example.
Yeah.
No call or what's now range I wish it wasn't like that a semi.
Yeah.
Can you hold a female sounds of how's the huge Wang non-GAAP net.
Non-GAAP of bad down there.
So the other media.
Oh, well class you yeah a box.
Got you a cool Oh.
Paypal for them, but you do.
He is a non-GAAP net income.
Without a true roughly flat because the book.
The loss of warms up.
Hum.
<unk> got plenty for them, we can do.
Our non-GAAP.
No no.
L a or a phone call.
A congratulations Oh, no I saw a though.
The good fourth quarter of the doubts about my question made a why don't you only buy a chemo a non-GAAP net income guidance for that for years.
Todd a according to the current guidance it seems that the implied.
The implied for the well.
The quarters yeah.
One of them.
Without a declines of two 2% year on year. So a whatsapp can hold you back for all the volume up to that.
The non-GAAP net income for banking.
Thank you.
Okay. Thank you and that's a very fair question a.
First of all of obviously very happy to see the results in the first quarter, but at the same time, we're also conscious about the volatility, especially in the Asia market in China.
For the outlook of the rest of the year. So for that a you know as much where confidence with a.
Our topline was still a pretty I guess, it will be pretty reasonably a.
Conservatives in terms for the expectation of the Super of over performance for the rest of the year for the market, which obviously will impact on the transaction values of clients' investment passion and two as we have mentioned and we'll continue to invest a your strategic initiatives.
Especially in this year, it's a very critical year to open up our transformation and some of the investments actually are in talents and some of the marine technology.
So the full year impact has not shown in the first quarter and a expense we expect that the investment continued to ramp up for the rest of the year. So.
From that standpoint, we're pretty confident offline growth.
But at the same time, a one also makes sure that would have enough room for the investment in a strategic initiatives.
The one woman theater was so it was on the heels, finishing the now of a mail phone clogging of the lever in the movie on the or would you have a screaming pay kind of all of them in such a quote you. The GBT do they don't be in gold of course, and don't hesitate on a flip on total take a quantity of that Houston, well shuang deploy on a go.
Congo, Chile, you got punished in the Gulf of against when you're going to go to the Ludington. The animal so what wasn't James a ticketing for to be stopped being a good okay, who you're going to need the to impose all of them have a show on the go there'll be a door.
In terms of a difficult gamma.
So generally the has also a supplement it you know in the.
The last few quarters, when we're going through our transformation and strategy, especially.
Upgrade a management and also organizational capabilities, we're trying to transform a from a so called a startup company.
<unk>, a really mid low mid mid sized level type of a you know.
A modern corporation and organization, which actually requires heavier investments on the management and organizational resources.
Okay.
Uh Huh, that's a kind of guidance.
Yeah, Oh, what sounds like Jenny Wang.
She has a job one.
Some of them being paid.
I think the Dodge and Quad, the Ohio, <unk> pieces of Shaw and bags of blood type of guar.
Ah, yes, the Baghdad doctrines all of them.
Oh gosh the camera all of her daughter Yamaha a.
Thank you.
You're thinking of maybe probably a quite young you tease out somebody else, you'll get that type of a bunny back why do you see the at that type of a pad you're glad that class I hope it's about one simple goal.
The handout.
Hum a bulk commodities.
For me there.
Zone alcohol, a down a little a harbinger of yeah, when they began to get the idea.
Do you think Oh.
Oh, Thank you so much a part of.
Of Oh, I'm certainly my a previous question and I have a follow actually twofold. The op question a could you. Please a introduce.
Each of abuse, while making the progress in the second quarter, a including the major of Disney's Magic and I and I'm sorry for the a many domestic Chinese banks are paying more attention from the wealth management sector. Because this is a very promising sector.
So a do you sales are increasing competition well.
Of the Chinese banks and how they all of your response for that thank you.
Yeah.
Good for what do you the.
A woman for each day, you go golf routines on this the top.
The legging hung Chen Tong Highway you cannot do the onto the Trafalgar animals now Kochi of junior in the high uhm to occur for a greater sizzle from a share.
According to the the to go by.
I can't quite a bit of Wow.
Well a machine I realize you throw the mandate the tenure.
The hurting huh.
Do you mean, a lot has gone into the sooner and so glad woman Ingersoll true auditing the non paper.
Rob will further enhance the Montgomery has she don't cause the attempt.
Tempting shoot on the task of getting that one the way I'd feel a shy to do the Angeles the lunch and the to go you come away from seeing some solid share a simpson the chief a backhaul turnkey Iot tasks of XI page like a gene.
So for shelter for the quote underneath the B D day Duncan that notice of a mental but then it won't be a fishing she is asking for that country of the loser.
So to address the second question first the Irma that Tom as you know, we're always in a very highly competitive market a.
And because it seems to the the transformation of all of the shift really in the regulatory and policy environment seems we're facing a more and more security brokerage firms as well as backs in this particular market space.
But from a standpoint, Noah has already moved onto the stage 2.0 on in terms of wealth management industry. The a it seemed the other banks of all.
Just starting a their stage in terms of design of the right product from product driven type of strategy. Meanwhile, commitments from a well Noah has moved onto really trying our best to match, our clients' needs with the right products and services as well as you know the.
Agents and sales network that serve them. So we're really.
Moving onto the right direction and moving into the right stage, obviously initial part will be tough and difficult, but we're very confident there we're actually working on the right track what was that gives the Shanghai show you. Some of the weighted share just a woman the b <unk>, Jim going onto a <unk> got with the gym branches for the golf.
For the onshore well most of that <expletive>, the sanction cohort from Chicago Uhm in a country. The to go soon it does take a while.
But that is a higher women can value genetics of warming up for unethical warm in the fund Shih-tzu a woman. So you go but then a bunch of cohorts at all so youll cohort of Houghton 90 cohort the only thing of how amongst the eco chip and some coolidge a sum of job for a host of the city of Buffalo for the 10 team get a host of the cocoa Luca you did have a feature validate how mosquito Sean actually book.
What do you think that's a good she's the granting of those two pharma machine that the figure in Hong how would you even do for kind of the message that wasn't a country to lose a book or Youre a handoff.
Somehow kind of more of a one of them courtship.
The Tennessee, you got to find out that what months, you're starting a fact, finding the of Alejandro a balance.
So for the woman population, particularly for the intelligent.
Or do you think of course as of late.
Maybe you go towards half of granting who does the guidance you go do not me of data.
Yes, so true out of the more color onto that a especially to elaborate what we mean about.
Bottom line is for a commercial survival or a commercial success is that we always try to ensure that we have a higher standard in terms of compliance than what the regulators have put on put out for the industry. For example were being very selective in terms of the final acceptance.
Screening of the.
For the clients profiles in the West we will take on some clients of at the same time, we will give up on some clients just want to make sure that we are always a.
Try our best to place the right products for the right clients of the right place, but it seems that our competitors aren't you know as the new a rising competitors you mentioned the EM.
He is still trying to copy you probably are older.
Of the compensation scheme for example, and their sales force a well we have actually moved on several generations of several upgrades on the compensation schemes for the a sales force.
So we believe that you know we're ahead of the curve.
But I wanted to make sure of also we understand it.
Initial stab at the initial part will be tough for already for the challenge.
And a.
To your first question in terms of the operational a.
Situation for the second quarter, you know, obviously I can tell you too much of other numbers will continue to market a.
Go for has a a target with some products, which has met with a pretty good acceptance as part of the clients were pretty confident the the numbers will show up in the first quarter or in the second quarter.
Also we continue to host a.
Actually the total.
Smaller conferences in Macau for the overseas insurance products, and a I'm pretty happy to see the results, especially the positive results on the top line and the profit.
Yeah.
How does your share.
After the Irma.
[noise]. Thank you once again, if you wish to ask a question. Please press star one.
Okay.
This concludes our question and answer session I would like to turn the conference back to Mr. Payne for closing remarks.
Although she didnt go away for stroke and finishes for if all of them of course of your umbrella.
I'll turn the conference back a reward a production day the ones you won't create bad debt.
One of the Portland, I'm a free trial.
Once you go into some of the tissue heart tissue that gossip.
Okay.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
[music].
Okay.
[music].
Yeah.
Hum.
Mhm.
[music].
Okay.
Okay.
[music].
Okay.
[music].
Yes.
Yeah.
Yeah.
[music].
Uh huh.
[music].
Mhm.
[music].
Yeah.
[music].
Hmm.
[music].
Okay.
[music].
Yeah.
[music].
Yeah.
[music].
Okay.
[music].
Okay.
[music].
Okay.
Okay.
Okay.
[music].
Sure.
[music].
Okay.
Yes.
Yes.
Yes.
[music].
Yeah.
[music].
Okay.
[music].
Hum.
[music].
Mhm.
[music].
Yeah.
[music].
[music].
Yeah.
[music].
Okay.
Yeah.
[music].
Hum.
[music].
Hum.
[music].
Yeah.
Yeah.
[music].
[music].
Okay.
Yeah.
[music].
Yeah.
Yeah.
Okay.
Yeah.
Yeah.
Okay.
Yeah.
Yes.
Okay.
Okay.
Okay.
Okay.
Okay.
[music].
Yes.
Okay.
[music].
Hmm.
[music].
Okay.
[music].
Okay.
[music].