Q1 2022 Noah Holdings Ltd Earnings Call
Hello, and welcome to the Noah Holdings <unk> 2022 earnings conference call. All participants are in a listen only mode should you need assistance. Please signal a conference specialist by pressing the stocky followed by theory.
After todays presentation, there will be an opportunity to ask questions. Please note. This event is being recorded.
I'd now like to turn the conference over to Jim Go Lang Chief Executive Officer. Please go ahead.
Okay. Thank you.
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The agenda of today's conference I would like to talk about them, Mike Hobey food and agriculture on the overall performance of Noah Holdings in the first quarter and he told me too I like it.
Our main business segments, then, let's invite our CFO , Mr. Qing time to introduce the quarterly financial information followed by an interactive Q&A.
Beginning of 'twenty, 'twenty, two NOLA and Noah's clients, which are a risk off mode now of client relationship manager and investment managers. They have never experienced a complete multi sector superposition cycle of continuous high interest rate credit expansion 8-K, eight quantitative easing.
Liquidity collapse and massive excess credit at the beginning of 'twenty tells me too we realized that the strong happening aviation will be a challenge.
The first quarter of 2022 we talked with relationship managers and clients repeatedly and emphasize that that no. One was tempered when entering the theater and many people and what <unk> when it came out.
First quarter of 2022 we suggested now with clients.
Re examine the asset allocation of themselves and their families accurately rebalance the sensor application and make it a family as advocates and safer and more effective from the perspective of protection overblown.
Yeah, I'm going to war between Russia, and Ukraine is boring, but as a professional institution of wealth management, we suggested that our clients remain rational.
Under this dilemma the only certainty is that the market will continue to fluctuate.
This market environment is more suitable for quotation mark to make some managers.
I am.
Avoiding risks has has become a better choice.
Give me a big media north.
Location strategy to clients is protection for bankrupt.
Thinks they subprime mortgage crisis in 2008, the global long term quantitative easing policy and often liquidity have caused the huge inflation of risky assets.
And that inflation has penetrated into every corner of the world.
The reversal of quantitative easing policy has come and the federal reserve and other countries have started multiple interest rate increase that goes well.
Asset prices the shift from quantitative easing to quantitative tightening will be a challenging adjustments and the rapid withdrawal of liquidity, well 10 asset inflation deflation.
Deflation.
In 2020, one many industries in China was subject to strict supervision and frequent policy changes, which led to fundamental changes in the valuation logic of the industry.
And the market have colder than the actual economic data.
Our view is to delay question and judgmental in China's economy.
This judgment is simple impartial cognition based on intuition wildly judgment corresponds to complex combination the problem of China's economy is obviously a complex problem delayed judgments, maybe a wife away.
On the whole the directional China is from paying attention to efficiency.
Two paying attention presented to encourage scientific and technology.
Technological entrepreneurship and show the safety and Tolerability of T technology.
China's high quality economic development in the future encourage social phones to enter more early science and technology Fund.
So I have to solve the problem.
By the throat and independent innovation from the perspective of invested asset allocation allocating a certain portion of their pepto too early science and technology Fund.
It's an evitable choice to come back monetary easing.
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In the first quarter of 2022, the thing, but I think location given by Nellix CIO often is protection of our growth.
Yes.
On the strategy and.
Implementation path, we suggested Noah's core clients start from the following four aspects.
Check the allocation of themselves and their family and pay attention to asset protection and enter segmentation.
Secondly on the domestic public securities market.
I commend allocation to multi strategy, which involves mainly from the perspective of protecting essence, reducing volatility and preceding dividend.
Finally.
Kind of ethylene investment fund is the main category to cross cycle and maintain growth for high net worth clients.
We suggest our strategic allocations of science and technology and pay more attention to early industry fun, Whitehall town, which have experiences to write through cycles and special opportunity funds.
From the perspective of long term ethically.
Thanks, Mike.
Against the inevitable long term monetary easing durations, I think advising them liquidity.
I'd like to emphasize that Noah and Gopher asset management G. A private banks and have a client hymer with individual clients there.
Therefore, our starting point is to understand client needs and take protecting the safety and profitability of our client assets as the starting point the transformation from product driven to client centric has a far reaching impact on our.
Strategic choice and management model.
Finance is a.
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Industry.
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Show companies close them and their clients as it shrink significantly.
Operator, I remember when we make some key fundamental position the first criterion and supervised and not make stay tuned mistakes. It is impossible to not make mistakes investments and asset location, but we shouldn't be real time and space for us to correct and tolerate them.
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Sonya.
In the first quarter of 2022 facings are extremely complex macro environment no adopted by core business strategies.
Completely reduce cost.
Second utilize multi dimensional surfaces and reach out clients at the main path as well as to set up a go to recover lost clients and increase the watershed of existing clients.
But make every effort to develop new products to meet the protected needs of clients and then post the pandemic.
Fourth maintaining high.
Productivity.
Okay.
During the epidemic prevention and Lockdown period, you good interpersonal relationships among clients employees suppliers governments and medical institutions.
In the first quarter.
Operating cost fell sharply down 33% year on year, and 57 quarter on quarter. The operating margin reached nine 4% down one 6% year on year, and a significant increase of 29% quarter on quarter.
In 2022, the company's goes the same as noticed as allocation strategies with clients and their families, which is protection of a growth client centric and survival as the bottom line in this quarter. The non-GAAP net income attributable to shareholders.
The 310 million down 32% year on year, and up 8% quarter on quarter, reaching 22% of annual guidance.
The first quarter of 'twenty, one to achieve a net revenue of any lease.
796 million down, 35% year on year and down 37% quarter on quarter.
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The total transaction value of the quarter was 315 billion down 45% younger than 29% quarter on quarter among them. It is worth mentioning that the private secondary funds in the standardized product category decreased by 69%, yeah, yeah, and 40% quarter on quarter, mainly due to our.
Initiatives to reduce the lunch of such product market Volatilities.
Transaction they are private secondary product to work and be 4 billion, mainly consisted of CPA strategy and results.
Reverse strategy the transaction that is a mutual funds with $77 1 billion, meaning monetary funds and banks typically deal with it.
Pakistan.
Well the mutual fund business that we now offer more than 10000 from providing clients with a wider range of product choices.
While treasury now serves more than 200 institutional clients in automobile manufacturing science and technology as well as other industries.
Transaction value of private equity funds, it wasn't going to be $3 2 billion down.
Down, 33% year on year, and up 5% quarter on quarter.
In terms of international business, we adopted the same strategy to significantly reduce the product launch and an allocation in the secondary market.
On the protective strategy in early primary market funds, the net income of the overseas sector work.
Hundred and 19 million down 44% year on year in Tucson.
Two 3% quarter on quarter accounting for 24% of the group's total revenue.
Overseas transaction value reached there's going to be $2 4 billion a year on year decrease of 35% in a quarter on quarter increase of 3% accounting for 16% of the total transaction value of the group.
The overseas.
$29 1 billion with a year on year increase of 12% in a quarter on quarter increase of 3% accounting for 18% of the group's total ever.
I would like to emphasize again that the decline in the transaction value and a public securities in the secondary market in first quarter of 2022 is a market behavior of Noah to protect client assets.
Actively objective product launch.
The fourth quarter of 2020 one in the first quarter of two north caulk is to reduce the secondary market product allocation and lunch increase the allocation of protective essence and support the hell infection of clients family asset portfolios.
The second U S allocation strategy is protection of Evercore.
Due to the impact of the new short term regulatory policies.
The transaction that is a protective accuracy in the first quarter was any of the $700 million down 17% year on year and 40% quarter on quarter. We believe that the allocation scale scale of these assets will be improved in the second quarter.
In the first quarter of a penny going to that will continue to adhere to the strategy of promoting this track and field management and as clients and a number of coker and diamond in Black Hawk continued to grow to nearly 8300 a record high.
The number of blackout Diamond card clients increased by 31% and seven 3% younger respectively, together, representing a 12% growth year on year in.
In 2022 client growth is still one of the most important strategic investment in gross growth of NOLA at the same time. We have also established a project growth goal to recover lost clients and reactivate dormant clients identify Korean quota numbers both their pinpoints.
And the headquarters level focus on the conversion of those times, if I understand that standardization transformation and take multi strategy funds as a stabilizer to meet clients' demands of conservative assets.
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Sonya the net income.
The net income of the asset management segment in the first quarter of 2020 to be $200 million down 26% year on year and down 27% quarter on quarter. Among them. One time Commission and performance based income both decreased while recurring service fees increased by seven 5% year on year.
Reflecting the ability of London assets too.
To bring sustainable income focus.
We used a slightly children be $166 1 billion compared with the end of last year.
Which private equity increases slightly to them would be $132 7 billion compared with the end of last year. The a O M. A public securities slightly reduced to RMB 10, 4 billion. The excise structure is healthy and inline with expectations.
In the first quarter in view of the sharp price falls Chinese ADR the war between Russia, and Ukraine challenged domestic micro economy, and the prevention of lockdown or the epidemic in Shanghai Gopher conducted a cash flow survey and net value evaluation of all primary market funds and its direction.
Okay.
Well take a more cautious and conservative investment strategy and strengthened exit mentioned goldfish domestic early stage industry funded one special opportunity secondary funds and go because the U S team directly managed American Silicon Valley, California.
Rental apartment real estate funds have performed well on the whole creating value for clients when market is volatile but.
Public securities by the end of the first quarter growth of standardized products have also delivered robust investment performance among them. The annual return of Gulf of Mexico had a manager of managers fund was 10, 7% exceeding the benchmark return rates by nine 7% from the same period.
The annual return of top 30 funds was 11, 1% exceeding the benchmark muted by foreign packaging.
It is worth mentioning that all three types of funds Gopher stabilizer Congress strategy active balanced and stable continued to outperform the relevant indices.
Market fluctuations in the first quarter.
Its establishment the accumulated returns have been minus two 1% minus one 6% and minus 0.7.
And 7%, respectively, and a pullback is far less than that hurt the CSI 300, 800, bj's in the same period effectively controlling fluctuations and pull back.
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Sonya.
Sure.
<unk> is headquartered in Shanghai from the beginning of March Shanghai has entered a stage from a network locked down to a complete lockdown from the start of the Lockdown Noah has established several epidemic crisis management project teams.
The group management team is responsible for the overall management doing the academic decision, making on key metrics.
Adjustment of strategies in response to the development of the epidemic.
That makes situation assessment team will conduct real time assessment of the epidemic situation development in various regions and provide insight into the company's decision making.
Cause any communications team is in charge of HR and organizational development department to ensure that the latest the policies of the company are conveyed to network management team above elaborate team and a transparent and timely manner.
I think that make emergency response team for me like corresponding policies. According to the external ecology, such as employees and clients governments and public welfare and income combination with the 2000 and degree of the academic and government regions. So as to minimize the impact of the epidemic on the company the post epidemic.
<unk> team is composed of asset management wealth management, and our international Intelligence, Seattle office market and felt like no triangle teams to work together to adjust the marketing strategy realtime. According to the development of the academic identify opportunities our clients needs and make full preparations for the growth of therapy.
Academic.
In the past 40 days Noah has delivered more than 500 trips of groceries medicine to employees in Shanghai.
<unk> medical treatments and support to in fact, its employees and delivered more than 1200 trips of supplies to call clients, an H crimes in Shanghai.
Same time, Noah has coordinated results as to meet clients' medical needs and links golfers underlying portfolio companies to deliver various groceries and medicines to help clients employees and suppliers to go through this difficult period.
And this process now also provided psychological counseling causes for employees and clients purchase of various medical materials until may hit them in batches to Shanghai House Convention Hospital station planting Suncoast community frontline pricing.
Places there are more than 20, no employees, who have been stationed in office in order to ensure the continuity of the Companys business have not returned so far.
Noticing pensions careful clients employees and suppliers and sense of responsibility towards society have been widely praised.
With professionalism and empathy Noah is devoted to accompany claims from generation to generation.
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Yes.
Before 2019, leading products I wanted to know is core competitiveness from the second half of 2019, Noah has implemented a comprehensive transformation from product driven to client centric and survival as the bottom line, we firmly believe that only by some ceiling taking clients at the center.
He can interest in line with clients and establishing the organization capacity of clients in Chesapeake can be can we avoid being scaled centers Commission centene and self centered.
Nowhere has been engaged in the wealth management industry for nearly 18 years and has experienced many economic cycles.
We deeply we like that many wealth management requires strong ability to link with clients. In addition to aetna applications packages.
In the past.
He's in China's wealth management industry, when not all professionals in the industry standard on Korea. Some places we're full of species the statement balances that large claims and some practitioners themselves come out even understand it.
Therefore, as a practitioner of wealth management, we must have to hire a professional ethics regatta pursue took the true knowledge and wisdom as a moral responsibility and consciously put him them to order positions, but I am determined and made by position.
We should really establish the wings of trustee responsibility treat every penny given to us by clients and the parents lifesaving.
Only then can we understand the trustees responsibility.
Although in the first quarter of 2022, we can barely encountered challenges and pressures in the mercury that environment.
It's precisely in the face of a ticket cogent T beyond the combination of those people that know us.
With all of our clients it further.
Further highlighting.
The client activity of other online sharing has increased significantly due to a number of lives on the we know what.
Increased by 98% year on year, and the number of dealers increased by 210%.
And small scale video concentrates in tires in Q2. These became widely popular relationship managers have been able to obtain more and deeper client touch sensors.
<unk> seen that in the past this.
This is also the warmest embodiment of milligrams at the same time the line of a healthy financial situation. We continue to make some investments in client interface brand image and marketing in attracting excellent external talent and practice investing in feature in difficult times.
Now that's in vitamins the gene patents are grouped into these detailed financial performance of the quarter. Thank you.
Yeah.
Thanks, Tania and thank you Charlie.
Hello, Dear investors and analysts.
Charlie do you want as mentioned the first quarter of 2022 has been a difficult one.
Lingering impacts of the COVID-19 pandemic.
As well as uncertainties around the macro environment policy changes and geopolitical conflicts.
These factors were reflected in the challenging capital market environment overall, with MSCI overseas, China down 23%.
Shanghai Securities Composite index down, 11% as well as NASDAQ and that's P. Five plug was down nine 4% in the first quarter respectively.
The merchants have negative volatility has started to pressure the equity market since the second half of last year translating into talk to and investment in the <unk>.
Buster sentiment evidenced by a decline of 74% year over year, 57% quarter over quarter decrease new issuance of mutual funds during the first quarter of 2022.
Nevertheless.
No one has managed to weather through these challenges with a client centric mindset continuing to in larger black card environment hard client group made noticeable progress in our client segmentation strategy and also cheap.
8% quarter over quarter increase in non-GAAP net income with disciplined Opex management, while remaining committed to essential investments in client and the market strategic initiatives now.
Now, let me walk you through more detailed results of the first quarter.
As a result of the lackluster performance of equity markets in the first quarter as well as our adjustment in the secondary product distribution strategy as mentioned by Charlie clients investment sentiment Stockton.
As a result, one time commission income was down on the back of a decrease in transaction volume.
From RMB 27 billion.
In 'twenty one quarter one.
Same period last year to RMB 15 billion in 2002 quarter one.
Carry income comparing to the first quarter of 'twenty, one record setting quarter.
It was also down due to the weak performance of the equity market.
As a result overall network.
RMB $796 million for the first quarter down, 35% year over year or 37% quarter over quarter.
One time commissions declined to RMB $102 million due to lower transaction volume the challenging market conditions.
The distribution of offshore life insurance products also slow down during the quarter as we made necessary adjustments. According to rule published by the China banking and insurance Regulatory Commission in October 2021, our team has managed to complete these adjustments in compliance with the new rule in the first quarter.
And we have resumed distribution of bonds for life insurance products for clients of which the financial impacts will be reflected in our second quarter results.
The stabilizing revenue stream, which is the recurring service fees remained stable at RMB $484 million up one 9% year over year stood down 13, 3% quarter over quarter, mainly due to now, but just months made to public security products.
Performance based income was RMB 174 million blocked from the previous quarter.
Transaction value was RMB 15 billion for the quarter down 45% year over year, 29% quarter over quarter due to a shift to risk averse sentiment among investors when faced with growing macro policy and geopolitical uncertainties.
As a result public security products, including private secondary products mutual funds decreased by 34% from previous quarter.
As a wealth management firm and trusted advisor to our clients, we believe that maintaining communications with our clients and guiding them through this challenging and volatile market is utmost important task for us.
I'm glad to say that we have done an excellent job in that regard.
Enlarging our quartz mining group, including our black card environments. Our clients continues to be the foremost strategic initiatives. This year, we're happy to see a 12% year over year growth in this client group.
More specifically Blackhawks volume environment card volumes grew by 37% and 7% respectively from previous year.
Thanks.
Patient of a more targeted client segmentation strategy and operational announcements carried out in key cities and regions.
Through our mutual fund platform Smiled Treasury platform. We also made substantial progress in acquiring and engaging corporate and it.
Institutional clients.
Number of active corporate institutional clients increased by 33% from the previous quarter and the mutual fund products, though we allocate corporate institutional clients increased by 88% year over year.
Charlie do you want to mention we believe there is large but underserved market for Treasury management services needs amongst small and medium sized enterprises.
We will continue to explore this market segment.
SAP solution platform as well as leveraging our larger product.
Well established service network.
Income from operations were RMB 314 million during the quarter up 130 up 137% quarter over quarter, but down 38% year over year as profit level in the first quarter of 2021 was largely benefited from a record setting performance based income.
Operating margin was 39%.
An improvement from 11% from previous quarter due to lower compensation costs as well as stringent management on various opex G&A expenses.
Compensation related expenses.
RMB $358 million.
Now, 39% year over year at 51% quarter over quarter.
As relationship managers commissions decreased on lower transaction body <unk>.
<unk> income was RMB $25 million.
We recorded a gain from our principal investment.
Our capital network based on fair value appreciation.
non-GAAP net income was RMB 313 million down 32% year over year, but.
Up 8% quarter over quarter.
As for our segmented results net revenues from wealth management segment was RMB $578 million down, 39% year over year, and 40% quarter over quarter due to a slowdown in transaction value during the quarter net revenues from asset management segment was RMB two.
100, $201 million down, 26% year over year, 27% quarter over quarter due to lower performance based income.
Hello, I am was RMB 156 blocks.
From the end of last year.
The increase in <unk> was.
Largely offset by net adjustment and public security products and continued exit real estate products.
Moving on to balance sheet will remain healthy liquidity position as our current ratio stood at two six times debt to asset ratio was 23% with no interest bearing debt on our book.
By the end of the first quarter, we had RMB three 9 billion in cash supported by its strong balance sheet, we're able to continue to provide high quality services to our.
Clients during this challenging macro condition and lingering impacts from the COVID-19 pandemic.
In light of the recent volatile environment, We published our first addition of Noah Yahoo has to be a report.
Aligning our global macro sites and a recommendation of our clients adopt a protection for us.
Brooks.
Strategies for 2022.
With a more comprehensive and detailed solution scrubbed. Your reports followed through our relationship managers are better equipped with investments solution recommendations.
Her to work different markets, and our roof and client profiles when engaging with clients.
Shifting from a product for them now model to a client centric and solutions from our models with.
We look forward to pushing ahead, our key strategic initiatives.
Our investments in research capabilities to differentiate our solutions driven I would say.
Services.
We'll continue to progress on enlarging our institutional client base.
Regular service platform and we believe this will also provide since then there are terrific opportunities for <unk>.
Individual wealth management services in the years to come.
And thank you everyone for listening I'll now open the floor for questions.
Operator.
We will now begin the question and answer session.
Ask a question you May press Star then one on your Touchtone phone.
You are using a speakerphone please pick up your handset before pressing the keys.
Withdraw your question. Please press Star then two.
At this time, we will pause momentarily to assemble our stuff.
Okay.
Last question comes from Ethan Wang from CLSA. Please go ahead.
Thank you.
So that's.
Hi.
Good morning.
We're doing that warranty people.
<unk> is our leverage.
Average EBITDA level kind of issue too easy to just growth.
Judy charming Charlie.
Thanks, John .
Chip performance.
Sure.
With jumbo issue beyond Egypt.
Okay.
Traditionally people do accrue.
Two questions, which I think should we attribute our interest would be.
John would you shoot.
Yeah.
Sure.
Which we shouldn't each year.
Cool.
And then switching issue Jake.
Sure, So English, which would change your strategy.
Sure.
Thank you Richard.
Schedule management I have.
Two questions.
The redemption.
As a management products. So we understand that in the first quarter industry itself written put ourselves what have we seen any sign.
But two of the top redemption.
Florida.
Especially for different tiers, it's times like my first question second.
Second question.
C level.
Just wanted to check with the Frenchman.
What are we seeing the pressure from the phone so I wish I had the pressure.
C level.
<unk> negotiated.
So that was more companies. Thank you.
Okay great.
Great on the floor.
How long do it yourself.
Well it wasn't what you end up with is not what would you want my husband failure will truly the tariff regime to go Copel telecom about Chichester attention is could you talk us through that then you can kind of that's what you do and then does it go above.
So I'm seeing double pushing that they get to kind of take us announced between the data Joe Allman, Jan Schott with it a telephone telephones are a sure way to kind of go with John Telecom equation, so that hydrogen which helped her daughter John Cushing.
She is also used to control it <unk> Cta totally it sounded you go people Chicago Philadelphia, The Jones day residual Jack just usual door, though traditionally Banca channel that they don't need.
<unk> moving up.
Uh huh.
I would just went arbitrarily teaching element there could you just take our total atg jointly I kind of halfway to have that shop as they mill cleaned out there without windmill, just real quick Josh Charlestown.
I'm going to answer the NOI or language ml pulled off daily dose of reality, though and he will do the pulling off the reality of the husband. So you'd have there's always hope that that whole cohort of foods.
<unk> got a little I can leave a woman she said the pivotal data been disappointing in case. It does it will show the time. It is the army army and wound up with utilization therefore closely Chan Luke.
It will definitely be a simpler 'twenty all else equal more male crazy I'll hop back in just with all star about especially now are you able to talk to the other jobs that Shanxi Aloha Robin just a quick therefore without both of Assortments based on all the fishing. So its ultra that can cope with and that you do have you all got a little extra time.
I'll do that kind of watch it I will lead you to walk away, mostly shallow what that will look like in my talk and this is essentially a hospital.
So it may all pull down and go Greens on the Saturday the Alibaba.
Conoco EOG anyway, it seems to be kind of the amount that's how can I just.
Sure.
But any kind of a woman that sheen, yet well mentality to ensure you that you'd be hard Jamaican should complement the carrying amount of film Canada July Angel for machine to machine the tissue that they get into.
Oh, it was used for that dialogue on one.
Okay.
I will translate briefly of what chairlady has that supplement some of my inputs.
To your first question Ethan I also thank you for asking about Shanghai, where are doing okay.
First question I think it's actually a strategic reallocation between different strategies in terms of.
Your question regarding whether or not this large redemption.
Since last quarter, we have been pushing.
Pushing forward the protection for its kind of strategy for the client allocation stripe.
So we did not see a huge outflow are pure outflow net outflow if you will from <unk>.
<unk> funds.
But rather a reallocation probably between long only.
The funds that shooting for output in the market, but to a more balanced type of product like the CPA neutral strategy, especially the multi describes the kind of products.
Products, So we'll see some rebalancing between different strategies.
In terms of fee pressure from.
From the fund providers of fund managers.
It really depends on I guess the performance of their funds when they do see.
Large group of unhappy clients.
It probably will experience some pressure on the fee.
In terms of the suppliers that we work with we have not seen too.
Too much of a downward pressure.
In terms of the fee ratios on these funds.
And.
We actually started preparations for the shifting strategy upfront fund supplying IC.
You will all probably a couple of years ago.
Moving to more balanced portfolio.
Especially like the multi scribes content products and.
Also started exiting from some of the funds.
Presently the long only funds and that is probably part of the reason that we achieve pretty high level of carry income in 2021, but in terms of fee pressure.
Especially how we negotiate with our suppliers.
Haven't seen too much of a change unless the fund is really.
Performing really party.
Ethan.
Product.
Okay.
Yeah.
Okay.
Thank you. Your next question comes from Anna <unk> from Bank of America Securities. Please go ahead.
Hum GA in Q1 as well.
Thank you Daniel.
Can you go or do you just not willing to.
Jacob I would think that there's no come on but I need to make some valid as it shortens uses of counsel Michel download. She knows she has been because it seems like I'm going to use them now I guess, Ben Jordan diabetes household and garden in golf right now cause I think thank God, it's always not the usual Chilean labeling.
And I apologize I was always a monthly check them sounds alcohol Jacob.
As you can see that we freed up now Jose will go when she sees value. In fact this is one of them have come out Hudson's Elisa.
They have huge audience outside alcohol.
And how comfortable do you a phone call not to go to a woman.
Awesome.
Now oh amount or element just to chime in if he like Zigbee all female Pascal.
That doesn't mean people want me $10.
It could be down a cause that don't add anything to that level.
I will Miss you say yeah.
And what I see because I mean, there's a whole thiago.
I guess my question I have two questions. The first one is about your insurance L E.
In the first quarter.
Drew himself was impacted by the regulation issued in October last year, but are you already nexon rectification and achieved record second.
Second quarter, so could you elaborate a little more how the regulation impact your insurance business and how are you able to achieve a recovery in the second quarter and the second question is about Colby as impacts on your business because I think they are more call it looks out in China.
Second quarter, so how will it impact your business and you I feel Uh huh.
Your line to achieve your full year net profit guidance and how do you. How are you planning to achieve this guidance.
Very tough fourth quarter alright, thank you.
Okay.
Okay.
And let me know pension is John Chow.
Okay.
Hello, Matt.
Sure Pete.
In Brazil, we don't know when trauma okay.
The impact on the new insurance.
Regulation was basically there was a very abrupt cutoff on the compliance date, which is December 31 2021.
You know the the previous.
Sale.
And while on the Internet.
Not continuing to be allowed as of Jeremy It for 2022.
Do you have to obtain the license.
And cities to be able to actually make that still and at that time, we were actually in.
In the middle of application for that permit.
And we obtained the permit actually in the first quarter of 2022.
No.
It's basically the abrupt cutoff on the rules and regulations sort of caused a pause on the scale, especially for the first couple of months in the first quarter and once we have obtained their permission I'll be able to do the sale starting from the second quarter. So the financial results.
Reflect on that.
And.
No wonder with Bosch ample amount of work with them.
When looking at months and months ago Okemo.
Oh, yes.
Now, let me get off without any one of them.
<unk> heard you.
When they do have some thoughts I'm sure you go to the phone calls to them.
Obviously, each one going up to that increase in health insurance.
Paul.
What would your initiation datapower colloquial Hong Kong Shanghai, Shanghai, That's just technical question really a tuition enrollment that chunk of accordion does is youll fishing module sure. That's all that's all based on KOL Modesto woman chunk will go to deal with <unk> does.
So you will meet that used to the bathroom habits as youre, calling the ges to Miami and they just go over the cause that you'd have to.
She genre of Goldman which will deliver even though that the machine itself will do well.
Okay. So even though there's a phone call or go to <unk>. Thank you and a genius attempting a little.
To that then don't have favorable meal GCI vessel.
General to look at this AGM to visit that Televisa, Chile, you do sometimes using the three o'clock central and I don't want me got Ya.
Just in Shanghai Crazy Baidu could hold back the Shanghai cookbook.
The data highway registered a woman, which you don't want to just the calendar.
Sure. This is your you will have the minimum goes without <unk> colored glass and kind of I think they're generally shield sunshine.
Hum.
Dan I appreciate the agenda, how soon on Georgia.
Look on the beach, how does your inventory so that will.
Some of that to be the control things yet.
So you mentioned the Soho walnuts I hope we've got do you think that you're taking the truth I can cover that stood out for you.
Intelligence, what that means I mean, that's all she pension Josh.
Paul.
So am I better go quick summary.
Clearly that's shared.
Basically I think a couple of reasons one is Shanghai obviously.
More impacted.
Other cities nationwide.
We'll still be able to hold the client conference, although a much smaller scale than in the past, but still be able to you're actually getting touch where clients and.
As you would mentioned that.
<unk> as you would imagine that under situations like this the desire to connect with people.
Actually becomes stronger.
No.
The client actually insurer act without on a more frequent basis and.
Curious, we'd probably stay more prepared.
The competitors, if you will especially from the product distribution.
From the online.
I'll ask Sherman session.
And especially on the diversity of products as well as services there'll be able to provide them with the clients under different situations.
We have you know primary secondary as well as our cut and sew far comprehensive services, especially.
The capability of placing oversee our U S dollar products for our clients to.
Actually provide them with more options. So we believe obviously will bring.
Negative impact.
I guess on the market overall.
At the same time it also heightened I guess the need, especially the anxiety.
The uncertain macro situation declines actually more willing to listen to you know one is.
More options in terms of allocation of assets choose there looking forward.
Do you have more safety Christmas if you will on their assets. So I guess, obviously there is impact, but we also view that as the opportunity.
As we have a very strong balance sheet and also liquidity.
This is for the reasons that will continue to make investments.
In client interface related as well as the city expansion.
Market share.
So in terms of the guidance I think that's a very good question, but we're actually making our budget.
On the basis give me all guidance, which is already in the midst of first quarter, we actually anticipated.
I guess, a challenging first quarter, so through the guidance of how we achieve the cost level.
We did put down our first quarter as probably the most challenging quarter.
But still I guess the situation was.
A little bit our expectations on a couple of things one is actually our citywide corn channeled Shanghai, though was not forecasted.
And she was really the the <unk>.
The application for the insurance company took a little bit longer than we expected. So we're probably a little bit behind.
What we originally planned for the first quarter as profit.
But it's.
GAAP long enough that we'll be able to catch up in the.
Following quarters.
Emma.
And I did that answer your question.
Okay.
Okay.
Thanks.
Thank you. Your next question comes from Yale.
The ICC. Please go ahead.
Hey, how about Oh Wow.
I want you to remember.
Okay.
Hey, how long how they switch off mongo, how it pans out.
I don't know how to go.
I used to say, sometimes citgo once it gets you wouldn't feel quite how what's your drilling goes up I think she was on Yo Yo Yo.
I'll get to the societies as well can you could probably should help on things that come up that much and seem like yourself, who are thinking about something called shortz issue habits.
And golf and golf Trisha I said I'll close it will depend on her dry dock when she's got it.
Okay.
So you don't think you should go away.
So that was always it doesn't come in it sounds from clients of Jonathan.
It sounds like that will come with some James Gotcha Charleston, It was off of course without Toyota.
Oh look how much I know how can what does that margin equal or something or go when I'm looking at what works what ships actual shot buckeye content to accomplish that.
Yeah.
It shows you called out some of them don't take unpopular.
I Should've I'm sure she knows what besides all cause it's a function that we stopped they hold are you doing.
Uh huh.
<unk> gone anywhere.
So.
Sure she couldn't until that's a good thing so they should top lines of what both of us.
First of all the countries in Shanghai.
So it's I'm not going to tie shekels. So sad that you won't come with a giant she was just talking with my body without a whole lot.
Looking quickly.
I see two John couldn't because he thought about it.
Oh my.
My classroom so our marriage.
Non core taking my Crosswinds I know you'll find some philosophy.
I'm very excited to see the stable growth of our number of core clients I have two questions. The first question was regarding Oh, that's not a wasn't manager wants to give us more introduction on the progress of the business.
How much of your portion.
I'll have to check on one transaction value.
Oh God.
Great.
Seven o'clock.
The course of the number of relationship managers.
Tell me that.
Yeah.
Well I'm, putting them anyways and I always ask for closing remarks.
Okay.
Thank you for the question and thanks for the support by the way.
In terms of where both currency and the Shanghai I hope everything is there.
Are you and your family are doing okay.
In terms of the mono Treasury, which is the institutional version of our mutual fund platform.
Virtually started the campaign.
Officially in the first quarter, and then obviously strategic initiatives initiatives and push for that.
Reason being is that we're actually seeing a gap.
In that service that you know majority of our clients, probably 60, 70% of our clients are entrepreneurs and they have their own enterprises, which is oh, either lactic steel mills to work with more market oriented.
Treasury management on money market type of funds or.
Or are they actually didn't have enough research ability to actually navigate through the mutual fund market. The reason being is that in the past the treasury function of pretty much the buyers buy the brands products and as defense products also shifting towards that.
Outpaced product it actually large yeah.
No.
Our traction in the past and the treasures are forced to actually to squint through.
Sort of money market funds of mutual funds and no it's actually able to.
To sort of transform the experience we have on the mutual fund research and capability and also placing that with very conveniently designed SaaS.
SaaS based solution for these institutions, so we actually use that as a strategic opportunity to actually expand.
Particular gap in terms of service.
In the market.
We understand there's not much a similar products in the market and.
There will actually be able to make pretty good progress we gained about.
250, new clients are in the very first.
To shape up.
It will accelerate but at the same time.
The AGA.
Obviously in Treasury light funds it doesn't contribute to a larger revenue right away.
But we're pretty confident to see that growth in the in the following few quarters.
Does that answer your first question.
I don't think I've seen.
It's always my mom cause it there were times when was that.
Well do that.
They always also corridor.
Usually they usually unfortunately, we got to see them.
Cancellations, Russia.
Thanks for taking on <unk>.
We will do whatever it is.
During the Hajj as long as that will be the year, we saw the.
So that's all part of the market our.
If we cancel out the door the codell kicking or.
<unk> was introduced to guys like us I just listened.
Welcome to the <unk> two.
So typically you will have to absorb it since you're not willing to adopt them.
It's always great to the superb baja to touch on that.
Quick one year with the title song.
So it's all good to talk to them so.
So we would go into it.
Great.
Yeah.
Yes, so two months ago, we mentioned that it should go down because that one.
More time for your cold Downhole and she had to go cohorts I know you bought ching jaw to go find.
Bye for now.
So people will choose a woman.
Yes on Kashi came up to good to go.
Campaigning no much at all at the heart of what we're going to let's say parts of where you're coming from.
Hi, Paul.
So you go from a hot summer tires should go play golf or the woman to the change in time here. The Green shoot you want a bushel hall.
She got Coca Cola and Thats the objective.
She also onboarding, a fourth cohort before the Ciena Yoga tour, which ship and ship and go to the frequent visits each year.
For me it doesn't.
Sure sure sure.
It's opened up a few times it on bobby's of potential clients for us.
Other big boxes.
That's where it comes out.
Thank.
Can you guys just where they go.
Tyson and Shaw.
Shelf would it be a woman to the dark orange.
You can now buy box. So you took the tissue.
Telling me how do you again kind of how you that transform our F&B female it will get down to just shot shell DISA.
<unk> he chuang for you since Huh, John Yeah, the two 1 million.
One when it comes to the New York sampling Chinese out without a control.
Uh huh.
Well I havent shown them just as always you can come back to you for that.
Just as I said, I'm, just giving they ought to local news.
So you can look past the baby out with the hidden taxes, just some dry hole imagine you wouldn't do with leasing up well I shouldn't have will make it up just now.
Jan Kees de Jager popping a bunch of stores.
I'll do them in Idaho at Samsung on Cuba.
Typically when you see those pop hydro both with Tommy.
Oh <unk>, yeah, So I'm gonna just towards your other question can you repeat your question don't you think or is there something that's pushing down pumps again, though.
I was just kidding I fully live content possible.
We will.
We're going to depend on how quick dotcom digital wallet.
Now this is only our courts will have little thing. Although this will now cohort he or she is also a double quote non deluxe Aloha bogey of one of the calling them in cohort one which is all the goodness of my body language.
She had got into cohort how Goldman timber Morrison.
Right.
Jason can you think of work from home posture.
178 could be down the agenda.
Thank you for a couple of puts and takes from increase in that.
Lately or what's the cohort analysis and the box RP ship.
We will also go up we'll know UK lower legal Colgate cause a woman can you talk about how they impact the <unk>.
And then go through a digital younger cohort.
You may begin.
Of course, you don't want to negotiate it has its own alcohol tobacco and Utah.
I think of course, we're going to have a really reaching.
Each in MA, how that's progressing komodo predominantly <unk>.
Our major facilities.
I think it should be I mean, just the guangxi.
Well most of the Taco Bell here the whole Google functional hustle, you can hopefully adopt downtime with Alibaba in the Australian residential with ERP.
He really does Hans off tons on share count and go into the cohort and then go well do it.
The whole lingo totally hit one.
Thank you.
So this all goes on this year.
Well second part, but they do have to do well in the hospital.
So first point is that we actually did ship from I guess immediately following the transformation in 2019, you know obviously the priority was to stabilize the team.
So the strategy was to retain as much talent as we could.
Then we started off the transformation has been completed in 2021, we'll start off our transformation in terms of talent.
<unk> talent retention only two kind of upgrading.
So the model change on a number of number of Ritchie managers is really the result of how we actually being a screening.
Better on them and we're trying to hire.
Lot more advanced or if you will you know a lot more experienced and excellent managed to the talent roster. So it's really upgrading.
The talent perspective, and second point is also we actually it's interesting that we're seeing quite a bit to repay training clients. If you will that you know.
During the so-called mountain standard time.
A product here.
Some clients May probably go to another institution at the same time as he brings with him. The professional best serves with them. So now we're seeing quite a bit of repaid with clients because after all the transformation as well as the market condition. The continued to realize that Noah has been married.
Borrowings at the same time.
Being pretty professional about our.
Product selection and also product recommendation.
So with the repatriation of this group of clients. We're also seeing.
The inflow of the radiation managers.
Mhm.
Hello, everyone.
We'll see how long of a pencil. Thank you.
Oh sure.
Thank you. Your next question comes from Peter Zhang from J P. Morgan. Please go ahead.
So Google Kubernetes, we're sure will come up with something of one train.
Suncor is T mobile.
And the update okay.
Well I'll give me the opportunity to ask this question was chaw checklist blender until we have.
More update on our Hong Kong team. Thank you.
Thank you Peter Youre, obviously with the pressure that's being placed on the Chinese.
Yes.
Especially the so called a pre delisting prices no one similar house other Chinese Lps have been exploring other necessary option.
Hong Kong is thing obviously is one of the pretty apparent positions, but at this stage of time I'm just I don't I don't have any liberty to comment on that hopefully you understand.
Sure.
That's interesting.
Thank you thanks Peter.
A question and answer session I would like to turn the conference back over to your speakers for closing remarks.
Okay.
Thank you and thank you everyone for the Investor and Alan Thanks for the time.
Yeah.
Sorry about that.
Okay.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
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Yes.
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Yeah.
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Okay.
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Okay.