Q4 2023 Waterdrop Inc Earnings Call
Okay.
Yeah.
Good morning, everyone. It's Tracy.
After the leadership.
Speaker Change: Welcome everyone to the recast fourth quarter.
Speaker Change: Fiscal year, two three or even companies call Albany to be.
Speaker Change: Sure.
Speaker Change: Right.
Speaker Change: Today's conference call.
Speaker Change: Please note that the discussion today will contain forward looking statements.
Speaker Change: Our presentation of the U S.
Speaker Change: I mean, I know that he gives you.
Speaker Change: Goodbye.
Speaker Change: Looking famous athletic too risky and say to him and cause actual results to differ materially for Nick.
Speaker Change: Thank you.
Speaker Change: And is there any.
Speaker Change: Eliminate all lines in your public filings.
Speaker Change: Yeah.
Speaker Change: The company does not undertake any obligation to update any forward, except that you're acquainted me ethically wrong also disappointed discussion, especially thank adhered. Please refer to our earnings release.
Speaker Change: The ancient who can then go and get.
Speaker Change: Joining me today on the call.
Speaker Change: <unk>, our founder chairman and CEO, he's bringing bunker, one director and I think the N V and international business.
Speaker Change: T M.
Speaker Change: Just quick on me and Nick.
Speaker Change: Became part of Secretary.
Speaker Change: Now we'd be happy to take some of the question is.
Speaker Change: In light of the conference call.
Speaker Change: Yeah.
Speaker Change: Hello, everyone. This is Jim.
Jim: Let's talk about our industry.
Looking back on my time in history.
Jim: Thanks to a virus economy you may have.
Jim: The Chinese economy shows gradually stabilize and.
Jim: We can retrain, the fact that irrigation personal insurance industry.
Jim: And it is continuing to evolve to the cycle.
Jim: So I'll keep on both.
Jim: To me, it's one that we see a clear guidance and why do instrumentation regulation.
Jim: All of it.
Jim: In addition, the stability and sustainability of the industry improve further in the future.
Jim: Market participants the brand and the technological.
When did it are more likely to stay now at that we would build out new quality productivity with improved technology and innovative it's about it leading our industry.
Jim: It's inflammation.
Jim: It doesn't feel as a company is above it in terms of Los Angeles Department, If you will.
Jim: Three the company continues to hold in Japan, Europe, and the student housing.
Jim: This was accompanied by stable and resilient financial results Joe.
Jim: So Barry do you have any rates at about 659 million since Q1 of 20 minutes you. We have continuously reported stable profitability for every quarter in the fourth quarter the bottom line performance.
Jim: Good.
Barry: Our GAAP net profit attributed to the comedy reaching about $59 1 million, representing a 61% as Joe said, well well Fisher your excuse me three.
Barry: No corporate attributes of the company is 167.
Barry: Many of them in the meantime, we found companies and cash inflow from operations building up our cash balance as of the end up some place three the cash cash equivalents and short term your bathroom.
Barry: L. Three.
Barry: Three point, starting I give you an 8% increase somewhat cluttered our country, they're strengthened our foundation for carrying out steady because government plan what do you have any.
Barry: Our long term growth initiatives and he is going off in rates in the sea change the communists and technology competitiveness.
Barry: Some of it goes back to it in Q4, all business segments maintained they go and how to think about that cause you to think all of you find our leading position in the industry.
Barry: But what does that mean insurance marketplace, despite difficult industry situation.
Barry: We did all of the new products a model with our important change the diverse needs of pox virus getting lucky and then continue to generate any profit well what is our medical correspondent.
Barry: Then committed to our crude oil.
Barry: He was first very small.
Barry:
Barry: Participating in the development of a Motorola home medical of course with them because they suddenly improved transparency and operationally BGC law, even Pac man was reduced.
Speaker Change: Got it.
Speaker Change: Well if I can.
Yes.
Speaker Change: Capability.
Speaker Change: Great.
Speaker Change: The number of hiring new client increasingly making work both in our cooperation with both domestic and foreign considerable company.
Speaker Change: This segment recorded year over year revenue growth of nearly 70 ish.
Speaker Change: Well R&D as a technology driven company, we made substantial investment in R&D and imply from Windows 10, AI large Langley model, Oh and patterns in the fourth quarter, our sports development L. L N one without the spatial completely ignore chapter three.
Speaker Change: So many applications to intermodal the pace at which part of efficiency improvement.
Speaker Change: <unk> enjoyed.
Speaker Change: Now I will touch upon our Cherokee and he had initiated what a job actively.
Speaker Change: Incorporating E S easily proposing to viruses.
Speaker Change: Operations Environmental protection Allergen challenge out Newsy community Embarkment tightly integrating yes, P value with our corporate DNA.
Speaker Change: Jackie ratings results released from the Chinese.
Speaker Change: I mean, yes, the attrition today shows that our ESG rating.
Speaker Change: And you can read in upgrading to only selling score among players in insurance sector.
Speaker Change: Paul why don't you talk on.
Speaker Change: Ramon dalliance with our CSR, we enjoy a healthy bounce Moody's novel medical.
Speaker Change: Mission systems, which have exactly Nick this is Matt.
Speaker Change: Keep security critical illness insurance medical assistant and Cherokee in China.
Speaker Change: Apparently its relaunch in August 10 countries. It has affected the government is that unless you are.
Speaker Change: Provincial level medical support all.
Speaker Change: Our year end nearly doubled and shouldn't have a white boy, it's been on the platform.
Speaker Change: Production on air with any chance of keeping.
Speaker Change: You can see the airline.
Speaker Change: In December Congress, three and maybe talk to earthquake, what is a challenging comp in Spanish and English and a loss of 14 on lagging caught too.
Speaker Change: Is there a factor or yes, and it really damaged homes.
Speaker Change: And I would also like to update everyone with our actions taken in the capital market regarding the share buyback I guess.
Speaker Change: It is February 24, the company has accumulated we repurchased about $39 7 million on the open market at a total knee.
Speaker Change: If at any point $80 million.
Speaker Change: Which of Burns, our comparable more business value and its long term effect. Furthermore, we repurchase shares will be useful to motivate our talented people eat more.
Speaker Change: Over what is a continuum.
Speaker Change: You uphold our commitment to our shareholders. Our board of directors has approved a special cash dividend plans will total about $50 million.
Speaker Change: Millions of dollars with four things for Adi.
Speaker Change: The health of your financial performance of the company and its commitment to shareholder value. The company is pleased to music is supposed to kick in and pull back and it was tied to continued great return value to shareholders in the future.
Speaker Change: This thing is a recap of what worked with you for orchard, culminating in our business outlook after all of that.
Speaker Change: Industry looking to find ways for our strategies are.
For insurance market places.
Speaker Change: Here to you the first of course.
Speaker Change: Do you, providing the service to be leaders in Hawaii with a lot more of my better use the money and that there is more money insurance product through technological innovation to target very tenants work didn't work.
For medical profoundly he will continue to take advantage.
Speaker Change: The advantage of our Gary and the technological capability to ensure sustainable development, well fulfilling stance or end, meaning easily.
Speaker Change: Well he finds by phone we are competing to leveraging workshops they'd hired advantage actually floor in new innovative therapies modest definitely increase our network penetration is population service capabilities.
Speaker Change: Multiple disease category, and creating a new engine for a long time.
Speaker Change: With abundant cash reserves the company will continue to seek corporation and opportunity around insurance and health care sectors.
Speaker Change: As more technologies are salaried technological environment is never easy to do it and grow core technological modes.
She was appointed a longtime droplet based on year to eight yourself a business.
Speaker Change: Cumulation our self development.
Speaker Change: Sure.
Speaker Change: Hum.
And we've been building in California.
Speaker Change: Inventory on our students.
Speaker Change: Now I'll pass it on to discuss our insurance market places.
Speaker Change: Hum.
Speaker Change: In the first quarter the growth of personal insurance premiums in the industry is very slow down again.
Speaker Change: In fact, I'll be focused efforts on either that equation and the long term development and continuously.
Speaker Change: My operation like Midland users. Meanwhile, we actively explored new put us offering and motors.
Customer acquisition channel laying the foundation for.
Speaker Change: Goodbye.
Speaker Change: High quality business that much.
Speaker Change: In the fourth quarter of 14 reached 153 billion insurance related income reached 588 million and operating profit reached $198 million for the full year of two main street. The fr team reached a seven point.
Speaker Change: I'm doing well.
Speaker Change: Net income reached about two points to 34 billion and operating profit reached 528 million in the fourth quarter F. O T O short term insurance product reached over 919 million.
Speaker Change: During this quarter the company strengthen lock them up and senior management or users.
Speaker Change: How is the survey and I'm Gonna marquee user engagement is also easy to increase customer certification satisfaction.
Speaker Change: Well Saturday with number of policies for user rating or to call any adult and the renewal rate for short term insurance women and adults.
Speaker Change: When you bought it.
Speaker Change: We were acquiring users from.
Speaker Change: Production.
Speaker Change: Enhancing the quality and they put a choice leading channel.
Speaker Change: Maybe it was pretty baffled increased by.
Speaker Change: 68, 6% sell through.
Speaker Change: Leading to a 34 point by preventing sequential increase in premiums.
Speaker Change:
Speaker Change: So that is one of our product offering, but I hope you have London insurance policy reached 530 meeting any of the fourth quarter.
Speaker Change: Cause of 22, 9% Y O Y amount this lots of insurance premiums.
Speaker Change: 116, 2% Y O Y during this quarter, we improve the quality.
Speaker Change: Quality for a longtime and shrinking the Samsung partnership with insurance companies to launch more compromise it is correct.
So all of them and the removal of high interest for vaccines. The third cohort, we saw both opportunities and challenges in our industry in terms of online broker channels, we emphasize on and that is a great need a capability of our product portfolio, ensuring a father he made giant.
Speaker Change: At the same time, we cooperate with high quality stuff media channel to grow our high cost me debate.
Speaker Change: Oh, Guangzhou response, we lost or what is the J T 100 program in this offline brokerage all the times to better serve the high net worth customers Ms in Michigan.
Speaker Change: Cooperation with industry partners aiming to be a one stop Qualcomm income happy and ensuring patient finding and well.
Speaker Change: Awesome.
Speaker Change: So as to empower the team of high.
Speaker Change: Hi, calling the broker during the fourth quarter.
Speaker Change: Starts to pick the top performance agents from let's see.
Number of active agents increased by 108% Y O Y and put them through other People's how did that a long term insurance products rose by 8% Y O y.
Speaker Change: In the fourth quarter, what do you what is auto insurance market, playing enhance our synergy with Changan, Paul Hoelscher number can be assuming an independent operation, but to deepen the cooperation on virus attack.
Speaker Change: You mean, R&D, each compound marketing and product offering.
Speaker Change: I'm Paul contribute the T. F 108, 2 million in the first cohort and policy quality remains at industry, leading level with our renewal rate remaining above 90%.
Speaker Change: In the first quarter with components, depending its innovative capabilities across health insurance and things done regarding health insurance, we launch it all by yourself and the way he's product towards dry sunny brand with broader user base.
Speaker Change: But the thing about health insurance essentially covers all groups with carnival are.
Speaker Change: A critical illnesses and a minor in alignment.
Speaker Change: How does anyone need to do it either.
Speaker Change: This information can also buy insurance online reliable.
Speaker Change: On top of three Lucky where health insurance plans, we also launched a product called <unk>.
Speaker Change: This is of course online longtime a critical units insurance plans that cover you theres been preexisting condition. Moreover, we'd develop so they've been productive she was asking.
Speaker Change:
Speaker Change: The denim Rafi course, we launched and what is it all just the industry first maternal and infant insurance designed to cover the entire printing pregnancy circle appalling give you that.
Uh huh have been widely recognized by users in tourism fading insurance, but we watch it on a monthly Ping an life insurance product different from the traditional annual demand or my phone pinion product in market. The monthly payment plan is more flexible for users with lowest level.
Speaker Change: This is an important practice at June 13th diversifying Sydney across different.
Speaker Change: Our market segments.
Speaker Change: Let me brief you about our development of AI.
Speaker Change: We apply our insurance focus last man grandmother, when new York's ratio changed all evening after our commitment.
Speaker Change: So far the user count was air technology currently Vishal already covered multiple scenarios in the in the cheapest recording consultants and the writing claims perfecting customer service and more it can support more professional services such as answering your fundamental question cause on Ping an insurance policy terms.
Speaker Change: I'll drink and horizon are touching and co insurance services, we can also move.
Speaker Change: The two major applications, the AI insurance consulting and Mr. Bernie.
Speaker Change: Both of them up at the on the threshold like model.
Why is your consultant.
Speaker Change: Smart agent that is equipped with lost motor technology capable of immediately communicate with the customer even at times. It can recommend insurance policy it productive tailored to the customers.
Speaker Change: Especially with me, even though is that the amount of the insurance knowledge to better understand if you believe.
Speaker Change: It has been in general cap and you're using medical insurance.
Speaker Change: In this context, the AI insurance it comes up and you can't even cherry.
Speaker Change: In dialogue for up to 40 minutes.
Speaker Change: And they're taking 90% of work.
And every human broker the second application the Super assistant can do and intelligently.
Speaker Change: Intelligent Coke Hollywood system, adding human agents for example, based on the conversation between eight and any users. It did play a real time detection of chips or insurance reality Hudson recommended more suitable product.
Speaker Change: More suitable products for either in real time explain this in a way that's easier for users to understand.
And improve ensuring this everyday fishing wild and crazy.
Speaker Change: Okay.
Speaker Change: <unk> currently unbound, the assistant happening, even though launched at one shops in the smaller hand hold back office, we have obtained three patents and accumulated more than 10 patents related to the last part of it.
Speaker Change: In the future, we will continue to adhere the path of technology and talent.
Speaker Change: Industry, bringing high Cosma insurance there were some there.
This concludes my briefing I are interested in selling hand over to do the powerful and our medical before founding in digital to make the power station.
Speaker Change: Thank you Ron Mike and the Q4 time line Accumulative total of 450 million people don't make any more than likely coupons 16 to over $3 1 million patients. So what are the medical cart on Newcastle spoken about users and an army mom cause you at all.
Speaker Change: For our platform established the funding plan, which provides better team inspections and Samsung for its extremely cold people well over our offline consultant to try.
Speaker Change: Offering additional core to service to hospitalized patients in the first quarter, but welcome dependent transparency and recruitment.
Speaker Change: Reminders from public just to put into place.
Bill: This is bill.
Bill: A discussion and phone with you.
Speaker Change: Goodbye this cant randomly chance to call for details.
How long the range transaction and supervise the entire underwriting process.
Speaker Change: Can you say that you are concerned we keep optimizing the chance to make a critical illness and more accurate and efficient we have continuously.
Speaker Change: And the establishment of a movie that whole medical so of course with them actively responding to the amendment of carried me law in China in Q4, the amendment of the merging of per seat Cherry Hill ROM has pop incorporated immediately a defense into a provision.
Speaker Change: Sure.
Speaker Change: Furthermore, on December 21 hour have a problem with the album Medical support system project has a word that and there are cases award hosted by our people who really don't like.
Speaker Change: In the first quarter, but you can find it on our thinking for clinical tie solutions business maintained steady and healthy.
No one was about 28 million for the full year revenue was 100, a year with an increase of 16, 9% Y O y.
Speaker Change: In Q4 that you can click on collaborating with 167 funds Bimbo Company S E. R O.
Speaker Change: We made great progress on countering with more lenient newsy. During this quarter was the fact, when he joined the supply needs.
Speaker Change: A few of the top.
Speaker Change: By global energy and formally kick off a project with one of them and.
Speaker Change: And more projects are expected to officially launch in 2024.
Speaker Change: Additionally, the E banking platform Finance Corporation agreement with one of the top three global C F ours and officially initiated patient.
Speaker Change: Patient recruitment is important of course I'm fine. It is do you predict the Rocky mountains of English innovative drug R&D, but he wanted to be in China. The Eastbourne clause platform continue to improve our ability accordingly.
Speaker Change: Efficient video accretion because they don't have an AI Judy matching we enrolled in a record number of patient and project or project tougher categories, including dermatology.
Speaker Change: Oratory cardiovascular immunology, Devon, you need info on in term of Seattle with BP.
Speaker Change: Leveraging the experience of accretion will be successfully pure coincidence high project in the rare disease day, Belo therapy, providing more color it system enhancements.
Speaker Change: Love It.
Speaker Change: Such as the data inside medical affairs product and that has been clinical supervision in recruitment and that's my take is that ticket and so on regarding patient survey the pulp on continuing to get kind of cooperation with a leading global and EM.
Speaker Change: And Ah patient health management part of the fleet by integrating technologies such as loss model.
Enhanced patient experience and a T shirt.
Speaker Change: Hi resignation from customer they also signed contracts with multiple leading Don I think again the mhm.
Speaker Change: For medical patient operation kitchen, agitation and tape data insight continuously spanning a number of them and there was scope of cooperation client.
And we continue to strive for technological empowerment for patient finding demand of breaches hero integrating AI D C technologies.
One of them.
Speaker Change: Intelligently I didnt find in keywords interaction intention from the conversation with users, allowing marvelous into general English quick any reliable adjustment.
Speaker Change: Such a application where it was in club is very quality compared to traditional black, but thanks for listening I will now hand over to young well you did go over financial performance. Thank.
Young: Thank you, but how well they were one and we know we'll get through on our financials kind of like slow fourth quarter.
Speaker Change: Before I go into details please be reminded that all numbers quoted here will be RMB and please refer to our earnings release for detailed information our financially.
Speaker Change: I'm, both year on year and quarter on conversation respectively.
For the fourth quarter.
Speaker Change: I mean.
Speaker Change: Complicated in Maryland, or commitment to pursuing a steady and healthy development net operating revenue decreased by 3% Y O y about.
Speaker Change: 659 million for the full year and nine operating revenue reached about two points 53 D. Among backed insurance related income amongst you about two points.
Speaker Change: Albeit it doesn't have to create the eight 5% Y O y.
Speaker Change: Correspondingly Tara deep among tier 162 million, representing an increase of four 4% Y O y.
Speaker Change: There is all kinds of population income amounts to 100 million, representing an increase of nearly 70% Y O y.
Speaker Change: About other operating costs any further on why do I think the last quarter. When you consider they need a financial who's also Campbell for the full year, the operating cost and expenses increased by 13, 5% Y O Y two two points before being for the.
Full year operating cost and expenses increased by just <unk>.
Speaker Change: For Q4, it increased by four 3% Y O y to 633 million.
Speaker Change: With corn collared basis.
Speaker Change: Operating cost and expenses decreased by eight 1% as we adapted our spending pace to adapt to change too in the external environment. Okay for operating costs, we had about 202 million increased by six.
Speaker Change: So about 825%.
Speaker Change: Year over year and decreased by three coins to presenting the Q2, the sequential decrease primarily due to the three a decrease of five eight.
8 million in coffee with your uncertainty there's definitely a decrease of two point screening in the cost of patients with pulmonary provoking team.
Speaker Change: It goes to poor economic incentives increased by 26, 9% Y O Y to 175 eating the increase with our new Bluetooth with me the consolidation of jumbo.
Which generated economic expenses of 39 million and secondly, an increase of $15 8 million on third party type of China's E, partially offset it but that's a decrease of 21 1 million in personal costs and show this comprehensive benefit until a few basis it would be close by.
Speaker Change: Okay.
Speaker Change: Six 9%, primarily due to a decrease of 11 3 million views and marketing personnel costs and share based comp comprehensive he does it.
Speaker Change: G&A expenses were 96 million a decrease of 19.
19, 1% and 16.3% Y O y to acute.
Speaker Change: The decrease was mainly about personal.
Speaker Change: Personnel costs and a shared this comprehensive extended and the professional service fee R&D expenses was $59 eight a decrease of 16.
Speaker Change: Point is big.
Speaker Change: Cause kind of a Y O Y and the 19, 1% in Q O Q, respectively.
Speaker Change: Chris one other thing about personal cost and share those comprehensive exactly suits.
Speaker Change: For Q4.
Speaker Change: My Corbett attribute to accommodate all the rich.
Shareholders was $79 1 million well adopted in that bucket at the Companys ordinary shareholders was $74 7 million for Q1 'twenty.
Speaker Change: I have two.
Speaker Change: True.
Speaker Change: On behalf of Chi.
Speaker Change: Well Q1, only choose the company have a chief bottleneck corporate for eight.
Speaker Change: I was talking to take call it at or nearing some of my free cash cash equivalents and short term in bachman monitoring two three points. So do not get an 8% increase from the linked quarter.
Speaker Change: Obama and tax results.
Speaker Change: Cause issue has wow, two focused on long term development priority.
Speaker Change: To better reward shareholders and investors confidence our board of directors has approved a special cash dividends totaled approximately $15 million.
Speaker Change: There are four things for ordinary shares and a core thing for it yet yes, Yahoo did all ordinary shares and it is as of the closing date of April 19 timeline for U S. At some time are entitled to go with it.
Speaker Change: In summary, we met our financial guidance.
Speaker Change: The market as we have achieved the profitability in each quarter of $10. Three last time before we will continue to create shareholder value with healthy growth on top of it.
Speaker Change: Ladies and gentlemen that will conclude today's conference call. We do thank you for joining us this time.
Yeah.
Speaker Change: The conference has now concluded we thank you for attending today's presentation.
Speaker Change: And you May now disconnect your lines.
Speaker Change: Yeah.
Speaker Change: [music].
Speaker Change: Yeah.
Speaker Change: [music].