Q1 2021 OneConnect Financial Technology Co Ltd Earnings Call

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Good day and thank you for responding by welcome to the one connect first quarter 'twenty to 'twenty. One results conference call. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session and to ask the question. During the session you will need to press.

One on your telephone if you require any further assistance. Please press star Zero I would now like to hand, the conference over to your speaker of today Speaker of Patricia Cheng. Please go ahead.

Hello, everyone. Good to speak to you again welcome to the Q1 earnings call on the line, we've got Mr. Nagy lunch, when chairman and CEO of one connect.

Mr avoiding the Cao CFO.

Michael Xie CEO of SME banking and commitment of tissue Wang CEO of gamma.

Some housekeeping of people. We begin first of all you can download the earnings press release and presentation from the IR website.

Our remarks today will include forward looking statements, which involve a number of risks and uncertainties that could cause actual results to differ materially.

The forward looking statements that we make all of this call are based on assumptions as of today and we undertake no obligation to update these statements except as required under applicable law.

During the call when the percent those kinds of RF and no either at the financial measures.

A discussion of the limitations of non smashes and then the conciliation to INR is concluded in the earnings press release.

I will now pass the OLED Chairman Yeung his remarks will be in Chinese translations of English will follow.

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Hello, everyone I am pleased to say that it won't come of that has got off to a solid as dawn to the year driving the cost per hour of the economic recovery in China as well as the continuing demand for digital solutions from our financial institution.

We achieved revenue growth of 41, 1% year over year as we build on the momentum from the rollout of cloud services platform last year, which more than offset the GAAP from the exit of low capex.

Even though the drop in business origination widen the following industry and the regulatory headwinds revenue mix from third party customers rebounded for two consecutive quarters.

These will be key.

Since we'll be freed up from the 1000 tons of employee since you're taking some of the liquid.

The increase.

The increase of the <unk> sciences for the above index.

Total product to better for you.

Each of them.

The global mobile line on a cohort.

Some good projects total, Utah clearly from the medium <unk>.

Moving to Tianjin <unk> yield on the DTC growth meaningfully enhance EMEA for the fourth line.

We encourage the barbell changing the full bringing home for.

Both of them together.

The only the affluent.

Net loss of also further improved with net loss ratio of narrowing the price of 34 percentage point strength through the strengthening of product management and the continuous cost discipline.

Further progress was made in customer expansion in the first quarter, we signed over 20 deals for the.

Worth more than $5 million, yet three of which exceeded the 10 million net the contract size is significantly higher than average from the <unk>.

The financial institutions issuing a total of digitalization of retail banking business for <unk>.

The <unk> of digital bank from scratch. This project reflects our all around the coverage of our clients' diverse kind of are of Great Testament of our technology plus business.

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Logical gains on the strong semi.

Cct's.

Adjusted.

And the lead to even come to the synergies.

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These impacts of the important gains in the Delta.

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For the use of Industriebank corporate synergies.

And the total lesion.

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Sorry, the quantity of Jabara, who will jump was also strong cash flow.

Houston cohort because of these up.

So coming quarter welcome that remains committed to strengthening product the value as well as the customer value. We will continue to upgrade our products and the enhance the end to end for me improved for the core competitiveness of our operating.

While non mature product, we will further broaden the customer reach and the volume for newly launched once we will step up sales to third party customers.

Same time of we also need to deepen the engagement with our customers.

For the financial institutions have different needs.

Selling and up selling we will improve the wallet share as well as customer value.

So all of whaler <unk> been working the efficiency for the profit and so.

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Lastly, I would like to reiterate our confidence that as the Chinese economy and returned to long hour. After the pandemic the revenue growth range.

No I'd ask that the last year, we also expect to get double digit percentage points improvement in the net loss ratio.

Thank you again for your interest in and support for on connect your comment and the crush strength will be welcome as always.

Hitting at the thank you Kevin.

The next CFO Northern Cal will go through the financial results in more detail North of book.

Yes. Thank.

Thank you for Patricia good morning, everyone.

This is my first results briefing.

Owner to speak to the present our results.

The first quarter of Jeremy you said in his opening speech was the period of consolidation.

The one which we continue with our strategy to reinforce products and the sales.

Starting with the top line.

Revenue increased by 41, 1% year over year to $820 million in the first quarter.

The resumption of activities provide a good snapshot of our business.

Our revenue is driven by transactions for usage of our solutions.

There are three main indicators that we look at.

The retail loan volume SME loan volume and auto claims.

Video loan process by our system rose, 11% year to year to 14 billion.

The reversing from a drop in previous quarters.

Thanks to a pickup in the this commencement of solutions, which I'm going to talk about in the pit.

SME loans processed also posted an increase of.

Up by 25% to 17.

The number of auto claims processed rose, 56% to $1 $5 6 million.

You have all seen the impressive the GDP growth China reported in the first quarter.

Though the situation surrounding COVID-19 remains fluid on the there are some of the Thomas.

In different sectors.

The recovery of the domestic economy is generally annually.

The improvements in transaction activities, we will further drive our business.

By business segment the.

Cloud services platform was the biggest driver of revenues.

Contributing $181 million.

Or 22% over the total churn over the total revenue generated.

The business was launched at the end of the second quarter last year.

Which means that we are unable to make a year over year continuation of usage.

Our rapid growth shows <unk> ability to break into new markets.

The slide five years ago, when we established the company.

In terms of the science operations support was the biggest.

Revenue rose, 21% to $212 million.

Representing 26% over the total.

Growth side of the assistance of customer service.

Continue to see strong demand from financial institutions.

This can management also did well.

Moving 21% to 90 non Mimi.

We are solely in the earlier slide.

The rebound in retail lending activities.

Plus claims also of falls under this category.

Nonetheless revenues from business origination continued to remain weak.

Bill of 34% year over year to $118 million.

As we explained on previous earnings calls for.

The combination of internal and external factors have been weighing on this segment.

Internally as the intensity of product optimization with the stepped up in the middle of last year.

The residual pressure from the exit we received.

The first half of this year.

Externally.

There has been tightening the regulation and the industry changes towards the end of last year.

The impact is also evident in the performance of our customer groups.

All three customer groups Piedmont, the effects and the third party customers.

For a drop in business of origination revenues.

Revenue from the <unk> fell one 9% to $75 million as a result.

The team is working hard to make up for the loss over the course of this year.

With respect to peer group.

Revenue rose 92%.

Year to year two of $436 million.

The expense into cloud services platform provides strong support.

More than offsetting the drop in business of origination.

In terms of third party customers. This group did experience a bigger decline in business origination revenue.

The cost that was our first of the business line.

End of the third party of accretion since the highest for our more mature solutions.

Despite having a bigger hole for Hugh.

Third party customers delivered 14% revenue growth.

In the first quarter.

Aside from the business origination all other segments achieved an increase year over year.

While the business originations do undergoing consolidation, we are seeing signs of recovery.

The 14% growth rate is higher than the level of steam in the third and the fourth quarter last year.

Sequentially. The portion of the third party revenue has been rebounding from 34% in third quarter last year two of <unk> 36 in the fourth quarter and are now for the eight.

Given the timing of ultra product <unk> and the new product launches, thus the skew year over year numbers the quarter on quarter trend is a better indication of the progress made.

This is the same with gross margin.

Year over year, the metric from $34, 8% to 34%.

You'll have to take into consideration of the change in mix of solutions.

Quarter on quarter on a non <unk> basis.

Gross margins rose from.

42, 8% in fourth quarter of 2020.

True 43, 5% in the first quarter this year.

Next I would like to discuss operating expense.

The three main expense items, who reported a drop in Rishi.

The kind of number one.

Research and development expenses rose, 17% to 200 for PD one minute.

The growth of cloud services platform does require more investment.

As a percentage of revenue the ratio was lower year over year from 41% to 34%.

We also spend more in sales and the marketing about a 7% the highest year over year of true $167 million.

As the resources got elected to promotion of new solutions.

However.

As a percentage of revenue the ratio went down from 27% to 20%.

In terms of the general.

<unk> expenses.

We cut spending by over 6% year over year to 100.

As a.

Turning to revenue the ratio dropped from 33% to 22%.

Representing an improvement and.

Number of 11 percentage points.

The scale that we're building and the lead to.

And the amount of operating leverage.

I didn't mean cost of discipline.

Operating loss ratio improved from 77% to 42% of.

Drop of of close to 35 percentage points.

The bottom line wholesale made of similar progress.

Net loss to shareholders fell to 300 of 5 million from 415.

As a percentage of revenue net loss ratio improved by 34 percentage points to.

37, 2% for the full.

Quarter.

Overall, we're pleased to have had a solid first quarter.

It is important to continue to innovate and the gorilla diversified revenue mix.

The <unk> the changing needs of financial institutions in.

In this evolving market.

I will now hand, it over to Michael we will talk about of the progress.

Sales efforts.

Thank you hi, everyone.

You have the presentation in front of half year actually we have a second section talking in parts of the payments highlights.

We have several case examples of our product and our current case examples.

I will go through one by one together with you.

The first of what our major drive for our revenue this quarter with cloud service platform.

Our accounts is that true desired specificity to cater to the needs of financial institution.

Security safety and the combined are the most important consideration for financial institutions.

And also of the key differentiating factor for our financial products and services.

All of it's page you can see the car T. For example is that joins the OPEC.

5% of the test the environment at the 30% of the production environment at all of our downtown.

Net result, the bank is able to deliver result, much faster.

With more flexibility.

And also at a much of our cost.

We had several successful the profit client findings oncology services since the beginning of the year.

That's the page is a great example for another choice about bank.

We have implemented of corporate banking risk of control platform for that bank of coverage of a solid debt of at corporate corporate banking customers.

And all of a 70% of ex corporate loan portfolio.

We have for the bank consolidator over 20 types of various internal and external data to develop API product labels.

We also offer of motto platform and the new engines.

We have the bank developed over 600 early warning signals every one of the rules.

Many of these rules.

Our understanding of the business.

This is a testimonial of our business and the technology because of affinity.

The bank is now using this platform and its the whole credit process.

From preventing customer profile.

The risk of waiting.

The political environment or even traction.

We are actively replicating this product to other banks in China.

The sort of case is for a leading set the commercial banks.

Our mandate is to carry out for the digitalization of the retail banking business.

We started with the smart banking consultancy services, we need to further understand the the existing business with the bank of <unk>.

And then how free design a solution that can achieve those objectives.

Two of the products that have been kicked up for it so far.

The mobile banking application and the operations Middle office.

Two of the application and the middle back with.

We have the bank credit that into a platform for the whole retail banking workforce.

They can run their operations manager of our workflows conduct the various customer analysis the poor.

Right half kind of feedback share various had the insight etcetera etcetera.

The platform now supports over 6000 of relationship managers.

And the eight Middle Office Center.

Similarly, the product is being rolled out two of multiple other clients.

The last example, yes, you can see here is to build a brand new bank.

The our full year results, we shared a similar classes for example.

We have the digital bank in our book.

Putting all of our capabilities in one bundle.

This is not the first time debt won't connect with interest at the with a mission to build a digital bank.

But the digital back from scratch.

At this time because of the mandate from the different country.

This particular, one is the countries for the full digital bank.

And the comprises the digital mobile banking application of core banking system, which will power. The features such as remote banking services the wrong derivatives of opening.

Part of it.

Our customer service etcetera.

Many of the functions have already been launched.

Such as the real time QR code the payment, which was the first in the country.

As well as during the COVID-19, the <unk>.

Back to use of our system of tools to deliver digital digital disbursement of the relief subsidies.

To all of the citizens in the country.

As a simple Swiss back online account opening process.

I hope these product at the cockpit. Examples can provide you with a better sense of our business and the impact we have had every telecom.

Our past back to Patricia.

Thank you Michael operator, we are ready for questions can you. Please open the line.

Thank you for your centers as a reminder to ask the question Youll need the press star one on your telephone again from power one on your telephone until we draw your question for US the pound key please standby, while we compile the Q&A roster.

Our first question comes from the line of Jan you with Morgan Stanley. Your line is open.

Thank you for the opportunity of production on the congratulations on the strong top line growth.

I have two questions here first one is on gross margin because we saw meaningful business mix change no matter from.

I'm sure <unk> perspective.

We see the business of origination part and the.

The low margin implementation part of decrease.

But.

The gross margin of steel.

Lots of flattish from could you please update us.

Whats your line of progress so far.

I think of the companies cutting from low margin business.

So the vehicle so far.

And the especially.

The cloud platform is growing super fast.

Is that for you.

Got it the low margin business at the current stage.

For the second question is related with OPEC, we feel very solid all back to control this quarter of only 7%.

Chris.

Sure.

So for management of thinking of that as the new normal or talking to stimulate growth for the full year or as you've kind of off of work.

From a range of thank you.

Thank you Mary Anne.

CFO of northern Count, it's going to take out both of your questions.

The only thing okay.

Thank you for the question I think.

Okay.

Because they are related.

The gross margin, yes from.

Youtube searches for <unk> 30 for.

Percentage of user.

The.

The about.

Two eight per cent.

But the.

For the year.

The year basis is the result of the.

Mix of our.

Our business just as you said.

We launched of the product optimization.

In 2019 under the.

The intensity of last year.

Debt to the.

One of the impact is gradually we will receive.

The Q1 last year.

The major change is the cloud for option because in last year, we didn't have the.

Cloud business service.

This year, the cloud approach and use of 22% over the total revenue.

For the cloud services platform as the new launches.

In the early stage the gross margin cannot be the.

Nope you've already.

Contribute too much to improve the.

The metrics.

Actually I think it's better to.

Look at this metric.

Okay.

So this year the.

Right.

It's one of the business.

Is it similar or comparable because in Q4 of the cloud.

But the closer as the platform is as opposed to 18% and of the.

And this series of 22%.

From Q4 to Q1 the.

On the Srs business.

This is.

34, 2% to.

34%.

So I would say it's pretty.

The same level.

But.

There is also another consideration.

Cause us because of the.

Gross margin.

Of the numerator.

Yes.

Yes.

On the day.

Non made or the.

The revenue.

Have some of the seasonality in Q4 is much higher than Q1.

From the number we can see it flow to 30% of higher than the <unk>.

Then the than the Q1 numbers. So if we excluding this impact.

We better look how did the non FRS basis. So that's why on line.

Our slide we compare the.

The quarter to quarter variation based on the MSR spaces is the from $42 H two.

The three points of ongoing move our production.

The gross margin.

The improvement in the new launches.

The improvement of the gross margin.

Scott.

Total.

The third okay.

The third one.

Can you repeat the question please.

Of.

And the question is.

We see the Opex.

For and the marketing R&D.

Credit Suisse.

With just the single digit the first quarter, what do you think is that true.

Kind of growth is sustainable or is there any.

Well, if we turn to lead to relatively good cost control in the first quarter.

Yes for the operating expense is more.

More and more of.

The revenue the.

The scale, we are building actually will lead to the operating leverage we will see the operating expenses will go down further actually lower and lower.

Yeah.

Yes. Thank you.

Quick follow up.

For a quick follow up.

I think of the.

As you mentioned to use for now.

For us a metric.

The gross margin and also mentioned above.

The good cough.

Of course.

Change too.

Jim policy.

Yes.

Yeah.

No no no.

I don't have any changes on this policy.

Thank you. Thank you.

Sure.

Yes, actually I want to also provided.

Can you just managing the other on the margin you.

You have pointed out and also Mr wise that we faced outside.

In the <unk>.

Past two years for in the meantime, we also launched the many new product.

Just the one example, as we have explained in today's briefing.

Chicago, We also have the risk.

Couple of risk of banking risk of vacuum of platform. The retail banking also the total back in you have box. These are all many of the many of them are actually of new products. We have launched after our IPO.

At this stage a lot of the standardization of work is required.

So thats the market tend to beat all of our holdings of new product, but as we build the more contact take the examples at the cost of oil go down at the margin will gradually improve so I think that also is one reason why you'll see our margin.

The relatively stable.

Thank you.

Thank you the OEM operator, we can go to the next question.

Your next question.

Oh with Keybanc Your line is open.

Thank you for taking my current chain.

So good morning management team so for.

<unk>.

First of all.

Yeah.

So you can look at.

For our retail loans.

The business the origination revenue.

We have been willing to go into some optimization of our product portfolio.

We actually see.

Okay.

We saw a decline in the retail along the year over year and now.

And then we have the feed the declining business.

The generation revenue net gains to be directionality.

<unk> and <unk>.

We have seen growth in retail loans, while the Hep C.

While our sales declining.

Speaking of the imaging revenue.

So I was just wondering now how do we reconcile.

The trend underlying and then the last macro question and then second question Jess.

So net now cloud revenue.

Johnny I would call revenue is from Pn customer.

And then if I ex subtract the call revenue from our revenue from PM Group net.

The same fact growth.

While locking.

<unk> low teens year over year, and inbound for nearly 40% sequentially and the things that are larger than before and then consider everything we have.

The lower base for.

For our first quarter last year. So just wondering is there any color you can provide to have the.

Good day.

The dynamic in the Q1 for.

For our <unk> growth.

The single customer.

And that is taking the question and the question is.

Volume out of that last time, we have Paul.

While the outlook for the for year.

To be.

All of that and then lastly of which would be 42% year over year growth. So.

And now we have for Q1, we have slightly lower which or the.

The 41%.

We continue to.

To maintain our guidance for revenue outlook for this year, 42% and if so why.

Yes, it would imply growth yes.

That ratio and you afterwards.

And then what will be the driver for that thank you.

Thank you.

The three questions the first.

The first one net.

All of them.

I will take the first one and.

It wasn't going to take the second and third one I think.

Okay.

Thank you.

Hi, Yeah very good question.

The growth in retail loan volume effects of that dropping our nation's revenue.

So the answer is actually quite simple is that because we have we have a shift in the loan portfolio.

Yes.

So Patrick before 2019, and many of the loans that we serve are those the.

The consumer lending without any cash flow security for.

The margins tend to be much higher for these type of travel services.

Now I think of our portfolio has been shifting two of those more collateralized debt.

Debt at the mortgages, the hottest et cetera.

The net income net net interest margin for these products Esa of bunch of Iowa for catalyst.

As the Macquarie debt and Thats also of our service fee.

As much of our so that day.

Why are we have the growth in the volume by net.

Hi, Matt drop in the revenue.

Okay.

On the second question.

The.

The in the first quarter of the main driver is coming from the cloud services platform.

But Steve we both of the cloud.

Other big.

Business growth is about.

The team percentage.

But I think for <unk> and we wish you the looked at as a whole customer because.

The business coming from one single customer.

The.

We have some of it will have some agreement.

Between the one connected and peanuts.

Sure.

Also for <unk> there is.

The impact from the.

From the product optimization for the business of the region origination line.

Because we have also business with with the piano for.

For the into this line of business line.

The.

Actually.

EBIT, excluding the cloud the other segments.

Besides from aside from the business of Indonesian users still.

That is more than offsetting the decline in the business the origination.

And also.

<unk>.

I think.

Okay.

For the.

For the Ping an.

With the with the improvements in the business of recognition I think the day.

The income the growth will be coming back actually for.

<unk>.

Maintaining the similar.

The pace.

Yes, just to just to add onto the <unk> question I think and.

We wish to treat the P&L at the same as the other other kind of.

So we actually strip out of the crowd, because we launched new product for <unk> also with phase outs of out.

The product so I would suggest we look at the peanuts revenue as a whole cash.

This debt of one of the new products, we provide the true P&L group, there's the other bunch of a new product we provide the PM group too yeah. So we just the trigger for us as a whole we have of new products and we faced at the other products and we are confident.

Our all of our services was P&I, while the long term will continue to grow our support of the PR group.

Correct.

So we have the.

Yes.

Went out of new product in our pay for oil product so the rationale behind the.

The phase out.

Most of the low margin low value just adds.

As we have seen in the overall the business, though the imaging segment right.

Yes.

The efficacy that okay. Okay. Okay.

The.

On the on the third question of zinc.

Yes in the Q1.

The increases of about 41%, but.

Looking for looking for the for the full year actually yes.

Okay.

Yes, I think the.

We will continue our.

The optimization on the wheel hub.

For has more efforts in the sales. So we are confident debt for the full year.

Our revenue growth will be will be more than last year's great.

Yes.

Thank you.

Okay, Okay can I infer from that.

Thank you Kim.

Of course.

Oh, yes, yes, yes. So the next please go ahead.

Thank you. Thank you just wanted to ask about.

Of the implication from.

Moving.

The launch of the digital current street.

By the Central Bank and.

Because I think.

For PDC.

Two of attacks that type of model.

The traditional centralized database for carriers.

Decentralized nature of technology, and so I just wanted to know.

Is there any.

<unk>.

Or is that the rationale for the commercial bank debt.

They may adopt the debt.

<unk>.

I mean as opposed to the current legacy the infrastructure.

And.

Is that accounting net.

And we can benefit from the trend.

Just wanted to hear.

And any color for barrel.

The other implications from the digital renminbi.

The helpful.

Okay. Thank you Michael is going to share his thoughts.

Thanks, Kent and we actually are very closely monitoring the situation.

We maintain a very close interaction with the with the central bank to understand of the progress at the current.

Do we see as the most of this of the pick for the Big one.

The pilot digital new currency, we are monitoring of situations you see Wan and there'll be a lot of scale rollout of this the digital currency application and the West I think it is there kind of a road of ops. The largest scale density and there'll be a lot of the refinement from those that those span.

And at the also the marchand to upgrade their payment of infrastructure.

Okay. So thank you.

Okay. Okay. Thank you.

Yes, we can continue you offline on that topic operator, let's have the next day question.

The next question comes from the line of even Wang with CLSA. Your line is open.

Hello momentum from Q2.

Relaxation and tangible book with bank of nicely two examples of the cloud service impact Chockfull of just.

One of more color on the cloud services.

And then can you share of the talents.

Of the revenue storms frontline group versus the.

Parties, we believe.

<unk> Bank group of accounts for the majority of that can we get maybe of some numbers on that and added smart question and a set.

The question.

We understand that one can that sort.

The financial institutions, but the net.

In the plan.

The actually.

That's true still of the government such losses there in options here. Thank you.

Yes.

Thank you Ethan.

Can we ask our ship items PK piece the in charge of the cloud business to talk about our cloud strategy to give you some better idea and then the second question about the government debt.

Michael I will take it.

Okay.

Sales in July.

The current therapy, the linear zero of menus for Chilean peso elements of.

In the room.

So the acetyl.

Looking at the HELOC hasn't elements and the other <unk>.

For the level of Copel to the society.

Good day.

The project is in Shanghai.

<unk> London for coupon the.

So a loser.

So I'm curious how the <unk> targeted therapy to the women.

The chamber of shifts of the total.

Losses.

For the so <unk> changed the life and it was total shortly.

For the attendees on that kind of left for.

On the <unk> side.

Thank you I would like to firstly at the annual for first question last year. When we launched the accounts only for the platform most of our customized outbound pm growth. However.

First quarter this year will flow.

We are adding more and more third party customers, including financial holding company and joins coming and the financial companies at the provincial level for the.

The financial company deals that we signed most of them are.

The over $10 million, yet so we are cognizant of cash.

The number well with the cash that RPM growth.

Yes.

And the second question about selling the government.

Yes, we do serve government agencies.

But we are very topic, we're very targeted.

We actually see government as a part of the ecosystem of us to providing financial technology services to the banks and the Internet companies I will give you. One example.

For the year vouch for the SME financing platform together with the Lockdown provincial governments.

The platform integrated over 200 of different the data sources from various kind of make a comment.

And we use this data we use this information to back the two paired with the credit profiles.

To view of the customer customer ratings to held for banks to do better SME risk assessments.

And also with average of its platform to penetrate into many of the scenarios.

SME financing for example of supply chain finance invoice financing etcetera.

So we will continue to execute this.

To replicate this model to other areas I think China in fact, we have.

Several of mall findings with the provincial government starting from the early this year. So the short answer is yes, we do see government agencies as the runoff of kind of customer that we are very targeted we tried to build an ecosystem for financial technology services and help the financial institutions to build that.

Yes.

Got it thank you making share some very quick follow up.

From a strong.

Because we see.

The surrounding the.

Hi.

J D with the SDI injection.

The impact in terms of making from HDI.

Even quoted from.

Basically issues surrounding that so jewelry market.

Coming down I know the financial impact of immediate.

The impact of our overall strategy of growing.

What was the occupancy of.

Chip.

Yes.

Yeah, well thanks for noticing this of this new.

I just had the financial impact there will be very limited I think the JV debt.

The success cases, the affiliate rates at the August.

If the unfortunately the.

The JV with with the Spi in Japan.

Instead of to account for the course of the year, probably at the cost of the quality of our various other situations. So I think that's that we mutually decided to.

To close the JV.

But our cooperation with Spi will continue to remain a major shareholder alpha they're committed to to the company and we had a lot of cooperations often outside.

Outside of Japan, and Southeast Asia, Hong Kong et cetera.

Got it thank you.

Thank you operator, we can have the next question.

The next question comes from the line of Elsie Cheng with Goldman Sachs. Your line is open.

Hey, Glenn this is vishal the chemo all of that Glenn.

The conclusion is helpful lot Vishal goes on to the power plant.

In total <unk> now has the kind of getting of the hopper from Keybanc.

Thank you gentleman Jack can you just shortly host for today go out to the back of the volume that to the tune switch you. Please for the.

Johnny the John chronic conditions that can kind of allocated seating.

Yes.

Michael joined the Allison the cap that Lisa.

Julien downturn yacht yacht that Jenny Zhang from China.

And then the.

Cash interest.

Shall I kind of Iot as one would have attempted and interest from a shaky.

For the mix that day.

The COVID-19.

Sidoti from Sidoti <unk> co.

Thank you Jason at the Empire cash, Steve Zaccone with R&D day of an option.

Now I'll turn the I hope all of you shipped one of your line can be blend the update with the entities.

The drilling JV in Japan.

Ian.

So with that from the <unk> conference allocation of that.

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Q&A.

For our sugar taxes of Michael that line.

In fact of the auction Zappa technology the Feeney.

After the nice.

Continued from Q channel, Dr. Joseph Huang of <unk>.

With Japan, and the go along the southeast.

Southeast Asia and the main ore.

The engine.

We will take the shot show is that when you have a couple of Sean Mcgowan with some of the shaping of our guys can assist you can now take the call kind of thing.

Yes.

Good morning management. Thank you for taking my questions I have two questions first of all is just to follow up on the loan businesses.

We do see a very nice growth the country into the first quarter I'm just wondering for the next few quarters into this year.

Expect as sort of the similar trend Werent weekend had the growth with cash.

<unk> continuously.

To be higher.

To the year and then the.

A follow up question option of Steve mentioned about retail zone business mix in terms of secured and also from Andy do you have an idea like all of the historical level and where do you sit now and into the next few quarters, how in luxury change than the <unk>.

Second question is more of the business update.

Based on some of the previous discussion I just wanted to follow up at the mall.

On the cloud side, what are the customer numbers in terms of the value.

Contribution from third party customers of small in terms of customer numbers.

What's the current level.

For the cloud business the net.

And the second thing is it.

The overseas than the.

The contribution we have seen a lot of developments in the southeast Asia for our oversea businesses.

So I just want to have an update.

The bank and the contribution from the segment. Thank you very much.

Thank you for LC Micro me, it's going to take your questions related to our lending solution and then the second link about the cloud the agriculture ship items and then finally CFO.

We talk about the overseas revenue.

Yes, sure healthy tier one tier one type of deal.

Have a great food at the Olympia women each of you I'd also of Cui power from.

Actually the way more and so we will the Jan quarter, you've got thrown out there you could use the pneumonia indulging kind of institute of question yesterday. The IP. The primary of importantly, two of hopeful now when the highest of the Chooser net goal of nickel shooting angle, which is true that typically for US and then he thought that went the other one gigawatts or tender to the payoff of mixed but are you looking at part of that.

How about the listing national wholesale.

One of the easiest would you what kind of ratio outreach, how you catch the whole host of hydro of shelf maniacally isolates of.

<unk> the continuation of our Calgary, So just very quickly could translate I think for the for the long service volume and this is one of the key kpis.

For our different opinion thrive.

Monetary BSF wells of the volume after a month by month and there is also we hope that the trend will continue to recover as much as.

As well as to the mix tender when it makes a lot of saying we don't have the information I'll hand.

We'll come back to you later, if we have this morning for if we have this information.

Thank you Sir.

The other.

As downgrading of element.

<unk> <unk> from the other channels and as of the <unk> does that sound about GAAP biogas for charity.

So for us as the woman digital channel.

And whether the the churn benefit from hall.

Okay.

For cloud services platform altogether, we now have 38 customers for eight of which are from the non group.

As of 30, <unk>, our third party customers.

Okay.

So these are some of them.

The new England leukemia of digital was the memorial of congratulations to Tom that the agenda as the disastrous for and in China, We will complete the ecosystem.

And the degree from with other.

The eagerness of general however, the growth.

Growth kilowatt central flow genotypes.

For the Union.

Yes.

Yeah, Jamie the allowing it for Kinder.

Jim walk for the.

We're going to change.

So that is of Douglas.

The only with the goal of being from a single component of further synergies on the London.

As of June debt.

Of the setup of it.

For instance.

<unk> was that the origin of late with the Libyan as Union, we don't lets say the cumulative data that you'll go zone for mass ethylene here for the.

Now besides of the share of Linzess and with the system et cetera, and other from it.

Women's wholesale uncovered book.

It's a piece.

People that traveled for.

Keith block.

Women could withheld schindler.

However, the timing.

The <unk> total Cindy.

So the other.

Is the gene pool Q2 <unk>.

Thank you.

Sure.

Again, the pollution of some good generally yes is giving us ample net debt.

The data Quito.

30 of the Formula for months.

So she's on the portfolio.

Okay.

I would also like to give you more color on why we are seeing beta of our market shares from for in financial cloud Firstly for things.

We started building financial cloud in 2019 and in the well we've been in a clear trend in regulatory and policy environment.

The government is laying out a clear policy and secondly on the technology.

For many years, the big technology companies have been developing public cloud and they are leading in the area, whereas for financials around the all of us on e-commerce and being on as the experience. The group we are.

We have leading technology in financial crime and third is our strategy. When we are marketing we focus on debt.

We focused on big customers and we pack of cloud service with the other products of one connect we target vis vis COVID-19 going to.

Talking of commercial feed the commercial banks and financial holding companies and some of them are homebound now.

In addition, financial cloud is also of the basis of technology and products for one connect altogether. This is why we have been able to sit here bigger market share I think starting from the theory.

Okay.

I will cover the third question so the progress on the overseas business.

So far we attend to the 26 markets.

So far mainly in the <unk>.

Southeast Asia, such as Indonesia, Malaysia.

The Singapore and Cambodia.

And so far we have about over 100 customers already.

And on the scope, we our solutions include like the risk management claims and the banking system.

Also we launched our VP in Hong Kong last year.

Probably you have new debt is one of the HBV in Hong Kong.

But.

I think our strategy is a little bit different from others.

We mainly provide.

The Poland banking services for the SME customers. So.

Also in line.

With our overall objective to support it because some of these.

In terms of the.

For the approximate the revenue.

The revenue coming from overseas is the SKU of small is of steel in the low single digits.

So far.

But.

With the with the progress we will see more and more.

We can coming from the overseas revenue. Thank you.

Let me back to you for any time for 2012.

Thank you Elsie operator.

Operator can we have anyone else on the line.

We do have one more question from the line of Alex Yao of Jpmorgan. Your line is open.

Thank you management for taking my question just a very quick follow up on the cloud.

Can you talk of the <unk>.

From a dynamic in this market segment.

The.

Are you guys of who else is.

Providing the similar cost relative to financial institutions and also once you come out of other than teach you the.

With the financial cloud market. Thank you.

Thank you Alex target the question now.

We'll go to of Chicago.

And so the chemo in lithium day, so the ability to grow the eagerness that also will see the auditor chemo.

For the Avalanche of Tianjin the Hilli.

The weighted.

So some of the assortment of the Hyatt.

The game into the countries.

The only harmless overdoses of all of that already the development.

The Eagle net so the colon GLC gross bulk of bringing the total wishing your pension knocking on the generally.

170 of the Cumulus.

Lindsay this is being the anchor.

The total impact in that channel.

Of the top level.

You didn't use of them.

The witness a rule of law.

For the lesson in how propulsion types.

The COVID-19 meaningful published end of that.

The bill.

There's still a gigawatt hour when does the keys element of the debt of the with other than the.

The city of elements.

Teams is also for the user.

So thank all of the sale of launching.

Some of the cumulative EBITDA.

So looking at all of them.

The legal volume one hour.

Our non accretive of the Ddos.

Clearly the growth of cellular adhesion from Quito and Gainesville.

The silver Eagles this house of women side of the tumor.

And then the single Sara Lee with that level of debt.

The following the 11th couple.

There are already some good assuming the bigger ingo I think of them.

Some of them sit with other Youll ship so does the.

The quarter.

Nothing really as the portfolio.

Okay.

Right now in the financial cloud zone.

Continuing with the RV content and highway.

We think the R&R advantages in financial cloud include for asset number one we are more we are in more secure.

The non financial cloud originates from <unk> group for the financial business, we have.

We have great focus and prioritize the security of our cloud secondly in terms of the compliance we are closely working with the regulators.

True compliance.

And thirdly our.

Financial crowd of work with.

Iot of platforms that we are able to incorporate the local cloud with public cloud as well as <unk>.

Private cloud for.

Lastly in terms of comp.

As you know on financial cloud has been.

In operations for many years that we are confident that of we can maintain our costs and as very competitive the level.

The idea.

Good day.

So leading the way the celgene some of maybe or pockets of thoughtful of.

As I say this all seasonal items other than generally our lasagna Sunday of portal.

Yes, I think the person in the lead our little genius is about the tender for those that you send in the positive yes the necessary.

And the general areas of Charlotte from the softer for the time, England yet of the woman.

Thats a good of pilot of a unit of Apple.

So definitely isn't yet.

So.

So should I assume you'll coincident engle <unk> chief of total.

Lastly in the industry, we know that other than Colorado, we have passed and that for US we have been improving our capacity in cash.

2019, and we are confident that we can outperform outcome competitor secondly, we kind of also.

SaaS to paas, whereas our competitors and the only provide the paas services.

I think that sums up.

Earnings call today, we have over and look at the thank you for staying with us.

And thank you everyone for joining the call today. We appreciate your interest in following us and we look forward to speaking with you again.

Thank you.

This concludes today's conference call. Thank you for participating you may now disconnect.

Okay.

Okay.

Okay.

Okay.

Hi.

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Yes.

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Yes.

Good day.

Yes.

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